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104th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES

 1st Session                                                     104-76
_______________________________________________________________________


 
                  UNFUNDED MANDATES REFORM ACT OF 1995

                                _______


                 March 13, 1995.--Ordered to be printed

_______________________________________________________________________


 Mr. Clinger, from the committee of conference, submitted the following

                           CONFERENCE REPORT

                          [To accompany S. 1]

      The committee of conference on the disagreeing votes of 
the two Houses on the amendment of the House to the bill (S. 
1), to curb the practice of imposing unfunded Federal mandates 
on States and local governments; to strengthen the partnership 
between the Federal Government and State, local and tribal 
governments; to end the imposition, in the absence of full 
consideration by Congress, of Federal mandates on State, local, 
and tribal governments without adequate funding, in a manner 
that may displace other essential governmental priorities; and 
to ensure that the Federal Government pays the costs incurred 
by those governments in complying with certain requirements 
under Federal statutes and regulations; and for other purposes, 
having met, after full and free conference, have agreed to 
recommend and do recommend to their respective Houses as 
follows:
      That the Senate recede from its disagreement to the 
amendment of the House and agree to the same with an amendment 
as follows:
      In lieu of the matter proposed to be inserted by the 
House amendment, insert the following:

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Unfunded Mandates Reform Act 
of 1995''.

SEC. 2. PURPOSES.

    The purposes of this Act are--
            (1) to strengthen the partnership between the 
        Federal Government and State, local, and tribal 
        governments;
            (2) to end the imposition, in the absence of full 
        consideration by Congress, of Federal mandates on 
        State, local, and tribal governments without adequate 
        Federal funding, in a manner that may displace other 
        essential State, local, and tribal governmental 
        priorities;
            (3) to assist Congress in its consideration of 
        proposed legislation establishing or revising Federal 
        programs containing Federal mandates affecting State, 
        local, and tribal governments, and the private sector 
        by--
                    (A) providing for the development of 
                information about the nature and size of 
                mandates in proposed legislation; and
                    (B) establishing a mechanism to bring such 
                information to the attention of the Senate and 
                the House of Representatives before the Senate 
                and the House of Representatives vote on 
                proposed legislation;
            (4) to promote informed and deliberate decisions by 
        Congress on the appropriateness of Federal mandates in 
        any particular instance;
            (5) to require that Congress consider whether to 
        provide funding to assist State, local, and tribal 
        governments in complying with Federal mandates, to 
        require analyses of the impact of private sector 
        mandates, and through the dissemination of that 
        information provide informed and deliberate decisions 
        by Congress and Federal agencies and retain competitive 
        balance between the public and private sectors;
            (6) to establish a point-of-order vote on the 
        consideration in the Senate and House of 
        Representatives of legislation containing significant 
        Federal intergovernmental mandates without providing 
        adequate funding to comply with such mandates;
            (7) to assist Federal agencies in their 
        consideration of proposed regulations affecting State, 
        local, and tribal governments, by--
                    (A) requiring that Federal agencies develop 
                a process to enable the elected and other 
                officials of State, local, and tribal 
                governments to provide input when Federal 
                agencies are developing regulations; and
                    (B) requiring that Federal agencies prepare 
                and consider estimates of the budgetary impact 
                of regulations containing Federal mandates upon 
                State, local, and tribal governments and the 
                private sector before adopting such 
                regulations, and ensuring that small 
                governments are given special consideration in 
                that process; and
            (8) to begin consideration of the effect of 
        previously imposed Federal mandates, including the 
        impact on State, local, and tribal governments of 
        Federal court interpretations of Federal statutes and 
        regulations that impose Federal intergovernmental 
        mandates.

SEC. 3. DEFINITIONS.

    For purposes of this Act--
            (1) except as provided in section 305 of this Act, 
        the terms defined under section 421 of the 
        Congressional Budget and Impoundment Control Act of 
        1974 (as added by section 101 of this Act) shall have 
        the meanings as so defined; and
            (2) the term ``Director'' means the Director of the 
        Congressional Budget Office.

SEC. 4. EXCLUSIONS.

    This Act shall not apply to any provision in a bill, joint 
resolution, amendment, motion, or conference report before 
Congress and any provision in a proposed or final Federal 
regulation that--
            (1) enforces constitutional rights of individuals;
            (2) establishes or enforces any statutory rights 
        that prohibit discrimination on the basis of race, 
        color, religion, sex, national origin, age, handicap, 
        or disability;
            (3) requires compliance with accounting and 
        auditing procedures with respect to grants or other 
        money or property provided by the Federal Government;
            (4) provides for emergency assistance or relief at 
        the request of any State, local, or tribal government 
        or any official of a State, local, or tribal 
        government;
            (5) is necessary for the national security or the 
        ratification or implementation of international treaty 
        obligations;
            (6) the President designates as emergency 
        legislation and that the Congress so designates in 
        statute; or
            (7) relates to the old-age, survivors, and 
        disability insurance program under title II of the 
        Social Security Act (including taxes imposed by 
        sections 3101(a) and 3111(a) of the Internal Revenue 
        Code of 1986 (relating to old-age, survivors, and 
        disability insurance)).

SEC. 5. AGENCY ASSISTANCE.

    Each agency shall provide to the Director such information 
and assistance as the Director may reasonably request to assist 
the Director in carrying out this Act.

             TITLE I--LEGISLATIVE ACCOUNTABILITY AND REFORM

SEC. 101. LEGISLATIVE MANDATE ACCOUNTABILITY AND REFORM.

    (a) In General.--Title IV of the Congressional Budget and 
Impoundment Control Act of 1974 is amended by--
            (1) inserting before section 401 the following:

                  ``Part A--General Provisions''; and

            (2) adding at the end thereof the following new 
        part:

                       ``Part B--Federal Mandates

``SEC. 421. DEFINITIONS.

    ``For purposes of this part:
            ``(1) Agency.--The term `agency' has the same 
        meaning as defined in section 551(1) of title 5, United 
        States Code, but does not include independent 
        regulatory agencies.
            ``(2) Amount.--The term `amount', with respect to 
        an authorization of appropriations for Federal 
        financial assistance, means the amount of budget 
        authority for any Federal grant assistance program or 
        any Federal program providing loan guarantees or direct 
        loans.
            ``(3) Direct costs.--The term `direct costs'--
                    ``(A)(i) in the case of a Federal 
                intergovernmental mandate, means the aggregate 
                estimated amounts that all State, local, and 
                tribal governments would be required to spend 
                or would be prohibited from raising in revenues 
                in order to comply with the Federal 
                intergovernmental mandate; or
                    ``(ii) in the case of a provision referred 
                to in paragraph (5)(A)(ii), means the amount of 
                Federal financial assistance eliminated or 
                reduced;
                    ``(B) in the case of a Federal private 
                sector mandate, means the aggregate estimated 
                amounts that the private sector will be 
                required to spend in order to comply with the 
                Federal private sector mandate;
                    ``(C) shall be determined on the assumption 
                that--
                            ``(i) State, local, and tribal 
                        governments, and the private sector 
                        will take all reasonable steps 
                        necessary to mitigate the costs 
                        resulting from the Federal mandate, and 
                        will comply with applicable standards 
                        of practice and conduct established by 
                        recognized professional or trade 
                        associations; and
                            ``(ii) reasonable steps to mitigate 
                        the costs shall not include increases 
                        in State, local, or tribal taxes or 
                        fees; and
                    ``(D) shall not include--
                            ``(i) estimated amounts that the 
                        State, local, and tribal governments 
                        (in the case of a Federal 
                        intergovernmental mandate) or the 
                        private sector (in the case of a 
                        Federal private sector mandate) would 
                        spend--
                                    ``(I) to comply with or 
                                carry out all applicable 
                                Federal, State, local, and 
                                tribal laws and regulations in 
                                effect at the time of the 
                                adoption of the Federal mandate 
                                for the same activity as is 
                                affected by that Federal 
                                mandate; or
                                    ``(II) to comply with or 
                                carry out State, local, and 
                                tribal governmental programs, 
                                or private-sector business or 
                                other activities in effect at 
                                the time of the adoption of the 
                                Federal mandate for the same 
                                activity as is affected by that 
                                mandate; or
                            ``(ii) expenditures to the extent 
                        that such expenditures will be offset 
                        by any direct savings to the State, 
                        local, and tribal governments, or by 
                        the private sector, as a result of--
                                    ``(I) compliance with the 
                                Federal mandate; or
                                    ``(II) other changes in 
                                Federal law or regulation that 
                                are enacted or adopted in the 
                                same bill or joint resolution 
                                or proposed or final Federal 
                                regulation and that govern the 
                                same activity as is affected by 
                                the Federal mandate.
            ``(4) Direct savings.--The term `direct savings', 
        when used with respect to the result of compliance with 
        the Federal mandate--
                    ``(A) in the case of a Federal 
                intergovernmental mandate, means the aggregate 
                estimated reduction in costs to any State, 
                local, or tribal government as a result of 
                compliance with the Federal intergovernmental 
                mandate; and
                    ``(B) in the case of a Federal private 
                sector mandate, means the aggregate estimated 
                reduction in costs to the private sector as a 
                result of compliance with the Federal private 
                sector mandate.
            ``(5) Federal intergovernmental mandate.--The term 
        `Federal intergovernmental mandate' means--
                    ``(A) any provision in legislation, 
                statute, or regulation that--
                            ``(i) would impose an enforceable 
                        duty upon State, local, or tribal 
                        governments, except--
                                    ``(I) a condition of 
                                Federal assistance; or
                                    ``(II) a duty arising from 
                                participation in a voluntary 
                                Federal program, except as 
                                provided in subparagraph (B)); 
                                or
                            ``(ii) would reduce or eliminate 
                        the amount of authorization of 
                        appropriations for--
                                    ``(I) Federal financial 
                                assistance that would be 
                                provided to State, local, or 
                                tribal governments for the 
                                purpose of complying with any 
                                such previously imposed duty 
                                unless such duty is reduced or 
                                eliminated by a corresponding 
                                amount; or
                                    ``(II) the control of 
                                borders by the Federal 
                                Government; or reimbursement to 
                                State, local, or tribal 
                                governments for the net cost 
                                associated with illegal, 
                                deportable, and excludable 
                                aliens, including court-
                                mandated expenses related to 
                                emergency health care, 
                                education or criminal justice; 
                                when such a reduction or 
                                elimination would result in 
                                increased net costs to State, 
                                local, or tribal governments in 
                                providing education or 
                                emergency health care to, or 
                                incarceration of, illegal 
                                aliens; except that this 
                                subclause shall not be in 
                                effect with respect to a State, 
                                local, or tribal government, to 
                                the extent that such government 
                                has not fully cooperated in the 
                                efforts of the Federal 
                                Government to locate, 
                                apprehend, and deport illegal 
                                aliens;
                    ``(B) any provision in legislation, 
                statute, or regulation that relates to a then-
                existing Federal program under which 
                $500,000,000 or more is provided annually to 
                State, local, and tribal governments under 
                entitlement authority, if the provision--
                            ``(i)(I) would increase the 
                        stringency of conditions of assistance 
                        to State, local, or tribal governments 
                        under the program; or
                            ``(II) would place caps upon, or 
                        otherwise decrease, the Federal 
                        Government's responsibility to provide 
                        funding to State, local, or tribal 
                        governments under the program; and
                            ``(ii) the State, local, or tribal 
                        governments that participate in the 
                        Federal program lack authority under 
                        that program to amend their financial 
                        or programmatic responsibilities to 
                        continue providing required services 
                        that are affected by the legislation, 
                        statute, or regulation.
            ``(6) Federal mandate.--The term `Federal mandate' 
        means a Federal intergovernmental mandate or a Federal 
        private sector mandate, as defined in paragraphs (5) 
        and (7).
            ``(7) Federal private sector mandate.--The term 
        `Federal private sector mandate' means any provision in 
        legislation, statute, or regulation that--
                    ``(A) would impose an enforceable duty upon 
                the private sector except--
                            ``(i) a condition of Federal 
                        assistance; or
                            ``(ii) a duty arising from 
                        participation in a voluntary Federal 
                        program; or
                    ``(B) would reduce or eliminate the amount 
                of authorization of appropriations for Federal 
                financial assistance that will be provided to 
                the private sector for the purposes of ensuring 
                compliance with such duty.
            ``(8) Local government.--The term `local 
        government' has the same meaning as defined in section 
        6501(6) of title 31, United States Code.
            ``(9) Private sector.--The term `private sector' 
        means all persons or entities in the United States, 
        including individuals, partnerships, associations, 
        corporations, and educational and nonprofit 
        institutions, but shall not include State, local, or 
        tribal governments.
            ``(10) Regulation; rule.--The term `regulation' or 
        `rule' (except with respect to a rule of either House 
        of the Congress) has the meaning of `rule' as defined 
        in section 601(2) of title 5, United States Code.
            ``(11) Small government.--The term `small 
        government' means any small governmental jurisdictions 
        defined in section 601(5) of title 5, United States 
        Code, and any tribal government.
            ``(12) State.--The term `State' has the same 
        meaning as defined in section 6501(9) of title 31, 
        United States Code.
            ``(13) Tribal government.--The term `tribal 
        government' means any Indian tribe, band, nation, or 
        other organized group or community, including any 
        Alaska Native village or regional or village 
        corporation as defined in or established pursuant to 
        the Alaska Native Claims Settlement Act (85 Stat. 688; 
        43 U.S.C. 1601 et seq.) which is recognized as eligible 
        for the special programs and services provided by the 
        United States to Indians because of their special 
        status as Indians.

``SEC. 422. EXCLUSIONS.

    ``This part shall not apply to any provision in a bill, 
joint resolution, amendment, motion, or conference report 
before Congress that--
            ``(1) enforces constitutional rights of 
        individuals;
            ``(2) establishes or enforces any statutory rights 
        that prohibit discrimination on the basis of race, 
        color, religion, sex, national origin, age, handicap, 
        or disability;
            ``(3) requires compliance with accounting and 
        auditing procedures with respect to grants or other 
        money or property provided by the Federal Government;
            ``(4) provides for emergency assistance or relief 
        at the request of any State, local, or tribal 
        government or any official of a State, local, or tribal 
        government;
            ``(5) is necessary for the national security or the 
        ratification or implementation of international treaty 
        obligations;
            ``(6) the President designates as emergency 
        legislation and that the Congress so designates in 
        statute; or
            ``(7) relates to the old-age, survivors, and 
        disability insurance program under title II of the 
        Social Security Act (including taxes imposed by 
        sections 3101(a) and 3111(a) of the Internal Revenue 
        Code of 1986 (relating to old-age, survivors, and 
        disability insurance)).

``SEC. 423. DUTIES OF CONGRESSIONAL COMMITTEES.

    ``(a) In General.--When a committee of authorization of the 
Senate or the House of Representatives reports a bill or joint 
resolution of public character that includes any Federal 
mandate, the report of the committee accompanying the bill or 
joint resolution shall contain the information required by 
subsections (c) and (d).
    ``(b) Submission of Bills to the Director.--When a 
committee of authorization of the Senate or the House of 
Representatives orders reported a bill or joint resolution of a 
public character, the committee shall promptly provide the bill 
or joint resolution to the Director of the Congressional Budget 
Office and shall identify to the Director any Federal mandates 
contained in the bill or resolution.
    ``(c) Reports on Federal Mandates.--Each report described 
under subsection (a) shall contain--
            ``(1) an identification and description of any 
        Federal mandates in the bill or joint resolution, 
        including the direct costs to State, local, and tribal 
        governments, and to the private sector, required to 
        comply with the Federal mandates;
            ``(2) a qualitative, and if practicable, a 
        quantitative assessment of costs and benefits 
        anticipated from the Federal mandates (including the 
        effects on health and safety and the protection of the 
        natural environment); and
            ``(3) a statement of the degree to which a Federal 
        mandate affects both the public and private sectors and 
        the extent to which Federal payment of public sector 
        costs or the modification or termination of the Federal 
        mandate as provided under section 425(a)(2) would 
        affect the competitive balance between State, local, or 
        tribal governments and the private sector including a 
        description of the actions, if any, taken by the 
        committee to avoid any adverse impact on the private 
        sector or the competitive balance between the public 
        sector and the private sector.
    ``(d) Intergovernmental Mandates.--If any of the Federal 
mandates in the bill or joint resolution are Federal 
intergovernmental mandates, the report required under 
subsection (a) shall also contain--
            ``(1)(A) a statement of the amount, if any, of 
        increase or decrease in authorization of appropriations 
        under existing Federal financial assistance programs, 
        or of authorization of appropriations for new Federal 
        financial assistance, provided by the bill or joint 
        resolution and usable for activities of State, local, 
        or tribal governments subject to the Federal 
        intergovernmental mandates;
            ``(B) a statement of whether the committee intends 
        that the Federal intergovernmental mandates be partly 
        or entirely unfunded, and if so, the reasons for that 
        intention; and
            ``(C) if funded in whole or in part, a statement of 
        whether and how the committee has created a mechanism 
        to allocate the funding in a manner that is reasonably 
        consistent with the expected direct costs among and 
        between the respective levels of State, local, and 
        tribal government; and
            ``(2) any existing sources of Federal assistance in 
        addition to those identified in paragraph (1) that may 
        assist State, local, and tribal governments in meeting 
        the direct costs of the Federal intergovernmental 
        mandates.
    ``(e) Preemption Clarification and Information.--When a 
committee of authorization of the Senate or the House of 
Representatives reports a bill or joint resolution of public 
character, the committee report accompanying the bill or joint 
resolution shall contain, if relevant to the bill or joint 
resolution, an explicit statement on the extent to which the 
bill or joint resolution is intended to preempt any State, 
local, or tribal law, and, if so, an explanation of the effect 
of such preemption.
    ``(f) Publication of Statement From the Director.--
            ``(1) In general.--Upon receiving a statement from 
        the Director under section 424, a committee of the 
        Senate or the House of Representatives shall publish 
        the statement in the committee report accompanying the 
        bill or joint resolution to which the statement relates 
        if the statement is available at the time the report is 
        printed.
            ``(2) Other publication of statement of director.--
        If the statement is not published in the report, or if 
        the bill or joint resolution to which the statement 
        relates is expected to be considered by the Senate or 
        the House of Representatives before the report is 
        published, the committee shall cause the statement, or 
        a summary thereof, to be published in the Congressional 
        Record in advance of floor consideration of the bill or 
        joint resolution.

``SEC. 424. DUTIES OF THE DIRECTOR; STATEMENTS ON BILLS AND JOINT 
                    RESOLUTIONS OTHER THAN APPROPRIATIONS BILLS AND 
                    JOINT RESOLUTIONS.

    ``(a) Federal Intergovernmental Mandates in Reported Bills 
and Resolutions.--For each bill or joint resolution of a public 
character reported by any committee of authorization of the 
Senate or the House of Representatives, the Director of the 
Congressional Budget Office shall prepare and submit to the 
committee a statement as follows:
            ``(1) Contents.--If the Director estimates that the 
        direct cost of all Federal intergovernmental mandates 
        in the bill or joint resolution will equal or exceed 
        $50,000,000 (adjusted annually for inflation) in the 
        fiscal year in which any Federal intergovernmental 
        mandate in the bill or joint resolution (or in any 
        necessary implementing regulation) would first be 
        effective or in any of the 4 fiscal years following 
        such fiscal year, the Director shall so state, specify 
        the estimate, and briefly explain the basis of the 
        estimate.
            ``(2) Estimates.--Estimates required under 
        paragraph (1) shall include estimates (and brief 
        explanations of the basis of the estimates) of--
                    ``(A) the total amount of direct cost of 
                complying with the Federal intergovernmental 
                mandates in the bill or joint resolution;
                    ``(B) if the bill or resolution contains an 
                authorization of appropriations under section 
                425(a)(2)(B), the amount of new budget 
                authority for each fiscal year for a period not 
                to exceed 10 years beyond the effective date 
                necessary for the direct cost of the 
                intergovernmental mandate; and
                    ``(C) the amount, if any, of increase in 
                authorization of appropriations under existing 
                Federal financial assistance programs, or of 
                authorization of appropriations for new Federal 
                financial assistance, provided by the bill or 
                joint resolution and usable by State, local, or 
                tribal governments for activities subject to 
                the Federal intergovernmental mandates.
            ``(3) Estimate not feasible.--If the Director 
        determines that it is not feasible to make a reasonable 
        estimate that would be required under paragraphs (1) 
        and (2), the Director shall not make the estimate, but 
        shall report in the statement that the reasonable 
        estimate cannot be made and shall include the reasons 
        for that determination in the statement. If such 
        determination is made by the Director, a point of order 
        under this part shall lie only under section 425(a)(1) 
        and as if the requirement of section 425(a)(1) had not 
        been met.
    ``(b) Federal Private Sector Mandates in Reported Bills and 
Joint Resolutions.--For each bill or joint resolution of a 
public character reported by any committee of authorization of 
the Senate or the House of Representatives, the Director of the 
Congressional Budget Office shall prepare and submit to the 
committee a statement as follows:
            ``(1) Contents.--If the Director estimates that the 
        direct cost of all Federal private sector mandates in 
        the bill or joint resolution will equal or exceed 
        $100,000,000 (adjusted annually for inflation) in the 
        fiscal year in which any Federal private sector mandate 
        in the bill or joint resolution (or in any necessary 
        implementing regulation) would first be effective or in 
        any of the 4 fiscal years following such fiscal year, 
        the Director shall so state, specify the estimate, and 
        briefly explain the basis of the estimate.
            ``(2) Estimates.--Estimates required under 
        paragraph (1) shall include estimates (and a brief 
        explanation of the basis of the estimates) of--
                    ``(A) the total amount of direct costs of 
                complying with the Federal private sector 
                mandates in the bill or joint resolution; and
                    ``(B) the amount, if any, of increase in 
                authorization of appropriations under existing 
                Federal financial assistance programs, or of 
                authorization of appropriations for new Federal 
                financial assistance, provided by the bill or 
                joint resolution usable by the private sector 
                for the activities subject to the Federal 
                private sector mandates.
            ``(3) Estimate not feasible.--If the Director 
        determines that it is not feasible to make a reasonable 
        estimate that would be required under paragraphs (1) 
        and (2), the Director shall not make the estimate, but 
        shall report in the statement that the reasonable 
        estimate cannot be made and shall include the reasons 
        for that determination in the statement.
    ``(c) Legislation Falling Below the Direct Costs 
Thresholds.--If the Director estimates that the direct costs of 
a Federal mandate will not equal or exceed the thresholds 
specified in subsections (a) and (b), the Director shall so 
state and shall briefly explain the basis of the estimate.
    ``(d) Amended Bills and Joint Resolutions; Conference 
Reports.--If a bill or joint resolution is passed in an amended 
form (including if passed by one House as an amendment in the 
nature of a substitute for the text of a bill or joint 
resolution from the other House) or is reported by a committee 
of conference in amended form, and the amended form contains a 
Federal mandate not previously considered by either House or 
which contains an increase in the direct cost of a previously 
considered Federal mandate, then the committee of conference 
shall ensure, to the greatest extent practicable, that the 
Director shall prepare a statement as provided in this 
subsection or a supplemental statement for the bill or joint 
resolution in that amended form.

``SEC. 425. LEGISLATION SUBJECT TO POINT OF ORDER.

    ``(a) In General.--It shall not be in order in the Senate 
or the House of Representatives to consider--
            ``(1) any bill or joint resolution that is reported 
        by a committee unless the committee has published a 
        statement of the Director on the direct costs of 
        Federal mandates in accordance with section 423(f) 
        before such consideration, except this paragraph shall 
        not apply to any supplemental statement prepared by the 
        Director under section 424(d); and
            ``(2) any bill, joint resolution, amendment, 
        motion, or conference report that would increase the 
        direct costs of Federal intergovernmental mandates by 
        an amount that causes the thresholds specified in 
        section 424(a)(1) to be exceeded, unless--
                    ``(A) the bill, joint resolution, 
                amendment, motion, or conference report 
                provides new budget authority or new 
                entitlement authority in the House of 
                Representatives or direct spending authority in 
                the Senate for each fiscal year for such 
                mandates included in the bill, joint 
                resolution, amendment, motion, or conference 
                report in an amount equal to or exceeding the 
                direct costs of such mandate; or
                    ``(B) the bill, joint resolution, 
                amendment, motion, or conference report 
                includes an authorization for appropriations in 
                an amount equal to or exceeding the direct 
                costs of such mandate, and--
                            ``(i) identifies a specific dollar 
                        amount of the direct costs of such 
                        mandate for each year up to 10 years 
                        during which such mandate shall be in 
                        effect under the bill, joint 
                        resolution, amendment, motion or 
                        conference report, and such estimate is 
                        consistent with the estimate determined 
                        under subsection (e) for each fiscal 
                        year;
                            ``(ii) identifies any appropriation 
                        bill that is expected to provide for 
                        Federal funding of the direct cost 
                        referred to under clause (i); and
                            ``(iii)(I) provides that for any 
                        fiscal year the responsible Federal 
                        agency shall determine whether there 
                        are insufficient appropriations for 
                        that fiscal year to provide for the 
                        direct costs under clause (i) of such 
                        mandate, and shall (no later than 30 
                        days after the beginning of the fiscal 
                        year) notify the appropriate 
                        authorizing committees of Congress of 
                        the determination and submit either--
                                    ``(aa) a statement that the 
                                agency has determined, based on 
                                a re-estimate of the direct 
                                costs of such mandate, after 
                                consultation with State, local, 
                                and tribal governments, that 
                                the amount appropriated is 
                                sufficient to pay for the 
                                direct costs of such mandate; 
                                or
                                    ``(bb) legislative 
                                recommendations for either 
                                implementing a less costly 
                                mandate or making such mandate 
                                ineffective for the fiscal 
                                year;
                            ``(II) provides for expedited 
                        procedures for the consideration of the 
                        statement or legislative 
                        recommendations referred to in 
                        subclause (I) by Congress no later than 
                        30 days after the statement or 
                        recommendations are submitted to 
                        Congress; and
                            ``(III) provides that such mandate 
                        shall--
                                    ``(aa) in the case of a 
                                statement referred to in 
                                subclause (I)(aa), cease to be 
                                effective 60 days after the 
                                statement is submitted unless 
                                Congress has approved the 
                                agency's determination by joint 
                                resolution during the 60-day 
                                period;
                                    ``(bb) cease to be 
                                effective 60 days after the 
                                date the legislative 
                                recommendations of the 
                                responsible Federal agency are 
                                submitted to Congress under 
                                subclause (I)(bb) unless 
                                Congress provides otherwise by 
                                law; or
                                    ``(cc) in the case that 
                                such mandate that has not yet 
                                taken effect, continue not to 
                                be effective unless Congress 
                                provides otherwise by law.
    ``(b) Rule of Construction.--The provisions of subsection 
(a)(2)(B)(iii) shall not be construed to prohibit or otherwise 
restrict a State, local, or tribal government from voluntarily 
electing to remain subject to the original Federal 
intergovernmental mandate, complying with the programmatic or 
financial responsibilities of the original Federal 
intergovernmental mandate and providing the funding necessary 
consistent with the costs of Federal agency assistance, 
monitoring, and enforcement.
    ``(c) Committee on Appropriations.--
            ``(1) Application.--The provisions of subsection 
        (a)--
                    ``(A) shall not apply to any bill or 
                resolution reported by the Committee on 
                Appropriations of the Senate or the House of 
                Representatives; except
                    ``(B) shall apply to--
                            ``(i) any legislative provision 
                        increasing direct costs of a Federal 
                        intergovernmental mandate contained in 
                        any bill or resolution reported by the 
                        Committee on Appropriations of the 
                        Senate or House of Representatives;
                            ``(ii) any legislative provision 
                        increasing direct costs of a Federal 
                        intergovernmental mandate contained in 
                        any amendment offered to a bill or 
                        resolution reported by the Committee on 
                        Appropriations of the Senate or House 
                        of Representatives;
                            ``(iii) any legislative provision 
                        increasing direct costs of a Federal 
                        intergovernmental mandate in a 
                        conference report accompanying a bill 
                        or resolution reported by the Committee 
                        on Appropriations of the Senate or 
                        House of Representatives; and
                            ``(iv) any legislative provision 
                        increasing direct costs of a Federal 
                        intergovernmental mandate contained in 
                        any amendments in disagreement between 
                        the two Houses to any bill or 
                        resolution reported by the Committee on 
                        Appropriations of the Senate or House 
                        of Representatives.
            ``(2) Certain provisions stricken in senate.--Upon 
        a point of order being made by any Senator against any 
        provision listed in paragraph (1)(B), and the point of 
        order being sustained by the Chair, such specific 
        provision shall be deemed stricken from the bill, 
        resolution, amendment, amendment in disagreement, or 
        conference report and may not be offered as an 
        amendment from the floor.
    ``(d) Determinations of Applicability to Pending 
Legislation.--For purposes of this section, in the Senate, the 
presiding officer of the Senate shall consult with the 
Committee on Governmental Affairs, to the extent practicable, 
on questions concerning the applicability of this part to a 
pending bill, joint resolution, amendment, motion, or 
conference report.
    ``(e) Determinations of Federal Mandate Levels.--For 
purposes of this section, in the Senate, the levels of Federal 
mandates for a fiscal year shall be determined based on the 
estimates made by the Committee on the Budget.

``SEC. 426. PROVISIONS RELATING TO THE HOUSE OF REPRESENTATIVES.

    ``(a) Enforcement in the House of Representatives.--It 
shall not be in order in the House of Representatives to 
consider a rule or order that waives the application of section 
425.
    ``(b) Disposition of Points of Order.--
            ``(1) Application to the house of 
        representatives.--This subsection shall apply only to 
        the House of Representatives.
            ``(2) Threshold burden.--In order to be cognizable 
        by the Chair, a point of order under section 425 or 
        subsection (a) of this section must specify the precise 
        language on which it is premised.
            ``(3) Question of consideration.--As disposition of 
        points of order under section 425 or subsection (a) of 
        this section, the Chair shall put the question of 
        consideration with respect to the proposition that is 
        the subject of the points of order.
            ``(4) Debate and intervening motions.--A question 
        of consideration under this section shall be debatable 
        for 10 minutes by each Member initiating a point of 
        order and for 10 minutes by an opponent on each point 
        of order, but shall otherwise be decided without 
        intervening motion except one that the House adjourn or 
        that the Committee of the Whole rise, as the case may 
        be.
            ``(5) Effect on amendment in order as original 
        text.--The disposition of the question of consideration 
        under this subsection with respect to a bill or joint 
        resolution shall be considered also to determine the 
        question of consideration under this subsection with 
        respect to an amendment made in order as original text.

``SEC. 427. REQUESTS TO THE CONGRESSIONAL BUDGET OFFICE FROM SENATORS.

    ``At the written request of a Senator, the Director shall, 
to the extent practicable, prepare an estimate of the direct 
costs of a Federal intergovernmental mandate contained in an 
amendment of such Senator.

``SEC. 428. CLARIFICATION OF APPLICATION.

    ``(a) In General.--This part applies to any bill, joint 
resolution, amendment, motion, or conference report that 
reauthorizes appropriations, or that amends existing 
authorizations of appropriations, to carry out any statute, or 
that otherwise amends any statute, only if enactment of the 
bill, joint resolution, amendment, motion, or conference 
report--
            ``(1) would result in a net reduction in or 
        elimination of authorization of appropriations for 
        Federal financial assistance that would be provided to 
        State, local, or tribal governments for use for the 
        purpose of complying with any Federal intergovernmental 
        mandate, or to the private sector for use to comply 
        with any Federal private sector mandate, and would not 
        eliminate or reduce duties established by the Federal 
        mandate by a corresponding amount; or
            ``(2) would result in a net increase in the 
        aggregate amount of direct costs of Federal 
        intergovernmental mandates or Federal private sector 
        mandates other than as described in paragraph (1).
    ``(b) Direct Costs.--
            ``(1) In general.--For purposes of this part, the 
        direct cost of the Federal mandates in a bill, joint 
        resolution, amendment, motion, or conference report 
        that reauthorizes appropriations, or that amends 
        existing authorizations of appropriations, to carry out 
        a statute, or that otherwise amends any statute, means 
        the net increase, resulting from enactment of the bill, 
        joint resolution, amendment, motion, or conference 
        report, in the amount described under paragraph (2)(A) 
        over the amount described under paragraph (2)(B).
            ``(2) Amounts.--The amounts referred to under 
        paragraph (1) are--
                    ``(A) the aggregate amount of direct costs 
                of Federal mandates that would result under the 
                statute if the bill, joint resolution, 
                amendment, motion, or conference report is 
                enacted; and
                    ``(B) the aggregate amount of direct costs 
                of Federal mandates that would result under the 
                statute if the bill, joint resolution, 
                amendment, motion, or conference report were 
                not enacted.
            ``(3) Extension of authorization of 
        appropriations.--For purposes of this section, in the 
        case of legislation to extend authorization of 
        appropriations, the authorization level that would be 
        provided by the extension shall be compared to the 
        authorization level for the last year in which 
        authorization of appropriations is already provided.''.
    (b) Technical and Conforming Amendments.--Section 1(b) of 
the Congressional Budget and Impoundment Control Act of 1974 is 
amended--
            (1) by inserting ``Part A--General Provisions'' 
        before the item relating to section 401; and
            (2) by inserting after the item relating to section 
        407 the following:

                       ``Part B--Federal Mandates

``Sec. 421. Definitions.
``Sec. 422. Exclusions.
``Sec. 423. Duties of congressional committees.
``Sec. 424. Duties of the Director; statements on bills and joint 
          resolutions other than appropriations bills and joint 
          resolutions.
``Sec. 425. Legislation subject to point of order.
``Sec. 426. Provisions relating to the House of Representatives.
``Sec. 427. Requests to the Congressional Budget Office from Senators.
``Sec. 428. Clarification of application.''.

SEC. 102. ASSISTANCE TO COMMITTEES AND STUDIES.

    The Congressional Budget and Impoundment Control Act of 
1974 is amended--
            (1) in section 202--
                    (A) in subsection (c)--
                            (i) by redesignating paragraph (2) 
                        as paragraph (3); and
                            (ii) by inserting after paragraph 
                        (1) the following new paragraph:
            ``(2) At the request of any committee of the Senate 
        or the House of Representatives, the Office shall, to 
        the extent practicable, consult with and assist such 
        committee in analyzing the budgetary or financial 
        impact of any proposed legislation that may have--
                    ``(A) a significant budgetary impact on 
                State, local, or tribal governments;
                    ``(B) a significant financial impact on the 
                private sector; or
                    ``(C) a significant employment impact on 
                the private sector.''; and
                    (B) by amending subsection (h) to read as 
                follows:
    ``(h) Studies.--
            ``(1) Continuing studies.--The Director of the 
        Congressional Budget Office shall conduct continuing 
        studies to enhance comparisons of budget outlays, 
        credit authority, and tax expenditures.
            ``(2) Federal mandate studies.--
                    ``(A) At the request of any Chairman or 
                ranking member of the minority of a Committee 
                of the Senate or the House of Representatives, 
                the Director shall, to the extent practicable, 
                conduct a study of a legislative proposal 
                containing a Federal mandate.
                    ``(B) In conducting a study on 
                intergovernmental mandates under subparagraph 
                (A), the Director shall--
                            ``(i) solicit and consider 
                        information or comments from elected 
                        officials (including their designated 
                        representatives) of State, local, or 
                        tribal governments as may provide 
                        helpful information or comments;
                            ``(ii) consider establishing 
                        advisory panels of elected officials or 
                        their designated representatives, of 
                        State, local, or tribal governments if 
                        the Director determines that such 
                        advisory panels would be helpful in 
                        performing responsibilities of the 
                        Director under this section; and
                            ``(iii) if, and to the extent that 
                        the Director determines that accurate 
                        estimates are reasonably feasible, 
                        include estimates of--
                                    ``(I) the future direct 
                                cost of the Federal mandate to 
                                the extent that such costs 
                                significantly differ from or 
                                extend beyond the 5-year period 
                                after the mandate is first 
                                effective; and
                                    ``(II) any disproportionate 
                                budgetary effects of Federal 
                                mandates upon particular 
                                industries or sectors of the 
                                economy, States, regions, and 
                                urban or rural or other types 
                                of communities, as appropriate.
                    ``(C) In conducting a study on private 
                sector mandates under subparagraph (A), the 
                Director shall provide estimates, if and to the 
                extent that the Director determines that such 
                estimates are reasonably feasible, of--
                            ``(i) future costs of Federal 
                        private sector mandates to the extent 
                        that such mandates differ significantly 
                        from or extend beyond the 5-year time 
                        period referred to in subparagraph 
                        (B)(iii)(I);
                            ``(ii) any disproportionate 
                        financial effects of Federal private 
                        sector mandates and of any Federal 
                        financial assistance in the bill or 
                        joint resolution upon any particular 
                        industries or sectors of the economy, 
                        States, regions, and urban or rural or 
                        other types of communities; and
                            ``(iii) the effect of Federal 
                        private sector mandates in the bill or 
                        joint resolution on the national 
                        economy, including the effect on 
                        productivity, economic growth, full 
                        employment, creation of productive 
                        jobs, and international competitiveness 
                        of United States goods and services.''; 
                        and
            (2) in section 301(d) by adding at the end thereof 
        the following new sentence: ``Any Committee of the 
        House of Representatives or the Senate that anticipates 
        that the committee will consider any proposed 
        legislation establishing, amending, or reauthorizing 
        any Federal program likely to have a significant 
        budgetary impact on any State, local, or tribal 
        government, or likely to have a significant financial 
        impact on the private sector, including any legislative 
        proposal submitted by the executive branch likely to 
        have such a budgetary or financial impact, shall 
        include its views and estimates on that proposal to the 
        Committee on the Budget of the applicable House.''.

SEC. 103. COST OF REGULATIONS.

    (a) Sense of the Congress.--It is the sense of the Congress 
that Federal agencies should review and evaluate planned 
regulations to ensure that the cost estimates provided by the 
Congressional Budget Office will be carefully considered as 
regulations are promulgated.
    (b) Statement of Cost.--At the request of a committee 
chairman or ranking minority member, the Director shall, to the 
extent practicable, prepare a comparison between--
            (1) an estimate by the relevant agency, prepared 
        under section 202 of this Act, of the costs of 
        regulations implementing an Act containing a Federal 
        mandate; and
            (2) the cost estimate prepared by the Congressional 
        Budget Office for such Act when it was enacted by the 
        Congress.
    (c) Cooperation of Office of Management and Budget.--At the 
request of the Director of the Congressional Budget Office, the 
Director of the Office of Management and Budget shall provide 
data and cost estimates for regulations implementing an Act 
containing a Federal mandate covered by part B of title IV of 
the Congressional Budget and Impoundment Control Act of 1974 
(as added by section 101 of this Act).

SEC. 104. REPEAL OF CERTAIN ANALYSIS BY CONGRESSIONAL BUDGET OFFICE.

    Section 403 of the Congressional Budget and Impoundment 
Control Act of 1974 is amended--
            (1) in subsection (a)--
                    (A) by striking out paragraph (2);
                    (B) in paragraph (3) by striking out 
                ``paragraphs (1) and (2)'' and inserting in 
                lieu thereof ``paragraph (1)''; and
                    (C) by redesignating paragraphs (3) and (4) 
                as paragraphs (2) and (3), respectively;
            (2) by striking out ``(a)''; and
            (3) by striking out subsections (b) and (c).

SEC. 105. CONSIDERATION FOR FEDERAL FUNDING.

    Nothing in this Act shall preclude a State, local, or 
tribal government that already complies with all or part of the 
Federal intergovernmental mandates included in the bill, joint 
resolution, amendment, motion, or conference report from 
consideration for Federal funding under section 425(a)(2) of 
the Congressional Budget and Impoundment Control Act of 1974 
(as added by section 101 of this Act) for the cost of the 
mandate, including the costs the State, local, or tribal 
government is currently paying and any additional costs 
necessary to meet the mandate.

SEC. 106. IMPACT ON LOCAL GOVERNMENTS.

    (a) Findings.--The Senate finds that--
            (1) the Congress should be concerned about shifting 
        costs from Federal to State and local authorities and 
        should be equally concerned about the growing tendency 
        of States to shift costs to local governments;
            (2) cost shifting from States to local governments 
        has, in many instances, forced local governments to 
        raise property taxes or curtail sometimes essential 
        services; and
            (3) increases in local property taxes and cuts in 
        essential services threaten the ability of many 
        citizens to attain and maintain the American dream of 
        owning a home in a safe, secure community.
    (b) Sense of the Senate.--It is the sense of the Senate 
that--
            (1) the Federal Government should not shift certain 
        costs to the State, and States should end the practice 
        of shifting costs to local governments, which forces 
        many local governments to increase property taxes;
            (2) States should end the imposition, in the 
        absence of full consideration by their legislatures, of 
        State issued mandates on local governments without 
        adequate State funding, in a manner that may displace 
        other essential government priorities; and
            (3) one primary objective of this Act and other 
        efforts to change the relationship among Federal, 
        State, and local governments should be to reduce taxes 
        and spending at all levels and to end the practice of 
        shifting costs from one level of government to another 
        with little or no benefit to taxpayers.

SEC. 107. ENFORCEMENT IN THE HOUSE OF REPRESENTATIVES.

    (a) Motions To Strike in the Committee of the Whole.--
Clause 5 of rule XXIII of the Rules of the House of 
Representatives is amended by adding at the end the following:
    ``(c) In the consideration of any measure for amendment in 
the Committee of the Whole containing any Federal mandate the 
direct costs of which exceed the threshold in section 424(a)(1) 
of the Unfunded Mandate Reform Act of 1995, it shall always be 
in order, unless specifically waived by terms of a rule 
governing consideration of that measure, to move to strike such 
Federal mandate from the portion of the bill then open to 
amendment.''.
    (b) Committee on Rules Reports on Waived Points of Order.--
The Committee on Rules shall include in the report required by 
clause 1(d) of rule XI (relating to its activities during the 
Congress) of the Rules of the House of Representatives a 
separate item identifying all waivers of points of order 
relating to Federal mandates, listed by bill or joint 
resolution number and the subject matter of that measure.

SEC. 108. EXERCISE OF RULEMAKING POWERS.

    The provisions of sections 101 and 107 are enacted by 
Congress--
            (1) as an exercise of the rulemaking power of the 
        Senate and the House of Representatives, respectively, 
        and as such they shall be considered as part of the 
        rules of such House, respectively, and such rules shall 
        supersede other rules only to the extent that they are 
        inconsistent therewith; and
            (2) with full recognition of the constitutional 
        right of either House to change such rules (so far as 
        relating to such House) at any time, in the same 
        manner, and to the same extent as in the case of any 
        other rule of each House.

SEC. 109. AUTHORIZATION OF APPROPRIATIONS.

    There are authorized to be appropriated to the 
Congressional Budget Office $4,500,000 for each of the fiscal 
years 1996, 1997, 1998, 1999, 2000, 2001, and 2002 to carry out 
the provisions of this title.

SEC. 110. EFFECTIVE DATE.

    This title shall take effect on January 1, 1996 or on the 
date 90 days after appropriations are made available as 
authorized under section 109, whichever is earlier and shall 
apply to legislation considered on and after such date.

             TITLE II--REGULATORY ACCOUNTABILITY AND REFORM

SEC. 201. REGULATORY PROCESS.

    Each agency shall, unless otherwise prohibited by law, 
assess the effects of Federal regulatory actions on State, 
local, and tribal governments, and the private sector (other 
than to the extent that such regulations incorporate 
requirements specifically set forth in law).

SEC. 202. STATEMENTS TO ACCOMPANY SIGNIFICANT REGULATORY ACTIONS.

    (a) In General.--Unless otherwise prohibited by law, before 
promulgating any general notice of proposed rulemaking that is 
likely to result in promulgation of any rule that includes any 
Federal mandate that may result in the expenditure by State, 
local, and tribal governments, in the aggregate, or by the 
private sector, of $100,000,000 or more (adjusted annually for 
inflation) in any 1 year, and before promulgating any final 
rule for which a general notice of proposed rulemaking was 
published, the agency shall prepare a written statement 
containing--
            (1) an identification of the provision of Federal 
        law under which the rule is being promulgated;
            (2) a qualitative and quantitative assessment of 
        the anticipated costs and benefits of the Federal 
        mandate, including the costs and benefits to State, 
        local, and tribal governments or the private sector, as 
        well as the effect of the Federal mandate on health, 
        safety, and the natural environment and such an 
        assessment shall include--
                    (A) an analysis of the extent to which such 
                costs to State, local, and tribal governments 
                may be paid with Federal financial assistance 
                (or otherwise paid for by the Federal 
                Government); and
                    (B) the extent to which there are available 
                Federal resources to carry out the 
                intergovernmental mandate;
            (3) estimates by the agency, if and to the extent 
        that the agency determines that accurate estimates are 
        reasonably feasible, of--
                    (A) the future compliance costs of the 
                Federal mandate; and
                    (B) any disproportionate budgetary effects 
                of the Federal mandate upon any particular 
                regions of the nation or particular State, 
                local, or tribal governments, urban or rural or 
                other types of communities, or particular 
                segments of the private sector;
            (4) estimates by the agency of the effect on the 
        national economy, such as the effect on productivity, 
        economic growth, full employment, creation of 
        productive jobs, and international competitiveness of 
        United States goods and services, if and to the extent 
        that the agency in its sole discretion determines that 
        accurate estimates are reasonably feasible and that 
        such effect is relevant and material; and
            (5)(A) a description of the extent of the agency's 
        prior consultation with elected representatives (under 
        section 204) of the affected State, local, and tribal 
        governments;
            (B) a summary of the comments and concerns that 
        were presented by State, local, or tribal governments 
        either orally or in writing to the agency; and
            (C) a summary of the agency's evaluation of those 
        comments and concerns.
    (b) Promulgation.--In promulgating a general notice of 
proposed rulemaking or a final rule for which a statement under 
subsection (a) is required, the agency shall include in the 
promulgation a summary of the information contained in the 
statement.
    (c) Preparation in Conjunction With Other Statement.--Any 
agency may prepare any statement required under subsection (a) 
in conjunction with or as a part of any other statement or 
analysis, provided that the statement or analysis satisfies the 
provisions of subsection (a).

SEC. 203. SMALL GOVERNMENT AGENCY PLAN.

    (a) Effects on Small Governments.--Before establishing any 
regulatory requirements that might significantly or uniquely 
affect small governments, agencies shall have developed a plan 
under which the agency shall--
            (1) provide notice of the requirements to 
        potentially affected small governments, if any;
            (2) enable officials of affected small governments 
        to provide meaningful and timely input in the 
        development of regulatory proposals containing 
        significant Federal intergovernmental mandates; and
            (3) inform, educate, and advise small governments 
        on compliance with the requirements.
    (b) Authorization of Appropriations.--There are authorized 
to be appropriated to each agency to carry out the provisions 
of this section and for no other purpose, such sums as are 
necessary.

SEC. 204. STATE, LOCAL, AND TRIBAL GOVERNMENT INPUT.

    (a) In General.--Each agency shall, to the extent permitted 
in law, develop an effective process to permit elected officers 
of State, local, and tribal governments (or their designated 
employees with authority to act on their behalf) to provide 
meaningful and timely input in the development of regulatory 
proposals containing significant Federal intergovernmental 
mandates.
    (b) Meetings Between State, Local, Tribal and Federal 
Officers.--The Federal Advisory Committee Act (5 U.S.C. App.) 
shall not apply to actions in support of intergovernmental 
communications where--
            (1) meetings are held exclusively between Federal 
        officials and elected officers of State, local, and 
        tribal governments (or their designated employees with 
        authority to act on their behalf) acting in their 
        official capacities; and
            (2) such meetings are solely for the purposes of 
        exchanging views, information, or advice relating to 
        the management or implementation of Federal programs 
        established pursuant to public law that explicitly or 
        inherently share intergovernmental responsibilities or 
        administration.
    (c) Implementing Guidelines.--No later than 6 months after 
the date of enactment of this Act, the President shall issue 
guidelines and instructions to Federal agencies for appropriate 
implementation of subsections (a) and (b) consistent with 
applicable laws and regulations.

SEC. 205. LEAST BURDENSOME OPTION OR EXPLANATION REQUIRED.

    (a) In General.--Except as provided in subsection (b), 
before promulgating any rule for which a written statement is 
required under section 202, the agency shall identify and 
consider a reasonable number of regulatory alternatives and 
from those alternatives select the least costly, most cost-
effective or least burdensome alternative that achieves the 
objectives of the rule, for--
            (1) State, local, and tribal governments, in the 
        case of a rule containing a Federal intergovernmental 
        mandate; and
            (2) the private sector, in the case of a rule 
        containing a Federal private sector mandate.
    (b) Exception.--The provisions of subsection (a) shall 
apply unless--
            (1) the head of the affected agency publishes with 
        the final rule an explanation of why the least costly, 
        most cost-effective or least burdensome method of 
        achieving the objectives of the rule was not adopted; 
        or
            (2) the provisions are inconsistent with law.
    (c) OMB Certification.--No later than 1 year after the date 
of the enactment of this Act, the Director of the Office of 
Management and Budget shall certify to Congress, with a written 
explanation, agency compliance with this section and include in 
that certification agencies and rulemakings that fail to 
adequately comply with this section.

SEC. 206. ASSISTANCE TO THE CONGRESSIONAL BUDGET OFFICE.

    The Director of the Office of Management and Budget shall--
            (1) collect from agencies the statements prepared 
        under section 202; and
            (2) periodically forward copies of such statements 
        to the Director of the Congressional Budget Office on a 
        reasonably timely basis after promulgation of the 
        general notice of proposed rulemaking or of the final 
        rule for which the statement was prepared.

SEC. 207. PILOT PROGRAM ON SMALL GOVERNMENT FLEXIBILITY.

    (a) In General.--The Director of the Office of Management 
and Budget, in consultation with Federal agencies, shall 
establish pilot programs in at least 2 agencies to test 
innovative, and more flexible regulatory approaches that--
            (1) reduce reporting and compliance burdens on 
        small governments; and
            (2) meet overall statutory goals and objectives.
    (b) Program Focus.--The pilot programs shall focus on rules 
in effect or proposed rules, or a combination thereof.

SEC. 208. ANNUAL STATEMENTS TO CONGRESS ON AGENCY COMPLIANCE.

    No later than 1 year after the effective date of this title 
and annually thereafter, the Director of the Office of 
Management and Budget shall submit to the Congress, including 
the Committee on Governmental Affairs of the Senate and the 
Committee on Government Reform and Oversight of the House of 
Representatives, a written report detailing compliance by each 
agency during the preceding reporting period with the 
requirements of this title.

SEC. 209. EFFECTIVE DATE.

    This title and the amendments made by this title shall take 
effect on the date of the enactment of this Act.

                 TITLE III--REVIEW OF FEDERAL MANDATES

SEC. 301. BASELINE STUDY OF COSTS AND BENEFITS.

    (a) In General.--No later than 18 months after the date of 
enactment of this Act, the Advisory Commission on 
Intergovernmental Relations (hereafter in this title referred 
to as the ``Advisory Commission''), in consultation with the 
Director, shall complete a study to examine the measurement and 
definition issues involved in calculating the total costs and 
benefits to State, local, and tribal governments of compliance 
with Federal law.
    (b) Considerations.--The study required by this section 
shall consider--
            (1) the feasibility of measuring indirect costs and 
        benefits as well as direct costs and benefits of the 
        Federal, State, local, and tribal relationship; and
            (2) how to measure both the direct and indirect 
        benefits of Federal financial assistance and tax 
        benefits to State, local, and tribal governments.

SEC. 302. REPORT ON FEDERAL MANDATES BY ADVISORY COMMISSION ON 
                    INTERGOVERNMENTAL RELATIONS.

    (a) In General.--The Advisory Commission on 
Intergovernmental Relations shall in accordance with this 
section--
            (1) investigate and review the role of Federal 
        mandates in intergovernmental relations and their 
        impact on State, local, tribal, and Federal government 
        objectives and responsibilities, and their impact on 
        the competitive balance between State, local, and 
        tribal governments, and the private sector and consider 
        views of and the impact on working men and women on 
        those same matters;
            (2) investigate and review the role of unfunded 
        State mandates imposed on local governments;
            (3) make recommendations to the President and the 
        Congress regarding--
                    (A) allowing flexibility for State, local, 
                and tribal governments in complying with 
                specific Federal mandates for which terms of 
                compliance are unnecessarily rigid or complex;
                    (B) reconciling any 2 or more Federal 
                mandates which impose contradictory or 
                inconsistent requirements;
                    (C) terminating Federal mandates which are 
                duplicative, obsolete, or lacking in practical 
                utility;
                    (D) suspending, on a temporary basis, 
                Federal mandates which are not vital to public 
                health and safety and which compound the fiscal 
                difficulties of State, local, and tribal 
                governments, including recommendations for 
                triggering such suspension;
                    (E) consolidating or simplifying Federal 
                mandates, or the planning or reporting 
                requirements of such mandates, in order to 
                reduce duplication and facilitate compliance by 
                State, local, and tribal governments with those 
                mandates;
                    (F) establishing common Federal definitions 
                or standards to be used by State, local, and 
                tribal governments in complying with Federal 
                mandates that use different definitions or 
                standards for the same terms or principles; and
                    (G)(i) the mitigation of negative impacts 
                on the private sector that may result from 
                relieving State, local, and tribal governments 
                from Federal mandates (if and to the extent 
                that such negative impacts exist on the private 
                sector); and
                    (ii) the feasibility of applying relief 
                from Federal mandates in the same manner and to 
                the same extent to private sector entities as 
                such relief is applied to State, local, and 
                tribal governments; and
            (4) identify and consider in each recommendation 
        made under paragraph (3), to the extent practicable--
                    (A) the specific Federal mandates to which 
                the recommendation applies, including 
                requirements of the departments, agencies, and 
                other entities of the Federal Government that 
                State, local, and tribal governments utilize 
                metric systems of measurement; and
                    (B) any negative impact on the private 
                sector that may result from implementation of 
                the recommendation.
    (b) Criteria.--
            (1) In general.--The Commission shall establish 
        criteria for making recommendations under subsection 
        (a).
            (2) Issuance of proposed criteria.--The Commission 
        shall issue proposed criteria under this subsection no 
        later than 60 days after the date of the enactment of 
        this Act, and thereafter provide a period of 30 days 
        for submission by the public of comments on the 
        proposed criteria.
            (3) Final criteria.--No later than 45 days after 
        the date of issuance of proposed criteria, the 
        Commission shall--
                    (A) consider comments on the proposed 
                criteria received under paragraph (2);
                    (B) adopt and incorporate in final criteria 
                any recommendations submitted in those comments 
                that the Commission determines will aid the 
                Commission in carrying out its duties under 
                this section; and
                    (C) issue final criteria under this 
                subsection.
    (c) Preliminary Report.--
            (1) In general.--No later than 9 months after the 
        date of the enactment of this Act, the Commission 
        shall--
                    (A) prepare and publish a preliminary 
                report on its activities under this title, 
                including preliminary recommendations pursuant 
                to subsection (a);
                    (B) publish in the Federal Register a 
                notice of availability of the preliminary 
                report; and
                    (C) provide copies of the preliminary 
                report to the public upon request.
            (2) Public hearings.--The Commission shall hold 
        public hearings on the preliminary recommendations 
        contained in the preliminary report of the Commission 
        under this subsection.
    (d) Final Report.--No later than 3 months after the date of 
the publication of the preliminary report under subsection (c), 
the Commission shall submit to the Congress, including the 
Committee on Government Reform and Oversight of the House of 
Representatives, the Committee on Governmental Affairs of the 
Senate, the Committee on the Budget of the Senate, and the 
Committee on the Budget of the House of Representatives, and to 
the President a final report on the findings, conclusions, and 
recommendations of the Commission under this section.
    (e) Priority to Mandates That Are Subject of Judicial 
Proceedings.--In carrying out this section, the Advisory 
Commission shall give the highest priority to immediately 
investigating, reviewing, and making recommendations regarding 
Federal mandates that are the subject of judicial proceedings 
between the United States and a State, local, or tribal 
government.
    (f) Definition.--For purposes of this section the term 
``State mandate'' means any provision in a State statute or 
regulation that imposes an enforceable duty on local 
governments, the private sector, or individuals, including a 
condition of State assistance or a duty arising from 
participation in a voluntary State program.

SEC. 303. SPECIAL AUTHORITIES OF ADVISORY COMMISSION.

    (a) Experts and Consultants.--For purposes of carrying out 
this title, the Advisory Commission may procure temporary and 
intermittent services of experts or consultants under section 
3109(b) of title 5, United States Code.
    (b) Detail of Staff of Federal Agencies.--Upon request of 
the Executive Director of the Advisory Commission, the head of 
any Federal department or agency may detail, on a reimbursable 
basis, any of the personnel of that department or agency to the 
Advisory Commission to assist it in carrying out this title.
    (c) Administrative Support Services.--Upon the request of 
the Advisory Commission, the Administrator of General Services 
shall provide to the Advisory Commission, on a reimbursable 
basis, the administrative support services necessary for the 
Advisory Commission to carry out its duties under this title.
    (d) Contract Authority.--The Advisory Commission may, 
subject to appropriations, contract with and compensate 
government and private persons (including agencies) for 
property and services used to carry out its duties under this 
title.

SEC. 304. ANNUAL REPORT TO CONGRESS REGARDING FEDERAL COURT RULINGS.

    No later than 4 months after the date of enactment of this 
Act, and no later than March 15 of each year thereafter, the 
Advisory Commission on Intergovernmental Relations shall submit 
to the Congress, including the Committee on Government Reform 
and Oversight of the House of Representatives and the Committee 
on Governmental Affairs of the Senate, and to the President a 
report describing any Federal court case to which a State, 
local, or tribal government was a party in the preceding 
calendar year that required such State, local, or tribal 
government to undertake responsibilities or activities, beyond 
those such government would otherwise have undertaken, to 
comply with Federal statutes and regulations.

SEC. 305. DEFINITION.

    Notwithstanding section 3 of this Act, for purposes of this 
title the term ``Federal mandate'' means any provision in 
statute or regulation or any Federal court ruling that imposes 
an enforceable duty upon State, local, or tribal governments 
including a condition of Federal assistance or a duty arising 
from participation in a voluntary Federal program.

SEC. 306. AUTHORIZATION OF APPROPRIATIONS.

    There are authorized to be appropriated to the Advisory 
Commission to carry out section 301 and section 302, $500,000 
for each of fiscal years 1995 and 1996.

                       TITLE IV--JUDICIAL REVIEW

SEC. 401. JUDICIAL REVIEW.

    (a) Agency Statements on Significant Regulatory Actions.--
            (1) In general.--Compliance or noncompliance by any 
        agency with the provisions of sections 202 and 203(a) 
        (1) and (2) shall be subject to judicial review only in 
        accordance with this section.
            (2) Limited review of agency compliance or 
        noncompliance.--(A) Agency compliance or noncompliance 
        with the provisions of sections 202 and 203(a) (1) and 
        (2) shall be subject to judicial review only under 
        section 706(1) of title 5, United States Code, and only 
        as provided under subparagraph (B).
            (B) If an agency fails to prepare the written 
        statement (including the preparation of the estimates, 
        analyses, statements, or descriptions) under section 
        202 or the written plan under section 203(a) (1) and 
        (2), a court may compel the agency to prepare such 
        written statement.
            (3) Review of agency rules.--In any judicial review 
        under any other Federal law of an agency rule for which 
        a written statement or plan is required under sections 
        202 and 203(a) (1) and (2), the inadequacy or failure 
        to prepare such statement (including the inadequacy or 
        failure to prepare any estimate, analysis, statement or 
        description) or written plan shall not be used as a 
        basis for staying, enjoining, invalidating or otherwise 
        affecting such agency rule.
            (4) Certain information as part of record.--Any 
        information generated under sections 202 and 203(a) (1) 
        and (2) that is part of the rulemaking record for 
        judicial review under the provisions of any other 
        Federal law may be considered as part of the record for 
        judicial review conducted under such other provisions 
        of Federal law.
            (5) Application of other federal law.--For any 
        petition under paragraph (2) the provisions of such 
        other Federal law shall control all other matters, such 
        as exhaustion of administrative remedies, the time for 
        and manner of seeking review and venue, except that if 
        such other Federal law does not provide a limitation on 
        the time for filing a petition for judicial review that 
        is less than 180 days, such limitation shall be 180 
        days after a final rule is promulgated by the 
        appropriate agency.
            (6) Effective date.--This subsection shall take 
        effect on October 1, 1995, and shall apply only to any 
        agency rule for which a general notice of proposed 
        rulemaking is promulgated on or after such date.
    (b) Judicial Review and Rule of Construction.--Except as 
provided in subsection (a)--
            (1) any estimate, analysis, statement, description 
        or report prepared under this Act, and any compliance 
        or noncompliance with the provisions of this Act, and 
        any determination concerning the applicability of the 
        provisions of this Act shall not be subject to judicial 
        review; and
            (2) no provision of this Act shall be construed to 
        create any right or benefit, substantive or procedural, 
        enforceable by any person in any administrative or 
        judicial action.

      And the House agree to the same.
                                   William F. Clinger,
                                   Rob Portman,
                                   David Dreier,
                                   Tom Davis,
                                   Gary Condit,
                                   Cardiss Collins,
                                   Edolphus Towns,
                                   Joe Moakley,
                                 Managers on the Part of the House.
                                   Dirk Kempthorne,
                                   Bill Roth,
                                   Pete V. Domenici,
                                   John Glenn,
                                   J.J. Exon,
                                Managers on the Part of the Senate.
       JOINT EXPLANATORY STATEMENT OF THE COMMITTEE OF CONFERENCE

      The managers on the part of the House and the Senate at 
the conference on the disagreeing votes of the two Houses on 
the amendment of the House to the bill (S. 1) to curb the 
practice of imposing unfunded Federal mandates on States and 
local governments; to strengthen the partnership between the 
Federal Government and State, local and tribal governments; to 
end the imposition, in the absence of full consideration by 
Congress of Federal mandates on State, local, and tribal 
governments without adequate funding, in a manner that may 
displace other essential governmental priorities; and to ensure 
that the Federal government pays the costs incurred by those 
governments in complying with certain requirements under 
Federal statutes and regulations; and for other purposes, 
submit the following joint statement to the House and the 
Senate in explanation of the effect of the action agreed upon 
by the managers and recommended in the accompanying conference 
report:
      The House amendment to the text of the bill struck out 
all of the Senate bill after the enacting clause and inserted a 
substitute text.
      The Senate recedes from its disagreement to the amendment 
of the House with an amendment which is a substitute for the 
Senate bill and the House amendment. The differences between 
the Senate bill, the House amendment, and the substitute agreed 
to in conference are noted below, except for clerical 
corrections, conforming changes made necessary by agreements 
reached by the conferees, and minor drafting and clarifying 
changes.
Sec. 2. Purposes
      The Senate Bill includes a list of purposes for S. 1.
      The House amendment contains a similar list with one 
exception. Subsection (8) of the House Amendment states that 
one of the purposes is to begin consideration of methods to 
relieve State, local, and tribal governments of unfunded 
mandates that result from Court interpretations of statutes and 
regulations.
      The Conference Substitute adopts the House provision with 
an amendment. The substitute provides under subsection (8) that 
one of the purposes of the bill is to begin the consideration 
of the effect of mandates on States, local governments, and 
tribal governments, including those imposed by court 
interpretations of Federal statutes.
Sec. 3. Definitions
      The Senate Bill provides that for purposes of this Act 
the terms defined under Sec. 408(h) of the Congressional Budget 
and Impoundment Control Act of 1974 (as added by Sec. 101 of 
this Act) shall have the meanings as defined. The Senate Bill 
also defines the term ``Director'' as the Director of the 
Congressional Budget Office.
      The House Amendment provides that for purposes of this 
Act the terms defined under Sec. 421 of the Congressional 
Budget Act of 1974 (as added by Sec. 301 of this Act) shall 
have the meanings as defined. The House Amendment also defines 
the term ``small government''.
      The Conference Substitute adopts the Senate language with 
technical changes.
Sec. 4. Exclusions
      Section 4 of the Senate Bill, titled ``Exclusions'', sets 
out those provisions that are exempt from S. 1.
      Section 4 of the House Amendment, titled ``Limitation on 
Application'', establishes a similar list of exempt provisions 
with two differences. For the exclusion applying to legislation 
that prohibits discrimination, the House uses ``gender'' rather 
than ``sex'' and does not include ``color.'' The House bill 
also includes an exclusion for any provision that pertains to 
Social Security.
      The Conference Substitute adopts the Senate Bill's 
language with a narrower exclusion for Social Security. The 
Substitute only excludes legislation that relates to Title II 
of the Social Security Act.
Sec. 5. Agency assistance
      The Senate Bill requires agencies to provide information 
and assistance to the Director of the Congressional Budget 
Office in carrying out this Act.
      The House Amendment contains no such provision.
      The Conference Substitute adopts the Senate language.

             Title I. Legislative Accountability and Reform

Sec. 101. Legislative Mandate Accountability and Reform
      Section 101 of the Senate Bill adds a new section 408 to 
the Congressional Budget and Impoundment Control Act of 1974 
that establishes new Congressional procedures for the 
consideration of mandate legislation.
      Section 301 of the House Amendment divides Title IV of 
the Budget Act into two parts. Part A contains all the existing 
provisions of Title IV of the Budget Act. Part B contains the 
new procedures for Congressional consideration of mandate 
legislation.
      Section 101 of the Conference Substitute adopts the House 
framework for amending the Budget Act. It adds new sections 421 
through 428 as Part B of the Budget Act.
Sec. 421. Definitions
      Section 101(a) of the Senate Bill adds a new Section 
408(h) to the Budget Act that defines terms for the purposes of 
this Act. This subsection defined the following terms: 
``Federal intergovernmental mandate'', ``Federal private sector 
mandate'', ``Federal mandate'', ``Federal mandate direct 
costs'', ``amount'', ``private sector'', ``local government'', 
``tribal government'', ``small government'', ``State'', 
``agency'', ``regulation'' (or ``rule''), and ``direct 
savings''.
      The House Amendment defines a similar list of terms as a 
new section 421 of the Budget Act with the following 
differences. The House Amendment does not include in the 
definition of the term ``Federal Intergovernmental Mandate'' a 
reduction or elimination of the amount authorized to be 
appropriated for the control of borders by the Federal 
Government or for reimbursement of net costs associated with 
illegal, deportable, and excludable aliens, unless the State, 
Local, or tribal government has not fully cooperated with 
Federal efforts to locate, apprehend, and deport illegal 
aliens. In the definition of the term ``Federal Mandate Direct 
Costs,'' the House Amendment includes the aggregated estimated 
amounts forgone in revenues in order to comply with a Federal 
intergovernmental mandate. The House amendment defines 
``private sector'' to include ``business trusts, or legal 
representatives and organized groups of individuals'' and 
excludes from this definition ``all persons or entities in the 
United States.'' The House Amendment does not exclude from the 
definition of ``agency'' the Office of the Comptroller of the 
Currency and the Office of Thrift Supervision. The House 
Amendment does not include a definition of ``amount'', ``tribal 
government'', or ``direct savings''. The House Amendment 
includes a definition of ``Director'', ``Federal Financial 
Assistance'', and ``Significant Employment Impact''.
      The Conference Substitute includes the list of 
definitions in a new section 421 of the Budget Act. The 
Substitute uses the Senate list of definitions with the House 
language on revenue forgone and defines the term ``agency'' as 
provided in the House Amendment. The Substitute defines the 
term ``Director'' in section 3.
      The Conference Substitute defines direct costs to include 
the aggregate amount State, local, and tribal governments would 
be prohibited for raising in revenue including user fees. The 
conferees note that the Joint Committee on Taxation is 
responsible for providing revenue estimates to CBO for 
legislation that affects revenues. CBO works closely with the 
Joint Tax Committee to assure these revenue estimates are 
reflected in cost estimates. The conferees do not intend to 
disrupt CBO's and the Joint Committee's respective 
responsibilities and expect the Joint Committee on Taxation 
will provide Congress with estimates for legislation that 
prohibits State, local, or tribal governments from raising 
revenue.
      Subsection 5(B) of the Conference Substitute includes in 
the definition of an intergovernmental mandate any provision in 
legislation, statute, or regulation that relates to a then-
existing Federal program that would place caps upon, or 
otherwise decrease, the Federal Government's responsibility to 
provide entitlement funding to State, local, or tribal 
governments under the program. The conferees intend that this 
definition only apply to caps on individual programs. The 
conferees do not intend this definition to be applicable to a 
measure that contains general budgetary limits or caps on 
spending or categories of spending, unless that measure also 
contained implementing statutory language for reductions 
required in specific programs if the budgetary limit or cap 
were exceeded.
      The programs to which this definition relates are Federal 
entitlement programs that provide $500 million or more annually 
to State, local and tribal governments. This would currently 
include only nine programs: Medicaid; AFDC, Child Nutrition; 
Food Stamps; Social Services Block Grants; Vocational 
Rehabilitation State Grants; Foster Care, Adoption Assistance 
and Independent Living; Family Support Payments for Job 
Opportunities and Basic Skills (JOBS); and, Child Support 
Enforcement. This subsection would also apply to entitlement 
programs that Congress may create in the future where Congress 
provides $500 million or more annually to State, local and 
tribal governments.
      The conferees do not interpret the meaning of 
``enforceable duty'' in subsection (5)(A)(i) and (ii) to 
include duties and conditions that are part of any voluntary 
Federal contract for the provision of goods and services.
Sec. 422. Exclusions
      Section 101(a) of the Senate Bill adds a new Section 
408(g) to the Budget Act that provides the same exclusions as 
contained in section 4 of S. 1.
      Section 301(a) of the House Amendment adds a new section 
422 to the Budget Act that provides the same limitations on 
application as a section 4 of the Amendment.
      Section 101(a) of the Conference Substitute adds a new 
Section 422 to the Budget Act that repeats the same exclusions 
provided in section 4 of the Substitute.
Sec. 423. Committee reports
      Section 101(a) of the Senate Bill adds a new Section 
408(a) to the Budget Act that requires an authorizing 
committee, when it orders reported a public bill or joint 
resolution (hereafter ``a measure'') establishing or affecting 
any Federal mandates, to submit the measure to CBO and identify 
the mandates involved. The Senate Bill requires that reports by 
authorizing committees on measures dealing with Federal 
mandates include the following information on the mandates in 
the bill: an identification of the mandates, a cost-benefit 
analysis, the impact on the public and private sector 
competitive balance, information on Federal funding assistance 
to cover the cost of the mandate (including how Federal funding 
will be allocated among different levels of government), the 
extent to which the bill preempts State, local, or tribal 
government law, and a CBO cost estimate.
      Section 301(a) of the House Amendment adds a new section 
423 to the Budget Act that establishes similar requirements for 
committee reports except the Amendment does not require the 
report to indicate whether the mandate bill includes a 
mechanism to allocate funding in accordance with costs to 
different levels of government.
      Section 101(a) of the Conference Substitute adds a new 
Section 423 to the Budget Act that adopts the Senate's 
requirements for reports with technical changes.
Sec. 424. CBO Cost Estimates
      Section 101(a) of the Senate Bill adds a new Section 
408(b)(1) to the Budget Act that requires CBO to prepare, and 
submit to the reporting committee, an estimate of the direct 
costs to the State, local, and tribal governments of Federal 
intergovernmental mandates in each reported measure (or in 
necessary implementing regulations). For intergovernmental 
mandates, CBO is required to prepare estimates if the costs of 
the mandate would equal at least $50 million in any of the five 
fiscal years after the mandate's effective date. For private 
sector mandates, CBO is required to prepare estimates if the 
costs of the mandate would equal at least $200 million in any 
of the five fiscal years after the mandate's effective date. 
The Senate bill extends the scope of the estimate to ten years 
following the mandate's effective date.
      The Senate Bill provides if CBO finds it not feasible to 
make a reasonable estimate, CBO must report that finding with 
an explanation. If CBO makes such a determination for an 
intergovernmental mandate, then a point of order would lie 
against the reported bill only for failure to contain such an 
estimate under section 408(c)(1)(A). In such case, the bill as 
reported would be exempt only from the point of order under 
section 408(c)(1)(B). Other Budget Act points of order would 
still lie if applicable.
      Section 408(b)(3) of the Senate Bill provides that if 
direct cost of respective mandates in a measure fall below the 
thresholds, CBO is to so state, and is to explain briefly the 
basis of this estimate. Paragraph (4) of this subsection 
requires a conference committee, under certain circumstances, 
to ensure that CBO prepare a supplemental estimate on a measure 
passed by either house in an amended form (including a measure 
of one house passed by the other with an amendment in the 
nature of a substitute) or reported from conference in an 
amended form. The Senate Bill requires such action if the 
amended form contains a mandate not previously considered by 
either house or increases the direct cost of a mandate in the 
measure.
      Section 301(a) of the House Amendment adds a new section 
424(a) to the Budget Act that establishes similar requirements 
for CBO cost estimates on mandates. The House Amendment 
provides the threshold is $50 million for both 
intergovernmental and private sector mandates. In addition, the 
Amendment does not limit the scope of the estimate to ten 
years.
      Section 101(a) of the Conference Substitute adds a new 
Section 424 to the Budget Act that adopts the Senate language 
on CBO's responsibilities for preparing estimates on 
legislation containing intergovernmental and private sector 
mandates with two changes. The Substitute amends the language 
the Senate proposed on the scope of CBO cost estimates. If the 
bill would authorize appropriations and makes an 
intergovernmental mandate contingent on appropriations as 
provided in section 425(a)(2)(B) in the Conference Substitute, 
then CBO is required to provide an estimate of the budget 
authority needed to pay for the mandate for each fiscal year 
for a period not to exceed ten years. The Substitute provides a 
threshold of $100 million for private sector mandates.
Sec. 425. Points of Order Against Unfunded Mandates
            Point of Order & Mandate Cost Estimates
      Section 101(a) of the Senate Bill adds a new Section 
408(c)(1)(A) to the Budget Act that establishes a point of 
order in the Senate against consideration of a reported measure 
containing a mandate unless the report accompanying the measure 
contains a CBO cost estimate of the mandate, or the CBO cost 
estimate has been published in the Congressional Record.
      Section 301(a) of the House Amendment adds a new Section 
424(a)(1) to the Budget Act that establishes a similar point of 
order in the Senate and the House against consideration of a 
reported measure, but provides it does not apply to 
supplemental estimates prepared by CBO.
      Section 101(a) of the Conference Substitute adds a new 
Section 425(a) to the Budget Act that adopts the House language 
with minor changes.
            Point of Order & Unfunded Mandate Legislation
      Section 101(a) of the Senate Bill adds a new Section 
408(c)(1)(B) to the Budget Act that establishes a point of 
order in the Senate against consideration of a bill, joint 
resolution, amendment, motion, or conference report (hereafter 
referred to as ``legislation'') containing intergovernmental 
mandates exceeding the thresholds established above, unless the 
legislation funds these mandates. The Senate bill applies this 
point of order against legislation that would cause the direct 
costs of intergovernmental mandates to breach the $50 million 
annual threshold. The waiver of this point of order and the 
appeal of rulings regarding this point of order are covered by 
existing provisions under title IX of the Budget Act. Section 
904 provides that in the Senate points of order under title IV 
of the Budget Act, including the point of order regarding 
unfunded mandate legislation, can be waived or appealed by a 
simple majority.
      This subparagraph of the Senate Bill provides that 
legislation is not subject to the point of order if it provides 
either: (1) direct spending authority equal to the mandate's 
costs for each fiscal year; (2) an increase in receipts and an 
increase in direct spending authority for each fiscal year for 
those mandates equal to their costs for each fiscal year; or, 
(3) an authorization of appropriations at least equal to the 
direct cost and provides a mechanism to ensure that a mandate 
is effective only to the extent that it is funded in 
appropriations Acts.
      The House Amendment establishes a similar point of order 
against consideration of legislation in the House and Senate 
containing intergovernmental mandates. The House amendment 
differs from the Senate bill on the requirements of funding 
mechanisms for mandates. Under the House amendment, legislation 
is subject to the point of order unless it provides: (1) new 
budget authority or new entitlement authority in the House (or 
direct spending authority in the Senate) in an amount that 
equals or exceeds the direct costs of the mandate; (2) an 
increase in receipts or a decrease in new budget authority or 
new entitlement authority in the House (a decrease in direct 
spending authority in the Senate) to offset the costs of 
spending authority for the mandate; or, (3) an authorization of 
appropriations at least equal to the direct cost and provides a 
mechanism to ensure that a mandate never takes effect unless 
fully funded in appropriations Acts or mandates are scaled back 
consistent with appropriations levels.
      The Conference Substitute adopts the House language with 
an amendment. The Substitute provides that legislation 
containing a Federal intergovernmental mandate is out of order 
in the House and Senate unless it provides either: (1) new 
budget authority or new entitlement authority in the House (or 
direct spending authority in the Senate) in an amount that 
equals or exceeds the direct costs of the mandate; or (2) an 
authorization of appropriations and a mechanism to assure the 
mandate is only effective to the extent funding is provided in 
Appropriations Acts. If legislation funds the mandate to avoid 
the point of order, it must fund the entire cost of the mandate 
for each fiscal year.
      The Substitute drops language in the House Amendment that 
provides a mandate could be paid for by an increase in spending 
authority and offset by a decrease in spending authority or an 
increase in receipts. This language is unnecessary because 
other budget laws already would govern how Federal mandates 
could be financed.
      Nothing in the Substitute waives existing provisions of 
law that establish controls on Federal spending. The Budget 
Act, budget resolutions adopted pursuant to the Budget Act, and 
the Balanced Budget and Emergency Deficit Control Act already 
establish requirements for Federal budgeting. Since these laws 
already control legislation providing Federal funding, 
including funding that could be provided to cover a mandate's 
direct costs, the conference agreement does not address 
requirements for offsets to pay for Federal funding for 
mandates.
      The Substitute provides that the point of order can be 
avoided if the mandate is paid for by either an increase in 
spending authority outside the appropriations process (new 
budget authority or new entitlement authority in the House of 
Representatives and new direct spending authority in the 
Senate) or is contingent on funding being provided in the 
appropriations process.
      If a Committee chooses to fund a mandate with spending 
authority outside the appropriations process, this legislation 
will be subject to the requirements of the Budget Act and the 
pay-as-you-go provisions of the Balanced Budget and Emergency 
Deficit Control Act. If a committee chooses to pay for a 
mandate with an increase in spending authority outside the 
Appropriations process, there are generally three options under 
these laws: provide new spending authority that will cause a 
deficit increase; provide new spending authority and offset it 
by reducing existing spending authority for other programs; or, 
provide new spending authority and offset it by increasing 
receipts. If a committee chooses to make the mandate contingent 
on funding being provided in Appropriations Acts, the 
Appropriations Committees will have to fund these mandates 
within the annual allocations made under section 602 of the 
Budget Act and the discretionary caps under section 601 of the 
Budget Act.
            Point of Order & the Appropriations Process
      Section 101(a) of the Senate Bill adds a new Section 
408(c)(1)(B)(iii) to the Budget Act that allows legislation to 
avoid the unfunded mandate point of order if the mandate is 
contingent on funding being provided in the appropriations 
process. More specifically, the legislation would escape the 
point of order if it: (1) authorizes appropriations in an 
amount equal to the direct costs of the mandate; (2) specifies 
the amount of direct costs of the mandate for each year or 
other period up to ten years during which the mandate will be 
in effect; (3) identifies any appropriation bill that would be 
expected to provide funding for direct costs of the mandate; 
and (4) provides that, if appropriations are insufficient to 
cover the direct cost of the mandate (as previously calculated 
by CBO), the mandate will expire unless Congress provides 
otherwise by law (through expedited procedures).
      Section 408(c)(1)(B)(iii)(III) of the Senate Bill 
requires mandate legislation to include procedures in the event 
insufficient appropriations are provided to cover the entire 
direct costs of a Federal intergovernmental mandate for a 
fiscal year. If appropriations provided are insufficient for 
the mandate, the Agency is required to notify Congress within 
30 days of the beginning of the fiscal year and submit either: 
(1) a statement, based on a re-estimate of the direct costs of 
the mandate, that the lower appropriations is sufficient; or, 
(2) legislative recommendations for implementing a less costly 
mandate or making the mandate ineffective for the fiscal year. 
Sixty days after the Agency submission, the mandate ceases to 
be effective unless Congress provides otherwise by law (see 
Appendix). Only if the appropriation is less than the direct 
cost of the mandate, the agency is required to submit a 
statement or legislative recommendation.
      Section 408(c)(1)(B)(iii)(III)(bb) stipulates that the 
relevant committees in both the House and Senate provide an 
expedited procedure in the underlying intergovernmental 
legislation for the consideration of agency statements and 
legislative recommendations. If the relevant committees of the 
House and Senate choose not to include expedited procedures in 
the underlying intergovernmental mandates legislation, then a 
point of order may be raised against that legislation.
      Section 408(c)(3)(A) of the Senate Bill exempts 
appropriations legislation from the points of order against 
unfunded mandates but establishes a procedure to extract 
legislative intergovernmental mandate provisions in 
appropriations legislation. An appropriations bill, resolution, 
amendment thereto, or conference report thereon that contains a 
provision with an intergovernmental mandate that exceeds the 
thresholds established in the Bill is out of order in the 
Senate. Upon a point of order being sustained against 
provisions in appropriations legislation containing mandates, 
the offending provision is deemed strickened from the measure.
      Section 408(c)(2) allows State, local, or tribal 
governments to continue to voluntarily comply with the original 
intergovernmental mandate at its own expense.
      Section 301(a) of the House Amendment adds a new Section 
425(a)(2)(C) to the Budget Act that establishes different 
procedures for intergovernmental mandates that are contingent 
on appropriations Acts. More specifically, if mandate 
legislation funds an intergovernmental mandate through an 
authorization of appropriations, in order to avoid the point of 
order, the legislation must either: 1) require the implementing 
agency to repeal the mandate at the beginning of the fiscal 
year unless there are sufficient appropriations to cover the 
full cost of the mandate; or, 2) require the implementing 
agency to reduce the requirements of the mandate to bring its 
costs within the amount provided in the appropriations Act.
      Second, the House Amendment exempts appropriations bills 
and amendments thereto from the point of order.
      Section 101(a) of the Conference Substitute adds a new 
section 425(a)(2)(B)(iii) to the Budget Act, which adopts the 
Senate language with technical changes. In the House of 
Representatives and the Senate, the requirements of subclause 
(II) shall be considered as fulfilled by inclusion in the 
authorization bill of any procedural prescription to expedite 
consideration of the statement or legislative recommendations, 
including a requirement that the authorizing committee consider 
the statement or legislative recommendations on an expedited 
basis.
      If an agency submits a statement with a re-estimate of 
the direct costs of a mandate or legislative recommendations 
pursuant to section 425(a)(2)(B)(iii), the conferees expect the 
agency to submit this statement or legislative recommendations 
to CBO for its review and comment. The conferees expect the 
relevant agency to fully and freely share with CBO the 
information used in developing the re-estimate or the 
legislative recommendations for a less-costly mandate. CBO 
should make its review and comments available to Congress as 
appropriate.
      The agency is expected to consult with State, local, and 
tribal governments in preparing its re-estimate or its 
legislative recommendations for a less costly mandate.
            Determinations of Applicability of the Point of Order
      Section 101(a) of the Senate Bill adds a new Section 
408(c)(4) to the Budget Act that requires the Presiding Officer 
of the Senate to consult with the Senate Governmental Affairs 
Committee, to the extent practicable, on the applicability of 
the point of order in the Senate. Paragraph (5) provides that 
the levels of mandates for a fiscal year be determined on the 
basis of estimates by the Senate Budget Committee.
      Section 301(a) of the Senate Bill adds a new Section 
425(c) to the Budget Act that only provides that mandate levels 
be based on estimates made by the Budget Committees, in 
consultation with CBO.
      The Conference Substitute contains the Senate language as 
a new section 425 (d) and (e) of the Budget Act.

Sec. 426. Provisions Relating to the House of Representatives

      Section 101(a) of the Senate Bill adds a new Section 
408(d) to the Budget Act that makes it out of order in the 
House to consider a rule or order that waives the point of 
order established by S. 1.
      Section 301(a) of the House Amendment adds a new Section 
426 to the Budget Act that contains the same provision as the 
Senate Bill. Section 427 of the House Amendment establishes 
procedures for the disposition of the point of order in the 
House.
      The Conference Substitute contains the House language on 
House waivers of rules as a new section 426(a) of the Budget 
Act. Section 426(b) of the Substitute contains the House 
language on the House's disposition of points of order.
Sec. 427. Senator's requests for CBO cost estimates
      The Senate Bill requires CBO to prepare a cost estimate 
on a bill, joint resolution, amendment, or motion containing an 
intergovernmental mandate at the written request of any 
Senator.
      The House Amendment contained no such provision.
      Section 101(a) of the Conference Substitute adds a new 
section 427 to the Budget Act that narrows the Senate language 
so that it only applies to cost estimates for amendments that 
contain intergovernmental mandates. The conferees note CBO 
already responds to members requests for cost estimates to the 
extent practicable. Viewing the concern about the applicability 
of this point of order to amendments that would cause the 
intergovernmental mandate thresholds to be exceeded, however, 
the conferees have retained language requiring CBO, to the 
extent practicable, to prepare cost estimates for a Senator's 
amendment if it were to cause the thresholds to be exceeded.
      This more limited language is not intended to preclude 
CBO from preparing mandate cost estimates for bills. These 
requirements are already provided for in section 424 of the 
Substitute regarding reported bills and conference reports. 
Moreover, the conferees intend that CBO be responsive to 
Senator's requests in preparing cost estimates for bills and 
joint resolutions that may be marked up or for bills and 
resolutions that may be offered as amendments.
Sec. 428. Clarification on the application
      Section 101(a) of the Senate Bill adds a new subsection 
408(f) to the Budget Act, which clarifies that application of 
section 408 to legislation. If a legislative measure would 
reauthorize or amend existing statutes, the points of order 
established by the bill would apply only if the measure would 
either: (1) reduce net authorized financial assistance for 
complying with mandates by an amount that would cause a breach 
of the thresholds, without reducing duties by a corresponding 
amount: or, (2) otherwise increase the net aggregate direct 
costs of mandates by an amount that would cause a breach of the 
thresholds. The Senate Bill also provides that the net direct 
cost of Federal mandates in legislation means the net increase 
of those costs as compared to current law levels. If mandate 
legislation is extending an authorization of appropriations, 
the levels authorized in the mandate legislation are to be 
compared to the last year in which appropriations are 
authorized under current law.
      Section 301(a) of the House Amendment adds a new Section 
425(d) to the Budget Act that provides narrower language for 
limiting the application of part B.
      The Conference Substitute contains the Senate language as 
a new section 428 of the Budget Act.
Sec. 102. CBO assistance to committees and studies
      Section 102(l) of the Senate Bill amends section 202 of 
the Budget Act to add to CBO's responsibilities a requirement 
to assist committees in analyzing legislative proposals that 
may have significant budgetary impact on State, local, and 
tribal governments, or significant financial impact on the 
private sector. The Bill also amends section 202 of the Budget 
Act to require CBO to prepare studies at the request of the 
chairman or ranking minority member of a committee. Subsection 
(h)(1), regarding continuing studies, restates existing law. 
Subsection (h)(2) adds new provisions regarding mandate 
studies.
      Section 102(2) of the Senate Bill amends section 301(d) 
of the Budget Act to require committees to comment on mandate 
legislation as part of their views and estimates submissions to 
the Budget Committees.
      Section 301(a) of the House Amendment adds a new section 
424(b) and (c), which includes similar language as the Senate 
Bill except that the House Amendment requires CBO to assist 
committees in assessing mandate legislation that will have a 
significant employment impact on the private sector.
      The Conference Substitute contains the Senate language 
with an amendment to reflect the House language to require CBO 
to assist committees in assessing the impact of private sector 
mandates on employment. The Substitute drops the definition of 
employment for the purposes of this section.
Sec. 103. Cost of Regulations
      Section 103 of the Senate Bill express the sense of 
Congress that agencies should review planned regulations to 
ensure that they take CBO cost estimates into consideration. It 
also requires CBO, at the request of any Senator, to estimate 
the cost of regulations implementing mandate legislation and 
compare it with the CBO cost estimate for the legislation 
itself. It directs OMB to provide CBO with such data and cost 
estimates.
      The House Amendment contains no such provision.
      The Conference Substitute adopts the Senate language with 
an amendment to narrow the section in two respects. First, the 
section provides that the chairman or ranking minority member 
of a committee can request such a study, consistent with 
requests for mandate studies (section 102 of S. 1). Second, the 
section requires CBO to compare the agency's cost estimate to 
the estimate prepared by CBO when the legislation was 
considered. In preparing a comparison, the conferees intend 
that CBO critique the agency cost estimate in such comparison 
to make sure it is an accurate reflection of the cost of the 
mandate.
      The primary objective of the Unfunded Mandate Reform Act 
is to make sure Congress is adequately informed of the cost of 
mandates in legislation when they are considered. The conferees 
are particularly concerned about instances in which agencies 
exceed their discretion to impose regulations that are much 
more costly than anticipated when the legislation was 
considered. The intent of this section is to provide, when 
requested, a review of agencies' actions and estimates to make 
sure they are consistent with the costs of the mandate when 
Congress considered the legislation.
Sec. 104. Repeal of existing requirements for CBO mandate cost 
        estimates
      Section 106 of the Senate Bill repeals provisions in 
section 403 of the Budget Act that are superseded by Part B.
      Section 305 of the House Amendment contained similar 
language.
      Section 104 of the Conference Substitute contains the 
Senate language.
Sec. 105. Consideration for Federal funding
      Section 107 of the Senate bill provides that nothing in 
S. 1 denies federal funding to State, local, or tribal 
governments because they are already complying with all or part 
of a federal mandate.
      The House Amendment contains no such provision.
      The Conference Substitute contains the Senate language 
with a clarification that it applies to section 425(b)(2). The 
Conferees do not intend this section to create any legally 
binding duty to pay these governments, nor is it intended to 
affect the calculation of mandate estimates or Federal budget 
cost estimates.

Sec. 106. Impact on local governments

      Section 108 of the Senate Bill includes findings about 
cost shifting from Federal to State and local, and from State 
to local, governments, and resultant increases in property 
taxes and service cuts. This section states the sense of the 
Senate that these practices should cease and that curbing them, 
and reducing taxes and spending at all levels, are primary 
objectives of this Act.
      The House Amendment contains no such provision.
      The Conference Substitute adopts the Senate language as 
section 106.

Sec. 107. Enforcement in the House of Representatives

      The Senate Bill did not include language on enforcement 
in the House of Representatives.
      Section 302 of the House Amendment amends House Rule 
XXIII so that when the Committee of the Whole is considering an 
amendment that includes a provision that would have been 
subject to a point of order established by the bill, it will be 
in order to move to strike that provision, unless the special 
rule for considering the measure specifically prohibits the 
motion. The House Amendment also requires the Committee on 
Rules to list in its activities reports all special rules 
waiving points of order established by the bill, and the 
measures to which they related.
      The Conference Substitute contains the House language as 
section 107.

Sec. 108. Exercise of rulemaking

      Section 105 of the Senate Bill provides that certain 
provisions of S. 1 are enacted pursuant to the rulemaking power 
of each house.
      Section 303 of the House Amendment contains similar 
language.
      Section 108 of the Conference Substitute preserves the 
rulemaking authority of the houses.

Sec. 109. Authorization of appropriations

      Section 104 of the Senate authorizes $4.5 million 
annually through fiscal year 2002 for CBO to carry out this 
act.
      Section 421(e) of the House Amendment contains the same 
language.
      Section 109 of the Conference Substitute authorizes 
appropriations for CBO. The conferees note that this Act 
provides a major expansion in the responsibilities of CBO and 
recognize the need for additional funding in order for CBO to 
carry out these responsibilities. The conferees intend that 
these new responsibilities should not supplant CBO's existing 
responsibilities under the Budget Act.

Sec. 110. Effective date

      Section 109 of the Senate Bill provides an effective date 
of January 1, 1996, or 90 days after an appropriation for CBO 
authorized by the Bill becomes available.
      Section 306 of the House Amendment provides an effective 
date of October 1, 1995.
      The Conference Substitute contains the Senate language as 
section 110.

             Title II. Regulatory Accountability and Reform

Sec. 201. Regulatory process
      The Senate bill, in section 201, directs each agency, 
``to the extent permitted in law'', to assess the effects of 
regulations on State and local governments and the private 
sector, and to minimize regulatory burdens that affect the 
governmental entities. It authorizes the appropriation of such 
sums as are necessary to carry out this title.
      The House amendment, in section 201, contains a similar 
provision.
      The Conference substitute directs each agency, unless 
otherwise prohibited by law, to assess the effects of 
regulatory actions on State, local, and tribal governments and 
the private sector (other than to the extent that such 
regulations incorporate requirements specifically set forth in 
law).
Sec. 202. Statements to accompany significant regulatory actions
      The Senate bill, in section 202, requires that before 
promulgating any final rule that includes a Federal 
intergovernmental mandate that may result in aggregate costs to 
State, local, or tribal governments, and the private sector, of 
$100,000,000 or more in any one year, or any general notice of 
proposed rulemaking that is likely to result in such a rule, an 
agency must prepare a written statement. The statement must 
estimate anticipated costs to such governments and the private 
sector of complying with the intergovernmental mandate, as well 
as (to the extent that the agency determines that accurate 
estimates are reasonably feasible) the future compliance costs 
of the mandate, and any disproportionate budgetary effects of 
the mandate on any particular region of the nation or type of 
community. Also included in the statement must be a 
qualitative, and if possible, quantitative assessment of the 
costs and benefits anticipated from the intergovernmental 
mandate, the effect of the private sector mandate on the 
national economy, a description of the extent of prior 
consultation with State and local elected officials (or their 
designated representatives), a summary of the comments of such 
officials, a summary of the agency's evaluation of those 
comments, and the agency's position supporting the need to 
issue the regulation.
      The House amendment, in section 202, contains a similar 
provision with those same requirements, except that it applies 
to Federal mandates generally, and not just intergovernmental 
mandates, and the costs of $100,000,000 shall be of 
expenditures by States, local governments, or tribal 
governments, in the aggregate, or the private sector. In 
addition, it requires that the statement identify the provision 
of Federal law under which the rule is being promulgated, the 
disproportionate budgetary effects of the mandate on particular 
segments of the private sector, the effect of private sector 
mandates on the national economy, and the extent of the 
agency's prior consultation with designated representatives of 
the private sector.
      The Conference substitute adopts the House provision, 
along with a condition that the items in the written report be 
included ``unless otherwise prohibited by law''. This section 
does not require the preparation of any estimate or analysis if 
the agency is prohibited by law from considering the estimate 
or analysis in adopting the rule. Several other modifications 
to the House provision were made by the conferees. The rules to 
which the required statement applies are any general notice of 
proposed rulemaking that is likely to result in promulgation of 
any rule that includes a Federal mandate, or any final rule for 
which such notice was published. The substitute adds a 
requirement that there be a qualitative and quantitative 
assessment of the anticipated costs and benefits of the 
mandate, and an analysis of the extent to which such costs may 
be paid with Federal financial assistance. The requirement that 
the effect of private sector mandates on the national economy 
be included is amended, so that the limitation to ``private 
sector'' mandates is stricken. The requirement that the 
statement include the agency's position supporting the need to 
issue the regulation containing the mandate is dropped. Also, 
the requirement for a description of prior consultation drops 
both the reference to ``designated representatives'' and to 
``the private sector'', and instead refers to the ``prior 
consultation with elected representatives (under section 
204)''.
      It is the intent of the conferees that the rulemaking 
process shall follow the requirements of section 553 of title 
5, United States Code, and shall be subject to the exceptions 
stated therein. When a general notice of proposed rulemaking is 
promulgated, such notice shall be accompanied by the written 
statement required by section 202. When an agency promulgates a 
final rule following the earlier promulgation of a proposed 
rule, the rule shall be accompanied by an updated written 
statement. In all cases, the exceptions stated in section 553 
shall apply, including for good cause.
Sec. 203. Small government agency plan
      The Senate bill, in subsection 201(c), provides that 
before establishing any regulatory requirements that might 
significantly or uniquely affect small governments, agencies 
shall have developed a plan under which the agency provides 
notice to potentially affected small governments, enables 
officials of such governments to provide input, and informs and 
advises such governments on compliance with the requirements. 
Such sums as are necessary to carry out these requirements are 
authorized to be appropriated to each agency.
      The House amendment, in subsection 201(c), contains an 
identical provision.
      The Conference substitute retains this provision.
Sec. 204. State, local and tribal government input
      The Senate bill, in subsection 201(b), requires each 
agency, to the extent permitted in law, to develop an effective 
process to permit State, local and tribal elected officials (or 
their designated representatives) to provide meaningful and 
timely input into the development of regulatory proposals 
containing significant mandates. Such a process shall be 
consistent with all applicable laws.
      The House amendment, in subsection 201(b), contains a 
similar provision, but without the references to ``to the 
extent permitted in law'' and ``consistent with all applicable 
laws''.
      The Conference substitute requires each agency, to the 
extent permitted in law, to develop an effective process to 
permit elected officers (or their designated employees with 
authority to act on their behalf) of State, local and tribal 
governments to provide meaningful and timely input into the 
development of regulations containing significant 
intergovernmental mandates. It provides that the Federal 
Advisory Committee Act (FACA) shall not apply to such 
intergovernmental communications where the meetings are held 
exclusively between Federal officials and elected State and 
local officials (or their designated employees with authority 
to act on their behalf) acting in their official capacities, 
and where such meetings are solely to exchange views on the 
implementation of Federal programs which explicitly share 
intergovernmental responsibilities. The President shall issue 
guidelines to agencies on the implementation of this 
requirement, within 6 months.
      The conferees agree that an important part of efforts to 
improve the Federal regulatory process entails improved 
communications with State, local, and tribal governments. 
Accordingly, this legislation will require Federal agencies to 
establish effective mechanisms for soliciting and integrating 
the input of such interests into the Federal decision-making 
process. Where possible, these efforts should complement 
existing tools, such as negotiated rulemaking and/or the use of 
Federal advisory committees broadly representing all affected 
interests.
      The conferees recognize that FACA has been the source of 
some confusion regarding the extent to which elected officials 
of State, local, and tribal governments, or their designated 
employees with authority to act on their behalf, may meet with 
Federal agency representatives to discuss regulatory and other 
issues involving areas of shared responsibility. Section 204(b) 
clarifies Congressional intent with respect to these 
interactions by providing an exemption from FACA for the 
exchange of official views regarding the implementation of 
public laws requiring shared intergovernmental responsibilities 
or administration.
      Section 204(c) requires the President to issue guidelines 
and instructions to Federal agencies, consistent with other 
applicable laws and regulations, within six months of 
enactment. The conferees would expect the President to consult 
with the Director of the Office of Management and Budget (OMB) 
and the Administrator of General Services (GSA) before 
promulgating such guidelines.
Sec. 205. Least burdensome option or explanation required
      The Senate bill contains no such provision.
      The House amendment, in subsection 201(d), prohibits an 
agency from issuing a rule that contains a mandate if the 
rulemaking record indicates that there are two or more 
alternatives to accomplish the objective of the rule, unless 
the mandate is the least costly method or has the least 
burdensome effect, unless the agency publishes an explanation 
of why the more costly or more burdensome method was adopted.
      The Conference substitute requires that before 
promulgating any rule for which a written statement is required 
under section 202, an agency shall identify and consider a 
reasonable number of regulatory alternatives and select from 
them either the least costly, the most cost-effective, or the 
least burdensome alternative that achieves the objectives of 
the rule, unless either the agency head publishes an 
explanation of why this was not done or such a selection is 
inconsistent with law. The conferees intend that ``a reasonable 
number of regulatory alternatives'' means the maximum number 
that an agency can thoroughly consider without delaying the 
rulemaking process. The substitute also requires the OMB 
Director, within one year of enactment, to certify agency 
compliance with this section, and to include in the written 
explanation any agencies and rulemakings that fail to do so.
Sec. 206. Assistance to the Congressional Budget Office
      The Senate bill, in section 203, provides that the OMB 
Director shall collect from the agencies the statements 
prepared under section 202 and periodically forward copies to 
the CBO Director on a timely basis.
      The House amendment, in section 203, contains an 
identical provision.
      The Conference substitute retains this provision.
Sec. 207. Pilot program on small government flexibility
      The Senate bill, in section 204, requires the OMB 
Director to establish pilot programs in at least two agencies 
to test innovative and more flexible regulatory approaches that 
reduce reporting and compliance burdens on small governments, 
while meeting overall statutory goals and objectives. Any 
combination of proposed rules and rules in effect may be part 
of the pilot programs.
      The House amendment, in section 204, contains an 
identical provision.
      The Conference substitute retains this provision.
Sec. 208. Annual statements to Congress on agency compliance with 
        requirements of title II
      The Senate bill contains no such provision.
      The House amendment, in section 207, provides that the 
OMB Director shall annually submit written statements to 
Congress, detailing agency compliance with the requirements of 
its sections 201 (Regulatory Process) and 202 (Statements to 
Accompany Significant Regulatory Actions).
      The Conference substitute adopts the House requirement 
and applies it to compliance with all sections of this title.
Sec. 209. Effective date
      The Senate bill, in section 205, provides that this title 
shall take effect 60 days after the date of enactment.
      The House amendment would take effect upon enactment.
      The Conference substitute adopts the House effective date 
of upon enactment.

                 Title III. Review of Federal Mandates

Sec. 301. Baseline study of costs and benefits
      The Senate bill, in section 301, provides that within 180 
days, the Advisory Commission on Intergovernmental Relations 
(ACIR) shall begin a study of how to measure and define issues 
involved in calculating the total direct and indirect costs and 
benefits to State, local, and tribal governments of compliance 
with Federal law, and the direct and indirect benefits to such 
governments of Federal financial assistance and tax benefits. 
The study shall deal with issues related to the feasibility of 
measuring, and how to measure, such items.
      The House amendment contains no similar provision.
      The Conference substitute adopts the Senate language, 
except that the study is to be completed within 18 months 
rather than started within 180 days.
Sec. 302. Report on Federal mandates by Advisory Commission on 
        Intergovernmental Relations
      The Senate bill, in section 302, requires ACIR to study 
the role of unfunded Federal mandates in intergovernmental 
relations, and to make recommendations regarding allowing 
flexibility in complying with specific mandates, reconciling 
conflicting mandates, terminating duplicative or obsolete 
mandates, suspending mandates that are not vital to public 
health and safety, consolidating or simplifying mandates, and 
establishing common definitions or standards to be used in 
complying with Federal mandate. To the extent practicable, the 
specific unfunded mandate to which a recommendation applies 
should be identified. One of the existing Federal mandates that 
ACIR is to study and make specific recommendations on is the 
Federal requirement that State, local, and tribal governments 
utilize metric systems of measurement. Within 60 days of 
enactment of this Act, ACIR is required to issue proposed 
criteria under this subsection, and then to allow 30 days for 
public comment, with adoption of the final criteria not later 
than 45 days after the issuance of the proposed criteria. 
Within 9 months of enactment, ACIR is required to publish a 
preliminary report on its activities under this title, 
including its recommendations, and then to hold public hearings 
on these preliminary recommendations. Not later than 3 months 
after publication of the preliminary report, ACIR shall submit 
to Congress and the President a final report on its findings, 
conclusions, and recommendations under this section.
      The House amendment, in section 101, contains nearly 
identical provisions, except that it also requires ACIR, when 
studying the role of unfunded Federal mandates, to review their 
impact on the competitive balance between State and local 
governments, and the private sector, to review the role of 
unfunded State mandates imposed on local governments and the 
private sector, and to review the role of unfunded local 
mandates imposed on the private sector. Definitions of ``State 
mandate'' and ``local mandate'' are provided. It also requires 
that ACIR make recommendations regarding the establishment of 
procedures to ensure that when private sector mandates apply to 
entities that compete with State or local governments, any 
relief from unfunded Federal mandates is applied in the same 
manner and the same extent to both. In addition, ACIR is 
instructed to give highest priority to mandates that are the 
subject of judicial proceedings between the United States and a 
State, local, or tribal government. The House amendment 
contains no provision regarding the metric system of 
measurement.
      The Conference substitute retains the Senate provisions, 
and adds the House requirements for a review of the impact on 
competitive balance and a review of the role of unfunded State 
mandates imposed on local governments (only), as well as the 
provision placing highest priority on mandates that are the 
subject of intergovernmental judicial proceedings. It also 
includes a modification of a House requirement, so that ACIR 
shall make recommendations on mitigating any adverse impacts on 
the private sector that may result from relieving State and 
local governments of mandates, and the feasibility of applying 
relief from mandates in the same manner to both the private 
sector, and State and local governments. The House definition 
of ``State mandate'' is also retained. In addition, a provision 
is added requiring that, to the extent practicable, any 
negative impact on the private sector that may result from 
implementation of a recommendation be identified.
      The conferees intend that ACIR have flexibility to review 
a wide array of federal requirements on State and local 
governments. These requirements may include conditions of 
federal assistance, such as those attached to the receipt of 
Federal grants, or direct orders like emissions testing 
requirements, carpool mandates, and national voter registration 
directives that are not tied to the receipt of Federal funds.
Sec. 303. Special authorities of Advisory Commission
      The Senate bill, in section 303, provides authority to 
the ACIR, for purposes of carrying out this title, to procure 
temporary and intermittent services of experts or consultants, 
to receive on a reimbursable basis detailees from Federal 
agencies, and to contract with and compensate government and 
private persons for property and services.
      The House amendment, in section 102, contains the same 
provisions, as well as a provision authorizing ACIR to receive 
on a reimbursable basis administrative support services from 
the General Services Administration.
      The Conference substitute adopts the House language.
Sec. 304. Annual report to Congress regarding Federal court rulings
      The Senate bill contains no such provision.
      The House amendment, in section 205, provides that ACIR 
shall annually submit to Congress a report describing Federal 
court rulings in the preceding year which imposed an 
enforceable duty on one or more State, local, or tribal 
governments.
      The Conference substitute modifies the House provision, 
by requiring that the report describe any Federal court case to 
which a State, local, or tribal government was a party in the 
preceding year that required them to undertake responsibilities 
beyond those they would otherwise have undertaken, to comply 
with a Federal statute or regulation.
Sec. 305. Definition
      The Senate bill contains no such provision.
      The House amendment, in section 103, defines, for 
purposes of this title, ``Advisory Commission'' to mean the 
Advisory Commission on Intergovernmental Relations, and 
``Federal mandate'' to mean any provision in statute or 
regulation or any Federal court ruling that imposes an 
enforceable duty upon States, local governments, or tribal 
governments including a condition of Federal assistance or a 
duty arising from participation in a voluntary Federal program.
      The Conference substitute retains the House definition of 
``Federal mandate'', but adds at the beginning of it the phrase 
``Notwithstanding section 3 of this Act,''.
Sec. 306. Authorization of appropriations
      The Senate bill, in section 304, provides an 
authorization of appropriations of $1,250,000 for each of 
fiscal years 1995 and 1996 to ACIR for the purposes of carrying 
out sections 301 and 302.
      The House bill provides no authorization of 
appropriations.
      The Conference substitute provides an authorization of 
appropriations of $500,000 for each of fiscal years 1995 and 
1996 to ACIR to carry out sections 301 and 302.

                  committee report on judicial review

      The purposes of Section 401 are as follows. Section 
401(a) (1) and (2) would allow court review only to redress a 
failure of an agency to prepare the written statement 
(including the preparation of the estimates, analyses, 
statements or descriptions) required to be included in such 
statement under Section 202 or the written plan under Section 
203(a) (1) and (2). A reviewing court may not review the 
adequacy of a written statement prepared under Section 202 or a 
written plan under Section 203(a) (1) and (2). Challenges to an 
agency's failure to prepare a written statement under Section 
202 or a written plan under 203(a) (1) and (2) may be brought 
only under Section 706(1) of the Administrative Procedures Act 
and may not be brought until after a final rule has been 
promulgated.
      Section 401(a)(3) prohibits any court in which review of 
a completed rulemaking action is sought from staying, enjoying, 
invalidating or otherwise affecting the effectiveness of an 
agency's rulemaking for failure to comply with the requirements 
of Section 202 and Section 203(a) (1) and (2) of this Act. This 
is true not only under Section 401(a)(3), which regards review 
of rules under other provisions of law, but also under Section 
401(a)(1), which only authorizes a court to compel the agency 
to prepare a written statement, but does not authorize a court 
to stay, enjoin, invalidate, or otherwise affect a rule.
      It is the intent of the Conference Committee that if an 
agency prepares the statements, analysis, estimates or 
descriptions under Section 202 and the written plan under 
Section 203(a) (1) and (2) for purposes of its rulemaking 
pursuant to the underlying statute, a court may, if pursuant to 
the review permitted under such statute, consider the adequacy 
of such information generated. Section 401(a)(4) provides that 
information generated under Section 202 and Section 203(a) (1) 
and (2) is not subject to judicial review pursuant to this Act 
under Section 706(2) of the Administrative Procedures Act. 
Section 401(a)(4) does allow that such information may, in 
accordance with the standards and process of the underlying 
statute, be part of the agency's rulemaking record subject to 
judicial review pursuant to the underlying statute. Any such 
information that is part of the record for judicial review 
pursuant to the underlying statute. Any such information that 
is part of the record for judicial review pursuant to the 
underlying statute may be subject to review under Section 
706(2) of the Administrative Procedures Act (or other 
applicable law) and can be considered by a court, to the extent 
relevant under the underlying statute, as part of the entire 
record in determining whether the record before it supports the 
rule under the ``arbitrary and capricious'' or ``substantial 
evidence'' standard (whichever is applicable). Pursuant to the 
appropriate Federal law, a court should look at the totality of 
the record in assessing whether a particular rulemaking 
proceeding lacks sufficient support in the record. The 
provisions of this Act do not change the standards of 
underlying law, under which courts will review agency rules.
      Section 401(a)(5) provides that, for any action under 
Section 706(1), the provisions of the underlying Federal 
statute relating to all other matters, such as exhaustion of 
remedies, statutes of limitations and venue, shall continue to 
govern, notwithstanding the additional requirements on agencies 
that Title II of this Act imposes. If, however, such underlying 
Federal statutes does not have a statute of limitations that is 
less than 180 days, then for review of agency rules under 
Section 706(1) that include the requirements set forth in 
Section 202 or Section 203(a) (1) and (2), the time for filing 
an action under Section 706(1) is limited to 180 days.
      Finally, Section 401(b)(1) makes it clear that except as 
provided in Section 401(a), no other provision or requirement 
in the Act is subject to judicial review. Title I, those 
portions of Title II not expressly referenced above, and Title 
III are completely exempt from any judicial review. Section 
401(b)(2) states that, except as provided in Section 401(a), 
the Act creates no right or benefit that can be enforced by any 
person in any action. Section 401(a)(6) states that any agency 
rule for which a general notice of proposed rulemaking has been 
promulgated after October 1, 1995 shall be subject to judicial 
review as provided in Section 401(a)(2) (A) and (B).

                                       U.S. Senate,
                                   Office of the Secretary,
                                                    March 10, 1995.
Hon. Dirk Kempthorne,
U.S. Senate,
Washington, DC.
      Dear Senator Kempthorne: Per our conversation of March 9, 
1995, I am writing to confirm that in the counting of days in 
the U.S. Senate, a sine die adjournment will result in the 
beginning again of the day counting process and that the sine 
die adjournment of a Congress results in all legislative action 
being terminated and any process ended so that it must begin 
again in a new Congress.
      Hoping this may be of help. I remain,
            Sincerely,
                                            Robert B. Dove,
                                      Parliamentarian, U.S. Senate.

                                   William F. Clinger,
                                   Rob Portman,
                                   David Dreier,
                                   Tom Davis,
                                   Gary Condit,
                                   Cardiss Collins,
                                   Edolphus Towns,
                                   Joe Moakley,
                                 Managers on the Part of the House.

                                   Dirk Kempthorne,
                                   Bill Roth,
                                   Pete V. Domenici,
                                   John Glenn,
                                   J.J. Exon,
                                Managers on the Part of the Senate.