How to reform regulations

·3 min read

Twenty-six agencies, said the director of the Cattle Growers Association, speaking at a public forum several years ago. Federal and state. That’s the number of regulatory agencies her members – New Mexico’s ranchers – had to deal with.

Then the state’s courts required farmers and ranchers to have workers' compensation coverage, terminating a longstanding exemption. Twenty-seven.

Employment regs. Environmental regs. Building regs. Regs about animals. Food standards. Riparian regs: cows drinking from streams and muddying the riverbanks. Every regulation serving a legitimate purpose – collectively, mindboggling. Methane regs for cow flatulence, maybe not yet.

The governor has launched a worthy effort to streamline regulations affecting business, to be led by the Economic Development Department and the Regulation and Licensing Department.

First point: In the language of regulation, government people and business people literally do not speak the same language or understand words to mean the same things.

To government people, a regulation is not a law. Laws are enacted by the Legislature and can only be changed by the Legislature. Regulations are enacted by a state agency, administered by that agency and incorporated in the state’s administrative code. Regs can be changed by the administrative agency.

To business people, there is no distinction between rules and laws and very little distinction about which agency does what. There is just a big pile of things they have to do. The distinction is meaningless.

If we are serious about fixing regulation, we have to follow wherever the business folks take us. That means crossing agency boundaries and asking for legislative as well as regulatory changes. Observe how successful we’ve been so far in simplifying the state’s tax code. (That is, not one bit.)

Second point: If you think the Regulation and Licensing Department is where all the regulations live, you have been misled by the name. Regulation and Licensing is the department that governs the licensing requirements of specific industries. It is composed of several divisions: Alcoholic Beverage Control, Boards and Commissions, Cannabis Control, Construction Industries, Financial Institutions, Manufactured Housing, and Securities.

This is nowhere near all the industries that the state regulates. Nor does it cover all the regulations that govern those industries.

The Boards and Commissions Division regulates 29 industries or professions very different from each other, each with rules, licensing requirements, and an appointed board. A small sample: Accountancy, body art practitioners, funeral services, optometry, real estate appraisers.

To me, the big challenge appears to be Construction Industries (CID), possibly because I know less about the Securities or Financial Institutions divisions. In CID, there’s a potential for battles about matters like green building standards. Those arguments will not necessarily result in streamlining. And CID does not cover employment laws or tax laws governing the very same businesses. For example, workers’ comp rules are administered by the Workers’ Compensation Administration. Construction could probably rival the ranchers in the number of agencies to which they are answerable.

I can also foresee fistfights in small divisions like the Massage Therapy Board. I will reserve the details for another column or we could be here all night.

Third point: Agency staffs don’t generally talk to other agencies. They may not know about regulations other than their own. The person who insists that you pay a certain tax or fill out a certain form is probably blissfully unaware of the other taxes and forms that you are subject to. That person might believe that business people have nothing more urgent to do with their time than comply with regulations.

If any regulatory reform is to be successful, it will be up to business leaders to take the lead, insist on breaking down the silo walls, and demand the reforms they really need.

Contact Merilee Dannemann through www.triplespacedagain.com.

This article originally appeared on Carlsbad Current-Argus: How to reform regulations

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