Implementation of the Small Business Advocacy Review Panel Requirements
GGD-98-36, Mar 18, 1998
Pursuant to a congressional request, GAO reviewed the Environmental Protection Agency's (EPA) and the Occupational Safety and Health Administration's (OSHA) implementation of the Small Business Regulatory Enforcement Fairness Act's (SBREFA) advocacy review panel requirements, focusing on: (1) whether EPA and OSHA had applied the advocacy review panel requirements to all rules that they proposed between June 28, 1996, and June 28, 1997, that may have a significant economic impact on a substantial number of small entities; (2) whether the EPA and OSHA panels, the regulatory agencies themselves, and SBA's Chief Counsel for Advocacy followed the statute's procedural requirements for panels convened between June 28, 1996, and November 1, 1997, and whether there were differences among the panels in how the statute's requirements were implemented; (3) the changes, if any, that EPA and OSHA made to notices of proposed rulemaking as a result of the panels' recommendations; and (4) any suggestions that EPA and OSHA agency officials and small entity representatives may have regarding how the advocacy review panel process could be improved.
GAO noted that: (1) during the first year of the SBREFA advocacy review panel requirements' implementation, OSHA convened a panel for one draft rule and published two other proposed rules for which panels were not held; (2) the Small Business Administration's (SBA) Chief Counsel for Advocacy agreed with OSHA's certification that neither of these two proposed rules required an advocacy review panel; (3) as of November 1, 1997, EPA had convened advocacy review panels for four draft rules; (4) EPA published 17 other proposed rules during the first year of the panel requirements that were reviewed by the Office of Information and Regulatory Affairs and for which panels were not held because EPA certified that the proposed rules would not have a significant economic impact on a substantial number of small entities; (5) the Chief Counsel said EPA should have convened panels for 2 of these 17 proposed rules; (6) it is unclear whether EPA should have convened panels for these rules because there are no criteria for determining whether a draft rule will have an impact on small entities; (7) EPA and OSHA panels, the regulatory agencies themselves, and the SBA Chief Counsel for Advocacy generally followed SBREFA's advocacy review panel procedural requirements in the five panels that had been convened as of November 1, 1997; (8) however, the panels did not meet some of the specific deadlines that SBREFA established; (9) there were some differences in how the five panels were conducted; (10) some of these differences appeared to occur because the panel process is new and evolving; however, the panels have made adjustments to their procedures as they have gained experience; (11) the five panels' recommendations to the regulatory agency heads focused on the agencies' consideration of additional regulatory alternatives and clarification of what the draft rules would require; (12) as of November 1, 1997, EPA and OSHA each had published one notice of proposed rulemaking for which they had convened advocacy review panels; (13) the agencies primarily responded to the panels' recommendations in the preambles of those notices, soliciting public comments on issues that the panels had recommended; and (14) many of the small entity representatives that GAO interviewed suggested ways to improve the panel process.
- Review Pending
- Closed - implemented
- Closed - not implemented
Matters for Congressional Consideration
Matter: If Congress wishes to clarify and strengthen the implementation of the Regulatory Flexibility Act (RFA) and SBREFA, it should consider providing SBA or another entity with clearer authority and responsibility to interpret the RFA's provisions on a governmentwide basis.
Status: Closed - Implemented
Comments: On May 9, 2001, Senator Bond introduced S. 849, part of which required the Chief Counsel for Advocacy within the Small Business Administration to promulgate regulations within 18 months to define the terms "significant economic impact" and "substantial number of small entities."
Matter: Congress could consider establishing, or requiring SBA or another entity to develop, governmentwide criteria defining the phrase "significant economic impact on a substantial number of small entities." Those criteria should specify whether the establishment of regulatory standards by a federal agency should be separated from their implementation requirements imposed by other entities for the purposes of the RFA and SBREFA.
Status: Closed - Implemented
Comments: On May 9, 2001, Senator Bond introduced S.849, part of which required the Chief Counsel for Advocacy within the Small Business Administration to promulgate regulations within 18 months to define the terms "significant ecomomic impact" and "substantial number of small entities."