Forbes:Little-Used Congressional Review Act Becoming An Indispensable Tool

As the United States Senate finally begins taking up joint resolutions designed to reverse a handful of regulations implemented during the waning days of the Obama Administration, it's worth discussing the indispensable role the Congressional Review Act (CRA) has come to play in halting regulatory excess, and more importantly, upholding the rule of law.  While the merits of some of the regulatory actions targeted for reversal are certainly arguable, others lie so far outside the governing statutes that their reversal, either by congress or the courts, was almost inevitable from the day of their initial proposal.

Last week, House Majority Whip Steve Scalise (R-LA) introduced a resolution that would reverse a regulation sought by the Office of Natural Resources Revenue (ONRR) that would revise the federal regulations governing the valuation of the government's royalties for oil and natural gas produced from federal lands and waters.  Steve Daines (R-MT) followed suit with the introduction of a similar resolution for the Senate to consider.

The premise of the ONRR valuation regulation is pretty straight-forward:  it would essentially, with only minor differences, allow the federal government to collect its oil and gas royalties on the same bases for valuation that govern the collection of oil and gas royalties for Indian lessors.  Now, the average person who doesn't have any knowledge of any of the details involved might look at this proposal and think, gee, that seems fair, which of course is exactly the public reaction proponents of this regulatory effort hoped to engender.  But things are not always what they seem, and what is in fact "fair" in this situation depends on the details in the governing statues and, more importantly, the governing lease agreements.

During 1998 and 1999, I personally represented the U.S. Oil and Gas Association on a negotiated rule-making committee charged by then-Secretary of the Interior Bruce Babbitt.  I was one of five industry representatives on a committee of 22 people, the other 17 of whom represented various Indian tribes and organizations, and the Minerals Management Service (MMS), which was the precursor agency to the ONRR.  That negotiated rule-making process ultimately produced what became the current set of regulations that govern the valuation of royalties related to natural gas produced from Indian lands.

That regulation became effective in the year 2000.  A few years later, another, separate process ultimately resulted in the current regulations that govern the valuation of Indian oil royalties.

By:  David Blackmon
Source: Forbes