1.3 Scope of This Document

This guidance document discusses the contents and preparation of a full EA. As indicated above, the EA can be viewed as an expanded EIA--one that includes a benefits assessment and benefit-cost comparison. Therefore, while the document is designed to cover all aspects of an EA, by definition it also addresses the EIA, which is a subset of the larger analysis. Proposal and final assessments overlap significantly and, therefore, have a common structure that will be presented here. However, there are important differences in the purpose of the proposal and final assessments and the stage in the rule development process at which each is prepared. These differences and the implications for their preparation will be emphasized throughout this document.

This document also presents further background information on the CAA, EO 12866, and other statutes and EOs imposing analytical requirements. Recommended analytical methods and other practical issues that arise in conducting these analyses are also discussed. This information provides a broader understanding of the role of economic analysis in the regulatory process and ways the analysis can better inform that process.

Several issues relevant to economic analysis in ISEG are beyond the scope of this document. The following topics do not receive detailed treatment in this document, but they are important for the analyst to consider in performing these assessments:

• theoretical foundations of welfare economics and benefit-cost analysis,
• analysis of information collection requirements, and
• document style and formatting.

This guidance document is a companion to several other guidance documents available to ISEG staff, including

• Economic Analysis of Federal Regulations Under Executive Order 12866 , Office of Management and Budget, January 11 1996;
• EPA Interim Guidance for Implementing the Small Business Regulatory Enforcement Fairness Act and Related Provisions of the Regulatory Flexibility Act, EPA SBREFA Task Force, February 5, 1997;
• Interim Guidance for Incorporating Environmental Justice Concerns in EPA’s NEPA Compliance Analyses, EPA Office of Federal Activities, September 30, 1997;
• Unfunded Mandates Guidance, EPA Office of Regulatory Management and Evaluation, August 11, 1995;
• Engineering Inputs for the Economic Impact Analysis.  Office of Air Quality, Planning, and Standards, Innovative Strategies and Economics Group.  July 1997; and
• Guidelines for Preparing Economic Analyses.  EPA, Office of Policy.  Draft under revision in fall 1998.

Because the issues addressed in these documents tend to evolve, analysts should ensure that they have the most recent guidance on these issues. Although this document does overlap to some extent with the other guidance documents, its primary purpose is to address analytical and procedural issues specific to preparing economic assessments in OAQPS. Readers should refer to the other guidance documents for more detailed information on the specific statute or EO and its analytical requirements.