Rep. Luetkemeyer introduces legislation to make small business regulations more transparent

On Thursday, U.S. Rep. Blaine Luetkemeyer introduced legislation that would force federal agencies to identify the number of small businesses that would be affected by new regulations.

The Regulatory Transparency for Small Businesses Act would require that when regulations are proposed by federal agencies, the agencies identify an approximate number of small entities that would be affected by the regulation, NAICS Codes for those entities, and how much the regulations will cost the small entity. The legislation would also require the data used to determine that information.

“On top of record inflation, workforce shortages and more, overregulation is costing our small business communities hundreds of thousands every year. As of 2021, the Biden Administration has issued 817 final rules costing $482.7 billion, resulting in 292.7 million hours of paperwork,” Luetkemeyer said. “This bill will deter more harmful rules from passing by ensuring that agencies include critical information about how rules will impact small businesses before they can move forward with the rulemaking process.”

Currently, the Regulatory Flexibility Act (RFA) requires an agency believes a rule will have a significant economic impact on a substantial number of small businesses, they have to build regulatory flexibility analyses to address the cost of compliance and alternatives. However, if an agency determines that a rule will not have that kind of an impact, the head of the agency has to certify that determination before continuing with normal rulemaking procedures. Nothing in the statue defines what criteria has to be included when an agency certifies a rule will not have an impact, Luetkemeyer’s office said.

The proposed legislation would ensure that federal agencies do not overlook critical preliminary measure when they certify the rule and would force agencies to be transparent about their calculations, his office said.

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