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Floor Statement: Regulatory Flexibility Improvements Act of 2011 (HR 527)

Washington, December 1, 2011 -

Chairman Sam Graves (R-MO)
House Committee on Small Business
Floor Statement on H.R. 527, The Regulatory Flexibility Improvements Act of 2011
December 1, 2011


CLICK HERE to watch the video


(Remarks as Prepared)

I rise today in support of H.R. 527, the Regulatory Flexibility Improvements Act of 2011.  I was an original cosponsor and want to thank Chairman Smith for the opportunity to work with him on this important piece of legislation.

Opponents will argue that the bill stops agencies from issuing regulations.  However, the reality is that H.R. 527 will force agencies to consider how their actions affect small businesses and other small entities.  More importantly, if the effects are significant, agencies, not small entities, will have to develop less burdensome and costly alternatives.

In my district, the Missouri River can overflow its banks.  Before the Army Corps of Engineers can build a flood control project, the agency has to study the consequences of building a flood control project.  Understanding the consequences of a flood control project before it is built certainly makes sense. 

If the government needs to understand the effects of a flood control project should not that same government also understand the consequences of its regulations?  Of course it should.  By doing so, the government may arrive at a more efficient and less costly way to regulate.  In a nutshell that is what H.R. 527 does. 

Some may argue that agencies already do this when they draft regulations.  However, nearly 30 years of experience with the Regulatory Flexibility Act or RFA shows that agencies are not considering the consequences of their actions.  And it is about time that they do so. 

Government regulations do have consequences.  Small businesses must expend scarce and vital capital complying with these rules.  If there is a better way to achieve what an agency wants while imposing lower costs on these small businesses, the sensible approach would be to adopt the lower cost methodology.  This will enable small businesses to meet the requirements imposed by regulators while freeing up scarce resources to expand their businesses and hire more workers. 

H.R. 527 ensures the careful consideration of consequences of rulemaking through the removal of loopholes that agencies have used to avoid compliance with the RFA.  In addition, the bill will require a closer consideration of the impact of rules on small businesses and other small entities.  Yet, nothing in H.R. 527 will prevent an agency from issuing a rule – just issuing a rule without understanding its effect on America’s best job creators – small businesses.

I urge my colleagues to support this carefully crafted measure to improve the federal regulatory process. 

I reserve the balance of my time.