To enhance compliance assistance for small businesses.

April 13, 2005

Ms. SNOWE introduced the following bill; which was read twice and referred to the Committee on Small Business and Entrepreneurship

To enhance compliance assistance for small businesses.

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 Compliance Assistance Enhancement Act of 2005'.

SEC. 2. FINDINGS AND PURPOSES.

(a) Findings- Congress finds the following:

(1) Small businesses represent 99.7 percent of all employers, employ half of all private sector employees, and pay 44.3 percent of total United States private payroll.

(2) Small businesses generated 60 to 80 percent of net new jobs annually over the last decade.

(3) Very small firms with fewer than 20 employees spend 60 percent more per employee than larger firms to comply with Federal regulations. Small firms spend twice as much on tax compliance as their larger counterparts. Based on an analysis in 2001, firms employing fewer than 20 employees face an annual regulatory burden of nearly $7,000 per employee, compared to a burden of almost $4,500 per employee for a firm with over 500 employees.

(4) Section 212 of the Small Business Regulatory Enforcement Fairness Act of 1996 (5 U.S.C. 601 note) requires agencies to produce small entity compliance guides for each rule or group of rules for which an agency is required to prepare a final regulatory flexibility analysis under section 604 of title 5, United States Code.

(5) The Government Accountability Office has found that agencies have rarely attempted to comply with section 212 of the Small Business Regulatory Enforcement Fairness Act of 1996 (5 U.S.C. 601 note). When agencies did try to comply with that requirement, they generally did not produce adequate compliance assistance materials.

(6) The Government Accountability Office also found that section 212 of the Small Business Regulatory Enforcement Fairness Act of 1996 (5 U.S.C. 601 note) and other sections of that Act need clarification to be effective.

(b) Purposes- The purposes of this Act are the following:

(1) To clarify the requirement contained in section 212 of the Small Business Regulatory Enforcement Fairness Act of 1996 (5 U.S.C. 601 note) for agencies to produce small entity compliance guides.

(2) To clarify other terms relating to the requirement in section 212 of the Small Business Regulatory Enforcement Fairness Act of 1996 (5 U.S.C. 601 note).

(3) To ensure that agencies produce adequate and useful compliance assistance materials to help small businesses meet the obligations imposed by regulations affecting such small businesses, and to increase compliance with these regulations.

SEC. 3. ENHANCED COMPLIANCE ASSISTANCE FOR SMALL BUSINESSES.

(a) In General- Section 212 of the Small Business Regulatory Enforcement Fairness Act of 1996 (5 U.S.C. 601 note) is amended by striking subsection (a) and inserting the following:

`(a) Compliance Guide-

`(1) IN GENERAL- For each rule or group of related rules for which an agency is required to prepare a final regulatory flexibility analysis under section 605(b) of title 5, United States Code, the agency shall publish 1 or more guides to assist small entities in complying with the rule and shall entitle such publications `small entity compliance guides'.

`(2) PUBLICATION OF GUIDES- The publication of each guide under this subsection shall include--

`(A) the posting of the guide in an easily identified location on the website of the agency; and

`(B) distribution of the guide to known industry contacts, such as small entities, associations, or industry leaders affected by the rule.

`(3) PUBLICATION DATE- An agency shall publish each guide (including the posting and distribution of the guide as described under paragraph (2))--

`(A) on the same date as the date of publication of the final rule (or as soon as possible after that date); and

`(B) not later than the date on which the requirements of that rule become effective.

`(4) COMPLIANCE ACTIONS-

`(A) IN GENERAL- Each guide shall explain the actions a small entity is required to take to comply with a rule.

`(B) EXPLANATION- The explanation under subparagraph (A)--

`(i) shall include a description of actions needed to meet the requirements of a rule, to enable a small entity to know when such requirements are met; and

`(ii) if determined appropriate by the agency, may include a description of possible procedures, such as conducting tests, that may assist a small entity in meeting such requirements.

`(C) PROCEDURES- Procedures described under subparagraph (B)(ii)--

`(i) shall be suggestions to assist small entities; and

`(ii) shall not be additional requirements relating to the rule.

`(5) AGENCY PREPARATION OF GUIDES- The agency shall, in its sole discretion, taking into account the subject matter of the rule and the language of relevant statutes, ensure that the guide is written using sufficiently plain language likely to be understood by affected small entities. Agencies may prepare separate guides covering groups or classes of similarly affected small entities and may cooperate with associations of small entities to develop and distribute such guides. An agency may prepare guides and apply this section with respect to a rule or a group of related rules.

`(6) REPORTING- Not later than 1 year after the date of enactment of the Small Business Compliance Assistance Enhancement Act of 2005, and annually thereafter, the head of each agency shall submit a report to the Committee on Small Business and Entrepreneurship of the Senate and the Committee on Small Business of the House of Representatives describing the status of the agency's compliance with paragraphs (1) through (5).'.

(b) Technical and Conforming Amendment- Section 211(3) of the Small Business Regulatory Enforcement Fairness Act of 1996 (5 U.S.C. 601 note) is amended by inserting `and entitled' after `designated'.

END