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House Democrats Want Answers About Reg Task Forces

POSTED ON Aug. 8, 2017

A group of House Democrats is demanding greater transparency surrounding the regulatory reform task forces created in accordance with one of President Trump's executive orders.

“Some agencies have reportedly refused to release basic information about these deregulatory Task Forces, such as the names of the people appointed to serve on them,” they said in an August 7 letter to Office of Management and Budget Director Mick Mulvaney and Office of Information and Regulatory Affairs Administrator Neomi Rao.

Executive Order 13777 required federal agencies, including Treasury, to create regulatory reform task forces charged with identifying regulations that “eliminate jobs, or inhibit job creation”; “are outdated, unnecessary, or ineffective”; “impose costs that exceed benefits”; or “create serious inconsistency or otherwise interfere with regulatory reform initiatives and policies.” The task forces were also required to issue reports to their agency heads within 90 days of the date of the order.

Tax Analysts has repeatedly sought additional information about Treasury’s task force, including filing a Freedom of Information Act request for a copy of the report, but Treasury officials have not provided any substantive answers.

A Treasury spokesperson confirmed June 21 that the task force’s report was submitted but said it won’t be made public. Shelley Leonard, attorney-adviser, Treasury Office of Tax Legislative Counsel, said in May that acting Treasury General Counsel Brian Callanan had been appointed the department’s regulatory reform officer, who serves as one member of the task force. According to the order, the task force should also comprise the agency’s regulatory policy officer designated under section 6(a)(2) of Executive Order 12866, a representative of the agency’s central policy office, and three additional senior agency officials.

Given the lack of a public report from the task force, it was unclear what, if any, IRS regulations were being examined under Executive Order 13777. However, on August 4 the IRS issued Notice 2017-42, 2017-34 IRB 1, announcing it will delay the effective date of rules in the section 871(m) dividend equivalent regulations. That notice specifically cited Executive Order 13777, stating that in accordance with the order Treasury and the IRS would “continue to evaluate the section 871(m) regulations and consider possible agency actions that may reduce unnecessary burdens imposed by the regulations.” Notably, the section 871(m) regulations were not included in the list of eight significant regulations (Notice 2017-38, 2017-30 IRB 147) Treasury is considering modifying under Executive Order 13789.

The August 7 letter — which was sent by Reps. Elijah E. Cummings, D-Md., John Conyers Jr., D-Mich., Gerald E. Connolly, D-Va., and David Cicilline, D-R.I. — cites a joint investigation by The New York Times and ProPublica that found that the task forces include political appointees with potential conflicts of interest and have met without public scrutiny. It also said withholding the names of the task force members might violate FOIA, noting the Department of Justice’s FOIA guide states that “civilian federal employees who are not involved in law enforcement or sensitive occupations generally have no expectation of privacy regarding their names, titles, grades, salaries, and duty stations as employees.”

The letter demands Mulvaney and Rao provide information on the task forces by August 25, including the names of the task force members and all documents and communications related to participation in task force meetings by nongovernmental entities. It also asks them to disclose what measures agencies are taking to provide transparency for the regulatory review process under Executive Order 13777, and it asks them to explain why some agencies have refused to disclose the names of task force members in response to FOIA requests.