Regulatory Watch


Background

Government regulations and red tape can be a tremendous barrier to small business growth. Small businesses' regulatory compliance costs are 36 percent higher than large businesses so it is no surprise that regulations consistently rank as a top concern for small business owners. Roughly 3,300 regulations are in the pipeline this year and many of them will affect small businesses. 

Below are regulatory proposals that have been published in the Federal Register and are open for public comment. An agency publishes an initial regulatory flexibility analysis (IRFA) with a proposed rule if it expects that the rule will have a significant economic impact on substantial number of small businesses. The IRFA provides information about the potential effects of the proposed rule on small businesses.  

Agencies' initial analyses of small business impacts are not always correct or complete, so the Committee on Small Business encourages small businesses to file comments through the government's online portal, Regulations.gov, and tell federal agencies how the regulatory proposal will affect them. If you had trouble with an agency or regulation, please feel free to share your story with the Committee.

 


Regulations to Watch:


Department of Labor (DOL), Wage and Hour Division

Establishing a Minimum Wage for Contractors, Notice of Rate Change in Effect as of January 1, 2019

The DOL, Wage and Hour Division has issued a notice to announce the applicable minimum wage rate of $10.60 per hour for workers performing work on or in connection with federal contracts beginning January 1, 2019.  Currently, the federal contractor minimum wage is $10.35 per hour.  For tipped employees, the new minimum hourly wage will be $7.40 per hour beginning on January 1, 2019, an increase from $7.25 per hour. Executive Order 13658 establishes a minimum wage for contractors and requires the Secretary of Labor to make annual adjustments. (PUBLISHED 9-4-2018)

IRFA – No

View Notice here


Department of Commerce, National Marine Fisheries Service (NMFS)

Magnuson-Stevens Fishery Conservation and Management Act; Traceability Information Program for Seafood

The NMFS has issued a proposed rule that would establish registration, reporting, and recordkeeping requirements for U.S. aquaculture producers of shrimp and abalone. This rule would provide traceability recordkeeping requirements for these species from the point of production to entry into U.S. commerce in an effort to decrease seafood fraud. The NMFS estimates that there are 66 small businesses that would have increased recordkeeping and data storage costs of about $150 per firm. (PUBLISHED 10-11-2018)

IFRA - Yes

COMMENTS DUE 11-26-2018


Comptroller of the Currency, Federal Reserve, Federal Deposit Insurance Corporation (FDIC)

Regulatory Capital Treatment for High Volatility Commercial Real Estate (HVCRE) Exposures

The Office of the Comptroller of the Currency, the Federal Reserve, and the FDIC are proposing to amend the definition of high volatility commercial real estate to conform to the definition of high volatility commercial real estate acquisition, development, or construction (HVCRE ADC) loan, in accordance with of the Economic Growth, Regulatory Relief, and Consumer Protection Act. Specifically, this proposed rule would reduce the risk weight from 150 percent to 100 percent on some of the HVCRE loans held by financial institutions, thereby reducing capital requirements. The Federal Reserve estimates that there are 3,304 small bank holding companies, 216 small savings and loan holding companies, and 535 small and medium sized businesses that would be impacted by this proposed rule. The agencies anticipate that this proposed rule would impose administrative costs on small financial institutions of about $3,033 per institution. (PUBLISHED 9-28-2018)

IFRA – Yes

COMMENTS DUE 11-27-2018



Department of Energy (DOE), Office of Energy Efficiency and Renewable Energy

Energy Conservation Program: Test Procedure for Three-Phase Commercial Air-Cooled Air Conditioners and Heat Pumps With a Certified Cooling Capacity of Less Than 65,000 Btu/h

The DOE Office of Energy Efficiency and Renewable Energy has issued a request for information to consider whether to streamline or simplify its test procedure for three-phase commercial air-cooled air conditioners and heat pumps with a cooling capacity of less than 65,000 British thermal units per hour. DOE also invites comments on how the agency could lower the costs of its regulations for this equipment.  (PUBLISHED 10-2-2018)

IRFA - No

COMMENTS DUE 12-3-2018


Securities and Exchange Commission (SEC)

Financial Disclosures About Guarantors and Issuers of Guaranteed Securities and Affiliates Whose Securities Collateralize a Registrant's Securities

The SEC has issued a proposed rule to amend financial disclosure requirements made in connection with registered debt offerings and subsequent periodic reporting.  The agency is publishing this proposed rule to better align those requirements with the needs of investors and to simplify and streamline the disclosure obligations of registrants. The agency estimates that  1,196 small businesses are potentially subject to the proposed amendments. (PUBLISHED 10-2-2018)

IRFA – Yes

COMMENTS DUE 12-3-2018


Federal Deposit Insurance Corporation (FDIC)

Request for Information on FDIC Communication and Transparency

The FDIC has issued a request for information on the FDIC's communication methods and related initiatives to promote efficiency and increase transparency. Specifically, the agency is requesting comments on how it conducts news and updates, industry data and outreach, and general and direct communications.  (PUBLISHED 10-5-2018)

IRFA – No

COMMENTS DUE 12-4-2018


Internal Revenue Service (IRS), Department of the Treasury

Amount Determined Under Section 956 for Corporate United States Shareholders

The IRS has issued a proposed rule that would reduce the amount determined under section 956 of the Internal Revenue Code with respect to certain domestic corporations that own (or are treated as owning) stock in foreign companies. The agency estimates that the economic impact on small entities would not be significant because it is expected to marginally reduce compliance costs for smaller entities, and U.S. multinational corporations with less than 20 controlled foreign corporations generally will not have the types of arrangements in place that would otherwise need to be structured and monitored to avoid section 956 of the Internal Revenue Code. (PUBLISHED 11-05-2018)

IRFA – No

COMMENTS DUE 12-05-2018



Department of Labor (DOL), Wage and Hour Division

Expanding Employment, Training, and Apprenticeship Opportunities for 16- and 17-Year-Olds in Health Care Occupations Under the Fair Labor Standards Act

The DOL, Wage and Hour Division has issued a proposed rule that would  enhance employment, training, and apprenticeship opportunities for 16- and 17-year-olds in health care occupations in the United States while maintaining worker safety. Because DOL believes that patient lifts substantially differ in form and function from the other hazardous occupation lifts, this proposed rule would allow 16 and 17 year olds to operate patient lifts. DOL estimates that this rule would allow roughly 360,000 businesses with sales below $500,000 to have access to 16 and 17 year old workers. (PUBLISHED 9-27-2018)

IRFA - Yes

COMMENTS DUE 12-11-2018



National Labor Relations Board (NLRB)

The Standard for Determining Joint Employer Status

The NLRB has issued a notice of proposed rulemaking clarifying whether two employers are a joint employer under the National Labor Relations Act. Specifically, this proposed rule would consider a joint employer only if the two employers share the employees' essential terms and conditions of employment, such as hiring, firing, discipline, supervision, and direction. Furthermore, an employer must possess and actually exercise substantial direct and immediate control over the essential terms and conditions of employment. The NLRB expects that the majority of the 5.88 million small businesses with employees in the United States could be impacted by this proposed rule. (PUBLISHED 9-14-2018)

IRFA - Yes

COMMENTS DUE 12-13-2018



Environmental Protection Agency (EPA)

Oil and Natural Gas Sector: Emission Standards for New, Reconstructed, and Modified Sources Reconsideration

The EPA has issued a proposed rule that would amend performance standards for new or modified oil and natural gas structures. Specifically,  this proposed rule would amend requirements for fugitive emissions located at well sites, eliminate the categorical distinction between greenfield sites and non-greenfield sites for pneumatic pump requirements, amend certification requirements for closed vent system design and technical infeasibility for pneumatic pumps, clarify key terms, and other provisions. This rule is expected to apply to businesses in petroleum extraction, natural gas extraction, and pipeline distribution of crude oil and natural gas. (PUBLISHED 10-15-2018)

IRFA – No

COMMENTS DUE 12-17-2018


Small Business Administration (SBA)

Express Loan Programs; Affiliation Standards

The SBA has issued a proposed rule to amend various regulations governing its business loan programs. The agency has issued 9 proposed amendments, including amending the regulation identifying when the size status of an Applicant for financial assistance is determined with respect to applications under the SBA Express and Export Express Loan Programs, requiring owners of the small business Applicant to inject excess liquid assets into the business to reduce the amount of SBA-guaranteed funds, and other changes. The agency expects the proposed rule will impact  4,500 7(a) Lenders, all of the approximately 214 CDCs, all of the approximately 146 Microloan Intermediaries, all of the approximately 33 Intermediary Lending Program Intermediaries, and all of the approximately 32 Sureties that participate in the Surety Bond Guarantee Program. (PUBLISHED 9-28-2018)

IRFA – Yes

COMMENTS DUE 12-18-2018



Department of Labor (DOL), Employee Benefits Security Administration (EBSA)

Definition of “Employer” Under Section 3(5) of ERISA-Association Retirement Plans and Other Multiple-Employer Plans

The DOL EBSA has issued a proposed rule that would clarify the circumstances where an employer group or association may sponsor a workplace retirement plan. These multiple employer plans (MEPs) would enable groups of private-sector employers to participate in a collective retirement plan. Small businesses would be able to join MEPs as long as they are eligible to do so and the MEP sponsor meets the requirements of the proposed rule. The agency expects that businesses with less than 50 employees are the most likely to participate in MEPs. (PUBLISHED 10-23-2018)

IFRA – Yes

COMMENTS DUE 12-24-2018


National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce

Magnuson-Stevens Fishery Conservation and Management Act Provisions; Fisheries of the Northeastern United States; Industry-Funded Monitoring

The NMFS has issued a proposed rule that would implement a process to standardize future industry-funded monitoring programs in New England Council fishery management plans and the Atlantic herring fishery. The agency expects the proposed Atlantic herring measures to have economic impacts on fishery-related businesses and human communities due to the costs associated with the industry-funded monitoring measures for the herring fishery, and it estimates that there are 62 small entities that could be directly regulated. The NMFS estimates that the reporting requirements' total annual costs will be $3,121 per provider. Additionally, annual costs for carrying an at-sea monitor for Category A and B vessels is estimated to cost, on average, $13,490 per vessel, and industry-funded observer coverage for midwater trawl vessels fishing in Groundfish Closed Areas is estimated to cost, on average, $17,178 per vessel. (PUBLISHED 11-07-2018)

IRFA – Yes

COMMENTS DUE 12-24-2018


Internal Revenue Service (IRS), Department of the Treasury; Employee Benefits Security Administration (EBSA), Department of Labor; Centers for Medicare & Medicaid Services (CMS), Department of Health and Human Services

Health Reimbursement Arrangements (HRAs) and Other Account-Based Group Health Plans

The IRS, EBSA, and CMS have issued a proposed rule that would allow integrating HRAs with individual health insurance coverage, if certain conditions are met. CMS is also proposing to provide a special enrollment period in the individual market for individuals who gain access to an HRA. Specifically, this proposed rule would remove the current prohibition against integrating an HRA with individual health insurance coverage and expand the definition of limited excepted benefits. The agencies expect smaller businesses would be more likely to utilize Group Health Plans because of their ability to spread risk pools of higher and lower risk individuals. (PUBLISHED 10-29-2018)

IFRA – No

COMMENTS DUE 12-28-2018


Small Business Administration (SBA)

Small Business HUBZone Program; Government Contracting Programs

The SBA has issued a proposed rule that would amend its regulations for the Historically Underutilized Business Zone (HUBZone) Program. Specifically, the proposed rule would revise key definitions to remove ambiguities, reorganize the eligibility requirements to make them clearer, clarify the certification process, and other revisions. The SBA estimates that there are 5,000 small businesses that participate in the program. (PUBLISHED 10-31-2018)

IFRA – Yes

COMMENTS DUE 12-31-2018



The United States Copyright Office

Registration Modernization

The United States Copyright Office is building a new registration system that will incorporate a new technological infrastructure. This modernization is in an effort to improve the Office's processing times that meets the changing needs of individual creators, industry, copyright practitioners, and the general public. Other proposed changes include a more powerful dashboard, and an improved messaging system to confirm that a submission has been received and provide details on what to expect next. The Office is also seeking comments on whether there should be a mandate to use electronic applications and eliminate paper copyright applications. (PUBLISHED 10-17-2018)

IRFA – No

COMMENTS DUE 1-15-2019



Regulatory Resources:

The Regulatory Flexibility Act
Regulatory Agenda
Tips for Submitting Effective Comments