Substitute Senate Bill No. 1402, also known as Public Act No. 25-109, modifies the regulatory flexibility analysis that agencies must conduct when proposing regulations that may affect small businesses. The bill repeals subsection (b) of section 4-168a of the general statutes and replaces it with new requirements effective July 1, 2025. Agencies are now required to prepare a regulatory flexibility analysis that identifies the scope and objectives of the proposed regulation, the types and total number of small businesses potentially affected, and the compliance burdens that may be imposed on these businesses. Notably, the analysis must now include considerations for additional recordkeeping, employee benefits, and modifications to products or packaging, among other compliance requirements.

The bill also emphasizes the importance of communication between agencies and small businesses during the development of regulations. It mandates that agencies assess whether the proposed regulations offer alternative compliance methods that minimize adverse impacts on small businesses while still achieving statutory objectives. These alternatives may include less stringent compliance requirements, simplified reporting processes, and potential exemptions for small businesses. Overall, the legislation aims to enhance the regulatory process by ensuring that the unique challenges faced by small businesses are taken into account.