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CONSULTATION WITH STATE AND LOCAL GOVERNMENTS IN DEVELOPMENT OF FEDERAL REGULATIONS

DAO 201-9: CONSULTATION WITH STATE AND LOCAL GOVERNMENTS IN DEVELOPMENT OF FEDERAL REGULATIONS
Number: DAO 201-9
Effective Date: 1971-09-27

SECTION 1. PURPOSE.

This Order prescribes procedures that shall apply in carrying out the provisions of OMB Circular No. A-85, "Consultation with heads of State and local governments in development of Federal regulations." The "Circular," (Appendix A to this Order), requires that State and local governments be given a reasonable opportunity to comment on proposed major regulations, major interagency agreements, and major organizational changes which have significant and nationwide effect on them. It provides for assistance by the Advisory Commission on Intergovernmental Regulations (ACIR) in arranging to obtain State and local advice and comment on such matters.

SECTION 2. RESPONSIBILITIES.

.01 The Assistant Secretary for Administration shall continue to be responsible for seeing that the provisions of the Circular are carried out. The Departmental Office of Management and Organization (OMO) shall assist the Assistant Secretary for Administration and shall serve as the point of contact for operating units seeking guidance on the provisions of the Circular or this Order.

.02 The head of each primary operating unit shall be responsible for (a) determining the applicability of the requirements of the Circular to regulations, interagency agreements, and organizational changes that he proposes be issued, signed, or approved relating to the functions under him, and (b) for processing such proposed actions so as to meet the requirements provided herein.

SECTION 3. COVERAGE.

Paragraph 4 of the Circular indicates the kinds of materials that are intended to be covered by the requirements of the Circular. Operating units should be guided by the following supplementary instructions:

a. Regulations means any rules, regulations, standards, procedures, and guidelines proposed to be issued that will likely have the indicated effect on State and local governments. These are required to be published in the Federal Register, either as part of the Code of Federal Regulations (for general or permanent regulations) or in other appropriate form.

b. Interagency agreements which will likely have the indicated effect on State and local governments come under the requirements regardless of the organizational levels of the signing officials.

c. Organizational changes which come under the requirements are limited to changes in Department Organization Orders, provided such changes will likely have the indicated effect on State and local governments.

SECTION 4. PROCEDURES.

.01 Regulations.

a. For applicable regulations that the head of an operating unit is authorized to issue, he, or his designee, shall submit the proposed regulations directly to the ACIR in the manner specified in subparagraph 5.a. of the Circular. The operating unit shall also send one copy of the complete transmittal t the Director, OMO.

b. For applicable regulations beyond the authority of the head of an operating unit to issue over his own signature, the operating unit head shall first obtain appropriate Departmental clearances before proceeding as provided in subparagraph a. above.

c. Following submission to ACIR, the operating unit shall take subsequent actions concerning the proposed regulations in accord with the procedures specified in the Circular. For regulations not within the authority of the operating unit head to issue over his signature, he shall consult with the appropriate Departmental official or officials before rejecting any major change suggested by a State or local government association. The operating unit shall sent to OMO a copy of the notification of rejection to an association of any major change it suggested.

d. Upon issuance of the final regulations, the operating unit shall sent a copy to OMO together with a summary of the actions taken with respect to comments received or meetings held following ACIR referrals.

.02 Interagency Agreements.

Because of the infrequency and special nature of interagency agreements, a general procedure for handling applicable proposed agreements is not being specified. Line or staff officials principally responsible for initiating such agreements or collaborating with other agencies in drawing up such agreements shall process such agreements in coordination with the other agency or agencies involved in a manner that will comply with the spirit of the Circular as well as with its procedural requirements. The official of the Department who will ultimately sign the prospective agreement shall be fully apprised by the submitting office of the actions taken and of the disposition or proposed disposition of suggested major changes received in connection with observing the consultation requirements of the Circular. The office initiating or otherwise principally responsible for the prospective agreement within Commerce shall send OMO a copy of all significant communications concerning the agreement as pertain to the requirements of the Circular, so that upon completion of the matter OMO will have, in effect, a complete summary history of compliance with the Circular.

.03 Organizational Changes.

a. For planned applicable organizational changes, the head of the operating unit proposing the change shall submit the proposed change to OMO for appropriate Departmental clearances prior to submission of the proposed change to ACIR. The submission to OMO should be in the form of a statement, ultimately to go to ACIR, that is sufficiently descriptive of the existing structure and the nature of the planned change and its likely significant and nationwide impact on State and local government s will enable such organizations to understand the import of the proposed change. Draft amendments or revisions to Department Organization Orders need not be submitted with the statement, although the submitting office may elect t do so if such will facilitate understanding the nature and significant of the proposed change.

b. Upon receipt of notice of Departmental clearance from OMO, the operating unit shall submit the statement of the proposed change to ACIR in the manner specified in subparagraph 5.a. of the Circular, and shall send a copy of the transmittal to OMO.

c. Comments received for consideration following ACIR referrals or in connection with such meetings on the matter as ACIR may arrange shall be reviewed by the operating unit head who shall, if he proposes not to accept any major suggestion received, prepare the notification letter or letters required by subparagraph 5.e. of the Circular. He shall submit each proposed notification letter to OMO, with appropriate explanation, for Departmental clearance prior to signing and dispatching the letter to the addressee. Unless a meeting is then requested as provided in subparagraph 5.e. of the Circular, the operating unit may then submit the proposed change to the appropriate Department Organization Order in accord with established procedures for changing such Orders.

d. In all cases where a referral to ACIR was involved, the operating unit shall, upon submitting to the Office of the Secretary a proposed amendment or revision to a Department Organization Order, summarize in the submission the results or proposed final actions to be taken on any suggestions received for major organization changes.

e. In connection with proposed organizational changes referred to ACIR, operating unit should consult with appropriate units in the Office of the Secretary to work out as hoc collaborative arrangements, supplementary to the procedures set forth herein, to facilitate consideration of suggestions that may be received and compliance with requirements of the Circular.

SECTION 7. EFFECT ON OTHER ORDERS.

This Order supersedes Secretary's Circular 12, dated July 28, 1967.

Signed by: Secretary of Commerce

Index Changes:

Add:

Advisory Commission on Intergovernmental Relations (ACIR) 201-9

Bureau of the Budget Circulars

A-85 Consultation with heads of State and local governments in development of Federal Regulations 201-9

Local governments, consultation with 201-9

Regulations, State and local governments, affecting 201-9

State governments, consultation with 201-9

APPENDIX A DAO 201-9

September 27, 1971

EXECUTIVE OFFICE OF THE PRESIDENT

OFFICE OF MANAGEMENT AND BUDGET

WASHINGTON, D.C. 20503

January 20, 1971 CIRCULAR NO. A-85 Revised

TO THE HEADS OF EXECUTIVE DEPARTMENTS AND ESTABLISHMENTS

SUBJECT: Consultation with heads of state and local governments in development of Federal regulations

1. Purpose. This Circular, in accordance with certain general purposes of Title IV of the Intergovernmental Cooperation Act of 1968 (P.L. 90-577), provides that the chief executives of State and local governments will be given a reasonable opportunity to comment on major proposed Federal rules, regulations, standards, procedures and guidelines (hereafter called regulations), major interagency agreements concerning program operations and major organizational changes, any of which have a significant and nationwide effect on State and local governments. This Circular also provides for assistance by the Advisory Commission on Intergovernmental Relations (ACIR) in arranging to obtain State and local advise and comment on such matters, in cooperation with State and local general government associations. Circular No. A-85, dated June 28, 1967, is superseded by this revision.

2. Background. Federal agencies administering assistance and other programs affecting State and local government normally issue regulations under which those programs are administered. These regulations may affect the conduct of State and local affairs, including management and organization, planning, program adjustments, and fiscal and administrative systems. Federal requirements may not be consistent among Federal agencies or permit needed flexibility for State and local governments. Heads of State and local governments, therefore, should be afforded an opportunity to comment on Federal regulations prior to issuance and certain Federal interagency agreements and organizational changes prior to implementation.

3. Policies. Agencies will be guided, to the fullest practical extent consistent with Federal laws, by the following practices:

a. Whenever possible, agencies should engage in necessary consultation well in advance of the formal development and submittal of materials under this Circular so as to minimize the need for extensive review and discussion at the final stages of the development of regulations.

b. The central coordinating role of heads of State and local governments, including their role of initiating and developing State, regional, and local programs, will be supported and strengthened.

c. Federal regulations should not hamper the heads of State and local governments in providing effective organizational and administrative arrangements and in developing planning, budgetary, and fiscal procedures responsive to needs.

d. Duplication of reporting requirements and controls which are established by State and local governments will be avoided, and Federal agencies should rely wherever possible on internal or independent audits performed at the State and local level as provided in Circular No. A-73, dated August 4, 1965.

e. Except as may be required by law or special circumstances, agency regulations dealing with like matters procedures and information needed for determining eligibility in like cases) will be consistent both internally and with practices of other agencies.

4. Coverage. This Circular applies to major agency regulations and revisions thereof, major interagency agreements concerning program operations and major organizational changes, any of which have a significant and nationwide effect on State and local governments, including quasi-public agencies (e.g., urban renewal agencies), and which directly affect one or more of the following:

a. Interstate relationships,

b. Intergovernmental relationships (e.g., State-local and interlocal),

c. Types of eligible recipients,

d. Designations of agencies within State or local governments,

e. Requirements affecting State and local personnel practices,

f. Organizational, planning, or fiscal activities of State and other governments, and

g. Roles and functions of heads of State or local governments.

5. Procedures for informing State and local government associations of proposed new or revised regulations, and significant organization changes having a nationwide effect.

a. The issuing agency will provide to the ACIR at least 20 copies and summaries of the proposed regulation or proposed organization change (in the case of interagency agreements, one of the parties to the agreement will take the lead in providing the necessary copies). This should be done not less than 45 days and, if practical, 60 days before the intended date of promulgation. Also, this should generally be done in advance of publication of proposed regulations in the Federal Register, although it may be necessary in some circumstances to have such publication occur simultaneously with or prior to the completion of the review process provided for in this Circular. If special legal or other circumstances do not permit at least 45 days for such notice and comment, the agency will advise the ACIR of the time available and provide at least 60 copies of a summary on abstract in lieu of the full draft text of the regulation. Such summaries should describe the nature and significance of any changes in existing policies affecting State and local governments.

b. The ACIR will promptly transmit copies of the agency materials to each of the following State and local government associations: National Governors' Conference, Council of State Governments, International City Management Association, National Association of Counties, National League of Cities, and United States Conference of Mayors. Other groups representing central management units may be sent copies of material of concern to them. ACIR will also transmit a copy to the Office of Management and Budget.

c. Unless an earlier response is essential, the State and local government associations will be given a minimum of 30 days after receiving agency materials in which to comment, addressing comments directly to the Federal agency concerned, and transmitting copies to the ACIR and the Office of Management and Budget.

d. If requested either by the Federal agency concerned or by a State or local government association, the ACIR will arrange a meeting between representatives of the agency and the association (along with State or local chief executives or their representatives, where desirable) to consider the comments offered on the proposed regulations or organization changes.

e. If the agency does not accept major changes suggested by a State or local government association, it will promptly notify the association in writing of its decision, and will send a copy of the notification to the ACIR and the Office of Management and Budget. Within three days of receipt of notification, the State or local government association may request the ACIR to arrange a prompt meeting between representatives of the agency and the association to consider modifications of the proposed regulations. ACIR will notify the Office of Management and Budget of such a meeting.

f. When appropriate and desirable, the Office of Intergovernmental Relations shall also be advised of, and participate in any discussions and meetings under this paragraph.

g. The agency will supply seven copies of the regulation, when issued in final form to the ACIR for distribution to the State and local government associations.

h. Each agency should promptly designate one official to see that these provisions are carried out, and inform the State and local government associations, the Office of Management and Budget and the ACIR of the name of the official.

6. Additional functions of the ACIR.

a. The ACIR is prepared to assist agencies in developing new regulations covered by this Circular and will assist in assuring that regulations dealing with like matters are consistent, as provided in paragraph 3(d).

b. By January 31 of each year, the ACIR will make a report to the Director of the Office of Management and Budget concerning operations under this Circular during the preceding calendar year. Copies of the report will be furnished to each agency and the associations representing general units of State and local government.

7. General considerations. This Circular deals only with limited aspects of intergovernmental consultation: the development of regulations and organizational changes which significantly affect State and local governments. The circular is not intended to limit the consultation process to these aspects of the intergovernmental problem. Well in advance of the stage of promulgating formal regulations or implementing significant organizational changes, consultation should be pursued actively with heads of State and local governments so that consultation need not be concentrated in a brief period prior to the proposed action. This is especially important in the case of new programs where consultation should include briefings on the nature and significance of such programs.

On the other hand, the Circular is not intended to limit the ability of agencies to carry out their mission responsibilities. It is not intended that all proposed regulations or revisions or organizational changes will be automatically channeled through the procedure called for in this Circular; no purpose would be served by creating congestion and delay. Judgment must be exercised by the agencies and by the State and local governments in applying the Circular and selectivity will be needed in determining which substantive and administrative regulations and organizational changes are significant enough to be put through the consultation arrangements.

This Circular is addressed primarily to new regulations or revisions of existing Federal regulations. However, agencies will give consideration to requests from heads of State and local governments to review and revise regulations already in effect, and to consult on such regulations with such officials on request.

8. Effective date. The provisions of this Circular become effective immediately.

GEORGE P. SHULTZ

DIRECTOR

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