Prove It Act
Latest Action
Placed on the Union Calendar, Calendar No. 552.
Official Summary
Prove It Act of 2025 This bill expands the requirements for federal agency rulemaking with respect to small businesses, organizations, and governmental jurisdictions. Specifically, when conducting an initial regulatory flexibility analysis, agencies must include, where feasible, any reasonably foreseeable indirect costs the proposed rule may impose on small entities. Further, if an agency certifies that an initial regulatory flexibility analysis is not required because the rule will not have a significant economic impact on a substantial number of small entities, the agency must provide such certification within 10 days to the Office of Advocacy of the Small Business Administration. A small entity or group of small entities may petition the Office of Advocacy to review such certification. The petition must include specified information, such as the issues the petitioner believes should be addressed and a proposed solution to the issues raised. If the Office of Advocacy ultimately determines, upon a full review of the petition, that the proposed rule would have a significant economic impact on a substantial number of small entities, the agency promulgating the rule must perform an initial and final regulatory flexibility analysis for the rule. Additionally, if the agency does not participate or assist in the full review process, the finalized rule shall not apply to small entities. The bill also requires agencies to publish, and allow for comments on, all guidance documents with respect to any rule an agency determines is likely to have a significant economic impact on a substantial number of small entities.
GovScope Watchdog™
AI Government Intelligence™The Prove It Act of 2025 aims to enhance federal agency rulemaking transparency and accountability regarding the economic impact of regulations on small businesses, organizations, and governmental jurisdictions. It requires agencies to include reasonably foreseeable indirect costs in initial regulatory flexibility analyses when feasible. Agencies must also submit certifications to the Small Business Administration's Office of Advocacy if they determine a rule will not significantly impact small entities, allowing small entities to petition for review. If the Office of Advocacy finds a significant impact, agencies must conduct full regulatory flexibility analyses, and failure to participate in the review process means the rule will not apply to small entities. Additionally, agencies must publish and allow public comments on guidance documents related to rules likely to have significant economic impacts on small entities.
This bill strengthens procedural requirements for federal agencies to assess and disclose the economic impact of regulations on small entities, providing a formal mechanism for review and public input.
- Agencies must include reasonably foreseeable indirect costs on small entities in initial regulatory flexibility analyses when feasible.
- Certifications that no significant economic impact exists must be submitted to the SBA Office of Advocacy within 10 days.
- Small entities can petition the Office of Advocacy to review agency certifications, potentially triggering full regulatory flexibility analyses.
- If agencies do not participate in the Office of Advocacy's review, the finalized rule will not apply to small entities.
- Agencies must publish and allow comments on guidance documents for rules likely to significantly impact small entities economically.
['Small businesses, small organizations, and small governmental jurisdictions potentially affected by federal regulations', 'Office of Advocacy of the Small Business Administration', 'Federal agencies responsible for rulemaking']
['Increased administrative burden and costs for federal agencies to conduct more detailed analyses and participate in review processes', 'Potential delays in rulemaking due to additional certification and petition review requirements', "Challenges in defining and assessing 'reasonably foreseeable indirect costs' and 'significant economic impact' consistently", "Possible legal and procedural complexities if agencies fail to participate in the Office of Advocacy's review, affecting rule applicability"]
The bill was introduced in the 119th Congress and is currently in process, having been placed on the Union Calendar. It addresses ongoing concerns about the economic impact of federal regulations on small entities and seeks to increase transparency and accountability in the regulatory process, particularly regarding the Small Business Administration's role in advocacy and review.
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['Enhanced scrutiny of economic impacts on small entities may encourage agencies to design regulations with reduced burdens on small businesses and organizations.', 'Increased transparency and public comment opportunities on guidance documents could improve stakeholder engagement and regulatory clarity.', 'Potential for increased litigation or administrative challenges if agencies fail to comply with new procedural requirements.']
The bill introduces new procedural requirements that increase transparency and oversight of federal rulemaking affecting small entities, particularly through the Office of Advocacy's role. Monitoring agency compliance with certification submissions and participation in reviews will be critical. The requirement that rules not apply to small entities if agencies do not participate in reviews creates a novel enforcement mechanism that warrants close observation for its practical impact on regulatory processes.
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