OFFICE OF THE SECRETARY 

CORRESPONDENCE CONTROL TICKET

Date Printed: Apr 03, 2002 19:21

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FILE LOCATION:

LTR-02-0243 

EDO

Thomas Sullivan (SBA) 

SBA 

HEADS OF AGENCIES

LOGGING DATE: 04/03/2002 

DEDR 

DEDM 

AO

Concerns Memorandum of Understanding Between the Office of Advocacy and the Office of 

Information and Regulatory Affairs 

Appropriate 

03/29/2002 

No 

OCM #10006 

RF

ADAMS

DATE DUE: DATE SIGNED:

P- elb:Sa-CY-6 I
Office of Advocacy

Memorandum 

To: Heads of Executive Agencies 

General Counsels 

Agency Regulatory Staff 

From: Thomas M. Sullivan, Chief Counsel for Advocacy 

Date: March 29, 2002 

Subject: Memorandum of Understanding Between the Office of 

Advocacy and the Office of Information and Regulatory 

Affairs 

On March 19, 2002, President Bush announced an historic memorandum of 

understanding (MOU) between the Office of Advocacy at the U.S. Small 

Business Administration (Advocacy) and the Office of Information and 

Regulatory Affairs at the Office of Management and Budget (OIRA). The 

purpose of the MOU is to ensure that Advocacy and OIRA work closely 

together to ensure that small business issues, particularly as they relate to 

disproportionate regulatory burden, are addressed as early as possible in the 

regulation writing process. The MOU is part of the President's overall small 

business agenda that gives small businesses the support they need to 

continue to drive this nation's economy. A copy of the MOU is attached for 

your convenience and the President's agenda is fully outlined in the following 

Web site, http://www.whitehouse.gov/infocus/smallbusiness. 

What the MOU does do: 

0 Fosters an information sharing process between Advocacy and OIRA during the 

executive review process. 

* Helps ensure that agencies make a good faith effort to comply with the Regulatory 

Flexibility Act (RFA). Failure to comply may result in a recommendation by 

Advocacy to OIRA to issue a "return letter." 

o Provides for RFA compliance training opportunities for Federal agencies.

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* Requires Advocacy and OIRA to act expeditiously on urgent matters related to 

health, safety, environmental and homeland security. 

* Requires Advocacy to issue guidance on RFA compliance. 

What the MOU does not do: 

The MOU should not in itself create additional burden for Federal agencies. If 

Federal agencies are complying with the RFA, and considering less burdensome 

regulatory alternatives that fit within the agency's policy objectives, then it is likely 

that no additional work will be required by the agencies. In the near future, the 

President will be issuing an Executive Order to place further emphasis on the 

importance of regulatory reduction for small entities. 

Advocacy maintains a Web site containing industry-based small business data, all 

official Advocacy conmment letters, guidance on how to comply with the RFA (which 

will be updated in the coming months), and the text of several relevant laws such as 

the RFA, the Administrative Procedure Act, the Paperwork Reduction Act, etc. The 

Internet address is http://www.sba.gov/advo. 

If you have any questions or concerns regarding the MOU or the RFA, please feel 

free to contact Shawne Carter McGibbon, Director of Interagency Affairs for the 

Office of Advocacy at 202-205-6945, or at shawne.carter@sba.gov. 

MEMORANDUM OF UNDERSTANDING 

BETWEEN 

THE OFFICE OF ADVOCACY, U.S. SMALL BUSINESS ADMINISTRATION 

AND 

THE OFFICE OF INFORMATION AND REGULATORY AFFAIRS, 

OFFICE OF MANAGEMENT AND BUDGET 

I. BACKGROUND 

The Office of Advocacy of the U.S. Small Business Administration (Advocacy) and 

the 

Office of Information and Regulatory Affairs of the Office of Management and 

Budget 

(OIRA) recognize that small entities (including small businesses, non-profit 

organizations 

and small governmental jurisdictions), as defined in 5 U.S.C. § 601, often face a 

disproportionate share of the Federal regulatory burden compared with their larger 

counterparts. Advocacy and OIRA further recognize that the best way to prevent
[FARM!--j

unnecessary regulatory burden is to participate in the rulemaking process at the 

earliest 

stage possible and to coordinate both offices to identify draft regulations that likely 

will 

impact small entities. 

Inasmuch as Advocacy and OIRA share similar goals, the two agencies intend to 

enhance 

their working relationship by establishing certain protocols for sharing information 

and 

providing training for regulatory agencies on compliance with the Regulatory 

Flexibility 

Act (RFA) and various other statutes and Executive orders that require an economic 

analysis of proposed regulations. 

IL PURPOSE 

The purpose of this Memorandum of Understanding (MOU) between Advocacy and 

OIRA is to achieve a reduction in unnecessary regulatory burden for small entities. 

This 

initiative also is intended to generate better agency compliance with the RFA and 

other 

statutes and Executive orders requiring an economic analysis of proposed regulations. 

III. AUTHORITY 

This agreement is under the authority of 15 U.S.C. § 634(a) et seq., 5 U.S.C. § 601 et 

seq., Executive Order 12866, as amended, and other relevant provisions of law. 

IV. OBJECTIVES 

To the extent consistent with Advocacy and OIRA authority, Advocacy and OIRA 

agree 

to accomplish the following objectives: 

a. Establish an information sharing process between Advocacy and OIRA 

when a draft rulemaking is likely to impact small entities. 

b. Establish Advocacy guidance for Federal agencies on the requirements of 

the RFA. 

c. Establish training for Federal agencies on compliance with the RFA. 

V. SCOPE 

Nothing in this MOU shall be construed to limit or otherwise affect the authority of 

the 

Office of Advocacy as established in 15 U.S.C. § 634a et seq. or the authority, 

management or policies of OIRA. 

VI. RESPONSIBILITIES 

a. Advocacy 

1. During OIRA's review of an agency's rule under Executive Order 

12866, OIRA may consult with Advocacy regarding whether an agency 

should have prepared a regulatory flexibility analysis. Advocacy will 

designate staff by issue and/or agency to facilitate such discussions. If 

OIRA is uncertain as to small business impact or RFA compliance, 

OIRA may send a copy of the draft rule to Advocacy for evaluation.
I a f -1*-

2. If Advocacy's discussions with an issuing agency do not result in an 

acceptable accommodation, Advocacy may seek the assistance of 

OIRA during the regulatory review process under Executive Order 

12866 and may recommend that OIRA return the rule to the agency for 

further consideration. 

3. Advocacy will monitor agency compliance with the RFA by reviewing 

the semi-annual regulatory agenda and the analyses that agencies 

publish in the Federal Register. Similarly, Advocacy will review the 

regulatory flexibility analyses that agencies provide directly to 

Advocacy. If Advocacy finds that a rule does not comply with the 

RFA, Advocacy will raise these concerns with OIRA. 

4. Advocacy shall provide OIRA with a copy of any correspondence or 

formal comments that Advocacy files with an agency concerning RFA 

compliance. 

3 

5. Advocacy will develop guidance for agencies to follow on how to 

comply with the RFA. 

6. Advocacy will organize training sessions for Federal agencies on how 

to comply with the analytical requirements of the RFA. 

b. OIRA 

Consistent with OIRA's responsibility to ensure adequate interagency 

coordination, OIRA shall endeavor to do the following: 

1. During OIRA's prepublication review of an agency's rule pursuant to 

Executive Order 12866, OIRA will consider whether the agency should 

have prepared a regulatory flexibility analysis. If Advocacy has a concern 

in this regard, OIRA will provide a copy of the draft rule to Advocacy. In 

addition, upon request, OIRA may, as appropriate, provide Advocacy with 

draft proposals and accompanying regulatory analyses, 

2. If, in the judgment of Advocacy or OIRA, an agency provides an 

inadequate regulatory flexibility analysis, or if an agency provides a rule 

with an inadequate certification pursuant to section 605 of the RFA, OIRA 

may discuss and resolve the matter with the agency in the context of the 

regulatory review process under Executive Order 12866. Where OIRA 

deems it appropriate, OIRA may return a rule to the agency for further 

consideration. 

3. If Advocacy or OIRA are concerned about an information collection 

requirement contained in a rule which OIRA is reviewing under the 

Paperwork Reduction Act, OIRA may discuss and resolve the matter with 

the agency. 

4. OIRA will endeavor to provide assistance, as appropriate, at the request of 

Advocacy in support of its development of guidance for agencies to follow 

in complying with the RFA and its training sessions on the analytical 

requirements of the RFA. 

c. Joint Advocacy-OIRA Responsibilities 

For rulemakings and information collection requests related to urgent health, 

safety, environmental, and homeland security matters, Advocacy and OIRA shall
V. I A

endeavor to cooperate and discuss their concerns Hi an expeditious manner. 

4 

VII. TERM 

This MOU shall take effect on the date of signature of both parties, and will remain in 

effect for three years, at which time it may be renewed by mutual agreement of 

Advocacy 

and OIRA. 

VIII. AMENDMENT 

This MOU may be amended in writing and at any time by mutual agreement of 

Advocacy's Chief Counsel or his/her designee and the Administrator of OIRA or 

his/her 

designee. 

XI. TERMINATION 

Either Advocacy or OIRA may terminate this MOU upon 90 days advance written 

notice. 

X. POINTS OF CONTACT 

Points of contact for this MOU are as follows: 

For Advocacy: 

Thomas M. Sullivan 

Chief Counsel 

Office of Advocacy 

U.S. Small Business Administration 

409 Third Street, SW 

Suite 7800 

Washington, DC 20416 

(202) 205-6533 

(202) 205-6928 (fax) 

For OIRA: 

Dr. John D. Graham 

Administrator 

Office of Information and Regulatory Affairs 

Office of Management and Budget 

262 Old Executive Office Building 

Washington, DC 20503 

(202) 395-4852 

(202) 395-3047 (fax)
Fax Transmission Cover Sheet

U.S. Small Business Administration

To: Nuclear Regulatory Commission 

Organization: 

Telephone: Fax: 301-415-1757 

Date: Monday, April 01, 2002 Time: 11:38:20 AM EST

Number of pages (including this page): 6 

FROM: Hamilton, Angela T. 

Office: Office of Advocacy 

Telephone: (202) 205-6532 

Fax: (202) 481-5771 

MESSAGE: RE: Memo to Agency Heads and Agency GC's

Didyou know that in fiscal year 2001 

the SBA

" backed more than $16.5 billion in financing to 

America's small businesses? 

" approved more than 50,000 loans totaling almost 

$12.2 billion? 

" invested $4.5 billion in small businesses through its 

venture-capital program? 

" provided more than 48,000 loans totaling 

approximately $1 billion to disaster victims for 

residential, personal-property and business loans'? 

" gave management and technical assistance to an 

estimated 1.3 million entrepreneurs through its 

resource-partner program? 

" responded to almost a quarter million telephone and 

e-mail inquiries at the SBA Answer Desk? 

Did you know that America' 

25million small businesses

* employ more than 58 percent of the private 

workforce, 

a generate more than 51 percent of the nation's 

gross domestic product? 

o are the principal source of new jobs? 

Contact us at: 

1-800-U ASK SBA 

www.sba.gov 

answerdesk~sba.gov

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SBA Form 959 (11/01) Previous editions obsolete.