Removing Barriers Blog

White House Issues Government-wide Regulatory Freeze
Posted January 22, 2017 by CUNA Advocacy

On the night of the Inauguration the Trump Administration issued a regulatory freeze in a memo from Chief of Staff Reince Priebus to the heads of Executive departments and agencies. The memo notes that it is for the purpose of allowing the President's appointees or designees to have the opportunity to review any new or pending regulations. Such a directive is not unprecedented, with the Obama Administration having issued something similar in 2009 from White House Chief of Staff Rahm Emanuel.

Some of the key takeaways from the memo are as follows:

  • It directs that regulations that have been sent to the Office of the Federal Register (OFR) but not published in the Federal Register, should be immediately withdrawn from OFR for review and approval. (Note the memo allows exceptions to be made to this - emergency situations or other urgent circumstances relating to health, safety, financial, or national security matters. An agency head appointed or designated by the President after noon on January 20, 2017, can review and approve the regulation. The department or agency head may also delegate this power of review and approval to any other person so appointed or designated by the President, consistent with applicable law.)
  • With respect to regulations that have been published in the OFR but have not taken effect, as permitted by applicable law, it directs to temporarily postpone their effective date for 60 days from the date of this memorandum, subject to the exceptions mentioned.
  • The memo also encourages agencies to: Where appropriate and as permitted by applicable law, consider proposing for notice and comment a rule to delay the effective date for regulations beyond that 60-day period.
  • It also states that in cases where the effective date has been delayed in order to review questions of fact, law, or policy, agencies should consider potentially proposing further notice-and-comment rulemaking. Following the delay in effective date:

(a) for those regulations that raise no substantial questions of law or policy, no further action needs to be taken; and

(b) for those regulations that raise substantial questions of law or policy, agencies should notify the OMB Director and take further appropriate action in consultation with the OMB Director.

  • Rules subject to statutory or judicial deadlines are excluded from the directive. The memo asks Executive departments and agencies to identify such exclusions to the OMB Director as soon as possible.
  • The memo also outlines that agencies and Executive departments should notify the OMB Director promptly of any regulations that should be excluded from the directives because those regulations affect critical health, safety, financial, or national security matters, or for some other reason. The OMB Director will review any such notifications and determine whether such exclusion is appropriate under the circumstances.

CUNA is in the process of determining which rules may be impacted. CUNA has also sent a letter to the CFPB stating that with the new administration having taken office, and in light of both the recent ruling in the PHH case as well as the President’s directive for a government-wide freeze on regulations, we expect the Bureau will suspend rulemaking activity that creates new burdens for credit unions and other providers.  The letter notes that a moratorium will give credit unions time to catch up with all of the recently imposed requirements and it will give the Bureau time to figure out how to focus its rules on Wall Street and get out of the way of Main Street.