Government overreach has become so common lately that people are becoming desensitized to its persistence. Not only are our personal liberties rapidly eroding, but the small business owners and those they employ have felt the effects of an overreaching government.
Over regulation has become a huge problem in the daily operations of small businesses throughout Montana. More frequently, large corporations use the rulemaking process to restrict competition in the marketplace. The additional costs of overregulation can be easily absorbed by large businesses, but small businesses – the economic driver of Montana’s economy — are priced out.
A recent study shows small businesses around the country spend an average of $7,647 each year per employee just to comply with government regulations and mandates. This is a significantly larger sum than what larger businesses pay, which average around $5,282 per year.
For many small businesses the cost to comply can simply run them out of operation. At the very least, it hurts the employees by decreasing the funds allotted for salaries and benefits. While certain regulations are necessary and even beneficial to the function of good business, some regulations imposed by overzealous government bureaucrats have caused our economy to stagnate.
Even President Barack Obama, who is staunchly supportive of more government intervention and regulation, agrees. In January 2011, at a time when our nation’s economy was struggling to shake the effects of the Great Recession, President Obama issued a Presidential Memorandum calling for regulatory flexibility in order to grow small business and create jobs.
He wrote at the time, “My administration is firmly committed to eliminating excessive and unjustified burdens on small businesses. … Accordingly, I hereby direct executive departments and agencies, when initiating rulemaking that will have significant economic impact on substantial numbers of small entities, to give serious consideration to whether and how it is appropriate, consistent with law and regulatory objectives, to reduce regulatory burdens on small businesses, through increased flexibility.”
At this time during the 2011 legislative session, I introduced SB 201, a bill that would require Montana state agencies to do exactly this: consider the impacts the rulemaking processes has on small businesses in our states. It was hardly a novel concept since 42 other states have required similar considerations. The bill sailed through both the Senate and House with bipartisan support. But, alas, SB 201 and small businesses throughout Montana felt the veto fate of the cruel, red hot branding iron.
Not to be outdone, I decided to try again in 2013 with SB 139. This bill, like its early counterpart, creates an affirmative duty for state agencies to analyze the impacts to small business before passing new rules and regulations. This will not only inform decision makers about the actual adverse and positive effects of the regulation, but it would also create a record upon which small businesses could pursue legal remedy. Protecting small businesses from an over reaching government is paramount in creating jobs and growing Montana’s economy.
Opponents fear that SB 139 would allow businesses to ignore government regulations and not abide by environment or labor laws. This is simply not the case. Small businesses are fully willing to comply with regulations, but want to ensure that they are playing on a level playing field. The act only requires agencies to consider the consequences of their regulations before automatically imposing regulations.
Opponents also contend that SB 139 would require state agencies to spend additional time and funds to study the effects of the rules and regulations. Perhaps this is true, but it is a worthy investment to ensure that small businesses are being treated fairly and ensure their growth is not stunted by harsh regulations. SB 139 will require additional transparency and accountability in government agencies.
SB 139 has passed the Senate and is building momentum as it works its way through the House. Let’s hope that when it reaches Gov. [Steve] Bullock’s desk that he will stand with Montana’s job creators and sign the bill into law.
Sen. Ed Walker