Easing the Regulatory Burden - View from the Hill
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SECTION: View from the Hill

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Easing the Regulatory Burden

By Rep. Brad Ellsworth (D-IN)

Article Date: 02-01-2008
Copyright(C) 2008 Associated Equipment Distributors. All Rights Reserved.

With AED's input and support, a new bill helps protect entrepreneurship.

Since 1980, the Regulatory Flexibility Act (RFA) has helped ensure that America's small businesses are not unfairly disadvantaged by federal regulations. However, the RFA has been on the books for 28 years and it is clear that certain parts of the law are not working as well as they should be. That is why I am working to improve the law and strengthen regulatory protections for small businesses. AED is playing an important part in that effort.

Small businesses are critical to our economy and to the development of communities nationwide, creating up to 80 percent of all new jobs and making up over half of our gross domestic product (GDP). The fact that small businesses pay an estimated 45 percent more in regulatory costs than larger firms only serves to hinder small-firm innovation and expansion. The time has come to reign in the rapidly increasing regulatory costs facing America's small businesses and entrepreneurs.

As a member of the House Small Business Committee, I am working to address the "loopholes" in the RFA that have reduced its ability to alleviate the regulatory burden on our nation's small businesses. In the past months, input from members of the small business community, policymakers, and the Small Business Administration's Office of Advocacy has helped to shape ideas on what steps were necessary to ensure that the RFA serves its purpose in the present day. Witnesses before the committee, including AED Vice President of Government Affairs Christian Klein, expressed concerns that agencies were not living up to their obligations to review the burdens of proposed and existing rules on small businesses.

In response to the concerns of small businesses about the burden of federal regulations, on Dec. 12 I introduced the Small Business Regulatory Improvement Act (H.R. 4458). H.R. 4458 specifically addresses the shortcomings of the RFA and seeks to ensure that entrepreneurs are no longer overlooked in the regulatory process.

Changes proposed in H.R. 4458 include:

  • A broader definition of the term "economic impact" for purposes of the RFA
  • A mandate to ensure agencies conduct a more detailed analysis of proposed rules as well as periodic review of existing rules
  • A provision to force agencies to directly respond to comments submitted by the Small Business Administration's Office of Advocacy, an agency that consistently defends small businesses.
On Dec. 14, H.R. 4458 was passed by the House Small Business Committee by a vote of 26-0. This is an important first step in establishing a regulatory process that is balanced and fair to entrepreneurs.

With the number of challenges currently facing small businesses, it is critical that they are not overburdened by federal regulations. By passing this legislation, we are bringing significant relief to the nation's 26 million small firms while at the same time stimulating our economy.

While critics of the RFA have characterized it as a barrier to the regulatory process, this is incorrect. The law improves transparency and the rulemaking process by ensuring the needs of small businesses are considered by agencies.

It is simply unacceptable to ignore how these regulations may hamper entrepreneurship and innovation. These improvements help small ventures flourish by creating a fair process that they are better able to manage.

I thank AED for its continued support of my efforts in this area and look forward to working with the equipment industry to make sure that Congress is responsive to the needs of this important sector of the American economy.


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Article Categories:  Public Policy