Small Business Resource Guide -
Chapter 10 -
The Regulatory Flexibility Act and the Small Business Regulatory Enforcement Fairness Act

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The Regulatory Fairness Program, or RegFair, is a new Small Business Administration program designed to give small businesses a greater voice in the federal regulatory enforcement and compliance process. Through RegFair, small businesses can help change the federal regulatory environment by contacting the SBA National Ombudsman or the Regulatory Fairness Board member in their area.

There are 10 regional Regulatory Fairness Boards around the country. Each board has five members who are small business owners themselves, so they understand what your small business faces when dealing with federal regulations. The boards advise the National Ombudsman, who communicates weekly with federal agencies, and reports on small business comments directly to Congress every year. In that report, the National Ombudsman rates agency efforts to be small business-friendly, and includes recommendations by small businesses for improvement.

The Small Business Regulatory Enforcement Fairness Act of 1996 (SBREFA) requires that before an agency issues a regulation, it must make a determination as to whether the regulation will have a significant economic impact on a substantial number of small businesses. If a regulation will have such an impact, the agency must conduct a more indepth economic analysis of the impact and submit and review alternative implementation strategies which could mitigate the impact.

When a Final Rule is published which does have an economic impact on small business, it must be accompanied by a �Compliance Guide� which is intended to provide a �plain English� explanation of the regulation with instructions on who to contact if a small business has additional questions.

The SBREFA also requires that in taking any enforcement action, such as an audit, inspection or compliance review a small business must be informed of its right to comment to the National Small Business Ombudsman if it believes the action is unfair. 1-800-REG-FAIR.

In addition, the SBREFA requires that agencies take into account the size of a business, its ability to pay and any mitigating circumstances in assessing penalties.

If you have a compliment, complaint or recommendation for a federal agency, there are three ways you can comment on it: 1) contact a Fairness Board Member; 2) file a one-page agency appraisal, and/or 3) testify at a RegFair hearing. To do any or all, call 1-888-REG-FAIR or visit the World Wide Web site at www.sba.gov/regfair for details.

RegFair asks agencies to respond to small business comments and inquiries about their regulatory enforcement actions. If you would like to comment on a federal regulatory issue, fill out a short, one-page agency appraisal form and send it in. Your comment, or a summary if you choose to keep confidential the identity of your business, will be sent to the federal agency involved for a review and response by a high-level agency representative. The National Ombudsman and Fairness Board ask the agency to explain the enforcement action. You will be advised of the agency�s response and of any further action by the Board or Ombudsman on your comment.

RegFair also holds public hearings to hear testimony from small businesses and federal agencies on regulatory enforcement issues. In the first two years, more than 250 small businesses have testified before the Fairness Boards on regulations in areas such as taxes, the environment, health and safety, and agriculture.

Your can testify by attending the RegFair hearing in your area. For more information on testifying, the hearings, or to read transcripts of completed hearings, check the Web site at www.sba.gov/regfair.

RegFair reports your comments to high-level, independent officials at the federal agencies involved. RegFair cannot overturn or cancel fines, penalties or other enforcement action for individual small businesses. However, upon review, agencies at times do cancel a fine or penalty for a small business.

Even more important, agencies sometimes change regulations or enforcement policies as a result of a small business comment. The National Ombudsman and Fairness Boards urge small businesses to pursue all of their legal rights and option, and to exercise their new rights under the Small Business Regulatory Enforcement Fairness Act.

The HUD Program for Implementing the Small Business Regulatory Enforcement Fairness Act can be found at http://www.hud.gov/offices/osdbu/policy/sbrefa.cfm.

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