Administrative procedure enthusiasts will have read with great interest the memorandum on deregulatory review policy released by the White House Office of Management and Budget (OMB) on Tuesday October 21. The memo builds on several Executive Orders and memoranda released by the Trump Administration earlier this term focused on “ending federal bureaucratic overreach” which directed agencies to “aggressively and quickly withdraw regulations” and specifically called for a 10-to-1 ratio of repeals to new regulations.[1]

This week’s memo has policy goals that are aligned with these previously established approaches but it treads potentially significant new ground in establishing “deregulation” as a category of action with different analysis, timelines, and procedural requirements compared to “regulations.” This appears to be a somewhat novel approach, and one without a clear foundation in administrative law.

The Administrative Procedures Act (APA) defines “rule making” as the “agency process for formulating, amending, or repealing a rule.” In 2015, in the case of Perez v. Mortgage Bankers Association, the Supreme Court found that based on this definition, APA “mandate[s] that agencies use the same procedures when they amend or repeal a rule as they used to issue the rule in the first instance.”

A significant portion of the memo is devoted to the repeal of regulations that conflict with current interpretations of law, e.g. per the memo, where “unlawfulness is apparent to the agency after reviewing the text of the relevant regulation.” This type of repeal is a subset of “deregulatory actions” that the memo addresses. The second half of the memo defines a ‘deregulatory action’ as “an action that has been finalized and has total costs ” Of course, it’s not the case that all regulations have net costs and therefore that the repeal would have costs less than zero. Indeed, agencies are generally supposed to refrain from taking regulatory action “unless the potential benefits to society for the regulation outweigh the potential costs to society.”[2] This memo is intended to guide agency implementation of the President’s “deregulatory agenda,” but agencies clearly may need to consult with Office of Information and Regulatory Affairs (OIRA) staff to determine whether a specific rulemaking will be considered a deregulation or not. In fact the memo explicitly “encourages agencies to work with OMB, the public, and the interagency community to identify, preview, and develop deregulatory actions.”

The question of what qualifies as a deregulatory action will be important because the memo creates new procedures for such rulemakings. Specifically, it directs that “agencies should consider deregulatory actions as presumptively not triggering… consultation [with tribes or with state and local governments] or substantive analytic requirements.” Further agencies should expect the same presumption “will likely apply to all other ancillary requirements for regulatory analysis.” Moreover, the memo imposes a presumptive maximum 28-day OIRA review period for deregulatory actions that are executed with factual records, and 14-days for facially unlawful rules, compared to the 90-day status quo for regulatory actions.

The memo also addresses cost-benefit analyses at length. Cost-benefit analysis was first widely implemented as part of the rulemaking process by the Nixon Administration, and the current basic framework for regulatory cost-benefit analysis was created by the Reagan Administration. By tying the definition of deregulation to the cost of the rule, this memo on the one hand underscores the significance of cost-benefit analysis. Yet in several places the memo writers appear to be of split opinions on the value and appropriate methodology of cost benefit analyses. The memo reminds agencies that OIRA allows for the consideration of qualitative impacts rather than solely quantitative analysis, “if there are important decision-making advantages to doing so”. But in the next paragraph, agencies are warned they “should not eschew quantification when quantification is possible” which “would not be consistent… with the emphasis the Supreme Court has placed on cost quantification.”

The memo then lays out categories of potentially unquantifiable “pro-deregulatory considerations” that agencies might use to build the record for their deregulatory actions. The benefits that agencies may assume exist for the purposes of their cost benefit analyses are: first, that deregulation has a benefit of increasing the scope of private freedom, and second: that the collective value of, and synergies between, a group of deregulatory actions may be greater than the sum of its parts.

If these benefits are still inadequate to make the definition true that a deregulation has a cost less than zero, the memo offers two additional justifications that an agency may use in building their record. First, an agency may look at the past predictions of costs and benefits made when the regulation was issued and determine whether those have not been borne out by experience, and use that evidence to “make a powerful case for deregulation”. Second, the agency can rely on the fact that “courts have generally been more deferential to agency enforcement decisions made under resource constraints” and therefore can frame deregulation as a “codification, in effect, of voluntary enforcement priorities.”

Finally, the memo addresses notice-and-comment requirements—a critical component of the APA procedures for agency rulemakings that enshrines Congressional intent to ensure public engagement through the submission of public comments (including from the regulated entities). Although notice and comment is a core element of rulemaking, APA also provides an exemption from this requirement when an “agency for good cause finds … that notice and public procedure thereon are impracticable, unnecessary, or contrary to the public interest.”[3]

The memo reiterates prior instructions from the President to repeal rules the agencies find to be facially unlawful without notice and comment under the “good cause” exemption. (If it’s possible for OMB’s bureaucratic prose to express emotion, the memo seethes with annoyance when it notes that “to date, agencies do not appear to be fully maximizing their energy in carrying out these directives.”)

For USDOT, opinions may vary on whether agencies have been maximally energetic in finding that good cause exists to waive notice and comment periods and allowing rules to take effect immediately.  In the first nine months of the Administration, the agencies have issued 197 interim final rules in which, for good cause, they waived comment periods. This is a higher number than any of the first nine months of the last three administrations. Looking at numbers outside of FAA, which issues an order of magnitude higher number of regulations than the other modes, the non-FAA modes have issued 68 interim final rules this term compared to 14 in the first nine months of the Biden Administration and 23 in the first nine months of President Trump’s prior term.

On the other hand, the total number of proposed regulations for which comments have been requested in these last nine months from non-FAA modes at USDOT also far exceeds the numbers from the corresponding terms in the last two presidential terms. As a result even though the number of interim final rules has increased, the percent of rules that are released as interim final rules waiving notice and comment compared to proposed rules has actually decreased to 37% of the total relative to 41% in the Biden Administration and 45% in the first Trump Administration.

[1] Presidential Memoranda “Directing the Repeal of Unlawful Regulations” April 9, 2025 https://www.whitehouse.gov/presidential-actions/2025/04/directing-the-repeal-of-unlawful-regulations/

[2] Executive Order 12291, “Federal Regulation,” 46 Federal Register 13193, February 19, 1981

[3] 5 U.S.C. § 553(b)(B)