Paul Garritano & Lindsay Lockwood 
State Regulation of Small Business 
Impact of Regulatory Flexibility

The Regulatory Flexibility Act of 1980 established a process of analyzing and mitigating impacts of federal regulations on small businesses and other small entities. In the ensuing years, states began adopting regulatory flexibility legislation (or executive orders) of their own. In 2002 the SBA Office of Advocacy launched a Model Legislation Initiative utilizing a model state regulatory flexibility bill, which incorporated many elements of the federal legislation in simplified form. The model legislation was published for general use in 2005, along with supporting commentary and materials, and a guidance document to assist states in implementing regulatory flexibility legislation was published in 2007. About half the states adopted regulatory flexibility legislation in the period 2002 – 2007. By the end of this period, the SBA data showed that 45 states and territories had some form of regulatory flexibility legislation or executive order, and about 20 of those included all of the elements in the model legislation. SBA’s Model Legislation Initiative wound down at the end of the Bush administration, although progress continued at the state level. This book examines regulatory flexibility at the state level with two general purposes: to assess the implementation of state regulatory flexibility laws; and to document further developments of state regulatory flexibility programs. The book draws on available public documents and examines the legislation of each state and traces the rule-making process from notice through regulatory flexibility analysis and review.