Site Visit: Some Federal Regulations are Just Plain Nutty

ByOffice of Advocacy

Site Visit: Some Federal Regulations are Just Plain Nutty

?By Nick Ivory, Regional Legislative and Regulatory Manager

Advocacy visited Flory Industries, a small, third generation, family-owned business located in Salida, Calif., that offers products world-wide for harvesting tree nuts like almonds, cashews, chestnuts, figs, hazelnuts, macadamia, pecans, and walnuts. Established in 1936, the company employs roughly 300 people and produces nut-harvesting equipment, flail mowers, vineyard equipment, and much more. According to Flory Industries, they have the largest market share of what they produce. Advocacy toured their manufacturing plant with a handful of their staff as they detailed federal regulatory rules that have been driving them nuts.

Flory Industries took particular aim at the Clean Air Act (CAA), enforced through Environmental Protection Agency regulations, as being the most burdensome. The company manufactures roughly 95 percent of their primary machines, only outsourcing the engine and hydraulics. When the CAA passed, Flory was hit with a whopping 100 percent increase on the price of the engines that they purchase. Advocacy has found that all too often, agencies fail take into account the skyrocketing cost of equipment and components as a result of some of the rules that they write and how this puts small businesses at a stark disadvantage in relation to their larger competitors.

Another CAA rule that has negatively impacted Flory Industries is one that limits the amount of volatile organic compound (VOC) emissions. Major sources of man-made VOCs are coatings, especially paints and protective coatings. The rule establishes a limit on the amount of pounds of these substances that can be used on both a per-day and per-month basis in a manufacturing or production process. In regards to the paint used by Flory, they were under the amount per-month but over the amount per-day, and were therefore found in violation of the rule. This resulted in their having to find a new type of paint that would provide a good quality coat for their finished products, while at the same time complying with the rule; however, they were not given enough time to find the right paint that would satisfy both needs. This resulted in the paint falling off after the drying process, which hindered their overall productivity until they finally found the right paint to use. The EPA should have been more assistive in the compliance process and allowed them the breathing room needed to comply with the rule. Advocacy regularly hears complaints from small business stakeholders that agencies are overly-punitive on regulatory compliance, and is working with agencies to change that mindset.

Advocacy was in Modesto, Sacramento and Santa Clarita, Calif. for Regional Regulatory Reform Roundtable meetings April 30-May 3.

Can’t get to a roundtable near you? Fill out this form and tell us about your federal regulatory burdens. We will pass this information on to the appropriate agency and use it in the planning of upcoming Regional Regulatory Reform Roundtables.

Nick Ivory is the Regional Legislative and Regulatory Manager. Ivory can be reached at nicholas.ivory@sba.gov.

About the author

Office of Advocacy editor

Created by Congress in 1976, the Office of Advocacy of the U.S. Small Business Administration (SBA) is an independent voice for small business within the federal government.