Congressional Record, Volume 142 Issue 38 (Tuesday, March 19, 1996)

[Congressional Record Volume 142, Number 38 (Tuesday, March 19, 1996)]
[Senate]
[Pages S2309-S2322]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

SMALL BUSINESS REGULATORY FAIRNESS ACT OF 1995

The PRESIDING OFFICER. Under the previous order, the clerk will
report S. 942.
The assistant legislative clerk read as follows:

A bill (S. 942) to promote increased understanding of
Federal regulations and increased voluntary compliance with
such regulations by small entities, to provide for the
designation of regional ombudsmen and oversight boards to
monitor the enforcement practices of certain Federal agencies
with respect to small business concerns, to provide relief
from excessive and arbitrary regulatory enforcement actions
against small entities, and for other purposes.

The Senate resumed the consideration of the bill.

[[Page S2310]]

Mr. BINGAMAN. Mr. President, I intend to support the small business
regulatory fairness bill, S. 942, as modified by the managers'
amendment.
This bill is a testament to the good work that occurred at the White
House Conference on Small Business organized here in Washington last
June. This national conference was the final step in a grassroots
public discourse about small business needs and concerns that involved
more than 21,000 small business people participating in 59 State
conferences across the country. Starting with more than 3,000 issue
recommendations at the State level, regional groups shaved the list to
a set of 293 concerns. And finally, the White House Conference focused
on 60 specific recommendations that might substantially improve the
environment for the growth and success of small business activity.
I think that the work of the White House Conference has given us a
good roadmap of items to debate and discuss which directly impact our
Nation's economic health. One of the major concerns of small business
owners today is simply complying with Federal regulations, being able
to understand the regulations--which are often extraordinarily complex,
and not falling subject to arbitrary enforcement and penalties. It is
important that our Government be accountable to those it governs and
must avoid arbitrary and ad hoc enforcement.
Mr. President, this legislation requires that Federal agencies
produce small entity-compliance guides that outline in simple,
understandable language what is required from small businesses. This is
a commonsense adjustment in which both Federal regulators and small
firms win. Furthermore, this act creates five-person regional citizen
small business review boards in each of the 10 Government regions
covered by the Small Business Administration. This measure gives small
business a voice at the table when Federal guidelines are discussed,
and this is as it should be.
Also central to this act is the creation of more cooperative and less
punitive regulatory environment between agencies and small business
that is less threatening and more solution-oriented than we have
achieved in the past. And equally important are provisions in this
legislation making Federal regulators more accountable for enforcement
actions by providing small businesses a meaningful opportunity for
redress of excessive or arbitrary enforcement activities.

As our Nation's larger firms continue a process of downsizing,
restructuring, and outsourcing, our small business sector will continue
to grow rapidly and will continue to be the major jobs generator for
the country. It is crucial that the Federal Government do what it can
to help small businesses thrive in a regulatory environment that is
well defined and user friendly rather than to suffer because of
uncertainty and unclear codes.
I am frequently visited by small business people and groups from my
own State of New Mexico and am very much pleased by their attention to
the debates that occur in Washington about legislation that might
impact them and their companies. These firms typically don't have a
staff section designed to study the tax implications of everything we
do here in this Chamber; nor do they have the time and personnel to
devote to close monitoring of our legislative activities. But still,
tens of thousands of small business people in the Nation do invest time
and become personally involved with the legislative process and have
committed themselves to improving the interaction between Government
and the small business sector.
I would like to mention one example from New Mexico, a person who
demonstrates well a combination of entrepreneurial excellence,
community concern and strong civic involvement. Ioana McNamara, the
president and founder of an Albuquerque-based small business called
Wall-Write, was one of those who participated from New Mexico in the
White House Conference on Small Business. I want to publicly commend
her for getting involved and working on these issues. She and others
from the New Mexico small business delegation, including another small
business person--Diane Denish--who served as the delegation chair for
the White House Conference--have done a great deal to make sure that
small firms in New Mexico do their part to achieve a more productive
relationship between Government and business.
Clearly, people like Ioana McNamara and Diane Denish have more than
enough to do in growing their businesses without paying attention to
whether this Chamber is about to do something that harms or helps their
businesses--but they have decided to do what they can to help implement
the measures decided on at the White House Conference. I think our
Nation should express its gratitude to these people and the thousands
of others who participate in the making of good policy.
Mr. KERRY. Mr. President, the Small Business Regulatory Enforcement
Fairness Act, represents an opportunity to change not only the
regulatory burden on small business, but more importantly, to begin to
change the way all Federal agencies, including the Internal Revenue
Service [IRS], deal with small business. I am pleased to be a cosponsor
of the bill.
In far too many cases, the Federal Government has acted as the judge,
jury, and executioner for small businesses. Testimony before the Small
Business Committee indicated many small businesses fear agencies like
the IRS will levy huge fines on them for failure to comply with minor
rules and regulations--of which they may be entirely ignorant. The
Federal Government must become a partner in the growth and development
of small businesses, not an adversary.
While not perfect, this legislation includes a number of provisions
which will ease regulatory burdens and give small businesses some
recourse when Federal bureaucrats are over zealous in the exercise of
their power.
The bill requires agencies to publish in plain English a guide to
assist small business in complying with regulations. Federal
regulations are often too difficult for anyone to understand, let alone
a small businessperson who is trying to run his or her business. It
will also allow Small Business Development Centers to offer assistance
to small businesses in complying with Federal regulations.
The bill would also establish an ombudsman to help small businesses
get fair and legal treatment from the Government if they have been
treated unfairly. The ombudsman would also assist small businesses in
recovering legal fees as a result of unfair Government actions.
Under the bill, Federal agencies would be required to waive civil
penalties for first violations by small businesses that do not
constitute a serious threat to public health, safety, or the
environment.
The bill provides that small business representatives are to be
consulted in Federal agency rulemaking decisions that would have a
significant impact on small businesses so that small business interests
would be considered at the outset in the development of regulations.
While these reforms will not end the difficulties many small
businesses face in complying with Federal regulations, they should help
ease the burden. I hope this legislation will mark the beginning of a
new era of better relations between Government and small business. The
Federal Government should be working in partnership with small
businesses--not at cross-purposes with them.
I am proud to support this legislation and would like to thank the
chairman of the Small Business Committee, Senator Bond, and the ranking
member Senator Bumpers along with their staffs for their effort in
producing this legislation.
Mrs. MURRAY. Mr. President, I would like to take this opportunity to
commend Senator Bond for his leadership on small business issues, and
lend my support to the Small Business Regulatory Fairness Act, which
will lessen regulatory burdens imposed on small businesses by Federal
agencies.
Mr. President, I have talked with many small business owners in my
home State and one thing they all tell me is how difficult and costly
it has become to comply with many of the Federal regulations imposed
upon the. Among other things, this legislation will require agencies to
publish materials in plain language to help small businesses comply
with regulations.

[[Page S2311]]

The bill will also enhance the small business communities' voice with
the Small Business Administration by providing them a role in
determining future regulations.
When I was growing up, my father ran a small business in Bothell, WA.
I know the time and energy small business people put into their
companies. And, throughout my term, I have worked to reform a
Government that continues to hamper small business owners.
I was a cosponsor of the S-Corporation Reform Act of 1993, and
returned as a cosponsor of S. 758 last year, which would remove
obsolete provisions from the tax code, making it easier for small
businesses to raise capital. I cosponsored the Family Health Insurance
Protection Act which would provide health insurance market reform for
small businesses and families. And, on the first full day of this
Congress, I introduced the American Family Business Preservation Act
which would reduce the rate of estate tax imposed on a family owned
business, encouraging families to keep their businesses intact. And, as
many of my colleagues will remember, last Congress, we fixed a problem
that has been plaguing small businesses that wanted to refinance their
SBA 503 loans. Now, many small businesses in Washington State and
across the country will be able to refinance their 503 loans.
Mr. President, I strongly believe Government cannot solve every
problem in this country, but it can foster a healthy economic
environment in which all businesses may prosper. I encourage each of my
colleagues to support S. 942. The Small Business Regulatory Fairness
Act continues our work by reducing redtape and making it easier for our
small businesses to comply with often burdensome Federal regulations. I
believe this is the type of reform our small businesses want and
deserve.
Mr. GLENN. Mr. President, I support the managers' amendment to S.
942, the Small Business Regulatory Enforcement Fairness Act. I have
been a long supporter of regulatory reform, and I believe this
legislation provides significant regulatory relief to small businesses,
small governments, and other small entities.
I congratulate the managers of this bill--Senator Bond, chairman of
the Small Business Committee, and Senator Bumpers, Ranking Democrat on
the committee--for their efforts to craft a workable bill. I know they
have consulted frequently with other members, the small business
community, and the administration to address concerns and improve the
legislation. In the midst of contentious debate about other regulatory
reform issues, Senator Bond and Senator Bumpers have put together a
regulatory reform bill that will provide significant relief to small
business. This legislation should get broad bipartisan support in both
the Senate and House, and I am sure will soon be signed into law.
The purposes of this legislation are important and I support them.
Some of the details, however, still concern me. For example, the bill
provides for judicial review of Regulatory Flexibility Act decisions.
This will put needed teeth into the Reg Flex Act and ensure that
agencies prepare required regulatory impact analyses and pay more
attention to the special impact of their rules on small business and
other small entities, such as local governments. I am concerned,
however, that these judicial review provisions may be overly broad and
will lead to unnecessary litigation. Only time will tell whether my
concern is well founded. At this point, I am prepared to give the new
provisions the benefit of some doubt.

The bill also establishes a small business ombudsman process to help
improve cooperation between regulatory agencies and regulated
businesses. I support this idea. But, I am concerned that the
implementation process, with its Small Business Fairness Boards, will
end up creating a one-sided record of complaints that will distort the
broad public mission of our agencies. Our agencies should not be viewed
as the enemy when they carry out the laws passed by the people's
representatives in Congress. I am happy, at least, that in the final
version of the bill before us, the Ombudsman will focus on general
agency enforcement activity and not attempt to evaluate or rate the
performance of individual agency personnel.
Finally, the legislation creates small business review panels to
ensure that small business perspectives are fully considered by
agencies during rulemaking. Again, I support the important purpose of
ensuring that agencies hear the voices of the little guys who do not
always get through the maze of agency process and the larger more
organized commenters. It is, however, important to ensure that this
opportunity for comment does not create a precedent of giving special
leverage to one segment of the public. I am, at least, heartened by the
fact that review panel comments on an agency proposed rule will go into
the public record, and that other interested parties will have an
opportunity to respond to those comments before the agency makes its
rulemaking decision. The fact that these review panels, as well as the
Fairness Boards, will be subject to the Federal Advisory Committee Act
[FACA] and the Government in the Sunshine Act will also help ensure
that the new process will be open to the public.
On balance, I believe the managers' amendment should be supported.
Again, I commend Senator Bond and Senator Bumpers for their openness to
concerns about the bill. Since we first saw drafts a week or so ago,
significant changes and improvements have been made. Given these
changes, I will vote for the managers amendment. But given my concerns,
let me also say that these provisions should not be modified by the
House. If they are made more onerous, then they should not be
supported. If House action leads to changes in conference, then the
Senate should say no to the conference report.
Let me clear up one fact about this legislation. A week and a half
ago, on Thursday, March 7, 1996, Senator Bond stood here on the floor
and described his hopes for a bipartisan agreement on this legislation.
Our Minority Leader, Senator Daschle, agreed, saying that Democrats
hoped to provide broad, if not unanimous, support for the final bill.
Unfortunately, several other of our colleagues on the other side of the
aisle then went on to accuse Democrats of delaying the bill and even of
engaging in a filibuster. That could not be further from the truth.
When the Small Business Committee considered the legislation on
Wednesday, March 6, there was general agreement that a managers'
amendment would be prepared for the bill. On the 7th, as we waited to
see the proposed amendment, we were surprised to hear our Republican
colleagues accusing Democrats of holding up the bill. As it turned out,
I did not see the final proposed manager's amendment for another whole
week--March 14, an entire week after Thursday the 7th. Far from
Democrats holding up this legislation, the fact is that the managers of
this bill were not ready to bring the bill to the floor until at least
a full week after we were being accused of delay. I am definitely not
criticizing the managers. Their careful deliberations are to be
commended. But certainly, other Senators should not be falsely accused
of delaying the bill, when they were only waiting to see the results of
those deliberations.
I hope I have set the record straight. There was never a filibuster
on this legislation. We are happy there is finally an agreement on the
managers' amendment. We are pleased that we now have it and can move
forward and quickly pass the legislation.
I must say though, that once again, I am very disappointed in the
rhetorical excesses of my colleagues on the other side of the aisle.
Rather than even admit to working cooperatively, which is the case with
the bipartisan bill before us, they tried to mislead the public about
the status of this legislation. There certainly are enough instances
where we honestly disagree, but here where we are working together,
there is nothing to disagree about.
We need more of the bipartisan cooperation seen in the work of
Senators Bond and Bumpers and the other members of the Small Business
Committee on this legislation. We need much less of partisan sniping.

The Nickles-Reid Congressional Review Amendment

S. 942 comes to the floor with an agreement to consider one other
amendment. This is the Nickles-Reid Congressional Review legislation
and I urge my colleagues to support this

[[Page S2312]]

amendment. We passed this legislation last year, as a substitute to the
Regulatory Moratorium. Congressional Review will create more work for
us, but its expedited legislative veto process will ensure
congressional accountability for Federal agency rules. I believe we
need this process so that we can do our part for regulatory reform.
I have always been struck when in hearings, agency officials--under
successive administrations--have pointed out that most agency
regulations are strictly required by laws passed by Congress. The
Nickles-Reid Congressional Review process will close the loop, so that
when an agency issues a rule that some may oppose, we will have an
opportunity to consider it in the context of the law and determine its
reasonableness. This will not only help with accountability for
individual rules, but will also help us identify specific statutory
provisions that need revision. For these reasons, I am happy to support
the Nickles-Reid amendment, and urge my colleagues to do so, as well.

CONCLUSION

With the combination of Small Business Regulatory Fairness and
Congressional Review, we have significant bipartisan regulatory reform
legislation. It should be passed by the House and be signed into law by
the President.
Our job as legislators is to create laws that can work and can
improve conditions in our country. Some have wanted to bull through and
legislate now on a larger regulatory reform package. The truth is that
there is simply too much there that is unsettled and about which too
many do not agree. Now is the time to move legislation that can work
and that will improve the regulatory process.
If in the quiet of committee we can return to the other regulatory
reform issues of cost-benefit analysis and risk assessment, I think we
should. But for now, let us work together on bills such as the
legislation before us today that can pass and should pass.
Mr. LAUTENBERG. Mr. President, I rise in support of S. 942, the Small
Business Regulatory Enforcement Fairness Act.
Mr. President, America's small businesses badly need relief from
excessive and unnecessary regulations. For years, those of us on the
Small Business Committee have heard first hand from men and women in
small businesses about the disproportionate regulatory burden they
face. This burden was confirmed late last year in a report by the Small
Business Administration's Office of Advocacy. Among other things, the
report found that while small businesses employ 53 percent of the
workforce, they bear 63 percent of total business regulatory costs.
The annual average cost of regulation, paperwork, and tax compliance
for small businesses is about $5,000 per employee. By contrast, the
comparable burden for businesses with over 500 workers is $3,400 per
employee. This difference is significant. Big businesses already enjoy
a competitive advantage over their smaller counterparts because of
economies of scale. The Federal Government should not further
disadvantage small businesses by imposing uniform regulations where
tiering the regulation to account for business size would be just as
effective.
Mr. President, the bill before us will give teeth to the Regulatory
Flexibility Act Congress passed in 1980. That act, known as the Reg
Flex Act, requires agencies to assess the effects of their proposed
rules on small entities. Based on this assessment, agencies either have
to conduct a regulatory flexibility analysis describing the impact on
small entities, or they must certify that their rule will not have a
significant economic impact on a substantial number of small entities.
Despite Congress's best intentions, agencies all too often have
refused to comply with the Reg Flex Act. Unfortunately, there is
nothing small businesses can do currently to enforce compliance. S. 942
would correct this problem. The bill would enable small businesses to
take agencies to court to challenge an agency's determination. This
should provide the spur necessary to ensure much greater compliance in
the future.
In addition, this bill will require agencies to publish compliance
guides for small businesses. In the study commissioned by SBA, 94
percent of small businesses said that it was unclear what they had to
do to be in compliance with regulations. By providing easily understood
explanations of regulations, agencies will ensure greater compliance.
In addition, the bill directs agencies to provide informal guidance to
small businesses about what is required of them to be in compliance.
In the case of regulations for which a regulatory flexibility
analysis is required, small businesses will now be part of the
rulemaking process by providing advice and recommendations to agencies
before proposed and final rules are issued. To further help small
businesses make their way through complicated regulations, the bill
permits Small Business Development Centers and Manufacturing Technology
Centers to offer regulatory compliance assistance and onsite
assessments for small businesses.
Finally, Mr. President, S. 942 makes it easier, in certain instances,
for small businesses to obtain attorneys fees from the government for
claims upon which they prevail. I had serious concerns about the
language we considered in the Small Business Committee mark up, which
modified the so-called Equal Access to Justice Act. I did, however,
have the assurance of the Senator from Missouri that our offices would
change these provisions so that we would not be rewarding companies
with attorneys fees when they violated the law, because, for example,
they prevailed on 1 of 10 claims. I believe the new language contained
in sections 301 and 302 accomplishes the goal of aiding firms that had
to fight the Government on meritless suits, while protecting taxpayers
from paying the attorneys fees for companies that have broken the law.
Mr. President, I want to commend Senator Bond and his staff for their
willingness to adopt recommended changes suggested by myself and other
members of the Small Business Committee. Most Members of this body
express their desire to work with their colleagues across the aisle,
but those expressions often prove hollow. In this case, however, I am
happy to say that S. 942 is truly a bipartisan bill and I hope we will
have many more such bills before the end of the 104th Congress.
I also want to acknowledge the work of the Clinton Administration's
``Reinventing Government'' initiative and last year's White House
Conference on Small Business. Their efforts laid the groundwork for the
legislation we are considering today.
Again, I want to thank Senator Bond and Small Business Committee
staffers Keith Cole and John Ball for their assistance on this
legislation, and I hope my colleagues will join me in supporting S.
942.
Mr. MURKOWSKI. Mr. President, no one more strongly supports the goals
sought by the statutes and regulations of this country than I do.
I come from a beautiful State blessed with resources that I have
worked to see used productively and conserved wisely, I myself enjoy
the great outdoors in Alaska, along with my family, and intend to have
these same kinds of experiences enjoyed by my children and
grandchildren; I have been a banker, where it has been my privilege to
see individuals succeed in small business; I have seen first hand how
issues like safety and worker protection go hand in hand with ensuring
that success, but there is no doubt that achieving better protection of
human health and the environment can only happen if we regulate
smarter.
Individuals and businesses, big and small, spend too much time trying
to comply with too much paperwork, and too much regulation from too
many Washington bureaucrats. For example: above-ground storage tanks
must comply with five different regulations that each require a
separate spill prevention plan; this means that a business with tanks
files five different sets of plans--one to the State, and two each to
the EPA and the Coast Guard.
If you buy a business that was once registered to produce pesticides,
even if you don't produce pesticides, or never have, the EPA will still
want you to send in annual production reports with zeros filled in. If
you don't, you can be sued and potentially fined. For just one statute,
the Resource Conservation and Recovery Act, EPA has issued 17,000 pages
of regulations and proposed regulations. The volume I'm holding has
over 1,000 pages, and on any one of

[[Page S2313]]

them is a place where a small business can get tripped up. By the way,
this is one volume of title 40 of the Code of Federal Regulations.
Title 40 deals with environmental protection. Title 40 has 20 more
volumes like this one. And its only title 40.
The Code of Federal Regulations occupies an entire 4 foot by 8 foot
bookcase in the Senate library. A copy of the code costs almost $1,000,
and is updated four times a year. Even if a small business could afford
to buy it, it would be impossible to read it all. Why do we want to
force every business in America to have to keep a battery of lawyers
around just to advise about the overwhelming details in the Code of
Federal Regulations?
Now, usually when I describe these examples, I talk about Anchorage,
AK. There, fish guts were added to the waste water to comply with
regulations that require a certain amount of organic waste removed
during sewage treatment. The water was too clean, so material had to be
added just to comply with the requirement to get a minimum amount out.
But I am happy to say that today I am no longer using that example. It
seems that in response to a lawsuit, EPA announced its intention to
lift some of the restrictions on sewage treatment plants such as the
one in Anchorage.
EPA states, ``This change would provide the affected municipalities
with additional flexibility and, in some cases, cost savings without
compromising environmental quality.''
If we are to move forward to a safer, cleaner, healthier future, we
have to change the way Washington regulates. This bill is a positive
and helpful step in that direction. S. 942 will ensure small business
participates in rulemaking. This in turn will mean that rules will take
small business needs into consideration before a rule is enacted. The
bill also allows judicial review of regulations for compliance with the
16-year-old Regulatory Flexibility Act. A court can now examine whether
agencies considered adverse impacts to Small Business when it writes
regulations, and determine if an agency acted in an arbitrary manner.
Penalty waivers and reductions when appropriate for small business
violations. Recovery of attorney's fees when small business is forced
into defensive litigation due to enforcement excesses. Comprehensive
regulatory reform will continue to be a high priority for this Senator.
As science and technology continue to change, we must have a Federal
Government that can be responsive to such changes. We need to plan for
the future, not just for today, and that means a regulatory system that
can keep up with improvements.
Four fundamental changes to the regulatory system will have to occur
to ensure those improvements in the future. First, we must do a
thorough review of existing regulations in place, decide what we need
and what we don't, and avoid adding any more we don't need; second,
Washington should be required to disclose the expected cost of current
and new regulations. The public has a right to know what laws and
regulations cost; third, when making regulatory decisions, the
Government should use best estimates and realistic assumptions rather
than worst case scenarios advanced by extremists; and fourth, new
regulations should be based on the most advanced and credible
scientific knowledge available.
Common sense must be returned to regulating. I applaud Senators Bond
and Bumpers, and all those who worked to bring this bill to the floor.
It is an important first step toward a safer, cleaner, healthier
future.
Mr. WELLSTONE. Mr. President, I am very pleased to vote for this
bill, reported out of the Small Business Committee 2 weeks ago. I
commend Chairman Bond for moving the bill through our Committee, as
well as ranking member Senator Bumpers. I appreciate the cooperation of
both in working with me and my staff to help ensure that the easing of
regulatory burden accomplished in this bill, which is needed and
desirable, will not turn back the clock in the area of necessary
enforcement of worker safety laws and regulations when there are
serious violations.
The bill provides judicial review for agency actions under the
Regulatory Flexibility Act. And it would require agencies to publish
plain-English compliance guides to help small business meet Government
rules. I appreciate that the Senate is taking this positive, bipartisan
action in the area of regulatory reform policy with a bill that came
from the Small Business Committee. It brings badly needed common sense
to regulations affecting small businesses.
Mr. President, it is important that we take this step on a key item
from the agenda of the White House Conference on Small Business.
Minnesota delegates to the White House Conference selected this issue,
as expressed in a Conference resolution, to be one of their top
priorities.
Mr. STEVENS. Mr. President, I strongly support the Small Business
Regulatory Enforcement Fairness Act. Small business is overloaded with
unreasonable regulatory requirements and paperwork. We are long overdue
in doing something about it.
This legislation will help small business in several major ways.
First, it provides judicial review of the Regulatory Flexibility Act to
ensure that agencies will consider the impact of regulations on small
businesses, small towns, and nonprofit organizations. The Reg-Flex Act
has been on the books for 16 years, but agencies have ignored it
because it could not be enforced in court. We are putting an end to
that.
Second, this legislation helps small business to participate in the
federal regulatory process. Third, it provides an opportunity for small
businesses to redress arbitrary Government enforcement actions.
In addition, Senator Nickles is adding a provision that would allow
Congress to review new rules under expedited procedures. This can
provide redress for both big and small business, governments, and non-
profit organizations. If a rule is unreasonable, Congress will have an
opportunity to veto it.
Mr. President, small business is critical to the well-being of the
country and my home State of Alaska. Over 99 percent of Alaska's
businesses are small businesses. They are the largest employers of
minorities, women, and youth in Alaska. Alaska boasts a higher
percentage of women-owned businesses than any State. Small business
creates new jobs, is a crucial source of entrepreneurial innovation,
and makes the American dream a reality for countless Americans.
Federal bureaucrats must be more sensitive to the devastating impact
that overregulation can have on small business. About 65 percent of
Alaska's small businesses employ one to four employees. Many could
drown unless we stem the rising tide of federal rules and redtape. I
congratulate Senator Bond and my other colleagues who have promoted
this important legislation.

small business review panels

Mr. GLENN. Let me make sure I understand how the Small Business
Review Panels will work. Before the publication of an initial
regulatory flexibility analysis for a proposed EPA or OSHA rule, the
SBA's Chief Counsel for Advocacy will gather information from
individual representatives of small businesses, and other small
entities such as small local governments, about the potential impacts
of that proposed rule. That information will then be reviewed by a
panel composed of members from EPA or OSHA, OIRA, and the Chief
Counsel. The panel will then issue a report on those individual's
comments, which will become part of the rulemaking record. Then, after
the proposed rule is published in the Federal Register and prior to the
publication of a final regulatory flexibility analysis, a second review
panel will be convened, and again it will review and report on the
individual's comments on the proposed rule. Is this correct?
Mr. BOND. Yes; my colleague from Ohio has correctly summarized the
review panel process.
Mr. GLENN. Good, now let me ask specifically with regard to the first
review panel stage: I trust that it is the managers' intention that the
review panel's report and related information be placed in the
rulemaking record in a timely fashion so that others interested in the
proposed rule may have a reasonable opportunity to review that
information and submit their own responses to it before the close of
the agency's public comment period for the proposed rule.

[[Page S2314]]

Mr. BOND. That is correct.
Mr. GLENN. Good. Now, let me ask about the second review panel stage:
I trust that it is the managers' intention that should an agency decide
to significantly modify a proposed final rule on the basis of the
panel's report, the agency will reopen the rulemaking proceeding and
allow public comment on the newly revised proposal. I believe that not
to do so would be to overturn longstanding rules against ex parte
communications. Again, securing meaningful input from small entities
should not be at the price of undercutting the openness and fairness of
the Government decisionmaking process.
Mr. BOND. I agree. Again, our purpose is to ensure that the concerns
of small business and other small entities be fully and carefully
considered by rulemaking agencies. If those concerns lead to a
significant change in the regulatory proposal, the process should be
reopened to allow all interested parties to comment on the revised
proposal.
Mr. GLENN. I thank the Senator very much. I am glad that we agree on
how this process will work.
Mr. LEVIN. Mr. President, one of the proposals we have before us, in
S. 942, would establish an ombudsman in the Small Business
Administration. That ombudsman would solicit information from small
businesses on Federal regulatory enforcement practices and develop
ratings of how well Federal agencies perform their enforcement duties.
The ombudsman would have the ability to refer serious cases of abuse to
an agency's inspector general.
This provision seeks to make regulatory agencies more responsive to
the concerns of small businesses by giving small businesses a means to
respond to excessive regulatory enforcement practices. While I firmly
believe that we need to fight for fundamental change in the culture of
small business regulation, I question whether this proposal, although
well-intentioned, is the best catalyst for affecting that change.
I am concerend that the Small Business Committee did not fully
consider other options that could provide a better mechanism for giving
small businesses a stronger voice within agencies that regulate them.
In particular, I think the committee should have taken more time to
look at the pros and cons of placing an ombudsman in each regulatory
agency, rather than relying on a lone ombudsman in the Small Business
Administration to cover all agencies.

I have been working for the past several months on a proposal that
would create an office of ombudsman in each major regulatory agency. My
proposal would give the ombudsman sufficient authority within the
agency to solve problems and sufficient independence from the
regulatory structure to act fairly. The ombudsman would be the mediator
or honest broker between the small business who is the subject of an
inspection or enforcement action and the regulatory apparatus of the
agency.
This was a recommendation of the Administrative Conference of the
United States back in 1990, and I think it makes a lot of sense. I
believe that much of the dissatisfaction of the regulated public with
regulations is not only with the content of some of our regulations but
also with the way in which they are enforced. Agencies often view a
small business as a violator to be caught instead of as a company to be
helped into compliance. And that's a big difference. The ombudsman
would be there to put a friendly place--the spirit of cooperation--on
the implementation of regulatory requirements.
I agree that we need to give small businesses a stronger voice in the
agencies that regulate them, but we must make sure that agencies are
ready and willing to listen. That's why we need to consider placing an
ombudsman in each agency and not just rely on a single ombudsman in the
Small Business Administration.
Mr. President, I have a number of concerns about placing a lone
ombudsman in the Small Business Administration.
First, the ombudsman would be responsible for soliciting comments
about and developing ratings of programs and offices in each Federal
agency that regulates the small business community. Carrying out this
responsibility would require the ombudsman to become familiar with the
operations of hundreds of programs in dozens of agencies. That's just
not a reasonable expectation.
Second, ombudsmen have traditionally been neutral officials who field
complaints and recommend solutions to individual disputes between the
Government and the regulated public. The broad jurisdiction of the
office proposed in this bill would prohibit the ombudsman from focusing
on the day-to-day problems small businesses face in dealing with agency
regulators. The EPA Small Business ombudsman fields thousands of such
inquiries every year, and that's just for one agency. Rather than
investigating and mediating individual disputes himself or herself, the
ombudsman would have to refer alleged cases of agency misconduct to the
inspector general of the relevant agency.
In other words, the ombudsman wouldn't receive information for the
purpose of mediating disputes, solving problems, and fostering
collaboration between agencies and regulated parties. Instead the
ombudsman would receive information primarily for assessing agency
performance. That doesn't help get immediate and specific problems
solved.
At the hearing on S. 942 in the Small Business Committee, several
representatives of the small business community said that they would
prefer to have a single ombudsman in the Small Business Administration
rather than an ombudsman in each individual regulatory agency. They
argued that agency ombudsmen could be influenced by internal agency
politics and that, because of this, small businesses would be
susceptible to intimidation by regulators if they came forward with
complaints. While I understand the reluctance of small businesses to
complain directly to an agency official about inappropriate regulatory
practices, I believe that ombudsmen in regulatory agencies can be given
sufficient independence from the regulatory structure to act fairly and
to assure regulated parties that their inquiries will not be used
against them.
One witness, Wendy Lechner from the Printing Industries of America,
made a point of praising the work of the Small Business Ombudsman at
the Environmental Protection Agency and recommended that such ombudsman
programs should be replicated throughout the regulatory agencies. The
EPA office is one of approximately half a dozen ombudsman offices
operating throughout the Federal Government that address disputes
between agencies and the regulated public. By and large, these
ombudsmen have improved communications between the agencies and
regulated parties, uncovered systemic problems and chronic abuses in
the regulatory process, and saved valuable resources through informal
dispute resolution that otherwise would have been wasted on the costs
of formal legal proceedings.
Mr. President, I do not think the ombudsman provision in S. 942
solves the enforcement problem for small businesses. I will continue to
work on legislation that would place an ombudsman in each regulatory
agency. I think such an approach would foster collaboration between
small businesses and the agencies that regulate them and achieve better
results.
I commend the chairman and ranking Democrat on the Small Business
Committee for their hard work on this bill and look forward to working
with them as my ombudsman proposal is developed.

the small business regulatory enforcement fairness act of 1996

Mr. DOMENICI. Mr. President, I know I do not have to tell you that
small businesses create most of the jobs in America. Small businesses
are the engine that keep the American economy running. I know that in
my State small businesses make up 85 to 90 percent of private
employers. In that regard, I have created a New Mexico small business
advisory board.
I have also participated in Small Business Committee field hearings
throughout my State. Indeed, I was privileged to have had the chairman
of the Small Business Committee, Senator Bond, come out to New Mexico
and hear from those New Mexico small businesses firsthand at a Small
Business Committee field hearing in Albuquerque.
Mr. President, what we found was that almost all of the small
business owners we talked to--who are the people who create almost all
of the private sector jobs in my State--told us just

[[Page S2315]]

how smothering the explosion in Federal regulations has become.
In particular, those small business owners identified the
Occupational Safety and Health Administration [OSHA] and the
Environmental Protection Agency [EPA] as the two Federal agencies which
promulgate the most unreasonable and burdensome regulations. Mr.
President, these small business painted a picture of the Federal
bureaucracy at its worst: arrogant, unresponsive, inefficient, and
unaccountable.
Further, Mr. President, because a great number of new businesses are
being started by women, some of the most vocal critics of EPA's and
OSHA's unreasonable regulations are women-owned businesses.
I believe one of the biggest reasons for these bureaucratic problems
is that small businesses are just not adequately consulted when
regulations affecting them are being proposed and promulgated. I am not
alone in this belief. In 1994 five agencies--including the Small
Business Administration, EPA, and OSHA--held a small business forum on
regulatory reform, and they came up with some conclusions about the
problems with the current regulatory process.
Let me quote from the administration's own report summarizing the
principal concerns identified at the forum:

Concern: ``The inability of small business owners to
comprehend overly complex regulations and those that are
overlapping, inconsistent and redundant;''
Concern: ``The need for agency regulatory officials to
understand the nuances of the regulated industry and the
compliance constraints of small business;''
Concern: ``The perceived existence of an adversarial
relationship between small business owners and federal
agencies;''

And finally, Mr. President, and I think most important:

Concern: ``The need for more small business involvement in
the regulatory development process, particularly during the
analytic, risk assessment and preliminary drafting stages.''

Mr. President, this is the agencies' own report on the problems with
the regulatory process.
During the floor debate on last year's regulatory reform bill,
Chairman Bond and I successfully added an amendment that would have
squarely addressed those concerns. That amendment had the support of
the National Federation of Independent Business, and was accepted by
the Senate. As we all know, however, the broader regulatory bill did
pass.
That is why I am so happy to have worked with Chairman Bond to ensure
that my small business advocacy panel initiative was included as a
section of the bill we are about to vote on today, the Small Business
Regulatory Enforcement Fairness Act of 1996. The small business
community has no greater champion than my good friend from Missouri,
and I am proud to be associated with his outstanding bill.
Mr. President, the structure and process of these advocacy panels is
as follows:
First, prior to publication of an initial regulatory flexibility--reg
flex--analysis, an agency would notify the Chief Counsel for Advocacy
of the Small Business Administration of potential impacts of a proposed
rule on small business.
Second, the Chief Counsel would identify individual representatives
of small business for advice and recommendations about the proposed
rule.
Third, the agency would convene a review panel consisting of
representatives of the agency, the Office of Information and Regulatory
Affairs, and the Chief Counsel, to review the information collected on
the impact of the proposed rule on small business.
Pursuant to the information obtained at the review panels, and where
appropriate, the agency shall modify its proposed rule.
Finally, the findings and comments of the review panel shall be
included as part of the rulemaking record.
This process shall be repeated prior to the final publication of a
reg flex analysis.
Remember, Mr. President, the agencies themselves have recognized that
small businesses are underrepresented during rulemakings. I believe
that these review panels, convened before the initial and the final reg
flex analyses, will ensure that small businesses finally have an
adequate voice in the regulatory process. In addition, these panels,
working together so all viewpoints are represented, will be the crux of
reasonable, consistent, and understandable rulemaking. Finally, Mr.
President, and perhaps most important, these panels will help reduce
counterproductive, unreasonable Federal regulations at the same time
they are helping to foster the nonadversarial, cooperative
relationships that most agree are long overdue between small businesses
and Federal agencies.
Mr. HELMS. Mr. President, the pending bill, S. 942, the Small
Business Regulatory Enforcement Fairness Act of 1996, deserves the
support of all Senators--and the able chairman of the Small Business
Committee, our good friend from Missouri, Mr. Bond, is to be commended
for his persistence.
This legislation is badly needed. In North Carolina literally
hundreds of small businesses are struggling under the heavy regulatory
burdens imposed by the Washington bureaucracy. These businesses are
seeing their profit margins gobbled up by oppressive Federal
regulations.
Mr. President, S. 942, will go a long way toward leveling the playing
field and giving small businesses some long overdue relief from a
portion of existing burdensome regulations. Small businesses now will
be better able to challenge burdensome regulations in the courts.
Federal agencies hereafter will be required to obtain the views and
opinions of small businesses before regulations are drafted, making
small businesses players before regulations are drafted and imposed.
Mr. President, Mary McCarthy in the October 18, 1958, New Yorker
Magazine observed, ``Bureaucracy, the rule of no one, has become the
modern form of despotism.''
How true, and I'm hopeful that both the Senate and the House will
pass this legislation, and that the President will sign it, because no
bureaucracy or bureaucrat should be permitted to be a despot over the
people they are supposed to be serving.

duties and functions of the ombudsman

Mr. LEVIN. One of the proposals put forward in S. 942 would establish
an ombudsman position in the Small Business Administration. The
proposal of the Senator from Missouri would provide a way to gather and
publicize information about how agencies across the board treat small
businesses in the regulatory enforcement process. I have concerns about
the language the bill uses to describe the duties and functions of the
ombudsman.
Specifically, I would like to ask the Senator from Missouri about
title II, section 30(b)(2) (A) and (C). In an earlier version of the
bill, these sections, which outline the duties of the ombudsman, stated
that the ombudsman shall

work with each agency with regulatory authority over small
businesses to ensure that small business concerns that
receive or are subject to an audit, on-site inspection,
compliance assistance effort, or other enforcement related
communication or contact by agency personnel are [provided
with a means to comment on and rate the performance of such
personnel],

and,

based on substantiated comments received from small business
concerns and the Boards, annually report to Congress and
affected agencies [concerning the enforcement activities of
agency personnel including a rating of the responsiveness to
small business of the various regional and program offices
and personnel of each agency].

This language appeared to direct small businesses and the ombudsman
to publish employment ratings of specific agency employees who carry
out regulatory enforcement actions. While the boards and the ombudsman
are specifically directed to report on substantiated actions of agency
personnel, I am concerned that this provision would have focused
attention inappropriately on public ratings of individuals rather than
on rating the performance of the agencies and agency offices. Such an
individual rating system could interfere with the employment
relationship between agencies and their employees.

The language of the bill before us today is somewhat different from
the earlier version. The current version of the bill states that the
ombudsman shall

[[Page S2316]]

agency personnel are [provided with a means to comment on the
enforcement activity conducted by such personnel],

and

based on substantiated comments received from small business
concerns and the Boards, annually report to Congress and
affected agencies [evaluating the enforcement activities of
agency personnel including a rating of the responsiveness to
small business of the various regional and program offices of
each agency].

While the current language still allows for comment on the
enforcement activities of agency personnel in order to identify
potential abuses of the regulatory process, it appears to remove the
mandate for the boards and the ombudsman to create a public performance
rating of individual agency employees. Senator Bond, is this
interpretation correct and, if so, was the change in language made in
order to focus the reports of the boards and the ombudsman on rating
overall agency performance rather than on rating individual regulators?
Mr. BOND. The Senator's interpretation of the change in language is
correct. My goal is to reduce the instances of excessive and abusive
enforcement actions. Those actions obviously originate in the acts of
individual enforcement personnel. Sometimes the problem is with the
policies of an agency, and we are very definitely trying to change the
culture and policies of Federal regulatory agencies. At other times,
the problem is really that there are some bad apples at these agencies.
It is for that reason that we specifically included a provision to
allow the ombudsman, where appropriate, to refer serious problems with
individuals to the agency's inspector general for proper action. The
ombudsman's report to Congress should not single out individual agency
employees by name or assign an individual evaluation or rating that
might interfere with agency management and personnel policies. The
intent of the bill is to give small businesses a voice in evaluating
the overall performances of agencies and agency offices in their
dealings with the small business community.
Mr. LEVIN. I thank the chairman of the Small Business Committee. This
is an important change and clarifies that the purpose of the
ombudsman's report is not to rate individual agency personnel, but to
assess each program's or agency's performance as a whole.
Mr. DASCHLE. Mr. President, passage of the Small Business Regulatory
Fairness Act will mark an important milestone in our efforts to provide
American business with reasonable, common sense regulatory relief. It
is a bill that should be passed by Congress and sent to the President
with dispatch.
This legislation, which was approved unanimously by the Senate Small
Business Committee, and which I expect will pass the Senate with
overwhelming bipartisan support, will provide much needed change in the
way Federal agencies deal with American small business. It acknowledges
that the Federal bureaucracy often chokes small business in red tape,
and institutes a number of reforms that will unleash their productive
energy without diminishing the Federal responsibility to protect the
public health and safety. Passage of this bill will send an important
message to small business owners across the country that their voice is
being heard in Washington, DC.
Small businesses already face a daunting array of challenges, from
the uncertain economic climate to the myriad daily paperwork burdens of
accounting, bookkeeping, and bill paying. The further burden of keeping
up with, and complying with, Federal regulations can discourage even
the most stalwart business men and women from striving to achieve their
dream of entrepreneurship.
The Federal Government has a responsibility to protect worker health
and safety, public health, and the environment. In that effort,
agencies issue regulations, but experience shows that many of those
regulations look good on paper, but don't work in the real world. This
bill acknowledges that fact and demonstrates our determination to both
confront and correct mistakes.
Federal agencies should be as sensitive as possible to the challenges
faced by small businesses in America, and I expect this bill will help
achieve that goal. Many of this bill's provisions were developed by
small business owners from South Dakota and across the country during
the White House Conference on Small Business last summer. No one knows
more about the risks and pitfalls associated with owning a small
business than businesspeople themselves. The White House conference
gave them a forum in which to discuss how the regulatory process could
be improved, and I am glad that Congress has taken to heart what they
had to say on this subject.
One of the most frequent criticisms I hear from small business owners
is that Federal agencies bring harsh enforcement actions against
businesses for relatively insignificant and unintentional violations of
Federal rules. This legislation responds to that concern by requiring
agencies to develop policies to waive fines for first-time, nonserious
violations.
The legislation also requires Federal agencies to publish easy-to-
read guidance for small business to comply with Federal rules and
creates a small business and agricultural ombudsman at the Small
Business Administration to provide a means to comment on agency
enforcement personnel and to develop a customer satisfaction rating of
Federal agencies. It assists small businesses in recovering attorneys'
fees if they have been subject to excessive and unsustainable
enforcement actions, and subjects final agency actions under the
Regulatory Flexibility Act to judicial review. Small businesses will
now be able to hold the feet of Federal agencies to the fire and ensure
that they comply with the letter and spirit of the Regulatory
Flexibility Act
Finally, I am very pleased that the congressional veto legislation
developed by Senators Reid and Nickles and passed by the Senate last
year has been added to the Small Business Regulatory Fairness Act. The
Reid/Nickles provision establishes a process through which Congress can
review major regulations before they are issued, thereby ensuring that
the agencies developing these rules adhere to the intent of Congress
and develop reasonable requirements for American business.
Mr. President, the Small Business Regulatory Fairness Act was written
with advice from the small business community and will pass the Senate
with strong bipartisan support. It reaffirms Congress' belief in the
essential role that small business plays in the American economy and
sends a clear signal that the public and private sectors are ready to
work together in promoting the economic growth and expansion we will
need to compete in the 21st century. I urge all my colleagues to
support this important bill.
The PRESIDING OFFICER. The bill having been read the third time, the
question is, Shall the bill, as amended, pass? The yeas and nays have
been ordered. The clerk will call the roll.
The assistant legislative clerk called the roll.
The PRESIDING OFFICER (Mr. Smith). Are there any other Senators in
the Chamber desiring to vote?
The result was announced--yeas 100, nays 0, as follows:

[Rollcall Vote No. 43 Leg.]

YEAS--100

Abraham
Akaka
Ashcroft
Baucus
Bennett
Biden
Bingaman
Bond
Boxer
Bradley
Breaux
Brown
Bryan
Bumpers
Burns
Byrd
Campbell
Chafee
Coats
Cochran
Cohen
Conrad
Coverdell
Craig
D'Amato
Daschle
DeWine
Dodd
Dole
Domenici
Dorgan
Exon
Faircloth
Feingold
Feinstein
Ford
Frist
Glenn
Gorton
Graham
Gramm
Grams
Grassley
Gregg
Harkin
Hatch
Hatfield
Heflin
Helms
Hollings
Hutchison
Inhofe
Inouye
Jeffords
Johnston
Kassebaum
Kempthorne
Kennedy
Kerrey
Kerry
Kohl
Kyl
Lautenberg
Leahy
Levin
Lieberman
Lott
Lugar
Mack
McCain
McConnell
Mikulski
Moseley-Braun
Moynihan
Murkowski
Murray
Nickles
Nunn
Pell
Pressler
Pryor
Reid
Robb
Rockefeller
Roth
Santorum
Sarbanes
Shelby
Simon
Simpson
Smith
Snowe
Specter
Stevens
Thomas
Thompson
Thurmond
Warner
Wellstone
Wyden
The bill (S. 942) was passed, as follows:

S. 942

Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,

[[Page S2317]]

SECTION. 1. SHORT TITLE.

This Act may be cited as the ``Small Business Regulatory
Enforcement Fairness Act of 1996''.

SEC. 2. FINDINGS.

Congress finds that--
(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) fundamental changes that are needed in the regulatory
and enforcement culture of Federal agencies to make agencies
more responsive to small business can be made without
compromising the statutory missions of the agencies;
(4) three of the top recommendations of the White House
Conference on Small Business involve reforms to the way
Government regulations are developed and enforced, and
reductions in Government paperwork requirements;
(5) the requirements of the Regulatory Flexibility Act have
too often been ignored by Government agencies, resulting in
greater regulatory burdens on small entities than
necessitated by statute; and
(6) small entities should be given the opportunity to seek
judicial review of agency actions required by the Regulatory
Flexibility Act.

SEC. 3. PURPOSES.

The purposes of this Act are--
(1) to implement certain recommendations of the 1995 White
House Conference on Small Business regarding the development
and enforcement of Federal regulations;
(2) to provide for judicial review of the Regulatory
Flexibility Act;
(3) to encourage the effective participation of small
businesses in the Federal regulatory process;
(4) to simplify the language of Federal regulations
affecting small businesses;
(5) to develop more accessible sources of information on
regulatory and reporting requirements for small businesses;
(6) to create a more cooperative regulatory environment
among agencies and small businesses that is less punitive and
more solution-oriented; and
(7) to make Federal regulators more accountable for their
enforcement actions by providing small entities with a
meaningful opportunity for redress of excessive enforcement
activities.

SEC. 4. EFFECTIVE DATE.

This Act shall become effective on the date 90 days after
enactment, except that the amendments made by title IV of
this Act shall not apply to interpretive rules for which a
notice of proposed rulemaking was published prior to the date
of enactment.
TITLE I--REGULATORY COMPLIANCE SIMPLIFICATION

SEC. 101. DEFINITIONS.

For purposes of this Act--
(1) the terms ``rule'' and ``small entity'' have the same
meanings as in section 601 of title 5, United States Code;
(2) the term ``agency'' has the same meaning as in section
551 of title 5, United States Code; and
(3) the term ``small entity compliance guide'' means a
document designated as such by an agency.

SEC. 102. COMPLIANCE GUIDES.

(a) Compliance Guide.--For each rule or group of related
rules for which an agency is required to prepare a final
regulatory flexibility analysis under section 604 of title 5,
United States Code, the agency shall publish one or more
guides to assist small entities in complying with the rule,
and shall designate such publications as ``small entity
compliance guides''. The guides shall explain the actions a
small entity is required to take to comply with a rule or
group of rules. The agency shall, in its sole discretion,
taking into account the subject matter of the rule and the
language of relevant statutes, ensure that the guide is
written using sufficiently plain language likely to be
understood by affected small entities. Agencies may prepare
separate guides covering groups or classes of similarly
affected small entities, and may cooperate with associations
of small entities to develop and distribute such guides.
(b) Comprehensive Source of Information.--Agencies shall
cooperate to make available to small entities through
comprehensive sources if information, the small entity
compliance guides and all other available information on
statutory and regulatory requirements affecting small
entities.
(c) Limitation on Judicial review.--An agency's small
entity compliance guide shall not be subject to judicial
review, except that in any civil or administrative action
against a small entity for a violation occurring after the
effective date of this section, the content of the small
entity compliance guide may be considered as evidence of the
reasonableness or appropriateness of any proposed fines,
penalties or damages.

SEC. 103. INFORMAL SMALL ENTITY GUIDANCE.

(a) General.--Whenever appropriate in the interest of
administering statutes and regulations within the
jurisdiction of an agency, it shall be the practice of the
agency to answer inquiries by small entities concerning
information on and advice about compliance with such statutes
and regulations, interpreting and applying the law to
specific sets of facts supplied by the small entity. In any
civil or administrative action against a small entity,
guidance given by an agency applying the law to facts
provided by the small entity may be considered as evidence of
the reasonableness or appropriateness of any proposed fines,
penalties or damages sought against such small entity.
(b) Program.--Each agency regulating the activities of
small entities shall establish a program for responding to
such inquiries no later than 1 year after enactment of this
section, utilizing existing functions and personnel of the
agency to the extent practicable.

SEC. 104. SERVICES OF SMALL BUSINESS DEVELOPMENT CENTERS.

Section 21(c)(3) of the Small Business Act (15 U.S.C.
648(c)(3)) is amended--
(1) in subparagraph (O), by striking ``and'' at the end;
(2) in subparagraph (P), by striking the period at the end
and inserting a semicolon; and
(3) by inserting after subparagraph (P) the following new
subparagraphs:
``(Q) providing assistance to small business concerns
regarding regulatory requirements, including providing
training with respect to cost-effective regulatory
compliance;
``(R) developing informational publications, establishing
resource centers of reference materials, and distributing
compliance guides published under section 102(a) of the Small
Business Regulatory Enforcement Fairness Act of 1996 to small
business concerns; and
``(S) developing programs to provide confidential onsite
assessments and recommendations regarding regulatory
compliance to small business concerns and assisting small
business concerns in analyzing the business development
issues associated with regulatory implementation and
compliance measures.''.

SEC. 105. MANUFACTURING TECHNOLOGY CENTERS AND PROGRAMS
ESTABLISHED UNDER SECTION 507 OF THE CLEAN AIR
ACT AMENDMENTS OF 1990.

(a) General.--The Manufacturing Technology Centers and
other similar extension centers administered by the National
Institute of Standards and Technology of the Department of
Commerce shall, as appropriate, provide the assistance
regarding regulatory requirements, develop and distribute
information and guides and develop the programs to provide
confidential onsite assessments and recommendations regarding
regulatory compliance to the same extent as provided for in
section 104 of this Act with respect to Small Business
Development Centers.
(b) Section 507 Programs.--Nothing in this Act in any way
limits the authority and operation of the small business
stationary source technical and environmental compliance
assistance programs established under section 507 of the
Clean Air Act Amendments of 1990.

SEC. 106. COOPERATION ON GUIDANCE.

Agencies may, to the extent resources are available and
where appropriate, in cooperation with the States, develop
guides that fully integrate requirements of both Federal and
State regulations where regulations within an agency's area
of interest at the Federal and State levels impact small
businesses. Where regulations vary among the States, separate
guides may be created for separate States in cooperation with
State agencies.
TITLE II--REGULATORY ENFORCEMENT REFORMS

SEC. 201. SMALL BUSINESS AND AGRICULTURE ENFORCEMENT
OMBUDSMAN.

The Small Business Act (15 U.S.C. 631 et seq.) is amended--
(1) by redesignating section 30 as section 31; and
(2) by inserting after section 29 the following new
section:

``SEC. 30. OVERSIGHT OF REGULATORY ENFORCEMENT.

``(a) Definitions.--For purposes of this section, the
term--
``(1) ``Board'' means a Regional Small Business Regulatory
Fairness Board established under subsection (c); and
``(2) ``Ombudsman'' means the Small Business and
Agriculture Regulatory Enforcement Ombudsman designated under
subsection (b).
``(b) SBA Enforcement Ombudsman.--
``(1) Not later than 180 days after the date of enactment
of this section, the Administration shall designate a Small
Business and Agriculture Regulatory Enforcement Ombudsman
utilizing personnel of the Small Business Administration to
the extent practicable. Other agencies shall assist the
Ombudsman and take actions as necessary to ensure compliance
with the requirements of this section. Nothing in this
section is intended to replace or diminish the activities of
any Ombudsman or similar office in any other agency.
``(2) The Ombudsman shall--
``(A) work with each agency with regulatory authority over
small businesses to ensure that small business concerns that
receive or are subject to an audit, onsite inspection,
compliance assistance effort, or other enforcement related
communication or contact by agency personnel are provided
with a means to comment on the enforcement activity conducted
by such personnel;
``(B) establish means to receive comments from small
business concerns regarding actions by agency employees
conducting compliance or enforcement activities with respect
to the small business concern, means to refer comments to the
Inspector General of the affected agency in the appropriate
circumstances, and otherwise seek to maintain the identity of
the person and small business concern making such comments on
a confidential basis to the same extent as employee
identities are protected under section

[[Page S2318]]

7 of the Inspector General Act of 1978 (5 U.S.C. App.);
``(C) based on substantiated comments received from small
business concerns and the Boards, annually report to Congress
and affected agencies evaluating the enforcement activities
of agency personnel including a rating of the responsiveness
to small business of the various regional and program offices
of each agency;
``(D) coordinate and report annually on the activities,
findings, and recommendations of the Boards to the
Administration and to the heads of affected agencies; and
``(E) provide the affected agency with an opportunity to
comment on draft reports prepared under paragraph (C) and
include a section of the final report in which the affected
agency may make such comments as are not addressed by the
Ombudsman in revisions to the draft.
``(c) Regional Small Business Regulatory Fairness Boards.--
``(1) Not later than 180 days after the date of enactment
of this section, the Administration shall establish a Small
Business Regulatory Fairness Board in each regional office of
the Small Business Administration.
``(2) Each Board established under paragraph (1) shall--
``(A) meet at least annually to advise the Ombudsman on
matters of concern to small businesses relating to the
enforcement activities of agencies;
``(B) report to the Ombudsman on substantiated instances of
excessive enforcement actions of agencies against small
business concerns including any findings or recommendations
of the Board as to agency enforcement policy or practice; and
``(C) prior to publication, provide comment on the annual
report of the Ombudsman prepared under subsection (b).
``(3) Each Board shall consist of five members appointed by
the Administration, who are owners or operators of small
entities, after receiving the recommendations of the chair
and ranking minority member of the Committees on Small
Business of the House of Representatives and the Senate.
``(4) Members of the Board shall serve for terms of three
years or less.
``(5) The Administration shall select a chair from among
the members of the Board who shall serve for not more than 2
years as chair.
``(6) A majority of the members of the Board shall
constitute a quorum for the conduct of business, but a lesser
number may hold hearings.
``(d) Powers of the Boards.--
``(1) The Board may hold such hearings and collect such
information as appropriate for carrying out this section.
``(2) The Board may use the United States mails in the same
manner and under the same conditions as other departments and
agencies of the Federal Government.
``(3) The Board may accept donations of services necessary
to conduct its business: Provided, That the donations and
their sources are disclosed by the Board.
``(4) Members of the Board shall serve without
compensation: Provided, That members of the Board shall be
allowed travel expenses, including per diem in lieu of
subsistence, at rates authorized for employees of agencies
under subchapter I of chapter 57 of title 5, United States
Code, while away from their homes or regular places of
business in the performance of services for the Board.''.

SEC. 202. RIGHTS OF SMALL ENTITIES IN ENFORCEMENT ACTIONS.

(a) In General.--Each agency regulating the activities of
small entities shall establish a policy or program within 1
year of enactment of this section to provide for the
reduction, and under appropriate circumstances for the
waiver, of civil penalties for violations of a statutory or
regulatory requirement by a small entity. Under appropriate
circumstances, an agency may consider ability to pay in
determining penalty assessments on small entities.
(b) Conditions and Exclusions.--Subject to the requirements
or limitations of other statutes, policies or programs
established under this section shall contain conditions or
exclusions which may include, but shall not be limited to--
(1) requiring the small entity to correct the violation
within a reasonable correction period;
(2) limiting the applicability to violations discovered by
the small entity through participation in a compliance
assistance or audit program operated or supported by the
agency or a State;
(3) excluding small entities that have been subject to
multiple enforcement actions by the agency;
(4) excluding violations involving willful or criminal
conduct;
(5) excluding violations that pose serious health, safety
or environmental threats; and
(6) requiring a good faith effort to comply with the law.
(c) Reporting.--Agencies shall report to Congress no later
than 2 years from the effective date on the scope of their
program or policy, the number of enforcement actions against
small entities that qualified or failed to qualify for the
program or policy, and the total amount of penalty reductions
and waivers.
TITLE III--EQUAL ACCESS TO JUSTICE ACT AMENDMENTS

SEC. 301. ADMINISTRATIVE PROCEEDINGS.

Section 504 of title 5, United States Code, is amended--
(1) in subsection (b), by striking ``$75'' in subparagraph
(b)(1) and inserting ``$125''; and
(2) in subsection (a) by adding the following new
paragraph:
``(4) In an adversary adjudication brought by an agency, an
adjudicative officer of the agency shall award attorney's
fees and other expenses to a party or a small entity, as
defined in section 601, if the decision of the adjudicative
officer is disproportionately less favorable to the agency
than an express demand by the agency, unless the party or
small entity has committed a willful violation of law or
otherwise acted in bad faith, or special circumstances make
an award of attorney's fees unjust. For purposes of this
paragraph, an `express demand' shall not include a recitation
by the agency of the maximum statutory penalty (A) in the
administrative complaint, or (B) elsewhere when accompanied
by an express demand for a lesser amount. Fees and expenses
awarded under this paragraph may not be paid from the claims
and judgments account of the Treasury from funds appropriated
pursuant to section 1304 of title 31, United States Code.''.

SEC. 302. JUDICIAL PROCEEDINGS.

Section 2412 of title 28, United States Code, is amended--
(1) in paragraph (d), by striking ``$75'' in subparagraph
(2)(A) and inserting ``$125''; and
(2) in paragraph (d)(1) by adding the following new
subparagraph:
``(D) In a civil action brought by the United States, a
court shall award attorney's fees and other expenses to a
party or a small entity, as defined in section 601 of title
5, United States Code, if the judgment finally obtained by
the United States is disproportionately less favorable to the
United States than an express demand by the United States,
unless the party or small entity has committed a willful
violation of law or otherwise acted in bad faith, or special
circumstances make an award of attorney's fees unjust. For
purposes of this subparagraph, an `express demand' shall not
include a recitation of the maximum statutory penalty (i) in
the complaint, or (ii) elsewhere when accompanied by an
express demand for a lesser amount. Fees and expenses awarded
under this subparagraph may not be paid from the claims and
judgments account of the Treasury from funds appropriated
pursuant to section 1304 of title 31, United States Code.''.
TITLE IV--REGULATORY FLEXIBILITY ACT AMENDMENTS

SEC. 401. REGULATORY FLEXIBILITY ANALYSES.

(a) Initial Regulatory Flexibility Analysis.--Section
603(a) of title 5, United States Code, is amended--
(1) by inserting after ``proposed rule'', the phrase ``, or
publishes a notice of proposed rulemaking for an interpretive
rule involving the internal revenue laws of the United
States''; and
(2) by inserting at the end of the subsection, the
following new sentence: ``In the case of an interpretive rule
involving the internal revenue laws of the United States,
this chapter applies to interpretive rules published in the
Federal Register for codification in the Code of Federal
Regulations, but only to the extent that such interpretive
rules impose on small entities a collection of information
requirements, as defined in the Paperwork Reduction Act of
1995.''.
(b) Final Regulatory Flexibility Analysis.--Section 604 of
title 5, United States Code, is amended--
(1) in subsection (a) to read as follows:
``(a) When an agency promulgates a final rule under section
553 of this title, after being required by that section or
any other law to publish a general notice of proposed
rulemaking, or is otherwise required to publish an initial
regulatory flexibility analysis, the agency shall prepare a
final regulatory flexibility analysis. Each final regulatory
flexibility analysis shall contain--
``(1) a succinct statement of the need for, and objectives
of, the rule;
``(2) a summary of the significant issues raised by the
public comments in response to the initial regulatory
flexibility analysis, a summary of the assessment of the
agency of such issues, and a statement of any changes made in
the proposed rule as a result of such comments;
``(3) a description of and an estimate of the number of
small entities to which the rule will apply or an explanation
of why no such estimate is available;
``(4) a description of the projected reporting, record
keeping and other compliance requirements of the rule,
including an estimate of the classes of small entities which
will be subject to the requirement and the type of
professional skills necessary for preparation of the report
or record; and
``(5) a description of the steps the agency has taken to
minimize the significant economic impact on small entities
consistent with the stated objectives of applicable statutes,
including a statement of the factual, policy, and legal
reasons for selecting the alternative adopted in the final
rule and why each one of the other significant alternatives
to the rule considered by the agency which affect the impact
on small business was rejected.''; and
(2) in subsection (b), by striking ``at the time'' and all
that follows and inserting ``such analysis or a summary
thereof.''.

SEC. 402. JUDICIAL REVIEW.

Section 611 of title 5, United States Code, is amended to
read as follows:

``Sec. 611. Judicial review

``(a)(1) For any rule subject to this chapter, a small
entity that is adversely affected or aggrieved by final
agency action is entitled

[[Page S2319]]

to judicial review of agency compliance with the requirements
of this chapter, except the requirements of sections 602,
603, 609 and 612.
``(2) Each court having jurisdiction to review such rule
for compliance with section 553 of this title or under any
other provision of law shall have jurisdiction to review any
claims of noncompliance with this chapter, except the
requirements of sections 602, 603, 609 and 612.
``(3)(A) A small entity may seek such review during the
period beginning on the date of final agency action and
ending one year later, except that where a provision of law
requires that an action challenging a final agency action be
commenced before the expiration of one year, such lesser
period shall apply to a petition for judicial review under
this section.
``(B) In the case where an agency delays the issuance of a
final regulatory flexibility analysis pursuant to section
608(b) of this chapter, a petition for judicial review under
this section shall be filed not later than--
``(i) one year after the date the analysis is made
available to the public, or
``(ii) where a provision of law requires that an action
challenging a final agency regulation be commenced before the
expiration of the one year period, the number of days
specified in such provision of law that is after the date the
analysis is made available to the public.
``(4) If the court determines, on the basis of the
rulemaking record, that the final agency action under this
chapter was arbitrary, capricious, an abuse of discretion or
otherwise not in accordance with the law, the court shall
order the agency to take corrective action consistent with
this chapter, which may include--
``(A) remanding the rule to the agency, and
``(B) deferring the enforcement of the rule against small
entities, unless the court finds good cause for continuing
the enforcement of the rule pending the completion of the
corrective action.
``(5) Nothing in this subsection shall be construed to
limit the authority of any court to stay the effective date
of any rule or provision thereof under any other provision of
law or to grant any other relief in addition to the
requirements of this section.
``(b) In an action for the judicial review of a rule, the
regulatory flexibility analysis for such rule, including an
analysis prepared or corrected pursuant to paragraph (a)(4),
shall constitute part of the entire record of agency action
in connection with such review.
``(c) Except as otherwise required by this chapter, the
court shall apply the same standards of judicial review that
govern the review of agency findings under the statute
granting the agency authority to conduct a rulemaking.
``(d) Compliance or noncompliance by an agency with the
provisions of this chapter shall be subject to judicial
review only in accordance with this section.
``(e) Nothing in this section bars judicial review of any
other impact statement or similar analysis required by any
other law if judicial review of such statement or analysis is
otherwise permitted by law.''.

SEC. 403. TECHNICAL AND CONFORMING AMENDMENTS.

(a) Section 605(b) of title 5, United States Code, is
amended to read as follows:
``(b) Sections 603 and 604 of this title shall not apply to
any proposed or final rule if the head of the agency
certifies that the rule will not, if promulgated, have a
significant economic impact on a substantial number of small
entities. If the head of the agency makes a certification
under the preceding sentence, the agency shall publish such
certification in the Federal Register, at the time of
publication of general notice of proposed rulemaking for the
rule or at the time of publication of the final rule, along
with a statement providing the factual and legal reasons for
such certification. The agency shall provide such
certification and statement to the Chief Counsel for Advocacy
of the Small Business Administration.''.
(b) Section 612 of title 5, United States Code, is
amended--
(1) in subsection (a), by striking ``the committees on the
Judiciary of the Senate and the House of Representatives, the
Select Committee on Small Business of the Senate, and the
Committee on Small Business of the House of Representatives''
and inserting ``the Committees on the Judiciary and Small
Business of the Senate and House of Representatives''.
(2) in subsection (b), by striking ``his views with respect
to the'' and inserting in lieu thereof, ``his or her views
with respect to compliance with this chapter, the adequacy of
the rulemaking record with respect to small entities and
the''.

SEC. 404. SMALL BUSINESS ADVOCACY REVIEW PANELS.

(a) Small Business Outreach and Interagency Coordination.--
Section 609 of title 5, United States Code, is amended--
(1) before ``techniques,'' by inserting ``the reasonable
use of'';
(2) in paragraph (4), after ``entities'', by inserting
``including soliciting and receiving comments over computer
networks'';
(3) by designating the current text as subsection (a); and
(4) by adding the following new subsection:
``(b) Prior to publication of an initial regulatory
flexibility analysis which a covered agency is required to
conduct by this chapter--
``(1) a covered agency shall notify the Chief Counsel for
Advocacy of the Small Business Administration and 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;
``(2) not later than 15 days after the date of receipt of
the materials described in paragraph (1), the Chief Counsel
shall identify individuals representative of affected small
entities for the purpose of obtaining advice and
recommendations from those individuals about the potential
impacts of the proposed rule;
``(3) the agency shall convene a review panel for such rule
consisting wholly of full-time Federal employees of the
office within the agency responsible for carrying out the
proposed rule, the Office of Information and Regulatory
Affairs within the Office of Management and Budget, and the
Chief Counsel;
``(4) the panel shall review any material the agency has
prepared in connection with this chapter, including any draft
proposed rule, collect advice and recommendations of the
small entity representatives identified by the agency after
consultation with the Chief Counsel, on issues related to
subsections 603(b), paragraphs (3), (4) and (5) and 603(c);
``(5) not later than 60 days after the date a covered
agency convenes a review panel pursuant to paragraph (3), the
review panel shall report on the comments of the small entity
representatives and its findings as to issues related to
subsections 603(b), paragraphs (3), (4) and (5) and 603(c):
Provided, That such report shall be made public as part of
the rulemaking record; and
``(6) where appropriate, the agency shall modify the
proposed rule, the initial regulatory flexibility analysis or
the decision on whether an initial regulatory flexibility
analysis is required.
``(c) Prior to publication of a final regulatory
flexibility analysis that a covered agency is required by
this chapter to conduct--
``(1) an agency shall reconvene the review panel
established under paragraph (b)(3), or if no initial
regulatory flexibility analysis was published, undertake the
actions described in paragraphs (b) (1) through (3);
``(2) the panel shall review any material the agency has
prepared in connection with this chapter, including any draft
rule, collect the advice and recommendations of the small
entity representatives identified by the agency after
consultation with the Chief Counsel, on issues related to
subsection 604(a), paragraphs (3), (4) and (5);
``(3) not later than 15 days after the date a covered
agency convenes a review panel pursuant to paragraph (1), the
review panel shall report on the comments of the small entity
representatives and its findings as to issues related to
subsection 604(a), paragraphs (3), (4) and (5): Provided,
That such report shall be made public as part of the
rulemaking record; and
``(4) where appropriate, the agency shall modify the final
rule, the final regulatory flexibility analysis or the
decision on whether a final regulatory flexibility analysis
is required.
``(d) An agency may in its discretion apply subsections (b)
and (c) to rules that the agency intends to certify under
subsection 605(b), but the agency believes may have a greater
than de minimis impact on a substantial number of small
entities.
``(e) For purposes of this section, the term `covered
agency' means the Environmental Protection Agency and the
Occupational Health and Safety Administration of the
Department of Labor.
``(f) The Chief Counsel for Advocacy, in consultation with
the individuals identified in paragraph (b)(2) and with the
Administrator of the Office of Information and Regulatory
Affairs within the Office of Management and Budget, may waive
the requirements of paragraphs (b)(3), (b)(4), and (b)(5),
and subsection (c) by including in the rulemaking record a
written finding, with reasons therefor, that those
requirements would not advance the effective participation of
small entities in the rulemaking process. For purposes of
this subsection, the factors to be considered in making such
a finding are as follows--
``(1) in developing a proposed rule, the extent to which
the covered agency consulted with individuals representative
of affected small entities with respect to the potential
impacts of the rule and took such concerns into
consideration; or in developing a final rule, the extent to
which the covered agency took into consideration the comments
filed by the individuals identified in paragraph (b)(2);
``(2) special circumstances requiring prompt issuance of
the rule; and
``(3) whether the requirements of subsection (b) or (c)
would provide the individuals identified in subsection (b)(2)
with a competitive advantage relative to other small
entities.''.
(b) Small Business Advocacy Chairpersons.--Not later than
30 days after the date of enactment of this Act, the head of
each agency that has conducted a final regulatory flexibility
analysis shall designate a small business advocacy
chairperson using existing personnel to the extent possible,
to be responsible for implementing this section and to act as
permanent chair of the agency's review panels established
pursuant to this section.
TITLE V--CONGRESSIONAL REVIEW

SEC. 501. SHORT TITLE.

This title may be cited as the ``Congressional Review Act
of 1996''.

[[Page S2320]]

SEC. 502. FINDING.

The Congress finds that effective steps for improving the
efficiency and proper management of Government operations
will be promoted if a moratorium on the effectiveness of
certain significant final rules is imposed in order to
provide Congress an opportunity for review.

SEC. 503. MORATORIUM ON REGULATIONS; CONGRESSIONAL REVIEW.

(a) Reporting and Review of Regulations.--
(1) Reporting to congress and the comptroller general.--
(A) Before a rule can take effect as a final rule, the
Federal agency promulgating such rule shall submit to each
House of the Congress and to the Comptroller General a report
containing--
(i) a copy of the rule;
(ii) a concise general statement relating to the rule; and
(iii) the proposed effective date of the rule.
(B) The Federal agency promulgating the rule shall make
available to each House of Congress and the Comptroller
General, upon request--
(i) a complete copy of the cost-benefit analysis of the
rule, if any;
(ii) the agency's actions relevant to section 603, section
604, section 605, section 607, and section 609 of Public Law
96-354;
(iii) the agency's actions relevant to title II, section
202, section 203, section 204, and section 205 of Public Law
104-4; and
(iv) any other relevant information or requirements under
any other Act and any relevant Executive Orders, such as
Executive Order 12866.
(C) Upon receipt, each House shall provide copies to the
Chairman and Ranking Member of each committee with
jurisdiction.
(2) Reporting by the comptroller general.--
(A) The Comptroller General shall provide a report on each
significant rule to the committees of jurisdiction to each
House of the Congress by the end of 12 calendar days after
the submission or publication date as provided in section
504(b)(2). The report of the Comptroller General shall
include an assessment of the agency's compliance with
procedural steps required by subparagraph (B) (i) through
(iv).
(B) Federal agencies shall cooperate with the Comptroller
General by providing information relevant to the Comptroller
General's report under paragraph (2)(A) of this section.
(3) Effective date of significant rules.--A significant
rule relating to a report submitted under paragraph (1) shall
take effect as a final rule, the latest of--
(A) the later of the date occurring 45 days after the date
on which--
(i) the Congress receives the report submitted under
paragraph (1); or
(ii) the rule is published in the Federal Register;
(B) if the Congress passes a joint resolution of
disapproval described under section 504 relating to the rule,
and the President signs a veto of such resolution, the
earlier date--
(i) on which either House of Congress votes and fails to
override the veto of the President; or
(ii) occurring 30 session days after the date on which the
Congress received the veto and objections of the President;
or
(C) the date the rule would have otherwise taken effect, if
not for this section (unless a joint resolution of
disapproval under section 504 is enacted).
(4) Effective date for other rules.--Except for a
significant rule, a rule shall take effect as otherwise
provided by law after submission to Congress under paragraph
(1).
(5) Failure of joint resolution of disapproval.--
Notwithstanding the provisions of paragraph (3), the
effective date of a rule shall not be delayed by operation of
this title beyond the date on which either House of Congress
votes to reject a joint resolution of disapproval under
section 504.
(b) Termination of Disapproved Rulemaking.--A rule shall
not take effect (or continue) as a final rule, if the
Congress passes a joint resolution of disapproval described
under section 504.
(c) Presidential Waiver Authority.--
(1) Presidential determinations.--Notwithstanding any other
provision of this section (except subject to paragraph (3)),
a rule that would not take effect by reason of this title may
take effect, if the President makes a determination under
paragraph (2) and submits written notice of such
determination to the Congress.
(2) Grounds for determinations.--Paragraph (1) applies to a
determination made by the President by Executive order that
the rule should take effect because such rule is--
(A) necessary because of an imminent threat to health or
safety or other emergency;
(B) necessary for the enforcement of criminal laws; or
(C) necessary for national security.
(3) Waiver not to affect congressional disapprovals.--An
exercise by the President of the authority under this
subsection shall have no effect on the procedures under
section 504 or the effect of a joint resolution of
disapproval under this section.
(d) Treatment of Rules Issued at End of Congress.--
(1) Additional opportunity for review.--In addition to the
opportunity for review otherwise provided under this title,
in the case of any rule that is published in the Federal
Register (as a rule that shall take effect as a final rule)
during the period beginning on the date occurring 60 days
before the date the Congress adjourns sine die through the
date on which the succeeding Congress first convenes, section
504 shall apply to such rule in the succeeding Congress.
(2) Treatment under section 504.--
(A) In applying section 504 for purposes of such additional
review, a rule described under paragraph (1) shall be treated
as though--
(i) such rule were published in the Federal Register (as a
rule that shall take effect as a final rule) on the 15th
session day after the succeeding Congress first convenes; and
(ii) a report on such rule were submitted to Congress under
subsection (a)(1) on such date.
(B) Nothing in this paragraph shall be construed to affect
the requirement under subsection (a)(1) that a report must be
submitted to Congress before a final rule can take effect.
(3) Actual effective date not affected.--A rule described
under paragraph (1) shall take effect as a final rule as
otherwise provided by law (including other subsections of
this section).
(e) Treatment of Rules Issued Before This Title.--
(1) Opportunity for congressional review.--The provisions
of section 504 shall apply to any significant rule that is
published in the Federal Register (as a rule that shall take
effect as a final rule) during the period beginning on March
1, 1996, through the date on which this title takes effect.
(2) Treatment under section 504.--In applying section 504
for purposes of Congressional review, a rule described under
paragraph (1) shall be treated as though--
(A) such rule were published in the Federal Register (as a
rule that shall take effect as a final rule) on the date of
the enactment of this Act; and
(B) a report on such rule were submitted to Congress under
subsection (a)(1) on such date.
(3) Actual effective date not affected.--The effectiveness
of a rule described under paragraph (1) shall be as otherwise
provided by law, unless the rule is made of no force or
effect under section 504.
(f) Nullification of Rules Disapproved by Congress.--Any
rule that takes effect and later is made of no force or
effect by the enactment of a joint resolution under section
504 shall be treated as though such rule had never taken
effect.
(g) No Inference to be Drawn Where Rules Not Disapproved.--
If the Congress does not enact a joint resolution of
disapproval under section 504, no court or agency may infer
any intent of the Congress from any action or inaction of the
Congress with regard to such rule, related statute, or joint
resolution of disapproval.

SEC. 504. CONGRESSIONAL DISAPPROVAL PROCEDURE.

(a) Joint Resolution Defined.--For purposes of this
section, the term ``joint resolution'' means only a joint
resolution introduced during the period beginning on the date
on which the report referred to in section 503(a) is received
by Congress and ending 45 days thereafter, the matter after
the resolving clause of which is as follows: ``That Congress
disapproves the rule submitted by the ____ relating to ____,
and such rule shall have no force or effect.''. (The blank
spaces being appropriately filled in.)
(b) Referral.--
(1) In general.--A resolution described in paragraph (1)
shall be referred to the committees in each House of Congress
with jurisdiction. Such a resolution may not be reported
before the eighth day after its submission or publication
date.
(2) Submission date.--For purposes of this subsection the
term ``submission or publication date'' means the later of
the date on which--
(A) the Congress receives the report submitted under
section 503(a)(1); or
(B) the rule is published in the Federal Register.
(c) Discharge.--If the committee to which is referred a
resolution described in subsection (a) has not reported such
resolution (or an identical resolution) at the end of 20
calendar days after the submission or publication date
defined under subsection (b)(2), such committee may be
discharged from further consideration of such resolution in
the Senate upon a petition supported in writing by 30 Members
of the Senate and in the House upon a petition supported in
writing by one-fourth of the Members duly sworn and chosen or
by motion of the Speaker supported by the Minority Leader,
and such resolution shall be placed on the appropriate
calendar of the House involved.
(d) Floor Consideration.--
(1) In general.--When the committee to which a resolution
is referred has reported, or when a committee is discharged
(under subsection (c)) from further consideration of, a
resolution described in subsection (a), it is at any time
thereafter in order (even though a previous motion to the
same effect has been disagreed to) for a motion to proceed to
the consideration of the resolution, and all points of order
against the resolution (and against consideration of
resolution) are waived. The motion is not subject to
amendment, or to a motion to postpone, or to a motion to
proceed to the consideration of other business. A motion to
reconsider the vote by which the motion is agreed to or
disagreed to shall not be in order. If a motion to proceed to
the consideration of the resolution is agreed to, the
resolution shall remain

[[Page S2321]]

the unfinished business of the respective House until
disposed of.
(2) Debate.--Debate on the resolution, and on all debatable
motions and appeals in connection therewith, shall be limited
to not more than 10 hours, which shall be divided equally
between those favoring and those opposing the resolution. A
motion further to limit debate is in order and not debatable.
An amendment to, or a motion to postpone, or a motion to
proceed to the consideration of other business, or a motion
to recommit the resolution is not in order.
(3) Final passage.--Immediately following the conclusion of
the debate on a resolution described in subsection (a), and a
single quorum call at the conclusion of the debate if
requested in accordance with the rules of the appropriate
House, the vote on final passage of the resolution shall
occur.
(4) Appeals.--Appeals from the decisions of the Chair
relating to the application of the rules of the Senate or the
House of Representatives, as the case may be, to the
procedure relating to a resolution described in subsection
(a) shall be decided without debate.
(e) Treatment if Other House Has Acted.--If, before the
passage by one House of a resolution of that House described
in subsection (a), that House receives from the other House a
resolution described in subsection (a), then the following
procedures shall apply:
(1) Nonreferral.--The resolution of the other House shall
not be referred to a committee.
(2) Final passage.--With respect to a resolution described
in subsection (a) of the House receiving the resolution--
(A) the procedure in that House shall be the same as if no
resolution had been received from the other House; but
(B) the vote on final passage shall be on the resolution of
the other House.
(f) Constitutional Authority.--This section is enacted by
Congress--
(1) as an exercise of the rulemaking power of the Senate
and House of Representatives, respectively, and as such it is
deemed a part of the rules of each House, respectively, but
applicable only with respect to the procedure to be followed
in that House in the case of a resolution described in
subsection (a), and it supersedes other rules only to the
extent that it is inconsistent with such rules; and
(2) with full recognition of the constitutional right of
either House to change the rules (so far as relating to the
procedure of that House) at any time, in the same manner, and
to the same extent as in the case of any other rule of that
House.

SEC. 505. SPECIAL RULE ON STATUTORY, REGULATORY AND JUDICIAL
DEADLINES.

(a) In General.--In the case of any deadline for, relating
to, or involving any rule which does not take effect (or the
effectiveness of which is terminated) because of the
enactment of a joint resolution under section 504, that
deadline is extended until the date 12 months after the date
of the joint resolution. Nothing in this subsection shall be
construed to affect a deadline merely by reason of the
postponement of a rule's effective date under section 503(a).
(b) Deadline Defined.--The term ``deadline'' means any date
certain for fulfilling any obligation or exercising any
authority established by or under any Federal statute or
regulation, or by or under any court order implementing any
Federal statute or regulation.

SEC. 506. DEFINITIONS.

For purposes of this title--
(1) Federal agency.--The term ``Federal agency'' means any
``agency'' as that term is defined in section 551(1) of title
5, United States Code (relating to administrative procedure).
(2) Significant rule.--The term ``significant rule''--
(A) means any final rule that the Administrator of the
Office of Information and Regulatory Affairs within the
Office of Management and Budget finds--
(i) has an annual effect on the economy of $100,000,000 or
more or adversely affects in a material way the economy, a
sector of the economy, productivity, competition, jobs, the
environment, public health or safety, or State, local, or
tribal governments or communities;
(ii) creates a serious inconsistency or otherwise
interferes with an action taken or planned by another agency;
(iii) materially alters the budgetary impact of
entitlement, grants, user fees, or loan programs or the
rights and obligations of recipients thereof; or
(iv) raises novel legal or policy issues arising out of
legal mandates, the President's priorities, or the principles
set forth in Executive Order 12866; and
(B) shall not include any rule promulgated under the
Telecommunications Act of 1996 and the amendments made by
such Act.
(3) Final rule.--The term ``final rule'' means any final
rule or interim final rule. As used in this paragraph,
``rule'' has the meaning given such term by section 551 of
title 5, United States Code, except that such term does not
include any rule of particular applicability including a rule
that approves or prescribes for the future rates, wages,
prices, services, or allowances therefor, corporate or
financial structures, reorganizations, mergers, or
acquisitions thereof, or accounting practices or disclosures
bearing on any of the foregoing or any rule of agency
organization, personnel, procedure, practice or any routine
matter.

SEC. 507. JUDICIAL REVIEW.

No determination, finding, action, or omission under this
title shall be subject to judicial review.

SEC. 508. APPLICABILITY; SEVERABILITY.

(a) Applicability.--This title shall apply notwithstanding
any other provision of law.
(b) Severability.--If any provision of this title, or the
application of any provision of this title to any person or
circumstance, is held invalid, the application of such
provision to other persons or circumstances, and the
remainder of this title, shall not be affected thereby.

SEC. 509. EXEMPTION FOR MONETARY POLICY.

Nothing in this title shall apply to rules that concern
monetary policy proposed or implemented by the Board of
Governors of the Federal Reserve System or the Federal Open
Market Committee.

SEC. 510. EXEMPTION FOR HUNTING AND FISHING.

Nothing in this title shall apply to rules that establish,
modify, open, close, or conduct a regulatory program for a
commercial, recreational, or subsistence activity relating to
hunting, fishing, or camping.

SEC. 511. EFFECTIVE DATE.

This title shall take effect on the date of the enactment
of this Act and shall apply to any rule that takes effect as
a final rule on or after such effective date.

Mr. BOND. Mr. President, I move to reconsider the vote by which the
bill was passed.
Mr. DOLE. I move to lay that motion on the table.
The motion to lay on the table was agreed to.
Mr. BOND. Mr. President, I would like to express my appreciation to
my colleagues for the overwhelming endorsement of this small business
regulatory relief measure. Particularly, I want to thank my ranking
member, Senator Bumpers. He and all the members of the committee worked
very hard on this bill.
The purpose of the bill is to provide targeted relief to small
businesses, small entities such as townships, counties, and cities, and
not-for-profit organizations who feel overwhelmed by Government
regulation.
This is a measure providing judicial enforcement and therefore,
putting teeth into the requirements of the measure that Congress
adopted in 1980 saying that regulations affecting small business and
small entities must have an analysis to make sure that flexibility for
these small entities was included and was a No. 3 priority for small
business. At the White House Conference on Small Business held in
Washington last year, 2,000 delegates from all across the country said
this was the third most important item on their agenda.
We took that message from the small businesses, from small entities,
from people who attended our hearings across the country and in
Washington, and people who contacted us in our States, and we crafted a
measure that had the strongest bipartisan support. Our staffs worked
with a wide variety of groups. We had the full support of the President
and the Administrator of the Small Business Administration. But lots of
people had lots of concerns and lots of little issues that needed to be
addressed in this bill. As a result, we made significant numbers of
minor changes to make sure that the bill did what it accomplishes.
I believe that while the project is not perfect, it is an excellent
measure. I hope we will see quick action on it in the House so that we
may come to conference and agree, and send to the President something
at least very close to this measure.

I wish to extend a very special thanks to the counsel for the
minority, John Ball, to the director of the Small Business Committee,
Louis Taylor, and to Keith Cole. Among them, they listened to many,
many hours of telephone calls and concerns from people who had a little
fix here and a little fix there. The end product, I think, reflected
much good advice and some advice that could not be taken. But I express
appreciation, first, to the members of the Small Business Committee
themselves who worked hard on this, to all of their staffs, and to the
representatives of small business who showed the strength and the
resolve to keep us focused on this, a measure designed to provide
regulatory relief to an area which has experienced tremendous burdens
from Government regulations.
Mr. GRASSLEY addressed the Chair.
The PRESIDING OFFICER. The Senator from Iowa.

[[Page S2322]]

Mr. GRASSLEY. Mr. President, I ask unanimous consent to speak as if
in morning business for 8 minutes.
The PRESIDING OFFICER. Without objection, it is so ordered.

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