H.R. 580 — Unfunded Mandates Accountability and Transparency Act of 2025

This section amends the Unfunded Mandates Reform Act of 1995 (UMRA) as follows: (1) capitalizes "tribal" as "Tribal" each place it appears; (2) adds to section 3 (2 U.S.C. 1502) a definition of "major rule" as a federal rule (per 5 U.S.C. 551) that the Administrator of the Office of Information and Regulatory Affairs determines is likely to cause an annual economic effect of $100 million or more (adjusted every five years for increases in the Consumer Price Index for All Urban Consumers), a major increase in costs or prices for consumers, industries, governments, or regions, or significant adverse effects on competition, employment, investment, productivity, innovation, public health and safety, or U.S. enterprises' competitiveness; and (3) revises section 202 (2 U.S.C. 1532) to retitle it "Regulatory impact analyses for certain rules," define "cost" to include compliance costs and reasonably foreseeable indirect costs (e.g., lost revenues) of major rules, require agencies to prepare and publish initial regulatory impact analyses with proposed major rules (open to public comment) and final analyses with final major rules, specify contents of such analyses (including quantified benefits and costs to the extent feasible, analysis of regulatory alternatives such as market-based incentives, compliance with section 205 of UMRA, assessments of federal funding availability and disproportionate effects on regions or sectors, job impacts, and prior consultations with state, local, and Tribal governments), and update cross-references to the new structure. (As background, UMRA generally requires agencies to analyze rules imposing $100 million (inflation-adjusted) or greater mandates on state, local, Tribal governments, or the private sector; these changes expand and strengthen section 202 requirements to cover major rules with more detailed regulatory impact analyses.)

This section revises state, local, tribal, and private sector input requirements under sec. 204 of the Unfunded Mandates Reform Act of 1995 (UMRA) by (1) amending the section heading to insert "and private sector" before "input"; (2) expanding subsection (a) to require agencies to develop processes permitting elected officers of state, local, and tribal governments (or designees), plus impacted private sector parties (including small businesses), to provide input on regulatory proposals containing significant federal mandates (from federal intergovernmental mandates only); and (3) replacing subsection (c) with mandatory agency guidelines requiring early and ongoing consultations before and through the final rulemaking stage, with a wide variety of stakeholders; estimation of benefits and costs scaled to mandate significance; solicitation of views on costs, benefits, risks, compliance alternatives, and harmonization with other laws; consideration of cumulative regulatory impacts; and allowance for electronic comments (not as the sole consultation method). (As background, UMRA generally requires federal agencies to assess unfunded mandates on state, local, and tribal governments exceeding specified thresholds and consult on significant intergovernmental mandates; these changes broaden the scope to private sector stakeholders and all significant federal mandates while prescribing detailed consultation procedures.)

This section revises section 205 of the Unfunded Mandates Reform Act of 1995 (UMRA) to require agencies, before promulgating any proposed or final major rule for which a regulatory impact analysis is required under UMRA section 202, to select the alternative that maximizes net benefits from those considered under section 202(c)(1)(B), taking into account only costs and benefits within the scope of the authorizing statute (previously, to select the least costly, most cost-effective, or least burdensome alternative for rules with federal intergovernmental or private sector mandates requiring a written statement under UMRA section 1532). Agencies may adopt a different alternative only with approval from the Administrator of the Office of Information and Regulatory Affairs and if the alternative accounts for unquantifiable costs or benefits (e.g., related to constitutional or civil rights, which the agency must identify and explain) or achieves additional benefits or cost reductions (which the agency must identify and justify as outweighing any additional costs or foregone benefits). (As background, UMRA Title II generally requires federal agencies to prepare a regulatory impact analysis for major rules that may impose annual costs of $100 million (adjusted for inflation) or more on state, local, and tribal governments or the private sector.)

This section revises Section 208 of the Unfunded Mandates Reform Act of 1995 (UMRA) to establish responsibilities for the Administrator of the Office of Information and Regulatory Affairs (OIRA)—replacing prior requirements for the Director of the Office of Management and Budget (OMB)—with respect to agency major rules requiring a regulatory impact analysis (RIA) under UMRA section 202 (i.e., rules containing federal mandates with annual effects on state, local, or private sectors of $100 million or more, adjusted for inflation). Specifically, it (1) directs OIRA to provide guidance and oversight ensuring such rules are consistent with UMRA Title II principles and requirements, other applicable laws, and do not conflict with other agencies' policies or actions; (2) requires OIRA, if noncompliance or conflicts are identified, to notify the agency, specify areas of concern, and request compliance before finalizing the rule; and (3) requires OIRA to submit an annual report to Congress—including the Senate Committee on Homeland Security and Governmental Affairs and the House Committee on Oversight and Government Reform—detailing agency compliance with relevant UMRA requirements for such rules (including OIRA-requested improvement activities) and containing an appendix on section 204 compliance (i.e., preparation of written statements for rules with significant private-sector mandates), replacing the prior OMB annual report on overall subchapter compliance.

This section establishes a new section 209 of the Unfunded Mandates Reform Act of 1995 requiring agencies, upon determining to initiate a rulemaking that may result in a major rule (i.e., a rule that may result in annual expenditures of $100 million or more—adjusted for inflation—by State, local, and tribal governments or the private sector), to (1) establish an electronic docket for the rulemaking (which may have a physical counterpart); and (2) publish a notice of initiation in the Federal Register not later than 90 days before the notice of proposed rulemaking. The notice must (A) briefly describe the major rule's subject, objectives, and problem to be solved; (B) refer to the legal authority, including the specific statutory provision; (C) invite interested persons to propose alternatives and other ideas; (D) indicate how to submit written material for the docket; and (E) appear within the specified timeframe. (Thus, the provision increases early transparency and public input opportunities for major rules beyond existing notice-and-comment procedures.)

This section (1) revises the definition of "agency" under the Unfunded Mandates Reform Act of 1995 (UMRA) to include independent regulatory agencies (previously excluded), thereby subjecting their rules to UMRA requirements for identifying and estimating costs of federal mandates on state, local, and tribal governments and the private sector; and (2) exempts rules concerning monetary policy proposed or implemented by the Board of Governors of the Federal Reserve System or the Federal Open Market Committee from UMRA titles II (congressional consideration of unfunded mandates), III (regulatory accountability and review), and IV (judicial review).

This section replaces the judicial review provision (2 U.S.C. 1571) of the Unfunded Mandates Reform Act of 1995 (UMRA). Under the new provision, any aggrieved person may seek judicial review—governed by Administrative Procedure Act standards (5 U.S.C. ch. 7)—of an agency's compliance with UMRA §§202(b) (contents of written regulatory impact analysis), 202(c)(1), or 205 (least burdensome regulatory alternative) in adopting a major rule subject to §202 (i.e., rules imposing federal mandates with annualized costs exceeding an inflation-adjusted threshold, currently $200 million). Courts with jurisdiction to review rules under APA §553 or other law have jurisdiction over such claims and may order remedial action consistent with the APA. (As background, current law limits review solely to compelling preparation of certain UMRA statements and plans and bars noncompliance from affecting a rule's validity.)

This section expands the congressional point of order under the Unfunded Mandates Reform Act (UMRA)—previously applicable only to federal intergovernmental mandates (i.e., those imposed on state, local, and tribal governments)—to all federal mandates, including private sector mandates. It revises the point of order in 2 U.S.C. 658d(a)(2) to apply to any bill, joint resolution, amendment, motion, or conference report increasing direct costs of such mandates above thresholds in both 658c(a)(1) (intergovernmental) and (b)(1) (private sector), unless the measure provides equivalent new budget authority, entitlement authority, direct spending authority, or authorization for appropriations.