The staff of the Senate's new regulatory reform subcommittee has drafted a bill incorporating a tough cost-benefit standard for new, major regulatory rules.
The panel, headed by President Reagan's close congressional ally, Sen. Paul Laxalt (R-Nev.), is expected to take up sweeping regulatory reform legislation this spring, and the draft bill, which is being circulated around Capitol Hill and among business and other lobbying groups, is expected to lay the groundwork for subcommittee action.
The bill is far more stringent in terms of its standard of evaluating the potential costs and benefits of new federal regulations than regulatory reform legislation considered last year by two committees in the Senate, which then was controlled by Democrats.
Although it is not clear how the administration will react to the legislation, the draft bill parallels Reagan's recent executive order setting up a cost-benefit test.
A well-placed administration source said yesterday that the draft "needs some more technical work," and that key Justice Department officials still have to review the proposed legislation. The source said it was likely that Laxalt ultimately will introduce a Reagan regulatory reform bill.
Ironically, some experts have suggested that this kind of complex measure might make it more difficult for administration officials to ease existing regulations in light of the stiff procedures that this type of regulatory reform initiative typically outlines.
Under the draft legislation, both Executive Branch agencies and independent agencies such as the Federal Trade Commission and Securities and Exchange Commission could not issue significant new rules unless the rules' benefits are achieved at the "lowest cost" and with the fewest "adverse effects" compared with alternatives.
Further, the legislation would set up a similar review mechanism for old federal regulations. An old regulation would no longer be in effect five years after the legislation is enacted if an agency did not describe the rule's benefits and make the case for its renewal.
The draft bill also incorporates in general terms the so-called Bumpers amendment, named for Sen. Dale Bumpers (D-Ark.), who originated the idea two years ago. Under the plan, federal courts could review, far beyond current standards, the basis for an agency's regulatory action.
In addition, the draft proposes a virtual end to a pet project of consumer organizations: federal funding of individuals or groups seeking to intervene in regulatory proceedings. Agencies would be barred from granting this financial assistance unless a particular statute authorizes it.
The House telecommunications, consumer protection and finance subcommittee, which is headed by Rep. Timothy Wirth (D-Colo.), has launched an inquiry on cable television franchising practices.
"Given the recent enormous increase in cable franchise activity across the country, numerous people, from cable operators to local officials, have suggested that this is a matter that the subcommittee should take a careful look at to determine whether federal action is required or whether there are other ways in which the subcommittee can aid in the development of cable television service for the public," Wirth said yesterday.
The inquiry comes at a time when large cities and suburban communities for the first time have been awarding franchises to cable television companies. Within the last year, franchises have been awarded in communities such as Cincinnati, St. Louis County, Dallas, and Portland, Ore., while decisions are moving forward in Boston and the boroughs of New York City.
Citizen activists, as well as federal officials and others involved in the franchising process, have complained repeatedly about the franchise award process and have suggested a larger federal role in at least helping cities with the complex technological and political issues involved in awarding what is effectively a monopoly not unlike telephone service.
Announcement of the study comes as the panel, restructured and headed by a new chairman, has released a substantial agenda. The commerce subcommittee, which had been the Communications subcommittee, was headed by former representative Lionel Van Deerlin, who was defeated in a reelection bid last November.
But as a result of a committee reorganization, Wirth now has a broader mandate for the subcommittee. Included in the panel's jurisdication are automobile safety and securities laws.
Wirth also said he may take up telephone legislation this year in light of the failure of the Justice Department and American Telephone & Telegraph Co. to reach a settlement in the government's suit to break up the Bell System. "I feel the subcommittee should address the broad range of common-carrier policy issues which until now has been left to the Federal Communications Commission and the courts," Wirth said.
Noting that he does not want to interfere with antitrust laws or their enforcement, Wirth said the committee has not decided "the scope or timetable" for taking up a telecommunications bill. Simultaneously, Senate Commerce Committee staffers are preparing draft legislation revising telephone industry regulation.
Van Deerlin and Wirth were key sponsors of telecommunications legislation during the last Congress. That legislation, after winning support of the full House Commerce Committee, died at the hands of the House Judiciary Committee, whose members were concerned with the bill's effects on the AT&T antitrust case.