Statement of ACUS Representative

Jeannie Layson: [0:01] ... at the National Institute of Standards and Technology. Ms. Bremer, please begin by telling us briefly about yourself, how you currently use voluntary consensus standards, and then deliver your statement.
Emily Bremer: [0:11] Thank you. My name is Emily Bremer. I'm currently an Attorney Advisor at the Administrative Conference. We are the independent agency that studies administrative law and process, and makes recommendations to Congress, the President, and agencies for how to improve those issues. We've actually been around since 1968, but we were defunded in '95, and refunded again in 2010. [0:38] We've been up and running for a couple of years now, and Incorporation by Reference was among the first research studies that we picked up when we got back into business. I would add the disclaimer that to a certain extent, the remarks that I'm going to give today are based on my own research, and may not reflect the views of the Conference or its members.

[0:57] The Conference did however, in December of 2011, adopt a recommendation on incorporation by reference. When I'm speaking about the recommendation, that really is the Conference's view, and their consensus position about the appropriate way to address incorporation by reference issues.

[1:12] Last summer, I began the research into this project. I'm going to explain what incorporation by reference is generally, how it connects to several of our policies, including copyright and the national standards policy, although I'll touch these issues only briefly because I know Mary is going to give some really good discussion of that. Then I'm going to talk a little bit about what our recommendation urged agencies to do to address the various issues that are raised by incorporation by reference.

[1:41] The issues that I studied were really threefold. The first was the question of ensuring public access to materials that are incorporated by reference. The second was challenges that agencies face when they have to update their regulations to reflect new voluntary consensus standards, or new versions of the standards they already have incorporated by reference.

[2:01] Lastly, I looked at some procedural and drafting issues that agencies face when they incorporate by reference. The issues that are really most relevant here today are to a certain extent the question of updating, because PHMSA is now in the position where it needs to update the regulations that already incorporate by reference some standards. Secondly, and I think more importantly, the public access question, because of the requirements that Congress has placed on PHMSA.

[2:26] Let's back up a little bit. What is incorporation by reference? Incorporation by reference is a regulatory tool that is permitted under a provision of the Freedom of Information Act. It's in 5 USC Section 552 (a)(1). This provision requires that agency publish, in the Federal Register for codification, in the Code of Federal Regulation, certain types of core materials, including regulations that impose obligations on the public.

[2:54] This provision also provides, however, that material is deemed published in the Federal Register if it's incorporated by reference, provided that the material is reasonably available to the class of persons affected, and the Office of the Federal Register approves the incorporation by reference.

[3:12] As we've already heard, the Office of the Federal Register has recently received a petition for rulemaking, urging OFR to amend its regulations governing the incorporation by reference to do essentially what Congress has done with PHMSA, saying that it shouldn't be considered reasonably available under the statute unless the material is available for free online. That proceeding is still ongoing. They received, I think, 360-plus comments in the docket, and I'll be very interested to see what the result of that proceeding is.

[3:48] The original intention of incorporation by reference was really pretty straightforward. It was to reduce the volume of the Code of Federal Regulations on the material that's published in the Federal Register. I should explain that the Code of Federal Regulations is actually a special edition of the Federal Register that is intended to provide an orderly codification of those agency materials published in the Federal Register that are intended to have general legal force in effect.

[4:15] Now over time, it has come to serve a variety of purposes beyond just reducing the size of the CFR. Namely, and I think most importantly, it's come to be the primary way that agencies fulfill their requirements under federal standards policy. This standards policy has a very long history, and actually began, I believe, with an ACUS recommendation back in 1978. It was Recommendation 78-4, addressing the use of voluntary consensus standards in helping save the regulation.

[4:46] This study that was underlying this recommendation was incredibly thorough. Looked at the role of voluntary consensus standards throughout industry, and urged agencies to use those standards rather than creating their own standards where it was consistent with law and with the agency's regulatory purposes to do so.

[5:04] Shortly after the recommendation was issued, the first edition of OMB Circular A-119 was issued, and that circular was partially codified in 1995 in the National Technology Transfer and Advance Act, commonly referred to as the Tech Transfer Act. The Tech Transfer Act and the OMB Circular require agencies to use voluntary consensus standards where they're available and practicable for agencies to do so.

[5:31] It's effectively a requirement, unless there's a very good reason not to use the voluntary consensus standard. This policy has been incredibly successful. In the 30 years since it's come into place, we have got about 9500 incorporations by reference of standards in the Code of Federal Regulation.

[5:49] Not all of these are privately-created standards. Some are created by government entities. Some are created by non-governmental organizations or international bodies. The use of standards is really ubiquitous throughout our federal government, and it has a lot of advantages.

[6:05] It allows the government to capitalize on technical expertise that exists outside of government. It reduces the costs of not only creating the standards, but enforcing them, because usually industry is already complying with the standards that have been created by these voluntary consensus organizations. It's much easier to adopt standards as law that are consistent with what industry is already doing.

[6:28] Now, the difficulty, of course, from an administrative law perspective is that many, if not most of the standards, particularly those that are created by private standard development organizations, are copyrighted. The standard development organizations sell copies of the standards in order to fund the standard development process.

[6:46] Now, the result of this, if you're an administrative lawyer, is striking. It means that people have to pay in order to comment on a proposed regulation that's going to incorporate a standard by reference. It means that they have to pay in order to see the full text of a regulatory requirement.

[7:03] The question is how do we solve this problem? It wasn't necessarily as much of a problem 30 years ago. But since then, with the advent of the Internet, with pushes to do e-Rulemaking to increase transparency in government, it's become a very stark outlier in comparison to other agency practices where we try to put as much information as possible online for free so that people can find it and read it.

[7:29] Now the difficulty here is that the simplest solutions are not necessarily viable. Through the conferences process, this was the major issue that we dealt with, was how do we improve public access within the confines, not only of the very good standards policy we have without upsetting that and destroying the value of the public-private partnership and standards, but also how do we do it consistent with copyright law?

[7:57] Now, there is, of course, a federal court decision out of the Fifth Circuit that casts some doubt on the continued viability of copyright for incorporated materials. The case is called "Veeck."

[8:10] In that case, it actually dealt with a local government's adoption of a code that was specifically authored for the purpose of being adopted as law. The court said, as adopted as law, it no longer has copyright protection. The model code continued to have copyright protection, but once it was adopted, the version as adopted did not have copyright protection.

[8:31] The court, however, was very careful to distinguish between codes that are adopted by law and that are written to be adopted as law, and standards that are incorporated by reference. The court actually cited OMB Circular A-119, which made it very clear that they were aware of the distinction and intentionally drawing a distinction between codes and voluntary consensus standards.

[8:53] There hasn't been a whole lot of litigation since then. While there is some question about what the continued viability of copyright for standards would be, it hasn't been tested, and it is continued to be copyrighted.

[9:08] The Administrative Conference in 2011, in December, at our plenary adopted a recommendation that addressed some of these issues. It's Recommendation 2011-5, Incorporation by Reference.

[9:20] Now, the very first provision of this recommendation embraces the idea that agencies have an obligation to make sure that standards incorporated by reference, and all other materials, because it's not just standards that are incorporated by reference, but to make sure that these materials are reasonably available. Not only to regulated parties, but also to other interested members of the public.

[9:39] Now, how to do that is the complicated thing. In paragraph two of our recommendation, we say that if the material isn't copyrighted, the agency should just put it on its website. That's pretty straightforward, and it's consistent with what agencies do in other situations.

[9:53] The difficulty is with standards that are copyrighted or other materials that are copyrighted. Paragraphs three and four of our recommendation address this. They urge agencies to work collaboratively with the copyright owners and use available technological tools to improve access without undermining the value of the copyright.

[10:12] It's essentially a non-mandatory, collaborative solution that we have reason to believe has real chance for success. Some agencies have already done this. They approach standard developers, in fact, actually PHMSA has done this, during the course of a rulemaking, for example, and get permission to put a read-only copy of the standard in the docket during the course of the comment period.

[10:37] Other standard developers have increasingly been using technological tools to make their standards more available. For example, the National Fire Protection Association actually puts all of its codes online in a read-only format so that you can actually read the text without paying them for a copy of, say, the electrical code.

[10:55] Now in a very real way, I think PHMSA is at this point operating in a world that is beyond our recommendation, because Congress has imposed upon them a requirement that's very, very stringent. There's not a whole lot of room for compromise or creative solutions because it says that it has to be available online, for free, on an Internet website.

[11:22] There's a certain extent to which I think our recommendation doesn't necessarily provide, unfortunately, with the guidance about how to implement that. I'm really excited that you've done this public workshop today.

[11:33] I think it's a great step forward, and I'm really excited to see all the attention on incorporation by reference generally. I look forward to hearing the ideas of all the panelists here today. Thank you.

Jeannie Layson: [11:44] Thank you.

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