SBA Office of Advocacy: Overview, History,
and Current Issues

Robert Jay Dilger
Senior Specialist in American National Government
February 9, 2015
Congressional Research Service
7-5700
www.crs.gov
R43625


SBA Office of Advocacy: Overview, History, and Current Issues

Summary
The Office of Advocacy is an “independent” office within the U.S. Small Business
Administration (SBA) that advances “the views and concerns of small businesses before
Congress, the White House, federal agencies, the federal courts, and state and local policymakers
as appropriate.” The Chief Counsel for Advocacy (hereinafter Chief Counsel) directs the office
and is appointed by the President from civilian life with the advice and consent of the Senate.
The Office of Advocacy currently has 48 staff members and received an appropriation of $9.12
million for FY2015. It reports that its three primary functions are to (1) intervene early in federal
agencies’ regulatory development process on proposals that affect small businesses and provide
Regulatory Flexibility Act (RFA) compliance training to federal regulatory officials; (2) produce
and promote research to inform policy makers and other stakeholders concerning the impact of
federal regulatory burdens on small businesses, document the role of small businesses in the
economy, and explore and explain the variety of issues of concern to small businesses; and (3)
enhance communication between federal agencies and small businesses.
This report examines the Office of Advocacy’s origins and the expansion of its responsibilities
over time; describes its organizational structure, funding, functions, and current activities; and
discusses recent legislative efforts to further enhance its authority. For example, during the 114th
Congress, H.R. 527, the Small Business Regulatory Flexibility Improvements Act of 2015, was
passed by the House on February 5, 2015. The bill would expand the Office of Advocacy’s
responsibilities by revising and enhancing requirements for federal agency notification of the
Chief Counsel prior to the publication of any proposed rule; expanding the required use of small
business advocacy review panels from three federal agencies to all federal agencies, including
independent regulatory agencies; empowering the Chief Counsel to issue rules governing federal
agency compliance with the RFA; specifically authorizing the Chief Counsel to file comments on
any notice of proposed rulemaking, not just when the RFA is concerned; and transferring size
standard determinations for purposes other than the Small Business Act and the Small Business
Investment Act of 1958 from the SBA’s Administrator to the Chief Counsel.
The SBA’s Office of Advocacy is a relatively small office with a relatively large mandate—to
represent the interests of small business in the regulatory process, produce and promote small
business economic research, and facilitate small business outreach across the federal government.
It faces several challenges.
• The Office of Advocacy is generally recognized as being an independent office,
but it is housed within the much larger SBA which, given their statutorily
overlapping missions as advocates for small businesses, makes it more difficult
than would otherwise be the case for the Office of Advocacy to be recognized by
stakeholders as the definitive voice for small businesses.
• Chief Counsels tend to have relatively short tenures creating continuity problems
for the Office of Advocacy. For example, the position is currently occupied by an
Acting Chief Counsel.
• The RFA does not define significant economic impact or substantial number of
small entities, two key terms for triggering the Office of Advocacy’s role under
the RFA. The lack of clarity concerning these key terms makes it difficult for the
Office of Advocacy to objectively determine agency compliance with the RFA
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SBA Office of Advocacy: Overview, History, and Current Issues

and to train federal regulatory officials in how to come into compliance with the
act.
• The Office of Advocacy often finds itself involved in ideological and partisan
disputes concerning the outcome of federal regulatory policies for which it does
not have the final say.
• The Office of Advocacy’s ability to produce and promote economic research on
small businesses and to engage in outreach activities, particularly outreach
activities not directly related to its RFA role, is constrained by its relatively
limited budgetary resources.


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SBA Office of Advocacy: Overview, History, and Current Issues

Contents
Introduction ...................................................................................................................................... 1
Office of Advocacy’s Origins .......................................................................................................... 2
Office of Chief Counsel for Advocacy ...................................................................................... 2
An “Independent” Office of Advocacy...................................................................................... 3
Advocacy’s Regulatory Oversight Role Expanded ................................................................... 5
Advocacy’s Independent Status Enhanced ................................................................................ 6
Current Organizational Structure and Funding ................................................................................ 7
The Office of Advocacy and Federal Regulations ........................................................................... 8
The RFA .................................................................................................................................... 8
Executive Order 13272 .............................................................................................................. 9
Advocacy’s Regulatory Activities, FY2014 ............................................................................ 10
Producing and Promoting Research on Small Businesses ............................................................. 11
Advocacy’s Research Activities, FY2014 ............................................................................... 13
Promoting Small Business Outreach ............................................................................................. 13
Advocacy’s Outreach Activities, FY2014 ............................................................................... 14
Current Congressional Issues ......................................................................................................... 14
Arguments for Expanding Advocacy’s Authority .................................................................... 14
Arguments Against Expanding Advocacy’s Authority ............................................................ 15
Concluding Observations ............................................................................................................... 16

Figures
Figure 1. SBA Office of Advocacy Organizational Chart................................................................ 7

Contacts
Author Contact Information........................................................................................................... 17

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SBA Office of Advocacy: Overview, History, and Current Issues

Introduction
The Office of Advocacy is an “independent” office within the U.S. Small Business
Administration (SBA) that is responsible for advancing “the views and concerns of small
businesses before Congress, the White House, federal agencies, the federal courts, and state and
local policymakers as appropriate.”1 The Chief Counsel for Advocacy (hereinafter Chief Counsel)
directs the office and is appointed by the President from civilian life with the advice and consent
of the Senate. The Chief Counsel and the Office of Advocacy promote the interests of American
small businesses by
• “intervening early in federal agencies’ regulatory development process on
proposals that affect small businesses and providing Regulatory Flexibility Act
compliance training to federal agency policy makers and regulatory development
officials;
• producing research to inform policy makers and other stakeholders on the impact
of federal regulatory burdens on small businesses, to document the vital role of
small businesses in the economy, and to explore and explain the wide variety of
issues of concern to the small business community; and
• fostering a two-way communication between federal agencies and the small
business community.”2
The Office of Advocacy reports that it currently has 48 full-time staff members.3 It received an
appropriation of $9.12 million for FY2015 and plans to increase its staff to 49 full-time
equivalent positions in FY2016.4
The Office of Advocacy’s responsibilities have expanded over time, and legislation has been
introduced in recent Congresses to increase its authority still further. For example, during the
114th Congress, H.R. 527, the Small Business Regulatory Flexibility Improvements Act of 2015,
was passed by the House on February 5, 2015, by a vote of 260-163. The bill would, among other
provisions
• revise and enhance requirements for federal agency notification of the Chief
Counsel prior to the publication of any proposed rule;

1 U.S. Small Business Administration (SBA), “Office of Advocacy: About Us,” at http://www.sba.gov/category/
advocacy-navigation-structure/about-us; and SBA, Office of Advocacy, Fiscal Year 2016 Congressional Budget
Justification and Fiscal Year 2014 Annual Performance Report
, p. 2, at https://www.sba.gov/sites/default/files/3-
Office%20of%20Advocacy%20FY%202016%20CBJ%20and%20FY%202014%20APR.PDF.
2 SBA, Office of Advocacy, Fiscal Year 2016 Congressional Budget Justification and Fiscal Year 2014 Annual
Performance Report
, p. 2, at https://www.sba.gov/sites/default/files/3-
Office%20of%20Advocacy%20FY%202016%20CBJ%20and%20FY%202014%20APR.PDF.
3 SBA, Office of Advocacy, “Office of Advocacy Staff,” at https://www.sba.gov/advocacy/office-advocacy-staff.
4 SBA, Office of Advocacy, Fiscal Year 2016 Congressional Budget Justification and Fiscal Year 2014 Annual
Performance Report
, p. 3, at https://www.sba.gov/sites/default/files/3-
Office%20of%20Advocacy%20FY%202016%20CBJ%20and%20FY%202014%20APR.PDF.
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• expand the required use of small business advocacy review panels from three
federal agencies to all federal agencies, including independent regulatory
agencies;
• empower the Chief Counsel to issue rules governing federal agency compliance
with the RFA;
• specifically authorize the Chief Counsel to file comments on any notice of
proposed rulemaking, not just when the RFA is concerned; and
• transfer size standard determinations for purposes other than the Small Business
Act and the Small Business Investment Act of 1958 from the SBA’s
Administrator to the Chief Counsel.5
During the 113th Congress, these provisions were included in H.R. 2542, the Regulatory
Flexibility Improvements Act of 2013, and were later included in H.R. 2804, the Achieving Less
Excess in Regulation and Requiring Transparency Act of 2014 (ALERRT Act of 2014), which
was passed by the House on February 27, 2014, and in H.R. 4, the Jobs for America Act (of
2014), which was passed by the House on September 18, 2014.
This report examines the Office of Advocacy’s origins and the expansion of its responsibilities
over time; describes its organizational structure, funding, functions, and current activities; and
discusses recent legislative efforts to further enhance its authority.
Office of Advocacy’s Origins
The Small Business Act of 1953 (P.L. 83-163, as amended) authorized the SBA and directed the
agency to “aid, counsel, assist, and protect, insofar as is possible, the interests of small-business
concerns.” The SBA provided this advocacy function primarily through its administration of
small business loan guaranty programs, contracting assistance programs, and management and
training programs. The SBA Administrator serves as the lead advocate for small businesses within
the federal government.
Office of Chief Counsel for Advocacy
During the early 1970s, several small business organizations indicated at congressional hearings
that they were not wholly satisfied with the SBA’s advocacy efforts, especially in achieving
regulatory relief for small businesses. Congress responded to these concerns by approving
legislation (P.L. 93-386, the Small Business Amendments of 1974) authorizing the SBA
Administrator to create an Office of Chief Counsel for Advocacy and to appoint a Chief Counsel
for Advocacy. The Chief Counsel was to serve as a focal point for the agency’s advocacy efforts.6

5 The size standard provision was in H.R. 585, the Small Business Size Standard Flexibility Act of 2011, which was
introduced during the 112th Congress. The other provisions were in H.R. 527, the Regulatory Flexibility Improvements
Act of 2011, which was introduced during the 112th Congress and passed by the House on December 1, 2011. For
additional information concerning H.R. 2542 see H.Rept. 113-288, the Regulatory Flexibility Improvements Act of
2013, Part 1. For additional information concerning the SBA’s size standards see CRS Report R40860, Small Business
Size Standards: A Historical Analysis of Contemporary Issues
, by Robert Jay Dilger.
6 U.S. Congress, House Select Committee on Small Business, Small Business Amendment of 1974, report to accompany
(continued...)
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P.L. 93-386 provided the Chief Counsel five duties:
1. serve as a focal point for the receipt of complaints, criticisms, and suggestions
concerning the policies and activities of the Administration and any other federal
agency that affects small businesses;
2. counsel small businesses on how to resolve questions and problems concerning
the relationship of the small business to the federal government;
3. develop proposals for changes in the policies and activities of any agency of the
federal government that will better fulfill the purposes of the Small Business Act
and communicate such proposals to the appropriate federal agencies;
4. represent the views and interests of small businesses before other federal
agencies whose policies and activities may affect small businesses; and
5. enlist the cooperation and assistance of public and private agencies, businesses,
and other organizations in disseminating information about the programs and
services provided by the federal government, which are of benefit to small
businesses, and information on how small businesses can participate in or make
use of such programs and services.7
The SBA created the Office of Chief Counsel for Advocacy in October 1974, and designated each
of the SBA’s regional, district, and branch office directors as the advocacy director for their area.8
The Office of Chief Counsel was placed under the Office of Advocacy, Planning and Research,
which was headed by an Assistant Administrator.9 Anthony Stasio, a long-time, career manager
within the SBA, was named the first Chief Counsel. Three deputy advocate positions were
subsequently created and staffed: Deputy Advocate for Advisory Councils, Deputy Advocate for
Government Relations, and Deputy Advocate for Small Business Organizations. The SBA’s
Office of Chief Counsel for Advocacy was fully operational as of March 1, 1975.10
An “Independent” Office of Advocacy
As the Office of Advocacy began operations, several small business organizations lobbied
Congress to provide the Chief Counsel greater independence from the SBA’s Administrator. They
argued that the SBA’s Administrator reports to the White House and is subject to the influence
and direction of the Director of the Office of Management and Budget (OMB). In their view,

(...continued)
H.R. 15578, 93rd Cong., 2nd sess., July 3, 1974, H.Rept. 93-1178 (Washington: GPO, 1974), p. 8.
7 P.L. 93-386, the Small Business Amendments of 1974.
8 U.S. Congress, Senate Select Committee on Small Business, Problems Confronting Small Business, hearing on
problems confronting small business, 94th Cong., 1st sess., February 24, 1975 (Washington: GPO, 1975), p. 22.
9 U.S. Congress, Senate Select Committee on Small Business, Oversight of the Small Business Administration: The
Office of the Chief Counsel for Advocacy and How It Can Be Strengthened,
hearing on the Office of the Chief Counsel
for Advocacy, 94th Cong., 2nd sess., March 29, 1976 (Washington: GPO, 1976), pp. 77-78.
10 U.S. Congress, Senate Select Committee on Small Business, Problems Confronting Small Business, hearing on
problems confronting small business, 94th Cong., 1st sess., February 24, 1975 (Washington: GPO, 1975), p. 22; and
U.S. Congress, Senate Select Committee on Small Business, Oversight of the Small Business Administration: The
Office of the Chief Counsel for Advocacy and How It Can Be Strengthened,
hearing on the Office of the Chief Counsel
for Advocacy, 94th Cong., 2nd sess., March 29, 1976 (Washington: GPO, 1976), p. 2.
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OMB, at that time, was more attuned to promoting the interests of large businesses than it was to
promoting the interests of small businesses.11
Congress responded to these concerns by passing P.L. 94-305, to amend the Small Business Act
and Small Business Investment Act of 1958. Enacted on June 4, 1976, Title II of the act enhanced
the Chief Counsel’s authority by requiring the Office of Advocacy to be established as a separate,
stand-alone office within the SBA and by requiring the Chief Counsel to be appointed from
civilian life by the President, by and with the advice and consent of the Senate.12
P.L. 94-305 also
• retained the Office of Advocacy’s five duties as identified in P.L. 93-386;
• specified that one of the Office of Advocacy’s primary functions was to examine
the role of small business in the American economy and the problems faced by
small businesses and to recommend specific measures to address those problems;
• empowered the Chief Counsel, after consultation with and subject to the approval
of the SBA Administrator, to employ and fix the compensation of necessary staff,
without going through the normal competitive procedures directed by federal law
and the Office of Personnel Management;13
• specified that the Chief Counsel could obtain expert advice and other services,
and hold hearings;
• directed each federal department, agency and instrumentality to furnish the Chief
Counsel with reports and information deemed by the Chief Counsel as necessary
to carry out his or her functions;
• ordered the Chief Counsel to provide Congress, the President, and the SBA with
information concerning his or her activities; and
• authorized to be appropriated $1 million for the Office of Advocacy, with any
appropriated funds remaining available until expended.14
It was at this time that the word independent began to be used to describe the Chief Counsel and
the Office of Advocacy. However, the Office of Advocacy remained a part of the SBA and subject
to the sitting Administration’s influence. For example, at that time, the Office of Advocacy’s
budget was provided through the SBA’s salaries and expenses account, which was approved by

11 U.S. Congress, Senate Select Committee on Small Business, Oversight of the Small Business Administration: The
Office of the Chief Counsel for Advocacy and How It Can Be Strengthened
, hearing on the Oversight of the Chief
Counsel for Advocacy, 94th Cong., 2nd sess., March 29, 1976, (Washington: GPO, 1976), pp. 83, 94, 104, 109-111.
12 President Gerald Ford did not nominate a Chief Counsel for Advocacy. Mr. Stasio was named Acting Assistant
Administrator for Advocacy and Public Communication, and continued to administer the Office of Advocacy until
Milton D. Stewart was confirmed as Chief Counsel in 1978. Milton D. Stewart (1978-1981) became the first of six
Chief Counsels, to date, to be nominated by the President (on March 2, 1978) and confirmed by the Senate (on July 18,
1978). He was succeeded as Chief Counsel by Frank S. Swain (1981-1989), Thomas Kerester (1992-1993), Jere W.
Glover (1994-2001), Thomas M. Sullivan (2002-2008), and Winslow Sargeant (2011-present).
13 U.S. Congress, Senate Committee on Small Business and Entrepreneurship, Independent Office of Advocacy Act of
2001
, 107th Cong., 1st sess., March 21, 2001, S.Rept. 107-5 (Washington: GPO, 2001), p. 2.
14 U.S. Congress, Senate Select Committee on Small Business, Subcommittee on Government Regulation and Small
Business Advocacy, The Study of Small Business, hearing on The Study of Small Business, 95th Cong., 1st sess., June
29, 1977 (Washington: GPO, 1977), pp. 12-13.
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the SBA Administrator; the Office of Advocacy’s annual staffing allotment was subject to the
SBA Administrator’s approval; and some senior staff within the Office of Advocacy were vetted
by the White House personnel office prior to hiring.15
Advocacy’s Regulatory Oversight Role Expanded
The Office of Advocacy’s duties were further expanded following enactment of P.L. 96-354, the
Regulatory Flexibility Act of 1980 (RFA, as amended).16 The RFA
establishes in law the principle that government agencies must analyze the effects of their
regulatory actions on small entities−small businesses, small nonprofits, and small
governments−and considers alternatives that would be effective in achieving their regulatory
objectives without unduly burdening these small entities. Advocacy has the responsibility of
overseeing and facilitating federal agency compliance.17
The RFA’s sponsors argued that federal agencies should be required to examine the impact of
regulations on small businesses because federal regulations tend to be “uniform in design, permit
little discretion in their implementation, and place a disproportionate burden upon small
businesses, small organizations and small governmental bodies.”18 As Alfred Dougherty, Jr.,
director of the Federal Trade Commission’s Bureau of Competition, testified at a congressional
hearing:
First, even if actual regulatory costs are equal between competing large and small firms,
small firms have fewer units of output over which to spread such costs and must include in
the price of each unit a larger component of regulatory cost. Second, where small firms have
smaller actual regulatory costs than large firms (as is generally the case), small firms remain
at a competitive disadvantage because they are unable to take advantage of the “economies
of scale” of regulatory compliance. Large firms generally already have extensive “in-house”
data compilation and reporting systems and specialized staff accountants, lawyers and
managers whose primary function is regulatory compliance. Small firms, by comparison,
must either hire additional personnel or purchase expensive consulting services in order to
acquire the necessary regulatory expertise.19
Economist Milton Kafoglis, a member of the President Jimmy Carter’s Council on Wage and
Price Stability, testified that
There seem to be clear economies of scale imposed by most regulatory endeavors. Uniform
application of regulatory requirements thus seems to increase the size [of the] firm that can

15 P.L. 94-305; and U.S. Congress, Senate Committee on Small Business and Entrepreneurship, Independent Office of
Advocacy Act of 2001
, 107th Cong., 1st sess., March 21, 2001, S.Rept. 107-5 (Washington: GPO, 2001), pp. 2-4.
16 5 U.S.C. §601 et seq. Also see P.L. 104-121, the Small Business Regulatory Enforcement Fairness Act of 1996
(SBREFA); P.L. 111-203, the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010; P.L. 111-240,
the Small Business Jobs Act of 2010; and Executive Order 13272. For further information concerning the RFA, see
CRS Report RL34355, The Regulatory Flexibility Act: Implementation Issues and Proposed Reforms, coordinated by
Maeve P. Carey.
17 SBA, Office of Advocacy, Report on the Regulatory Flexibility Act FY2013, p. 1, at http://www.sba.gov/sites/
default/files/13regflx.pdf.
18 U.S. Congress, Senate Committee on the Judiciary, The Regulatory Flexibility Act, report to accompany S. 299, 96th
Cong., 2nd sess., July 30, 1980, S.Rept. 96-878 (Washington: GPO, 1980), p. 3.
19 Ibid., p. 4.
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effectively compete. The cost curve of the firm is shifted upward …[with] the small firms’
cost curve shifting more than that of the dominant firms [thus] the share of the dominant firm
will increase while that of small firms will decrease. As a result, industrial concentration will
have increased. This … suggests that the “small business” [regulatory] problem goes beyond
mere sympathy for the small businessman, but strikes at the heart of the established national
policy of maintaining competition and mitigating monopoly.20
As discussed below, the RFA requires federal agencies to assess the impact of their forthcoming
regulations on small entities, which the act defines as small businesses, small governmental
jurisdictions, and certain small not-for-profit organizations.21 The Chief Counsel is responsible for
monitoring and reporting agencies’ compliance with the act’s provisions. The Chief Counsel also
reviews and comments on proposed regulations and may appear as amicus curiae (i.e., friend of
the court) in any court action to review a rule.
Advocacy’s Independent Status Enhanced
P.L. 111-240, the Small Business Jobs Act of 2010, further enhanced the independence of the
Office of Advocacy by ending the practice of including the Office of Advocacy’s budget in the
SBA’s Salaries and Expenses’ Executive Direction account. Instead, the President is required to
provide a separate statement of the amount of appropriations requested for the Office of
Advocacy, “which shall be designated in a separate account in the General Fund of the Treasury.”
The Small Business Jobs Act also requires the SBA Administrator to provide the Office of
Advocacy with “appropriate and adequate office space at central and field office locations,
together with such equipment, operating budget, and communications facilities and services as
may be necessary, and shall provide necessary maintenance services for such offices and the
equipment and facilities located in such offices.”
In recognition of its enhanced independence and separate appropriations account, the Office of
Advocacy, for the first time, issued its own congressional budget justification document and
annual performance report as part of the Obama Administration’s FY2013 budget request. That
document was presented in a new appendix accompanying the SBA’s congressional budget
justification document and annual performance report. The Office of Advocacy has continued to

20 Ibid., pp. 3-4. Also see U.S. Congress, Senate Committee on the Judiciary, The Regulatory Flexibility Act, report to
accompany S. 1974, 95th Cong., 2nd sess., October 11, 1978, S.Rept. 95-1322 (Washington: GPO, 1978), pp. 3-10.
21 The RFA specifies that …(3) the term small business has the same meaning as the term small business concern under
Section 3 of the Small Business Act, unless an agency, after consultation with the Office of Advocacy of the Small
Business Administration and after opportunity for public comment, establishes one or more definitions of such term,
which are appropriate to the activities of the agency and publishes such definition(s) in the Federal Register; (4) the
term small organization means any not-for-profit enterprise, which is independently owned and operated and is not
dominant in its field, unless an agency establishes, after opportunity for public comment, one or more definitions of
such term, which are appropriate to the activities of the agency and publishes such definition(s) in the Federal Register;
(5) the term small governmental jurisdiction means governments of cities, counties, towns, townships, villages, school
districts, or special districts, with a population of less than fifty thousand, unless an agency establishes, after
opportunity for public comment, one or more definitions of such term which are appropriate to the activities of the
agency and which are based on such factors as location in rural or sparsely populated areas or limited revenues due to
the population of such jurisdiction, and publishes such definition(s) in the Federal Register; (6) the term small entity
shall have the same meaning as the terms small business, small organization and small governmental jurisdiction
defined in paragraphs (3), (4), and (5) of this section. See 5 U.S.C. §601 (3)-(6).
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issue its own budget justification document in each of the Administration’s subsequent budget
requests.22
Current Organizational Structure and Funding
As mentioned previously, the Office of Advocacy currently has a full-time staff of 48, which
includes 3 employees, including the Chief Counsel, in the Office of the Chief Counsel; 14 in the
Office of Interagency Affairs (regulatory staff); 7 in the Office of Economic Research; 7 in the
Office of Information; 11 in the Office of Regional Affairs (regional advocates); and 6 in the
Administrative Support Branch (see Figure 1).
Figure 1. SBA Office of Advocacy Organizational Chart

Source: U.S. Small Business Administration, Office of Advocacy, “Fiscal Year 2016 Congressional Budget
Justification and Fiscal Year 2014 Annual Performance Report,” p. 18, at https://www.sba.gov/sites/default/files/3-
Office%20of%20Advocacy%20FY%202016%20CBJ%20and%20FY%202014%20APR.PDF.
The agency received an appropriation of $9.12 million in FY2015. Staff salaries and benefits
account for about 89% of the Office of Advocacy’s budget, with the remainder used for economic
research grants and direct expenses, such as subscriptions, travel, training, and office supplies.23

22 The Office of Advocacy’s congressional budget documents can be accessed on the SBA’s website at
http://www.sba.gov/about-sba/sba_performance/performance_budget/congressional_budget_justification/
annual_performance_reports.
23 SBA, Office of Advocacy, Fiscal Year 2016 Congressional Budget Justification and Fiscal Year 2014 Annual
Performance Report
, p. 3, at https://www.sba.gov/sites/default/files/3-
Office%20of%20Advocacy%20FY%202016%20CBJ%20and%20FY%202014%20APR.PDF.
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The Office of Advocacy and Federal Regulations
The Office of Advocacy is responsible for monitoring and reporting on federal agency
compliance with the RFA (5 U.S.C. §§601-612) and Executive Order 13272, Proper
Consideration of Small Entities in Agency Rulemaking (August 13, 2002). The Office of
Advocacy also comments on proposed rules and participates in small business advocacy review
panels, among other activities.
The RFA
As mentioned previously, the RFA (as amended) requires federal agencies to assess the impact of
their forthcoming regulations on small entities, which the act defines as including small
businesses, small governmental jurisdictions, and certain small not-for-profit organizations.
According to the Office of Advocacy, the RFA
does not seek preferential treatment for small entities, require agencies to adopt regulations
that impose the least burden on small entities, or mandate exemptions for small entities.
Rather, it requires agencies to examine public policy issues using an analytical process that
identifies, among other things, barriers to small business competitiveness and seeks a level
playing field for small entities, not an unfair advantage.24
Under the RFA, Cabinet departments and independent agencies as well as independent regulatory
agencies must prepare a regulatory flexibility analysis at the time certain proposed and final rules
are issued.25 The analysis must describe, among other things, (1) the reasons why the regulatory
action is being considered; (2) the small entities to which the proposed rule will apply and, where
feasible, an estimate of their number; (3) the projected reporting, recordkeeping, and other
compliance requirements of the proposed rule; and (4) any significant alternatives to the rule that
would accomplish the statutory objectives while minimizing the impact on small entities.26
However, these analytical requirements are not triggered if the head of the issuing agency
certifies that the proposed rule would not have a “significant economic impact on a substantial
number of small entities.” The RFA does not define significant economic impact or substantial
number of small entities. As a result, federal agencies have substantial discretion regarding when
the act’s analytical requirements are initiated. In addition, the RFA’s analytical requirements do
not apply to final rules for which the agency does not publish a proposed rule.27
The RFA also requires federal agencies to
• publish a “regulatory flexibility agenda” each April and October in the Federal
Register, listing regulations that the agency expects to propose or promulgate

24 SBA, Office of Advocacy, “A Guide for Government Agencies: How to Comply with the Regulatory Flexibility
Act,” May 2012, p. 1, at http://www.sba.gov/sites/default/files/rfaguide_0512_0.pdf.
25 The analysis for a proposed rule is referred to as an initial regulatory flexibility analysis (IRFA) and the analysis for
a final rule is referred to as a final regulatory flexibility analysis (FRFA).
26 See CRS Report RL34355, The Regulatory Flexibility Act: Implementation Issues and Proposed Reforms,
coordinated by Maeve P. Carey.
27 Ibid.
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which are likely to have a significant economic impact on a substantial number
of small entities;
• provide their regulatory flexibility agenda to the Chief Counsel and to small
businesses or their representatives;
• retrospectively review rules that have or will have a significant impact within 10
years of their promulgation to determine whether they should be continued
without change or should be amended or rescinded to minimize their impact on
small entities; and
• ensure that small entities have an opportunity to participate in the rulemaking
process.28
In addition, the Environmental Protection Agency (EPA), Occupational Safety and Health
Administration (OSHA), and the Consumer Financial Protection Bureau (CFPB) are required to
convene a small business advocacy review panel (sometimes referred to as SBREFA panels)29
whenever they are developing a rule that is anticipated to have a significant economic impact on a
substantial number of small entities. These panels consist of a representative or representatives
from the rulemaking agency, OMB’s Office of Information and Regulatory Affairs (OIRA), and
the Chief Counsel. Information and advice from small entity representatives are solicited to assist
the panel in understanding the ramifications of the proposed rule. The panel must be convened
and complete its report, with recommendations, within a 60-day period.30 Finally, the RFA
encourages the issuing agency to modify the proposed rule or initial regulatory flexibility analysis
as appropriate, based on the information received from the panel.
The RFA also requires the Chief Counsel to monitor and report at least annually on agencies’
compliance with the act. The Chief Counsel accomplishes this primarily by reviewing and
commenting on proposed regulations and by participating in small business advocacy review
panels. In addition, the Chief Counsel may appear as amicus curiae (i.e., friend of the court) in
any court action to review a rule.
Executive Order 13272
Executive Order 13272, Proper Consideration of Small Entities in Agency Rulemaking (August
13, 2002), requires federal agencies to make information publicly available concerning how they
will comply with the RFA’s statutory mandates.31 It also requires federal agencies to send to the

28 SBA, Office of Advocacy, “Report on the Regulatory Flexibility Act, FY2014,” January 2015, pp. 19-21, at
https://www.sba.gov/sites/default/files/advocacy/FY2014%20RFA%20Report.pdf.
29 Small business advocacy review panels were created by P.L. 104-121, the Contract with America Advancement Act
of 1996; Title III, the Small Business Regulatory Enforcement Fairness Act of 1996 (SBREFA). That act requires the
Environmental Protection Agency and Occupational Safety and Health Administration to convene small business
advocacy review panels. P.L. 111-203, the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010,
added the Consumer Financial Protection Bureau.
30 The agency proposing the rule normally fixes the convening date after consulting with the Office of Advocacy and
OMB’s Office of Information and Regulatory Affairs. The three agencies typically work together before convening to
discuss regulatory alternatives. See SBA, Office of Advocacy, “A Guide for Government Agencies: How to Comply
with the Regulatory Flexibility Act,” May 2012, p. 52, at http://www.sba.gov/sites/default/files/rfaguide_0512_0.pdf.
31 Executive Order 13272, “Proper Consideration of Small Entities in Agency Rulemaking,” 67 Federal Register
53461-53462, August 13, 2002.
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Office of Advocacy copies of any draft regulations that may have an impact on a substantial
number of small entities. Agencies must send these draft regulations to the Office of Advocacy at
the same time the draft rules are sent to OIRA for review, or at a reasonable time prior to their
publication in the Federal Register. Agencies must consider the Office of Advocacy’s comments
on the proposed rule and must address these comments in the final rule published in the Federal
Register
.32
Executive Order 13272 requires the Office of Advocacy to
• notify federal agencies concerning how to comply with the RFA, which is
accomplished primarily through the Office of Advocacy’s periodic publication of
“A Guide for Government Agencies: How to Comply with the Regulatory
Flexibility Act” and through the Office of Advocacy’s compliance training
program;
• report annually on federal agency compliance with the executive order; which is
accomplished primarily through the Office of Advocacy’s annual publication of
“Report on the Regulatory Flexibility Act”; and
• train federal regulatory agencies in how to comply with the RFA, which is
accomplished through the Office of Advocacy’s compliance training program.33
Advocacy’s Regulatory Activities, FY2014
In FY2014, the Office of Advocacy provided 22 official public comment letters to 9 different
federal agencies on a variety of proposed rules. The two most frequently cited concerns were that
the agency’s analysis of the proposed rule’s impact on small entities was inadequate (eight
instances) and significant alternatives were not considered (six instances).34
The Office of Advocacy also hosted 19 roundtable discussions in FY2014, providing stakeholders
an opportunity to share their views concerning the impact of proposed rules.35 It also provided
training on RFA compliance at 16 federal agencies through its compliance training program. The
number of federal officials participating in this training in FY2014 is expected to be available
later this year.36 In FY2014, the Office of Advocacy provided RFA training to 132 federal officials
at rule-writing agencies.37
Each year, the Office of Advocacy provides an estimate of the regulatory cost savings its
activities provide to small businesses in the form “of foregone capital or annual compliance costs
that otherwise would have been required in the first year of a rule’s implementation.”38 These

32 SBA, Office of Advocacy, “Report on the Regulatory Flexibility Act, FY2014,” January 2015, p. 16, at
https://www.sba.gov/sites/default/files/advocacy/FY2014%20RFA%20Report.pdf.
33 Ibid.
34 Ibid., p. 25.
35 Ibid., p. 21.
36 Ibid., p. 3.
37 SBA, Office of Advocacy, Fiscal Year 2016 Congressional Budget Justification and Fiscal Year 2014 Annual
Performance Report
, p. 15, at https://www.sba.gov/sites/default/files/3-
Office%20of%20Advocacy%20FY%202016%20CBJ%20and%20FY%202014%20APR.PDF.
38 SBA, Office of Advocacy, “Report on the Regulatory Flexibility Act, FY2013,” February 2014, p. 33, at
(continued...)
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estimates are based primarily on estimates from the federal agencies promulgating the rules, and,
in some instances, from industry estimates.
Estimating the costs and benefits of federal regulations is methodologically challenging.39 For
example, researchers must determine the baseline for measurement (i.e., what effects would have
occurred in the absence of the regulation) and many regulatory cost estimates are based on
aggregating the results of regulatory studies conducted years earlier. These studies often use
different methods and vary in quality, making conclusions drawn from them problematic. Some
observers, including OMB, doubt whether an accurate measure of total regulatory costs and
benefits is possible. Moreover, in the case of the Office of Advocacy, estimating regulatory cost
savings from its activities is even more challenging because it is nearly impossible to determine
what changes to these regulations would have been made during the review and comment period
if the Office of Advocacy did not exist.
The Office of Advocacy reported that its intervention in eight rules that were made final in
FY2014 resulted in “regulatory cost savings of more than $4.8 billion on behalf of small
businesses.”40 The Office of Advocacy also indicated that its intervention in five other rules that
were made final in FY2014 may have resulted in additional regulatory cost savings “but the
monetary effects of these changes are indeterminate.”41
Producing and Promoting Research on Small
Businesses

The Office of Advocacy’s Office of Economic Research “assembles and uses data and other
information from many different sources to develop data products that are as timely and
actionable as possible.”42 These products typically relate “to the role that small businesses play in
the Nation’s economy, including the availability of credit, the effects of regulations and taxation,
the role of firms owned by women, minority and veteran entrepreneurs, factors that influence
entrepreneurship, innovation and other issues of concern to small businesses.”43
In addition to sponsoring and conducting research on small business, the Office of Advocacy
maintains web pages with links to

(...continued)
http://www.sba.gov/sites/default/files/13regflx.pdf.
39 For further information and analysis concerning the methodological challenges in estimating the costs and benefits of
federal regulation see CRS Report R41763, Analysis of an Estimate of the Total Costs of Federal Regulations, by
Curtis W. Copeland.
40 SBA, Office of Advocacy, “Report on the Regulatory Flexibility Act, FY2014,” January 2015, p. 39, at
https://www.sba.gov/sites/default/files/advocacy/FY2014%20RFA%20Report.pdf. Most of the reported cost savings
($4.6 billion) was attributed to an industry estimate of savings related to changes made by the Environmental Protection
Agency (EPA) to its Effluent Limitation Guidelines, Construction and Development. The Office of Advocacy noted
that a lawsuit filed by industry groups may have also played a role in the EPA’s decision to amend the guidelines. See
ibid., p. 43.
41 Ibid., p. 39.
42 SBA, Office of Advocacy, “Fiscal Year 2015 Congressional Budget Justification Fiscal Year 2013 Annual
Performance Report,” p. 9, at http://www.sba.gov/sites/default/files/files/advocacy_CBJ_fy15.PDF.
43 Ibid., p. 10.
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• state economic profiles, which are compiled annually by Office of Advocacy
staff and provide information concerning small businesses in the state, such as
number of small businesses in the state, the number of people employed by those
small businesses in the state, and various demographic information concerning
the small business owners in the state;44
• firm size economic data, which are compiled by Office of Advocacy staff from
the U.S. Bureau of the Census and the U.S. Bureau of Labor Statistics and
provide information concerning various owner and business characteristics, such
as the number of firms, number of establishments, employment, and annual
payroll by the employment size of the business and by location and industry;45
• quarterly economic bulletins, which are authored by Office of Advocacy staff to
examine trends in small business employment and lending;46
• research projects, searchable by topic, which have been authored by Office of
Advocacy staff, either by choice or by congressional mandate, and by others
sponsored by the Office of Advocacy;47
• fact sheets, which are authored by Office of Advocacy staff, covering various
topics, such as gender differences in financing, the availability of health
insurance among small businesses, and credit card financing;48
• issue briefs, which are authored by Office of Advocacy staff, covering various
topics, such as veteran business owners and access to capital for women- and
minority-owned businesses;49 and
• major sources of data collected by the federal government concerning small
business.50
The Office of Advocacy also provides funding to the Census Bureau to support the generation of
business data by firm size; publishes “The Small Business Advocate,” a monthly newsletter
summarizing the Office of Advocacy’s research endeavors, which has more than 34,000 online
subscribers; and publishes “The Small Business Economy,” an annual report on the status of
small businesses and their role in the national economy.51

44 SBA, Office of Advocacy, “State Economic Profiles,” at https://www.sba.gov/category/advocacy-navigation-
structure/research-and-statistics/state-economic-profiles.
45 SBA, Office of Advocacy, “Firm Size Data,” at https://www.sba.gov/advocacy/firm-size-data.
46 SBA, Office of Advocacy, “Quarterly Bulletins,” at https://www.sba.gov/category/advocacy-navigation-structure/
research-and-statistics/quarterly-indicators.
47 SBA, Office of Advocacy, “Research Issues,” at https://www.sba.gov/category/advocacy-navigation-structure/
research-and-statistics/other-topics.
48 SBA, Office of Advocacy, “Small Business Facts,” at https://www.sba.gov/content/small-business-facts.
49 SBA, Office of Advocacy, “Issue Briefs,” at https://www.sba.gov/advocacy/issue-briefs.
50 SBA, Office of Advocacy, “Small Business Data Resources: U.S. Federal Government,” at https://www.sba.gov/
sites/default/files/Small%20Business%20Data%20Resources%202013.pdf.
51 SBA, Office of Advocacy, Fiscal Year 2016 Congressional Budget Justification and Fiscal Year 2014 Annual
Performance Report
, p. 10, at https://www.sba.gov/sites/default/files/3-
Office%20of%20Advocacy%20FY%202016%20CBJ%20and%20FY%202014%20APR.PDF; SBA, Office of
Advocacy, “Advocacy Newsletter,” at https://www.sba.gov/category/advocacy-navigation-structure/newsroom/
advocacy-newsletter; and SBA, Office of Advocacy, “The Small Business Economy,” at https://www.sba.gov/
advocacy/small-business-economy.
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Advocacy’s Research Activities, FY2014
The Office of Advocacy published 23 contract and internal research reports in FY2014 on a
variety of issues, including small business access to capital, employment, the environment,
minority- and women-owned small businesses, federal procurement, retirement, taxation, and
veteran-owned small businesses. The contracted research projects included reports on access to
capital for women- and minority-owned small businesses, factors influencing new business hiring
decisions, impacts of the April 2010 Deepwater Horizon oil spill in the Gulf of Mexico on small
businesses, evaluation of small business procurement goals, self-employment dynamics among
individuals nearing retirement, Internet sales taxation and the small seller exemption, factors
influencing the involvement of veterans in business creation, and the utilization of federal tax
expenditures by small business.52
Promoting Small Business Outreach
As mentioned previously, the Office of Advocacy engages in outreach activities related to its role
with the RFA. For example, in FY2014, the Office of Advocacy participated in three small
business advocacy review panels with the Environmental Protection Agency and one with the
Consumer Financial Protection Bureau.53 In each case, the Office of Advocacy provided outreach
to small business owners interested in sharing their views concerning the agency’s proposed rule.
The Office of Advocacy also regularly sponsors roundtable discussions, conferences, and
symposia to provide small business owners an opportunity to share their views on issues of
concerns to them. For example, the Office of Advocacy’s regional advocates regularly “interact
directly with small businesses, small business trade associations, governors and state legislatures
to educate them about the benefits of regulatory flexibility and testify at state-level legislation
hearings on small business issues when requested to do so.”54 Regional advocates also “work
closely with the ten Regional Fairness Boards in their respective regions to develop information
for the SBA’s National Ombudsman, as provided for by the Small Business Regulatory
Enforcement Fairness Act and alert businesses in their respective regions about regulatory
proposals that could affect them.”55

52 SBA, Office of Advocacy, “Annual Report of the Office of Economic Research FY2014,” January 2015, at
https://www.sba.gov/sites/default/files/Annual-report-of-the-office-of-economic-research-fy-2014.pdf.
53 Ibid., pp. 57-61.
54 SBA, Office of Advocacy, “Fiscal Year 2015 Congressional Budget Justification Fiscal Year 2013 Annual
Performance Report,” p. 12, at http://www.sba.gov/sites/default/files/files/advocacy_CBJ_fy15.PDF.
55 Ibid. Congress established the Small Business and Agriculture Regulatory Enforcement Ombudsman position and
the ten Regional Fairness Boards in P.L. 104-121, the Small Business Regulatory Enforcement Fairness Act of 1996
(SBREFA). The Ombudsman reports directly to the SBA Administrator and ensures that small businesses subject to an
enforcement activity by a federal regulatory agency are provided a means to comment on the enforcement activity and
to have comments forwarded to the Inspector General of the affected agency in appropriate circumstances. The
Ombudsman reports annually to Congress and affected agencies evaluating the enforcement activities of agency
personnel, including a rating of the responsiveness to small business of the various regional and program offices of
each agency. The Ombudsman also coordinates and reports annually on the activities, findings, and recommendations
of the ten Regional Fairness Boards. Each Regional Fairness Board meets at least annually to advise the Ombudsman
on matters of concern to small businesses relating to federal regulatory enforcement activities. Each Board has five
members, who are owners, operators, or officers of small businesses. They are appointed by the SBA Administrator
after receiving recommendations from the chair and ranking members of the House and Senate Committees on Small
(continued...)
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The Chief Counsel also meets regularly with business organizations and trade associations, and
participates in Office of Advocacy roundtable discussions, conferences, and symposia. The Office
of Advocacy’s economists provide economic presentations at academic conferences, trade
association meetings, think tank events, and other government-sponsored events.56
Advocacy’s Outreach Activities, FY2014
In FY2014, the Office of Advocacy’s regional advocates participated in 536 outreach events. The
Office of Advocacy’s economists also made 26 presentations to academic and other small
business policy-related audiences.57
Current Congressional Issues
As has been discussed, the Office of Advocacy’s responsibilities have expanded over time, and
the House passed legislation (H.R. 527) on February 5, 2015 that would increase its authority still
further. Specifically, H.R. 527 would
• revise and enhance requirements for federal agency notification of the Chief
Counsel prior to the publication of any proposed rule;
• expand the required use of small business advocacy review panels from three
federal agencies to all federal agencies, including independent regulatory
agencies;
• empower the Chief Counsel to issue rules governing federal agency compliance
with the RFA;
• specifically authorize the Chief Counsel to file comments on any notice of
proposed rulemaking, not just when the RFA is concerned; and
• transfer size standard determinations for purposes other than the Small Business
Act and the Small Business Investment Act of 1958 from the SBA’s
Administrator to the Chief Counsel.
Arguments for Expanding Advocacy’s Authority
Advocates of expanding the Office of Advocacy’s authority and role under the RFA argue that
legislation is necessary to “close loopholes [in the RFA] and more effectively reduce the
disproportionate burden that over-regulation places on small entities, thereby enhancing job
creation and hastening economic recovery.”58 They argue that

(...continued)
Business. Board members serve at the pleasure of the SBA Administrator for terms of three years or less.
56 Ibid.
57 SBA, Office of Advocacy, Fiscal Year 2016 Congressional Budget Justification and Fiscal Year 2014 Annual
Performance Report
, p. 16, at https://www.sba.gov/sites/default/files/3-
Office%20of%20Advocacy%20FY%202016%20CBJ%20and%20FY%202014%20APR.PDF.
58 U.S. Congress, House Committee on the Judiciary, Regulatory Flexibility Improvements Act of 2013, report to
accompany H.R. 2542, 113th Cong., 1st sess., December 11, 2013, H.Rept. 113-288, Part 1 (Washington: GPO, 2013),
(continued...)
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recent regulatory expansions and the future threat of further excessive federal regulation—
such as under the waves of regulation occurring to implement the Patient Protection and
Affordable Care Act and the Dodd-Frank Wall Street Reform and Consumer Protection
Act—have created immense regulatory burdens and uncertainty for the economy, chilling
job creation, investment and economic growth and suppressing America’s economic freedom
and standing among the world’s economies. These effects are particularly burdensome on
small businesses – and since start-up firms are the source of net job creation in the U.S.
economy it is only logical that the impact of these effects on small businesses contributes
substantially to the economy’s inability to create sufficient levels of new jobs.59
Advocates of expanding the Office of Advocacy’s authority also note that the Government
Accountability Office (GAO) has found that the lack of a uniform definition for the terms
significant economic impact, and substantial number of small entities contributes to inconsistent
compliance with the RFA across federal agencies. They argue that GAO’s findings are further
evidence that the RFA needs to be amended.60
Arguments Against Expanding Advocacy’s Authority
Opponents of expanding the Office of Advocacy’s authority and role under the RFA argue that the
provisions being advocated are part of an “ongoing attack on federal regulation,” presented under
the guise of “pro-small business rhetoric, which will erect significant barriers to rulemaking that
will hinder the promulgation of critical public health and safety protections.”61 They argue that
these provisions are
(1) based on the false premise that regulatory costs stifle economic growth and job creation;
(2) threatens public health and safety by severely undermining federal agency rulemaking;
(3) imposes additional duties on agencies while failing to provide for any additional
resources to meet such burdens, and (4) allows more opportunities for industry to delay or
defeat proposed rulemakings.62

(...continued)
p. 2.
59 Ibid., pp. 7-8; and U.S. Congress, House Committee on the Judiciary, Small Business Regulatory Flexibility
Improvements Act of 2015
, report to accompany H.R. 527, 114th Cong., 1st sess., February 2, 2015, H.Rept. 114-12,
Part 1 (Washington: GPO, 2015), p. 8.
60 U.S. Congress, House Committee on the Judiciary, Regulatory Flexibility Improvements Act of 2013, report to
accompany H.R. 2542, 113th Cong., 1st sess., December 11, 2013, H.Rept. 113-288, Part 1 (Washington: GPO, 2013),
p. 3; and U.S. Congress, House Committee on the Judiciary, Small Business Regulatory Flexibility Improvements Act of
2015
, report to accompany H.R. 527, 114th Cong., 1st sess., February 2, 2015, H.Rept. 114-12, Part 1 (Washington:
GPO, 2015), p. 3. See U.S. General Accounting (now Accountability) Office, Regulatory Flexibility Act: Key Terms
Still Need to Be Clarified
, GAO-01-669T, April 24, 2001, pp. 1-2, at http://www.gao.gov/assets/110/108793.pdf; U.S.
General Accounting (now Accountability) Office, Regulatory Flexibility Act: Clarification of Key Terms Still Needed,
GAO-02-491T, March 6, 2002, pp. 3-4, at http://www.gao.gov/assets/110/109134.pdf; U.S. General Accounting (now
Accountability) Office, Regulatory Reform: Prior Reviews of Federal Regulatory Process Initiatives Revel
Opportunities for Improvements
, GAO-05-939T, July 27, 2005, pp. 5-7, at http://www.gao.gov/assets/120/112084.pdf;
and U.S. General Accounting (now Accountability) Office, Regulatory Flexibility Act: Congress Should Revisit and
Clarify Elements of the Act to Improve Its Effectiveness,
GAO-06-998T, July 20, 2006, pp. 1, 4-10, at
http://www.gao.gov/assets/120/114481.pdf.
61 U.S. Congress, House Committee on the Judiciary, Regulatory Flexibility Improvements Act of 2013, report to
accompany H.R. 2542, 113th Cong., 1st sess., December 11, 2013, H.Rept. 113-288, Part 1 (Washington: GPO, 2013),
p. 58.
62 U.S. Congress, House Committee on the Judiciary, Small Business Regulatory Flexibility Improvements Act of 2015,
(continued...)
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Opponents also argue that these provisions
do nothing to alleviate the purported burden on small entities of complying with federal
regulations. In fact, it includes no provision that offers assistance to small entities, whether
through subsidies, government guaranteed loans, preferential tax treatment for small firms,
or fully funded compliance assistance offices. Instead, the bill merely aggrandizes the power
of the SBA’s Office of Advocacy and of the professional lobbying class in Washington.63
Concluding Observations
The SBA’s Office of Advocacy is a relatively small office with a relatively large mandate—to
represent the interests of small business in the regulatory process, produce and promote small
business economic research, and facilitate small business outreach across the federal government.
It faces several challenges.
First, the Office of Advocacy is generally recognized as being an independent office, but it is
housed within the SBA and remains subject to its influence through (1) its proximity to the
agency and its organizational culture; (2) the budgetary process, which provides the SBA
Administrator a role, albeit recently reduced, in determining Advocacy’s budget; and (3) the sheer
size of the SBA (more than 3,200 full-time employees and a budget of nearly $1 billion) relative
to the Office of Advocacy which, given their statutorily overlapping missions as advocates for
small businesses, makes it more difficult than would otherwise be the case for the Office of
Advocacy to be recognized by stakeholders as the definitive voice for small businesses.
Second, Chief Counsels tend to have relatively short tenures (three years, eight years, one year,
seven years, six years, and four years). When they leave office, as the most recent Chief Counsel
did at the end of 2014, there have often been delays in naming a successor, creating continuity
problems for the Office of Advocacy. The current position is being filled on an interim basis by
Claudia Rodgers, a long-time Office of Advocacy senior staff member.64 Chief Counsels leave
office for various reasons, such as a change in Administration or for more lucrative positions in
the private sector.
Third, one of the Office of Advocacy’s primary functions is to monitor and report on federal
agency compliance with the RFA, provide comments on proposed rules, and train federal
regulatory officials to assist them in complying with the RFA’s provisions. However, as GAO has
noted, the RFA does not define significant economic impact or substantial number of small
entities, two key terms for triggering the Advocacy’s role under the RFA. The lack of clarity
concerning these key terms makes it difficult for the Office of Advocacy to objectively determine
agency compliance with the RFA and also makes it more difficult for the Advocacy to train

(...continued)
report to accompany H.R. 527, 114th Cong., 1st sess., February 2, 2015, H.Rept. 114-12, Part 1 (Washington: GPO,
2015), p. 57.
63 Ibid., pp. 74, 75.
64 Winslow Sargeant announced his resignation as Chief Counsel on July 30, 2013, effective at the end of calendar year
2014. President Obama’s nomination of Gilberto de Jesus for the position of Chief Counsel was received in the Senate
on September 8, 2014, and referred to the Committee on Small Committee and Entrepreneurship. President Obama
resubmitted his nomination of Gilberto de Jesus for the position of Chief Counsel to the Senate on January 8, 2015. The
nomination was referred to the Senate’s Committee on Small Committee and Entrepreneurship.
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federal regulatory officials in how to come into compliance with the act. GAO and others have
recommended that Congress clarify the meaning of these terms. However, the RFA’s original
authors purposely decided not to provide a precise definition for these terms. They argued that the
varying missions and constituencies served by federal agencies necessitated the provision of
discretion to allow federal agencies to “determine what is significant to their programs and
particular constituencies.”65
Fourth, the Office of Advocacy is subject to criticism from those who believe that it should be
more aggressive in preventing federal regulations (i.e., from those who generally oppose federal
regulations, especially regulations related to environmental issues and health care reform) and
from those who believe that it should be less aggressive in this regard (i.e., from those who
generally view federal regulations favorably, especially in addressing environmental and
workplace safety issues).66 Thus, the Office of Advocacy often finds itself involved in ideological
and partisan disputes concerning the outcome of federal regulatory policies for which it does not
have the final say.
Finally, the Office of Advocacy’s relatively limited budget restricts its ability to produce and
promote economic research on small businesses and to engage in outreach activities, particularly
outreach activities not directly related to its RFA role. It could be argued that the Office of
Advocacy does not need additional resources for these endeavors because the SBA engages in
these same activities. Once again, this reflects the challenges the Office of Advocacy faces as an
independent office operating within a much larger federal agency with an overlapping mission.

Author Contact Information
Robert Jay Dilger
Senior Specialist in American National Government
rdilger@crs.loc.gov, 7-3110


65 U.S. Congress, Senate Committee on the Judiciary, The Regulatory Flexibility Act, report to accompany S. 1974, 95th
Cong., 2nd sess., October 11, 1978, S.Rept. 95-1322 (Washington: GPO, 1978), p. 30.
66 See SBA, Office of Advocacy, “Letter to The Honorable Olympia J. Snowe concerning the ability of small
businesses to claim the new health care tax credit under the Patient Protection and Affordable Care Act (ACA), April
11, 2011, at http://www.sba.gov/content/response-letter-dated-041111-honorable-olympia-j-snowe; U.S. Congress,
House Committee on the Judiciary, Regulatory Flexibility Improvements Act of 2013, report to accompany H.R. 2542,
113th Cong., 1st sess., December 11, 2013, H.Rept. 113-288, Part 1 (Washington: GPO, 2013), pp. 49, 58-59; Sidney
Shapiro and James Goodwin, “Distorting the Interests of Small Business: How the Small Business Administration
Office of Advocacy’s Politicization of Small Business Concerns Undermines Public Health and Safety,” Center for
Progressive Reform, Washington, DC, January 2013, at http://www.progressivereform.org/articles/
SBA_Office_of_Advocacy_1302.pdf; and Randy Rabinowitz, Katie Greenhaw, and Katie Weatherford, “Small
Businesses, Public Health, and Scientific Integrity: Whose Interests Does the Office of Advocacy at the Small Business
Administration Serve?” The Center for Effective Government, Washington, DC, at http://www.foreffectivegov.org/
office-of-advocacy-report.
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