[Congressional Record Volume 143, Number 50 (Thursday, April 24, 1997)]
[Extensions of Remarks]
[Pages E742-E743]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                     THE FEDERAL REGULATORY BURDEN

                                 ______
                                 

                           HON. SUE W. KELLY

                              of new york

                    in the house of representatives

                        Thursday, April 24, 1997

  Mrs. KELLY. Mr. Speaker, I rise this evening to discuss the burden 
that Federal regulations place on the American economy, especially our 
small businesses. While we are all familiar with this problem, and 
commend the steps taken during the 104th Congress to make improvements, 
we are a long way from providing our Nation's small business owners 
with the relief they need from overregulation.
  We all know that the regulatory burden that the Federal Government 
places on the economy is huge. Exactly how huge is difficult to say. 
One of the most recent studies that we have available to us is a 
November, 1995 report to the U.S. Small Business Administration by 
Thomas Hopkins of the Rochester Institute of Technology. Dr. Hopkins 
found that the total cost of complying with the regulatory burden is 
now approaching a figure as high as $700 billion per year.
  I find this figure to be troubling, particularly because regulatory 
compliance costs disproportionately impact small businesses, those that 
financially are least able to meet Federal regulatory requirements. 
Consider the following statistics: in 1992, the average small firm with 
fewer than 20 employees paid roughly $5,500 per employee to comply with 
Federal regulations. By contrast, firms with more than 500 or more 
employees spent on average a much smaller $3,000 per employee. This is 
a large gap that most small businesses have a difficult time bridging. 
While these are only statistics, they are representative of the very 
real impact that regulations have on our Nation's small business.
  To make matters worse, Federal regulation of small businesses often 
lacks a sound scientific foundation, or put more simply, just doesn't 
make sense. Let me give you an example. I recently received a letter 
from a constituent of mine who operates a small biotechnology company 
in New York. He took great care to make his laboratories as safe as 
possible for both himself and his colleagues, and made every effort to 
comply with all existing regulations. One particular safety feature 
that he included in his laboratories were eye-wash stations that 
included eye-wash bottles. These are squeezable plastic bottles that 
contain a buffer solution to neutralize either acid or base should it 
inadvertently get into someone's eyes. These bottles are also portable 
so that they could quickly be brought to an incapacitated victim should 
an accident occur.

  One day, his laboratory was inspected by the Occupational Safety and 
Health Administration [OSHA], which fined him for not having eyewash 
fountains in the laboratory. Now an eyewash fountain is a fixed piece 
of plumbing

[[Page E743]]

attached to a sink. In order to use it, the employee must be able to 
stand on two feet and bend over to the sink. It cannot be moved, and 
cannot be brought to an immobilized, prone victim. I think that most 
people would agree that this type of fountain is far less useful than a 
portable eyewash bottle with a buffer solution. However, OSHA felt 
otherwise. They seem to believe that strict adherence to some arcane 
regulation, regardless of its cost or practicality, is more important 
than the goal of protecting people's eyes, something that my 
constituent was obviously trying to do.
  This is just one of countless examples that I could cite that 
represent the absurdity of our regulatory system. I chair the 
Regulatory Reform and Paperwork Reduction Subcommittee of the House 
Small Business Committee. Last week, we held a joint hearing that 
looked at the use of sound science in Federal agency rulemaking. We 
heard testimony from distinguished scholars who indicated that Federal 
agencies often initiate the development of new regulations without a 
solid foundation of scientific evidence to support their decisions. 
When this occurs, the small business owners of America are left holding 
the bag.
  The next logical question is: What can be done about this? To its 
credit, Congress has already done something. Last year, the Congress 
passed the Small Business Regulatory Enforcement Fairness Act, better 
known as SBREFA. This was truly landmark legislation that should help 
improve the regulatory process. Contained within this legislation is an 
often overlooked authority that allows Congress to disapprove new 
regulations before they take effect. This process, commonly referred to 
as the Congressional Review Act, gives the legislative branch a direct 
role in the regulatory formation process. While on its own it may not 
mean foolish regulations like the one my constituent has to deal with 
will no longer exist. However, it does mean that Congress can at least 
attempt to prevent new regulations of questionable substance from 
taking effect in the future.
  The problem, however, is that Congress has not exercised its new 
authority under the Congressional Review Act. Since this authority 
became effective on March 29, 1996, roughly 3,600 new regulations have 
gone into effect, including 61 major rules. However, only a handful of 
resolutions of disapproval have been introduced, and the House of 
Representatives has yet to even consider one such resolution.
  Why has Congress been so reluctant to use this authority? It is my 
opinion that Congress has been slow to take advantage of the 
Congressional Review Act because it lacks accurate and reliable data 
with which it can challenge the information of the promulgating agency. 
In many cases, new rules are highly complex and technical in nature. 
Members have neither the time nor the expertise to assess the 
information that the agency is using to base its regulatory decisions 
upon. Until Congress has access to reliable nonpartisan information, it 
is my belief that the Congressional Review Act will remain a paper 
tiger, with no real effect on improving the quality and number of 
regulations that are implemented.
  To help in this process, I am developing legislation that should 
provide Members of Congress with timely and useful information with 
which they can assess the actions taken by the promulgating agency. All 
too often a regulatory agency either ignores or half-heartedly meets 
the regulatory analyses that it is mandated by statute to conduct. This 
must stop. With accurate and reliable information, Members will have a 
credible, factual basis on which to judge whether a specific regulation 
is needed or is consistent with congressional intent.
  We all agree and support having a clean environment and safe 
workplaces, and I want to be clear that I fully support the need for 
strong safeguards for our environment and the American worker. However, 
we must ensure that the ways in which we achieve these goals are based 
on sound science and take into account the legitimate concerns of the 
small businesses that will be regulated. It is my sincere hope that 
Congress can in fact become more active under the Congressional Review 
Act, and put an end to some of the irrational regulations that Federal 
agencies continue to develop.

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