Mr. BURTON of Indiana. Mr. Speaker, I thank the gentleman for yielding time to me.
Mr. Speaker, I think my colleagues have covered the rule very well. I thank the gentleman from Washington (Mr. HASTINGS) and the Committee on Rules for bringing an open rule down to the floor.
I think the gentleman from California (Mr. OSE) and the gentlewoman from New York (Ms. SLAUGHTER) and the gentleman from Washington (Mr. HASTINGS) have covered the bill rather well.
There are 24 million small business people in this country that have been suffering dramatically under the burden of overregulation and paperwork. This bill takes a giant step toward eliminating a lot of the problems they face.
This is supported strongly by the U.S. Chamber of Commerce. I think it is a great bill. Its time has come, as the gentleman from Washington (Mr. HASTINGS) has said.
Mr. BURTON of Indiana. Mr. Chairman, when one gets into those figures, it gets very confusing; but the fact of the matter is, it is costing small business people in this country a ton of money.
Mr. MANZULLO. Mr. Chairman, I rise today in support of H.R. 327, the Small Business Paperwork Relief Act. This bill represents an excellent start in reducing the paperwork burdens that are swamping millions of small businesses. If we can get them out from under this deluge, they can devote themselves to hiring workers, investing capital and moving the economy forward.
Twenty years after the passage of the Paperwork Reduction Act, there is no evidence that the government has reduced the amount of paperwork on small businesses. The Federal Government requires the filing of more than 7,700 forms, resulting in nearly 66 million responses with a total burden of more than 7.5 billion man-hours.
The Office of Management and Budget estimates that the annual cost of these paperwork burdens cost the American economy over $61.7 billion. This is a vast amount of paperwork.
Do we know how much of this burden is imposed on small businesses? Do we know how much of this burden is imposed on particular classes of small businesses? Does the Office of Management and Budget know which forms apply to which businesses? If it does, has that agency considered whether the information is duplicated? This bill, H.R. 327, provides the answers to these questions.
For example, convenience store owners that sell gasoline may have to prepare 46 different Federal forms. That is in addition to the basic forms for starting a business which are numerous, forms related to the sale and service of food, et cetera, et cetera. The forms and their associated instructions for the 46 different forms particularly associated with convenience stores total 250 pages of legal and regulatory prose. I got this information not from the Federal Government, which does not compile
according to the function of the retailer or the wholesaler, but from a trade association.
So if someone wants to start a convenience store that sells gasoline, he or she would have to go to seven different Federal agencies. That assumes that they even knew that they should be going to some of those agencies. The situation is simply intolerable. H.R. 327 corrects this problem.
The bill requires the Office of Management and Budget to classify forms by business category, mandates that OMB put the information on the Internet in a user-friendly manner for small businesses, forces Federal agencies to create a single point of contact for small businesses to obtain information concerning paperwork requirements, and creates an interagency task force to consider ways to reduce and streamline the paperwork burdens now facing small businesses.
As the chairman of the Committee on Small Business, I would like to thank the gentleman from Indiana (Mr. BURTON) and the gentleman from California (Mr. OSE) for moving H.R. 327. I look forward to working with the gentleman from Indiana (Mr. BURTON) and the gentleman from California (Mr. OSE) on improving the Paperwork Reduction Act to ensure that the Federal Government reduces paperwork burdens on America's small businesses.
Mr. MANZULLO. Mr. Chairman, I thank the gentleman from California for clarifying that issue.
I also note that the bill would require the Office of Management and Budget place the information on small business paperwork burdens on the Internet. I agree that this would make the information more accessible.
However, I believe more can be done. I think that OMB should establish a link on its website to the agency point of contact established by the bill. Each agency's website then would have links to the relevant paperwork required for small business. I would like the opinion of the gentleman from California on this point.
Mr. Chairman, I yield to the gentleman from California (Mr. OSE).
Mr. MANZULLO. Mr. Chairman, finally, I would like to clarify one point. The bill as introduced required that the information be organized by the North American Industrial Classification System. The amendment would modify that requirement by leaving it up to the discretion of OMB.
Is it the opinion of the gentleman from California (Mr. OSE) that the best method of classifying the information remains the North American Industrial Classification System because that would enable small businesses to best identify the paperwork burdens associated with the particular businesses?
Mr. Chairman, I yield to the gentleman from California (Mr. OSE).
Mr. TIERNEY. Mr. Chairman. I yield myself such time as I may consume.
Mr. Chairman, I understand the desire that the task force address concerns of the small business community. It is my understanding that is why the task force in fact includes someone from the Small Business Office of Advocacy. That is what they do. So I should not think we would all be surprised about that. I think that should continue and we support that.
But I think it is also important that the task force obtain input from the environmental, public health and the labor communities as well. Because the study, in fact, is looking at the feasibility of streamlining paperwork without negatively impacting underlying protections.
I think, as much as we can all rail here about the need for paperwork reduction and streamlining, we all believe that is a good goal. I think few of us would argue that the regulations in fact are there for a purpose. While we are achieving our goal for this bill, we want to make sure we do not undercut the purposes of those regulations that are so important.
I would also like to clarify a point made by the gentleman from California (Mr. OSE). I understand his preference of the Office of Management and Budget to use the North American Industrial Classification System. However, I want to ensure that he understands the bill has changed. The bill now states that the information should be organized in such a manner that such small business concerns can easily identify requirements by which they are expected to comply.
If the North American Industrial Classification System is the easiest, then I think that is obviously the one OMB will select. But we should all know that the NAIC categories are used for census purposes and for compiling statistics. OMB may not find that to be the most significant or most proper way to do that, in which case they will use another way of presenting the information.
I thank the chairman for that.
Mr. Chairman, I yield 2 minutes to the gentleman from California (Mr. BACA).
(Mr. BACA asked and was given permission to revise and extend his remarks.)
Mr. BACA. Mr. Chairman, I stand in support of this legislation, H.R. 327. If we are not choking small businesses with overburdensome regulations, we are choking them with paperwork.
Today small business owners have to contend with an increased competition with big businesses who are merging and consolidating and putting a squeeze on the little guy. Then they have big government come in, squeezing the little guy with tons of regulations and paperwork. This is why this country is heading into a recession.
Small business is the engine of the economic growth in this country. The biggest employer is the Inland Empire in my area with the largest growth of small businesses.
What we have done is we have stalled the engine. I state we have stalled the engine. We have forced small businessmen and women to spend hours filling out forms. These are hours they cannot [Page: H937]
spend with customers, their families, vendors, civic organizations.
Time is money. As a former small business owner, I know how tough it can be to keep up with small regulations and forms. I wanted to be a good businessman, not a good form-filler-outer.
For those of us who are in small businesses, we understand what is going on in the world around us and the kind of competition that we are faced with as well. We want to be just as competitive as anybody else. But we also want to spend our time wisely. The way to do that is to get rid of some of the burdens that we have in the filling out of the paperwork.
In addition, I am also concerned that the President's budget cuts Small Business Administration almost in half from its level of 2000 and that the President's tax plan does not allow for specific tax relief for small businesses.
Small businesses deserve our support and help. They need financing programs. They deserve specific tax relief measures. They need less burdensome regulations and less paperwork.
Let us unharness small business owners and get the engine going again. I ask for support for H.R. 327.
Mr. PENCE. Mr. Chairman, I thank the gentleman from California for yielding me the time.
Mr. Chairman, I am grateful for this opportunity to come to the floor this morning to urge my colleagues to support the Small Business Paperwork Reduction Act. I specifically thank the gentleman from California (Chairman OSE) and the gentleman from Massachusetts (Mr. TIERNEY) for their efforts in this regard.
My good friends, the gentleman from Indiana (Chairman BURTON) and the gentleman from Illinois (Chairman MANZULLO), have introduced and worked with these gentlemen to introduce an important bill to help the new administration protect small business from an ever-expanding regulatory burden.
As the new chairman of the Subcommittee on Regulatory Reform and Oversight, I am especially pleased to pick up the regulatory reform mantle from the gentlewoman from New York (Mrs. KELLY) and my good friend and predecessor David McIntosh. They did a tremendous job as advocates for small business, and I hope to continue to fight regulatory excess and burdensome paperwork that acts as such an impediment to economic growth and expansion.
In fact, Mr. Chairman, reducing this burden is as important to small businesses as tax relief, because filling out forms competes directly with the business manager's principal goal, growing his or her business. This mountain of paperwork has been the enemy.
In spite of the importance of small business to the success of our economy, small businesses face serious hurdles. One of the hardships that I have heard over and over again in east central Indiana from small business leaders in my district is the burden of paperwork and Federal red tape.
The Office of Management and Budget estimates the Federal paperwork burden at 7.2 billion hours. What does this mean, Mr. Chairman? It means that it takes an army of 3.5 million workers working 40 hours a week, 52 weeks of the year to simply fill out all of the paperwork the Federal Government requires each year. According to the Office of Management and Budget, this costs the American public $190 billion a year.
Much of the information that is gathered in this paperwork is important, sometimes even crucial for the government to function. However, too often the paperwork is duplicative and sometimes unnecessary.
Unfortunately, past efforts to fix the paperwork problem have not worked. In 1995, Congress passed amendments to the Paperwork Reduction Act. The goal of the act was to annually reduce the requirements of the Federal Government. These annual reductions in paperwork, however, have not been achieved. In fact, paperwork burdens have increased over the past 5 years.
As my colleagues know, the regulatory burden that the Federal Government imposes on business is staggering. According to the Small Business Administration, it costs large firms $3,400 per employee to comply with Federal regulations. However, the cost to small businesses is 50 percent greater, a staggering, $5,100 per employee; and for small businesses, nearly $2,000 of this cost is for paperwork alone. H.R. 327 starts to deal with these paperwork issues.
Mr. Chairman, I urge my colleagues to support the Small Business Paperwork Relief Act.
Mr. WAXMAN. Mr. Chairman, I rise to urge my colleagues to support passage of H.R. 327, the Small Business Paperwork Relief Act. As my colleagues may recall, similar legislation was on the House floor during the 105th and the 106th Congresses, which I did not support. H.R. 327, however, does not contain the controversial provisions as in the past years that would have condoned violations of important health and safety laws.
In addition to stripping the bill of the egregious language regarding violations, the majority worked with us to add new provisions that call for agencies to make it easier for small businesses to learn what is expected of them and improve the dissemination of regulatory information to the public. This bill calls on agencies to work together to create a way for a small business person to be able to contact one agency for information instead of multiple agencies as is currently required.
I especially want to highlight one provision which calls on agencies to work toward an interactive computer system which will allow small businesses to electronically identify information collection requirements. A small business person should be able to go online and determine what are the government requirements with which the business needs to comply.
Just this week the General Accounting Office released a report, Regulatory Management: Communication About Technology-Based Innovations Can Be Improved, drafted at my request and the request of Senators LIEBERMAN and THOMPSON. It demonstrates how information technology can and should be used by agencies when they interact with the public to accomplish their missions. The report explains that increased use of information technology in regulatory management has the potential to yield
significant benefits, including reducing burden on regulated entities; and I believe the changes to this bill start us on the right track.
Mr. Chairman, of course this bill's attempt to help small businesses should not obscure what this Congress has done to hurt small businesses. This Republican Congress began down the wrong path earlier this month when it included anti-small business provisions in the bankruptcy bill it passed. One such provision created an inflexible trigger which requires a court to order liquidation even if the small business is still viable.
Similarly, the President's budget recently submitted to Congress funding cuts of the Small Business Administration by 46.4 percent. Specifically, the budget eliminates the New Markets Venture Capital program, which provides venture capital and technical assistance to small businesses in less prosperous areas of the country.
In addition, it eliminates the business link program which encourages mentoring between large and small businesses.
Mr. Chairman, although there were a number of additional provisions that I would have liked to see in this bill, because this bill no longer has the violations sections and because some of the Democratic suggestions were included, I urge passage of H.R. 327. [Page: H938]
In closing, I would like to commend the gentleman from California (Mr. OSE), the subcommittee chairman; the gentleman from Indiana (Mr. BURTON), the full committee chairman; and the gentleman from Massachusetts (Mr. TIERNEY), the subcommittee ranking member. They have worked together to produce a bill that deserves our support.
Ms. JACKSON-LEE of Texas. Mr. Chairman, I thank the gentleman for yielding me this time and for his leadership. I also thank the committee for its leadership and thank the chairman as well.
Mr. Chairman, I wanted to come to the floor to suggest to my colleagues that I wish that we could be doing more. I happen to be a member of the House Committee on Science, and during my tenure on that committee I have often said that small business is the backbone, the infrastructure, of America, along with science. Science is the work of America. In many instances, small businesses are engaged in activities that generate research and improvements in our quality of life.
I believe the backbone of this legislation is the idea of providing access to small businesses as relates to our Federal agencies. So I am certainly supportive of the aspects that would require Federal agencies to reduce paperwork requirements for very small businesses; and certainly I am very supportive of establishing single points of contacts for information on paperwork requirements and the fact that we are publishing each year a list of all paperwork requirements on small businesses and
establishing a task force to study the feasibility of streamlining small business reporting requirements.
But I would like to see us continue outreach activities to small businesses. I think the concept promoted in the last administration of the U.S. General Store, where there was a central point where small businesses could access the Federal agencies and find out how to market products to the Federal agencies and how to work with the Federal agencies, is a concept that this Congress should take up again.
I think this Congress should be looking at how we can lower the cost of health care for our smaller businesses in a manner that provides health care to their employees in an economical way. I think this Congress should be looking at how we can address the energy crisis so that the high cost of fuel is not putting our small businesses out of business. And I would hope that this Congress could as well look at the mobile concerns around the Nation, because it is the employees of small businesses
that most suffer in terms of mobility. In particular, my city of Houston is fighting for a light rail system to assist in our mobility and air-quality issues.
So though I come and support this legislation, inasmuch as I believe the economy is driven by small businesses, I think that we will do well to spend a great deal of our legislative agenda in helping to address the questions that really drive small businesses, which is bringing down their health care costs, providing them with regional mobility, and ensuring that they have the kind of lower costs in energy and overhead costs that will keep them strong and vibrant.
With that, Mr. Chairman, I support the legislation and ask my colleagues to continue their work.
Mr. SCHROCK. Mr. Chairman, America's small business owners collectively spend thousands of hours and billions of dollars each year filling out government paperwork. A friend of mine, Kent Winquist, is a small business owner in Virginia Beach and Norfolk. He tells me that every week he must maintain and update tax forms, Social Security forms, immigration forms, health care forms and many other mandatory Federal forms just to comply with Federal regulations, or face stiff penalties. Small business
owners like Kent are stuck in back offices filling out forms and meeting Federal deadlines instead of training new employees and expanding their businesses. Federal regulatory agencies will continue to hold back small business from thriving in their communities unless we take action.
Mr. Chairman, I believe that less government involvement in our lives will allow us to give more to our communities, our families and our economy. It is time for us to give small businesses back their time so that they [Page: H940]
continue to be the engine that drives our economy. I urge my colleagues to support H.R. 327, the small business paperwork relief act which will give small business owners more time to invest in their businesses and share with their families.
Mr. TOOMEY. Mr. Chairman, I have been a small business owner for about 10 years. Like many of us, I am sure, I know many hundreds of small business owners across my district, the Lehigh valley of Pennsylvania. There is no question that small business is the critical engine of economic growth and the critical creator of jobs. It is also, I would point out, an amazing source of the charitable contributions in our communities, of volunteer work that goes to improve the quality of life in our communities.
It is a thrill to own a small business if you are fortunate enough to have a successful one. There is a great satisfaction in creating a business from scratch and employing people and seeing that become productive. But it is also an enormous challenge. There is a great deal of worry, whether you are going to make that payroll every Friday, whether you are going to have the funds to make that bank payment that is coming due next week, how are you going to figure out how to innovate and stay alive
What we in government ought to be doing is we ought to be finding ways to reduce the obstacles that we impose on the small businesspeople of America who achieve this great success. The two big things we can do is we can relieve the tax burden, the enormous tax burden that small business owners contend with every day. We can support the President's proposal and in fact expand on the President's proposal for tax relief and do wonders for small business. The other thing we can do is reduce the regulatory
burden. H.R. 327 clearly does that. This is a very constructive step to give small business owners the time and energy to be able to spend productively improving their business, creating more jobs and more opportunity. That is what we ought to be doing here.
I urge my colleagues to vote for H.R. 327. I congratulate the members of the committee who have made this possible.