On Jan. 20, 2017, White House Chief of Staff Reince Preibus issued a memorandum to federal agencies outlining Pres. Trump’s regulatory process. Under the memorandum, any new regulations must be reviewed and approved by a department or agency head appointed or designated by the President. Any regulations sent to the Office of Federal Register, but not yet published, must be withdrawn for review and approval. For any regulations that have been published, but have not yet become effective, the effective date is temporarily postponed for 60 days from the date of the memo. There are limited exceptions for emergency situations or other urgent circumstances related to health, safety, financial, or national security matters.
Further adjusting the regulation issuance process, on Jan. 30, 2017, Pres. Trump signed the Executive Order on Reducing Regulation and Controlling Regulatory Costs. The order restricts the scope and cost of new regulations issued by federal agencies. The stated reasoning is both to manage and reduce the associated cost imposed on taxpayers when complying with federal regulations, and also to manage the federal budget and funds.
The order specifically directs that for every one new regulation issued, the agency must also identify at least two prior regulations for elimination. For fiscal year 2017, there must be no cost to implementing a new final regulation. The cost of a new regulation may be offset by the elimination of existing costs and prior regulations. For future fiscal years, each agency will need to stay within an identified cost for newly issued regulations and repealed regulations. Lastly, no regulation shall be issued if it was not included on the most recent version of the Unified Regulatory Agenda. There are limited exceptions for emergencies and other circumstances which may justify a waiver.
The full impact of these actions remains to be seen. This may result in fewer regulations being issued in the coming months. Among the rules that are in proposed form are those related to opt-out arrangements impacting affordability and expanding Form 5500 filing to smaller plans. Until directed otherwise, employers should continue their compliance efforts in all areas such as IRC Section 6056 reporting, employer mandate, ERISA plan documents, Form 5500 filings, Section 125 cafeteria plan administration and offers of COBRA. Please watch future issues of Compliance Corner for any developments.
Executive Memorandum »
Executive Order on Reducing Regulation and Controlling Regulatory Costs »
Unified Regulatory Agenda »
Guidance, Executive Memorandum, Regulatory Freeze »
Interim Guidance, Executive Order »