Committee OKs Regulatory Reform BillMarch 16, 2016
On March 2, the House Oversight and Government Reform Committee approved the Midnight Rule Relief Act of 2016 (H.R. 4612) which was introduced by Rep. Tim Walberg (R-Mich.). The committee approved the legislation by a partisan vote of 20-17. During the markup, Ranking Member Elijah Cummings (D-Md.) and Del. Eleanor Holmes Norton (D-D.C.) both offered amendments to the legislation however neither was ultimately adopted. Companion legislation was introduced in the Senate by Sen. Joni Ernst (R-Iowa), after which it was referred to the Senate Committee on Homeland Security and Governmental Affairs.
The legislation attempts to limit regulations promulgated just before a sitting president leaves office. Under the legislation, agencies would not be allowed to propose or finalize regulations between the day after presidential elections and January 20th of the following year unless the rule does not have an annual effect on the economy of $100,000,000 or more, a major increase in price for consumers, or a significant economic impact on a substantial number of small entities. Under the framework established by this legislation, there would be some exceptions. Those exceptions include deadlines established before the moratorium period, emergency health and safety issues, and if the rule promulgated is to remove regulations.
The legislation has dim prospects for eventual passage as it would cut off the president’s ability to regulate for the final two months of his presidency. Even if approved by both the House and the Senate, it is unlikely that President Barack Obama will sign such a measure when there are several components of his regulatory agenda which will likely come down to his last few months in office.
NSBA supports legislation which will stem the flow of regulations coming out of federal agencies as small businesses struggle to keep up. Small businesses on average spend more per employee on regulatory compliance than larger businesses which are also better suited to absorb the additional compliance costs. Steps should be taken to encourage consistent and responsible regulation. Increasing predictability in the regulatory process is crucial for small businesses to grow, and limiting the potential for several major regulations to be implemented at once will provide that predictability.