Small Biz Regulatory Reform Bill Introduced in the House

February 4, 2015

pic-paperwork-tax-smLast week, House Small Business Committee Chairman Steve Chabot (R-Ohio) introduced the Small Business Regulatory Flexibility Improvements Act (H.R. 527). The bill would update and improve the Regulatory Flexibility Act of 1980 (RFA), which requires federal agencies to assess the economic impact of regulations on small business before imposing overly burdensome mandates, in order to prevent federal agencies from further exploiting “loopholes” to get around the statute’s intentions.

Annually, the American public spends about $2 trillion complying with federal regulations and roughly eight billion hours complying with regulations and paperwork demands. Small businesses disproportionally bear a larger portion of the federal regulatory burden, facing an annual regulatory cost of $10,585 per employee per year, which is 36 percent higher than the regulatory cost facing large firms.

H.R. 527 seeks to close loopholes harming small firms by requiring agencies to conduct more extensive analysis of proposed rules, providing greater opportunity for small business input, and ensuring agencies regularly review regulations already enacted for their economic impact on the small business community. In addition, it would require each department to convene a small-business review panel to discuss any major new regulations before the rules can be implemented. The bill would also expand the scope of the required economic impact analysis to consider indirect effects, which would minimize any significant adverse impact.

NSBA supports this legislation as it would help reduce red-tape by providing much needed reform, transparency and priority setting in the regulatory process for the nation’s job creators, small businesses.

The House has passed this legislation in the previous two sessions of Congress, but both times it was rejected by the Democrat-controlled Senate at the time. Now, the measure is scheduled for a vote by the full House on Thursday, Feb. 5 and NSBA urges strong congressional support for passage of this bill; reining in excessive regulations will provide a boost to, and certainty for entrepreneurs as they work to compete, expand and create jobs.

To read NSBA’s letter of support click here.