Overview
Title
To amend title 5, United States Code, to require greater transparency for Federal regulatory decisions that impact small businesses, and for other purposes.
ELI5 AI
The Prove It Act of 2024 wants the government to be more open about new rules that could make things harder for small businesses. It makes sure small businesses can check and talk about these rules before they are final, so everyone knows what’s happening.
Summary AI
H.R. 7198, titled the “Prove It Act of 2024,” aims to increase transparency in federal regulatory decisions affecting small businesses. The bill requires agencies to thoroughly analyze and disclose the potential indirect costs of proposed rules on small entities. Moreover, it allows small entities or organizations to petition for a review if they believe a proposed rule will have a significant economic impact. The legislation also mandates that agencies publish guidance documents and invite feedback on rules that significantly affect small entities, ensuring openness and accountability in the regulatory process.
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AnalysisAI
General Summary of the Bill
House Bill 7198, titled the "Prove It Act of 2024," aims to increase transparency in federal regulatory decisions affecting small businesses. The bill proposes amendments to Title 5 of the United States Code to detail how small businesses can require agencies to consider both direct and indirect costs when implementing new rules. It establishes procedures that allow small businesses to challenge these regulations if they believe they will be negatively impacted. Moreover, the bill mandates the publication of guidance documents for public commentary and enforces a periodic review of rules affecting small businesses.
Summary of Significant Issues
One of the bill's persistent challenges is the ambiguity surrounding what constitutes a "significant economic impact" and a "substantial number of small entities." This lack of clarity could lead to inconsistent implementation across various agencies and diminish the legislation's intended impact.
The procedures outlined in the bill can be complex, particularly the process for small entities to file petitions challenging regulatory decisions. The complexity might deter businesses from participating, especially if they lack the resources to navigate the legal intricacies.
Another critical issue is the limited 30-day timeframe for the Chief Counsel to carry out a full review of a challenged rule. This timeline may be insufficient for a thorough examination of complex cases.
In terms of enforcement, if a federal agency fails to comply with specified consultation or review processes, the penalties—such as non-application of a rule to small entities—may have unforeseen consequences on agency operations without clear guidelines on execution.
Broad Public Impact
The bill intends to enhance accountability and transparency in federal regulatory procedures, potentially leading to more informed and balanced rule-making that considers the needs of small businesses. This approach could lead to a more business-friendly environment, encouraging entrepreneurship and innovation.
However, the broad application of the bill might result in delays in rule implementation due to the procedural hurdles and reviews it mandates. These delays could affect how quickly necessary regulatory protections are put in place, which might have implications for public well-being and environmental concerns, depending on the rules in question.
Impact on Specific Stakeholders
Small Businesses: These entities stand to benefit from the bill as it provides them with a mechanism to challenge regulations they perceive as detrimental. This potential for increased influence could help ensure that regulations are fair and economically sensible. However, the complexity and potential need for legal support might discourage smaller enterprises with limited resources from participating fully.
Federal Agencies: The bill could introduce additional bureaucratic layers to the rule-making process. This complexity might hamper the agencies' ability to efficiently roll out new regulations, particularly if faced with numerous challenges from small businesses.
Legal and Advocacy Groups: Entities that provide legal advice or advocacy could see increased demand for their services, as small businesses may require assistance in navigating the petition process and interpreting legal terms.
The Public: While increased transparency could eventually lead to regulations that better account for economic impacts on small businesses, the potential delays and legal complexities could also slow the enactment of necessary rules. This, in turn, impacts how swiftly the public can expect government action on wide-ranging issues.
In conclusion, while the Prove It Act of 2024 endeavors to empower small businesses and ensure that federal regulatory actions are both transparent and just, its efficacy remains contingent on addressing the bill's ambiguities and procedural challenges.
Issues
The definition of what constitutes a 'significant economic impact' and 'substantial number of small entities' is unclear throughout the bill. This could lead to inconsistent application across different agencies, affecting the effectiveness of the legislation. This issue is prevalent in Sections 2, 605A, and 3.
The penalties outlined in Section 605A for agency non-compliance, such as not applying the final rule to small entities, could have unintended consequences on agency operations and may lack detailed execution guidelines.
Section 2 introduces a complex petition and review process for small entities to challenge agency certifications. This complexity might deter small businesses from engaging due to the potential need for legal expertise.
The timeframe for a full review, as mandated by Sections 605A and 2, is limited to 30 days after commencement, which may not be sufficient for comprehensive analysis, especially for complex regulations.
Section 4 lacks clarity on the definition of 'conducting a review,' potentially leading to ambiguity in how agencies comply with the 10-year rule review requirement, which could affect regulatory oversight.
The amendment in Section 4 allows for rule reinstatement without traditional notice and comment rulemaking procedures, raising concerns about bypassing established legislative processes and checks.
Section 3 does not specify a timeline for publishing guidance documents, potentially leading to delays in regulatory transparency and compliance by agencies.
Sections
Sections are presented as they are annotated in the original legislative text. Any missing headers, numbers, or non-consecutive order is due to the original text.
1. Short title Read Opens in new tab
Summary AI
The first section of this Act states its official short title, which is the “Prove It Act of 2024.”
2. Initial regulatory flexibility analysis Read Opens in new tab
Summary AI
The section sets procedures for how small businesses can challenge government rules that they believe will negatively impact them. It allows these businesses to petition the Small Business Administration to review whether the economic impact has been properly considered, with clear steps for filing petitions, reviewing them, and potentially requiring further analysis or penalties for non-compliance by agencies.
605A. Review procedures relating to initial regulatory flexibility analysis certifications Read Opens in new tab
Summary AI
Any small business or group can ask the Small Business Administration to review whether a new rule will negatively impact them. If the initial review finds potential harm, the Administration will meet with involved parties and decide if a deeper assessment is necessary. If an agency doesn't help with this review, the rule won't apply to small businesses.
3. Publication of guidance Read Opens in new tab
Summary AI
The new amendment to Section 609 of title 5 of the United States Code requires that any government rule expected to significantly affect many small businesses must be accompanied by published guidance documents on a website like regulations.gov. Additionally, it mandates providing an opportunity for public comments to help small businesses give feedback on these documents.
4. Review procedures for section 610 periodic review of rules Read Opens in new tab
Summary AI
The section describes changes to the procedures for reviewing federal rules, including considering indirect costs over a 10-year period and actions to be taken if a review is not conducted on time. It outlines steps for reinstating a rule if an agency fails to review it within the given timeframe, requiring public notification and comment, and providing the agency with 180 days to complete the review once it decides to reinstate the rule.