In the News

Scholars discuss modernizing regulatory review, with new pieces on artificial intelligence and the duty to respond to public comments, the stochastic nature of cost-benefit analysis, and more.

Leading global experts on discount rates and cost-benefit analysis support a proposed revision to a document known as Circular A-4. As these experts explain, economic evidence and scholarship from recent years consistently support the use of lower discount rates in regulatory analysis and are consistent with the proposed updates.

Over the next two weeks, the Notice & Comment's symposium on modernizing regulatory review will feature a wide range of scholar and practitioner reactions to President Biden’s recently issued Executive Order 14,094 and related draft guidance from the Office of Management and Budget (OMB). To get you situated, this introduction provides some background on the relevant documents.

Through its approach to discounting, distribution, and transboundary effects — as well as numerous other updates — a proposed update to Circular A-4 would modernize regulatory review to be consistent with the latest available research and President Biden’s regulatory priorities.

A Supreme Court ruling that overturns the legal doctrine Chevron v. Natural Resources Defense Council could have wider implications for existing federal regulations, said Don Goodson, a senior attorney with New York University School of Law's Institute for Policy Integrity. "It would pose another practical difficulty in how much relitigation that would open up," Goodson said in an interview. At the same time, Goodson noted that Congress clearly intended to give agencies like the Federal Energy Regulatory Commission broad jurisdiction over areas such as interstate sales and transmission of electricity.

An ambitious Biden administration’s plan to clean up emissions from a heavily polluting transportation sector will face industry litigation, but environmental lawyers see the rule holding up during eventual challenges. But the rule is not as transformative as some claim, which provides it with insulation from future claims that the rule raises “major questions,” according to Meredith Hankins, an attorney for the Institute for Policy Integrity, who said the action is rooted in tried-and-true Clean Air Act authority. The Clean Air Act has always been “technology-forcing,” and electric vehicles are squarely in the same vein as catalytic converter emission controls were when they were first mandated for vehicles, Hankins said.

Under its new administrator, Richard Revesz, OIRA issued draft regulations drastically revising Circular A-4 for the first time in 30 years, substituting more realistic methods for weighing benefits against costs. Revesz, a law professor and onetime dean at NYU, is highly qualified for the job, having long been one of the leading scholarly critics of the misuse of cost-benefit analysis.

The Institute for Policy Integrity at the New York University School of Law, which had backed the Biden administration in the 5th Circuit litigation, celebrated the court’s ruling. “Louisiana’s lawsuit against the government’s climate-damage valuations was doomed from the start due to a lack of standing,” Max Sarinsky, senior attorney for the institute, wrote in an email. “Although the challengers briefly prevailed last year, the district court decision granting their requested relief was widely derided across the political spectrum for misapplying legal doctrines, mischaracterizing facts (including a Constitutional provision), and prioritizing unsupported allegations over Nobel Prize-winning economics.”