Prove It Act of 2025
- Sponsor
- Sen. Ernst, Joni [R-IA]
- Committees
- Homeland Security and Governmental Affairs Committee (primary), Small Business and Entrepreneurship Committee
- Last action
- Nov 19, 2025
Bottom line
This bill aims to enhance small business input and oversight in federal rulemaking by expanding cost analysis requirements and creating new review mechanisms for regulatory impact certifications.
What it actually does
This bill amends Chapter 6 of title 5, U.S. Code (the Regulatory Flexibility Act) to increase transparency and accountability for federal agencies when making regulatory decisions that impact small businesses. It expands the scope of initial regulatory flexibility analyses to include indirect costs, establishes a petition process for small entities to challenge agency certifications of no significant economic impact, and requires agencies to publish guidance documents for rules impacting small entities. It also mandates consequences for agencies failing to conduct periodic reviews of rules.
Proponents argue
Supporters argue the bill will reduce the regulatory burden on small businesses by forcing agencies to more thoroughly consider and disclose the direct and indirect economic impacts of proposed rules. They contend it provides small entities with a crucial mechanism to challenge inadequate agency assessments and ensures greater transparency in regulatory guidance, ultimately fostering a more predictable and less burdensome regulatory environment for small businesses.
Opponents contend
Critics might argue that the bill could significantly slow down the rulemaking process, adding new procedural hurdles and potential litigation risks for agencies. They may contend that expanding the scope of indirect costs and creating a petition-and-review process could be overly burdensome for agencies, potentially delaying or preventing necessary regulations from being implemented, and that existing mechanisms already provide sufficient small business input.
The bill is relatively short and its provisions are clearly laid out, making it accessible for an informed reader to understand its core changes within a reasonable timeframe.
Section 2(a)(1), amending 5 U.S.C. 603(b)
Indirect Cost Consideration in Initial Regulatory Flexibility Analysis
This provision requires federal agencies, when conducting an initial regulatory flexibility analysis for a proposed rule, to consider reasonably foreseeable potential indirect costs on small entities. These indirect costs include those affecting small businesses that interact with directly regulated entities, are regulated by other governmental entities due to the rule, or are subject to other agency rules as a result of the proposed rule.
Supporters argue
Supporters argue this ensures a more comprehensive and realistic assessment of a rule's economic impact on small businesses, preventing hidden costs from disproportionately affecting them.
Critics contend
Critics might argue that defining and quantifying "reasonably foreseeable potential indirect costs" could be highly subjective, resource-intensive for agencies, and prone to overestimation, potentially leading to unnecessary delays or weakening of beneficial regulations.
Tradeoffs
This provision balances the desire for comprehensive cost assessment against the practical challenges and resource demands of quantifying complex indirect economic effects.
Section 2(a)(3), inserting new 5 U.S.C. 605A
Small Entity Petition and Review Process for Regulatory Certifications
This section creates a formal process for small entities to petition the Chief Counsel for Advocacy of the Small Business Administration (SBA) to review an agency's certification that a proposed rule will not have a significant economic impact on a substantial number of small entities. The Chief Counsel conducts a prima facie review, and if merited, a full review, including a meeting with the agency and the Office of Information and Regulatory Affairs (OIRA). If the Chief Counsel determines the rule will have a significant impact, the agency must then perform full regulatory flexibility analyses.
Section 2(a)(3), new 5 U.S.C. 605A(d)(4)
Penalty for Agency Non-Cooperation in Full Review
If a federal agency fails to attend the required meeting or otherwise fails to assist the Chief Counsel for Advocacy during a full review of a certification, the final rule in question shall not apply to small entities. This provides a strong incentive for agency cooperation with the review process.
Section 2(a)(3), new 5 U.S.C. 605A(d)(5)
Judicial Review of Agency Certifications
This provision clarifies that an agency's certification under 5 U.S.C. 605(b) (that a rule will not have a significant economic impact on small entities), when a petition for review has been filed, is considered a final agency action for purposes of judicial review. This means the certification can be challenged in court after the Chief Counsel's review is complete.
Section 3, amending 5 U.S.C. 609
Transparency and Feedback for Regulatory Guidance
For any rule determined to have a significant economic impact on a substantial number of small entities, the head of the agency must publish all guidance documents and other relevant interpretive documents on regulations.gov or a similar website. Furthermore, the agency must allow for public comments on these documents, enabling small entities to provide feedback on how the rules are being interpreted and applied.
Section 4(a)(2), adding new 5 U.S.C. 610(d)
Consequences for Failing to Conduct Periodic Review of Rules
If an agency fails to conduct the required 10-year periodic review of a rule, the Chief Counsel for Advocacy of the SBA must notify the agency that the rule has ceased to be effective. The agency must then publish this notification in the Federal Register, solicit comments on reinstatement, and if it decides to reinstate, must complete the review within 180 days. Upon completion, the rule is reinstated without needing new notice and comment rulemaking.
The amendment regarding consequences for failing to conduct periodic review (new 5 U.S.C. 610(d)) applies to any final rule issued by an agency during the 5-year period preceding the date of enactment of this Act, or on or after the date of enactment.
Section 4(b)
Why it matters:This is standard legislative practice for specifying the effective date and scope of an amendment, rather than an attempt to obscure the provision.
Case for: Supporters would argue this ensures that the new accountability measures for periodic review apply broadly, including to recently enacted rules, preventing agencies from simply ignoring the new requirements for existing regulations.
Case against: Critics might argue that applying the sunset provision retroactively (to rules from the preceding 5 years) could create immediate administrative burdens for agencies to review a backlog of rules, potentially leading to a wave of rules ceasing to be effective due to insufficient time for compliance.
Estimated impact: Potentially impacts a large number of existing rules, requiring agencies to prioritize reviews for rules issued in the last 5 years.