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Administration directs agencies to weigh ‘cumulative' burden of regs

Mar. 22, 2012 - 11:08AM   |  
By SARAH CHACKO   |   Comments

Small-business advocates applaud a new Obama administration attempt to push agencies to weigh the "cumulative'' burden of regulations they approve.

Some agencies are good about reaching out to experts like the Small Business Administration's Office of Advocacy as they write new regulations, but many agencies do not, said Molly Brogan, spokeswoman for the National Small Business Association, which represents 150,000 small businesses.

A">memo released Tuesday from Cass Sunstein, administrator of the Office of Information and Regulatory Affairs Administrator (OIRA), directs agencies to take nine steps to improve communication with people most affected by rule changes and to better analyze effects.

Agencies already are doing a retrospective review of regulations required by an executive order issued last year. But that analysis is a rule-by-rule review of outdated or obsolete regulations, not a study of the cumulative burden, said Alan Chvotkin, executive vice president of the Professional Services Council.

Agencies are challenged by having to create regulations but businesses have to worry about how to implement all the various regulations, he said. "If you impose a burden on one element, it has effects on other elements in the procurement system," he said.

Additional regulations have the potential of significant economic impact on small businesses, Brogan said. She pointed, for example, to a National Labor Relations Board rule effective April 30 to fast-track union elections. The rule means small-business owners have only about a week to find labor law attorneys and detail any objections or concerns they may have about the election, Brogan said.

"‘Cumulative' is a really important word when you're talking about small business and regulation," she said.

The new memo directs agencies to consider:

Early engagement with state, tribal and local regulatory agencies to identify opportunities for balancing regulatory requirements, reducing administrative costs, and avoiding unnecessary or inconsistent requirements.

The cumulative effects of regulations on small businesses and start-ups.

Coordination of timing, content and requirements of multiple rulemakings for a particular industry or sector.

The biggest challenge will be getting agencies to take the steps Sunstein laid out because OIRA's enforcement reach is limited, Brogan said.

"OIRA is a pretty lean office," she said. "And when you're talking about one office policing all federal agencies in terms of regulations, it's going to be tough to put some teeth behind it."

OIRA will likely issue reporting requirements to monitor agencies progress on the new memo, Chvotkin said.

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