WASHINGTON – Requiring federal agencies to do a better job periodically assessing whether a regulation’s effect on small businesses is needlessly burdensome would be an economic “game-changer,” says Sen. Olympia Snowe.

Snowe joined a bipartisan group of senators — including fellow Maine Republican Sen. Susan Collins — in touting the benefits of a host of regulatory reform proposals Thursday at a hearing by the Senate Committee on Homeland Security and Governmental Affairs.

The Obama administration’s point person for federal regulations testified that lawmakers and the White House already have the legislative and administrative authority to make sure regulations aren’t overly burdensome, and that the White House should be given a chance to carry out the president’s own regulatory reform initiative before Congress steps in.

“Our view is that with the introduction of the president’s executive order, we now have the tools needed to maintain a smart and efficient regulatory framework,” said Cass Sunstein of the White House Office of Management and Budget’s information and regulatory affairs office.

Sunstein said he fears that too much legislative intrusion into how regulations are carried out may lead to costly litigation that could tie up worthwhile regulations and the attempt to alter or get rid of existing ones.

It was the first hearing for Snowe’s bill — dubbed the FREEDOM Act, for Freedom from Restrictive Excessive Executive Demands and Onerous Mandates — since she failed to win its inclusion as an amendment to two broader measures on the Senate floor.

The measure that Snowe co-authored with GOP Sen. Tom Coburn of Oklahoma got 53 votes, including those of six Democrats, on June 9 as an amendment to an economic development bill, falling short of the 60 votes it needed.

Snowe said her legislation attempts to force federal agencies to do what current law already mandates: review every rule once a decade to determine whether it should be made less burdensome or eliminated.

Snowe is not on the governmental affairs committee, but is the top Republican on the Senate Small Business Committee. She said at Thursday’s hearing that nearly three dozen small-business associations back her bill, and noted that at a committee hearing last year she was told that a 30 percent reduction in the regulatory costs for a 10-person company would save nearly $32,000, enough to hire an additional worker.

Snowe’s bill includes provisions to prevent agencies such as the Environmental Protection Agency and the Occupational Safety and Health Administration from circumventing formal rulemaking requirements by issuing informal “guidance documents,” and to allow companies to challenge whether regulators considered the impact on small businesses when proposing a rule, instead of having to wait until a rule is finalized.

Snowe said she has made changes to the bill to develop more of a bipartisan consensus. For instance, if an agency doesn’t carry out its obligation to review a rule at least once a decade, it would lose 1 percent of its budgets for salaries. That’s a change from the initial version, which wiped a rule off the books if no review was done in the prescribed time.

Snowe was far from the only senator offering proposals for overhauling the way federal regulations are written, carried out and reviewed.

Collins, the top Republican on the governmental affairs committee, recognized Snowe’s efforts in her opening remarks, but also touted her own regulatory reform bill, the Clearing Unnecessary Regulatory Burdens Act, which would place in statute the current administrative requirement for agencies to analyze the costs and benefits of regulations.

Also testifying at the hearing was Democratic Sen. Mark Warner of Virginia, who lauded Obama’s regulations review initiative but said he plans to introduce legislation to require all federal agencies to do their own analyses of rules that carry significant compliance costs for businesses.

That is done now by the White House Office of Management and Budget only for executive branch agencies such as the EPA, Warner said, not independent federal agencies such as the Federal Trade Commission.

Warner said he also wants to require agencies to come up with regulation cost savings to balance out increased costs of proposed new rules.

Democratic Sen. Mark Pryor of Arkansas, who is on the governmental affairs committee, said he, too, is working on a regulatory reform bill.

After the hearing, Collins said she and the committee’s chairman, Sen. Joe Lieberman, I-Conn., were talking about an effort to merge various regulatory reform proposals into one bill that could reach the Senate floor this year.

But a coalition of consumer, labor, environmental and other advocacy groups said big businesses’ desire for more profits and less federal oversight is the real force behind proposals for changes to the federal regulatory process. The Coalition for Sensible Safeguards said only the White House and pro-regulatory overhaul lawmakers were allowed to testify at the hearing.

Lieberman, who will play a major role in deciding what, if any, major regulatory reform bill reaches the Senate floor this year, agreed that the public wants regulations that safeguard children’s toys, the food kids eat, the environment, and the financial and banking system.

Lieberman said that although it is important to check regulations’ cost to businesses, the Obama administration’s effort to do that is producing valuable results.

Noting that lawmakers from both parties have introduced regulatory reform bills, he said, “I am not yet persuaded that such changes are necessary or even beneficial. And we must be very cautious about enacting fixed legislative changes to a process that generally has served us very well.”

MaineToday Media Washington Bureau Chief Jonathan Riskind can be contacted at 791-6280 or at:

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