Regulatory Flexibility Act:

Implementation of the Small Business Advocacy Review Panel Requirements

T-GGD-98-75: Published: Mar 18, 1998. Publicly Released: Mar 18, 1998.

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GAO discussed the Small Business Regulatory Enforcement Fairness Act's (SBREFA) advocacy review panel provisions, focusing on: (1) whether the Environmental Protection Agency (EPA) or the Occupational Safety and Health Administration (OSHA) had applied the advocacy review panel requirements to all applicable rules that they proposed in the first year of the panel requirements; (2) whether the EPA and OSHA panels, the regulatory agencies themselves, and the Small Business Administration's (SBA) Chief Counsel for Advocacy followed the statute's procedural requirements; (3) identify any changes that EPA and OSHA made to the draft rules as a result of the panels' recommendations; and (4) identify any suggestions that agency officials and small entity representatives had regarding how the advocacy review panel process could be improved.

GAO noted that: (1) as of November 1, 1997, EPA and OSHA had convened five review panels; (2) EPA and SBA's Chief Counsel for Advocacy disagree regarding the applicability of the panel requirements to two other rules that EPA proposed in December 1996--the national ambient air quality standards for ozone and for particulate matter; (3) specifically, EPA and the Chief Counsel disagree regarding whether the effects of states' implementation of these health standards can be separated from the standards themselves in determining whether EPA's rules may have a significant economic impact on a substantial number of small entities; (4) GAO suggested that Congress resolve this issue by taking steps to clarify the meaning of the term "significant impact"; (5) the agencies and the panels generally met SBREFA's procedural requirements, but there were several differences in how the panels operated; (6) the panels' recommendations regarding the two proposed rules that had been published as of November 1, 1997, focused on various issues, such as providing small entities with greater compliance flexibility and considering the effects of potentially overlapping regulations; (7) the agencies generally responded to those recommendations in the supplementary information sections of the proposed rules; and (8) the small entity representatives with whom GAO spoke and, to a lesser extent, the agency officials GAO interviewed, offered several suggestions to improve the advocacy review panel process.

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