Zero-Cost Regulatory Budget for SBA Paired with $1,000 Direct Payments, Funded by $1 Trillion Treasury Transfer

This bill, the Small Business Regulatory Reduction Act of 2025, is essentially two completely different pieces of legislation duct-taped together. The first part focuses on regulatory costs for small businesses, and the second part is a massive, one-time direct payment program for individuals.

The Zero-Cost Rule for Small Business

Section 2 aims to put the brakes on regulatory costs for small businesses, starting with the Small Business Administration (SBA) itself. It mandates that for fiscal year 2026 and every year after, the SBA’s “small business regulatory budget” must be “not greater than zero.” What does that mean in plain English? It means the SBA cannot issue any new rule that imposes a net cost on small businesses. If the SBA wants to issue a new rule that costs small businesses money—say, a new reporting requirement or a safety standard—it must simultaneously repeal or modify an existing rule that saves small businesses an equal or greater amount of money.

This is a big deal for small businesses, like your local bakery or independent mechanic. It guarantees that at least one federal agency, the SBA, won't be adding to their compliance burden. However, it also means the SBA might be severely limited in passing necessary updates or safeguards if they come with a price tag. For instance, updating loan application rules to prevent fraud might be deemed too costly, forcing the agency to choose between necessary oversight and the zero-cost mandate.

Tracking the Regulatory Tab

While the SBA is forced to stick to a zero-cost budget for its own rules, the bill also mandates transparency for everyone else. Starting 60 days after the end of fiscal year 2025, the SBA Office of Advocacy must submit an annual report to Congress detailing the total regulatory costs imposed on small businesses by every other federal agency—think the EPA, OSHA, the IRS, etc. This report must break down the total cost and list every rule issued in the previous year that impacts small businesses (Sec. 2). For the average small business owner, this won’t change their day-to-day compliance, but it will finally give Congress a clear, agency-by-agency accounting of the cumulative regulatory burden they face. It’s essentially shining a massive spotlight on who is costing small businesses the most.

The $1,000 Surprise Payment

Now for the completely separate—and much larger—part of the bill: Section 3 establishes a one-time $1,000 payment for eligible individuals. To qualify, you must be a U.S. citizen or a “qualified alien” and either be over 18 with a valid Social Security number, or under 18 but claimed as a dependent on an eligible individual’s tax return. The Treasury Department is directed to make these payments as fast as possible, but no later than 120 days after the bill is enacted.

Crucially, this payment is designed to be truly helpful: it is not counted as income for any federal, state, or local program, meaning it won't jeopardize your eligibility for things like food assistance or housing aid. It’s also protected from garnishment or levy (Sec. 3). For a family of four, this could mean an immediate, tax-free $4,000 injection of cash, which could be a huge help with rising grocery bills or catching up on rent.

The Trillion-Dollar Question

How is this payment funded? This is where the bill takes a sharp turn. The program is funded by a massive, one-time transfer of $1,000,000,000,000 (that’s one trillion dollars) from the general fund of the Treasury into a special account. The bill explicitly states that “No additional funds are authorized to be appropriated” to carry out this Act (Sec. 3). This means the program is designed to be a one-shot deal, relying entirely on this initial transfer. This massive withdrawal from the general fund—the government’s main checking account—is a significant immediate fiscal event, taking a trillion dollars that was slated for other uses and dedicating it solely to these payments. It’s a huge economic commitment, and because no future funding is authorized, the program will simply run out of money once the $1 trillion is exhausted.