Volume 145, No. 128 covering the 1st Session of the 106th Congress (1999 - 2000) was published by the Congressional Record.
The Congressional Record is a unique source of public documentation. It started in 1873, documenting nearly all the major and minor policies being discussed and debated.
“SMALL BUSINESS ADVOCACY REVIEW PANEL TECHNICAL AMENDMENTS ACT OF 1999” mentioning the Environmental Protection Agency was published in the Senate section on pages S11578-S11580 on Sept. 28, 1999.
The publication is reproduced in full below:
SMALL BUSINESS ADVOCACY REVIEW PANEL TECHNICAL AMENDMENTS ACT OF 1999
Mr. HAGEL. Mr. President, on behalf of the leader, I ask unanimous consent that the Senate now proceed to the consideration of calendar No. 273, S. 1156.
The PRESIDING OFFICER. The clerk will report the bill by title.
The legislative clerk read as follows:
A bill (S. 1156) to amend provisions of law enacted by the Small Business Regulatory Enforcement Fairness Act of 1996 and to ensure full analysis of potential impacts on small entities of rules proposed by certain agencies, and for other purposes.
There being no objection, the Senate proceeded to consider the bill, which had been reported from the Committee on Small Business, with amendments; as follows:
(The parts of the bill intended to be stricken are shown in boldface brackets and the parts of the bill to be inserted are shown in italic.)
S. 1156
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 Advocacy Review Panel Technical Amendments Act of 1999''.
SEC. 2. FINDINGS AND PURPOSES.
(a) Findings.--The Congress finds the following:
(1) A vibrant and growing small business sector is critical to creating jobs in a dynamic economy.
(2) Small businesses bear a disproportionate share of regulatory costs and burdens.
(3) Federal agencies must consider the impact of their regulations on small businesses early in the rulemaking process.
(4) The Small Business Advocacy Review Panel process that was established by the Small Business Regulatory Enforcement Fairness Act of 1996 has been effective in allowing small businesses to participate in rules that are being developed by the Environmental Protection Agency and the Occupational Safety and Health Administration.
(b) Purposes.--The purposes of this Act are the following:
(1) To provide a forum for the effective participation of small businesses in the Federal regulatory process.
(2) To clarify and strengthen the Small Business Advocacy Review Panel process.
(3) To expand the number of Federal agencies that are required to convene Small Business Advocacy Review Panels.
SEC. 3. ENSURING FULL ANALYSIS OF POTENTIAL IMPACTS ON SMALL
ENTITIES OF RULES PROPOSED BY CERTAIN AGENCIES.
Section 609(b) of title 5, United States Code, is amended to read as follows:
``(b)(1) Before the publication of an initial regulatory flexibility analysis that a covered agency is required to conduct under this chapter, the head of the covered agency shall--
``(A) notify the Chief Counsel for Advocacy of the Small Business Administration (in this subsection referred to as the `Chief Counsel') in writing;
``(B) provide the Chief Counsel with information on the potential impacts of the proposed rule on small entities and the type of small entities that might be affected; and
``(C) not later than 30 days after complying with subparagraphs (A) and (B)--
``(i) [with the concurrence of] in consultation with the Chief Counsel, identify affected small entity representatives; and
``(ii) transmit to the identified small entity representatives a detailed summary of the information referred to in subparagraph (B) or the information in full, if so requested by the small entity representative, for the purposes of obtaining advice and recommendations about the potential impacts of the draft proposed rule.
``(2)(A) Not earlier than 30 days after the covered agency transmits information pursuant to paragraph (1)(C)(ii), the head of the covered agency shall convene a review panel for the draft proposed rule. The panel shall consist solely of full-time Federal employees of the office within the covered agency that will be responsible for carrying out the proposed rule, the Office of Information and Regulatory Affairs of the Office of Management and Budget, and the Chief Counsel.
``(B) The review panel shall--
``(i) review any material the covered agency has prepared in connection with this chapter, including any draft proposed rule;
``(ii) collect advice and recommendations from the small entity representatives identified under paragraph (1)(C)(i) on issues related to paragraphs (3), (4), and (5) of section 603(b) and section 603(c); and
``(iii) allow any small entity representative identified under paragraph (1)(C)(i) to make an oral presentation to the panel, if requested.
``(C) Not later than 60 days after the date a covered agency convenes a review panel pursuant to this paragraph, the review panel shall report to the head of the covered agency on--
``(i) the comments received from the small entity representatives identified under paragraph (1)(C)(i); and
``(ii) its findings regarding issues related to paragraphs
(3), (4), and (5) of section 603(b) and section 603(c).
``(3)(A) Except as provided in subparagraph (B), the head of the covered agency shall print in the Federal Register the report of the review panel under paragraph (2)(C), including any written comments submitted by the small entity representatives and any appendices cited in the report, as soon as practicable, but not later than--
``(i) 180 days after the date the head of the covered agency receives the report; or
``(ii) the date of the publication of the notice of proposed rulemaking for the proposed rule.
``(B) The report of the review panel printed in the Federal Register shall not include any confidential business information submitted by any small entity representative.
``(4) Where appropriate, the covered agency shall modify the draft proposed rule, the initial regulatory flexibility analysis for the draft proposed rule, or the decision on whether an initial regulatory flexibility analysis is required for the draft proposed rule.''.
SEC. 4. DEFINITIONS.
Section 609(d) of title 5, United States Code, is amended to read as follows:
``(d) For the purposes of this section--
``(1) the term `covered agency' means the Environmental Protection Agency, the Occupational Safety and Health Administration of the Department of Labor, and the Internal Revenue Service of the Department of the Treasury; and
``(2) the term `small entity representative' means a small entity, or an individual or organization that primarily represents the interests of 1 or more small entities.''.
SEC. 5. COLLECTION OF INFORMATION REQUIREMENT.
(a) Definition.--Section 601 of title 5, United States Code, is amended--
(1) in paragraph (5) by inserting ``and'' after the semicolon;
(2) in paragraph (6) by striking ``; and'' and inserting a period; and
(3) by striking paragraphs (7) and (8).
(b) Initial Regulatory Flexibility Analysis.--The [fourth] fifth sentence of section 603 of title 5, United States Code, is amended to read as follows: ``In the case of an interpretative rule involving the internal revenue laws of the United States, this chapter applies to interpretative rules (including proposed, temporary, and final regulations) published in the Federal Register for codification in the Code of Federal Regulations.''.
SEC. 6. EFFECTIVE DATE.
This Act shall take effect upon the expiration of the 90-day period beginning on the date of the enactment of this Act.
Mr. BOND. Mr. President, I rise today to speak in support of the Small Business Advocacy Review Panel Technical Amendments Act of 1999, S. 1156. This bill was approved by the Committee on Small Business which I chair, with unanimous bipartisan support. Senator Kerry, the Ranking Member of the Committee, was the lead cosponsor of this important small business legislation.
Our bill is simple and straightforward. It clarifies and amends certain provisions of the law enacted as part of my ``Red Tape Reduction Act,'' the Small Business Regulatory Enforcement Fairness Act of 1996. In 1996, this body led the way toward enactment of this important law. With a unanimous vote, we took a major step to ensure that small businesses get an opportunity to participate in the rulemaking process when their input can have the greatest impact, and that they are treated fairly by federal agencies.
The overall purpose of the Regulatory Flexibility Act and the Small Business Regulatory Enforcement Fairness Act, is to identify and minimize the burdens of the regulations on the small businesses affected by the agency's actions, and to help the agency make the rule as effective as possible when it is implemented.
Under the Small Business Regulatory Enforcement Fairness Act of 1996, which amended the Regulatory Flexibility Act, each ``covered agency'' is required to convene a Small Business Advocacy Review Panel (Panel) to receive advice and comments from small entities that will be affected by the regulation being developed. Specifically, under section 609(b), each covered agency is to convene a Panel with representatives from the Office of Information and Regulatory Affairs within the Office of Management and Budget, the Chief Counsel of Advocacy of the Small Business Administration, and the covered agency promulgating the regulation, to receive input from small entities prior to publishing an Initial Regulatory Flexibility Analysis for a proposed rule with a significant economic impact on a substantial number of small entities. The Panel produces a report containing comments from the small entities and the Panel's own recommendations. The report is provided to the head of the agency, who reviews it and, where appropriate, modifies the proposed rule, Initial Regulatory Flexibility Analysis or the decision on whether the rule significantly impacts small entities. The Panel report then becomes a part of the rulemaking record.
Under current law, the Occupational Safety and Health Administration
(OSHA) and the Environmental Protection Agency (EPA) are the only agencies covered by the Panel process. So far, the results are encouraging with these agencies clearly benefitting from the input of the small entities that have participated in the review panels. In addition, the bill will bring the Internal Revenue Service, the agency that has perhaps the most pervasive impact on small businesses, into the Panel process by mandating the agency to convene panels for certain proposed rulemakings that will impact small businesses.
Our bill also clarifies how the Regulatory Flexibility Act generally applies to the IRS. In 1996, Congress expressly included the IRS within the coverage of the Red Tape Reduction Act which amended the Regulatory Flexibility Act. However, the Treasury Department has interpreted the language in the law in a manner that essentially writes them out of the law. The Small Business Advocacy Review Panel Technical Amendments Act of 1999 clarifies which interpretative rules involving the Internal Revenue Code are to be subject to compliance with the Regulatory Flexibility Act. As I noted previously, for those rules that will impose a significant economic impact on a substantial number of small entities, the IRS will also be required under our bill to convene a Small Business Advocacy Review Panel as required by SBREFA.
If the Treasury Department and the IRS had implemented the Red Tape Reduction Act as Congress originally intended, the regulatory burdens on small businesses could have been reduced, and small businesses could have been saved considerable trouble in fighting unwarranted rulemaking actions. For instance, with input from the small business community early in the process for their 1997 temporary regulations on the uniform capitalization rules, the IRS could have taken into consideration the adverse effects that inventory accounting would have on farming businesses, and especially nursery growers. Similarly, if the IRS had conducted an Initial Regulatory Flexibility Analysis, it would have learned of the enormous problems surrounding its limited partner regulations prior to issuing the proposal in January 1997. These regulations, which became known as the ``stealth tax regulations,'' would have raised self-employment taxes on countless small businesses operated as limited partnerships or limited liability companies, and also would have imposed burdensome new recordkeeping and collection of information requirements.
Specifically, the bill strikes the language in section 603 of title 5 that limits inclusion of IRS interpretative rules under the Regulatory Flexibility Act, ``only to the extent that such interpretative rules impose on small entities a collection of information requirement.'' The Treasury Department has misconstrued this language in two ways. First, unless the IRS imposes a requirement on small businesses to complete a new OMB-approved form, the Treasury Department contends that the Regulatory Flexibility Act does not apply. Second, in the limited circumstances in which the IRS has acknowledged imposing a new reporting requirement, the Treasury Department has limited its analysis of the impact on small businesses to the burden imposed by the form, ignoring the more substantive and complicated burdens. As a result, the Treasury Department and the IRS have turned Regulatory Flexibility Act compliance into an unnecessary, second Paperwork Reduction Act.
To address this problem, our bill revises the critical sentence in section 603 to read as follows:
In the case of an interpretative rule involving the internal revenue laws of the United States, this chapter applies to interpretative rules (including proposed, temporary and final regulations) published in the Federal Register for codification in the Code of Federal Regulations.
The remaining provisions of our bill address the mechanics of convening a Panel and the selection of the small-entity representatives invited to submit advice and recommendations to the Panel.
Coverage of the IRS under the Panel process and the technical changes I have just described are strongly supported by the Small Business Legislative Council, the National Association for the Self-Employed, and many other organizations representing small businesses. Even more significantly, these changes have the support of the Small Business Administration's Chief Counsel for Advocacy.
Our mutual goal is to ensure that the views of small entities are brought forth through the Panel process and taken to heart by the
``covered agency''--in short, to continue the success that EPA and OSHA have shown this process has for small businesses. I thank the Senator from Massachusetts for his support, and I look forward to seeing the Small Business Advocacy Review Panel Technical Amendments Act of 1999 signed into law at the earliest possible date.
Mr. HAGEL. Mr. President, I ask unanimous consent that the committee amendments be agreed to, the bill be read a third time and passed, as amended, the motion to reconsider be laid upon the table, and that any statements relating to the bill be printed in the Record.
The PRESIDING OFFICER. Is there objection?
Without objection, it is so ordered.
The committee amendments were agreed to.
The bill (S. 1156), as amended, was read the third time and passed.
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