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America Outdoors Association

January 19, 2011

America Outdoors Association Bulletin

President Calls for Streamlining Regulations, Reiterates Regulatory Flexibility Act

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President Calls for Streamlining Regulations, Reiterates Regulatory Flexibility Act 

On January 18th President Obama issued a Memorandum to federal agencies directing them “to give serious consideration to whether and how it is appropriate, consistent with law and regulatory objectives, to reduce regulatory burdens on small businesses, through increased flexibility. As the RFA recognizes, such flexibility may take many forms, including:

  • extended compliance dates that take into account the resources available to small entities;
  • performance standards rather than design standards;
  • simplification of reporting and compliance requirements (as, for example, through streamlined forms and
  • electronic filing options);
  • different requirements for large and small firms; and
  • partial or total exemptions.”

The Memorandum states that this directive has no legally binding consequence and should be considered when a regulation affects “a substantial number of small entities”.  Since this threshold is set at $100 million per year, the Memoranda will not likely provide much relief to outfitters unless the regulations involve the larger small business community.  The Memorandum essentially restates the Regulatory Flexibility Act, which requires agencies to consider reducing regulations on small business. 

Every President since Ronald Reagan has made efforts to reduce the impacts of federal regulations on small business, though arguably the outcome has not resulted in much measurable success.  The agencies always seem to find away around the regulations.  During President Clinton’s Administration in 1995, a White House conference was convened followed by a report from the Small Business Administration’s Office of Advocacy.  According to Wikipedia, a report following the conference estimated the total costs of process, environmental, and other social and economic regulations to be between $420 billion and $670 billion in 1995. The report estimated that the average cost of regulation was $2,979 per employee for large firms with 500 or more employees and $5,532 per employee for small firms with fewer than 20 employees.

President Clinton signed a revision to the Regulatory Flexibility Act (RFA) into law in 1996.   Public Law 104-121, the Small Business Regulatory Enforcement Fairness Act (SBREFA) requires agencies to consider the impacts of regulations on small business:

  • the final regulatory flexibility analysis including the agency's efforts to evaluate alternative regulatory approaches and reasons for rejecting or accepting them;
  • the agency's effort to collect comments from small entities through a variety of mechanisms;
  • the agency's decision to certify that a rule will not have a significant impact on a substantial number of small entities, and the factual basis for the certification;
  • the agency's compliance with a requirement for periodic reviews at the 10-year anniversary of every rule or the enactment of the 1980 law, whichever is first.
  • the new law also updates the requirements of a final regulatory flexibility analysis -- including a description of the steps an agency has taken to minimize the significant economic impact on small businesses.

Although AOA will definitely use this argument on some of the regulatory issues outfitters are facing, unless the White House really presses the agencies not much will happen.  A good example of why not to expect much can be found in the Forest Service rule-making on cost recovery for permit administration.   Although originally recognizing the negative impact on outfitters and guides, the Forest Service concluded in the final rule on cost recovery for permit administration that their Regulatory Flexibility Act (RFA) analyses found “the final rule will not have a significant economic impact on a substantial number of small entities”.  By the way, most agencies have never completed the 10-year review of their rules required by the law, which would take an enormous amount of time and resources.

Read Memorandum.

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