Notice & Comment

GAO Rebukes OIRA for Working on Rules During Shutdown

In a letter issued yesterday, the general counsel of the U.S. Government Accountability Office (GAO) opined that the Office of Information and Regulatory Affairs (OIRA) violated the Antideficiency Act (ADA) when it worked on Department of Labor rules during last winter’s government shutdown.

Shutdowns happen when an agency does not have an appropriation from Congress. The ADA makes it illegal to work without an appropriation. As you might recall, that was the longest shutdown we’ve ever had: 35 days. It was also a partial shutdown, meaning that some agencies were funded and others were not. The combination of these two factors created new dynamics for the executive branch in the regulatory domain and beyond.

One interesting wrinkle was that the Office of Management and Budget (OMB), which houses OIRA, was not funded. This ground OIRA’s regulatory review to a halt for most agencies, but not all of them. As the shutdown dragged on, more rules were caught up in it, and OIRA worked on some rules.

To justify its decision to call staff in to work, OMB relied, in part, on a 1995 memo from the Office of Legal Counsel that sketched out a standard: if an agency was funded but the Department of Justice (DOJ) was not funded, DOJ could work on the agency’s activities if failure to do so would “prevent or significantly damage the execution of those funded functions.”

GAO’s general counsel considered the issue as it applied to OIRA’s review of a funded agency’s rule. GAO was unpersuaded that suspending OIRA review of a Labor rule crossed the threshold of “significant harm,” even though the rule was subject to a court-ordered deadline. Instead of having OIRA come in to work, GAO said that Labor could have informed the court of OIRA’s unfunded status and the resulting delay.

Weighing these and other factors, GAO opined that OMB lacked budget authority to work through the shutdown, and that in doing so it violated the ADA. The letter goes on to say that OMB should adjust its accounting and submit an ADA report to Congress that “describe[s] actions taken to prevent recurring violations in similar circumstances in the future.”

The letter concludes with a warning: “we will consider any future obligations of this nature in similar circumstances to be a knowing and willful violation of the Antideficiency Act. The Act provides, in that event, that officials responsible for obligations in violation of the Act shall be ‘fined not more than $5,000, imprisoned for not more than 2 years, or both.’ 31 U.S.C. § 1350.”

It’s unclear how soon OMB will face this situation again. Bills to fund the government through Sept. 30, 2020 are on the President’s desk today. In this blogger’s view, it was the combination of the length of the shutdown and its partial nature that set up this conflict. While we may have more shutdowns in the future, they might not recreate this particular dynamic for OMB.

OMB’s general counsel issued a memo last month shrugging off GAO’s opinions on matters like this. The ADA carries serious penalties, though, so GAO’s letter is likely to leave an impression with the people who turn the cranks of the regulatory process.

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