Week 2 Assignment – GM520
1) The administrative agency which I choose is the Small Business Administration (SBA). The reason why this agency and the proposed regulation interest me is because I have worked for the Social Security Corporation in the businesses development department where I worked on micro projects and small businesses. The way this regulation that has been proposed may affect me is by enhancing my experience in small businesses.
2) The proposed rule made by the Small Business Administration is on the size standards of small businesses of some 35 industries of the North American Industry Classification System, NAICS, and other services. The regulation proposes an increase in the size standard of the relevant small businesses. The regulation ...view middle of the document...
The agency has to show evidence that supports their proposal and they must explain this evidence to prove the rational connection between the facts found and the choice made. Other than that, the proposal could be challenged as arbitrary, capricious, and abusive of discretion.
2- Substantial evidence test, this theory requires detailed evidence that would demonstrate the importance of proposal, and this evidence has to be factual and convincing.
3- Rule that proposed did not comply with APA requirements of notice, publication, and public comment or input. There are some process the rule makers has to follow it, so the rule can be challenged if the proposal missed one of those process.
4- Ultra vires, this theory means that the regulation goes beyond the powers which are granted to the agency. If I want to challenge the proposal I have to show the agency’s authority and prove that the proposal exceeds this authority, and this proposal could lead to change in the essence of the regulation.
5- The 90-day moratorium on all new regulations since 1992. During this period, regulators are not permitted to promulgate new regulations.
(c) I would challenge this rule by using the Arbitrary and capricious theory. I think the agency did not show objective evidence which supports their proposal, or any convincing reasons for the distribution of the size standards to eight levels. I think this proposal is arbitrary, and volatile, and could make a negative effect on small investors, because expanding the size standards of small businesses will include new, bigger investors who have more financial power. This matter will create an unfair competitive environment.
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