[House Hearing, 112 Congress]
[From the U.S. Government Publishing Office]

MARKUP OF H.R. 527, REGULATORY FLEXIBILITY IMPROVEMENTS ACT OF 2011,
AND H.R. 585, SMALL BUSINESS SIZE STANDARD FLEXIBILITY ACT OF 2011

=======================================================================

HEARING

before the

COMMITTEE ON SMALL BUSINESS
UNITED STATES
HOUSE OF REPRESENTATIVES

ONE HUNDRED TWELFTH CONGRESS

FIRST SESSION

__________

HEARING HELD
JULY 13, 2011

__________

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HOUSE COMMITTEE ON SMALL BUSINESS

SAM GRAVES, Missouri, Chairman
ROSCOE BARTLETT, Maryland
STEVE CHABOT, Ohio
STEVE KING, Iowa
MIKE COFFMAN, Colorado
MICK MULVANEY, South Carolina
SCOTT TIPTON, Colorado
JEFF LANDRY, Louisiana
JAIME HERRERA BEUTLER, Washington
ALLEN WEST, Florida
RENEE ELLMERS, North Carolina
JOE WALSH, Illinois
LOU BARLETTA, Pennsylvania
RICHARD HANNA, New York
ROBERT T. SCHILLING, Illinois
NYDIA VELAZQUEZ, New York, Ranking Member
KURT SCHRADER, Oregon
MARK CRITZ, Pennsylvania
YVETTE CLARKE, New York
JUDY CHU, California
DAVID CICILLINE, Rhode Island
CEDRIC RICHMOND, Louisiana
JANICE HAHN, California
GARY PETERS, Michigan
BILL OWENS, New York
BILL KEATING, Massachusetts

Lori Salley, Staff Director
Paul Sass, Deputy Staff Director
Barry Pineles, General Counsel
Michael Day, Minority Staff Director

C O N T E N T S

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Opening Statements

Page
Hon. Sam Graves.................................................. 1
Hon. Nydia Velazquez............................................. 2

Appendix

Additional Materials for the Record:
Legislation.................................................. 27
Business Letter on H.R. 527, the Regulatory Flexibility
Improvements Act of 2011................................... 35
Letter from National Restaurant Association and National
Retail Federation.......................................... 49

MARKUP OF H.R. 527, REGULATORY FLEXIBILITY IMPROVEMENTS ACT OF 2011;
AND H.R. 585, SMALL BUSINESS SIZE STANDARD FLEXIBILITY ACT OF 2011

---------- --
--------

WEDNESDAY, JULY 13, 2011

House of Representatives,
Committee on Small Business,
Washington, DC.
The Committee met, pursuant to call, at 1:02 p.m., in room
2360, Rayburn House Office Building, Hon. Sam Graves (Chairman
of the Committee) presiding.
Present: Representatives Graves, Bartlett, Chabot, King,
Coffman, Mulvaney, Tipton, Landry, Herrera Beutler, West,
Ellmers, Walsh, Barletta, Hanna, Velazquez, Schrader, Critz,
Altmire, Clarke, Chu, Cicilline, Peters, Owens and Keating.
Chairman Graves. Good afternoon. We are going to bring the
Committee meeting to order.
During the past 2 years, Federal agencies have dramatically
expanded their regulatory reach. Those regulations imposed
substantial costs on small businesses. So the scarce financial
resources which could be used to hire employees must be
diverted to regulatory compliance.
In response to this ever-expanding burden, President Obama
on January 18th ordered the agencies that had been imposing
these burdens to consider the impact on small businesses. He
became the third straight President ordering Federal agencies
to examine the consequences of their rules on small businesses,
something that agencies have had to do for the past 30 years
under the Regulatory Flexibility Act, or the RFA.
In addition to the efforts of three Presidents,
congressional committees in both Houses and under Republican
and Democrat leadership have held hearings about agency failure
to comply. And finally, Federal courts have enjoined
enforcement of rules until agencies prepared analyses required
by the RFA.
Despite the concerted oversight efforts, Federal
bureaucrats continue to ignore the RFA. It is incomprehensible
to me that agencies remain either unable or unwilling to comply
with the RFA. The legislation being considered at this markup
was written with the express purpose of finally forcing
agencies to live up to their responsibilities and really
scrutinize the impact of their actions on small businesses.
Some people may ask why there is so much concern about
compliance with the RFA. The answer is simple. Ninety-nine
percent of the businesses regulated by the Federal Government
have less than 500 employees. If you are going to regulate
businesses, it seems utterly logical that the Federal agencies
actually know what the consequences will be for almost all of
the businesses that have to comply with their rules.
The bills being considered at this markup are H.R. 527 and
H.R. 585, simply have procedures and requirements to ensure
Federal agencies understand the costs they are imposing on the
99 percent of the businesses that they regulate.
Chairman Graves. With that, I will now recognize Ranking
Member Velazquez for her opening statement.
Ms. Velazquez. Thank you, Mr. Chairman.
No task before this Committee, indeed for all of Congress,
is more important than helping small businesses create new
jobs. With recent surveys suggesting that almost two-thirds of
small firms are hesitant to hire more workers, all options
should be on the table as we consider ways to foster small
business job growth.
The two bills before the Committee today are certainly
focused on issues critical to entrepreneurs. Ensuring small
companies are not needlessly burdened by regulation is
important to helping small firms expand. Small enterprises with
fewer than 20 employees are disproportionately affected by
regulations, paying 36 percent more in regulatory costs than
their larger counterparts. Ensuring Federal agencies take
effects like this into account when implementing new rules is
vital for our economy's long-term health.
On a similar note, small business size standards are also a
critical matter, determining which firms qualify for a wide
range of technical assistance and counseling, to say nothing of
billions of dollars in Federal procurement actions that are set
aside for small companies each year.
While I agree these are important topics that we must
address, during our previous hearings the Committee heard
numerous misgivings about the two bills before us. As just one
example, a witness invited by the majority testified that the
SBA's Office of Advocacy does not have the resources or
expertise to take responsibility for setting size standards.
Other concerns center on whether the legislation expands the
Regulatory Flexibility Act too broadly, making the system
inefficient.
Unfortunately, matters like these have gone completely
unaddressed in the legislation before the Committee today. If
we are to enact legislation that achieves the Committee's
goals, then more efforts should be made to correct the
weaknesses in these two bills.
I am also concerned procedurally with issues that will
cause problems going forward. H.R. 527, the regulatory bill we
are marking up, is different from the measure recently approved
by the House Judiciary Committee. How the legislative product
coming from this Committee will be reconciled with the
Judiciary Committee's remains an open question. It will be
particularly disconcerting if Members' amendments prepared for
today's markup are ultimately discarded when a final package
moves to the Rules Committee and then to the floor.
Mr. Chairman, Members on both sides of the aisle recognize
the need to reduce small business regulatory burdens and reform
the SBA size standard system; however, I remain concerned that
the legislation before us today does not reflect the best work
of the Committee. If we are to truly support America's small
businesses, we must develop legislation that makes not just for
good sound bites, but also for effective policy.
I thank the chairman for yielding.
Chairman Graves. Thank you, Ranking Member Velazquez.
Are there any other Members that wish to be recognized for
the purpose of making an opening statement? If not, we will
move forward.
The way I am going to do this, I want to make sure
everybody has a chance to offer their amendment. I know we have
a couple of conflicts, mainly Education and Workforce. And I
think, Mr. Schrader, you have a conflict, too, possibly with
Natural Resources' votes that are coming up.
What we are going to do is we will offer the amendments. We
will go through 527 first, which is where most of the
amendments are. If there are any recorded votes, then we will
roll those, because I don't want to hang up anybody on that
either. So we will try to accommodate everybody on this. And
then the second bill I don't think there is too much
controversy.
So we will move right on into our first item on our agenda,
which is H.R. 527, the Regulatory Flexibility Improvement Act
of 2011. The bill strengthens the RFA by closing loopholes that
agencies have used to avoid compliance. Of the major changes
made in the bill are mandating analysis of indirect effects,
something that is already required in environmental impact
statements; limiting the ability of the Internal Revenue
Service to avoid compliance with the RFA; requiring more
detailed assessments, thereby providing an enhanced review of
agency compliance and challenges to agency regulations; and
empowering the Office of Advocacy to write governmentwide
regulations for agencies to follow in implementing the RFA.
This last requirement is by far the most significant in the
bill. And when a dispute occurs over the interpretation of the
RFA between the Office of Advocacy and the agency, of course we
will defer to the Office of Advocacy's interpretation of the
RFA.
The changes made in this legislation will, in the words of
President George W. Bush, care that the law is on the books.
Despite the increased analysis required under H.R. 527, nothing
in the legislation will prevent an agency from issuing a rule
in the manner that it wants.
I now recognize Ranking Member Velazquez for any remarks
she may have.
Ms. Velazquez. Thank you, Mr. Chairman.
As we all know, recent jobs data confirmed that economic
recovery is turning out to be a roller coaster ride rather than
a steady climb. In April, 217,000 new jobs were created. Well,
this changed dramatically while only 18,000 jobs were added
last month.
In order to smooth out this growth, we need entrepreneurs
to participate in the economy more than ever. That means giving
them access to capital and the ability to compete for Federal
Government contracts. It also means allowing them to start up
and grow stronger, but without the massive costs of unnecessary
regulations.
Unfortunately, it is these very small businesses that bear
the largest burden of Federal regulation. As of 2008, these
entrepreneurs faced an annual regulatory cost of $10,500. To
address this very real problem, the Regulatory Flexibility Act
was enacted in 1980 to give small businesses a louder voice in
the regulatory process. It has been successful as regulatory
costs were reduced by $15 billion in 2010.
Even though RFA has improved the regulatory environment for
small firms, it could do better. The legislation before us
attempts to do so and on many fronts does this well. But in
other areas I have major concerns that it overreaches and
saddles SBA's Office of Advocacy with responsibilities that
they cannot and do not want to handle.
There are areas where I believe that there is broad
agreement to improve the RFA. This includes making agency
analysis more detailed so that agencies cannot ignore RFA and
simply certify that a rule has no significant economic impact
on small businesses. Addressing this matter will ensure that
agencies are required to provide a more factual basis for such
certifications, rather than just a sentence which dismisses the
concerns of small firms.
It is also important to give real teeth to section 610,
which requires the agency to review outdated regulations that
remain on the books, yet which continue costing small
businesses money. While the RFA requires agencies to
periodically review its system rules, these requirements are
ambiguous, and agencies often do not apply them consistently.
As a result, these reviews have been much less effective than
they could be.
However, several of the proposed changes that we are
discussing today are sweeping in nature and will give immense
power to the Office of Advocacy, all at the expense of
taxpayers. While Advocacy's role is critical to small
businesses--it has a body of 9 million and 46 employees--it is
already taxed in meeting its current role, and expanding its
powers to include the offering of regulations and convene a
panel governmentwide is well beyond its capacity.
Members on this Committee are aware of the fiscal
constraints facing the U.S. Government. Now is not the time to
make statutory leaps when smaller steps might be appropriate.
We must be mindful of the taxpayers who are footing the bill.
Since being signed into law more than 30 years ago, the
Regulatory Flexibility Act has played an essential part in
reducing regulatory burden. As we move forward on this
legislation, I believe that there is a better way to accomplish
this goal, but without simply shifting the costs from small
businesses to taxpayers. By doing so we can best ensure that
entrepreneurs will be the catalyst for job creation that our
economy needs. And with that I yield back, Mr. Chairman.
Chairman Graves. Thank you, Ranking Member Velazquez.
Are there any other Members that wish to be recognized for
a statement on H.R. 527?
Seeing none, the Committee now moves to consideration of
H.R. 527. The clerk will report the title of the bill.
The Clerk. H.R. 527, to amend chapter 6 of title 5, United
States Code, commonly known as the Regulatory Flexibility Act.
Chairman Graves. I would ask unanimous consent that H.R.
527 be considered as read and open for amendment in its
entirety.
And with that, we will just go through the amendments as
they came in, the first two being Mr. Owens'.
Do you want to bring up amendment number 1? You are
recognized for that purpose.
Mr. Owens. Thank you very much, Mr. Chairman.
I offer this amendment to provide that regulations or the
plan be written in such a way that we utilize plain language.
That is something which greatly impacts small businesses as
they try and get through, if you will, governmentese or
legalese, and we look to make these not necessarily more
simple, but more clear so that people can interpret and
understand what they are being asked to do.
And we also are requiring in this amendment that the agency
shall solicit input from affected small entities or
associations of affected small entities so that, in fact, there
is a compelling reason for the agency to go forward and reach
out to small businesses.
As we know, small businesses are the job creators in our
communities, and particularly in a rural district like mine,
small business entities really are the lifeblood of what
happens throughout our communities. So I would urge adoption of
this amendment.
I yield back.
Chairman Graves. Is there any further discussion or anyone
that wishes to be heard on the gentleman's amendment?
Seeing none, the amendment by the gentleman from New York
makes abundant sense, in my opinion, and I wish to accept it.
All those in favor, say aye.
All opposed.
It is the opinion of the chair that the ayes have it. The
ayes do have it.
Mr. Owens, your second amendment.
Mr. Owens. Thank you, Mr. Chairman.
The second amendment really addresses the same issue in
that it requires or lays out how an agency will go through the
outreach program so that, in fact, small businesses do have the
opportunity to have input into the plans as they are developed
by the agency. And again, we rely, in my district and in many
districts throughout the United States, on small businesses for
not only the development of jobs, but really the social fabric
of the community. And again, I would urge adoption of this
amendment.
Chairman Graves. Does any other Member wish to be heard on
the gentleman's amendment?
Seeing none, I do support the gentleman's amendment. I
think he did a good job of describing it. So with that, the
question is on amendment number 2 by Mr. Owens. All those in
favor, say aye.
All opposed, no.
The ayes appear to have it. In the opinion of the chair,
the ayes do have it. The amendment is adopted.
We will next move to Mr. Schrader. Yours came in third. I
think you have one amendment.
Mr. Schrader. Yes, sir. Thank you, Mr. Chairman.
This is a fairly simple, commonsense amendment that
hopefully promotes transparency and a more open government for
America's small businesses. At home I think we all hear that
small business owners are not even aware of some of these
Federal regulations that come out in rulemakings, and if they
do come out, they don't understand them. So my amendment
highlights the obligation of the Federal Registrar to
biannually transmit a list of the rulemakings that have an
economic impact on small entities. This amendment would require
every agency to make this information prominently available in
plain language on their Website on the same day it is sent to
the Federal Registrar and keep it regularly updated.
It would also make the agencies identify the businesses and
business sectors that the rules actually affect so small
businesses can better understand which regulations actually
might impact them.
I think this amendment is in line with the goals of our
Committee to simplify regulations while making government more
open and visible and more transparent. I urge the Committee to
pass the amendment, please.
I yield back.
Chairman Graves. Does any other Member wish to be heard on
Mr. Schrader's amendment?
Seeing none, I support the amendment, and I am willing to
accept it. With that, the question is on the amendment by Mr.
Schrader, which is amendment number 3. All those in favor, say
aye.
All those opposed, no.
The ayes appear to have it. The ayes do have it. The
amendment is adopted.
Next we will move to Ranking Member Velazquez for your
amendments.
Ms. Velazquez. Amendment number 6.
Chairman Graves. It is amendment number 6.
Ms. Velazquez. Mr. Chairman, I have an amendment at the
desk.
Chairman Graves. The ranking member is recognized. Can you
read the amendment?
The Clerk. Amendment to H.R. 527, page 17, line 12, insert
after ``entities.'' the following.
Chairman Graves. I would ask unanimous consent----
Ms. Velazquez. I ask unanimous consent that the amendment
be considered as read.
Chairman Graves. Seeing no objections, so ordered.
Is that the right one?
Ms. Velazquez. Mr. Chairman, with Americans tightening
their belts, we must be especially careful how taxpayers'
dollars are spent. In this budget-conscious time, it is
critical that we have a close accounting for every government
expenditure. Fiscal responsibility starts with transparency. We
all want to make the regulatory appeal process smoother and
fairer for small businesses; however, entrepreneurs will also
want to know what the cost of those changes will be. After all,
small businesses that are struggling to rebound from this
recession don't have the luxury of spending money they do not
have.
My amendment will bring additional transparency to the
process so that we can easily track costs incurred by the new
panel system. If we are going to fundamentally alter the
regulatory review system, it seems like common sense to keep
close tabs on the financial ramifications of these changes. In
addition, the public and Congress could see how those costs are
broken out, providing further protection against any wasteful
behavior. Not only will this prevent abuse, but it will help
ensure that taxpayers are getting bang for their buck.
Mr. Chairman, all of us want the regulatory review process
to work better, but we should also have a clear handle on
expenses that come from changing the system. American taxpayers
are carefully monitoring their own budgets and tracking every
dollar they spend. Most small businesses are doing the same.
This amendment simply ensures that this bill adheres to the
same standard, and I urge my colleagues to support this
amendment.
Chairman Graves. Does any other Member wish to be heard on
the amendment?
Seeing none, the amendment is going to require that chief
counsel prepare a report on the costs associated with
conducting the panels to obtain small entity input prior to
publication of the proposed rules in the Federal Register,
which I would raise two objections. First, the cost and time to
prepare the report actually detract from the ability of the
Office of Advocacy to conduct panels. And second, agencies
regularly obtain prepublication input as part of the rulemaking
process, and the cost of such meetings isn't tracked. As a
result, I cannot support the amendment.
Ms. Velazquez. Under the legislation--Mr. Chairman, if you
would yield----
Chairman Graves. I will yield.
Ms. Velazquez [continuing]. The agency has to provide a
report. And what we are only asking is to add the cost of this
panel. I think that this Committee has been given no cost
information about all these authorities, and this amendment
will accomplish that. For a party that talks about controlling
costs, it is ironic that you don't even know how much this is
going to cost to taxpayers. This is about accountability and
transparency.
Chairman Graves. Yield back?
Ms. Velazquez. I yield back.
Chairman Graves. With that, the question is on the
amendment number 6, offered by Ranking Member Velazquez. All
those in favor, say aye.
All opposed, no.
Ms. Velazquez. The ayes have it.
Chairman Graves. The noes appear to have it. The noes do
have it.
Ms. Velazquez. I ask for a recorded vote.
Chairman Graves. Absolutely. A recorded vote has been
ordered. A recorded vote has been ordered pursuant to rule 10
of the Committee's rules. Proceedings on the amendment will be
postponed. Again, we want to make sure everybody is here when
we do our votes so that we don't hang anybody on that.
Ranking Member Velazquez, you are recognized for----
Ms. Velazquez. Mr. Chairman, I have an amendment at the
desk. It is amendment number 7.
Chairman Graves. Amendment number 7. Will the clerk please
read the title?
The Clerk. Page 3, line 12, insert before the period at the
end the following----
Chairman Graves. I ask unanimous consent that the bill be
considered as read. Seeing no objections, I yield to Ranking
Member Velazquez.
Ms. Velazquez. Thank you, Mr. Chairman.
I think we are all united by our desire to help small
businesses, and this is why we are here today. Of course, it is
clear that there are different approaches to accomplish this.
Some have seemed to suggest that the best way to help
entrepreneurs is by grinding the regulatory process to a halt.
They have often cited the challenges of tax and health care
matters. However, attempting to slow regulation could actually
harm small businesses in certain cases.
There is clearly one area of regulation that I think we can
all agree where stymieing the process could hurt small
businesses, and this is regulations issued by the SBA regarding
lending, investment, contracting and entrepreneurial
development. These regulations actually help small businesses
get the resources they need. They are not onerous. Rather, they
just do the opposite. They allow small businesses to get access
to capital, procurement opportunities or technical assistance.
These regulations allowed the agency to provide entrepreneurs
with more than $20 billion in capital last year. Without such
rules, business owners will be unable to apply for loans, and
many will go without the financing they need.
In addition, there are many instances where the SBA might
establish a new investment program for veterans returning from
the war in Afghanistan. And if they do, we should make sure
that nothing stands in SBA's way to get this initiative up and
running quickly.
Unfortunately, while well intentioned, H.R. 527 is a one-
size-fits-all policy that views all regulations as being bad
for businesses. This is far from the case when it comes to the
SBA, who is charged with helping small businesses. The truth is
that H.R. 527 will cause delays in the issuance of regulations
at the SBA. This means that small businesses will have to wait
longer for critical capital, contracts or technical assistance,
resulting in slower job creation in our communities.
With the economy struggling with high unemployment, we need
to be doing everything we can to help small businesses hire
more people. Enabling the SBA to channel its resources to
entrepreneurs more expeditiously will do this. For this reason
I urge a yes vote on this amendment, and I yield back the
balance of my time.
Chairman Graves. Does any other Member wish to be heard on
the amendment?
Seeing none, I cannot support the amendment simply because,
you know, the SBA is one agency that should ensure its
regulations maximize its benefits to small businesses. The
point here is to strengthen the RFA, to make sure that
regulations either do the least amount of harm or the most good
for small businesses. And I think it should apply in full force
to the SBA, if no other agency.
So with that, the question is on the amendment number 7
offered by Ranking Member----
Ms. Velazquez. Mr. Chairman, if you will yield.
Chairman Graves. I would yield.
Ms. Velazquez. You know, when we pass any legislation here
to create a new venture capital, small business lending, and
Members will come back to ask questions as to why that program
is up and running, then you are going to have the SBA
Administrator here telling us it is happening, and it is your
fault because we enacted legislation that is a one-size-fits-
all policy, applying to everything that is related to Federal
agencies, including SBA when we need to put money into the
hands of small businesses. We will be responsible for not doing
that quickly as we need in order for them to create jobs.
Thank you for yielding.
Chairman Graves. Absolutely. And I again reiterate that the
purpose of the RFA is to make sure that agencies, when they
pass rules and regulations, don't harm small businesses. And I
think it should apply to the SBA just as it applies to
everybody else.
So with that, the question is on the amendment number 7
offered by Ranking Member Velazquez. All those in favor, say
aye.
All those opposed, no.
Ms. Velazquez. The ayes have it.
Chairman Graves. The noes appear to have it. The noes do
have it. The amendment is----
Ms. Velazquez. Recorded vote, Mr. Chairman. Recorded vote.
Chairman Graves. Absolutely. Pursuant to a recorded vote--
pursuant to rule 10 of the Committee's rules, proceedings on
the amendment will be postponed.
We will move to Mr. Critz, and you have an amendment. Which
one?
Mr. Critz. Critz amendment 18.
Chairman Graves. Eighteen. Number 8.
Mr. Critz. Oh, number 8.
Chairman Graves. I hope we don't have 18.
Mr. Critz. Eight on your list.
Chairman Graves. Would the clerk please read the title,
Critz amendment number 8?
The Clerk. Page 17, line 9, insert after ``small entities''
the following.
Chairman Graves. I would ask unanimous consent that the
amendment be considered read. Seeing no objections, the
amendment is considered read.
And I yield to Mr. Critz for an explanation of your
amendment.
Mr. Critz. Thank you, Mr. Chairman.
My amendment is quite simple. It would require the Small
Business Advocacy Review Panel to report--report to include an
assessment of a proposed rule's impact on the cost small
entities pay for energy.
Volatility and fluctuations in energy prices and supply
disproportionately impact the small business sector,
particularly those in transportation-related industries. This
would require that the reports issued by Small Business
Advocacy Review Panels include an assessment of a proposed
rule's impact on the cost of energy to small business. It would
provide agencies with vital information about how a regulation
could be modified so that small businesses would incur lower
energy prices.
With the price of gas as it is, and with the discovery of
natural gas across regions of Pennsylvania, we see a
possibility of really lowering our energy costs and doing good
things for small business. And as we know, any increase in
costs has a stronger or a larger impact on small business, who
have less flexibility. So my proposed amendment is only to make
sure that any proposed rule that we are looking at, what the
impact is to energy costs. And I yield support for my amendment
and yield back.
Chairman Graves. Does any other Member wish to be heard on
the amendment?
I think this should be assessed under the total cost of the
proposed rule, but I believe the gentleman's clarification on
energy is entirely appropriate. And with that, I support the
amendment.
The question is on the amendment number 8 by Mr. Critz. All
those in favor, say aye.
All those opposed, no.
The ayes appear to have it. The ayes do have it. The
amendment is adopted.
Mr. Critz, you have amendment number 9?
Mr. Critz. Yes, Mr. Chairman.
Chairman Graves. Would the clerk please read the title.
The Clerk. Page 18, insert after line 11 the following, and
redesignate succeeding subsections accordingly.
Chairman Graves. I ask unanimous consent that the amendment
be considered as read. Seeing no objections, we will move
forward.
Mr. Critz, you are recognized on amendment number 9.
Mr. Critz. Thank you, Mr. Chairman.
As much of the discussion that has been going on in the
public eye and in Congress, we have been talking about trade
agreements. And as a member of this panel, obviously we want to
make sure that when this country is negotiating trade
agreements, we see and protect the interests of small business
and see what the impact would be on them. And that is why I
offer this amendment. But in discussions with leadership, I
think the best way forward is that I am going to withdraw this
amendment so that I can work with the leadership to make sure
that there is protections for small business, and therefore I
withdraw my amendment, Mr. Chairman.
Chairman Graves. Thanks, Mr. Critz. And I assure you we
will work with you and try to figure out if we need to do
anything or make sure what you are trying to address is in the
bill.
I now recognize Ranking Member Velazquez. We have number 5
and number 4.
I might let the Committee know that we--there is votes--
seven votes started in Education and Workforce. So as soon as
they get through those, we will--and hopefully they will be
through with them by the time we bring the votes back up.
Again, we want to make sure we don't hang anybody on votes, so
we will wait until everybody gets here.
Ms. Velazquez. I have an amendment at the desk, and this is
amendment number 4.
Chairman Graves. Would the clerk please read the title,
amendment number 4, Ranking Member Velazquez.
The Clerk. At the end of the bill--add, at the end of the
bill, the following.
Chairman Graves. I would ask unanimous consent that the
amendment be considered as read. Seeing no objections----
Ms. Velazquez. Thank you, Mr. Chairman.
Chairman Graves. I recognize----
Ms. Velazquez. Our Nation's debt has reached a critical
level as evidenced by the ongoing negotiations surrounding the
debt ceiling. With this in mind, all Committees must be careful
as they create new programs such as the ones in H.R. 527 which
entail significant costs.
H.R. 527 establishes sweeping new authorities and
responsibility for the Office of Advocacy. This includes
expanding the panel process to every government agency from 3
to 50-52, while currently it is only at 3 agencies. The bill
also requires Advocacy to issue rules and reflect subject IRS
interpretive rules and land management plans to the RFA.
These are significant new obligations for Advocacy, which
only has a $9 million budget and 46 employees. I am sure that
this is not an accident that H.R. 527 contains no authorization
of funding to carry out these provisions. And given the fiscal
constraints we are operating under, now is not the time to be
expanding the bureaucracy. Therefore, the amendment I am
offering is meant to provide an airtight guarantee that this
bill will not spend taxpayers' dollars that we don't have. It
simply clarifies that SBA cannot spend any new funds to
implement the act. If it does spend new money, it cannot
increase the Federal budget deficit.
These requirements will ensure that H.R. 527 is not adding
to the debt that we are all so concerned about. All committees
are encountering this issue, and we must play our part. We need
to be more careful about spending taxpayers' money, and
including an ironclad guarantee in this bill accomplishes that.
If Members wish to truly reduce the Nation's deficit, then
supporting this amendment should be noncontroversial. With the
Federal debt exceeding 14 trillion, we cannot simply pass a
bill, even if they have important goals, and just hope that it
does not cost too much. We need to take a stand and make sure
the work we do this year does not add to the debt. I urge my
colleagues to not only talk the talk, but walk the walk by
ensuring this bill does not add red ink to our budget deficit.
With that, I ask a yes vote and yield the balance of my time.
Chairman Graves. Does any other Member wish to be heard on
the amendment?
Mr. Schrader.
Mr. Schrader. Just a point of inquiry. I mean, how are we
going to pay for this at the end of the day? What is the plan?
Chairman Graves. Well, I will refer to counsel.
Chief Counsel. I wouldn't actually expect that the
requirements set forth in this bill will actually add any
additional costs to the ongoing rulemaking process. The Office
of Advocacy already reviews every agency's regulations, having
worked in that office for over 9 years. They actually review
every agency's regulation. The other agencies that would be
involved in the panel process, for example, already have
significant numbers of employees devoted to the rulemaking
process. Having them meet seems to be--would seem to be a
fairly logical result of attempting to gather information prior
to the publication of the proposed rule. So I would argue that
it would have no increase in the impact on costs.
Mr. Schrader. I am sorry. Just one further clarification,
Mr. Chair. Just trying--but if the agency is now making rules,
not just responding, wouldn't that require more time and effort
they would have to research stuff and convene themselves
themselves? Did I misunderstand that?
Chief Counsel. Well, the agencies clearly will have to
gather more information, but I would argue that, for example,
for many of the rules that would be covered with additional
analysis under this bill, they are already required to do that
type of analysis under Executive Order 12866, which requires
agencies for significant rules to do a complete benefit-cost
analysis. For rules that the agency would have a significant
environmental impact, and there are a lot of rules that
actually do, agencies are already required to comply with the
requirements that are issued by the Council on Environmental
Quality to access indirect socioeconomic impacts.
So I would suggest that it is most likely that the data is
already out there. It just needs to be tailored in a manner to
assess the adequacy of the impact on small business as opposed
to the data now simply being there in this--well, there is this
economic impact, but we haven't actually focused on the
consequences to small business. So that is what this would do.
I don't think the data gathering that is already going on would
add any additional costs because they should already be doing
that data gathering if they are going to do rational
rulemaking.
Ms. Velazquez. Would the gentleman yield?
Chairman Graves. Not quite. You have still got a little bit
of time. But regardless, I will recognize the ranking member,
and then I will make a statement.
Ms. Velazquez. It is just beyond me. You could dance all
over this question all day around, but how could you say that
this is not going to require more resources when you are adding
over 50 new agencies to the panel process? And this is
Washington, and this is the Federal Government. So if it is not
going to add any more costs, then the chairman will have no
problem accepting my amendment, because this is exactly what I
am asking for.
And with that, I yield back.
Chairman Graves. You know, under this amendment--and I will
reclaim the time. But under this amendment, you know, all we
are asking that Federal agencies to do is their job.
Bottom line is is that Federal agencies implement
regulations that are burdensome to businesses, whether it is
the Federal deficit or a budget surplus. It doesn't make any
difference one way or the other. I want to know when a Federal
agency is proposing something that is going to cost small
businesses a lot of money, and there are certain things that
the Federal Government should be doing no matter what, and this
is one of them. This is something that needs to be done, and,
again, it is the law. They are supposed to be doing it. We are
going to put some teeth into it to make darn sure they are
doing it. I want to make sure we know and the Federal
Government is preventing businesses from doing what businesses
want to do.
With that, the question is on the amendment number 4, by
Ranking Member Velazquez. All those in favor, say aye.
All those opposed, no.
Ms. Velazquez. Mr. Chairman, I am sorry. Just one inquiry.
What will happen if the report comes back from the CBO and it
does show that it is going to cost more money than the $9
million that has been allocated? What will happen? What are we
going to do? That is my only question.
Chairman Graves. We will deal with it then. But the bottom
line is I want the Federal agencies to do their job.
Going back to the vote. All those in favor, say aye.
All those opposed, no.
The noes appear to have it. The noes do have it. The
amendment is not adopted.
Ms. Velazquez. I ask for a recorded vote, Mr. Chairman.
Chairman Graves. A recorded vote has been requested
pursuant to rule 10 of the Committee's rule. Proceedings on the
amendment shall be postponed.
You have number 5?
Ms. Velazquez. Yes, sir. I have an amendment at the desk,
amendment number 5.
Chairman Graves. The clerk will please read the amendment.
The Clerk. Strike all after the enacting clause and insert
the following.
Ms. Velazquez. I ask unanimous consent that the amendment
be considered as read.
Chairman Graves. Seeing no objection, the ranking member is
recognized.
Ms. Velazquez. The Regulatory Flexibility Act has served
small businesses well, reducing regulatory costs by $15 billion
in 2010 alone. Yes, it could do better, and the substitute
amendment before us does it. However, unlike H.R. 527, this
substitute does not create what amounts to an array of unfunded
mandates on the Office of Advocacy.
This substitute is the same bipartisan legislation,
bipartisan, introduced by our Committee and by our former
colleague Brad Ellsworth from a previous Congress. At the time
this Committee worked in a bipartisan manner and reported it
out by a recorded vote of 26 to 0.
It makes improvements to the most significant deficiencies
facing RFA without the sweeping and expensive changes of H.R.
527. This includes making sure that agencies live up to their
obligations to review the burdens of existing rule on small
businesses. The GAO has reported on numerous occasion that
agency compliance with this requirement was poor. My amendment
holds the agencies more accountable by requiring them to report
the results of their reviews to Congress annually.
This substitute also addresses what the Chief Counsel for
Advocacy has described as the biggest loophole in the law: the
fact that agencies do not have to consider the full economic
impact of the rules and regulations on small businesses. By
fixing this problem, my amendment will require agencies to
consider the indirect impacts of the rules on small businesses.
Steps are also taken to make red flag analysis more
detailed so that agencies cannot ignore the RFA and simply
certify that a rule has no significant impact on small
businesses. Addressing this matter will ensure that agencies
are required to provide a more factual basis for such
certifications, rather than just a sentence which dismisses the
concerns of small firms.
Unlike H.R. 527, this substitute does not create a new
governmentwide bureaucracy or foist new responsibility on the
Office of Advocacy, which only has a $9 million budget.
Instead, this substitute makes the most important changes to
the RFA that small businesses have called for over the last 5
years. In doing so, it is cost-effective and responsible to the
taxpayers.
When it was developed in a prior Congress, both sides of
the aisle and the small business community had a hand in
developing it. As a result, the substitute will strengthen red
flags and help stop the growth of small business compliance
costs. I urge Members to vote yes, and I yield the balance of
my time back.
Chairman Graves. Does any other Member wish to be heard on
the amendment?
Seeing none, the amendment in the form of a substitute by
the gentlelady from New York, it obviously recognizes the RFA
and the analysis done under it needs strengthening. But given
the increased regulatory burden that is coming out of this
administration, I think that much bolder action needs to be
taken, and that is the reason we came up with 527, in which
case I cannot support the gentlelady's amendment.
With that, the question is on the amendment number 5, the
gentlelady from New York, Ms. Velazquez.
Ms. Velazquez. Mr. Chairman, I just would like to add this
is Brad Ellsworth's bill. He wasn't a liberal, didn't get any
score on liberal caucus. Very conservative. The legislation was
a bipartisan bill. And I assure you that this legislation that
is going to be reported today will not be passed on the Senate
nor signed by the President.
Here we are seeking solutions to small business needs, and
rather than passing something to score political points, we
should pass something that has bipartisan support and get it
done on behalf of small businesses.
With that, I yield back. Thank you.
Chairman Graves. The question is on the amendment number 5
by Ranking Member Velazquez. All those in favor, say aye.
All those opposed, no.
The noes appear to have it.
Ms. Velazquez. Recorded vote.
Chairman Graves. A recorded vote has been requested.
Pursuant to rule 10 of the Committee's rules, proceedings on
the amendment shall be postponed.
Are there any other amendments to H.R. 527?
Seeing none, the Committee is going to stand in recess
shortly until we get the rest of our Members up here. And
again, I said that I don't want to hang any Member when it
comes to votes, and so we are going to stand in recess for a
very short period of time. After that we will take up the next
bill, which should not take very long at all. With that, we
will stand in recess shortly and get everybody up here.
[Recess.]
Chairman Graves. We will go ahead and bring the hearing
back to order.
We have four amendments that recorded votes were requested
on. We will go through those real quick, and then we will
dispose of H.R. 585 real fast, which shouldn't take long at
all.
Right now the question occurs on agreeing to the amendment
offered by Representative Velazquez, which a recorded vote was
ordered. The first one is going to be Velazquez number 6. Go
ahead and call the roll.
The Clerk. Mr. Graves?
Mr. Graves. No.
The Clerk. Mr. Graves votes no.
Mr. Bartlett?
Mr. Bartlett. No.
The Clerk. Mr. Bartlett votes no.
Mr. Chabot?
Mr. Chabot. No.
The Clerk. Mr. Chabot votes no.
Mr. King?
Mr. King. No.
The Clerk. Mr. King votes no.
Mr. Coffman?
Mr. Coffman. No.
The Clerk. Mr. Coffman votes no.
Mr. Mulvaney?
[No response.]
The Clerk. Mr. Tipton?
Mr. Tipton. No.
The Clerk. Mr. Tipton votes no.
Mr. Landry?
Mr. Landry. No.
The Clerk. Mr. Landry votes no.
Ms. Herrera Beutler?
Mr. Herrera Beutler. No.
The Clerk. Ms. Herrera Beutler votes no.
Mr. West?
Mr. West. Yes.
The Clerk. Mr. West votes yes.
Mrs. Ellmers?
Mrs. Ellmers. No.
The Clerk. Mrs. Ellmers votes no.
Mr. Walsh?
Mr. Walsh. No.
The Clerk. Mr. Walsh votes no.
Mr. Hanna?
Mr. Hanna. No.
The Clerk. Mr. Hanna votes no.
Mr. Barletta?
Mr. Barletta. No.
The Clerk. Mr. Barletta votes no.
Ms. Velazquez?
Ms. Velazquez. Yes.
The Clerk. Ms. Velazquez votes yes.
Mr. Schrader?
Mr. Schrader. Yes.
The Clerk. Mr. Schrader votes yes.
Mr. Critz?
Mr. Critz. Yes.
The Clerk. Mr. Critz votes yes.
Mr. Altmire?
Mr. Altmire. Aye.
The Clerk. Mr. Altmire votes yes.
Ms. Clarke?
Ms. Clarke. Aye.
The Clerk. Ms. Clarke votes yes.
Ms. Chu?
Ms. Chu. Aye.
The Clerk. Ms. Chu votes yes.
Mr. Cicilline?
Mr. Cicilline. Aye.
The Clerk. Mr. Cicilline votes yes.
Mr. Richmond?
[No response.]
The Clerk. Mr. Peters?
Mr. Peters. Yes.
The Clerk. Mr. Peters votes yes.
Mr. Owens?
Mr. Owens. Aye.
The Clerk. Mr. Owens votes yes.
Mr. Keating?
[No response.]
Chairman Graves. Are there any other Members that wish to
vote?
Mr. Mulvaney?
Mr. Mulvaney. No.
The Clerk. Mr. Mulvaney votes no.
Chairman Graves. The clerk will report the vote.
The Clerk. Thirteen noes and ten ayes.
Chairman Graves. On this vote there were 10 yeas and 13
noes. The amendment is not agreed to.
The question now occurs on agreeing to the amendment
offered by Representative Velazquez, number 7. The clerk will
call the roll.
The Clerk. Mr. Graves?
Mr. Graves. No.
The Clerk. Mr. Graves votes no.
Mr. Bartlett?
Mr. Bartlett. No.
The Clerk. Mr. Bartlett votes no.
Mr. Chabot?
Mr. Chabot. No.
The Clerk. Mr. Chabot votes no.
Mr. King?
Mr. King. No.
The Clerk. Mr. King votes no.
Mr. Coffman?
Mr. Coffman. No.
The Clerk. Mr. Coffman votes no.
Mr. Mulvaney?
Mr. Mulvaney. No.
The Clerk. Mr. Mulvaney votes no.
Mr. Tipton?
Mr. Tipton. No.
The Clerk. Mr. Tipton votes no.
Mr. Landry?
Mr. Landry. No.
The Clerk. Mr. Landry votes no.
Ms. Herrera Beutler?
Ms. Herrera Beutler. No.
The Clerk. Ms. Herrera Beutler votes no.
Mr. West?
Mr. West. No.
The Clerk. Mr. West votes no.
Mrs. Ellmers?
Mrs. Ellmers. No.
The Clerk. Mrs. Ellmers votes no.
Mr. Walsh?
Mr. Walsh. No.
The Clerk. Mr. Walsh votes no.
Mr. Hanna?
Mr. Hanna. No.
The Clerk. Mr. Hanna votes no.
Mr. Barletta?
Mr. Barletta. No.
The Clerk. Mr. Barletta votes no.
Ms. Velazquez?
Ms. Velazquez. Aye.
The Clerk. Ms. Velazquez votes yes.
Mr. Schrader?
Mr. Schrader. Yes.
The Clerk. Mr. Schrader votes yes.
Mr. Critz?
Mr. Critz. Aye.
The Clerk. Mr. Critz votes yes.
Mr. Altmire?
Mr. Altmire. Aye.
The Clerk. Mr. Altmire votes yes.
Ms. Clarke?
Ms. Clarke. Aye.
The Clerk. Ms. Clarke votes yes.
Ms. Chu?
Ms. Chu. Aye.
The Clerk. Ms. Chu votes yes.
Mr. Cicilline?
Mr. Cicilline. Aye.
The Clerk. Mr. Cicilline votes yes.
Mr. Richmond?
[No response.]
The Clerk. Mr. Peters?
Mr. Peters. Aye.
The Clerk. Mr. Peters votes yes.
Mr. Owens?
Mr. Owens. Aye.
The Clerk. Mr. Owens votes yes.
Mr. Keating?
[No response.]
Chairman Graves. Are there any other Members who wish to
vote?
The clerk shall report the vote.
The Clerk. Nine yeses, fourteen noes.
Chairman Graves. On this vote, there were 9 yeas, 14 noes.
The amendment is not agreed to.
The question now occurs on agreeing to the amendment
offered by Representative Velazquez, number 4, which would be
Velazquez amendment number 4. The clerk shall call the roll.
The Clerk. Mr. Graves?
Mr. Graves. No.
The Clerk. Mr. Graves votes no.
Mr. Bartlett?
Mr. Bartlett. No.
The Clerk. Mr. Bartlett votes no.
Mr. Chabot?
Mr. Chabot. No.
The Clerk. Mr. Chabot votes no.
Mr. King?
Mr. King. No.
The Clerk. Mr. King votes no.
Mr. Coffman?
Mr. Coffman. No.
The Clerk. Mr. Coffman votes no.
Mr. Mulvaney?
Mr. Mulvaney. No.
The Clerk. Mr. Mulvaney votes no.
Mr. Tipton?
Mr. Tipton. No.
The Clerk. Mr. Tipton votes no.
Mr. Landry?
Mr. Landry. No.
The Clerk. Mr. Landry votes no.
Ms. Herrera Beutler?
Ms. Herrera Beutler. No.
The Clerk. Ms. Herrera Beutler votes no.
Mr. West?
Mr. West. Yes.
The Clerk. Mr. West votes yes.
Mrs. Ellmers?
Mrs. Ellmers. No.
The Clerk. Mrs. Ellmers votes no.
Mr. Walsh?
Mr. Walsh. No.
The Clerk. Mr. Walsh votes no.
Mr. Hanna?
Mr. Hanna. No.
The Clerk. Mr. Hanna votes no.
Mr. Barletta?
Mr. Barletta. No.
The Clerk. Mr. Barletta votes no.
Ms. Velazquez?
Ms. Velazquez. Yes.
The Clerk. Ms. Velazquez votes yes.
Mr. Schrader?
Mr. Schrader. Yes.
The Clerk. Mr. Schrader votes yes.
Mr. Critz?
Mr. Critz. Aye.
The Clerk. Mr. Critz votes yes.
Mr. Altmire?
Mr. Altmire. Aye.
The Clerk. Mr. Altmire votes yes.
Ms. Clarke?
Ms. Clarke. Aye.
The Clerk. Ms. Clarke votes yes.
Ms. Chu?
Ms. Chu. Aye.
The Clerk. Ms. Chu votes yes.
Mr. Cicilline?
Mr. Cicilline. Aye.
The Clerk. Mr. Cicilline votes yes.
Mr. Richmond?
[No response.]
The Clerk. Mr. Peters?
Mr. Peters. Aye.
The Clerk. Mr. Peters votes yes.
Mr. Owens?
Mr. Owens. Aye.
The Clerk. Mr. Owens votes yes.
Mr. Keating?
[No response.]
Chairman Graves. Do any other Members wish to vote?
Seeing none, the clerk shall report the vote.
The Clerk. Ten ayes, thirteen noes.
Chairman Graves. On this vote there were 10 yeas, 13 noes.
The amendment is not agreed to.
The question now occurs on the amendment offered by
Representative Velazquez in which a recorded vote was ordered.
This is Velazquez number 5. The clerk shall call the roll.
The Clerk. Mr. Graves?
Mr. Graves. No.
The Clerk. Mr. Graves votes no.
Mr. Bartlett?
Mr. Bartlett. No.
The Clerk. Mr. Bartlett votes no.
Mr. Chabot?
Mr. Chabot. No.
The Clerk. Mr. Chabot votes no.
Mr. King?
Mr. King. No.
The Clerk. Mr. King votes no.
Mr. Coffman?
Mr. Coffman. No.
The Clerk. Mr. Coffman votes no.
Mr. Mulvaney?
Mr. Mulvaney. No.
The Clerk. Mr. Mulvaney votes no.
Mr. Tipton?
Mr. Tipton. No.
The Clerk. Mr. Tipton votes no.
Mr. Landry?
Mr. Landry. No.
The Clerk. Mr. Landry votes no.
Ms. Herrera Beutler?
Ms. Herrera Beutler. No.
The Clerk. Ms. Herrera Beutler votes no.
Mr. West?
Mr. West. No.
The Clerk. Mr. West votes no.
Mrs. Ellmers?
Mrs. Ellmers. No.
The Clerk. Mrs. Ellmers votes no.
Mr. Walsh?
Mr. Walsh. No.
The Clerk. Mr. Walsh votes no.
Mr. Hanna?
Mr. Hanna. No.
The Clerk. Mr. Hanna votes no.
Mr. Barletta?
Mr. Barletta. No.
The Clerk. Mr. Barletta votes no.
Ms. Velazquez?
Ms. Velazquez. Aye.
The Clerk. Ms. Velazquez votes yes.
Mr. Schrader?
Mr. Schrader. Yes.
The Clerk. Mr. Schrader votes yes.
Mr. Critz?
Mr. Critz. Aye.
The Clerk. Mr. Critz votes yes.
Mr. Altmire?
Mr. Altmire. Aye.
The Clerk. Mr. Altmire votes yes.
Ms. Clarke?
Ms. Clarke. Aye.
The Clerk. Ms. Clarke votes yes.
Ms. Chu?
Ms. Chu. Aye.
The Clerk. Ms. Chu votes yes.
Mr. Cicilline?
Mr. Cicilline. Aye.
The Clerk. Mr. Cicilline votes yes.
Mr. Richmond?
[No response.]
The Clerk. Mr. Peters?
Mr. Peters. Aye.
The Clerk. Mr. Peters votes yes.
Mr. Owens?
Mr. Owens. Aye.
The Clerk. Mr. Owens votes yes.
Mr. Keating?
[No response.]
Chairman Graves. Are there any other Members wishing to
vote?
Seeing none, the clerk shall report the vote.
The Clerk. Nine ayes, fourteen noes.
Chairman Graves. On this vote, there were 9 yeas, 14 noes.
The amendment is not agreed to.
Are there any other Members wishing to offer an amendment?
Seeing none, the question is on agreeing to H.R. 527, as
amended. All those in favor, say aye.
All those opposed, no.
In the opinion of the chair, the ayes have it. The bill is
favorably reported to the House.
Chairman Graves. Next order of business is H.R. 585, the
Small Business Size Standard Act of 2011. The purpose of this
bill is to ensure that Federal agencies have a consistent
determination concerning the use of non-SBA size standards in
the regulatory programs.
Under the RFA, an agency can consult with the Office of
Advocacy and utilize a different definition of a small business
than the one adopted by the SBA when it prepares an initial
regulatory flexibility analysis. If the agency then uses that
definition to develop the regulation that reduces reporting
burdens on small businesses, it would have to get the approval
of the Administrator of the SBA under the Small Business Act.
The Administrator might reject the request. Thus, an agency
seeking to help small businesses create jobs by reducing
paperwork might find assistance from the Office of Advocacy,
but be frustrated by a different decision from the
Administrator. H.R. 585 simply ensures that such a result could
not happen.
Nothing in the bill transfers to the Office of Advocacy the
authority to make small business size determinations for
eligibility of assistance under the Small Business Act or the
Small Business Investment Act.
So with that I now recognize Ranking Member Velazquez for
her remarks on H.R. 585.
Ms. Velazquez. Thank you, Mr. Chairman.
Size standards are a highly technical, but absolutely
critical component of our Committee's work. After all, they are
what legally determine whether a company is, in fact, a small
business. Because of this we are able to effectively channel
resources to these entrepreneurs so they are better able to
succeed in creating jobs.
Historically the SBA's Office of Size Standards has been
responsible for this area. It establishes and reviews standards
across a wide range of industries. In some instances this
office approves the small business size standard used by other
agencies when implementing certain statutes. Aside from the
Small Business Act and the Small Business Investment Act, this
makes sense, because the SBA has the experience and resources
necessary to determine this matter governmentwide. The
legislation before us, H.R. 585, changes this. While the SBA
will continue to approve size standards for its enabling
statutes, it will no longer do so for all the statutes.
The result of approving this legislation will be to create
a duplicative size standard authority in both the SBA and the
Office of Advocacy. Such a move is curious given that the
Committee spent so much time discussing the need to reduce
bureaucratic duplication. In fact, there is an entire section
entitled ``Government Waste and Duplication in SBA Programs''
in the Committee's budget views.
Such duplication is always concerning, but particularly so
when the country is faced with staggering debt. This
legislation will add to this debt by requiring the Office of
Advocacy to hire new personnel and conduct analysis identical
to those already in existence in the SBA's Office of Size
Standards. Common sense tells you that creating such similar
entities is just plain unnecessary and simply not a good use of
taxpayers' money. For this reason, your own witness, the Chief
Counsel of Advocacy under President Ronald Reagan, testified
just last month before this Committee that advocacy should not
take on the new responsibilities outlined in H.R. 585.
The mission of the Office of Advocacy is to be a champion
for our Nation's small businesses, not to determine size
standards. The SBA already does this. We need to make sure that
advocacy remains true to this goal and continues to be a tool
to limit waste, rather than becoming a source of it.
With that, Mr. Chairman, I yield back.
Chairman Graves. Any other Members that wish to be
recognized for a statement on H.R. 585?
Seeing none, the Committee now moves for consideration of
H.R. 585. The clerk will please report the title of the bill.
The Clerk. H.R. 585, To amend the Small Business Act to
provide for the establishment and approval of small business
concern size standards by the Chief Counsel for Advocacy of the
Small Business Administration.
Chairman Graves. I ask unanimous consent that H.R. 585 be
considered as read and open for amendment in its entirety.
Does any Member seek recognition for the purpose of
offering an amendment?
Ms. Velazquez. Yes, Mr. Chairman. I have an amendment at
the desk.
Chairman Graves. Clerk, please report the amendment.
The Clerk. Add, at the end of the bill, the following.
Ms. Velazquez. I ask unanimous consent that my amendment be
considered as read.
Chairman Graves. Seeing no objection, so moved.
Ms. Velazquez. Thank you, Mr. Chairman.
Mr. Chairman, ensuring that agencies are operated in an
efficient manner has never been more important. This means that
efforts must be made to limit programs that duplicate each
other. Such duplication is unnecessary at any time, but
certainly so when our Federal debt is now exceeding $14
trillion.
Unfortunately, the underlying bill is an attempt to solve a
bureaucratic coordination problem which creates a duplication
of resources within the SBA. To approve a size standard
requires expertise and analytical resources which the Office of
Advocacy will have to acquire. This will duplicate similar
resources maintained by the SBA in its Office of Size
Standards. In this regard, H.R. 585 raises a red flag.
To address this problem my amendment will require the
Office of Advocacy to report to Congress on the feasibility,
personnel, resources required and overall cost to carry out
this legislation. It will also require to assess whether the
legislation will result in a duplication of functions. To make
sure that costs are controlled, it will then require the Chief
Counsel to certify that H.R. 585 will not result in any
additional costs.
This amendment does not require any elaborate study, nor
does it prohibit H.R. 585 from being implemented, but given the
fact that we never heard from the Office of Advocacy, it just
asks before it is implemented that we know how much the
legislation will cost if it is able to do so, and whether they
believe it will result in duplication. If the Chief Counsel
simply reports and certifies to Congress on this, then H.R. 585
can be implemented.
At a minimum this will provide the Committee with essential
information regarding this new law and permit for productive
oversight to occur. It also provides taxpayers with greater
transparency. Such an effort is in line with the Committee's
oversight plan, which goes to great lengths to limit
duplication within the SBA. For this reason, I urge my
colleagues to support and vote yes on this amendment, which is
a vote for transparency and reducing waste and duplication in
the SBA.
With that I yield back, Mr. Chairman.
Chairman Graves. Any other Members that wish to be heard on
the amendment?
Seeing none, as I explained earlier, this simply transfers
a function currently performed by the Administrator to the
Office of Chief Counsel of Advocacy. There isn't going to be
any duplication that occurs. The bill just ensures that an
agency does not go through the pointless exercise of having a
size standard approved under the RFA, and then when it is time
to put it into place, put the regulation into place, have it
rejected by the SBA. And I don't believe there will be any
additional costs because the costs associated with this
transfer, you know, it is going to be done--the analysis is
going to be done by one agency or the other. So I don't believe
there is going to be any additional costs.
Ms. Velazquez. Mr. Chairman?
Chairman Graves. Yes.
Ms. Velazquez. On top of the 52 agencies that we are adding
to the Office of Advocacy, we are going to add this new
responsibility, and you mean to say it is not going to cost
anything?
Chairman Graves. Well, no, because we are transferring that
responsibility from one office to the next. We are not asking
another office to do it all over again.
So with that, the question is on the amendment by
Representative Velazquez. All those in favor, say aye.
All those opposed, no.
The noes appear to have it.
Ms. Velazquez. I ask for a recorded vote.
Chairman Graves. A recorded vote has been requested. Clerk,
please call the roll.
The Clerk. Mr. Graves?
Mr. Graves. No.
The Clerk. Mr. Graves votes no.
Mr. Bartlett?
Mr. Bartlett. No.
The Clerk. Mr. Bartlett votes no.
Mr. Chabot?
Mr. Chabot. No.
The Clerk. Mr. Chabot votes no.
Mr. King?
Mr. King. No.
The Clerk. Mr. King votes no.
Mr. Coffman?
Mr. Coffman. No.
The Clerk. Mr. Coffman votes no.
Mr. Mulvaney?
Mr. Mulvaney. No.
The Clerk. Mr. Mulvaney votes no.
Mr. Tipton?
Mr. Tipton. No.
The Clerk. Mr. Tipton votes no.
Mr. Landry?
Mr. Landry. No.
The Clerk. Mr. Landry votes no.
Ms. Herrera Beutler?
Ms. Herrera Beutler. Yes.
The Clerk. Ms. Herrera Beutler votes yes.
Mr. West?
Mr. West. Yes.
The Clerk. Mr. West votes yes.
Mrs. Ellmers?
Mrs. Ellmers. No.
The Clerk. Mrs. Ellmers votes no.
Mr. Walsh?
Mr. Walsh. No.
The Clerk. Mr. Walsh votes no.
Mr. Hanna?
Mr. Hanna. No.
The Clerk. Mr. Hanna votes no.
Mr. Barletta?
Mr. Barletta. No.
The Clerk. Mr. Barletta votes no.
Ms. Velazquez?
Ms. Velazquez. Aye.
The Clerk. Ms. Velazquez votes yes.
Mr. Schrader?
Mr. Schrader. Yes.
The Clerk. Mr. Schrader votes yes.
Mr. Critz?
Mr. Critz. Aye.
The Clerk. Mr. Critz votes yes.
Mr. Altmire?
Mr. Altmire. Aye.
The Clerk. Mr. Altmire votes yes.
Ms. Clarke?
Ms. Clarke. Aye.
The Clerk. Ms. Clarke votes yes.
Ms. Chu?
[No response.]
The Clerk. Mr. Cicilline?
Mr. Cicilline. Aye.
The Clerk. Mr. Cicilline votes yes.
Mr. Richmond?
[No response.]
The Clerk. Mr. Peters?
Mr. Peters. Aye.
The Clerk. Mr. Peters votes yes.
Mr. Owens?
Mr. Owens. Aye.
The Clerk. Mr. Owens votes yes.
Mr. Keating?
Mr. Keating. Yes.
The Clerk. Mr. Keating votes yes.
Chairman Graves. Are there any other Members that wish to
be recorded?
Seeing none, clerk, please report the vote.
The Clerk. Eleven ayes, twelve noes.
Chairman Graves. Last vote there were 11 ayes, 12 noes. The
amendment is not agreed to.
Are there any other Members that wish to offer amendments?
Mr. Schrader. Mr. Chair, could I move to strike the last
word briefly?
Chairman Graves. Absolutely.
Mr. Schrader. Just a concern on the bill itself. While I
know it is well intentioned, and I appreciate the chair's
efforts to entertain the discussion, particularly the ranking
member, it just seems pretty duplicative to me. I don't see why
we have two different outfits promulgating rules and size
standards. I think it is going to be very, very confusing to
small businesses at the end of the day. And, you know, one of
our goals of our Committee is to try and eliminate some of the
duplication and eliminate some of the confusion the small
businesses face trying to figure out if they fit into this
program or that program. So with that, I am probably going to
be voting no, sir.
Chairman Graves. All right. I appreciate that. Again, we
are transferring the authority. We are not duplicating it.
With that, if there are no other amendments, the question
is on agreeing to H.R. 585. All those in favor, say aye.
All those opposed, no.
In the opinion of the chair, the ayes have it.
Ms. Velazquez. I ask for a recorded vote.
Chairman Graves. A recorded vote has been requested. Clerk,
please call the roll.
The Clerk. Mr. Graves?
Mr. Graves. Aye.
The Clerk. Mr. Graves votes yes.
Mr. Bartlett?
Mr. Bartlett. Aye.
The Clerk. Mr. Bartlett votes yes.
Mr. Chabot?
Mr. Chabot. Aye.
The Clerk. Mr. Chabot votes yes.
Mr. King?
Mr. King. Aye.
The Clerk. Mr. King votes yes.
Mr. Coffman?
Mr. Coffman. Aye.
The Clerk. Mr. Coffman votes yes.
Mr. Mulvaney?
Mr. Mulvaney. Aye.
The Clerk. Mr. Mulvaney votes yes.
Mr. Tipton?
Mr. Tipton. Aye.
The Clerk. Mr. Tipton votes yes.
Mr. Landry?
Mr. Landry. Aye.
The Clerk. Mr. Landry votes yes.
Ms. Herrera Beutler?
Chairman Graves. Was that an aye?
Ms. Velazquez. You understand it is going to increase the
debt.
The Clerk. Ms. Herrera Beutler?
Ms. Herrera Beutler. Yes.
The Clerk. Ms. Herrera Beutler votes yes.
Mr. West?
[No response.]
The Clerk. Mrs. Ellmers?
Mrs. Ellmers. Yes.
The Clerk. Mrs. Ellmers votes yes.
Mr. Walsh?
Mr. Walsh. Yes.
The Clerk. Mr. Walsh votes yes.
Mr. Hanna?
Mr. Hanna. Yes.
The Clerk. Mr. Hanna votes yes.
Mr. Barletta?
Mr. Barletta. Yes.
The Clerk. Mr. Barletta votes yes.
Ms. Velazquez?
Ms. Velazquez. No.
The Clerk. Ms. Velazquez votes no.
Mr. Schrader?
Mr. Schrader. No.
The Clerk. Mr. Schrader votes no.
Mr. Critz?
Mr. Critz. No.
The Clerk. Mr. Critz votes no.
Mr. Altmire?
[No response.]
The Clerk. Ms. Clarke?
Ms. Clarke. No.
The Clerk. Ms. Clarke votes no.
Ms. Chu?
[No response.]
The Clerk. Mr. Cicilline?
Mr. Cicilline. No.
The Clerk. Mr. Cicilline votes no.
Mr. Richmond?
[No response.]
The Clerk. Mr. Peters?
Mr. Peters. No.
The Clerk. Mr. Peters votes no.
Mr. Owens?
Mr. Owens. No.
The Clerk. Mr. Owens votes no.
Mr. Keating?
Mr. Keating. No.
The Clerk. Mr. Keating votes no.
Chairman Graves. Are there any other Members that wish to
be recorded?
Seeing none, the clerk please report the vote.
The Clerk. Thirteen ayes, eight noes.
Chairman Graves. By a vote of 13 yeas, 8 noes, the bill is
favorably reported to the House.
I would ask unanimous consent that the staff be authorized
to make any technical and conforming changes and take all
necessary actions to report the bill to the House.
Ms. Velazquez. Mr. Chairman, I just would like for the
Committee to be able to notice that we are going to be filing
our own views on both bills.
Chairman Graves. So noted.
With that, the hearing is adjourned. Thanks, everybody.
[Whereupon, at 4:04 p.m., the Committee was adjourned.]

Amendment to H.R. 527

Offered by Mr. Owens of New York

Add at the end of the bill the following:

SEC. 10. AGENCY PREPARATION OF GUIDES.

Section 212(a)(5) the Small Business Regulatory Enforcement
Fairness Act of 1996 (5 U.S.C. 601 note) is amended to read as
follows:
``(5) Agency preparation of guides.--The agency
shall, in its sole discretion, taking into account the
subject matter of the rule and the language of relevant
statutes, ensure that the guide is written using
sufficiently plain language likely to be understood by
affected small entities. Agencies may prepare separate
guides covering groups or classes of similarly affected
small entities and may cooperate with associations of
small entities to distribute such guides. In developing
guides, agencies shall solicit input from affected
small entities or associations of affected small
entities. An agency may prepare guides and apply this
section with respect to a rule or a group of related
rules.''.

Amendment to H.R. 527

Offered by Mr. Schrader of Oregon

Page 9, insert after line 15 the following (and redesignate
succeeding sections accordingly):

SEC. 3. EXPANSION OF REPORT OF REGULATORY AGENDA.

Section 602 of title 5, United States Code, is amended----
(1) in subsection (a)----
(A) in paragraph (2), by striking ``and'' at
the end;
(B) by redesignating paragraph (3) as
paragraph (4); and
(C) by inserting after paragraph (2) the
following:
``(3) a brief description of the sector of the North
American Industrial Classification System that is
primarily affected by any rule which the agency expects
to propose or promulgate which is likely to have a
significant economic impact on a substantial number of
small entities; and''.
(2) in subsection (c), to read as follows:
``(c) Each agency shall prominently display a plain language
summary of the information contained in the regulatory
flexibility agenda published under subsection (a) on its
website within 3 days of its publication in the Federal
Register. The Office of Advocacy of the Small Business
Administration shall compile and prominently display a plain
language summary of the regulatory agendas referenced in
subsection (a) for each agency on its website within 3 days of
their publication in the Federal Register.''.

Amendment to H.R. 527

Offered by Mr. Owens of New York

Page 20, insert after line 5 the following (and redesignate
succeeding sections accordingly):

``(c) The plan shall include a section that details how an
agency will conduct outreach to and meaningfully include small
businesses for the purposes of carrying out this section. The
agency shall include in this section a plan for how the agency
will contact small businesses and gather their input on
existing agency rules''.

Amendment to H.R. 527

Offered by Ms. Velazquez of New York

Page 3, line 12, insert before the period at the end the
following:
The amendment made by this subsection shall not apply to a rule
making by the Administrator of the Small Business
Administration regarding the contracting, lending, investment,
or entrepreneurial development programs of the Administrator
Page 13, insert after line 6 the following:
(f) Application to Certain Rules.--This section and the
amendments made by this section shall not apply to a rule
making by the Administrator of the Small Business
Administration regarding the contracting, lending, investment,
or entrepreneurial development programs of the Administrator.

Page 15, insert after line 3 the following:
(c) Application to Certain Rules.--This section and the
amendments made by this section shall not apply to a rule
making by the Administrator of the Small Business
Administration regarding the contracting, lending, investment,
or entrepreneurial development programs of the Administrator.

Page 18, line 17, insert before the period at the end the
following:
The amendment made by this section shall not apply to a rule
making by the Administrator of the Small Business
Administration regarding the contracting, lending, investment,
or entrepreneurial development programs of the Administrator

Amendment to H.R. 527

Offered by Ms. Velazquez of New York

Page 17, line 12, insert after ``entities.'' the following:
``Such report shall also include a total cost of conducting the
panel described in subsection (c)(2) as well as a detailed
report of the components of that total cost, including expenses
of officers and employees of the Federal government (at rates
authorized for such officers and employees under subchapter I
of chapter 57 of title 5, United States Code) who participate
in the panel and the rate of salary or basic pay of each
officer or employee of the Federal government who participates
in the panel, prorated to account for time of service on the
panel.''

Page 17, insert after line 12 the following (and redesignate
succeeding paragraphs accordingly):
``(3) Not later than 60 days after the end of a
fiscal year, the Chief Counsel shall submit a
consolidated report detailing the total cost of all
panels conducted pursuant to subsection (c)(2) in that
fiscal year. This report shall include a detailed
description of the components of the total cost,
including expenses of officers and employees of the
Federal government (at rates authorized for such
officers and employees under subchapter I of chapter 57
of title 5, United States Code) who participate in the
panel and the rate of salary or basic pay of each
officer or employee of the Federal government who
participates in the panel, prorated to account for time
of service on the panel.''.

Amendment to H.R. 527

Offered by Ms. Velazquez of New York

Strike all after the enacting clause and insert the
following:

SECTION 1. SHORT TITLE.

This Act may be cited as the ``Small Business Regulatory
Improvement Act of 2011''.

SEC. 2. FINDINGS.

Congress finds the following:
(1) Small businesses are frequently the source of new
products, methods, and innovations.
(2) A vibrant and growing small business sector is
critical to creating jobs in a dynamic economy.
(3) Regulations designed for application to large-
scale entities have been applied uniformly to small
businesses and other small entities.
(4) Uniform Federal regulatory and reporting
requirements in many instances have imposed on small
businesses and other small entities disproportionately
burdensome demands, including legal, accounting, and
consulting costs.
(5) Since 1980, Federal agencies have been required
to recognize and take account of the differences in the
scale and resources of regulated entities but have
failed to do so.
(6) Alternative regulatory approaches that do not
conflict with the stated objectives of the statutes the
regulations seek to implement may be available and may
minimize the significant economic impact of regulations
on small businesses and other small entities.
(7) Federal agencies have failed to analyze and
uncover less costly alternative regulatory approaches,
despite the fact that the chapter 6 of title 5, United
States Code (commonly known as the Regulatory
Flexibility Act), requires them to do so.
(8) Federal agencies continue to interpret chapter 6
of title 5, United States Code, in a manner that
permits them to avoid their analytical
responsibilities.
(9) Significant changes are needed in the methods by
which Federal agencies develop and analyze regulations,
receive input from affected entities, and develop
regulatory alternatives that will lessen the burden or
maximize the benefits of final rules to small
businesses and other small entities.
(10) It is the intention of the Congress to amend
chapter 6 of title 5, United States Code, to ensure
that all impacts, including foreseeable indirect
effects, of proposed and final rules are considered by
agencies during the rulemaking process and that the
agencies assess a full range of alternatives that will
limit adverse economic consequences or enhance economic
benefits.
(11) Federal agencies should be capable of assessing
the impact of proposed and final rules without delaying
the regulatory process or impinging on the ability of
Federal agencies to fulfill their statutory mandates.

SEC. 3. CLARIFICATION AND EXPANSION OF RULES COVERED BY THE REGULATORY
FLEXIBILITY ACT.

Section 601 of title 5, United States Code, is amended by
adding at the end the following new paragraph:
``(9) Economic impact.--The term `economic impact'
means, with respect to a proposed or final rule--
``(A) any direct economic effect on small
entities of such rule; and
``(B) any indirect economic effect on small
entities which is reasonably foreseeable and
results from such rule (without regard to
whether small entities will be directly
regulated by the rule).''.

SEC. 4. REQUIREMENTS PROVIDING FOR MORE DETAILED ANALYSES.

(a) Initial Regulatory Flexibility Analysis.--Subsection (b)
of section 603 of title 5, United States Code, is amended to
read as follows:
``(b) Each initial regulatory flexibility analysis required
under this section shall contain a detailed statement
describing--
``(1) the reasons why the action by the agency is
being considered;
``(2) the objectives of, and legal basis for, the
proposed rule;
``(3) the type of small entities to which the
proposed rule will apply;
``(4) the number of small entities to which the
proposed rule will apply or why such estimate is not
available;
``(5) the projected reporting, recordkeeping, and
other compliance requirements of the proposed rule,
including an estimate of the classes of small entities
which will be subject to the requirement, the costs,
and the type of professional skills necessary to comply
with the rule; and
``(6) all relevant Federal rules which may duplicate,
overlap, or conflict with the proposed rule, or the
reasons why such a description could not be
provided.''.
(b) Final Regulatory Flexibility Analysis.--
(1) Paragraph (4) of such section is amended by
striking ``an explanation'' and inserting ``a detailed
explanation''.
(2) Paragraph (5) of such section is amended to read
as follows:
``(4) a description of the projected reporting,
recordkeeping, and other compliance requirements of the
rule, including an estimate of the classes of small
entities which will be subject to the requirement, the
costs, and the type of professional skills necessary to
comply with the rule; and''.
(c) Certification of No Impact.--Subsection (b) of section
605 of title 5, United States Code, is amended by inserting
``detailed'' before ``statement'' both places such term
appears.

SEC. 5. PERIODIC REVIEW OF RULES.

Section 610 of title 5, United States Code, is amended to
read as follows:

``Sec. 610. Periodic review of rules

``(a) Not later than 180 days after the enactment of the
Small Business Regulatory Improvement Act of 2011, each agency
shall publish in the Federal Register and place on its website
a plan for the periodic review of rules issued by the agency
which the head of the agency determines have a significant
economic impact on a substantial number of small entities. Such
determination shall be made without regard to whether the
agency performed an analysis under section 604. The purpose of
the review shall be to determine whether such rules should be
continued without change, or should be amended or rescinded,
consistent with the stated objectives of applicable statutes,
to minimize significant economic impacts on a substantial
number of small entities. Such plan may be amended by the
agency at any time by publishing the revision in the Federal
Register and subsequently placing the amended plan on the
agency's website.
``(b) The plan shall provide for the review of all such
agency rules existing on the date of the enactment of the Small
Business Regulatory Improvement Act of 2011 within 10 years of
the date of publication of the plan in the Federal Register and
for review of rules adopted after the date of enactment of the
Small Business Regulatory Improvement Act of 2011 within 10
years after the publication of the final rule in the Federal
Register. If the head of the agency determines that completion
of the review of existing rules is not feasible by the
established date, the head of the agency shall so certify in a
statement published in the Federal Register and may extend the
review for not longer than 2 years after publication of notice
of extension in the Federal Register. Such certification and
notice shall be sent to the Chief Counsel for Advocacy and the
Congress.
``(c) Each agency shall annually submit a report regarding
the results of its review pursuant to such plan to the Congress
and, in the case of agencies other than independent regulatory
agencies (as defined in section 3502(5) of title 44, United
States Code) to the Administrator of the Office of Information
and Regulatory Affairs of the Office of Management and Budget.
Such report shall include the identification of any rule with
respect to which the head of the agency made a determination
described in paragraph (5) or (6) of subsection (d) and a
detailed explanation of the reasons for such determination.
``(d) In reviewing rules under such plan, the agency shall
consider the following factors:
``(1) The continued need for the rule.
``(2) The nature of complaints received by the agency
from small entities concerning the rule.
``(3) Comments by the Regulatory Enforcement
Ombudsman and the Chief Counsel for Advocacy.
``(4) The complexity of the rule.
``(5) The extent to which the rule overlaps,
duplicates, or conflicts with other Federal rules and,
unless the head of the agency determines it to be
infeasible, State and local rules.
``(6) The length of time since the rule has been
evaluated or the degree to which technology, economic
conditions, or other factors have changed in the area
affected by the rule.
``(e) The agency shall publish in the Federal Register and on
its website a list of rules to be reviewed pursuant to such
plan. Such publication shall include a brief description of the
rule, the reason why the agency determined that it has a
significant economic impact on a substantial number of small
entities (without regard to whether it had prepared a final
regulatory flexibility analysis for the rule), and request
comments from the public, the Chief Counsel for Advocacy, and
the Regulatory Enforcement Ombudsman concerning the enforcement
of the rule.''.

SEC. 6. CHANGES TO THE REGULATORY FLEXIBILITY ACT TO COMPORT WITH
EXECUTIVE ORDER 13272.

(a) Initial Regulatory Flexibility Analysis.--Section 603 of
title 5, United States Code, is amended by adding at the end
the following:
``(e) An agency shall notify the Chief Counsel for Advocacy
of the Small Business Administration of any draft rules that
may have a significant economic impact on a substantial number
of small entities either--
``(1) when the agency submits a draft rule to the
Office of Information and Regulatory Affairs at the
Office of Management and Budget, if submission is
required; or
``(2) if no submission to the Office of Information
and Regulatory Affairs is so required, at a reasonable
time prior to publication of the rule by the agency.''.
(b) Inclusion in Final Regulatory Flexibility Analysis of
Response to Comments on Certification of Proposed Rule.--
Paragraph (2) of section 604(a) of title 5, United States Code,
is amended by inserting after ``initial regulatory flexibility
analysis'' the following: ``(or certification of the proposed
rule under section 605(b))''.

Amendment to H.R. 527

Offered by Ms. Velazquez of New York

Add, at the end of the bill, the following:

SEC. 10. EFFECTIVE DATE.

This Act and the amendments made by this Act shall take
effect on October 1 of the first full fiscal year--
(1) for which no funding is authorized by law for the
Office of Advocacy of the Small Business Administration
in an amount exceeding the level of funding for the
Office for fiscal year 2011; and
(2) that follows any fiscal year for which the actual
annual Federal budget deficit did not exceed
$500,000,000,000.

Amendment to H.R. 585

Offered by Ms. Velazquez of New York

Add, at the end of the bill, the following:

SEC. 3. EFFECTIVE DATE; STUDY AND CERTIFICATION REQUIRED REGARDING
COST, RESOURCE DUPLICATION AND AGENCY WASTE.

This Act and the amendments made by this Act shall not take
effect until the date that the Chief Counsel for Advocacy of
the Small Business Administration--
(1) reports to the Committee on Small Business of the
House of Representatives and the Committee on Small
Business and Entrepreneurship of the Senate on the
feasibility, personnel resources required, and overall
cost to the Chief Counsel of carrying out the
responsibilities of the Chief Counsel under the
amendments made in section 2, including an analysis of
whether carrying out such responsibilities will result
in a duplication of functions in the Small Business
Administration, including those of the Office of Size
Standards; and
(2) certifies to the Committee on Small Business of
the House of Representatives and the Committee on Small
Business and Entrepreneurship of the Senate that the
Chief Counsel may carry out the responsibilities of the
Chief Counsel under the amendments made in section 2
without incurring any additional costs.

Amendment to H.R. 527

Offered by Mr. Critz of Pennsylvania

Page 18, insert after line 11 the following (and redesignate
succeeding subsections accordingly):

``(f)(1) If Congress approves a trade agreement under section
2191 of title 19, United States Code, then the Chief Counsel
for Advocacy of the Small Business Administration shall--
``(A) identify small entities or representatives of
small entities or a combination of both for the purpose
of obtaining advice, input, and recommendations from
those persons about the potential economic impacts of
rules implementing or pertaining to such trade
agreement; and
``(B) convene a review panel consisting of an
employee from the Office of Advocacy of the Small
Business Administration, an employee from relevant
agencies or, if appropriate, an employee from the
Office of Information and Regulatory Affairs of the
Office of Management and Budget to review the advice,
input, and recommendations provided to the Chief
Counsel under subparagraph (A).
``(2) Not later than 60 days after the review panel described
in paragraph (1) is convened, the Chief Counsel for Advocacy of
the Small Business Administration shall, after consultation
with the members of such panel, submit a report to Congress.
Such report shall include an assessment of the economic impact
of rules implementing or pertaining to the trade agreement on
small entities and a discussion of any alternatives that will
minimize adverse significant economic impacts or maximize
beneficial significant economic impacts on small entities.''.

Amendment to H.R. 527

Offered by Mr. Critz of Pennsylvania

Page 17, line 9, insert after ``small entities'' the
following: ``, including an assessment of the proposed rule's
impact on the cost that small entities pay for energy,''.

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H.R. 527

Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

(a) Short Title.--This Act may be cited as the ``Regulatory
Flexibility Improvements Act of 2011''.
(b) Table of Contents.--The table of contents of this Act is
as follows:

Sec. 1. Short title; table of contents.
Sec. 2. Clarification and expansion of rules covered by the Regulatory
Flexibility Act.
Sec. 3. Requirements providing for more detailed analyses.
Sec. 4. Repeal of waiver and delay authority; additional powers of the
Chief Counsel for Advocacy.
Sec. 5. Procedures for gathering comments.
Sec. 6. Periodic review of rules.
Sec. 7. Judicial review of compliance with the requirements of the
Regulatory Flexibility Act available after publication of the
final rule.
Sec. 8. Jurisdiction of court of appeals over rules implementing the
Regulatory Flexibility Act.
Sec. 9. Clerical amendments.

SEC. 2. CLARIFICATION AND EXPANSION OF RULES COVERED BY THE REGULATORY
FLEXIBILITY ACT.

(a) In General.--Paragraph (2) of section 601 of title 5,
United States Code, is amended to read as follows:
``(2) Rule.--The term `rule' has the meaning given
such term in section 551(4) of this title, except that
such term does not include a rule of particular (and
not general) applicability relating to rates, wages,
corporate or financial structures or reorganizations
thereof, prices, facilities, appliances, services, or
allowances therefor or to valuations, costs or
accounting, or practices relating to such rates, wages,
structures, prices, appliances, services, or
allowances.''.
(b) Inclusion of Rules With Indirect Effects.--Section 601 of
title 5, United States Code, is amended by adding at the end
the following new paragraph:
``(9) Economic impact.--The term `economic impact'
means, with respect to a proposed or final rule--
``(A) any direct economic effect on small
entities of such rule; and
``(B) any indirect economic effect on small
entities which is reasonably foreseeable and
results from such rule (without regard to
whether small entities will be directly
regulated by the rule).''.
(c) Inclusion of Rules With Beneficial Effects.--
(1) Initial regulatory flexibility analysis.--
Subsection (c) of section 603 of title 5, United States
Code, is amended by striking the first sentence and
inserting ``Each initial regulatory flexibility
analysis shall also contain a detailed description of
alternatives to the proposed rule which minimize any
adverse significant economic impact or maximize any
beneficial significant economic impact on small
entities.''.
(2) Final regulatory flexibility analysis.--The first
paragraph (6) of section 604(a) of title 5, United
States Code, is amended by striking ``minimize the
significant economic impact'' and inserting ``minimize
the adverse significant economic impact or maximize the
beneficial significant economic impact''.
(d) Inclusion of Rules Affecting Tribal Organizations.--
Paragraph (5) of section 601 of title 5, United States Code, is
amended by inserting ``and tribal organizations (as defined in
section 4(l) of the Indian Self-Determination and Education
Assistance Act (25 U.S.C. 450b(l))),'' after ``special
districts,''.
(e) Inclusion of Land Management Plans and Formal
Rulemaking.--
(1) Initial regulatory flexibility analysis.--
Subsection (a) of section 603 of title 5, United States
Code, is amended in the first sentence--
(A) by striking ``or'' after ``proposed
rule,''; and
(B) by inserting ``or publishes a revision or
amendment to a land management plan,'' after
``United States,''.
(2) Final regulatory flexibility analysis.--
Subsection (a) of section 604 of title 5, United States
Code, is amended in the first sentence--
(A) by striking ``or'' after ``proposed
rulemaking,''; and
(B) by inserting ``, or adopts a revision or
amendment to a land management plan,'' after
``section 603(a),''.
(3) Land management plan defined.--Section 601 of
title 5, United States Code, is amended by adding at
the end the following new paragraph:
``(10) Land management plan.--
``(A) In general.--The term `land management
plan' means--
``(i) any plan developed by the
Secretary of Agriculture under section
6 of the Forest and Rangeland Renewable
Resources Planning Act of 1974 (16
U.S.C. 1604); and
``(ii) any plan developed by the
Secretary of Interior under section 202
of the Federal Land Policy and
Management Act of 1976 (43 U.S.C.
1712).
``(B) Revision.--The term `revision' means
any change to a land management plan which--
``(i) in the case of a plan described
in subparagraph (A)(i), is made under
section 6(f)(5) of the Forest and
Rangeland Renewable Resources Planning
Act of 1974 (16 U.S.C. 1604(f)(5)); or
``(ii) in the case of a plan
described in subparagraph (A)(ii), is
made under section 1610.5-6 of title
43, Code of Federal Regulations (or any
successor regulation).
``(C) Amendment.--The term `amendment' means
any change to a land management plan which--
``(i) in the case of a plan described
in subparagraph (A)(i), is made under
section 6(f)(4) of the Forest and
Rangeland Renewable Resources Planning
Act of 1974 (16 U.S.C. 1604(f)(4)) and
with respect to which the Secretary of
Agriculture prepares a statement
described in section 102(2)(C) of the
National Environmental Policy Act of
1969 (42 U.S.C. 4332(2)(C)); or
``(ii) in the case of a plan
described in subparagraph (A)(ii), is
made under section 1610.5-5 of title
43, Code of Federal Regulations (or any
successor regulation) and with respect
to which the Secretary of the Interior
prepares a statement described in
section 102(2)(C) of the National
Environmental Policy Act of 1969 (42
U.S.C. 4332(2)(C)).''.
(f) Inclusion of Certain Interpretive Rules Involving the
Internal Revenue Laws.--
(1) In general.--Subsection (a) of section 603 of
title 5, United States Code, is amended by striking the
period at the end and inserting ``or a recordkeeping
requirement, and without regard to whether such
requirement is imposed by statute or regulation.''.
(2) Collection of information.--Paragraph (7) of
section 601 of title 5, United States Code, is amended
to read as follows:
``(7) Collection of information.--The term
`collection of information' has the meaning given such
term in section 3502(3) of title 44, United States
Code.''.
(3) Recordkeeping requirement.--Paragraph (8) of
section 601 of title 5, United States Code, is amended
to read as follows:
``(8) Recordkeeping requirement.--The term
`recordkeeping requirement' has the meaning given such
term in section 3502(13) of title 44, United States
Code.''.
(g) Definition of Small Organization.--Paragraph (4) of
section 601 of title 5, United States Code, is amended to read
as follows:
``(4) Small organization.--
``(A) In general.--The term `small
organization' means any not-for-profit
enterprise which, as of the issuance of the
notice of proposed rulemaking--
``(i) in the case of an enterprise
which is described by a classification
code of the North American Industrial
Classification System, does not exceed
the size standard established by the
Administrator of the Small Business
Administration pursuant to section 3 of
the Small Business Act (15 U.S.C. 632)
for small business concerns described
by such classification code; and
``(ii) in the case of any other
enterprise, has a net worth that does
not exceed $7,000,000 and has not more
than 500 employees.
``(B) Local labor organizations.--In the case
of any local labor organization, subparagraph
(A) shall be applied without regard to any
national or international organization of which
such local labor organization is a part.
``(C) Agency definitions.--Subparagraphs (A)
and (B) shall not apply to the extent that an
agency, after consultation with the Office of
Advocacy of the Small Business Administration
and after opportunity for public comment,
establishes one or more definitions for such
term which are appropriate to the activities of
the agency and publishes such definitions in
the Federal Register.''.

SEC. 3. REQUIREMENTS PROVIDING FOR MORE DETAILED ANALYSES.

(a) Initial Regulatory Flexibility Analysis.--
(1) Subsection (b) of section 603 of title 5, United
States Code, is amended to read as follows:
``(b) Each initial regulatory flexibility analysis required
under this section shall contain a detailed statement--
``(1) describing the reasons why action by the agency
is being considered;
``(2) describing the objectives of, and legal basis
for, the proposed rule;
``(3) estimating the number and type of small
entities to which the proposed rule will apply;
``(4) describing the projected reporting,
recordkeeping, and other compliance requirements of the
proposed rule, including an estimate of the classes of
small entities which will be subject to the requirement
and the type of professional skills necessary for
preparation of the report and record;
``(5) describing all relevant Federal rules which may
duplicate, overlap, or conflict with the proposed rule,
or the reasons why such a description could not be
provided;
``(6) estimating the additional cumulative economic
impact of the proposed rule on small entities beyond
that already imposed on the class of small entities by
the agency or why such an estimate is not available;
and
``(7) describing any disproportionate economic impact
on small entities or a specific class of small
entities.''.
(b) Final Regulatory Flexibility Analysis.--
(1) In general.--Section 604(a) of title 5, United
States Code, is amended--
(A) in paragraph (4), by striking ``an
explanation'' and inserting ``a detailed
explanation'';
(B) in each of paragraphs (4), (5), and the
first paragraph (6), by inserting ``detailed''
before ``description''; and
(C) by adding at the end the following:
``(7) describing any disproportionate economic impact
on small entities or a specific class of small
entities.''.
(2) Inclusion of response to comments on
certification of proposed rule.--Paragraph (2) of
section 604(a) of title 5, United States Code, is
amended by inserting ``(or certification of the
proposed rule under section 605(b))'' after ``initial
regulatory flexibility analysis''.
(3) Publication of analysis on website.--Subsection
(b) of section 604 of title 5, United States Code, is
amended to read as follows:
``(b) The agency shall make copies of the final regulatory
flexibility analysis available to the public, including
placement of the entire analysis on the agency's website, and
shall publish in the Federal Register the final regulatory
flexibility analysis, or a summary thereof which includes the
telephone number, mailing address, and link to the website
where the complete analysis may be obtained.''.
(c) Cross-References to Other Analyses.--Subsection (a) of
section 605 of title 5, United States Code, is amended to read
as follows:
``(a) A Federal agency shall be treated as satisfying any
requirement regarding the content of an agenda or regulatory
flexibility analysis under section 602, 603, or 604, if such
agency provides in such agenda or analysis a cross-reference to
the specific portion of another agenda or analysis which is
required by any other law and which satisfies such
requirement.''.
(d) Certifications.--Subsection (b) of section 605 of title
5, United States Code, is amended--
(1) by inserting ``detailed'' before ``statement'';
and
(2) by inserting ``and legal'' after ``factual''.
(e) Quantification Requirements.--Section 607 of title 5,
United States Code, is amended to read as follows:

``Sec. 607. Quantification requirements

``In complying with sections 603 and 604, an agency shall
provide--
``(1) a quantifiable or numerical description of the
effects of the proposed or final rule and alternatives
to the proposed or final rule; or
``(2) a more general descriptive statement and a
detailed statement explaining why quantification is not
practicable or reliable.''.

SEC. 4. REPEAL OF WAIVER AND DELAY AUTHORITY; ADDITIONAL POWERS OF THE
CHIEF COUNSEL FOR ADVOCACY.

(a) In General.--Section 608 is amended to read as follows:

``Sec. 608. Additional powers of Chief Counsel for Advocacy

``(a)(1) Not later than 270 days after the date of the
enactment of the Regulatory Flexibility Reform Act, the Chief
Counsel for Advocacy of the Small Business Administration
shall, after opportunity for notice and comment under section
553, issue rules governing agency compliance with this chapter.
The Chief Counsel may modify or amend such rules after notice
and comment under section 553. This chapter (other than this
subsection) shall not apply with respect to the issuance,
modification, and amendment of rules under this paragraph.
``(2) An agency shall not issue rules which supplement the
rules issued under subsection (a) unless such agency has first
consulted with the Chief Counsel for Advocacy to ensure that
such supplemental rules comply with this chapter and the rules
issued under paragraph (1).
``(b) Notwithstanding any other law, the Chief Counsel for
Advocacy of the Small Business Administration may intervene in
any agency adjudication (unless such agency is authorized to
impose a fine or penalty under such adjudication), and may
inform the agency of the impact that any decision on the record
may have on small entities. The Chief Counsel shall not
initiate an appeal with respect to any adjudication in which
the Chief Counsel intervenes under this subsection.
``(c) The Chief Counsel for Advocacy may file comments in
response to any agency notice requesting comment, regardless of
whether the agency is required to file a general notice of
proposed rulemaking under section 553.''.
(b) Conforming Amendments.--
(1) Section 611(a)(1) of such title is amended by
striking ``608(b),''.
(2) Section 611(a)(2) of such title is amended by
striking ``608(b),''.
(3) Section 611(a)(3) of such title is amended--
(A) by striking subparagraph (B); and
(B) by striking ``(3)(A) A small entity'' and
inserting the following:
``(3) A small entity''.

SEC. 5. PROCEDURES FOR GATHERING COMMENTS.

Section 609 of title 5, United States Code, is amended by
striking subsection (b) and all that follows and inserting the
following:
``(b)(1) Prior to publication of any proposed rule described
in subsection (e), an agency making such rule shall notify the
Chief Counsel for Advocacy of the Small Business Administration
and provide the Chief Counsel with--
``(A) all materials prepared or utilized by the
agency in making the proposed rule, including the draft
of the proposed rule; and
``(B) information on the potential adverse and
beneficial economic impacts of the proposed rule on
small entities and the type of small entities that
might be affected.
``(2) An agency shall not be required under paragraph (1) to
provide the exact language of any draft if the rule--
``(A) relates to the internal revenue laws of the
United States; or
``(B) is proposed by an independent regulatory agency
(as defined in section 3502(5) of title 44, United
States Code).
``(c) Not later than 15 days after the receipt of such
materials and information under subsection (b), the Chief
Counsel for Advocacy of the Small Business Administration
shall--
``(1) identify small entities or representatives of
small entities or a combination of both for the purpose
of obtaining advice, input, and recommendations from
those persons about the potential economic impacts of
the proposed rule and the compliance of the agency with
section 603 of this title; and
``(2) convene a review panel consisting of an
employee from the Office of Advocacy of the Small
Business Administration, an employee from the agency
making the rule, and in the case of an agency other
than an independent regulatory agency (as defined in
section 3502(5) of title 44, United States Code), an
employee from the Office of Information and Regulatory
Affairs of the Office of Management and Budget to
review the materials and information provided to the
Chief Counsel under subsection (b).
``(d)(1) Not later than 60 days after the review panel
described in subsection (c)(2) is convened, the Chief Counsel
for Advocacy of the Small Business Administration shall, after
consultation with the members of such panel, submit a report to
the agency and, in the case of an agency other than an
independent regulatory agency (as defined in section 3502(5) of
title 44, United States Code), the Office of Information and
Regulatory Affairs of the Office of Management and Budget.
``(2) Such report shall include an assessment of the economic
impact of the proposed rule on small entities and a discussion
of any alternatives that will minimize adverse significant
economic impacts or maximize beneficial significant economic
impacts on small entities.
``(3) Such report shall become part of the rulemaking record.
In the publication of the proposed rule, the agency shall
explain what actions, if any, the agency took in response to
such report.
``(e) A proposed rule is described by this subsection if the
Administrator of the Office of Information and Regulatory
Affairs of the Office of Management and Budget, the head of the
agency (or the delegatee of the head of the agency), or an
independent regulatory agency determines that the proposed rule
is likely to result in--
``(1) an annual effect on the economy of $100,000,000
or more;
``(2) a major increase in costs or prices for
consumers, individual industries, Federal, State, or
local governments, tribal organizations, or geographic
regions;
``(3) significant adverse effects on competition,
employment, investment, productivity, innovation, or on
the ability of United States-based enterprises to
compete with foreign-based enterprises in domestic and
export markets; or
``(4) a significant economic impact on a substantial
number of small entities.
``(f) Upon application by the agency, the Chief Counsel for
Advocacy of the Small Business Administration may waive the
requirements of subsections (b) through (e) if the Chief
Counsel determines that compliance with the requirements of
such subsections are impracticable, unnecessary, or contrary to
the public interest.''.

SEC. 6. PERIODIC REVIEW OF RULES.

Section 610 of title 5, United States Code, is amended to
read as follows:

``Sec. 610. Periodic review of rules

``(a) Not later than 180 days after the enactment of the
Regulatory Flexibility Improvements Act of 2011, each agency
shall publish in the Federal Register and place on its website
a plan for the periodic review of rules issued by the agency
which the head of the agency determines have a significant
economic impact on a substantial number of small entities. Such
determination shall be made without regard to whether the
agency performed an analysis under section 604. The purpose of
the review shall be to determine whether such rules should be
continued without change, or should be amended or rescinded,
consistent with the stated objectives of applicable statutes,
to minimize any adverse significant economic impacts or
maximize any beneficial significant economic impacts on a
substantial number of small entities. Such plan may be amended
by the agency at any time by publishing the revision in the
Federal Register and subsequently placing the amended plan on
the agency's website.
``(b) The plan shall provide for the review of all such
agency rules existing on the date of the enactment of the
Regulatory Flexibility Improvements Act of 2011 within 10 years
of the date of publication of the plan in the Federal Register
and for review of rules adopted after the date of enactment of
the Regulatory Flexibility Improvements Act of 2011 within 10
years after the publication of the final rule in the Federal
Register. If the head of the agency determines that completion
of the review of existing rules is not feasible by the
established date, the head of the agency shall so certify in a
statement published in the Federal Register and may extend the
review for not longer than 2 years after publication of notice
of extension in the Federal Register. Such certification and
notice shall be sent to the Chief Counsel for Advocacy of the
Small Business Administration and the Congress.
``(c) Each agency shall annually submit a report regarding
the results of its review pursuant to such plan to the
Congress, the Chief Counsel for Advocacy of the Small Business
Administration, and, in the case of agencies other than
independent regulatory agencies (as defined in section 3502(5)
of title 44, United States Code) to the Administrator of the
Office of Information and Regulatory Affairs of the Office of
Management and Budget. Such report shall include the
identification of any rule with respect to which the head of
the agency made a determination described in paragraph (5) or
(6) of subsection (d) and a detailed explanation of the reasons
for such determination.
``(d) In reviewing a rule pursuant to subsections (a) through
(c), the agency shall amend or rescind the rule to minimize any
adverse significant economic impact on a substantial number of
small entities or disproportionate economic impact on a
specific class of small entities, or maximize any beneficial
significant economic impact of the rule on a substantial number
of small entities to the greatest extent possible, consistent
with the stated objectives of applicable statutes. In amending
or rescinding the rule, the agency shall consider the following
factors:
``(1) The continued need for the rule.
``(2) The nature of complaints received by the agency
from small entities concerning the rule.
``(3) Comments by the Regulatory Enforcement
Ombudsman and the Chief Counsel for Advocacy of the
Small Business Administration.
``(4) The complexity of the rule.
``(5) The extent to which the rule overlaps,
duplicates, or conflicts with other Federal rules and,
unless the head of the agency determines it to be
infeasible, State and local rules.
``(6) The contribution of the rule to the cumulative
economic impact of all Federal rules on the class of
small entities affected by the rule, unless the head of
the agency determines that such calculations cannot be
made and reports that determination in the annual
report required under subsection (c).
``(7) The length of time since the rule has been
evaluated or the degree to which technology, economic
conditions, or other factors have changed in the area
affected by the rule.
``(e) The agency shall publish in the Federal Register and on
its website a list of rules to be reviewed pursuant to such
plan. Such publication shall include a brief description of the
rule, the reason why the agency determined that it has a
significant economic impact on a substantial number of small
entities (without regard to whether it had prepared a final
regulatory flexibility analysis for the rule), and request
comments from the public, the Chief Counsel for Advocacy of the
Small Business Administration, and the Regulatory Enforcement
Ombudsman concerning the enforcement of the rule.''.

SEC. 7. JUDICIAL REVIEW OF COMPLIANCE WITH THE REQUIREMENTS OF THE
REGULATORY FLEXIBILITY ACT AVAILABLE AFTER
PUBLICATION OF THE FINAL RULE.

(a) In General.--Paragraph (1) of section 611(a) of title 5,
United States Code, is amended by striking ``final agency
action'' and inserting ``such rule''.
(b) Jurisdiction.--Paragraph (2) of such section is amended
by inserting ``(or which would have such jurisdiction if
publication of the final rule constituted final agency
action)'' after ``provision of law,''.
(c) Time for Bringing Action.--Paragraph (3) of such section
is amended--
(1) by striking ``final agency action'' and inserting
``publication of the final rule''; and
(2) by inserting ``, in the case of a rule for which
the date of final agency action is the same date as the
publication of the final rule,'' after ``except that''.
(d) Intervention by Chief Counsel for Advocacy.--Subsection
(b) of section 612 of title 5, United States Code, is amended
by inserting before the first period ``or agency compliance
with section 601, 603, 604, 605(b), 609, or 610''.

SEC. 8. JURISDICTION OF COURT OF APPEALS OVER RULES IMPLEMENTING THE
REGULATORY FLEXIBILITY ACT.

(a) In General.--Section 2342 of title 28, United States
Code, is amended--
(1) in paragraph (6), by striking ``and'' at the end;
(2) in paragraph (7), by striking the period at the
end and inserting ``; and''; and
(3) by adding at the end the following new paragraph:
``(8) all final rules under section 608(a) of title
5, United States Code.''.
(b) Conforming Amendments.--Paragraph (3) of section 2341 of
title 28, United States Code, is amended--
(1) in subparagraph (D), by striking ``and'' at the
end;
(2) in subparagraph (E), by striking the period at
the end and inserting ``; and''; and
(3) by adding at the end the following new
subparagraph:
``(F) the Office of Advocacy of the Small
Business Administration, when the final rule is
under section 608(a) of title 5, United States
Code.''.
(c) Authorization To Intervene and Comment on Agency
Compliance With Administrative Procedure.--Subsection (b) of
section 612 of title 5, United States Code, is amended by
inserting ``chapter 5, and chapter 7,'' after ``this
chapter,''.

SEC. 9. CLERICAL AMENDMENTS.

(a) Section 601 of title 5, United States Code, is amended--
(1) in paragraph (1)--
(A) by striking the semicolon at the end and
inserting a period; and
(B) by striking ``(1) the term'' and
inserting the following:
``(1) Agency.--The term'';
(2) in paragraph (3)--
(A) by striking the semicolon at the end and
inserting a period, and
(B) by striking ``(3) the term'' and
inserting the following:
``(3) Small business.--The term'';
(3) in paragraph (5)--
(A) by striking the semicolon at the end and
inserting a period, and
(B) by striking ``(5) the term'' and
inserting the following:
``(5) Small governmental jurisdiction.--The term'';
and
(4) in paragraph (6)--
(A) by striking ``; and'' and inserting a
period, and
(B) by striking ``(6) the term'' and
inserting the following:
``(6) Small entity.--The term''.
(b) The heading of section 605 of title 5, United States
Code, is amended to read as follows:

``Sec. 605. Incorporations by reference and certifications''.

(c) The table of sections for chapter 6 of title 5, United
States Code, is amended--
(1) by striking the item relating to section 605 and
inserting the following new item:

``605. Incorporations by reference and certifications'';

(2) by striking the item relating to section 607 and
inserting the following new item:

``607. Quantification requirements'';

and
(3) by striking the item relating to section 608 and
inserting the following:

``608. Additional powers of Chief Counsel for Advocacy''.

(d) Chapter 6 of title 5, United States Code, is amended as
follows:
(1) In section 603, by striking subsection (d).
(2) In section 604(a) by striking the second
paragraph (6).

H.R. 585

Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the ``Small Business Size Standard
Flexibility Act of 2011''.

SEC. 2. ESTABLISHMENT AND APPROVAL OF SMALL BUSINESS CONCERN SIZE
STANDARDS BY CHIEF COUNSEL FOR ADVOCACY.

(a) In General.--Subparagraph (A) of section 3(a)(2) of the
Small Business Act (15 U.S.C. 632(a)(2)(A)) is amended to read
as follows:
``(A) In general.--In addition to the
criteria specified in paragraph (1)--
``(i) the Administrator may specify
detailed definitions or standards by
which a business concern may be
determined to be a small business
concern for purposes of this Act or the
Small Business Investment Act of 1958;
and
``(ii) the Chief Counsel for Advocacy
may specify such definitions or
standards for purposes of any other
Act.''.
(b) Approval by Chief Counsel.--Clause (iii) of section
3(a)(2)(C) of the Small Business Act (15 U.S.C.
632(a)(2)(C)(iii)) is amended to read as follows:
``(iii) except in the case of a size
standard prescribed by the
Administrator, is approved by the Chief
Counsel for Advocacy.''.
(c) Industry Variation.--Paragraph (3) of section 3(a) of the
Small Business Act (15 U.S.C. 632(a)(3)) is amended--
(1) by inserting ``or Chief Counsel for Advocacy, as
appropriate'' before ``shall ensure''; and
(2) by inserting ``or Chief Counsel for Advocacy''
before the period at the end.
(d) Judicial Review of Size Standards Approved by Chief
Counsel.--Section 3(a) of the Small Business Act (15 U.S.C.
632(a)) is amended by adding at the end the following new
paragraph:
``(6) Judicial Review of Standards Approved by Chief
Counsel.--In the case of an action for judicial review of a
rule which includes a definition or standard approved by the
Chief Counsel for Advocacy under this subsection, the party
seeking such review shall be entitled to join the Chief Counsel
as a party in such action.''.

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