Legislators Plan Field Hearings on Regulatory Reform

Legislators Plan Field Hearings on Regulatory Reform

Business groups presented a litany of complaints and suggestions – and a few compliments about the government rules they must navigate to operate in Ohio as the newly formed Regulatory Reform Task Force convened its first meeting.

Senate President Bill Harris (R-Ashland) and House Speaker Jon Husted (R-Kettering) created the six-member legislative task force to tackle the perception that Ohio’s regulatory environment is more cumbersome than other states, making it less able to compete for business investment. Gov. Ted Strickland has taken a similar course, issuing an executive order calling for “common sense” business regulation.

Sen. Keith Faber (R-Celina), chairman of the task force, said future meetings would take place across the state, with the first tentatively scheduled for 10 a.m. on Sept. 3 in the Cincinnati-Dayton area, at a location to be determined. Faber said the field hearings will end with a final, wrap-up hearing in Columbus, after which legislators will issue a report to the leadership.

In addition to Faber, the committee includes Rep. James Zehringer (R-Fort Recovery), who serves as the vice chairman, Rep. Jay Goyal (D-Mansfield), and Sens. Tom Niehaus (R-New Richmond) and Capri Cafaro (D-Hubbard). Cafaro was absent Wednesday because of a scheduling conflict.

Faber opened the meeting by saying that, while the task force’s intent is to find ways to make business regulation less onerous, he doesn’t want it to come at the expense of the health and safety assurances those regulations provide.

“Let me begin by making is clear – this process is about making sure we have clean air, clear water and healthy, clean work environments,” Faber said.

First to testify was William Hills, executive director of the Joint Committee on Agency Rule Review, a clearinghouse for state regulations. Hills said the committee takes up about 10,000 to 12,000 actions on rules every year.

Faber and Zehringer pointed out that, while JCARR requires agencies writing rules to include an analysis of the cost of the rules to state government, it does not require an analysis of the cost to business.

Brian Barker, of the Ohio Aggregates and Industrial Minerals Association, said his industry, which provides basic construction materials, is regulated by numerous agencies, including the Ohio Environmental Protection Agency, U.S. EPA, Ohio Department of Natural Resources, U.S. Army Corps of Engineers and Homeland Security. Barker singled out for praise Sean Logan, director of ODNR, who he said was very accessible and willing to have face-to-face meetings.

But, he said, environmental regulations still mean most mining companies have at least one full-time environmental compliance staffer and often employ outside consultants as well.

“It used to be said that making big rocks into small rocks was the hardest part of the job,” Barker said. “Now, making small rocks is the easy part, with regulatory compliance the difficult part.”

Justin Mohler, of the Ohio Society of Certified Public Accountants, talked about the confusion created by disparate municipal income tax structures, the Bureau of Workers Compensation compliance and rating system, and the various steps needed to register a business.

Zehringer noted that other states practically offer to fill out the paperwork for business owners.

Mohler said if someone sets up a corporation in Ohio but never activates it, they wouldn’t need to file a federal tax return on it but would need to file a franchise tax return. If someone fails to do so, he “typically has to file and pay the tax and large penalties for several years to get the corporation reinstated only to have it dissolved.

Rocky Black, of the Ohio Farm Bureau, pointed out that some positive reforms can be “attitude-driven.” Specifically, he mentioned the Ohio Department of Transportation, which he said has typically feuded with farmers over eminent domain but which recently has seemed more helpful, particularly in using a common sense approach to address an issue of moving farm equipment through town in the Norwalk area.

Three other witnesses – Kyle Jackson of the Ohio chapter of the Nation Federation of Independent Businesses, Carrie Haughawout of the Ohio Small Business Council and Christiane Monica of the U.S. Small Business Administration Office of Advocacy – talked about the disproportionately high cost small businesses pay per employee for regulatory compliance.

Monica said her office’s research show that businesses with fewer than 20 employees pay $7,647 per employee for federal regulatory compliance, while businesses with 500 or more employees pay about $5,282 per employee.

Story originally published in The Hannah Report on August 13, 2008. Copyright 2008 Hannah News Service, Inc.