Rep. Lamar Smith, R-Texas, as well as Rep. Howard Coble, R-
N.C., and Rep. Sam Graves, R-Mo., are proposing H.R. 527, the
Regulatory Flexibility Improvements Act of 2011 that creates
significant economic protections for small businesses when
the U.S. Environmental Protection Agency and other federal
government agencies draft new regulations.
H.R. 527 aims to require the EPA and other federal agencies
to review their rules’ indirect impacts on small entities,
reconsider their existing regulations to minimize their
effects, require more detailed explanations from the EPA in
cases where officials decline to convene special panels to
limit rules’ small business effects and elevate the role of
the Small Business Administration’s (SBA) advocacy office in
litigation over agency rules.
The bill amends current regulatory review
requirements contained in the Regulatory Flexibility Act
(RFA). The House Committee on the Judiciary’s Courts,
Commercial and Administrative Law Subcommittee held a hearing
on the proposal. Coble, subcommittee chairman and bill co-
sponsor, indicated after the hearing that the bill could soon
be considered by the full committee, though he said the
decision was up to Smith, who is committee chairman.
Opponents of the measure state that it will undermine
the EPA and other agencies’ ability to protect public health.
Rep. John Conyers Jr., D-Mich., the ranking member on the
Judiciary Committee, warned at a recent hearing on the bill
that its regulatory review requirements could overburden
agencies and waste money by requiring all agencies to conduct
analyses on the indirect impacts of regulations.
Under the RFA, the EPA and the Occupational
Health and Safety Administration (OSHA) are already required
to certify that their proposed rules will not harm a
substantial number of small businesses or else conduct
small-business review panels to consider regulatory
alternatives that pose less of a burden on small entities.
However, the EPA has faced criticism from small-business
advocates that in some cases, the EPA has avoided conducting
small-business reviews even in cases where some of its rules
may harm a large number of entities.
Now the bill seeks to tighten the agency’s current
regulatory review requirements to consider the impacts of its
rules on small businesses. For example, the bill requires the
EPA and other agencies to consider indirect impacts of
proposed rules, and raises the bar for the EPA to justify
when it chooses not to convene small-business review panels.
Tom Sullivan, former head of SBA’s advocacy office in the
Bush administration and a witness at the judiciary hearing,
says the proposal would also require the EPA to publicize the
“ripple effects” of the proposed rule on small businesses;
for instance, requiring the agency to consider the effects of
a rule governing utilities on the cost of electricity for
small businesses.
To view full text of the proposed bill, visit ASA’s
legislative website at www.TakingTheHill.com.
