Regulatory Watch


Background

Government regulations and red tape can be a tremendous barrier to small business growth. Small businesses' regulatory compliance costs are 36 percent higher than large businesses, so it is no surprise that regulations consistently rank as a top concern for small business owners. 

Below are regulatory proposals that have been published in the Federal Register and are open for public comment. An agency publishes an initial regulatory flexibility analysis (IRFA) with a proposed rule if it expects that the rule will have a significant economic impact on substantial number of small businesses. The IRFA provides information about the potential effects of the proposed rule on small businesses.  

Agencies' initial analyses of small business impacts are not always correct or complete, so the Committee on Small Business encourages small businesses to file comments through the government's online portal, Regulations.gov, and tell federal agencies how the regulatory proposal will affect them.

 


Regulations to Watch:

National Credit Union Administration (NCUA)

Regulatory Reform Agenda

The NCUA has established a Regulatory Reform Task Force (Task Force) to oversee the implementation of the agency's regulatory reform agenda. This is consistent with the spirit of the president's regulatory reform agenda and Executive Order 13777. Although the NCUA, as an independent agency, is not required to comply with Executive Order 13777, the agency chose to comply with its spirit and reviewed all of the NCUA's regulations to that end. The Task Force published and sought comment on its first report in August 2017. Having reviewed all of the comments received, the Task Force is publishing its second and final report. (PUBLISHED 12-21-2018)

IRFA – No

PUBLISHED 12/21/2018


Federal Communications Commission (FCC)

Promoting Investment in the 3550-3700 MHz Band

The FCC has adopted limited changes to the rules governing Priority Access Licenses (PALs) that will be issued in the 3500-3700 MHz Band (3.5 GHz band)—including larger license areas, longer license terms, renewability, and performance requirements—as well as changes to the competitive bidding rules for the issuance of PALs and to the ability to partition and disaggregate areas within PALs. These changes are consistent with the rules that helped foster the development of 4G and LTE services in the United States, and adopting similar rules in this band will help promote additional investment in the next generation of wireless services. The Commission also adopts changes to the technical rules to facilitate transmissions over wider bandwidth channels without significant power reduction and changes to the information security requirements to better safeguard commercially sensitive information and protect critical infrastructure. These targeted changes will spur additional investment and broader deployment in the band, promote robust and efficient spectrum use, and help ensure the rapid deployment of advanced wireless technologies—including 5G—in the United States. (PUBLISHED 12-7-2018)

IRFA – Yes

EFFECTIVE DATE 1/7/2019



Environmental Protection Agency (EPA)

Standards of Performance for New Residential Wood Heaters, New Residential Hydronic Heaters and Forced-Air Furnaces

The EPA is proposing to amend the 2015 New Source Performance Standards (NSPS) for new residential hydronic heaters and new forced-air furnaces by adding a two-year “sell-through” period for all affected new hydronic heaters and forced-air furnaces that are manufactured or imported before the May 2020 compliance date to be sold at retail through May 2022. This will allow retailers additional time, after the May 2020 effective date of the “Step 2” standards, for the sale of “Step 1” compliant hydronic heaters and forced-air furnaces remaining in inventory. The agency is also taking comment on whether a sell-through period for all affected new residential wood heaters is appropriate following the May 2020 compliance date and, if so, how long a sell-through period is needed and why. In addition, this action is taking comment on whether the current minimum pellet fuel requirements should be retained and, if so, whether they should be revised. The EPA has certified that this proposed rule will not impose any new requirements on any small businesses. (PUBLISHED 11-30-2018)

IRFA – No

COMMENTS DUE 1/14/2019



National Labor Relations Board (NLRB)

The Standard for Determining Joint Employer Status

The NLRB has issued a notice of proposed rulemaking clarifying whether two employers are a joint employer under the National Labor Relations Act. Specifically, this proposed rule would consider a joint employer only if the two employers share the employees' essential terms and conditions of employment, such as hiring, firing, discipline, supervision, and direction. Furthermore, an employer must possess and actually exercise substantial direct and immediate control over the essential terms and conditions of employment. The NLRB expects that the majority of the 5.88 million small businesses with employees in the United States could be impacted by this proposed rule. (PUBLISHED 9-14-2018)

IRFA - Yes

COMMENTS DUE 1-14-2019



The United States Copyright Office

Registration Modernization

The United States Copyright Office is building a new registration system that will incorporate a new technological infrastructure. This modernization is in an effort to improve the Office's processing times that meets the changing needs of individual creators, industry, copyright practitioners, and the general public. Other proposed changes include a more powerful dashboard, and an improved messaging system to confirm that a submission has been received and provide details on what to expect next. The Office is also seeking comments on whether there should be a mandate to use electronic applications and eliminate paper copyright applications. (PUBLISHED 10-17-2018)

IRFA – No

COMMENTS DUE 1-15-2019



Office of United States Trade Representative (USTR)

Negotiating Objectives for a U.S.-United Kingdom Trade Agreement

The USTR is seeking public comments on a proposed U.S.-U.K. Trade Agreement, including U.S. interests and priorities, in order to develop U.S. negotiating positions. The Administration's aim in negotiations with the U.K. is to address both tariff and non-tariff barriers and to achieve free, fair, and reciprocal trade. The USTR requests that small businesses, generally defined by the Small Business Administration as firms with fewer than 500 employees, or organizations representing small business members, submit comments so that it may be aware of issues of particular interest to small businesses. The USTR is also accepting notifications of intent to testify at a public hearing on January 29, 2019. (PUBLISHED 11-16-2018)

IRFA – No

COMMENTS DUE 1/15/2019



Federal Deposit Insurance Corporation (FDIC)

Request for Information on Small-Dollar Lending

The FDIC is seeking comments on small-dollar lending, including steps that can be taken to encourage FDIC-supervised financial institutions to offer small-dollar credit products that are responsive to customers' needs and that are underwritten and structured prudently and responsibly. The agency is seeking information on consumer demand, the benefits and risks of small-dollar credit products, the challenges that may disincentivize banks from offering small-dollar credit products, product features of these types of loans, innovations to enhance banks 'abilities to offer small-dollar loans, and alternatives that banks should consider. (PUBLISHED 11/20/2018)

IRFA – No

COMMENTS DUE 1/22/2019



Pipeline and Hazardous Materials Safety Administration (PHMSA), Department of Transportation (DOT)

Hazardous Materials: Harmonization With International Standards

The PHMSA is proposing to amend the Hazardous Materials Regulations (HMR) to maintain alignment with international regulations and standards by incorporating various amendments, including changes to proper shipping names, hazard classes, packing groups, special provisions, packaging authorizations, air transport quantity limitations, and vessel stowage requirements. These revisions are part of the agency's ongoing biennial process to harmonize the HMR with international regulations and standards. The PHMSA states that the proposed rule will apply to offerors and carriers of hazardous materials, some of whom are small entities, such as chemical manufacturers, users and suppliers, packaging manufacturers, distributors, and training companies. The agency expects that small businesses competing in foreign markets will be relieved from the burden of complying with a dual system of regulations. (PUBLISHED 11-27-2018)

IRFA – No

COMMENTS DUE 1/28/2019



Defense Acquisition Regulations System, Department of Defense (DoD)

Defense Federal Acquisition Regulation Supplement: Restrictions on Use of Lowest Priced Technically Acceptable Source Selection Process (DFARS Case 2018-D010)

The DoD is proposing to amend the Defense Federal Acquisition Regulation Supplement to implement sections of the National Defense Authorization Acts for Fiscal Years 2017 and 2018 that establish limitations and prohibitions on the use of the lowest price technically acceptable (LPTA) source selection process. The agency has stated that the proposed rule may impact some small businesses, as offerors may need to change the way their quotations or offers are structured to conform to proposal instructions and corresponding evaluation criteria when responding to solicitations that use the tradeoff source selection process for supplies or services where the LPTA source selection process is now prohibited or must now be avoided.  The DoD expects this incremental impact to be minimal. (PUBLISHED 12-4-2018)

IRFA – Yes

COMMENTS DUE 2/4/2019



Defense Acquisition Regulations System, Department of Defense (DoD)

Defense Federal Acquisition Regulation Supplement: Small Business Set-Asides for Architect-Engineer and Construction Design Contracts (DFARS Case 2018-D057)

The DoD is proposing to amend the Defense Federal Acquisition Regulation Supplement to implement section 2804 of the National Defense Authorization Act for Fiscal Year 2019, which concerns small business set-asides of acquisitions for architect-engineer services, including construction design, in connection with military construction projects or military family housing projects. Section 2804 requires these acquisitions to be set aside for small business if valued at less than $1,000,000. Section 2804 also removes the prohibition on setting aside these acquisitions; as a result, these acquisitions may now be set aside for small business, if valued at $1,000,000 or more. The DoD estimates that approximately 300 small entities could benefit from this proposed rule. (PUBLISHED 12-4-2018)

IRFA – Yes

COMMENTS DUE 2/4/2019



Department of Defense (DoD), General Services Administration (GSA), and National Aeronautics and Space Administration (NASA)

Federal Acquisition Regulation: Revision of Limitations on Subcontracting

The DoD, GSA, and NASA are proposing to amend the Federal Acquisition Regulation (FAR) to implement the final rule published by the Small Business Administration (SBA) implementing section 1651 of the National Defense Authorization Act for Fiscal Year 2013, which revised and standardized the limitations on subcontracting, including the nonmanufacturer rule, that apply to small business concerns under FAR part 19 procurements. The purpose of this rule is to implement statutory authorities and SBA regulations that are designed to make it easier and less burdensome for small business prime contractors to comply with requirements related to how much work they may subcontract under Federal contracts and task and delivery orders. The agencies expect the proposed changes to these requirements to both ease compliance costs and provide more authorized ways to subcontract. (PUBLISHED 12-4-2018)

IRFA – Yes

COMMENTS DUE 2/4/2019



U.S. Small Business Administration (SBA)

National Defense Authorization Acts of 2016 and 2017, Recovery Improvements for Small Entities After Disaster Act of 2015, and Other Small Business Government Contracting

The SBA is proposing to amend its regulations to implement several provisions of the National Defense Authorization Acts of 2016 and 2017 and the Recovery Improvements for Small Entities After Disaster Act of 2015, and other clarifying amendments. The proposed rule would clarify that contracting officers have the authority to request information in connection with a contractor's compliance with applicable limitations on subcontracting clauses; provide exclusions for purposes of compliance with the limitations on subcontracting for certain contracts performed outside of the United States, environmental remediation contracts, and information technology service acquisitions that require substantial cloud computing; require a prime contractor with a commercial subcontracting plan to include indirect costs in its subcontracting goals; establish that failure to provide timely subcontracting reports may constitute a material breach of the contract; clarify the requirements for size and status recertification; and limit the scope of Procurement Center Representative reviews of Department of Defense acquisitions performed outside of the United States and its territories. The proposed rule would also authorize agencies to receive double credit for small business goaling achievements as announced in SBA's scorecard for local area small business set asides in connection with a disaster. Finally, SBA is proposing to remove the kit assembler exception to the non-manufacturer rule. (PUBLISHED 12-4-2018)

IRFA – Yes

COMMENTS DUE 2/4/2019



Office of the Comptroller of the Currency, Treasury (OCC); Board of Governors of the Federal Reserve System (Board); and Federal Deposit Insurance Corporation (FDIC)

Real Estate Appraisals

The OCC, Board, and FDIC (collectively, the agencies) are inviting comment on a proposed rule to amend the agencies' regulations requiring appraisals for certain real estate-related transactions. The proposed rule would increase the threshold level at or below which appraisals would not be required for residential real estate-related transactions from $250,000 to $400,000. Consistent with the requirement for other transactions that fall below applicable thresholds, regulated institutions would be required to obtain an evaluation of the real property collateral that is consistent with safe and sound banking practices. The proposed rule would make conforming changes to add transactions secured by residential property in rural areas that have been exempted from the agencies' appraisal requirement pursuant to the Economic Growth, Regulatory Relief and Consumer Protection Act to the list of exempt transactions. The proposed rule would require evaluations for these exempt transactions. Pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act, the proposed rule would amend the agencies' appraisal regulations to require regulated institutions to subject appraisals for federally related transactions to appropriate review for compliance with the Uniform Standards of Professional Appraisal Practice. (PUBLISHED 12-7-2018)

IRFA – Yes

COMMENTS DUE 2/5/2019



Internal Revenue Service (IRS), Treasury

Guidance Related to the Foreign Tax Credit, Including Guidance Implementing Changes Made by the Tax Cuts and Jobs Act

The IRS is proposing regulations that provide guidance relating to the determination of the foreign tax credit under the Internal Revenue Code. The guidance relates to changes made to the applicable law by the Tax Cuts and Jobs Act (the “Act”), which was enacted on December 22, 2017. Guidance on other foreign tax credit issues, including in relation to pre-Act statutory amendments, is also included in this document. The proposed regulations provide guidance needed to comply with statutory changes and affect individuals and corporations claiming foreign tax credits. The IRS believes that the proposed regulations help reduce small businesses' compliance costs by providing clarity, certainty, and flexibility to the taxpayer regarding how to take into account the changes made by the Act in claiming foreign tax credits. (PUBLISHED 12-7-2018)

IRFA – No

COMMENTS DUE 2/5/2019



Occupational Safety and Health Administration (OSHA); Labor

Revising the Beryllium Standard for General Industry

OSHA is proposing to modify a 2017 final rule adopting a comprehensive general industry standard for occupational exposure to beryllium and beryllium compounds to clarify certain provisions and simplify or improve compliance. The agency believes the proposed changes would maintain safety and health protections for workers and are designed to enhance worker protections overall by ensuring that the rule is well-understood and compliance is more straightforward. OSHA believes this rule would not impose any new costs on small businesses and would result in cost savings. (PUBLISHED 12-11-2018)

IRFA – No

COMMENTS DUE 2/11/2019



Federal Deposit Insurance Corporation (FDIC)

Request for Information on the FDIC's Deposit Insurance Application Process

The FDIC is seeking comment from interested parties regarding the FDIC's deposit insurance application process, including with respect to the transparency and efficiency of the process, and any unnecessary burdens that have become a part of the process. The FDIC encourages comments from all interested members of the public, including but not limited to insured depository institutions, other financial institutions or companies, individual depositors and consumers, consumer groups, and other interested stakeholders. The request for information outlines 13 specific topics and questions that the FDIC is interested in receiving more information. (PUBLISHED 12-12-2018)

IRFA – No

COMMENTS DUE 2/11/2019



Federal Communications Commission (FCC)

Regulation of Business Data Services for Rate-of-Return Local Exchange Carriers; Business Data Services in an Internet Protocol Environment; Special Access for Price Cap Local Exchange Carriers

The FCC is seeking comment on proposals to eliminate ex ante pricing regulations for price cap incumbent local exchange carriers' (LECs') provision of time division multiplexing (TDM) and other transport business data services. The Commission also seeks comment on the conditions under which ex ante pricing regulations should be eliminated for lower capacity TDM transport business data services offerings by rate-of-return carriers opting in to the Commission's new light-touch regulatory framework. These proposals part of the Commission's ongoing efforts to modernize regulations for the dynamic and evolving business data services market.  The Commission believes that these proposals will impact recordkeeping and reporting requirements for price cap carriers and rate-of-return carriers. (PUBLISHED 11-29-2018)

IRFA – Yes

COMMENTS DUE 2/12/2019



Environmental Protection Agency (EPA)

Standards of Performance for New Residential Wood Heaters, New Residential Hydronic Heaters and Forced-Air Furnaces

The EPA is requesting comment on several aspects of the 2015 Standards of Performance for New Residential Wood Heaters, New Residential Hydronic Heaters and Forced-Air Furnaces (2015 NSPS) in order to inform future rulemaking to improve these standards and related test methods. This action does not propose any changes to the 2015 NSPS, but does take comment on a number of aspects of the rule, including the compliance date for the Step 2 emission limits, Step 2 emission limits for forced-air furnaces, hydronic heaters and wood heaters, Step 2 emission limits based on weighted averages versus individual burn rates, transitioning to cord wood certification test methods, compliance audit testing, third-party review, electronic reporting tool, and warranty requirements. (PUBLISHED 11-30-2018)

IRFA – No

COMMENTS DUE 2/13/2019



Small Business Administration (SBA)

Small Business HUBZone Program; Government Contracting Programs

The SBA has issued a proposed rule that would amend its regulations for the Historically Underutilized Business Zone (HUBZone) Program. Specifically, the proposed rule would revise key definitions to remove ambiguities, reorganize the eligibility requirements to make them clearer, clarify the certification process, and other revisions. The SBA estimates that there are 5,000 small businesses that participate in the program. (PUBLISHED 10-31-2018)

IFRA – Yes

COMMENTS DUE 2/14/2019



Federal Communications Commission (FCC)

Unlicensed Use of the 6 GHz Band

The FCC is proposing to expand unlicensed use of the 5.925-7.125 GHz band (6 GHz band) while protecting the incumbent licensed services that operate in this spectrum. In the 5.925-6.425 GHz and 6.525-6.875 GHz sub-bands the proposed rules will allow unlicensed access points to operate only on frequencies determined by an automated frequency control (AFC) system. In the remainder of the 6 GHz band, the 6.425-6.525 GHz and 6.875-7.125 GHz sub-bands, no AFC system will be required, and the unlicensed access points will be permitted to operate at lower transmitted power. The proposed rules will also permit unlicensed client devices to operate under the control of an access point throughout the 6 GHz band. The Commission believes that this proposed rule would provide an advantage to small businesses because they would benefit from being able to access the 6 GHz band without complication or cost of needing to obtain a license. (PUBLISHED 12-17-2018)

IRFA – No

COMMENTS DUE 2/15/2019



Internal Revenue Service (IRS), Treasury

Estate and Gift Taxes; Difference in the Basic Exclusion Amount

The IRS is proposing regulations that will affect donors of gifts made after 2017 and the estates of decedents dying after 2017. The proposed regulations address recent legislative changes to the basic exclusion amount used in computing Federal gift and estate taxes under the Tax Cuts and Jobs Act. The IRS has stated that these proposed regulations only apply to individuals and estates of deceased individuals, not small entities, but is accepting comment on the impact of the proposed regulations on small entities. (PUBLISHED 11-23-2018)

IRFA – No

COMMENTS DUE 2/21/2019



Internal Revenue Service (IRS), Treasury

Limitation on Deduction for Business Interest Expense

The IRS is proposing regulations regarding the limitation on the deduction for business interest expense after the enactment of recent tax legislation. Specifically, these regulations provide general rules and definitions. The regulations also provide rules for calculating the limitation in consolidated group, partnership, and international contexts. The regulations affect taxpayers that have deductible business interest expense, other than certain small businesses, electing real property trades or businesses, electing farming businesses, and certain utility businesses. The proposed regulation also withdraws a notice of proposed rulemaking relating to the disallowance of a deduction for certain interest paid or accrued by a corporation, and provides notice of a public hearing. The IRS does not expect the rules to have a significant economic impact on small entities. (PUBLISHED 12-28-2018)

IRFA – No

COMMENTS DUE 2/26/2019


 
Food and Drug Administration (FDA), HHS

Medical Device De Novo Classification Process

The FDA is proposing to establish requirements for the medical device De Novo classification process under the Federal Food, Drug, and Cosmetic Act (FD&C Act). The proposed requirements establish procedures and criteria related to requests for De Novo classification. These requirements are intended to ensure the most appropriate classification of devices consistent with the protection of the public health and the statutory scheme for device regulation, as well as to limit the unnecessary expenditure of FDA and industry resources that may occur if devices for which general controls or general and special controls provide a reasonable assurance of safety and effectiveness are subject to premarket approval. (PUBLISHED 12-7-2018)

IRFA – No

COMMENTS DUE 3/7/2019



Securities and Exchange Commission (SEC)

Request for Comment on Earnings Releases and Quarterly Reports

The SEC is requesting public comment on how it can enhance, or at a minimum maintain, the investor protection attributes of periodic disclosures while reducing administrative and other burdens on reporting companies associated with quarterly reporting. The SEC is specifically requesting public comment on the nature and timing of the disclosures that reporting companies are required to provide in their quarterly reports filed on Form 10-Q, including when the disclosure requirements overlap with disclosures these companies voluntarily provide to the public in the form of an earnings release furnished on Form 8-K. It is interested in exploring ways to promote efficiency in periodic reporting by reducing unnecessary duplication in the information that reporting companies disclose and how such changes could affect capital formation, while enhancing, or at a minimum maintaining, appropriate investor protection. The SEC is also requesting public comment on whether its rules should provide reporting companies, or certain classes of reporting companies, with flexibility as to the frequency of their periodic reporting. In addition, it is seeking comment on how the existing periodic reporting system, earnings releases, and earnings guidance, standing alone or in combination with other factors, may affect corporate decision making and strategic thinking—positively or negatively—including whether these factors foster an inefficient outlook among registrants and market participants by focusing on short-term results, sometimes referred to as “short-termism.” (PUBLISHED 12-21-2019)

IRFA – No

COMMENTS DUE 3/21/2019



Environmental Protection Agency (EPA)

Revisions to the Criteria for Municipal Solid Waste Landfills To Address Advances in Liquids Management

The EPA is considering whether to propose revisions to the criteria for Municipal Solid Waste Landfills (MSWLFs) to support advances in effective liquids management. EPA is seeking information relating to: Removing the prohibition on the addition of bulk liquids to MSWLFs; defining a particular class of MSWLF units (i.e., bioreactor landfill units) to operate with increased moisture content; and establishing revised MSWLF criteria to address additional technical considerations associated with liquids management, including waste stability, subsurface reactions, and other important safety and operational issues. This Advance Notice of Proposed Rulemaking (ANPRM) also discusses the results of related research conducted to date, describes EPA's preliminary analysis of that research, and seeks additional scientific studies, data, and public input on issues that may inform a future proposed rule. The EPA is not reopening any existing regulations through this ANPRM. (PUBLISHED 12-26-2018)

IRFA – No

COMMENTS DUE 3/26/2019


Regulatory Resources:

The Regulatory Flexibility Act
Regulatory Agenda
Tips for Submitting Effective Comments