6.1 The Unfunded Mandates Reform Act (UMRA)
UMRA requires that Federal agencies assess the effects of Federal regulations on State, local,
and tribal governments and the private sector. In particular, UMRA requires that agencies prepare a
written statement to accompany any rulemaking that "includes any Federal mandate that may result in
the expenditure by State, local, and tribal governments, in the aggregate, or by the private sector, of
$100,000,000 or more (annually adjusted for inflation) in any one year" (Section 202(a)). The term
"Federal mandate" means a Federal intergovernmental mandate or a Federal private-sector
mandate. These terms are precisely defined in the statute as follows:
Federal intergovernmental mandate means (A) any provision in legislation, statute, or regulation that (i) would impose an enforceable duty upon State, local, or tribal governments, except (I) a condition of Federal assistance; or (II) a duty arising from participation in a voluntary Federal program... (B) any provision in legislation, statute, or regulation that relates to a then-existing Federal program under which $500,000,000 or more is provided annually to State, local, and tribal governments under entitlement authority, if the provision (i)(I) would increase the stringency of conditions of assistance to State, local, or tribal governments under the program; or (II) would place caps upon, or otherwise decrease, the Federal Government's responsibility to provide funding to State, local, or tribal governments under the program; and (ii) the State, local, or tribal governments that participate in the Federal program lack authority under that program to amend their financial or programmatic responsibilities to continue providing required services that are affected by the legislation, statute, or regulation.
Federal private sector mandate means any provision in legislation, statute, or regulation that (A) would impose an enforceable duty upon the private sector except (i) a condition of Federal assistance; or (ii) a duty arising from participation in a voluntary Federal program; or (B) would reduce or eliminate the amount of authorization of appropriations for Federal financial assistance that will be provided to the private sector for the purposes of ensuring compliance with such duty (Section 421).
The written statement must
If a written statement is prepared for a proposed rule, then the final rule must also include a written statement, updated to reflect any changes in analysis or intergovernmental consultation that has occurred since the proposal stage. The written statement should be prepared as a joint effort between the ISEG analyst and the workgroup.
The statute provides specific directions regarding the contents of the benefit-cost analysis to be included in the written statement. In particular, UMRA requires that the analysis
While the information developed to meet the EA requirements of EO 12866 will generally satisfy the analytical requirements outlined above, three basic requirements unique to UMRA need to be met independently of any EA conducted under another authority:
For further guidance on conducting expenditure assessments and impact analyses under UMRA, analysts are referred to the Agencys Unfunded Mandates Guidance ( EPA, 1995b).