Capitol Hill

A real chance for reform

With a new pro-business majority in Congress in 2015, NRCA is working to advance legislation designed to address a top priority for its members: providing relief from burdensome regulations. The House of Representatives already has approved two regulatory reform bills, and the outlook for passage in the Senate is better than at any time in recent memory.

The issue

NRCA is focused on regulatory reform because of many concerns members have about the dramatic increase in new regulations being issued by the federal government. In recent years, numerous regulations have been promulgated by the Department of Labor, Occupational Safety and Health Administration, National Labor Relations Board and other federal agencies that significantly affect employers in the roofing industry.

The cost of this expansion of regulations to the U.S. economy is significant. In 2011, the Small Business Administration estimated the total cost of compliance with all federal regulations throughout the nation was $1.75 trillion annually. In 2013, the Competitive Enterprise Institute, a market-oriented think tank, estimated the nationwide cost at $1.9 trillion. With more regulations in the pipeline, there is no end in sight to this trend. And NRCA expects the Obama administration to be active in issuing regulations during the president's final two years in office.

NRCA has been working for years with members of Congress and allied organizations to develop legislation to reform the process under which federal agencies develop regulations. The proposed reforms would provide a more transparent process for developing regulations so affected stakeholders have more opportunities to provide input earlier in the process regarding how proposed regulations affect employers.

The bills

During the past few years, NRCA supported several regulatory reform measures that were approved by the House of Representatives. Unfortunately, these bills died when the Senate failed to consider them. But with a pro-business majority now in the Senate, NRCA and other business groups are renewing efforts to pass regulatory reform legislation. These efforts are focused on several approaches to reforming the regulatory process to prevent rules that have onerous effects on employers.

First, the Regulatory Accountability Act (H.R. 185) was approved by the House in early January with significant bipartisan support. This legislation is designed to reform the federal rulemaking process under the Administrative Procedure Act, the primary law governing federal agency procedures, which has not been updated in nearly 70 years.

If enacted, this bill would require federal agencies to choose the lowest-cost rulemaking alternative that meets statutory objectives; improve agency fact-finding processes; require formal rulemaking to increase opportunities for public input; and fortify judicial review of new regulations.

Another bill is the Small Business Regulatory Flexibility Improvements Act (H.R. 527), which was approved by the House in February. This bill is designed to strengthen the existing Regulatory Flexibility Act, originally enacted in 1980, by putting in place stronger protections for small businesses against intrusive regulations.

Specifically, H.R. 527 requires regulators to conduct a more comprehensive analysis of the effects of regulatory proposals on job creation; consider the direct and indirect effects of regulations on small businesses; ensure existing regulations are periodically reviewed for effectiveness by federal agencies; require agencies to conduct economic analyses before issuing guidance documents; and expand the small-business advocacy review panel process.

NRCA is pleased these regulatory reform bills were approved by the House with significant bipartisan support. The goal now is to get the requisite 60 votes needed to move the bills through the Senate sometime this year, and that appears achievable with a strong grassroots lobbying effort by NRCA and allied business groups.

A veto threat

Assuming one or both bills are approved by the Senate, getting President Obama to sign either is another challenge. The administration issued veto threats on both bills during House consideration, indicating the proposed reforms would impose unnecessary new procedures on agencies and invite frivolous litigation. However, depending on how the debate plays out in the Senate, the president may come under pressure from some lawmakers in his party to sign any bill that makes it to the White House.

Look for your opportunity to weigh in on this issue with your senators through an NRCA Action Alert, which will be sent to members later this year.

Duane L. Musser is NRCA's vice president of government relations.


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