Regulatory Reform

The Unfunded Mandates Information and Transparency Act (UMITA): Shining a Light on the Hidden Costs of Unfunded Mandates

ALEC hosted a congressional conference call with Congresswoman Virginia Foxx (NC) on Tuesday, February 23. The Congresswoman discussed her sponsorship of the Unfunded Mandates Information and Transparency Act (UMITA), and described UMITA as an Act that is about good government and accountability characterizing it as having “bipartisan DNA.” The Act requires federal agencies to balance real costs with prospective benefits before implementing new regulations.

When the federal government institutes new regulations, local and state agencies are left to identify and meet implementation costs on their own. This is a significant burden to state and local governments, as well as to businesses. In 2015 more than 80,000 pages were added to the Federal Register at a cost to the U.S. economy of $1.8 trillion annually. Congresswoman Foxx was adamant that UMITA is “NOT an anti-regulation bill” but rather “a bill to make our regulatory apparatus more effective.”

Building on the overwhelmingly bipartisan Unfunded Mandates Reform Act (UMRA),that was adopted in 1995, UMITA would close significant loopholes in UMRA that both the Clinton and Obama Administrations sought to fix with executive orders. According to Foxx, UMITA will accomplish the following goals.

  • UMITA will end exemptions from transparency requirements for the largest regulators including the Federal Communications Commission (FCC) and the Securities and Exchange Commission (SEC).
  • UMITA will treat changes to conditions of grant aid as mandates for cost disclosure.
  • UMITA strengthens assurances that the public can weigh in on all final rules. Agencies often exploit UMRA’s loopholes to circumvent these requirements.
  • UMITA provides tools to Congress and to the American people to determine the true costs of regulation. Accounting for specific costs such as those passed to consumers and businesses will be codified.
  • UMITA provides the enforcement measures lacking in UMRA. If UMITA’s transparency requirements are not met, state and local governments will allow the judicial branch to place a stay on regulations.

These measures will help increase awareness at federal agencies of the steep price in dollars and lost jobs of regulatory requirements. Foxx underscored the timeliness of the issue, remarking that a recent group of visiting North Carolina county commissioners identified reducing unfunded mandates passed onto them by Washington as their number two priority. Congresswoman Foxx also graciously commended ALEC for its focus on federalism, in general, and unfunded mandates in particular.

Last year 3,378 new rules were finalized and 2,374 are still in the pipeline. Without clear, transparent and accountable rules, state and local agencies will continue to bear the burden of federal policies. UMITA is designed to make the regulatory process efficient, effective, and transparent so that regulations can maximize benefits and limit costs.

In Depth: Regulatory Reform

In his first inaugural address, Thomas Jefferson said that “the sum of good government” was one “which shall restrain men from injuring one another” and “shall leave them otherwise free to regulate their own pursuits of industry.” Sadly, governments – both federal and state – have ignored this axiom and…

+ Regulatory Reform In Depth