Sponsors (8)
The bill narrows how consent decrees and settlement terms can shape agency action to save taxpayer money and increase clarity about guidance versus regulation, but it also makes settlements harder, may deter legal challenges, and centralizes discretion in OIRA, trading quicker enforcement and some litigation incentives for greater judicial and executive control.
Taxpayers: settlements that produce regulations or agency guidance will be less likely to include payment of private attorneys' fees and litigation costs, reducing government payouts.
State governments and regulated entities: clearer definitions of what counts as 'guidance' versus a 'regulation' increase transparency and predictability in how agencies act and enforce rules.
Federal agencies (and federal employees): courts are less likely to bind agencies to consent-decree terms that exceed judicial authority, preserving separation of powers and preventing agencies from accepting unlawful obligations.
Taxpayers and federal agencies/employees: restricting what terms can appear in consent decrees could make litigation harder to resolve by settlement, increasing legal costs and prolonging disputes.
Federal agencies, regulated parties, and the public: giving OIRA authority to exempt categories of rules centralizes discretionary power in the Executive Office, risking politicization of what counts as a 'regulation' and reducing independent agency flexibility.
States, NGOs, and individual plaintiffs: banning recovery of attorneys' fees in settlements that lead to guidance or regulations may deter meritorious suits by removing cost recovery, reducing incentives and access to legal challenge or enforcement.
Based on analysis of 2 sections of legislative text.
Stops agencies from using consent decrees or settlements to create regulations/guidance beyond courts' authority and bans fee payments tied to such settlements.
Official title: To provide limitations for Federal agencies entering into settlement agreements and consent decrees, and for other purposes.
Introduced January 31, 2025 by Michael Cloud · Last progress January 31, 2025
Prohibits federal agencies from using consent decrees or settlement agreements to impose regulatory requirements or binding guidance beyond what courts can order, and bars inclusion of attorneys’ fees or litigation cost payments in settlements that produce regulations or guidance. Defines "guidance document" and "regulation," lists exclusions (e.g., certain military/foreign-affairs and internal personnel rules), and includes a severability clause.