The cost of regulations often fall heaviest on small manufacturers – who have to pay $34,671 per employee in compliance costs. That’s three times more than other small businesses. However, the Small Business Regulatory Flexibility Improvements Act (H.R. 33 and S. 584) would ensure that federal agencies consider the impact of their rules on small businesses.

Please join the National Association of Manufacturers (NAM) in sending Congress a strong unified message from the manufacturing community in support of the bill, which is critical to the ongoing success of small and medium-sized manufacturers and businesses.

This important effort would be boosted by your organization’s voice. I hope you will join us.

This letter is open to all business and industry associations, state and local chambers and allied organizations.

The deadline for joining this letter is Friday, March 31, 2017 by 5:00pm EDT. Please add your organization’s name today!

Thank you in advance for your support. If you have questions, please contact NAM’s Director, Legal & Regulatory Policy Erik Glavich at eglavich@nam.org or (202) 637-3179.

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Letter to Congress in Support of the Small Business Regulatory Flexibility Improvements Act

April 3, 2017

U.S. Senate/U.S. House of Representatives
Washington, DC 20510

Dear Senator/Representative

We are writing to express our support for H.R. 33/S. 584, the Small Business Regulatory Flexibility Improvements Act of 2017, introduced by Senator James Lankford (R-OK)/Representative Steve Chabot (R-OH). This bipartisan legislation would reform the regulatory process to ensure that all federal agencies appropriately consider the impact of their rules on small businesses across America. As a result, federal agencies would issue smarter regulations that minimize inefficiencies and unnecessary burdens while still protecting public health, worker safety and the environment.

Small businesses are the backbone of the nation’s economy. According to the U.S. Census Bureau, there were over 28.8 million small businesses in 2013 employing 57 million workers, almost half of all private sector employees. These firms are responsible for about 60 percent of all net new jobs from 2010 through 2013, yet they are disproportionately impacted by compliance burdens associated with regulation. Small businesses with less than 50 employees pay $11,724 per employee per year in regulatory compliance. For small manufacturers, the compliance cost per employee triples to $34,671. The ability of small businesses to operate efficiently and free of unnecessary regulatory burdens is critical for competing and creating jobs. The Act directly addresses that small business challenge.

H.R. 33/S. 584 would improve and modernize the Regulatory Flexibility Act (RFA), a 1980 law that requires federal agencies to transparently account for the impact of regulation on small businesses. However, each agency interprets important terms in the existing statute in widely divergent ways and is able to avoid the RFA’s requirements as Congress intended. This bill would streamline and make uniform those determinations of when the RFA would apply to a rule.

Despite limited adherence by federal agencies to the RFA’s provisions, the RFA has yielded billions in savings for small businesses. In fiscal year 2016, the U.S. Small Business Administration’s Office of Advocacy reported compliance cost savings of $1.4 billion for small businesses. The office has saved businesses cumulatively $130 billion in regulatory costs since it began tracking regulatory cost savings in 1998. These savings were derived from a small number of regulatory alternatives that were less costly to small businesses. If all federal rules with small business impacts included the type of analysis required by this legislation, the savings could be significantly higher and our regulatory system could more efficiently meet our objectives.

Many rules that have significant impacts on small entities are not covered by the RFA because the small businesses adversely impacted are not directly regulated entities. The Act would require agencies to consider the true impact of their rules on the regulated community. It also would give the Office of Advocacy additional authorities to ensure agencies appropriately conducting a regulatory flexibility analysis during the rulemaking process. H.R. 33/S. 584 improves transparency and ensures that agencies thoughtfully consider the impact of regulations on small businesses.

The organizations represented on this letter cover virtually every sector of the small business community. The Small Business Regulatory Flexibility Improvements Act would help alleviate unnecessary regulatory burdens placed on small businesses. We urge your support for this commonsense bipartisan legislation.

Sincerely,