The Business Council of Alabama has signed a letter from the National Association of Manufacturers addressed to members of the U.S. House of Representatives in support of legislation that protects small businesses from burdensome federal regulations.
The Regulatory Flexibility Improvements Act of 2013 (H.R. 2542) is sponsored by U.S. Spencer Bachus, R-Vestavia Hills.
BCA President and CEO William J. Canary said the legislation will strengthen the Regulatory Flexibility Act passed more than 30 years ago that has enabled small businesses to save billions of dollars by reducing regulatory costs. “With this legislation businesses can continue to save money by avoiding burdensome regulatory costs that can detract from the bottom line and imperil the creation of new jobs and endanger existing ones,” Canary said.
H.R. 254 would require agencies to consider a proposed rule’s indirect effect on small businesses and to conduct small business panels before major rules are proposed. H.R. 2542 would expand the authority of the Small Business Administration’s watchdog role over agency rulemaking.
“This will help ensure agencies thoroughly consider small business impacts in their analysis and will eliminate loopholes that currently allow agencies to avoid this analysis,” NAM said.
The Business Council of Alabama, the state’s foremost voice for business, is Alabama’s exclusive affiliate to the National Association of Manufacturers and the U.S. Chamber of Commerce. The BCA is a non-partisan, statewide business association representing the interests and concerns of nearly 1 million working Alabamians through its member companies and its partnership with the Chamber of Commerce Association of Alabama.
Here is the text of the letter:
We are writing to express our support for H.R. 2542, the Regulatory Flexibility Improvements Act of 2013. This bipartisan legislation would reform the regulatory process to ensure that all federal agencies appropriately consider the impact of their rules on small businesses across America. In November 2011, the Regulatory Flexibility Improvements Act passed the House of Representatives with meaningful bipartisan support.
Small businesses are the backbone of the nation’s economy, and their ability to operate efficiently and free of unnecessary regulatory burdens is critical for our country’s economic recovery. According to the U.S. Census Bureau, these companies employ over half of all private sector employees and are responsible for 64 percent of net new jobs over the last 15 years, yet they are disproportionately impacted by compliance burdens associated with regulation. The Regulatory Flexibility Improvements Act directly addresses that small business challenge.
H.R. 2542 would improve and modernize the Regulatory Flexibility Act (RFA), a three decades-old law that requires federal agencies to transparently account for the impact of regulation on small businesses. However, each agency interprets important terms in the statute in widely divergent ways and is often able to avoid many of the RFA’s requirements. This bill would streamline and make uniform those determinations of when the RFA would apply to a rule.
When properly followed, the RFA works. In fiscal year 2012, the U.S. Small Business Administration’s Office of Advocacy reported first year compliance savings of $2.4 billion for small businesses. In fiscal year 2011, the first year compliance savings were $11.7 billion. These savings were derived from just a few agencies considering alternatives to their proposed rules that were less costly to small businesses. If all federal agencies did the type of analysis required by this legislation, the savings could be significantly higher.
Many rules that have significant impacts on small entities are not covered by the RFA because the small businesses adversely impacted are not the directly regulated entity. This commonsense legislation gives the Office of Advocacy additional authorities and requires the office to establish standards for conducting a “regulatory flexibility analysis” during the rulemaking process. It improves transparency and ensures that agencies thoughtfully consider the impact of regulations on small businesses.
In addition, H.R. 2542 buttresses President Obama’s 2011 Executive Order on regulatory review by strengthening the RFA’s “look back” requirements when rules impact small business. The President’s order also requires agencies to seek advanced stakeholder input before proposing rules. H.R. 2542 would expand early stakeholder input through the use of the small business panel process for all rules covered by the RFA.
The industries represented on this letter cover virtually every sector of the small business community. H.R. 2542 would help alleviate regulatory burdens placed on small businesses while allowing agencies to meet their obligations for public health, safety and the environment. We urge your support for this commonsense bipartisan legislation.