Last week was a largely unremarkable one on the regulatory front. There were 11 rulemakings with some quantified economic impact in the pages of the Federal Register. Most of these, however, were fairly limited actions. The most notable measure of the bunch was an Environmental Protection Agency (EPA) rule regarding emissions from steel plants. Across all rulemakings, agencies published $128 million in total costs and added 311,851 annual paperwork burden hours.

REGULATORY TOPLINES

• Proposed Rules: 52
• Final Rules: 63
• 2023 Total Pages: 58,400
• 2023 Final Rule Costs: $85.2 billion
• 2023 Proposed Rule Costs: $360 billion

NOTABLE REGULATORY ACTIONS

The most significant rulemaking of the week was the EPA rule regarding “New Source Performance Standards Review for Steel Plants: Electric Arc Furnaces and Argon-Oxygen Decarburization Vessels.” Specifically, EPA “is finalizing amendments to the new source performance standards (NSPS) for electric arc furnaces (EAF) and argon-oxygen decarburization (AOD) vessels in the steel industry pursuant to the review required by the Clean Air Act.” As EPA rules go, however, this one is relatively restrained. Per the rule’s “Economic Impact Analysis,” the agency estimates roughly $100 million in present value costs across a 10-year period, or $15 million on an annualized basis.

TRACKING THE ADMINISTRATIONS

As we have already seen from executive orders and memos, the Biden Administration will surely provide plenty of contrasts with the Trump Administration on the regulatory front. And while there is a general expectation that the current administration will seek to broadly restore Obama-esque regulatory actions, there will also be areas where it charts its own course. Since the AAF RegRodeo data extend back to 2005, it is possible to provide weekly updates on how the top-level trends of President Biden’s regulatory record track with those of his two most recent predecessors. The following table provides the cumulative totals of final rules containing some quantified economic impact from each administration through this point in their respective terms.The EPA Decarburization rule discussed above provided the bulk of the Biden Administration’s $182.5 million increase in its final rule cost total. There was not much else that was all that earth-shattering across either of the other two administrations, either. The Trump Administration saw its cost total increase by nearly $265 million, due almost entirely to a Securities and Exchange Commission rule. Meanwhile, the Obama Administration saw its paperwork total jump by more than 756,000 hours, with a Department of Health and Human Services rule regarding “Responsibility of Applicants for Promoting Objectivity in Research” being the primary reason.

THIS WEEK’S REGULATORY PICTURE

This week, the Food and Drug Administration (FDA) finds some potential savings for producers of canned tuna.Source: Photo by kate estes on Unsplash

Last Friday, FDA published a proposed rule entitled “Fish and Shellfish; Canned Tuna Standard of Identity and Standard of Fill of Container.” As with so many products, it is the agency’s charge to set standards for what goes into a given food container and how affected producers confirm that a given container holds the advertised product. In this instance, FDA is proposing to allow tuna canners to: 1) include a wider array of seasonings and other ingredients in these products, and 2) “replace the pressed cake weight method with the drained weight method to determine the standard fill of container.” The latter change will apparently yield cost savings to such producers and better align with international market norms.

As discussed in the proposal’s “Regulatory Impact Analysis,” moving from the “pressed cake” test to the “cake weight” test will cut the average per-can fill test process from five minutes to two minutes. FDA then extrapolates that difference out across the typical operations of a tuna canner and finds that the baseline cost of the “pressed cake” method is roughly $16.5 million annually whereas the costs involved in the “cake weight” procedure come out to only $6.6 million per year, nearly $10 million in net savings. When discounted over a 10-year horizon, FDA estimates that these savings come out to roughly $55.4 million in net present value.

Beyond the substance of the rulemaking, however, there is also an interesting procedural aspect to it. The proposal comes as the result of a 2015 “citizen petition” to FDA from “Bumble Bee Foods, LLC, StarKist Co., and Tri Union Seafoods, LLC (dba Chicken of the Sea).” Granted, taking roughly eight years to act on such a petition may seem like quite a wait, but it is important to also recognize as a matter of perspective how long the original overall standards for canned tuna have been around. As FDA notes:

Standards of identity and fill of container were established for canned tuna in 1957 (see 22 FR 892, February 13, 1957). Although the standards have been amended several times, certain requirements appear to be outdated. We tentatively conclude that amending these requirements in the standards will promote honesty and fair dealing in the interest of consumers.

Interested parties have until November 24 to submit comments on the matter.

TOTAL BURDENS

Since January 1, the federal government has published $445.2 billion in total net costs (with $85.2 billion in new costs from finalized rules) and 166.4 million hours of net annual paperwork burden increases (with 15.4 million hours in increases from final rules).