White House Announces New Steps to Cut Red Tape, Eliminate Unnecessary Regulations

Changes Expected to Help Save Businesses and Consumers Nearly $6 Billion

WASHINGTON, DC – Today, as part of the Obama Administration’s unprecedented government-wide regulatory review, the White House announced five final rules that will save nearly $6 billion in the next five years by eliminating outdated requirements and unjustified costs. To ensure that the federal government continues this important work, the President also signed a new Executive Order today, making it a continuing obligation of our government to scrutinize rules on the books to see if they really make sense.

Today’s announcements mark an important milestone in the ambitious regulatory “lookback” that President Obama ordered in 2011 to cut through unnecessary red tape while promoting economic growth and protecting public health, safety, welfare, and our environment.

The President’s Council of Economic Advisers (CEA) also issued a report today on the “lookback” progress to date, noting that agencies have identified over 500 reforms, just a small fraction of which will save more than $10 billion over the next five years.

“Smart rules can save lives and keep us safe, but there are some regulations that don’t make sense and cost too much,” said President Obama. “We will remain vigilant when it comes to eliminating regulations that are not necessary or that impose unnecessary burdens on America’s families and businesses.”

“By streamlining some rules and eliminating others,” said Cass Sunstein, Administrator of the Office of Information and Regulatory Affairs, “we can save billions of dollars in unnecessary costs while continuing to protect the health and safety of the American people.”

Continuing the Administration’s aggressive efforts to deliver a regulatory system that increases benefits to the American people while slashing costs, the new Executive Order signed by the President today directs agencies to promote priority-setting, by emphasizing reforms that produce significant quantifiable savings and by seeking comments from the American people on rules in need of review. To promote accountability, the Order requires agencies to provide the public with regular reports on their past efforts and their future plans -- with details and deadlines. These steps build on, and institutionalize, the President’s Executive Order of January 18, 2011, which first called for the regulatory lookback. These historic reforms were also recommended by the President’s Jobs Council.

Since that time, agencies have made significant progress, as detailed in the CEA report released today. Among the 500 areas identified for reform are five major regulatory reforms that were finalized by agencies today:

• Increasing State and Local Flexibility in Adopting Street Sign and Other Traffic Control Rules. It can be important to update street signs and other traffic control requirements, but national requirements can also impose significant costs.  On the basis of public comments and recent analysis, the Department of Transportation is revising dozens of requirements to increase flexibility for States and local highway agencies and to reduce unnecessary impacts. Specifically, DOT is finalizing a rule that would extend compliance dates on traffic control devices, potentially savings millions of dollars in the process.

• Eliminating Unnecessary Regulatory Costs for the Railroad Industry, Consumers. The Department of Transportation is finalizing a rule to eliminate unnecessary regulation of the railroad industry, saving up to $335 million in the near future. The law requires railroads to install positive train control systems, a technology that can control train movements under emergency circumstances, on tracks that carry passengers and toxic materials.  By updating the current regulation to exempt those tracks that will not have passengers or toxic materials by 2015, DOT is saving up to $775 million over the next 20 years and avoiding the risk that unnecessary costs will be passed on to consumers while continuing to protect public safety.

• Eliminating Red Tape and Saving Doctors, Hospitals $5 Billion. The Department of Health and Human Services is finalizing two rules to remove unnecessary regulatory and reporting requirements now imposed on hospitals and other healthcare providers, saving more than $5 billion over the next five years. One of the rules updates the requirements for hospitals that treat Medicare and Medicaid patients -- the Medicare Conditions of Participation. For example, this rule eliminates outdated hospital management requirements as well as various unnecessary reporting requirements. As a result, total savings are expected to exceed $900 million per year. The second set of reforms addresses regulatory requirements for providers other than hospitals and could save up to $200 million in the first year. Examples of these reforms include updating obsolete e-prescribing technical requirements to meet current standards and eliminating other out-of-date and overly prescriptive requirements for healthcare providers. The combined reforms in both rules are expected to save doctors and hospitals more than $5 billion over the next five years while reducing regulatory burdens so that providers can operate more efficiently for their patients.  

• Getting Rid of Outdated Regulatory Burdens for Gas Stations. The Environmental Protection Agency is eliminating the obligation for many states to require air pollution vapor recovery systems at local gas stations. This measure was imposed in 1990, before new vehicles were required to have built-in air pollution control technologies.  Since the use of technology for modern vehicles is so widespread, EPA is finalizing a rule to eliminate the obligation for many states to require air pollution vapor recovery systems at local gas stations. The anticipated five-year savings are over $300 million.