When the Environmental Protection Agency weighs whether environmental and health risks should lead to air quality rule changes, it soon will have to follow more stringent procedures being proposed by the Office of Management and Budget.

The Jan. 9 risk assessment bulletin outlines for the first time how regulatory agencies — such as EPA, the Transportation Department and Food and Drug Administration — analyze the likelihood and severity of risks to the public before they issue rules and policies.

Agency regulators already perform risk assessments when deciding whether to issue a regulation affecting a product or industry, but they don’t currently follow any set guidelines. Supporters of risk management argue that it helps government decision makers issue and enforce the most cost-effective and important regulations, while detractors say the practice is an underhanded attempt to protect corporate interests and block regulations.

Both sides agree that OMB’s risk assessment bulletin is one of the most important regulatory reforms pushed by the Bush administration.

“This is the most significant thing to come out since the [2001] Data Quality Act,” said Jim Tozzi, president of the Center for Regulatory Effectiveness, a Washington group that works to lessen the regulatory burden on the private sector.

Robert Shull, a regulatory analyst with OMBWatch, a Washington organization that advocates for increased regulation on corporations, agreed. “This is really significant, really serious,” he said. “It has a broad, reaching effect.”

Graham: Risk guru

When John Graham was nominated in 2001 as the administrator of OMB’s Office of Information and Regulatory Affairs (OIRA), opponents feared he would increase the amount of risk analysis and risk management in federal decision making. In fact, Graham ran the Harvard Center for Risk Analysis before taking the OMB job. However, the bulletin on risk assessment comes five years after he took office — after he reformed guidelines for peer review, data quality and cost-benefit analysis of regulations.

“I would have thought this was precisely the kind of thing [Graham] would have done immediately,” said Shull. He compared the late delivery of the bulletin to midnight regulations, the term applied to the presidential tendency to issue numerous regulations right before they leave office.

The risk assessment bulletin is part of an ongoing effort to improve the transparency, objectivity and integrity of information disseminated by federal employees to the public, said Susan Dudley, a former OIRA employee who heads the Arlington Va.,-based Mercatus Center’s Regulatory Studies Program, which studies the regulatory process.

Ideally, risk assessments are objective scientific investigations to estimate how much risk different activities pose and then inform policy decisions about what should be done, she said. Risk assessment should not be influenced by values or policy judgment, she said, but in practice they have been more of an art than a science.

“This guidance document should go a long way toward making government risk assessments more science than art. It guides agencies to rely on objective information, using the best data available, and to be transparent in their use of data and assumptions that make up an analysis,” she said.

Changes to assessments

Risk assessments are used by federal managers to set priorities and alert the public about problems, even if no regulations have been written. For instance, the government may want to tell citizens how much risk is associated with living in a house with high levels of radon gas or with a sport-utility vehicle with a high height-to-width ratio. All health, environmental and safety threats are subject to risk analysis as part of the normal regulatory process.

Agency managers use government scientists or government contractors to perform most risk assessments.

Under the proposed bulletin, all risk assessments will have to comply with six new standards. Every risk assessment will have to describe the data and methods used with a high degree of transparency and will have to place the risk in perspective by telling the public how it compares with other risks they understand.

The standards will govern the scope of risk assessments, how agencies are permitted to characterize risk and how scientists will ensure accurate and unbiased information.

So-called influential risk assessments will have additional barriers to overcome. Such assessments are those evaluations that will have a significant impact on public policy and private-sector decisions, such as determining the danger of faulty tire pressure in vehicles. Such a risk assessment would be used to determine whether to institute a costly rule requiring auto manufacturers to include tire-pressure monitoring systems. Influential risk assessments will be required to be reproducible, meaning that nongovernmental scientists using the same data and research methods would come up with similar results.

The bulletin calls for uniform standards for risk assessments across all federal agencies. According to the bulletin, uniformity is needed because an assessment prepared by one agency may inform the policy decisions of another agency or inform decisions made by legislators or the judiciary.

Good guidance on how to perform risk assessments should be consistent across government, said Angela Logomasini, director of Risk and Environmental Policy at the Competitive Enterprise Institute, a government watchdog group in Washington. But uniformity across agencies serves another goal of Graham’s, she said. Graham has long discussed the possibility of comparing the effectiveness and utility of regulations across government in order to stop regulations that are not cost-effective or to pick the most cost-effective regulatory action.

“One of the reasons why Graham is emphasizing uniformity,” Logomasini said, “is to look across agencies and say, ‘Why are we putting all our resources on low risks?’”

But uniformity is unnecessary for agencies with widely different missions, said Shull. He said some of the standards were harmless while others, such as the one that dictates how agency regulators are permitted to characterize the danger of a threat, could keep regulators from writing regulations based on the worst-case scenario. For instance, some regulations governing chemical spills are written to prevent a worst-case scenario, but the OMB guidance requires agencies to write risk assessments in terms of the probable threat.

Regulatory experts agree that the bulletin will mean more work for agency scientists.

“Good science always requires more effort,” said Logomasini, “But for those people in government who want to do a good job, this will help them focus on science and insulate them from political situations.”

Interested parties have until June 15 to submit comments on the proposed guidance, found at www.whitehouse.gov/omb/inforeg/ infopoltech.html#iq.