Report: small biz panel manipulated by trade associations

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The government panel that reviews federal rules and how they affect small businesses is manipulated by trade associations, a Nov. 12 Center for Effective Government report says.

Three federal agencies – the Environmental Protection Agency, the Labor Department's Occupational Safety and Health Administration and the Consumer Financial Protection Bureau – are required to convene a small business review panel any time the govenrment plans to issue a rule that could have a significant economic impact on small businesses.

But the report (pdf) says trade associations have too much power over the panel. Trade associations are supposed to identify small business representatives to advise the panel, participate in meetings and even help write their comments, the report says.

But the panel lacks a formal procedure to verify the representatives recommended by the trade associations are eligible, the report says.

"Many individuals nominated by trade associations to be small business advisors to the panels were representatives, board members, lawyers or consultants for trade associations and did not own or operate a small entity likely to be affected by the rule under development," the report says.

On numerous occasions, the report says, the representatives advising the review panel recommended rule changes that went beyond the small business impacts that the panels were convened to review.

For more:
- download the Center For Effective Government report (.pdf)

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