Prove It Act of 2024

Floor Speech

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Ms. VELAZQUEZ. Mr. Speaker, I rise in opposition to H.R. 7198, the Prove It Act.

Part of the role of the Small Business Committee is to recognize the impact regulations have on small businesses and work to find ways to balance the shared goal of minimizing the burdens and achieving the intended effects of regulations.

Throughout our committee hearings, we have heard that agencies have been better about considering the impact of their rules on small entities since the passage of the Regulatory Flexibility Act.

Another tool at our disposal is the ability of advocacy to convene SBREFA panels to give small businesses an opportunity to provide input at the beginning of the rulemaking process and when it is most important.

The Office of Advocacy has been working diligently to educate and train rule-writing staff about their responsibilities, and we have seen the fruits of their labor. The analysis agencies are conducting has improved significantly.

Yet, this bill ignores the current process. Instead of strengthening it to serve the interests of small employers, the bill we are considering today would bring our rulemaking process to a grinding halt.

It will also give big corporations a powerful new tool to delay and weaken rules, causing uncertainty and harm to small employers.

By creating an unworkable quasi-judicial process within the SBA's Office of Advocacy for reviewing agency certifications, it allows any group that claims to represent small businesses to petition Advocacy to block rules that it doesn't like.

The Prove It Act also requires agencies to conduct retrospective reviews based on the indirect costs identified in the initial analysis, without recognizing that agencies may have modified the rule during the rulemaking process.

Most concerning is the broad and unchecked authority of the chief counsel to announce that a rule is no longer effective if an agency fails to conduct a retrospective review. This means a small employer that came into compliance with an existing rule could see it eliminated and then possibly reinstated sometime in the future. This is counterproductive to what my colleagues state they are trying to achieve.

Finally, today's bill implements another lengthy process without providing additional assistance to an under-resourced Office of Advocacy. If enacted, Advocacy will need to double its staff and, no surprise, this bill provides no additional resources.

CBO estimates that agencies and Advocacy will need an additional $40 million over the next 5 years to implement this act, and that doesn't include the $17 million added to the Federal deficit.

Small employers need certainty, and this bill fails to provide it. It would only serve to cause undue chaos and confusion while achieving very little to help and support our Nation's small employers. That is why I urge my colleagues to vote ``no.''
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Ms. VELAZQUEZ. Mr. Speaker, let me begin by reiterating that as the ranking member of the Small Business Committee, I recognize the impact of regulations, and I have worked to find ways to balance the shared goal of minimizing the burdens while achieving the intended effects of regulations.

The Prove It Act doesn't strike that appropriate balance. It allows big corporations to block, delay, and weaken rules. Yes, the Chamber of Commerce or NFIB could file a petition and doesn't have to identify the business that they are representing, causing uncertainty and harm to small employers. It also gives unchecked authority to the SBA's chief counsel and tasks an understaffed and under-resourced Office of Advocacy with a cumbersome and lengthy review process.

That is why I am offering a commonsense solution. My amendment will require the Office of Advocacy to train agencies on how to comply with their Regulatory Flexibility Act.

Key personnel at every rule-writing agency would be required to undergo RFA training once every 4 years. We have heard from Advocacy that when agencies have a better understanding of the RFA, it leads to more meaningful consideration of small businesses throughout the rulemaking process. Advocacy has been working diligently to train staff, and we have seen the fruits of their labor year after year.

Their training programs have made a significant difference in the rule-writing process, and requiring ongoing training will only lead to more success. Agencies have shared draft documents with Advocacy early in the rulemaking process, and Advocacy has worked to help agencies obtain reliable small business data. Their training program has led to much better analysis, and in many instances enhanced the factual basis for agency certifications or led to modifications to reduce the impact to small firms.

Mr. Speaker, we need to foster a constructive working relationship between Advocacy and Federal agencies rather than create an adversarial one. This amendment will ensure that Advocacy reaches all agencies on RFA compliance on a regular basis.

Mr. Speaker, I urge Members to support my amendment, and I reserve the balance of my time.
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Ms. VELAZQUEZ. Mr. Speaker, on that I demand the yeas and nays.

The yeas and nays were ordered.

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