Executive Order (EO) 14192, “Unleashing Prosperity Through Deregulation,” signed on January 31, 2025, was published in the Federal Register on February 6. In short, the EO requires each federal agency to repeal at least ten existing regulations or guidance documents for any new regulation or guidance document, claiming that there is an “ever-expanding morass of complicated federal regulations imposing massive costs on the lives of millions of Americans.” The EO is silent regarding the benefits those regulations or guidance afford those millions of Americans, or the costs to the public of removing ten regulations intended to protect people’s rights, health, and safety. During the first Trump administration, EO 13771 merely sought a two-for-one regulation removal scheme. An NLHIC comment letter to the Office of Management and Budget (OMB) in 2017 stated that by arbitrarily repealing two sets of regulations for each new, necessary regulation, EO 13771 would prevent HUD from carrying out its duty as authorized by Congress to operate housing and community development programs in a manner that serves and protects low-income people.
When NLIHC first encountered a Trump administration EO to reduce regulations in 2017, we noticed a Congressional Research Service article, “Can a New Administration Undo a Previous Administration's Regulations?” dated November 21, 2016, asserting that in order to repeal a regulation, the Administrative Procedures Act (APA) requires an agency to undertake the same public notice and comment procedures that are required to propose a new regulation.
Section 5 of EO 14192 clearly states that the ten-for-one requirement is not limited to regulations subject to the APA and includes, “without limitation,” guidance documents and memoranda (which are means by which HUD has typically refined statutory and regulatory provisions), as well as administrative orders, policy statements, and interagency agreements. However, the EO does not include regulations pertaining to the military, national security, homeland security, foreign affairs, or “immigration-related functions of the United States” (ignoring the costs to the nation of rampant immigration sweeps and deportation).
Section 3 of EO 14192 requires all agencies to calculate the incremental cost of all new regulations and repealed regulations to ensure that the total incremental cost of all new regulations is “is significantly less than zero” in FY25 – as determined by the OMB Director. Any new incremental costs associated with a new regulation must be offset by the elimination of existing costs associated with at least ten prior regulations.
Section 3 also requires the OMB Director to establish standards for determining what qualifies as new and offsetting regulations, and for measuring and estimating regulatory costs as part of providing guidance to agencies regarding implementation of EO 14192.
Since 1978, federal agencies have been required by Executive Orders to publish agendas of regulatory and deregulatory activities. Executive Order 12866 of September 30, 1993 has required agencies to participate in the Unified Regulatory Agenda, submitting their regulatory plans for the spring and fall of each year. Section 4 of EO 14192 requires each agency to identify, on an aggregated basis, regulations that increase incremental costs and the offsetting reduced cost of eliminating ten regulations – providing an estimate of cost savings. No regulation shall be added to or removed from the Unified Regulatory Agenda without the OMB Director’s approval and no regulation can be issued if it is not on the Unified Regulatory Agenda. In addition, each year when the administration prepares its budget request to Congress, the OMB Director must allot each agency a total amount of incremental regulatory costs for the upcoming fiscal year. No agency will be allowed to exceed the incremental cost cap assigned by the OMB Director.
Finally, Section 6 of EO 14192 revokes OMB Circular No. A-4 of November 9, 2023 and reinstates OMB Circular A-4 issued on September 17, 2003. NLIHC’s February 10, 2017 comment letter noted that EO 13771 and Office of Information and Regulatory Affairs (OIRA) Memorandum M-17-21 of April 5, 2017 mentioned only the “costs” of regulations; the benefits of regulations were not discussed. NLIHC’s position was that the OIRA Memorandum overemphasized cost by requiring cost to be measured as “opportunity costs” to society, as defined in OMB Circular A-4 (2003). That Circular asserts, “The principle of ‘willingness-to-pay’ (WTP) captures the notion of opportunity cost by measuring what individuals are willing to forgo to enjoy a particular benefit.” Circular A-4 (2003) continues by noting, “Estimating benefits and costs when market prices are hard to measure or markets do not exist is more difficult. In these cases you need to develop appropriate proxies that simulate market exchange.” However, the proxies offered in the Circular depended on market studies of various sorts. HUD program rules intended to ensure that populations served or protected as required by statute are seldom, if ever, amenable to market studies. Although some HUD regulations such as those pertaining to rent reasonableness studies or fair market rent adjustment surveys are quantitative and might entail a cost for developers or local jurisdictions, they serve the important purpose of maximizing available HUD resources.
Read EO 14192 at: https://tinyurl.com/3drsnkj7