To amend chapter 6 of title 5, United States Code (commonly known as the Regulatory Flexibility Act), to ensure complete analysis of potential impacts on small entities of rules, and for other purposes.

Summary: Small Business Regulatory Improvement Act - Revises the Regulatory Flexibility Act. Defines the "economic impact" of a rule to include any direct or indirect economic effects on small entities.

Requires initial regulatory flexibility analyses of a proposed rule to contain a detailed statement describing the type of small entities to which the proposed rule will apply.

Revises provisions requiring the publication by each agency of a plan for the periodic review of its rules that have a significant impact on a substantial number of small entities to determine whether they should be continued, changed, or rescinded, including to: (1) limit to two years the amount of time the period for reviewing an agency's regulations may be extended; and (2) require each agency to report annually on review results to Congress and to the Administrator of the Office of Information and Regulatory Affairs of the Office of Management and Budget (OMB).

Requires an agency to notify the Chief Counsel for Advocacy of the Small Business Administration of any draft rules that may have a significant economic impact on a substantial number of small entities either: (1) when the agency submits a draft rule to the such Office, if submission is required; or (2) if no submission to the Office is so required, at a reasonable time before publication of the rule by the agency.

Requires that final regulatory flexibility analyses include the agency's response to any comments filed on a rule by the Chief Counsel and a detailed statement of any changes made as a result.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Small Business Regulatory 
Improvement Act''.

SEC. 2. FINDINGS.

    Congress finds the following:
            (1) Small businesses are frequently the source of new 
        products, methods, and innovations.
            (2) A vibrant and growing small business sector is critical 
        to creating jobs in a dynamic economy.
            (3) Regulations designed for application to large-scale 
        entities have been applied uniformly to small businesses and 
        other small entities.
            (4) Uniform Federal regulatory and reporting requirements 
        in many instances have imposed on small businesses and other 
        small entities disproportionately burdensome demands, including 
        legal, accounting, and consulting costs.
            (5) Since 1980, Federal agencies have been required to 
        recognize and take account of the differences in the scale and 
        resources of regulated entities but have failed to do so.
            (6) Alternative regulatory approaches that do not conflict 
        with the stated objectives of the statutes the regulations seek 
        to implement may be available and may minimize the significant 
        economic impact of regulations on small businesses and other 
        small entities.
            (7) Federal agencies have failed to analyze and uncover 
        less costly alternative regulatory approaches, despite the fact 
        that the chapter 6 of title 5, United States Code (commonly 
        known as the Regulatory Flexibility Act), requires them to do 
        so.
            (8) Federal agencies continue to interpret chapter 6 of 
        title 5, United States Code, in a manner that permits them to 
        avoid their analytical responsibilities.
            (9) Significant changes are needed in the methods by which 
        Federal agencies develop and analyze regulations, receive input 
        from affected entities, and develop regulatory alternatives 
        that will lessen the burden or maximize the benefits of final 
        rules to small businesses and other small entities.
            (10) It is the intention of the Congress to amend chapter 6 
        of title 5, United States Code, to ensure that all impacts, 
        including foreseeable indirect effects, of proposed and final 
        rules are considered by agencies during the rulemaking process 
        and that the agencies assess a full range of alternatives that 
        will limit adverse economic consequences or enhance economic 
        benefits.
            (11) Federal agencies should be capable of assessing the 
        impact of proposed and final rules without delaying the 
        regulatory process or impinging on the ability of Federal 
        agencies to fulfill their statutory mandates.

SEC. 3. CLARIFICATION AND EXPANSION OF RULES COVERED BY THE REGULATORY 
              FLEXIBILITY ACT.

    Section 601 of title 5, United States Code, is amended by adding at 
the end the following new paragraph:
            ``(9) Economic impact.--The term `economic impact' means, 
        with respect to a proposed or final rule--
                    ``(A) any direct economic effect on small entities 
                of such rule; and
                    ``(B) any indirect economic effect on small 
                entities which is reasonably foreseeable and results 
                from such rule (without regard to whether small 
                entities will be directly regulated by the rule).''.

SEC. 4. REQUIREMENTS PROVIDING FOR MORE DETAILED ANALYSES.

    (a) Initial Regulatory Flexibility Analysis.--Subsection (b) of 
section 603 of title 5, United States Code, is amended to read as 
follows:
    ``(b) Each initial regulatory flexibility analysis required under 
this section shall contain a detailed statement describing--
            ``(1) the reasons why the action by the agency is being 
        considered;
            ``(2) the objectives of, and legal basis for, the proposed 
        rule;
            ``(3) the type of small entities to which the proposed rule 
        will apply;
            ``(4) the number of small entities to which the proposed 
        rule will apply or why such estimate is not available;
            ``(5) the projected reporting, recordkeeping, and other 
        compliance requirements of the proposed rule, including an 
        estimate of the classes of small entities which will be subject 
        to the requirement, the costs, and the type of professional 
        skills necessary to comply with the rule; and
            ``(6) all relevant Federal rules which may duplicate, 
        overlap, or conflict with the proposed rule, or the reasons why 
        such a description could not be provided.''.
    (b) Final Regulatory Flexibility Analysis.--
            (1) Paragraph (1) of section 604(a) of title 5, United 
        States Code, is amended by striking ``succinct''.
            (2) Paragraph (3) of such section is amended by striking 
        ``an explanation'' and inserting ``a detailed explanation''.
            (3) Paragraph (4) of such section is amended to read as 
        follows:
            ``(4) a description of the projected reporting, 
        recordkeeping, and other compliance requirements of the rule, 
        including an estimate of the classes of small entities which 
        will be subject to the requirement, the costs, and the type of 
        professional skills necessary to comply with the rule; and''.
    (c) Certification of No Impact.--Subsection (b) of section 605 of 
title 5, United States Code, is amended by inserting ``detailed'' 
before ``statement'' both places such term appears.

SEC. 5. PERIODIC REVIEW OF RULES.

    Section 610 of title 5, United States Code, is amended to read as 
follows:
``Sec. 610. Periodic review of rules
    ``(a) Not later than 180 days after the enactment of the Small 
Business Regulatory Improvement Act, each agency shall publish in the 
Federal Register and place on its website a plan for the periodic 
review of rules issued by the agency which the head of the agency 
determines have a significant economic impact on a substantial number 
of small entities. Such determination shall be made without regard to 
whether the agency performed an analysis under section 604. The purpose 
of the review shall be to determine whether such rules should be 
continued without change, or should be amended or rescinded, consistent 
with the stated objectives of applicable statutes, to minimize 
significant economic impacts on a substantial number of small entities. 
Such plan may be amended by the agency at any time by publishing the 
revision in the Federal Register and subsequently placing the amended 
plan on the agency's website.
    ``(b) The plan shall provide for the review of all such agency 
rules existing on the date of the enactment of the Small Business 
Regulatory Improvement Act within 10 years of the date of publication 
of the plan in the Federal Register and for review of rules adopted 
after the date of enactment of the Small Business Regulatory 
Improvement Act within 10 years after the publication of the final rule 
in the Federal Register. If the head of the agency determines that 
completion of the review of existing rules is not feasible by the 
established date, the head of the agency shall so certify in a 
statement published in the Federal Register and may extend the review 
for not longer than 2 years after publication of notice of extension in 
the Federal Register. Such certification and notice shall be sent to 
the Chief Counsel for Advocacy and the Congress.
    ``(c) Each agency shall annually submit a report regarding the 
results of its review pursuant to such plan to the Congress and, in the 
case of agencies other than independent regulatory agencies (as defined 
in section 3502(5) of title 44, United States Code) to the 
Administrator of the Office of Information and Regulatory Affairs of 
the Office of Management and Budget. Such report shall include the 
identification of any rule with respect to which the head of the agency 
made a determination described in paragraph (5) or (6) of subsection 
(d) and a detailed explanation of the reasons for such determination.
    ``(d) In reviewing rules under such plan, the agency shall consider 
the following factors:
            ``(1) The continued need for the rule.
            ``(2) The nature of complaints received by the agency from 
        small entities concerning the rule.
            ``(3) Comments by the Regulatory Enforcement Ombudsman and 
        the Chief Counsel for Advocacy.
            ``(4) The complexity of the rule.
            ``(5) The extent to which the rule overlaps, duplicates, or 
        conflicts with other Federal rules and, unless the head of the 
        agency determines it to be infeasible, State and local rules.
            ``(6) The length of time since the rule has been evaluated 
        or the degree to which technology, economic conditions, or 
        other factors have changed in the area affected by the rule.
    ``(e) The agency shall publish in the Federal Register and on its 
website a list of rules to be reviewed pursuant to such plan. Such 
publication shall include a brief description of the rule, the reason 
why the agency determined that it has a significant economic impact on 
a substantial number of small entities (without regard to whether it 
had prepared a final regulatory flexibility analysis for the rule), and 
request comments from the public, the Chief Counsel for Advocacy, and 
the Regulatory Enforcement Ombudsman concerning the enforcement of the 
rule.''.

SEC. 6. CHANGES TO THE REGULATORY FLEXIBILITY ACT TO COMPORT WITH 
              EXECUTIVE ORDER 13272.

    (a) Initial Regulatory Flexibility Analysis.--Section 603 of title 
5, United States Code, is amended by adding at the end the following:
    ``(d) An agency shall notify the Chief Counsel for Advocacy of the 
Small Business Administration of any draft rules that may have a 
significant economic impact on a substantial number of small entities 
either--
            ``(1) when the agency submits a draft rule to the Office of 
        Information and Regulatory Affairs at the Office of Management 
        and Budget, if submission is required; or
            ``(2) if no submission to the Office of Information and 
        Regulatory Affairs is so required, at a reasonable time prior 
        to publication of the rule by the agency.''.
    (b) Final Regulatory Flexibility Analysis.--
            (1) Inclusion of response to comments on certification of 
        proposed rule.--Paragraph (2) of section 604(a) of title 5, 
        United States Code, is amended by inserting after ``initial 
        regulatory flexibility analysis'' the following: ``(or 
        certification of the proposed rule under section 605(b))''.
            (2) Inclusion of response to comments filed by chief 
        counsel for advocacy.--Subsection (a) of section 604 of title 
        5, United States Code, is amended by redesignating paragraphs 
        (3) through (5) as (4) through (6), respectively, and by 
        inserting after paragraph (2) the following:
            ``(3) the agency's response to any comments filed by the 
        Chief Counsel for Advocacy of the Small Business Administration 
        in response to the proposed rule, and a detailed statement of 
        any changes made to the proposed rule in the final rule as a 
        result of such comments;''.