Massachusetts Leads the Country in Regulatory Reform

Earlier this week, Governor Patrick announced a massive, top-to-bottom regulatory reevaluation for all state agencies.  By the end of 2012, the Administration will have reviewed 1,000 of the regulations that were first put into place prior to 2000, with another 1,000 by the end of 2013. The goal is to determine which regulations should be rescinded, which should be modified, and which could be made more consistent with a national model or standard.

This announcement may be surprising to some since Massachusetts, rightly or not, has not always had a business friendly reputation. With this new sweeping policy, the Governor has taken a hands-on, direct approach to ensure that there will be real results with immediate impacts.

In addition to the regulatory review, any newly proposed regulation must go through an extensive vetting process, lasting over nine months, that starts with a “small business impact statement” consisting of 25 questions delving into the potential financial and time costs.  Small businesses are defined as those with up to 500 employees (85% of the companies in the state.) All draft regulations will go to the Executive Office of Administration and Finance, and to the new Regulatory Ombudsman for fiscal and business impact review .  They will then go to the Governor’s office, where a case must be made that the agency’s recommendations outweigh the impacts and burdens on business and the public.  Only then will these regulations go on to the Secretary of State’s office for posting and public comment.

April Anderson Lamoureux, Assistant Secretary for Economic Development, was just appointed as the first Regulatory Ombudsman between the Administration and the business community.  She gave a detailed presentation on the regulatory reform initiative at the NAIOP Government Affairs program yesterday, along with Alicia McDevitt, Deputy Commissioner at MassDEP.

At the meeting, Assistant Secretary Lamoureux asked that businesses provide her with their suggestions on regulations that do not make sense, have extensive problems, do not add value, or where alternative solutions may better address the issue.  NAIOP has been appointed to a Business Advisory Committee that will help identify problematic regulations and alternative processes.

MassDEP, under the leadership of Commissioner Ken Kimmell and Deputy Commissioner Alicia McDevitt, has led the way on regulatory reform by establishing a target list of 21 different reforms within the Department.  McDevitt provided an update on the Final DEP Regulatory Reform Plan, which was released on Monday.  Although, the reason for this effort originated with a reduced budget affecting staff permitting and oversight, the effort has moved in the direction of creating general permits, self-certification, and third party reviews. Collectively, these reforms will make a substantial improvement on the cost and time for the regulated community, without diminishing environmental protection.

Kudos to the Governor and his Administration for boldly going where few states have gone! Massachusetts has clearly earned the status of “first in the nation” setting a policy to reform one of the most frustrating aspects of government for most businesses and citizens.  As always, others will follow.

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