[Congressional Record Volume 148, Number 66 (Tuesday, May 21, 2002)]
[House]
[Pages H2784-H2787]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
SMALL BUSINESS ADVOCACY IMPROVEMENT ACT OF 2002
Mr. MANZULLO. Mr. Speaker, I move to suspend the rules and pass the
bill (H.R. 4231) to improve small business advocacy, and for other
purposes, as amended.
The Clerk read as follows:
H.R. 4231
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Small Business Advocacy
Improvement Act of 2002''.
SEC. 2. FINDINGS AND PURPOSES.
(a) Findings.--Congress finds the following:
(1) Excessive regulations continue to burden the Nation's
small businesses.
(2) Federal agencies continue to propose regulations that
impose disproportionate burdens on small businesses.
(3) An independent office of small business advocacy will
help to ensure that Federal agencies are responsive to small
businesses and that those agencies comply with their
statutory obligations with respect to small businesses.
(4) The independence of an office that acts as an advocate
for small businesses is essential to ensure that it can serve
as an effective advocate without being restricted by the
views or policies of the Small Business Administration or any
other Federal executive branch agency.
(5) To be effective an office that acts as an advocate for
small businesses needs sufficient resources to conduct
creditable economic studies and research which are necessary
for the maintenance of small business databases and for the
accurate assessment of the impact of regulations on small
businesses, the role of small business in the Nation's
economy, and the barriers to the growth of small businesses.
(6) The research, information, and expertise provided by an
independent office of small business advocacy will be a
valuable source of information and advice for Congress and
Federal agencies with which the office will work on behalf of
small businesses.
(b) Purposes.--The purposes of this Act are--
(1) to ensure that there exists an entity that has the
statutory independence and adequate financial resources to
effectively advocate for and on behalf of small business;
(2) to require that such an entity report to the Chairmen
and Ranking Members of the Committee on Small Business of the
House of Representatives and the Committee on Small Business
and Entrepreneurship of the Senate, and to the Administrator
of the Small Business Administration in order to keep them
fully and currently informed about issues and regulations
affecting small business concerns and the necessity for
corrective action by the regulatory agency or Congress;
(3) to provide a separate authorization for appropriations
for such an entity; and
(4) to strengthen the role of the Small Business and
Agriculture Regulatory Enforcement Ombudsman by ensuring
greater cooperation between the Ombudsman and the Office of
Advocacy of the Small Business Administration.
SEC. 3. APPOINTMENT OF CHIEF COUNSEL OF ADVOCACY.
(a) In General.--Section 201 of Public Law 94-305 (15
U.S.C. 634a) is amended--
(1) by inserting ``(a)'' before ``There is established'';
(2) by striking the second sentence; and
(3) by adding at the end the following:
``(b) The management of the Office shall be vested in a
Chief Counsel for Advocacy who shall be appointed from
civilian life by the President, by and with the advice and
consent of the Senate, and who should be appointed without
regard to political affiliation and on the basis of fitness
to perform the duties of the office.
``(c) No individual may be appointed under subsection (b)
if such individual has served as an officer or employee of
the Small Business Administration during the 5-year period
preceding the date of such individual's appointment.
``(d) Any Chief Counsel appointed after the date of the
enactment of this subsection shall be paid at a rate not to
exceed the rate of basic pay for level III of the Executive
Schedule.
``(e) After the expiration of the term of a President, the
Chief Counsel may continue to serve at the pleasure of the
President for a period of not to exceed one year until such
date as a successor to the Chief Counsel is nominated.''.
(b) Incumbent Chief Counsel for Advocacy.--The individual
serving as the Chief Counsel for Advocacy of the Small
Business Administration on the date of the enactment of this
Act shall continue to serve in that position after such date
in accordance with section 201 of Public Law 94-305 (15
U.S.C. 634a), as amended by this section.
SEC. 4. PRIMARY FUNCTIONS OF OFFICE OF ADVOCACY.
Section 202 of Public Law 94-305 (15 U.S.C. 634b) is
amended--
(1) in paragraph (6) by striking ``to minority
enterprises'' and inserting ``to small business concerns
owned and controlled by socially and economically
disadvantaged individuals, to small business concerns owned
and controlled by women, and to small business concerns owned
and controlled by veterans'';
(2) in paragraph (7) by striking ``minority enterprises''
and inserting ``small business concerns owned and controlled
by socially and economically disadvantaged individuals, small
business concerns owned and controlled by women, and small
business concerns owned and controlled by veterans'';
(3) in paragraph (8) by striking ``minority and other small
business enterprises'' and inserting ``small business
concerns owned and controlled by socially and economically
disadvantaged individuals, small business concerns owned and
controlled by women, small business concerns owned and
controlled by veterans, and other small businesses'';
(4) in paragraph (9) by striking ``complete'' and inserting
``compete'';
(5) by striking paragraph (11);
(6) by redesignating paragraph (12) as paragraph (11);
(7) in paragraph (11) (as so redesignated)--
(A) by striking ``serviced-disabled'' and inserting
``service-disabled''; and
(B) by striking the period at the end and inserting ``;
and''; and
(8) by adding at the end the following:
``(12) make such recommendations and submit such reports as
the Chief Counsel determines appropriate to the President, to
the Chairmen and Ranking Members of the Committee on Small
Business of the House of Representatives and the Committee on
Small Business and Entrepreneurship of the Senate, and to the
Administrator of the Small Business Administration, with
respect to issues and regulations affecting small businesses
and the necessity for corrective action by any Federal agency
or by Congress.''.
SEC. 5. ADDITIONAL FUNCTIONS.
(a) In General.--Section 203 of Public Law 94-305 (15
U.S.C. 634c) is amended--
(1) by inserting ``(a)'' before ``The Office of Advocacy
shall also perform''; and
(2) in subsection (a) (as so designated)--
[[Page H2785]]
(A) in paragraph (4) by striking ``and'' at the end;
(B) in paragraph (5) by striking the period at the end and
inserting a semicolon; and
(C) by adding at the end the following:
``(6) maintain economic databases and make the information
contained therein available to the Administrator of the Small
Business Administration and to Congress;
``(7) carry out the responsibilities of the Chief Counsel
under chapter 6 of title 5, United States Code; and
``(8) enter into a memorandum of understanding with the
Small Business and Agriculture Regulatory Enforcement
Ombudsman regarding methods and procedures for cooperation
between the Ombudsman and the Office of Advocacy and transmit
a copy of such memorandum to the Committee on Small Business
of the House of Representatives and the Committee on Small
Business and Entrepreneurship of the Senate.''.
(b) Appropriation Request.--Section 203 of Public Law 94-
305 (15 U.S.C. 634c) is further amended by adding at the end
the following:
``(b)(1) For each fiscal year, the Chief Counsel shall
transmit the Office of Advocacy's appropriation estimate and
request to the Office of Management and Budget, the Committee
on Small Business of the House of Representatives, the
Committee on Small Business and Entrepreneurship of the
Senate, and the Committees on Appropriations of the House of
Representatives and the Senate.
``(2) Each budget of the United States Government submitted
by the President shall include a separate statement of the
amount of appropriations requested for the Office of
Advocacy.''.
SEC. 6. DEPUTY CHIEF COUNSELS AND REGIONAL ADVOCATES.
Section 204 of Public Law 94-305 (15 U.S.C. 634d) is
amended--
(1) by inserting ``(a)'' before ``In carrying out''; and
(2) by adding at the end the following:
``(b)(1) The Chief Counsel may appoint 2 individuals to
serve as Deputy Chief Counsels.
``(2) Notwithstanding any other provision of this section,
the pay rate for each Deputy Chief Counsel may not exceed the
rate of basic pay for level III of the Senior Executive
Service.
``(3) Individuals appointed to positions under this
subsection shall not be counted toward the limitation
contained in subsection (a)(1) regarding the number of
individuals who may be compensated at a rate in excess of the
lowest rate for GS-15 of the General Schedule.
``(c) The Chief Counsel may appoint regional advocates
within each Standard Federal Region as appropriate. Such
regional advocates shall--
``(1) assist in examining the role of small business in the
economy of the United States by identifying academic and
other research institutions that focus on small business
concerns and linking these research resources to research
activities conducted by the Office of Advocacy;
``(2) assist in representing the views and interests of
small business concerns before Federal agencies whose
policies and activities may affect small business;
``(3) in coordination with the Small Business and
Agriculture Regulatory Enforcement Ombudsman, assist the
functioning of regional small business fairness boards;
``(4) assist in enlisting the cooperation and assistance of
public and private agencies, businesses, and other
organizations in disseminating information about the programs
and services provided by the Federal Government that are of
benefit to small business concerns and the means by which
small business concerns can participate in or make use of
such programs and services; and
``(5) carry out such duties pursuant to the mission of the
Office of Advocacy as the Chief Counsel may assign.''.
SEC. 7. OVERHEAD AND ADMINISTRATIVE SUPPORT.
Section 205 of Public Law 94-305 (15 U.S.C. 634e) is
amended by inserting before ``Each department'' the
following:
``(a) The Administrator of the Small Business
Administration shall provide the Office of Advocacy with
appropriate and adequate office space at central and field
office locations of the Administration, together with such
equipment, office supplies, communications facilities, and
personnel and maintenance services as may be necessary for
the operation of such offices.
``(b)''.
SEC. 8. REPORTS.
Section 206 of Public Law 94-305 (15 U.S.C. 634f) is
amended by striking ``The Chief Counsel may'' and all that
follows through ``on his activities.'' and inserting the
following:
``(a) Not less than annually, the Chief Counsel shall
submit to the President, the Committee on Small Business of
the House of Representatives, the Committee on Small Business
and Entrepreneurship of the Senate, the Committee on
Government Affairs of the Senate, the Committee on Government
Reform of the House of Representatives, and the Committees on
the Judiciary of the Senate and the House of Representatives,
and the Administrator of the Small Business Administration a
report on agency compliance with chapter 6 of title 5, United
States Code.
``(b) In addition to the reports required by this title,
the Chief Counsel may prepare and publish such other reports
as the Chief Counsel determines appropriate.
``(c)''.
SEC. 9. AUTHORIZATION OF APPROPRIATIONS.
Section 207 of Public Law 94-305 (15 U.S.C. 634g) is
amended by striking ``not to exceed $1,000,000'' and
inserting ``$10,000,000 for fiscal year 2003, $12,000,000 for
fiscal year 2004, and $14,000,000 for fiscal year 2005''.
SEC. 10. CONFORMING AMENDMENTS.
(a) Executive Pay Schedule.--Title 5, United States Code,
is amended--
(1) in section 5314 by adding at the end the following:
``Chief Counsel for Advocacy, Small Business
Administration.''; and
(2) in section 5315 by striking the following:
``Chief Counsel for Advocacy, Small Business
Administration.''.
(b) Rural Tourism Training Program.--Section 311 of the
Small Business Administration Reauthorization and Amendments
Act of 1990 (15 U.S.C. 653 note; 104 Stat. 2832) is amended
by striking ``Chief Counsel for Advocacy'' and inserting
``Administrator''.
(c) Small Business and Agriculture Regulatory Enforcement
Ombudsman.--Section 30(b)(2) of the Small Business Act (15
U.S.C. 657(b)(2)) is amended--
(1) in subparagraph (D), by striking ``and'' at the end;
(2) in subparagraph (E), by striking the period and
inserting ``; and''; and
(3) by adding at the end the following:
``(F) enter into a memorandum of understanding with the
Office of Advocacy regarding methods and procedures for
cooperation between the Ombudsman and the Office of
Advocacy.''.
The SPEAKER pro tempore. Pursuant to the rule, the gentleman from
Illinois (Mr. Manzullo) and the gentlewoman from New York (Ms.
Velazquez) each will control 20 minutes.
The Chair recognizes the gentleman from Illinois (Mr. Manzullo).
General Leave
Mr. MANZULLO. Mr. Speaker, I ask unanimous consent that all Members
may have 5 legislative days within which to revise and extend their
remarks and include extraneous material on this legislation.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from Illinois?
There was no objection.
Mr. MANZULLO. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, 2 weeks ago we celebrated National Small Business Week
and the entrepreneurial spirit that makes this Nation great. Small
business drives our Nation's economy and the heart of our communities.
Small businesses account for 99.7 percent of the Nation's employers.
Small businesses employ 53 percent of the private workforce and are
responsible for over 50 percent of the private gross domestic product.
During this time of economic uncertainty, it is important to remember
that small businesses have pulled this Nation out of every downturn.
Small businesses create about three-fourths of the new jobs in this
country.
{time} 1915
That is why it is critically important that we in Congress do all we
can to foster the entrepreneurial spirit in America.
After all the festivities are over, it is especially important that
we carry on the legacy of National Small Business Week throughout the
year by strengthening and making the Office of Advocacy at the Small
Business Administration more independent. Advocacy is a very small, but
unique and dynamic, government office. Mr. Speaker, I encourage my
colleagues that if you do not know too much about this office, it is
time you became more familiar with its mission and its hard-working
personnel.
Advocacy is staffed with public servants who truly have a heart for
small business. It is a great resource, particularly for caseworkers
that may not know to whom to turn in order to resolve a complex small
business problem. It is one of the few offices in the executive branch
that can take positions contrary to the administration on behalf of
small business. Advocacy serves as an internal government watchdog in
our regulatory process to make sure that the interests of small
businesses are not ignored as agencies develop, propose and finalize
their regulations.
Advocacy has concluded that Federal regulations cost small businesses
about 60 percent more per employee than it costs large businesses.
Compliance with regulations averages about $7,000 per employee. That is
a huge burden. The Regulatory Flexibility Act was passed in 1980 to
require agencies to factor into their analysis the impact of
[[Page H2786]]
proposed regulations on small businesses prior to their implementation,
and, if necessary, modify the proposal to soften the impact on small
businesses.
Last March the President gave a historic address before our Nation's
women entrepreneurs. The President said, ``Every agency is required to
analyze the impact of new regulations on small businesses before
issuing them. That is an important law. The problem is it is oftentimes
being ignored. The law is on the books; the regulators don't care that
the law is on the books. From this day forward, they will care that the
law is on the books.''
The main mission of the Office of Advocacy is to carry out the
President's vision by making sure that all regulators finally take
seriously the obligations contained in the Regulatory Flexibility Act
to respect the interests of small business. Part of the President's
small business agenda is to enhance the Office of Advocacy.
The bill before us today strengthens and improves the office to
ensure that there is an entity within the executive branch that has the
statutory independence and adequate financial resources to be an
effective fighter for small business. Many small business groups,
including the National Federation of Independent Business, the Small
Business Legislative Council, the U.S. Chamber of Commerce, National
Small Business United and the National Association for the Self-
Employed have endorsed this bill.
The Small Business Advocacy Improvement Act raises the rank of the
Chief Counsel for Advocacy one level in the executive service schedule
to be on par with many of his colleagues in other agencies. The
legislation would permit the appointment of two deputy chief counsel,
one responsible for regulations, the other for economic research and
studies. The bill also defines for the first time the duties of
regional advocates, one at each of the 10 Federal regions. The SBA is
also required to provide adequate office space, equipment, and
personnel to the Office of Advocacy.
In addition, this legislation encourages more cooperation and
coordination through a memorandum of understanding between the SBA's
Office of Ombudsman, which oversees how Federal agencies implement
regulations after they are adopted, and the Office of Advocacy, which
aims to make proposed regulations more friendly to small businesses
prior to their final adoption.
Most importantly, this bill protects the budget of the Office of
Advocacy by allowing Congress to see the chief counsel's initial budget
request to the Office of Management and Budget. Unfortunately, Advocacy
has been threatened in the past with budget cuts unless the chief
counsel changed his policy with respect to small business to be more in
line with the administration. This provision is crucial to maintaining
the independence of the Office of Advocacy, because, without it, other
executive branch agencies could threaten its budget to influence a
particular course of action. This bill would shed light on that
practice in order to put enough pressure to end it.
Finally, the legislation authorizes modest increases in the budget of
the Office of Advocacy over the next 3 years in order to increase its
role and visibility within the executive branch to advocate for and on
behalf of small businesses.
Mr. Speaker, I want to thank the ranking minority member, the
gentlewoman from New York (Ms. Velazquez), for working with me over the
past 14 months on this issue. I urge my colleagues to support the Small
Business Advocacy Improvement Act.
Mr. Speaker, passage of this bill is particularly appropriate today,
shortly after National Small Business Week, because H.R. 4231 will
produce untold benefits for our small business constituents for years
to come.
Mr. Speaker, I reserve the balance of my time.
Ms. VELAZQUEZ. Mr. Speaker, I yield myself such time as I may
consume.
Mr. Speaker, even though small businesses serve as the engine of the
economy, the critical role they play is often overlooked during the
development and implementation of Federal policies. This oversight
often results in a myriad of problems and regulations that have little
benefit, or, in some cases, negative impact on this Nation's small
businesses.
To make sure small business has a voice in the Federal Government,
Congress created the Small Business Administration Office of Advocacy
25 years ago to defend, strengthen and represent small businesses in
the legislative and executive rule-making process. To accomplish this,
Advocacy, and in particular the chief counsel, has the unique power to
take positions that are contrary to the administration. This ability to
``call them as he sees them'' allows Advocacy to put aside much of the
partisan tone that all too often creeps into policy, and has just one
standard: is it good for this Nation's small businesses?
Under this charge, the Office of Advocacy works to reduce legal and
regulatory mandates that disproportionately burden small businesses. By
bringing together Federal agencies, small businesses and interest
groups, Advocacy then attempts to reach a mutually beneficial
consensus. The result is an improved regulation that reduces regulatory
and paperwork burdens so that small businesses can get back to the work
they do best.
In addition, Advocacy highlights policies that support the
development and growth of small businesses and produces studies and
research aiding legislators and rule-makers in the decisions that
affect small businesses.
As the complexity of Federal regulations has increased, so has the
need to ensure that Advocacy's independent voice is in no way muffled.
To do its job and do it well, Advocacy must point out problems and
shortcomings of administration policy, not a particularly popular job
to have, but a critical one. This often pits them against agencies and
many times opposes the Office of Management and Budget, the very agency
that sets Advocacy's funding levels each year.
Criticizing the very entity that holds its fate could compromise
Advocacy's ability to be truly independent. Given the recent
mishandling by OMB of such matters as the SBA loan program subsidy
rates and size standards for disaster assistance, shielding Advocacy
from OMB's heavy hand is more important than ever.
To that end, the Committee on Small Business provided the Office of
Advocacy the ability to submit its own budget to Congress in our
original bill. Unfortunately, this critical guarantee of Advocacy's
independence has been removed from the final version under
consideration today. I find this curious. The Office of Advocacy
already submits testimony, correspondence and reports to Congress
without any vetting by the administration. It only makes sense that
this independence should be extended to the budget it submits to
Congress. The power of a subordinate agency to submit a budget item is
not without precedent. Currently, FDIC and the International Trade
Commission, among others, submit their budget without change.
Testimony by experts before our hearings, committee reports and
surveys of small business interest groups have all influenced the
bipartisan proposal to secure Advocacy's independence. In fact, all the
business groups supported the bill as it was reported by the committee,
not as it was amended. We know that OMB's current budgetary power over
the Office of Advocacy can hurt, co-opt or weaken the office, which
will be less likely to raise issues with OMB that directly harm small
businesses.
We should have retained the original language of this bill. I am
afraid today's proposal is not a step forward, but a step back, in the
drive to protect small businesses from disproportionate government
regulations and compliance burdens. The Office of Advocacy has been
successful because we have given it the flexibility to work with
agencies to find creative solutions to the problems facing this
country's small businesses.
Small businesses are powerful creators of growth and jobs, something
to keep in mind as our unemployment rate peaks at 6 percent. The Office
of Advocacy is a strong voice for small business, and we can make it
stronger so that small businesses can get back to work. We should be
strengthening it, not weakening it, as this legislation does today.
Mr. Speaker, I have no further requests for time, and I yield back
the balance of my time.
[[Page H2787]]
Mr. MANZULLO. Mr. Speaker, I have no further requests for time, and I
yield back the balance of my time.
The SPEAKER pro tempore (Mr. Simpson). The question is on the motion
offered by the gentleman from Illinois (Mr. Manzullo) that the House
suspend the rules and pass the bill, H.R. 4231, as amended.
The question was taken; and (two-thirds having voted in favor
thereof) the rules were suspended and the bill, as amended, was passed.
A motion to reconsider was laid on the table.
____________________