The Pennsylvania Senate Intergovernmental Operations Committee held a public hearing in Chambersburg Dec. 12 to address the need for regulatory reform for local businesses as well as the overall economic development of the state.
State Sen. Doug Mastriano (R-33), who chaired the hearing hosted by Martin’s Famous Pastry Shoppe, said that the regulations in place for Pennsylvania businesses make it seem like the government is working against them.
“Clearly, our government bureaucracy is too bloated, too cumbersome, too out of control and is indeed against us,” Mastriano said at the hearing entitled “Regulatory Reform, Red Tape Reduction and Transparency. “It is time that we rein it in and hold it accountable.”
Carl A. Marrara, vice president of government affairs for the Pennsylvania Manufacturers’ Association (PMA), said, “Our employers are facing an onslaught of regulations from a breadth of departments at both the state and federal level. This creates uncertainty in business planning and results in companies not growing, expanding, and hiring as they could.”
In his testimony, Marrara referenced a study submitted to the House State Government Committee in 2017 by Senior Research Fellow James Broughel regarding his project “State RegData.” Broughel found that the Pennsylvania Administrative Code contains 153,661 regulatory restrictions; some of which provide vital resident protections, and others of which make the code unnecessarily complicated.
“It is imperative that Pennsylvania regulators not enact regulations that place Pennsylvania at a competitive disadvantage to our competitor states,” Marrara said. “In the most recent Forbes ‘Best States for Business Report’ Pennsylvania ranked 39th in the category of ‘Regulatory Environment, significantly contributing to our overall ranking of 38th. This isn’t good enough.”
The committee heard testimony from more than a dozen speakers that echoed the same want for relieving the burden of a daunting regulatory code. Franklin County Area Development Corporation President Mike Ross said that overcomplicated regulations and underfunded government mandates, like those currently governing Pennsylvania, are a significant deterrent in the decision to start or expand a business in the state.
Rebecca Oyler, legislative director for the National Federation of Independent Business, noted that more than 99 percent of Pennsylvania businesses are small businesses that employ two-and-a-half million people, almost half of all workers in the state.
“They are truly the engine of growth. Because of their size, they are very sensitive to layers of government rules – rules that are difficult to manage and consume time and energy, two of the most important resources that small business owners need to be successful,” Oyler said in her testimony at Thursday’s hearing. “Layers of regulations impact their business, and they must be an expert on all of them – or face penalties. The more of the day they must spend dealing with red tape, the less time they have to focus on customers, manage employees, and grow their business.”
On behalf of the PMA, Marrara also brought to the committee’s attention several bills that have the association’s support, such as House Bill 1055, which creates an independent Office of Repealer within the independent regulatory review commission. This would allow for outdated regulations to be repealed to make room for new, updated regulations.
PMA also supports House Bill 509, which combats ‘permit paralysis’ through the creation of an online repository for every state department. Individuals, businesses, and nonprofits would then have access to that information and be able to track where their permit is in the review process. And for environmental issues, PMA supports Senate Bill 891, which would establish a program within the Department of Environmental Resources to allow the department to select qualified licensed professionals to perform an expedited review of permits.
“We need for state government to end the ‘GOTCHA!’ dynamic of fault-finding and imposing punitive fines and penalties as means of fundraising and instead make assistance with compliance the primary goal,” Marrara said.