Tracking Red Tape Relief In The 2023 Legislature
"Ensuring a small and efficient government requires proposals like this to ensure you are spending more time with customers and clients and less time staring at regulations."
It’s been almost two years since Governor Gianforte initiated the Red Tape Relief Initiative. It was Gianforte’s first executive order – and for good reason. We’ve noted before that Montana has accumulated tens of thousands of rules and regulations on the books, many of which no longer foster a level economic playing field while ensuring public safety. Traditionally, regulators in Montana have been focused on proposing new regulations while little concern is given to removing or reconsidering past regulations. State agencies are required by law to review their regulations every two years, but in practice the identification of regulations to be repealed or simplified has been done seldomly, if at all. This method is called “regulate and forget.” According to the Executive Order, a council was created to plan a comprehensive review to identify:
- Regulations that are excessive, outdated, and unnecessary regulation,
- Regulation that are especially burdensome on Montana’s farmers, ranchers, and business owners;
- regulations that disproportionately impact small businesses;
The burden of unnecessary and relic regulations slows economic growth and distorts investment choices. According to a 2016 study from the Mercatus Center, federal regulations slowed average U.S. economic growth by 0.8 percent per year since 1980. The same study noted that the 2012 U.S. economy would probably be 25 percent larger had regulations remained near the same aggregate level. New technologies and innovations require a new approach to regulation. A dynamic Montana economy requires a dynamic government that reduces barriers to prosperity and eliminates overburdensome regulations.
Thankfully, Gov. Gianforte’s Red Tape Relief Initiative is moving Montana away from the “government cures all” philosophy and “regulate and forget.” The Frontier Institute is closely tracking the progress of the Red Tape Relief Initiative and is developing a tracker for new legislation and rule notices which advance the goals of the Initiative. So far, we have identified 78 separate legislative proposals from state agencies which advance the Red Tape Relief Initiative’s mandate. Most of these legislative proposals have focused on eliminating unnecessary regulations and outdated requirements. Below I highlight five legislative proposals from state agencies which advance the objectives of the Red Tape Relief Initiative and will positively impact Montanans and their businesses:
The State Auditor’s office is proposing the repeal of the Insurance Continuing Education Council. Repealing the council removes an unnecessary hurdle for approving the 24 continued education course credits required every two years to maintain an insurance agent license. Currently a cumbersome seven person council serving two year terms is responsible for merely reviewing and recommending continuing education courses. Instead the State Auditor can contract with an outside service and ensure it provides timely and consistent approval for education credits throughout Montana.
The DPHHS seeks to revise the Adult Protective Services laws (APS). APS are responsible for protecting adults who are unable to protect themselves due to physical or mental limitation. This is in response to the Governor’s executive order establishing Elder Justice Councils. The East Montana Council identified limitations in the APS, such as the outdated definition of physical abuse. The current definition only recognizes physical abuse when death, permanent or temporary disfigurement, or impairment occurs. This proposal will remove APS’s outdated language, revise terminology, and remove outdated references. By finally modernizing Montana’s APS, we can ensure our elders can be protected from continued abuse, negligence and financial exploitation.
Especially Burdensome Impact on Small Business
As they currently stand beer, wine and spirits regulations require a lot of red tape relief. One aspect, in particular, is the alcoholic beverage tax statutes. The Statutes have not been consistently updated, and the collection process needs to be consistent with other state taxes. The Alcoholic Beverage Control Division proposes updating the tax collection procedure followed by other state departments and removing the burdensome penny tax for wine.
One outdated statute directs counties to pay administrative fees to a general fund for group homes. The problem is that DPHHS has not enforced this section for decades. The state-administered welfare system makes it nearly impossible to determine when a county will be subject to this fee. The proposal to remove this regulation will remove an unused mechanism of getting fees from counties.
Remove Unnecessary Regulation
The lodging facility use and sales tax are located in different chapters of Montana’s tax code, even though they relate to the same types of transactions. Two separate chapters for the same transactions create unnecessary confusion for Montana’s hotel and renting industry and the Department of Revenue itself. The proposal will streamline the return of in-state lodging tax payments by having all lodging-related taxes under one title and chapter.
These proposals are not flashy by any stretch of the imagination. But what they all do is make it easier to maintain your insurance license, protect your parent or grandparent, remove burdensome taxes and remove confusing regulations. Ensuring a small and efficient government requires proposals like this to ensure you are spending more time with customers and clients and less time staring at regulations.
There’s no doubt about it, Red Tape Relief is on its way! Stay tuned as I continue to track these proposals throughout the 2023 legislative session.