A. Regulatory Flexibility Act

    The Regulatory Flexibility Act of 1980 (5 U.S.C. 601 et seq.) requires agencies to evaluate the potential effects of their proposed and final rules on small businesses, small organizations and small governmental jurisdictions. The agency does not believe that any of the tire manufacturers are small businesses.

    However, there are thousands of small tire retail outlets that will in some small way be impacted by this rule. As mentioned earlier, increasing the price of the least expensive tires could potentially allow used tires and retread tires to make more inroads into the tire business. This could impact small businesses. At this time, it is unknown whether the impacts will be insignificant and just an increase in price to customers, or whether there will be some competitive effects brought about by the price increase.

    B. Unfunded Mandates Reform Act

    The Unfunded Mandates Reform Act of 1995 (Public Law 104-4) requires agencies to prepare a written assessment of the costs, benefits, and other effects of proposed or final rules that include a Federal mandate likely to result in the expenditures by State, local or tribal governments, in the aggregate, or by the private sector, of more than $100 million annually (adjusted annually for inflation with base year of 1995). Adjusting this amount by the implicit gross domestic product price deflator for the year 2000 results in $109 million (106.99/98.11 = 1.09). The assessment may be included in conjunction with other assessments, as it is here.

    This proposal is not estimated to result in expenditures by State, local or tribal governments of more than $109 million annually. However, it is likely to result in the expenditure by automobile manufacturers and/or their tire suppliers of more than $109 million annually. The estimated annual cost is $282 million.

    These effects have been discussed in this Preliminary Economic Assessment, see for example the chapter on Costs.