Glenn Hamer, president and CEO of the Arizona Chamber of Commerce and Industry, and Farrell Quinlan, Arizona state director of the National Federation of Independent Business, were interviewed regarding the state of government regulations in general and specifically in Arizona. Here are their responses to a series of questions.
How do government regulations help economic development?
HAMER: A commonsense, transparent regulatory environment provides clear and predictable rules of the road for doing business for everyone.
How do some government regulations help small, independent businesses?
QUINLAN: Regulations can be benign or even positive as long as they avoid becoming a sword wielded against competition or a shield deployed to obscure cronyism. Regulations can and many times do help define the level playing field for all businesses, small and large, so a truly free market can operate for the benefit of producers and consumers.
How can government regulations hurt business expansion?
HAMER: As the regulatory burden grows, so do costs. Businesses facing new fees at every turn are really being saddled with backdoor tax increases, especially if these fees are redirected into the state general fund to help with budget shortfalls and not used for the purpose for which they were collected. A burdensome regulatory environment harms the state’s competitive standing and ability to attract jobs.
What type of proposed regulations does the NFIB keep an eye on at the Legislature?
QUINLAN: NFIB is very encouraged by the election of Doug Ducey as Arizona’s next governor. As someone who has firsthand experience of the regulatory travails of small-business owners, we are excited about how Governor Ducey will build on the strong foundation laid by Governor Brewer on regulatory reform. New House Speaker David Gowan is also very committed to moving Arizona from a regulatory posture that’s too oriented toward punishment to one that’s oriented toward compliance.
What type of proposed regulations does the chamber keep an eye on?
HAMER: The Arizona Chamber actively monitors the regulatory environment. We have been active in workplace regulations, environmental regulations, labor regulations and anything that might affect the conduct of business in the state. We focus on accountability and encouraging an ongoing review of regulations to ensure they are cost-effective. The business community wants to be sure that the economic analysis of any proposed new rule is truly objective and reflects the costs created by federal and state legislative requirements as well as the incremental regulatory costs.
Are there any regulations in effect now that you would like to see eliminated or scaled back?
QUINLAN: Arizona small-business owners would welcome the institutionalization of a culture of compliance — one where small businesses are afforded an opportunity to correct a violation before any fine or penalty is enforced. For instances when public health and safety are not immediately at risk or the violation is minor, like a paperwork problem, Arizona should view that first violation as an opportunity to educate the regulated business and not play a game of “gotcha” that makes it more difficult for small-business owners to create and sustain jobs. That kind of approach would really say “Arizona is open for business.”
Are there any regulations in effect now that you would like to see eliminated or scaled back?
HAMER: At the federal level, nearly 200 regulations making their way through the pipeline are considered “economically significant” rules, which are defined as having costs of at least $100 million a year. A Small Business Administration study back in 2010 used several different sources to estimate a $1.75 trillion cost to the economy, which is disproportionately borne by small business. Arizona has continued to feel the heavy hand of government regulation of late. Arizona in just the last few years has seen its share of federal highway dollars put at risk as it battled with the EPA over the effect seasonal dust storms have on air quality readings in Maricopa County, and we’ve seen the future of the Navajo Generating Station jeopardized as part of a manufactured crisis over haze at our national parks that was really a proxy in the administration’s hard line against coal. Now we’re facing a proposed rule that would treat washes that fill with water only after big storms as navigable waterways and place them under federal regulation.
Are there any areas where you think additional regulation would help your members?
QUINLAN: I’ll let you know when any come to mind.
Are there any areas where you think additional regulation would help economic development?
HAMER: We’re not looking to institute new regulations, but there is evidence that Arizona’s approach to regulation has served us well. For example, Arizona’s historic water statutes, especially 1980’s Groundwater Management Act, have been critical in ensuring we have not faced the same acute water challenges that California is going through. If the business community identifies areas where regulatory tweaks need to be made to ensure our state’s continued competitiveness, we’ll speak up. For example, we’ll be engaging on proposed changes to the Clean Water Act and a proposed Clean Power Plan from the EPA.
How effective has the regulatory freeze been that Governor Brewer imposed?
QUINLAN: The regulatory moratorium has been one of Governor Brewer’s biggest success stories and a part of her political legacy that she should be very proud of. NFIB believes Governor Ducey can and will build on her accomplishments, further burnishing her legacy as the one who set Arizona on the path of becoming the most business-friendly regulatory environment in the United States.
For more, see “Regulation: Is Government Building Business or Breaking It Down?”
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