FEDA Co-Signs Letter Urging Congress to Advance Bill to Lessen Regulatory Burden on Small Businesses

FEDA has joined a group of trade associations in urging the House of Representatives to pass the Prove It Act of 2025, a law that would ease federal regulations affecting small businesses.

The act introduces several key provisions intended to enhance transparency in federal regulatory decisions, including:

• Requiring agencies to consider and disclose any reasonably foreseeable indirect costs that proposed rules may impose on small entities.
• Mandating that agencies complete certifications within 10 days and allow small businesses to petition the Small Business Administration’s chief counsel for advocacy if they believe a proposed rule will significantly impact them economically. The chief counsel would then be tasked with determining the merits of those petitions and conducting full reviews if necessary.
• Requiring agencies to publish guidance documents for rules likely to significantly impact small businesses and allowing for public comments on these documents.

In a letter to House Majority Leader Rep. Steve Scalise (R-LA), the business groups note that in 1980 President Jimmy Carter and Congress recognized the disproportionate impact federal regulations have on small businesses, leading to the passage of the Regulatory Flexibility Act (RFA). This law sought to minimize the regulatory burdens on small businesses. However, as the letter states, many agencies have found ways to disregard or avoid many of the requirements in the 45 years since the act was implemented. In 2024, the House Small Business Committee conducted a staff report examining agency compliance with the RFA, finding that most agencies are failing to properly comply with the RFA’s requirements and live up to the spirit of the law. 

The Prove It Act aims to reduce agency noncompliance and reinforce the intent of the RFA. “On behalf of millions of small businesses, thank you for your attention to the disproportionate impact of regulations on small businesses,” the letter states. “We urge the House of Representatives to swiftly provide long-term regulatory relief for small businesses through legislation like H.R. 1163, the Prove It Act of 2025. We look forward to working with you this Congress to continue to reduce compliance burdens and red tape for small businesses.”

The full letter can be read here.