Senate Spars Over Regulatory Reform : Congress: Debate opens on how to overhaul government’s power to draft health, safety rules. Dole, Glenn offer competing bills.

Senate Democrats and Republicans returned Monday from a week’s holiday to spar over a plan to overhaul the federal government’s powers to draft regulations.

The showdown, which is expected to play out this week, pits a proposal put forward by Senate Majority Leader Bob Dole (R-Kan.), a presidential contender whose campaign stands to gain financial support from the business community as a result of the plan, against a milder alternative drawn up by Sen. John Glenn (D-Ohio).

Ultimately, the debate may lead to a faceoff between Dole and President Clinton, who has suggested that he might veto any regulatory reform bill that waters down regulations to the extent that it compromises the environment and public health and safety.

At stake is the federal government’s latitude to issue rules and regulations on everything from the operation of jumbo jets and the inspection of meats and vegetables, to the sale of back-yard barbecues. For the businesses affected, the changes could cut the cost of adhering to the government’s rules--a requirement estimated to cost as much as $850 billion annually--by slowing the flow of new regulations.

Dole, who has identified regulatory reform as one of his top legislative priorities, argued Monday that the costs of excessive federal regulation “lie like a blanket” over the nation’s economy and drive small businesses into bankruptcy. Government excess has created “a regulatory state that is out of control with overly burdensome rules and standards,” he complained.

Senate Minority Leader Tom Daschle (D-S.D.), who had called the regulatory reform debate one of the most important legislative battles of the year, on Monday called Dole’s version of the bill “an extreme measure,” and promised that Democrats would try to change the bill’s “most onerous” provisions.

The outcome is far from certain. Glenn’s proposal has the support of most Democrats and at least three Republicans. The Dole legislation, with the backing of most of the chamber’s 57 Republicans and three Democrats, does not appear to have the 60 votes it would need to break a filibuster.

Seeking to avoid a filibuster, staffers from both sides tried unsuccessfully during last week’s recess to fashion a compromise. On Monday afternoon, however, consensus appeared to elude lawmakers. The Senate did pass, however, an amendment extending the cost-benefit analysis requirement to any proposed rule that “has significant economic impact on a substantial number of small businesses.”

Whichever bill survives the legislative fight, federal agencies will find it much tougher to issue new standards for businesses and individuals.

Under both proposals, federal agencies would be forced to conduct detailed analyses weighing the costs of new regulations against their benefits to public health, safety and the environment, and to justify proposed rules in those terms.

The Republican regulatory reform package would require the federal government to make those analyses in many more cases than would the Democratic bill. It would require a “cost-benefit” assessment for any proposed regulation expected to cost more than $50 million to execute, while the Democratic alternative would set that threshold at $100 million.

The Dole proposal also would allow business to go to court to demand that a federal agency review a proposed regulation. In many critics’ views, that would result in a cascade of lawsuits as businesses probed the limits of the government’s latitude and created “regulatory gridlock” that would hamstring the federal government’s ability to protect Americans and make lawyers rich.

“Regulatory reform should not be a lawyer’s dream, opening up a multitude of new avenues for judicial review” of proposed government actions, Glenn said recently in proposing his alternative. “We’ll find agencies being swamped” with study requirements that would add to their personnel needs, even as new rules trickle out at a slower and slower pace, he said.

Indeed, the White House Office of Management and Budget estimates that carrying out all the provisions of the Republican package would cost the federal government $1.3 billion more per year, including the addition of 4,500 full-time employees.

Glenn argued Monday that Dole’s bill “would flunk its own cost-benefit test” by forcing the completion of 400 to 600 cost-benefit analyses per year, many on regulations that would be widely supported by the public.

If an agency failed to complete the required studies on time, it would lose its chance to propose a rule.

House Republicans, who completed a sweeping regulatory reform package in March, considered the legislation so important that it was a part of their “contract with America” legislative agenda outlined as a campaign promise before the 1994 midterm election.

In a move that many lawmakers said they saw as political, Dole introduced his proposal on the Senate floor before adjourning the chamber last week and spending the week campaigning in New Hampshire.