In a weak economy, small businesses are trying to keep their heads above water. The current regulatory flood coming from federal agencies threatens to drown our nation’s best job creators. These new rules and mandates drive up costs and paperwork, and are often unnecessarily cumbersome. All federal agencies should give better consideration to the real world impact of their rule making on the small firms that have to live with all the red tape and minimize that burden.

Regulations have piled up at a record pace in recent years. A staggering 3,800 new rules were handed down in Fiscal Year 2012. Last year also has the dubious notoriety of being the costliest year yet for major regulations, driven by 14 major rules that imposed costs of between $14.8 and $19.5 billion, according to the Office of Management and Budget.

This week, the Committee passed legislation ensuring that small firms have an opportunity from the start to shape more sensible regulations that hold down small business costs and make compliance easier. The Committee’s work is highlighted in news reports from The Hill and Bloomberg. It’s time to insist that federal agencies exercise due diligence to understand how their endless enthusiasm for regulations really affects small businesses and find more workable solutions.

Sincerely,

Sam Graves
Chairman

Latest Committee Action

On Wednesday, the Committee favorably reported the bipartisan Regulatory Flexibility Improvements Act of 2013 (HR 2542), which strengthens the small business protections in the rule making process. Under current law, federal agencies are supposed to assess the economic impact of their regulations on small businesses, and if the impact is significant, consider alternatives that are less burdensome. However, federal agencies use loopholes to bypass the law’s purpose. The Regulatory Flexibility Improvements Act of 2013 would ensure careful consideration of the consequences of rule making on small businesses, including indirect impacts, and require agencies to convene small business review panels to help them understand the burden. That allows opportunities for better input from small businesses on regulations in advance of imposing new requirements. The bill is supported by more than 125 associations and groups that represent small firms which signed a September 16, 2013 letter endorsing H.R. 2542, and more letters of support have followed. 

On Thursday, the Small Business Subcommittee on Economic Growth, Tax and Capital Access, under the chairmanship of Rep. Tom Rice (R-SC), held a hearing to highlight private sector efforts to educate small business owners and entrepreneurs. The hearing featured private organizations that provide entrepreneurial education and counseling to address barriers for those who want to start and succeed at small business ventures. During the hearing, Goldman Sachs made news, as reported in the New York Times and Businessweek, by announcing that its 10,000 Small Businesses program would be expanding from its current 15 markets to the entire nation, enabling small business owners from across the country to participate in the education component of the program. Also testifying were My Own Business, Inc. of California; Servosity of Greenville, SC; and the Corporation for Enterprise Development of Washington, DC. 

News from Washington

On Thursday, the nation reached a milestone marker of five years of inexcusable delays by President Obama in the construction of the much-needed Keystone XL pipeline, which will bring North American energy from Canada to the refineries in the southwestern Unites States. Construction would create jobs, help lower prices and strengthen U.S. efforts to be more energy independent. The USA Today reports that gas prices have set an unhappy record in the anemic economic recovery: 1,000 days of gas prices above $3 a gallon. 

Also on Thursday, by a vote of 246-178, the House passed the National Strategic and Critical Minerals Production Act of 2013, H.R. 761, which streamlines the permitting process to responsible development of America’s abundant natural resources to create jobs and provide key products to the economy for medical professionals, our military and manufacturers.

Also on Thursday, the House passed the Nutrition Reform and Work Opportunity Act of 2013 (H.R. 3102) by a vote of 217-210. The bill ensures that Americans in need of food assistance have the help they need, saves $39 billion over ten years by cutting waste and abuse, and establishes clearer eligibility rules to prevent fraud. The U.S. Department of Agriculture, which administers the food stamp program, estimates 47.7 million American households received government food assistance in June. The rate of households in the program soared over five years from 8.6 percent of U.S. households, when the nation was in a recession, to 13.6 percent of households in 2012, according to the USA Today’s report that the food stamp rise belies the economic recovery. The cost of the program to taxpayers has more than doubled in five years to $78 billion last year.

On Friday, the House passed a continuing resolution by a vote of 230-189 to fund the federal government through Dec. 15, 2013 at the current level, excluding the President’s health care law, which is burdening small businesses and causing them to hold off on hiring or cut back employees’ hours. The resolution (H.J.Res. 59) provides funding for the start of the new fiscal year 2014, beginning October 1^st, and directs the Treasury Department’s payment priorities.

Also on Friday, the House passed the Restoring Healthy Forests for Healthy Communities Act (H.R. 1526), by a vote of 244-173. The bill directs the Forest Service to update its management of federal forest lands to restore limited sections to use, known as forest revenue reserves, to strengthen local economies and help support rural schools and communities. The measure will reduce wildfire risks, improve forests’ health and create jobs, while saving $269 million through 2023, according to the nonpartisan Congressional Budget Office.

Put More Muscle into the Regulatory Flexibility Act

By Sam Graves

• Fortune: We're Still 8.3 Million Jobs from Full Recovery

• AP: Census: No Sign of Economic Rebound for Many in US

• AP: Employment Gap Between Rich, Poor Widest on Record

• The Hill: Industry Groups Rally for Regulation Reform Bill

• EHS Today: Congressman Graves Encourages Small Businesses to Comment on Proposed Silica Rule

• CNN Money: No Thanks, Obamacare. I'll Pay the Penalty

• Bloomberg: Obamacare Doctor Rationing Begins in California

• Wall Street Journal: Household Incomes Level Off

• Washington Post: Stubborn Facts and Bothersome Polls

• Wall Street Journal: U.S. Overstates Leaks by Gas-Drillers, Says Study

• Wall Street Journal: Target: Natural Gas

• Fox Business: Small-Business Lending 5 Years After Lehman

• Businessweek: Collateral Damage for Small Business Credit

Small Biz Resources