CEI is in Support of the GOOD Act: Bringing Federal Guidance Out of the Shadows

Dear Members of the Senate Committee on Homeland Security and Governmental Affairs,

We write to you today ahead of markup of the Guidance Out of Darkness (GOOD) Act to express our support for this important legislation. The GOOD Act passed the House of Representatives earlier this year on a bipartisan basis, demonstrating that transparency of federal guidance documents is a unifying principle across party lines. In that sense, the GOOD Act is evocative of the bipartisan Providing Accountability Through Transparency Act of 2023 signed by President Biden, which requires agencies to include a link to a 100-word plain-language summary of each proposed rule.

The GOOD Act would help bring into daylight the thousands of guidance documents and other sub-regulatory actions issued each year by federal agencies. While agencies issue roughly 3,000 new rules annually, they also produce numerous interpretive rules, policy statements, memoranda, FAQs, circulars, and other guidance documents—what we sometimes collectively refer to as “regulatory dark matter.” These actions are frequently suspected of being employed to achieve policy objectives outside the notice-and-comment process required under the Administrative Procedure Act.

We need better ways to tabulate the “rule equivalencies” of such dark matter, since notice-and-comment regulation does not capture the full sweep of federal intervention anymore. The GOOD Act specifically can aid in that pursuit; and indeed, is the prerequisite for anything else Congress might do. By requiring agencies to post their guidance documents online in an accessible and centralized manner, the GOOD Act gives the public, Congress, and regulated parties a clearer picture of the actual scope of federal activity.

The dark matter problem has worsened in recent years. Cognizant of the problem and hoping to fix it, President Trump issued Executive Order 13891 in October 2019 requiring executive agencies to create searchable, indexed databases of all their guidance documents. That reform was repealed by the Biden administration, removing one of the few structural restraints on the unchecked growth of guidance. The GOOD Act would restore and codify these transparency requirements, making them durable and less subject to administrative whim that should be objectionable to both parties.

Greater visibility of guidance is also a prerequisite for accountability. Without reliable public access, agencies can leverage grants, loans, contracts, public-private partnerships as well as informally “jawbone” to induce compliance with objectives policies that were never scrubbed through the rulemaking process. The GOOD Act takes the necessary first step toward restoring congressional oversight and public participation over this hidden layer of regulation.

This legislation is also timely. Federal spending programs of recent vintage from the Infrastructure Investment and Jobs Act, the Inflation Reduction Act, and the CHIPS and Science Act will inevitably produce large new flows of guidance, contract clauses, policy statements and potential influence through so-called Notices of Funding Opportunity. Without transparency, these measures risk imposing unfunded or underreported mandates not just on businesses but also on states, localities, and small businesses—all of which should be of concern to both parties. The GOOD Act will help give Congress and the public the tools to see and measure these interventions as they emerge. 

We commend the Committee for taking up this bipartisan, commonsense reform—one it has supported on a bipartisan basis in prior Congresses—and urge you to do so again. Passing the GOOD Act now will help ensure that future administrations—regardless of party—cannot govern through opaque and unaccountable “pen-and-phone” directives. We urge you to advance this legislation to the full Senate and to help permanently institutionalize transparency over regulatory dark matter.

Sincerely,

Clyde Wayne Crews Jr.
Fred L. Smith Fellow in Regulatory Studies
Competitive Enterprise Institute

Matthew Adams
Senior Government Affairs and Coalitions Manager
Competitive Enterprise Institute