The REG Budgeting Act creates a new "regulatory budget" system that caps the amount of new costs federal agencies can impose on businesses and individuals through rulemaking each fiscal year. Starting in fiscal year 2026, the Director of the Office of Management and Budget must establish a total spending limit for all agencies combined and individual limits for each agency, which Congress must approve if the limits allow any net increase in regulatory costs. Any new regulation that would exceed an agency's limit cannot take effect unless Congress approves it by joint resolution, though exceptions exist for emergencies, criminal law enforcement, and national security. The bill also requires agencies to submit detailed justifications before finalizing costly rules, mandates public reporting of all regulatory costs and decisions, and creates a new Associate Administrator for Regulatory Budgeting within OMB to oversee the system. The Federal Reserve's monetary policy decisions are exempt from these requirements.