Susan Dudley, administrator of the Office of Information and Regulatory Affairs, and Sharon Hays, associate director of the Office of Science and Technology Policy, issued the guidelines in the form of a Sept. 19 memo titled, "Updated Principles for Risk Analysis."
The memo updates a 1995 memo on risk analysis. The 1995 memo divided broad principles for risk analysis into five parts: General Principles, Principles for Risk Assessment, Principles for Risk Management, Principles for Risk Communication, and Principles for Priority Setting Using Risk Analysis. Clinton-era OIRA administrator Sally Katzen issued the 1995 memo.
The new memo keeps these five categories as well as each individual principle. The new memo includes additional text with each original principle. In some cases, the explanatory text is brief. In other cases, it includes detailed discussions of certain aspects of risk analysis such as the treatment of scientific uncertainty or analyzing effects on sensitive subpopulations.
In the memo, Dudley and Hays announced they issued the document in lieu of the controversial Proposed Risk Assessment Bulletin. The Bulletin contained a set of guidelines to govern all risk assessments and included technical standards for all federal agencies to use when conducting risk assessments, as well as other scientific documents.
However, the standards in the Bulletin were too prescriptive and represented an unrealistic one-size-fits-all approach toward all federal risk assessments. Public interest groups and lawmakers criticized the Bulletin when OMB proposed it.
OMB requested that the National Research Council, part of the National Academies, review the bulletin. The NRC review found the Bulletin to be "fundamentally flawed." NRC suggested the Bulletin be withdrawn completely. Following the release of the report, OMB announced it would go back to the drawing board to "develop improved guidance for risk assessment."
The memo marks the official withdrawal of the Bulletin. "OMB Watch applauds the decision to withdraw the Risk Assessment Bulletin," the organization said in a statement.
The risk analysis memo is an improvement over the proposed bulletin. It imposes no new requirements on agencies, nor does it give OMB additional reviewing powers. The memo is also broader. While the Bulletin focused on risk assessment, the memo more expressly covers other aspects of risk analysis including management, communication and prioritization.
However, the memo does raise significant concerns. The memo fits into a pattern of changes to the regulatory process enacted by OMB during the Bush administration. Although the memo updates the 1995 risk analysis principles, it places these principles in the context of those broad regulatory changes.
The memo reaffirms the new requirements for agency "guidance documents" set out by the Good Guidance Practices Bulletin and amendments to Executive Order 12866, Regulatory Planning and Review. The changes subject agency guidance documents to an OMB review period, although neither the Bulletin nor the revised E.O. define guidance documents clearly. The memo indicates OMB considers risk assessments to be a form of guidance. Sweeping risk assessments into OMB's review of guidance raises concern because risk assessments are not just documents but processes of scientific or technical evaluation.
The memo also places risk analysis in the context of economic assessments. The memo encourages agencies to refer to OMB's Circular A-4 — a document describing the process by which agencies prepare cost-benefit analyses for regulatory activities — when evaluating or choosing risk management strategies. This is the latest example of OMB attempts to make economics the preeminent criteria in rulemaking.
OMB also uses the memo to promote its 2002 Information Quality guidelines. For example, the memo states, "The agency also should identify the sources of the underlying information … and the supporting data and models, so that the public can evaluate whether there may be some reason to question objectivity." While OMB Watch supports transparency and objectivity, this statement may be an attempt to promote Data Quality Act challenges. The guidelines allow these challenges, which are public requests for agencies to reevaluate technical or scientific data or reassess conclusions. Industry representatives often use the challenges to delay agency regulatory activity.
"The practical effect of this new memo is probably not very significant," said Rick Melberth, Director of Regulatory Policy at OMB Watch. "Agencies will probably stick this in a desk drawer because this doesn't change much in the way that agencies conduct their regulatory analyses." Nonetheless, OMB Watch remains concerned about how the memorandum may be used to fit into a broader pattern of "less regulation is better regulation" promoted by the Bush administration.