President Donald Trump (R) issued a pair of executive orders on October 9 that aim to limit the use of guidance documents by federal administrative agencies and end what the order refers to as administrative abuses by requiring agencies to provide fair notice of regulations.
Agency guidance documents are not legally binding, but rather seek to provide the public with clarification about how agencies interpret and administer regulations. The Administrative Conference of the United States (ACUS) concluded in a 1992 report, however, that agency officials sometimes use guidance documents in ways that give them the same authority as legally binding rules.
The first of the two executive orders requires that agencies “treat guidance documents as non-binding both in law and in practice … take public input into account when appropriate in formulating guidance documents, and make guidance documents readily available to the public.” The order clarifies that agencies can only issue binding regulations through the rulemaking process or case-by-case adjudication. The order also instructs agencies to make a searchable index of all guidance documents publicly available on their websites.
The second executive order aims to curb what the order refers to as administrative abuses by prohibiting agencies from enforcing rules without first providing advance notice to the public. The order also calls on agencies to provide members of the public with opinion letters when they reach out to agencies for information about how to comply with regulations.
Russ Vought, acting administrator of the Office of Management and Budget (OMB), supported the executive orders in a statement, arguing that the “executive orders give this administration the tools to defend Americans’ freedom and liberty against off-the-book regulations and prevent unfair penalties from being levied on American families and businesses by rogue agencies.”
Lisa Zarlenga, a former tax legislative counsel at the Treasury Department, expressed concern about the executive orders in an interview with _Bloomberg Law_, noting that individuals frequently rely on agency guidance when completing tax forms. She added, however, that taxpayers have occasionally claimed that the Internal Revenue Service (IRS) issued what she called stealth regulation through informal guidance documents.