WASHINGTON, D.C. – Small business gains when federal agencies are sensitive to the economic consequences of new regulations, according to a report issued today by the Office of Advocacy of the U.S. Small Business Administration. By following the Regulatory Flexibility Act (RFA), federal agencies saved small businesses over $7.2 billion in foregone regulatory compliance costs in Fiscal Year 2006. The newly released Report on the Regulatory Flexibility Act FY 2006 documents these savings.

“When regulators listen to the voice of small business, agencies can finalize regulations while minimizing the cost of new mandates,” said Thomas M. Sullivan, Chief Counsel for Advocacy. “This is especially true when the concerns of small business are heard early in the regulatory process. By taking into account the concerns of small business, regulators are able to avoid the one-size-fits-all mentality that for years has disproportionately burdened small business.”

The report details the Office of Advocacy’s oversight of the RFA’s implementation. The RFA requires agencies to review the potential impact of proposed regulations on small business and other small entities. It also requires agencies to examine significant alternatives that minimize small entity impacts while still meeting the policy objectives of the regulation.

The efforts of agencies and the Office of Advocacy to implement Executive Order 13272 (signed by President Bush) are also identified. Executive Order 13272, Proper Consideration of Small Entities in Agency Rulemaking, strengthens implementation of the RFA by requiring agencies to notify Advocacy of proposed rules that will have a significant impact on a substantial number of small entities. It also requires Advocacy to train federal agencies in how to comply with the RFA.

The Office of Advocacy, the “small business watchdog” of the federal government, examines the role and status of small business in the economy and independently represents the views of small business to federal agencies, Congress, and the President. It is the source for small business statistics presented in user-friendly formats, and it funds research into small business issues.