The American Bankers Association last week joined the U.S. Chamber of Commerce and dozens of national and state business groups in a letter urging House lawmakers to strengthen small business input in the Regulatory Flexibility Act. The 1980 law directs federal agencies to review the effects of new mandates on small businesses and to minimize negative effects without compromising the underlying regulatory objectives.
In their letter, the business groups said loopholes in the RFA allow federal regulators to bypass the law’s requirements and misrepresent the costs of new mandates on small businesses. As one example, the groups pointed to the proposed Basel III endgame rulemaking. “Bank regulators published their perceived impact on large banks but did not publish how new mandates will make small business loans more expensive,” the groups said.
“At a time when we are counting on small business growth to enrich communities and bolster America’s economy, we cannot afford to bury free enterprise under red tape emanating from Washington,” the groups said. “We urge the [House Small Business Committee] to prioritize legislation that strengthens and closes loopholes in the Regulatory Flexibility Act.”