Nearly a quarter of the regulations proposed by agencies and departments across the government were changed at the behest of the Office of Management and Budget before they are issued, according to statistics released by the office.
As a result, seven years into the Reagan administration, OMB influence over government regulation appears to be increasing. In 1981, 87.3 percent of all regulations sailed through the OMB review process without change. Last year, the figure was down to 68.3 percent.
OMB officials said that a third of the changes are insignificant, a few are last-minute alterations offered by the departments and agencies, and others are statistical aberrations.
President Reagan asked OMB to review regulations for cost-effectiveness and necessity within weeks of his inauguration and OMB's Office of Information and Regulatory Affairs has been controversial ever since.
The House voted to shut down the regulatory office last year. But after Reagan threatened to veto a $566 billion omnibus funding bill for fiscal 1987 over the $5 million issue, Congress backed down.
Some lawmakers remain dissatisfied. They argue that OMB's economists, statisticians and lawyers have acquired near-veto power over the scientists, engineers, and technical experts who write regulations in the agencies. They said that public health and safety is eroded when rules are watered down and standards are eased to save money or meet theoretical economic considerations.
Others disagree. "OMB is wrongfully attacked as a bunch of malevolent industry toadies, the Darth Vaders of the administration," said a senior fellow at a progressive think tank in Washington. "There is nothing wrong with second-guessing the regulatory agencies and occasionally questioning their science. Regulations cost the public a lot of money and somebody has to ask, 'Is it worth it?' "
Wendy Lee Gramm, head of the regulatory office, said that "in the early days, we routinely cleared a lot of rules that we don't even review anymore," such as state plans for implementing federal Environmental Protection Agency regulations. This practice of exempting a number of rules that were once routinely cleared has meant that the percentage of rules fine-tuned by OMB has appeared to grow, she said.
"Perhaps we are reviewing more carefully as we have become more experienced," she said.
Of all the changes OMB suggests, Gramm pointed out, "Roughly one-third are just grammar and clarification."
Gramm said that she believed a trend line of the past two years would be essentially flat. Last year, 68.3 percent of agency rules passed muster without change. The year before the figure was 70.7 percent.
Robert P. Bedell, Gramm's former deputy, said that the reviewing process is beginning sooner now than during the early years of the Reagan administration and that alone assures that a number of changes will be made in any rule before it is released.
"Agencies now send rules over here for review and continue to work on them," he said. "They send it over at the beginning of red border review" -- the final review by the top agency officials. "The first time Environmental Protection Agency Administrator Lee Thomas sees it, we've had it for several days."
Any changes made after OMB gets it -- including changes made by the agency -- are tallied, Bedell said.
The administration said it has cut back on the rate of new regulations substantially. The number of pages in the Federal Register, the official vehicle for new rules, has been reduced from 87,012 in 1980 before Reagan took office to 47,418 last year. The number of proposed rules has been cut by 2,000, and the number of final rules by 3,000, according to OMB statistics.
The EPA produces more "significant regulatory activities" than anyone else, according to OMB's recently released "Regulatory Program" publication. Other top rule-producing departments are Agriculture, Health and Human Services, Transportation, Interior, Commerce and Education, in that order.