SBA Office of Advocacy:
Overview, History, and Current Issues
Updated February 8, 2022
Congressional Research Service
https://crsreports.congress.gov
R43625

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

Summary
The Office of Advocacy (Advocacy) is an “independent” office within the U.S. Smal Business
Administration (SBA) that advances “the views and concerns of smal businesses before
Congress, the White House, federal agencies, the federal courts, and state and local policymakers
as appropriate.” The Chief Counsel for Advocacy (Chief Counsel) directs the office and is
appointed by the President from civilian life with the advice and consent of the Senate.
Advocacy is a relatively smal office with a relatively large mandate—to represent the interests of
smal business in the regulatory process, provide Regulatory Flexibility Act (RFA) compliance
training to federal regulatory officials, produce and promote smal business economic research to
inform policymakers and other stakeholders concerning the impact of federal regulatory burdens
on smal businesses and the role of smal businesses in the economy, and facilitate smal business
outreach across the federal government.
This report examines 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 115th Congress,
the House passed H.R. 5, the Regulatory Accountability Act of 2017 (Title III, Smal Business
Regulatory Flexibility Improvements Act), which would have expanded Advocacy’s
responsibilities. It would have revised and enhanced requirements for federal agency notification
of the Chief Counsel prior to the publication of any proposed rule; expanded the required use of
smal business advocacy review panels from three federal agencies to al federal agencies,
including independent regulatory agencies; empowered the Chief Counsel to issue rules
governing federal agency compliance with the RFA; specifical y authorized the Chief Counsel to
file comments on any notice of proposed rulemaking, not just when the RFA is concerned; and
transferred size standard determinations for purposes other than the Smal Business Act and the
Smal Business Investment Act of 1958 from the SBA’s Administrator to the Chief Counsel. The
House passed similar legislation during the 114th Congress (H.R. 527).
The analysis suggests that Advocacy faces several chal enges.
 Advocacy, general y recognized as being an independent office, is housed within
the much larger SBA which, given their statutorily overlapping missions as
advocates for smal businesses, makes it more difficult for stakeholders to
recognize Advocacy as the definitive voice for smal businesses.
 Chief Counsels tend to have relatively short tenures, creating continuity problems
for Advocacy.
 The RFA does not define significant economic impact or substantial number of
small entities, two key terms for triggering Advocacy’s role under the RFA. The
lack of clarity concerning these key terms makes it difficult for Advocacy to
objectively determine agency compliance with the RFA and to train federal
regulatory officials in how to come into compliance with the act.
 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.
 Advocacy’s ability to produce and promote economic research on smal
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.
Congressional Research Service

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

Introduction
The Office of Advocacy (Advocacy) is an “independent” office within the U.S. Smal Business
Administration (SBA) that is responsible for advancing “the views and concerns of smal
businesses before Congress, the White House, federal agencies, the federal courts, and state and
local policymakers as appropriate.”1 The Chief Counsel for Advocacy (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 Advocacy support the development and growth of American smal
businesses by
 “intervening early in federal agencies’ regulatory development processes on
proposals that affect smal entities and providing Regulatory Flexibility Act
compliance training to federal agency policymakers and regulatory development
officials;
 producing research to inform policymakers and other stakeholders on the impact
of federal regulatory burdens on smal businesses, to document the vital role of
smal businesses in the economy, and to explore and explain the wide variety of
issues of concern to the smal business community; and
 fostering a two-way communication between federal agencies and the smal
business community.”2
Advocacy has 50 staff members and received an appropriation of $9.19 mil ion for FY2021.3
Advocacy’s responsibilities have expanded over time, and legislation has been introduced in
recent Congresses to increase its authority stil further. For example, during the 115th Congress,
the House passed H.R. 5, the Regulatory Accountability Act of 2017 (Title III, Smal Business
Regulatory Flexibility Improvements Act), by a vote of 238-183. The bil would have, among
other provisions,
 revised and enhanced requirements for federal agency notification of the Chief
Counsel prior to the publication of any proposed rule;
 expanded the required use of smal business advocacy review panels from three
federal agencies to al federal agencies, including independent regulatory
agencies;
 empowered the Chief Counsel to issue rules governing federal agency
compliance with the RFA;
 specifical y authorized the Chief Counsel to file comments on any notice of
proposed rulemaking, not just when the RFA is concerned; and

1 U.S. Small Business Administration (SBA), “Office of Advocacy: About Us,” at https://www.sba.gov/category/
advocacy-navigation-structure/about -us-0; and SBA, Office of Advocacy, Fiscal Year 2022 Congressional Budget
Justification and Fiscal Year 2020 Annual Perform ance Report, p. 174, at https://www.sba.gov/document/report -
congressional-budget -justification-annual-performance-report (hereinafter cited as SBA, FY2022 Congressional Budget
Justification and FY2020 Annual Report).
2 SBA, FY2022 Congressional Budget Justification and FY2020 Annual Report, p. 174.
3 SBA, Office of Advocacy, “Staff,” at https://advocacy.sba.gov/about/staff/; and P.L. 116-260, the Consolidated
Appropriations Act, 2021.
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 transferred size standard determinations for purposes other than the Smal
Business Act and the Smal Business Investment Act of 1958 from the SBA’s
Administrator to the Chief Counsel.4
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 the
House passed on February 27, 2014, and in H.R. 4, the Jobs for America Act (of 2014), which the
House passed on September 18, 2014. During the 114th Congress, these provisions were included
in H.R. 527, the Smal Business Regulatory Flexibility Improvements Act of 2015, which was
passed by the House on February 5, 2015.
More recently, S. 83, the Advocacy Empowerment Act of 2019, would have empowered the Chief
Counsel to issue rules governing federal agency compliance with the RFA. Also, H.R. 6454, the
Smal Business Advocacy Improvements Act of 2022, would specifical y authorize the Office of
Advocacy to represent smal business views and interests before foreign governments and other
international entities concerning regulatory and trade initiatives that may affect smal businesses.
In addition, during the 114th Congress, S. 2847, the Prove It Act of 2016, which was reported by
the Senate Committee on Smal Business and Entrepreneurship, would have authorized the Chief
Counsel to request the Office of Management and Budget’s (OMB’s) Office of Information and
Regulatory Affairs (OIRA) to review any federal agency certification that a proposed rule, if
promulgated, wil not have a significant economic impact on a substantial number of smal
entities and, as a result, is not required to submit a regulatory flexibility analysis of the rule. If it
is determined that the proposed rule would, if promulgated, have a significant economic impact
on a substantial number of smal entities, the federal agency would then be required to perform
both an initial and a final regulatory flexibility analysis for the rule. The bil was reintroduced
during the 115th Congress (S. 2014, the Prove It Act of 2017).
This report examines 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.
Advocacy’s Origins
The Smal 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 smal -business
concerns.” The SBA provided this advocacy function primarily through its administration of
smal business loan guaranty programs, contracting assistance programs, and management and
training programs. The SBA Administrator serves as the lead advocate for smal businesses within
the federal government.

4 T he size standard provision was in H.R. 585, the Small Business Size Standard Flexibility Act of 2011, which was
introduced during the 112th Congress. T he 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, Sm all Business
Size Standards: A Historical Analysis of Contem porary Issues, by Robert Jay Dilger.
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Office of Chief Counsel for Advocacy
During the early 1970s, several smal business organizations indicated at congressional hearings
that they were not wholly satisfied with the SBA’s advocacy efforts, especial y in achieving
regulatory relief for smal businesses. Congress responded to these concerns by approving
legislation (P.L. 93-386, the Smal 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.5
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 smal businesses;
2. counsel smal businesses on how to resolve questions and problems concerning
the relationship of the smal business to the federal government;
3. develop proposals for changes in the policies and activities of any agency of the
federal government that wil better fulfil the purposes of the Smal Business Act
and communicate such proposals to the appropriate federal agencies;
4. represent the views and interests of smal businesses before other federal
agencies whose policies and activities may affect smal 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 smal
businesses, and information on how smal businesses can participate in or make
use of such programs and services.6
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.7
The Office of Chief Counsel was placed under the Office of Advocacy, Planning and Research,
which was headed by an Assistant Administrator.8 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 Smal Business Organizations. The SBA’s Office
of Chief Counsel for Advocacy was fully operational as of March 1, 1975.9

5 U.S. Congress, House Select Committee on Small Business, Small Business Amendment of 1974, report to accompany
H.R. 15578, 93rd Cong., 2nd sess., July 3, 1974, H.Rept. 93-1178 (Washington: GPO, 1974), p. 8.
6 P.L. 93-386, the Small Business Amendment s of 1974.
7 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.
8 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.
9 U.S. Congress, Senate Select Committ ee 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 Sm all Business Adm inistration: 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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An “Independent” Office of Advocacy
As the Office of Advocacy began operations, several smal 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 OMB
Director’s influence. In their view, OMB, at that time, was more attuned to promoting the
interests of large businesses than it was to promoting the interests of smal businesses.10
Congress responded to these concerns by passing P.L. 94-305, to amend the Smal Business Act
and Smal 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.11
P.L. 94-305 also
 retained Advocacy’s five duties as identified in P.L. 93-386;
 specified that one of Advocacy’s primary functions was to examine the role of
smal business in the American economy and the problems faced by smal
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;12
 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 mil ion for Advocacy, with any appropriated
funds remaining available until expended.13

10 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.
11 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 seven
Chief Counsels, to date, to be nominated by the President (nominated by President Jimmy Carter 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,
nominated by President Ronald Reagan), T homas P. Kerester (1992 -1993, nominated by President George Bush), Jere
Walton Glover (1994-2001, nominated by President William Clinton), T homas M. Sullivan (2002 -2008, nominated by
President George W. Bush), Winslow Lorenzo Sargeant (2010 recess appointment, Senate confirmation in 2011, left in
January 2015, nominated by President Barack Obama), and Darryl L. DePriest (December 10, 2015-January 2017,
nominated by President Barack Obama).
12 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.
13 U.S. Congress, Senate Select Committee on Small Business, Subcommittee on Government Regulation and Small
Business Advocacy, The Study of Sm all Business, hearing on T he Study of Small Business, 95th Cong., 1st sess., June
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It was at this time that the word independent began to be used to describe the Chief Counsel and
the Office of Advocacy. However, Advocacy remained a part of the SBA and subject to the sitting
Administration’s influence. For example, at that time, Advocacy’s budget was provided through
the SBA’s salaries and expenses account, which was approved by the SBA Administrator;
Advocacy’s annual staffing al otment was subject to the SBA Administrator’s approval; and some
senior staff within Advocacy were vetted by the White House personnel office prior to hiring.14
Advocacy’s Regulatory Oversight Role Expanded
Advocacy’s duties were further expanded following enactment of P.L. 96-354, the Regulatory
Flexibility Act of 1980 (RFA, as amended).15 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 consider 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.16
The RFA’s sponsors argued that federal agencies should be required to examine the impact of
regulations on smal businesses because federal regulations tend to be “uniform in design, permit
little discretion in their implementation, and place a disproportionate burden upon smal
businesses, smal organizations and smal governmental bodies.”17 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.18
Economist Milton Kafoglis, a member of the President Jimmy Carter’s Council on Wage and
Price Stability, testified that

29, 1977 (Washington: GPO, 1977), pp. 12 -13.
14 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.
15 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: Im plem entation Issues and Proposed Reform s, coordinated by
Maeve P. Carey.
16 SBA, Office of Advocacy, Report on the Regulatory Flexibility Act FY2013, p. 1, at http://www.sba.gov/sites/
default/files/13regflx.pdf.
17 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.
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. 4.
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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
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.19
As discussed below, the RFA requires federal agencies to assess the impact of their forthcoming
regulations on small entities, which the act defines as smal businesses, smal governmental
jurisdictions, and certain smal not-for-profit organizations.20 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 Smal Business Jobs Act of 2010, further enhanced Advocacy’s independence
by ending the practice of including 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 Advocacy, “which shal be designated in a separate
account in the General Fund of the Treasury.” The Smal Business Jobs Act also requires the SBA
Administrator to provide 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 shal 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, 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

19 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), 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.
20 T he 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 sm all 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 sm all governm ental 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 t erm 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 sm all entity
shall have the same meaning as the terms sm all business, sm all organization and sm all governm ental jurisdiction
defined in paragraphs (3), (4), and (5) of this section. See 5 U.S.C. §601 (3) -(6).
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document and annual performance report. Advocacy has continued to issue its own budget
justification document in each of the Administration’s subsequent budget requests.21
Current Organizational Structure and Funding
As mentioned previously, Advocacy currently has 50 staff positions (typical y with three to six
vacancies at any given time): 4, including the Chief Counsel (currently vacant), in the Office of
the Chief Counsel; 16 in the Office of Interagency Affairs (regulatory staff); 8 in the Office of
Economic Research; 6 in the Office of Information; 11 in the Office of Regional Affairs (regional
advocates); and 5 in the Administrative Support Branch. The Office of Advocacy’s organizational
chart is presented below, with its anticipated staffing level.
Figure 1. SBA Office of Advocacy Organizational Chart
(anticipated staf ing level, FY2021)

Source: U.S. Smal Business Administration, Office of Advocacy, “Office of Advocacy Staff,” at
https://www.sba.gov/advocacy/office-advocacy-staff.
As mentioned, Advocacy received an appropriation of $9.19 mil ion for FY2021. Staff salaries
and benefits account for about 95% of Advocacy’s budget, with the remainder used for economic
research grants and direct expenses, such as subscriptions, travel, training, and office supplies.22
The Biden Administration has requested $9.62 mil ion for Advocacy in FY2022, which would
al ow Advocacy to increase its staff to 55 full-time equivalent positions.23

21 T he Office of Advocacy’s congressional budget documents can be accessed on the SBA’s website at
https://www.sba.gov/document/report —congressional-budget-justification-annual-performance-report.
22 SBA, FY2022 Congressional Budget Justification and FY2020 Annual Report, p. 175.
23 SBA, FY2022 Congressional Budget Justification and FY2020 Annual Report, p. 175.
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Advocacy and Federal Regulations
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 Smal Entities in
Agency Rulemaking (August 13, 2002). Advocacy also comments on proposed rules and
participates in smal 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 smal entities, which the act defines as including smal
businesses, smal governmental jurisdictions, and certain smal not-for-profit organizations.
According to 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 wel 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 smal entities to which the proposed rule wil 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 smal 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 smal 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
which are likely to have a significant economic impact on a substantial number
of smal entities;
 provide their regulatory flexibility agenda to the Chief Counsel and to smal
businesses or their representatives;

24 SBA, Office of Advocacy, “A Guide for Government Agencies: How to Comply with the Regulatory Flexibility
Act,” May 2012, p. 1, at https://www.sba.gov/sites/default/files/rfaguide_0512_0.pdf.
25 T he 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 CRS Report RL34355, The Regulatory Flexibility Act: Implementation Issues and Proposed Reforms, coordinated by
Maeve P. Carey.
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 retrospectively review rules that have or wil 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
smal entities; and
 ensure that smal 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 smal 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 smal 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 smal 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 Final y, 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 annual y on agencies’
compliance with the act. The Chief Counsel accomplishes this primarily by reviewing and
commenting on proposed regulations and by participating in smal 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 Smal Entities in Agency Rulemaking (August
13, 2002), requires federal agencies to make information publicly available concerning how they
wil comply with the RFA’s statutory mandates.31 It also requires federal agencies to send to
Advocacy copies of any draft regulations that may have an impact on a substantial number of
smal entities. Agencies must send these draft regulations to 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 Advocacy’s comments on the proposed rule and must address
these comments in the final rule published in the Federal Register.32

28 SBA, Office of Advocacy, “Report on the Regulatory Flexibility Act, FY2014,” January 2015, p p. 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; T itle III, the Small Business Regulatory Enforcement Fairness Act of 1996 (SBREFA). T hat 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 T he agency proposing the rule normally fixes the convening date after consulting with Advocacy and OMB’s Office
of Information and Regulatory Affairs. T he 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.
32 SBA, Office of Advocacy, “Report on the Regulatory Flexibility Act, FY201 6,” January 2017, p. 11, at
https://www.sba.gov/sites/default/files/advocacy/2016_RFA_Annual_Report.pdf (hereinafter cited as SBA,
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Executive Order 13272 requires Advocacy to
 notify federal agencies concerning how to comply with the RFA, which is
accomplished primarily through Advocacy’s periodic publication of A Guide for
Government Agencies: How to Comply with the Regulatory Flexibility Act and
through Advocacy’s compliance training program;
 report annual y on federal agency compliance with the executive order, which is
accomplished primarily through 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 Advocacy’s compliance training program.33
Advocacy’s Regulatory Activities
Advocacy provided 19 official public comment letters to 12 federal agencies on a variety of
proposed rules in FY2020.34 It also hosted 11 roundtable discussions on various topics, including
proposed rules and regulatory issues.35 These roundtable discussions provided stakeholders an
opportunity to share their views concerning the impact of proposed rules. Advocacy also provided
training on RFA compliance to 124 federal officials.36
Each year, Advocacy provides an estimate of the regulatory cost savings its activities provide to
smal 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.”37 These 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 methodological y chal enging.38 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 Advocacy, estimating regulatory cost savings from
its activities is even more chal enging because it is nearly impossible to determine what changes

“Regulatory Flexibility Act Report, FY2016”).
33 SBA, “Regulatory Flexibility Act Report, FY2016,” p. 15.
34 SBA, FY2022 Congressional Budget Justification and FY2020 Annual Report, pp. 180, 181. Advocacy provided 28
official public comment letters to federal agencies on a variety of proposed rules in FY2013, 22 in FY2014, 20 in
FY2015, 20 in FY2016, 24 in FY2017, 17 in FY2018, and 22 in FY2019.
35 SBA, FY2022 Congressional Budget Justification and FY2020 Annual Report, p. 181. Advocacy hosted 21
roundtable discussions in FY2013, 19 in FY2014, 21 in FY2015, 25 in FY2016 and FY2017 , 23 in FY2018, and 17 in
FY2019.
36 SBA, FY2022 Congressional Budget Justification and FY2020 Annual Report, p. 191. Advocacy provided training
on RFA compliance to 157 federal officials at rule-writing agencies in FY2016, 195 in FY2017, 132 in FY2018, and
113 in FY2019.
37 SBA, Office of Advocacy, “Report on the Regulatory Flexibility Act, FY2013,” February 2014, p. 33, at
https://www.sba.gov/sites/default/files/13regflx.pdf.
38 For further information and analysis concerning the methodological challenges in estimating the costs and benefits of
federal regulation see out -of-print CRS Report R41763, Analysis of an Estim ate of the Total Costs of Federal
Regulations, available to congressional clients upon request.
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to these regulations would have been made during the review and comment period if Advocacy
did not exist.
Advocacy reported that its intervention in rules that were made final resulted in first-year
regulatory cost savings on behalf of smal businesses of $2.259 bil ion in FY2020.39
Producing and Promoting Research on
Small Businesses
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.”40
These products typical y relate to the role that smal businesses “play in the economy, including
the availability of credit, the effects of regulations and taxation, the role of firms owned by
women, minority and veteran entrepreneurs, innovation, and factors that encourage or inhibit
smal business start-up, development and growth.”41
In addition to sponsoring and conducting research on smal business, Advocacy maintains web
pages with links to
 state economic profiles, which are compiled annual y by Office of Advocacy
staff and provide information concerning smal businesses in the state, such as
number of smal businesses in the state, the number of people employed by those
smal businesses in the state, and various demographic information concerning
the smal business owners in the state;42
 firm size economic data, which are compiled by 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;43
 quarterly economic bulletins, which are authored by Advocacy staff to examine
trends in smal business employment and lending;44
 research projects which have been authored by Office of Advocacy staff, either
by choice or by congressional mandate, and by others sponsored by Advocacy;45

39 SBA, FY2022 Congressional Budget Justification and FY2020 Annual Report, p. 180. T he Office of Advocacy
reported that its intervention in rules that were made final resulted in regulatory cost savings on behalf of smal l
businesses of more than $1.6 billion in FY2015, $1.4 billion in FY2016, $1.151 billion in FY2017, $255.3 million in
FY2018, and $773 million in FY2019.
40 SBA, FY2022 Congressional Budget Justification and FY2020 Annual Report, p. 185.
41 SBA, FY2022 Congressional Budget Justification and FY2020 Annual Report, p. 192.
42 SBA, Office of Advocacy, “State Economic Profiles,” at https://www.sba.gov/category/advocacy-navigation-
structure/research-and-statistics/state-economic-profiles.
43 SBA, Office of Advocacy, “ Firm Size Data,” at https://www.sba.gov/advocacy/firm-size-data.
44 SBA, Office of Advocacy, “ Quarterly Bulletins,” at https://www.sba.gov/category/advocacy-navigation-structure/
research-and-statistics/quarterly-indicators.
45 SBA, Office of Advocacy, “ Research Reports,” at https://advocacy.sba.gov/category/reports/.
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 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 smal businesses, and credit card financing;46
 issue briefs, which are authored by Advocacy staff, covering various topics, such
as veteran business owners and access to capital for women- and minority-owned
businesses;47 and
 major sources of data col ected by the federal government concerning smal
business.48
Advocacy also provides funding to the Census Bureau to support the generation of business data
by firm size; publishes “The Smal Business Advocate,” a newsletter summarizing Advocacy’s
research endeavors, which has more than 36,000 online subscribers; and publishes “The Smal
Business Economy,” an annual report on the status of smal businesses and their role in the
national economy.49
Advocacy’s Research Activities
Advocacy published 21 contract and internal research and data reports in FY2020.50 These reports
covered a variety of issues, including smal business lending, minority-owned credit market
experiences, and updates of fact sheets and reports such as Small Business Profiles for the
Congressional Districts.51
In addition, Advocacy’s economic research staff sponsored four “Smal Business Economic
Research Forums.” These forums provide economists and researchers an opportunity “to discuss
a key economic topic” and help “to keep Advocacy’s staff up-to-date on the latest data and
research from other agencies and researchers.”52
Promoting Small Business Outreach
As mentioned, Advocacy engages in outreach activities related to its role with the RFA. For
example, Advocacy participated in seven smal business advocacy review panels in FY2016 (one
with OSHA, two with the CFPB, and four with the EPA), one panel in FY2018 (with OSHA),
none in FY2019, two in FY2020 (one with OSHA and one with CFPB), and six in FY2021 (one
with OSHA, one with the CFPB, and four with the EPA).53 In each case, Advocacy provided

46 SBA, Office of Advocacy, “ Small Business Facts,” at https://advocacy.sba.gov/?s=small+business+facts.
47 SBA, Office of Advocacy, “ Issue Briefs,” at https://advocacy.sba.gov/?s=issue+briefs.
48 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.
49 SBA, FY2022 Congressional Budget Justification and FY2020 Annual Report, p. 186; and SBA, Office of
Advocacy, “Advocacy Newsletter,” at https://advocacy.sba.gov/category/news-articles/news/newsletter/.
50 SBA, FY2022 Congressional Budget Justification and FY2020 Annual Report, p. 192. T he Office of Advocacy
published 26 contract and internal research reports in FY2015, 26 in FY2016, and 20 in FY2017, FY2018, and
FY2019.
51 SBA, FY2022 Congressional Budget Justification and FY2020 Annual Report, p. 187.
52 SBA, FY2022 Congressional Budget Justification and FY2020 Annual Report, p. 193. T he Office of Advocacy
sponsored 8 Small Business Economic Research Forums in FY2015, 10 in FY2016, 6 in FY2017 and FY2018, and 5 in
FY2019.
53 SBA, Office of Advocacy, “Report on the Regulatory Flexibility Act, FY2016,” January 2017, p. 17, at
https://www.sba.gov/sites/default/files/advocacy/2016_RFA_Annual_Report.pdf; SBA, Office of Advocacy, Fiscal
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outreach to smal business owners interested in sharing their views concerning the agency’s
proposed rule.
Advocacy also regularly sponsors roundtable discussions, conferences, and symposia to provide
smal business owners an opportunity to share their views on issues of concerns to them. For
example, Advocacy’s regional advocates regularly “interact directly with smal businesses, smal
business trade associations, governors and state legislatures to educate them about the benefits of
regulatory flexibility and testify at state-level legislation hearings on smal 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 Smal Business Regulatory Enforcement Fairness Act and alert businesses in
their respective regions about regulatory proposals that could affect them.”55
The Chief Counsel also meets regularly with business organizations and trade associations, and
participates in Advocacy roundtable discussions, conferences, and symposia. Advocacy’s
economists provide economic presentations at academic conferences, trade association meetings,
think tank events, and other government-sponsored events.56

Year 2020 Congressional Budget Justification and Fiscal Year 2018 Annual Perform ance Report, p. 188, at
https://www.sba.gov/document/report -congressional-budget-justification-annual-performance-report; SBA, FY2021
Congressional Budget Justification and FY2019 Annual Report, p. 208, at https://www.sba.gov/document/report -
congressional-budget -justification-annual-performance-report; SBA, FY2022 Congressional Budget Justification and
FY2020 Annual Report, p. 182; and SBA, Office of Advocacy, “ SBREFA Panels,” at
https://advocacy.sba.gov/resources/reference-library/sbrefa/.
54 SBA, Office of Advocacy, Fiscal Year 2015 Congressional Budget Justification and Fiscal Year 2013 Annual
Perform ance Report, p. 12, at http://www.sba.gov/sites/default/files/files/advocacy_CBJ_fy15.PDF (hereinafter cited
as SBA, FY2015 Congressional Budget Justification and FY2013 Annual Report).
55 SBA, FY2015 Congressional Budget Justification and FY2013Annual Report, p. 12. 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) . T he 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 enforcem ent activity and to have comments forwarded to
the Inspector General of the affected agency in appropriate circumstances. T he 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. T he 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. T hey are appointed by the SBA Administrator after receiving
recommendations from the chair and ranking members of the House and Senate Committees on Small Business. Board
members serve at the pleasure of the SBA Administrator for terms of three years or less.
56 SBA, Office of Advocacy, Fiscal Year 2019 Congressional Budget Justification and Fiscal Year 2017 Annual
Perform ance Report, p. 4, at https://www.sba.gov/sites/default/files/aboutsbaarticle/
FY_2019_CBJ_Office_of_Advocacy.pdf.
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Advocacy’s Outreach Activities
Advocacy’s regional advocates participated in 552 outreach events in FY2020.57 Advocacy’s
economists also made 12 presentations to academic, media, or other smal business policy-related
audiences.58
Current Congressional Issues
As has been discussed, Advocacy’s responsibilities have expanded over time. During the 115th
Congress, the House passed H.R. 5, the Regulatory Accountability Act of 2017 (Title III, Smal
Business Regulatory Flexibility Improvements Act), which would have increased Advocacy’s
authority stil further. Specifical y, H.R. 5 would have
 revised and enhanced requirements for federal agency notification of the Chief
Counsel prior to the publication of any proposed rule;
 expanded the required use of smal business advocacy review panels from three
federal agencies to al federal agencies, including independent regulatory
agencies;
 empowered the Chief Counsel to issue rules governing federal agency
compliance with the RFA;
 specifical y authorized the Chief Counsel to file comments on any notice of
proposed rulemaking, not just when the RFA is concerned; and
 transferred size standard determinations for purposes other than the Smal
Business Act and the Smal Business Investment Act of 1958 from the SBA’s
Administrator to the Chief Counsel.
In the 116th Congress, the House also passed H.R. 128, the Smal Business Advocacy
Improvements Act of 2019, on January 8, 2019, by voice vote. The bil would have expanded the
list of Advocacy’s primary functions and duties by specifying that Advocacy shal (1) examine
the role of smal businesses in the international economy and (2) represent the views and interests
of smal businesses before foreign governments and international entities to contribute to
regulatory and trade initiatives that may affect smal businesses.
In addition, S. 83, the Advocacy Empowerment Act of 2019, would, among other provisions,
have authorized Advocacy to issue, modify, or amend rules governing federal agency compliance
with the RFA.59 Also, as mentioned, H.R. 6454, the Smal Business Advocacy Improvements Act
of 2022, would specifical y authorize the Office of Advocacy to represent smal business views

57 SBA, FY2022 Congressional Budget Justification and FY2020 Annual Report, p. 188. T he Office of Advocacy’s
regional advocates participated in 607 outreach events in FY20 13, 536 in FY2014, 550 in FY2015, 509 in FY2016, 141
in FY2017, 523 in FY2018, and 852 in FY2019. T he Office of Advocacy’s regional advocates participated in fewer
outreach events in FY2017 than in previous years because they are reappointed with each new Administration and all
positions became vacant in January 2017. Although some regional advocates were reappointed during FY2017, others
were not. A full team was not in place by the end of the year.
58 SBA, FY2022 Congressional Budget Justification and FY2020 Annual Report, p. 188. Advocacy’s economists made
34 presentations to academic, media, and other small business policy -related audiences in FY2015, 52 in FY2016, 28 in
FY2017, 18 in FY2018, and 22 in FY2019.
59 See U.S. Congress, Senate Committee on Small Business and Entrepreneurship and the Subcommittee on Regulatory
Affairs and Federal Management, Committee on Homeland Security and Governmental Affairs, Reauthorization of the
SBA Office of Advocacy, joint hearing, 116th Cong., 1st sess., May 22, 2019, S. Hrg. 116-86 (Washington: GPO, 2019),
p. 97.
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and interests before foreign governments and other international entities concerning regulatory
and trade initiatives that may affect smal businesses.
Arguments for Expanding Advocacy’s Regulatory Authority
Advocates of expanding 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 smal entities, thereby enhancing job creation and hastening
economic recovery.”60 They argue that
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.61
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.62
Arguments Against Expanding Advocacy’s Regulatory Authority
Opponents of expanding 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-smal business rhetoric, which wil erect significant barriers to rulemaking that wil hinder

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. 2.
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),
pp. 7-8; and U.S. Congress, House Committee on the Judiciary, Sm all Business Regulatory Flexibility Im provem ents
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.
62 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, Sm all Business Regulatory Flexibility Im provem ents 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 Term s
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 Term s 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 Im provem ents, 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 Elem ents of the Act to Im prove Its Effectiveness, GAO-06-998T , July 20, 2006, pp. 1, 4-10, at
http://www.gao.gov/assets/120/114481.pdf.
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the promulgation of critical public health and safety protections.”63 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.64
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.65
Concluding Observations
The SBA’s Office of Advocacy is a relatively smal office with a relatively large mandate—to
represent the interests of smal business in the regulatory process, produce and promote smal
business economic research, and facilitate smal business outreach across the federal government.
It faces several chal enges.
First, Advocacy is general y 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
(nearly 10,000 full-time equivalent (FTE) employees and a FY2021 budget of nearly $326
bil ion) relative to Advocacy which, given their statutorily overlapping missions as advocates for
smal businesses, makes it more difficult than would otherwise be the case for stakeholders to
recognize Advocacy as the definitive voice for smal businesses.
Second, Chief Counsels tend to have relatively short tenures (three years, eight years, one year,
seven years, six years, four years, and one year). When they leave office, there have often been
delays in naming a successor, creating continuity problems for Advocacy. For example, the
position was fil ed on an interim basis by Claudia Rodgers, a long-time Advocacy senior staff
member, from January 2015 (following Winslow Sargeant’s departure) until Darryl L. DePriest’s
Senate confirmation on December 10, 2015. DePriest left office in January 2017. Major L. Clark,
III, previously Assistant Chief Counsel for Procurement Policy for Advocacy, is currently fil ing

63 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.
64 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. 57.
65 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), pp. 74, 75.
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the Chief Counsel’s position on an interim basis.66 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 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 Advocacy’s role under the RFA. The lack of clarity concerning these key
terms makes it difficult for Advocacy to objectively determine agency compliance with the RFA
and also makes it more difficult for Advocacy to train 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 al ow federal agencies to
“determine what is significant to their programs and particular constituencies.”67
Fourth, Advocacy is subject to criticism from those who believe that it should be more aggressive
in preventing federal regulations (i.e., from those who general y oppose federal regulations,
especial y 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 general y view federal
regulations favorably, especial y in addressing environmental and workplace safety issues).68
Thus, 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.
Final y, Advocacy’s relatively limited budget restricts its ability to produce and promote
economic research on smal businesses and to engage in outreach activities, particularly outreach
activities not directly related to its RFA role. It could be argued that Advocacy does not need
additional resources for these endeavors because the SBA engages in these same activities. Once
again, this reflects the chal enges the Office of Advocacy faces as an independent office operating
within a much larger federal agency with an overlapping mission.

66 President T rump nominated David C. T ryon to be the next Chief Counsel on September 29, 2017. T he Senate
Committee on Small Business and Entrepreneurship held a hearing on his nominatio n on February 14, 2018. T he
hearing can be viewed at https://www.sbc.senate.gov/public/index.cfm/hearings?ID=C476277C-BE34-4FA6-B8D8-
D445AB2EE120.
67 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. 3 0.
68 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 https://www.sba.gov/content/response-letter-dated-041111-honorable-olympia-j-snowe-1; U.S. Congress,
House Committee on the Judiciary, Regulatory Flexibility Im provem ents 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?” T he Center for Effective Government, Washington, DC, at http://www.foreffectivegov.org/
office-of-advocacy-report.
Congressional Research Service

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

Author Information

Robert Jay Dilger

Senior Specialist in American National Government

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Congressional Research Service
R43625 · VERSION 34 · UPDATED
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