Republicans and Democrats may have found common ground in addressing the Obama administration’s regulatory overreach.
Making sure a federal agency examines the burden placed on small business before certifying a new rule is that common ground.
Examining those burdens has become especially important when it comes to the Environmental Protection Agency’s Waters of the United States rule, representing one of the largest expansions of the agency’s Clean Water Act authority affecting private land owners such as small farmers and ranchers.
Sen. David Vitter, R-La., announced at a hearing Wednesday that he is developing new legislation that would ensure that the EPA, and any other big agency, does not avoid the law in measuring the effects of its rules on small businesses.
“I want our industry representatives here today to know that I am working to develop a new reform bill in an effort to make bipartisan, common-sense reforms,” Vitter said Wednesday in his opening remarks.
The legislation will focus on regulatory reform “in light of how federal agencies oftentimes issue new rules and regulations that cause undue burden on small businesses,” he said. “While there are laws in place like the Regulatory Flexibility Act to protect small businesses, federal agencies have been taking advantage of loopholes and misinterpretation to circumvent the law.”
He said “the greatest example of this abuse of power by federal bureaucrats” occurred in 2015 when the EPA and Army Corps of Engineers’ Waters of the United States rule went into effect, significantly expanding the scope of federal jurisdiction across the country.
The water rule, also known as WOTUS, is a major target of the GOP, just behind the president’s climate change regulations. But it appears the ranking Democrat on Vitter’s Small Business Committee, Sen. Jeanne Shaheen of New Hampshire, doesn’t have much problem with holding federal agencies accountable to the law in ensuring the burdens of their rules aren’t insurmountable.
Shaheen said Wednesday that she would like to ensure the agencies meet the requirements for judging a regulation’s effects, but also want them to be reaching out to small entities to assist with compliance, rather than leaving it to them to figure it out.
“I certainly agree that poorly draft regulations can result in an excessive burden for small businesses,” Shaheen said. “Because unlike big companies, small firms often don’t have the time and resources to devote to understanding new rules to figure out how to comply.”
“For that reason, I think we need a regulatory process that works for the public, but also for America’s small businesses,” she added.
She may not agree with all aspects of Vitter’s forthcoming bill, but she does appear to be listening. She said Congress must ensure that federal agencies comply with the Regulatory Flexibility Act and the law to ensure their rules are fair to small businesses.
In addition, the government agency charged with regulating small business is not a big fan of the water rule, with the chief counsel of the Small Business Administration agreeing with Vitter’s concerns that regulatory agencies are ignoring the Regulatory Flexibility Act and other provisions meant to protect small firms, which cannot handle the compliance burden of major regulations.
Darryl DePriest, the Small Business Administration’s chief counsel for the Office of Advocacy, said the EPA and other agencies are not required to examine the impacts of their rules for businesses not directly regulated by the regulation in question, despite the effects being “foreseeable and often significant.”
DePriest said his agency is working with agencies to address the indirect effect of rules such as the Waters of the U.S.
Vitter noted that a year ago DePriest’s office told his committee that it believes the rule will impose direct costs on small businesses and those costs will have a significant economic impact on those small businesses.
It also said “the agencies incorrectly certified the rule” before conducting the necessary analysis to examine all the regulatory effects under laws meant to ensure fairness.
Vitter’s legislative proposal will seek to place a watchdog agency, such as the Government Accountability Office, in front of the regulation. But DePriest said given that courts have halted the water rule, it would be better to let the courts decide whether the EPA is following the law than let agencies duke it out.
“They can sue,” DePriest said. “It’s a round-about way, but it is the way the system is designed.”
