Combatting “Regulatory Dark Matter” in DOGE’s Government Cleanup Efforts

DOGE has enjoyed enormous success right out of the gate. It has already achieved significant savings by cancelling unnecessary contracts, shelving government programs that provide minimal value, and rooting out fraud.

President Trump recently issued an executive order signaling that excess regulation will also be in DOGE’s crosshairs. This is a very wise move. By some accounts, regulations cost the American economy $4 trillion per year. Trimming the fat could produce savings as large as or larger than those achieved in the contracting and personnel space.

As state regulatory overseers, we applaud what the Trump Administration and DOGE are doing. We have undertaken similar reforms in our states and have slashed tens of thousands of regulatory requirements. As a result, Virginia has saved $1.2 billion per year and was recently named the top state for business. Indiana’s reforms have just gotten started, but they promise to further cement Indiana’s reputation as one of the most business-friendly states in America. We are excited to have a like-minded partner at the federal level and look forward to seeing what gets accomplished in the next four years.

In the spirit of federal-state partnership, we would like to offer some insight based on what we’ve experienced in the last few years. Slashing unnecessary regulations is important and worthwhile. But oftentimes regulatory burdens aren’t in the regulations at all. They’re in a sort of regulatory dark matter known as “guidance documents.”

Guidance documents are technically non-binding. They are supposed to flesh out the requirements contained in statute or regulations. And when they actually do that, they can be quite useful, providing businesses and other regulated parties additional insight on how they can comply with the law.

But federal agencies have abused the guidance process in recent years. They often issue very vague regulations and then rely on guidance to provide all the meaningful details. This allows them to get around the rulemaking process under the Administrative Procedure Act, which can take years to complete.

Since they’re so easy to issue, guidance documents could number in the millions, though no one knows the precise number. Through our own review of one federal agency—the Centers for Medicare & Medicaid Services—we identified 6,195 pages of guidance documents posted since 1994 in various forms, including informational bulletins, state health official letters, and frequently asked question documents. This exceeded the number of pages of regulations issued by the same agency during this period.

In his first term, President Trump asked agencies to list all their guidance documents online and prohibited agencies from imposing requirements in guidance. This ensured that the public was at least aware of relevant guidance. But President Biden killed this initiative shortly after taking office, and many agencies took down the guidance they had previously posted online.

Now that President Trump is back in office, he has reinstated his directive that agencies post all guidance online and remove binding provisions from guidance. But he could also go further.

He could create a comprehensive website containing all guidance documents across the government. The Code of Federal Regulations codifies relevant regulations across agencies, and there should be an equivalent resource for guidance. The Virginia Regulatory Town Hall website, which lists every single guidance document in the state, is a good model.

President Trump could also extend his 10-for-1 initiative to guidance: for every page (or word) of new guidance issued, agencies should eliminate 10 pages (or words) of existing guidance.

Virginia did something similar, extending a 25% regulatory requirement reduction goal to guidance document length. Virginia agencies have taken the initiative to heart and have already slashed 44% of the words in guidance documents, blowing past the original goal. Agencies are on track to cut nearly 50% of the words by the end of the Youngkin Administration. And agency officials have praised the effort, explaining that it has saved them a lot of effort by eliminating the need to maintain documents that were often long, confusingly worded, and out-of-date.

Indiana took a different approach and provided new avenues for regulated parties to challenge agency decisions based on guidance documents through the use of mandatory attorney’s fees. Forcing the agencies to pay for the cost of litigation when they rely on non-binding guidance empowers regulated parties to police the actions of the agencies and help rein in abuses.  As a result, agencies have been aggressively reviewing their programs to either remove requirements contained only in guidance documents or put them into law or regulation.  

A third state, Idaho, has also focused on reducing guidance documents and improving transparency. Through legislative and executive action, the state made clear that agency policy statements and guidance documents do not have the force and effect of law. This must be made clear on documents posted on agency websites. This year, the state legislature advanced a bill to limit the types of decisions that can be made in policy and guidance documents outside the legislative review process. Further, the state’s largest agency eliminated 2,265 pages of policy and guidance documents.

For too long, federal regulators have acted with minimal oversight. And they have figured out ways to get around the limited burdens they operate under, using things like guidance documents to circumvent the traditional regulatory process.

By closing the guidance loophole, President Trump and DOGE can ensure that their regulatory reforms provide relief for businesses and citizens who have labored under a confusing morass of regulations and various “sub-regulatory” instruments for decades. And DOGE can apply the same lightning quick approach to guidance documents that it has to other reforms, since guidance can be issued or rescinded without going through the highly involved process associated with federal rulemaking.

We’ve seen great success leading that effort in our states, and we’re heartened to see DOGE take up the mantle at the federal level.