[Congressional Record (Bound Edition), Volume 147 (2001), Part 16]
[House]
[Page 21999]
[From the U.S. Government Publishing Office, www.gpo.gov]



             ENVIRONMENTAL REGULATIONS FOR SMALL BUSINESSES

  The SPEAKER pro tempore. Under a previous order of the House, the 
gentleman from Indiana (Mr. Pence) is recognized for 5 minutes.
  Mr. PENCE. Mr. Speaker, I had two countervailing experiences today. 
One was to travel to the botanical gardens here on the Capitol Mall and 
meet with the extraordinary personnel of the Environmental Protection 
Agency that are overseeing the decontamination at the Hart Senate 
Office Building and in the offices of the three Members of Congress who 
have been affected by anthrax contamination.
  I witnessed then, as I have witnessed in days past, extraordinary 
professionalism and a deep commitment to creating an environment that 
is safe for us and for our staff. The EPA has earned a special place in 
my heart in the last week. But then I traveled just moments later, Mr. 
Speaker, across the street where I chaired the Subcommittee on 
Regulatory Reform and Oversight where I serve as chairman on the 
Committee on Small Business.
  It was there that we took a hard look at the inadequacy of regulatory 
analyses that agencies use to support rule-making. And the special 
emphasis regrettably, Mr. Speaker, was on one agency in particular that 
was singled out by witness after witness for its poor regulatory 
analyses, and that agency was the Environmental Protection Agency.
  The hearing that we convened today was all about the way that the EPA 
goes about evaluating the cost and benefit of regulations on small 
businesses. Small business owners are very familiar with the burdens 
that Federal regulations place on them. Many studies including those 
sponsored by the Office of Advocacy of the United States Small Business 
Administration have shown that small businesses face disproportionately 
higher costs to comply with Federal regulations, including those issued 
by the EPA than their larger business counterparts. Thus, accurate 
estimates of costs, if derived from the experiences of large businesses 
often, Mr. Speaker, paint a false picture of the impact of regulations 
or the impact of an EPA regulation on a small business. And if the EPA 
misjudges the economic impact, it often produces an irrational rule 
that wages war on the vitality of small business America.
  It seems to me, Mr. Speaker, that the polestar of the rule-making 
process is that regulations should be rational. When Congress passed 
the Administrative Procedure Act of 1946, it believed that the process 
of notice, comment, and agency response to the public comment would be 
sufficient conditions to ensure rational outcome. After the regulatory 
onslaught in the 1970's which saw the creation of the EPA, and the 
enactment of many statutes that EPA implements by rule-making, Congress 
and the executive branch determined that further refinements were 
necessary.
  Congress imposed new analytical requirements to assess the impacts on 
small business and other entities. Presidents Reagan, Bush, and Clinton 
produced executive orders all in different ways mandating the analysis 
of cost and benefits. And even my own predecessor, Congressman David 
McIntosh, led the charge here on Capitol Hill to create a rational 
process whereby the regulatory state would analyze the cost of the 
regulations versus the benefit to the environment or the health and 
safety of employees.
  In 1980 Congress enacted the Regulatory Flexibility Act as well. The 
RFA represents another tool in the decisional calculus designed to 
develop rational rules. The Reg Flex Act, as it is affectionately known 
by many in small business circles, requires Federal agencies to 
consider whether their proposal for final regulations will have a 
significant economic impact on a substantial number of small 
businesses.
  Despite this legacy since 1946 of demanding a rational foundation for 
government regulations, Mr. Speaker, sadly, today at our hearing we 
heard of a very very different tale, indeed. What I heard from one 
witness after another is that not only the EPA but many Federal and 
administrative agencies pay very little regard to the difference 
between the size of businesses when they impose paperwork requirements. 
And their estimates of the cost of compliance are often far afield of 
the reality of many small businesses like the one that I started in my 
basement or like the one my late father ran throughout his lifetime in 
Columbus, Indiana.
  There is a great Biblical tale of the pharisee, Mr. Speaker, who 
heaps burden upon burden on the traveler but never lifts a finger to 
help them carry that burden. At our hearing today for the Subcommittee 
on Regulatory Reform and Oversight of the Committee on Small Business, 
we heard the need for the EPA and other elements of the administration 
in the regulatory state to cease adding burdens to travelers but now to 
begin to think about the size and scope of those enterprises, to lift 
that burden and let us begin an era of unburdening American small 
business of Federal and regulatory red tape.

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