NFPA Journal - May/June 2017 - 26

Washington, D.C. by Gregory B. Cade

THE NFPA
VIEW FROM
CAPITOL HILL

Cost/Benefit
AN EXECUTIVE ORDER TO REDUCE REGULATIONS AND THEIR RELATED
COSTS COULD BE A BIG DEAL FOR STANDARDS DEVELOPERS

f the many executive

order directs to develop implementation
orders signed by President
guidance for agencies, and NFPA will cerTrump in his first months
tainly want to participate in that debate
in office, one signed at the
when the guidance is issued.
end of January could have
Obviously, of major interest will
a big potential impact on NFPA and other
be guidance on the methodologies to
standards development organizations.
measure the cost of regulations. Under
The order, "Reducing Regulations
current law, federal agencies are required
and Controlling Regulatory Costs," has
to use voluntary consensus standards,
informally been referred to as the "One
developed by the private sector, whenNew In, Two Old Out" rule because it
ever possible to carry out regulatory
will require federal agencies to repeal
objectives. Thus, as agencies tally up
at least two existing regulations before
the cost of the regulations within their
NFPA does not
enacting any new regulation. More than
jurisdictions, the costs (and benefits)
require technical
that, though, it will require federal
of following those standards, many
committees to
agencies to strictly control the costs
of which are quite old, will have to be
develop estimated
imposed by any new regulatory action.
accounted for. This cost-benefit exercise
code compliance
While this will have an impact going
will also need to be performed for any
costs. There might not
forward, it also means agencies will
new regulation.
be data available to
have to review the total costs of existAt the moment, NFPA does not foraffirm or dispute cost
ing rules already in place in the Code
mally require technical committees to
calculations compiled
of Federal Regulations (CFR), many of
develop and document the estimated
by an agency.
which incorporate NFPA standards by
cost of complying with a code or stanreference.
dard, which means there might not
The requirement to conduct an
be any data available to affirm or disaccounting across the entire CFR, and
pute cost calculations compiled by an
to keep the cost static, is new and raises
agency. Moreover, in a number of cases,
a number of questions. One of those questions is how "costs" a standard may present more than one option for compliwill be determined. The lack of definition in the order leaves ance, creating more complexities for attempts to calculate
it unclear whether the accounting of "costs" added by new costs. Depending on how this process is carried out, NFPA
regulations is the costs alone, or the net costs-those offset and our stakeholders will have to be active in ensuring that
by the benefits. Also, even though the order contains a "one both the accounting methodology and data are reasonable
in, two out" provision, there is no explicit mention of how and take into account the safety benefit inherent in comthis should relate to cost or whether an agency must elim- pliance with consensus codes and standards developed by
inate two rules with similar cost burdens as the one to be top experts.
implemented.
There is much about these issues that remains uncertain at
It is also unclear whether the two to be phased out must this point. As the next steps play out, though, NFPA will work to
originate from the same agency as the one to be imposed. ensure that the federal safety regulations that protect workers
Implementation of the order will likely be made more chal- and ordinary citizens stay in force and continue to address
lenging by the fact that many regulations are mandated by law. safety challenges as they arise.
These and many other questions will have to be answered by
the White House Office of Management and Budget, which the GREGORY B. CADE is division director of government affairs for NFPA.

26 | NFPA JOURNAL * M A Y / J U N E 2 0 1 7

MICHAEL HOEWELER

Table of Contents for the Digital Edition of NFPA Journal - May/June 2017