One Step Forward, Two Steps Back

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Encouraging progress in public access to industry standards is counterbalanced by a governmental “disappointment.”

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On October 2, the American National Standards Institute (ANSI) held an open forum in Washington, D.C. on “Government Reliance on Voluntary Consensus Standards and Conformance Programs.”  ANSI’s President and CEO, Joe Bhatia, proudly announced that ANSI was creating an Incorporation by Reference Portal – already subscribed to by 14 standards development organizations (SDOs, including the International Standards Organization and other heavy hitters) – to provide free public access on a tightly controlled read-only basis to voluntary consensus standards converted into legal obligations through their incorporation by reference into agency regulations.  James Shannon, President and CEO of the National Fire Protection Association, responsible among other things for the National Electrical Code many states have incorporated by reference into their laws, reminded the audience that NFPA had been providing such a facility for ten years, without appreciable damage to a financial base heavily dependent on sales of its standards.  (The dependency became greater, he remarked, when an industrial member of NFPA lowered its annual dues payment from $25,000 to $42 in retaliation for the adoption of a standard of which it did not approve.  That apparently persuaded NFPA to move away from reliance on industry support for its work to greater reliance on sales revenues, a step unlikely to be taken by industrial SDOs like the American Petroleum Institute or the Pipeline Construction Council, both of which have been relied upon by the Pipeline and Hazardous Materials Safety Administration to develop safety-related standards it has incorporated into its regulations.)  It thus appears that the SDO community is taking helpful steps to bring its work and its business model into the electronic age; if this is (understandably from its perspective) not quite the recognition that “law must be free” that some would hope for, it responds to that impulse.

On the very same day, the Office of the Federal Register (OFR) published a notice of proposed rulemaking concerning its statutory responsibilities for incorporation by reference, in response to a petition I and 23 others had filed eighteen months earlier, and as well to the Administrative Conference study and recommendations that had prompted our petition.  By statute, matters otherwise publishable in the Federal Register may instead be incorporated by reference if the Director of the Office finds them “reasonably available to the class of persons affected thereby.”  These matters may include “statements of general policy or interpretations of general applicability” – soft law as well as the hard law of regulatory obligation.  The existing OFR regulations, unchanged since 1982 and designed for the age of print, nonetheless restricted the possibilities of incorporation to “requirements,” while failing to define what it might mean for incorporated standards to be “reasonably available.” In practice this has meant that one wishing to know an incorporated standard’s content must go to the SDO that developed it and, unless it happened to be available on the Web in read-only format, pay the SDO for a copy.  Nearly 10,000 federal regulatory requirements have been created by the incorporation of voluntary consensus standards; limited agency resources and the costs of new rulemaking have kept aged and displaced voluntary standards in place as legal obligations – over two thirds of this number were adopted more than 15 years ago, and most if not all of these have since been revised as voluntary consensus standards.  Our petition sought changes that would bring the OFR regulations into the electronic age, make standards that had been converted into law freely available to the public, and, by eliminating the “requirement” requirement, both reduce the obstacles agencies face in keeping pace with changes in consensus standards and support a workable contemporary business model for SDOs.

The OFR response is a disappointment in almost every respect.  Its one positive element reflects one of the more important and less controversial aspects of the ACUS recommendations: in order to have a notice of proposed rulemaking that includes incorporation elements published, an agency would be required in its preamble either to summarize the material proposed to be incorporated, or to describe the ways in which it worked to make the materials it proposes to incorporate by reference reasonably available to interested parties.  A similar preamble discussion of the ways in which the agency worked to make the materials it is incorporating by reference reasonably available to interested parties would be required to attend the final rule.  But, mirroring the deficiencies of its 1982 regulations in this respect, not a word in the proposed rule addresses what “reasonably available” – the sole statutory criterion for the Director’s approval or disapproval of incorporation – might be.  The absent definition (and consequent failure of responsibility) is underscored by the definition of a condition that is not statutory – whether the matter incorporated is usable – and by the repeated incantation in the preamble to the proposal that the Director’s resources are limited (as they certainly are).  And the continuing, unaltered content of the usability definition reflects the proposal’s complete indifference to the electronic age – an incorporated standard will be usable only if it is “bound, numbered, and organized.”

Absent, too, is any softening of the “requirement” requirement.  In the rest of the developed world, standards are regarded not as law, but as identified (sufficient but not necessary) means for compliance with regulatory obligations independently stated.  A similar approach is readily imaginable under the language of the governing statute.  If taken, the Code of Federal Regulations could show the regulatory requirement as such, and then append as notes agency indications of contemporary voluntary consensus standards that would assure compliance.  The latter would be much simpler to change as years went by – both removing outdated standards, and indicating new ones.  Today, on the other hand, a 1985 standard adopted by the association of Sheet Metal and Air Conditioning Contractors to govern air duct leakage (important for energy conservation efforts) and then converted into a regulatory obligation by incorporation remains what the law requires, although it has long since been replaced as a consensus standard by SMACNA and indeed is no longer available from it.  Reasonable availability is an issue only at the moment of incorporation; by preserving the unnecessary “requirement” requirement, OFR assures a situation in which such outcomes will occur again and again.

Much more could be said, but perhaps the following will nail home the remarkable deficiencies of OFR’s proposal.  When incorporation by reference was authorized, the expectation was that it would be used for technical matters of little interest to the public – “published data, criteria, standards, specifications, techniques, illustrations, or similar material.”  The 1982 regulations accepted this expectation, providing that only such matters were eligible for incorporation.  Similar expectations have inhered in subsequent federal statutes and policies – the National Technology Transfer and Advancement Act of 1995, and OMB’s Circular A-119 on implementation of that statute.  But in fact OFR has never enforced this limitation, permitting incorporation by reference of standards creating regulatory obligations, plain and simple.  Its proposal now would ratify this neglect, by making it an alternative condition of eligibility that publication “[s]ubstantially reduces the volume of material published in the Federal Register.” It is not only that the electronic age makes this criterion unnecessary; explicitly permitting the incorporation by reference of regulatory obligations would take us a step back into secret law.  To the extent incorporations by reference persist that do importantly take on the characteristics of “law,” that are unmistakably regulatory standards or requirements, it is hard to avoid the conclusion that knowledge of them is the citizen’s right, and that monopoly pricing power over that knowledge cannot properly be conferred by recognizing copyright in them after the fact of their incorporation.

The essay is part of a three-part series on The Continuing Debate Over Regulatory Incorporation.                                                                                       .
Peter L. Strauss
Peter L. Strauss is the Betts Professor of Law at Columbia Law School and is a Senior Fellow of the Administrative Conference of the United States.                                                                                                                                                                                                        .