Using the Regulatory Flexibility Act (RFA) as its platform, Regional Aviation Partners (RAP), is calling on FAA to reconsider the impact of some of its past rulemaking on small businesses and communities something they failed to do, ignoring a mandate. One of the targeted rules to be reconsidered is the commuter safety rule, which forced many regionals to abandon small communities as complying with the rule raised costs so much that even unsubsidized markets were shed. The impact of these rules was reported in detail in a five-part series in Regional Aviation News.
‘This provision would allow RAP or its member constituents to request the FAA review all of the impacts of the Commuter Safety Rule and other rule changes, taking into consideration not only the costs and hardships caused to carriers but also the economic impact it has had on small communities through the loss or deterioration of commercial air service and cost to comply with FAR Part 139 (ARFF) requirements,” said RAP. Agencies also failed to heed an RFA requirement calling on them to not only quantify the impact of regulations on small entities but consider alternatives that minimize regulatory impact while still achieving policy goals, said RAP. The original 1980 RFA was later strengthened in 1996 and again re-emphasized in President Bush’s Small Business Agenda, which required agencies to work more closely with small organizations or governments.
RAP reported that the General Accountability Office is currently looking into compliance to the RFA requirements that federal agencies periodically review existing regulations with a major impact on a lot of small entities, according to RAP. The purpose is to determine whether the rules should be continued without change or should be amended or rescinded. While it is unlikely the commuter safety rule will be eliminated, it could be amended especially since both DOT and the GAO have recommended better matching capacity at small communities to aircraft, which would mean a return to the Part 135 regulations, shed in the fervor to provide a single level of safety. As reported in the RAN series, however, it did not achieve the safety goals. In fact, the regional airline industry met or exceeded the safety of their major-carrier counterparts long before a single level of safety was even proposed. Related Story
RAP is also looking into provisions of Section 553 (e) of the Administrative Procedure Act (APA) granting certain rights to those seeking relief from agency rules. Thus a person requesting the FAA review all of the economic impacts of the Commuter Safety Rule under the APA may seek judicial review should the agency not comply with the statute, said RAP.
“Over the years, the RFA has proven to be invaluable as it provides checks and balances against burdensome and overreaching federal regulations which could otherwise adversely affect small businesses and small communities,” said RAP in a legislative update. “For example, the Small Business Administration (SBA) stated in their July 20, 2006 testimony before the House Subcommittee on Commercial and Administrative Law that Small Business Administration’s (SBA) Office of Advocacy’s efforts to educate federal agencies on how to properly assess the impacts of their regulations on small entities resulted in $6.6 billion in small business cost savings for Fiscal Year 2005 and total savings of $71 billion during the course of this Administration. Conversely, the SBA also reports that federal agencies continue to overlook all of the effects their regulations would have on small entities by taking into consideration only direct costs, thereby disregarding the indirect costs of regulations. In the last session of Congress (109th), law makers took notice of federal agency tactics to avoid consideration of indirect economic impacts during the rulemaking process. Senator Olympia Snowe (R-ME) introduced S. 1388 which specifically required agencies account for indirect costs. Unfortunately, the bill was not passed.” RAP intends to pursue reintroduction with Senator Snowe.
In the meantime, RAP is questioning whether FAA complied with the statute, and, if not, what recourse it has. RAP is analyzing the RFA with respect to the Commuter Rule, saying, “FAA did not adequately consider the direct impact of the rule on air carriers, severely underestimating the compliance costs to airlines and the [significant abandonment] of small markets across the country by those carriers using 10- to 30-seat aircraft. Furthermore, the FAA did not consider any of the economic impacts of the rule on small communities which, while not explicitly required under the RFA, was the intent of Congress, according to the SBA. As a result, the Commuter Safety Rule was approved [without adequate FAA analysis and community input], leading to a decline in the number of carriers serving small communities and erosion of its passenger base. Furthermore, small communities now must pay substantial amounts of money to comply with FAR Part 139 (ARFF) requirements where RFA analysis was once again not a factor in the application of the rule.”
It said it will demonstrate “how the FAA failed to comply with the intent of the law when it avoided any consideration of the indirect economic costs to small communities, including: increased annual subsidy rates, elimination of commercial air service due to the $200 per passenger subsidy cap, Part 139 (ARFF) compliance costs when formulating and making final the Commuter Safety Initiative and other rule changes. Furthermore, while the FAA did assess the direct impact on economic costs of the rule, we will show how the agency underestimated the costs and the detrimental consequences the rule would have on carriers and small community air service.”