The End of Regulating Behind Closed Doors

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Washington, July 14, 2017 | Beth Breeding (202-225-5431) | comments
Wouldn’t you want to know how the outcome of settling a lawsuit would impact you? Odds are that the answer is yes, especially if it means significant costs for the business where you work or changes in operations that could cost jobs. But through a legal maneuver called “sue and settle” used by activist groups and past administrations, settlements are often written behind closed doors without the input of those affected. By the time the settlements see the light of day, it’s normally too late for anyone who opposes the resulting agreement to do a thing about it. That just doesn’t sit right with me.

The problem of sue and settle, while not a practice that began during the Obama Administration, is clearly one that reached new highs during the Obama years. Oftentimes, we saw a federal agency – like the Environmental Protection Agency (EPA) – sued by a nonprofit environmental organization that wanted them to change a policy or practice. Frequently, those who feel the impacts of these regulations – like our nation’s job creators – do not know about the deals that typically stem from negotiations between the agency and the plaintiffs seeking to force new regulations until the proposed decrees or settlements are filed in court. By then, regulated businesses, state regulators, and other interested entities are unlikely to be able to intervene in the litigation. The court can approve the deals before regulated parties even have an opportunity to determine whether new regulatory costs will be imposed on them. One example that has impacted Virginia includes decrees and agreements that required the EPA to issue regulations on water flowing into the Chesapeake Bay that have triggered billions of dollars in costs.

While current EPA Administrator Pruitt has signaled that the agency intends to end the use of this practice, fixing the law to permanently prevent it is the surefire way to help deliver relief from red tape. The Sunshine for Regulatory Decrees and Settlements Act puts an end to the abuse of this practice. It assures that those being regulated have a fair opportunity to participate in the resolution of lawsuits that affect them and that courts have all the information they need before they approve proposed settlements. It also provides needed transparency on the ways agencies conduct their business. The House Judiciary Committee, which I chair, recently approved this bill, and I hope to see it before the full House for a vote soon.

The drag of new regulations, too often issued without sufficient consideration of their costs, benefits, and impacts on jobs, holds back economic recovery. The Sunshine Act is a timely solution to a real and important problem. By ensuring greater transparency and accountability, this bill is another common sense solution the Committee is taking up to curb regulatory abuse so that America’s job creators and innovators aren’t buried under mountains of job-killing regulations.
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