Regulatory Reform

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The economic future of Massachusetts depends upon the ability of the commonwelath to establish a world-class state regulatory system that ensures the health and welfare of society in a manner that meets the highest standards for efficiency, predictability, transparency and responsiveness.
 
Employers acknowledge the need for effective and well-managed regulation that ensures the health and welfare of society without weakening the financial underpinnings of the job market. But the employer community believes that Massachusetts regulations and the regulators who enforce them often stray from the primary objective of protecting society and into a mindset of “punishing” businesses.
 
 
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AIM Supports

Effective and Efficient Regulation of the Ride-for-Hire Industry in Massachusetts.

AIM Urges DPU to Craft Rules that Allow Growth of Transportation Network Companies

 

Improve Transparency of the Mass. Historical Commission

 

Amend General Laws 9:27C to require the Massachusetts Historical Commission to publish, on its Web site and at least twice per month: (i) summaries or copies of notices submitted as well as summaries of determinations or recommendations made by the commission; and (ii) listings of applications to and certifications made by the commission regarding eligibility or award of historic rehabilitation tax credits.

 

Blueprint for the Next Century | Regulation

1) The governor should appoint an independent ombudsperson to review comments, suggestions and complaints from employers about ineffective state regulations and/or the manner in which those regulations are enforced. The ombudsperson would have the authority to determine which regulations and/or enforcement issues represent real impediments to growth and recommend changes to the Legislature or the executive branch.
 

  • Associated Industries of Massachusetts, as the statewide business association, will establish a phone/internet hotline, or perhaps a mobile app, through which employers might report regulations they believe are not efficiently achieving their objectives. AIM would pass these communications to the ombudsperson

2) Encourage regulators and employers to adopt “smart partnerships” to ensure that government-business interactions solve problems instead of propping up bureaucracies.
 

  • The governor should engage willing employers who are global leaders in productivity and process improvement to streamline the operation of state government agencies. General Electric, an AIM member, provided just such a service for the New York State Highway Department at the request of Governor Andrew Cuomo. GE Capital used its expertise in lean process to help the Highway Department reduce the processing time for curb-cut requests from 70 days to three days.
  • Empower front-line regulators with the authority to approve creative solutions such as the one developed with Cape Air.

3) Initiate a comprehensive review to identify regulations that are outdated, redundant, ineffective, inefficient or unnecessary.

 

4) Eliminate current state regulations that exceed federal standards.

 

5) Adopt an immediate moratorium on any state law or regulation that exceeds or duplicates a federal law or regulation.

 

6) Enact broad regulatory reform at the Massachusetts Department of Revenue:
 

  • Ensure that taxpayer returns remain confidentially held by the DOR.
  • Ban DOR from lobbying the Legislature and other elected officials.
  • Reform the DOR’s audit practices to ensure timely resolution of disputes and increase the use the mediation.
  • Reform the Appellate Tax Board to ensure fair, equitable and timely resolution of tax disputes.
  • Eliminate the practice and use of contingent auditors.

     

7) Improve the DOR’s electronic filing system, which is one of the most challenging and complicated in the country.

 

8) The state should work with cities and towns to establish a set of efficiency and fairness standards for local issues such as inspections, fees and permitting.
 

  • Associated Industries of Massachusetts, perhaps in conjunction with the Massachusetts Municipal Association, will develop an annual rating of the business climate in cities and towns and recognize the top 10 municipalities for business.
  • The commonwealth and its municipalities should move toward regionalization of functions such as inspections and permitting to improve efficiency.

1) One central Massachusetts employer has two elevators in his facility – one for freight, the other for passengers. The company pays $1,100 to get each elevator inspected, but state officials refuse to inspect the two elevators at the same time. They require two visits, two payments of $1,100.
 
2) One entrepreneur describes an incident in which his small company lost a significant amount of money and was therefore required to file its tax return electronically. But the Department of Revenue did not permit the company to file using commercially available e-file software. The company had to spend hundreds of dollars to purchase the software required by DOR. The result – the company is moving to Texas, which will enjoy the benefit of high-paying jobs and a huge capital gains tax windfall when the entrepreneur sells the company in a few years.
 
3) The Massachusetts Toxics Use Reduction Act (TURA) has in many ways lived up to its name – fees established under the law have prompted scores of companies to reduce or eliminate their use of chemicals, cutting overall payments into the program. Unfortunately, the people who run TURA have taken that as a cue to jack up fees to a level that may drive many of the remaining companies out of state.
 

4) Massachusetts lawmakers and regulators often impose state laws and regulations that duplicate federal laws and regulations and create an administrative nightmare for small business.

 

5) Regulators appear particularly determined to preserve their authority and revenue flow when confronted with innovative ventures that disrupt an established industry. Manicube, a New York-based company that sends its licensed manicurists to serve customers in corporate offices rather than in traditional nail salons, recently found itself under investigation by the Massachusetts Board of Registration of Cosmetologists because the company employs licensed manicurists, but does not operate out of a licensed nail salon. Regulators of traditional taxi cabs have similarly moved to restrict the growth of Uber.

AIM Expert:
Brad MacDougall
Vice President
Government Affairs

Regulatory Reform
regulatory reform, regulation, Massachusetts,Blueprint for the Next Century, Associated Industries of Massachusetts
Massachusetts must establish a world-class state regulatory system that ensures the health and welfare of society in a manner that meets the highest standards for efficiency, predictability, transparency and responsiveness.