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Bill would make agencies prove their regulations are necessary

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State lawmakers are moving to effectively stand state regulation of businesses on their head, requiring government agencies to prove their rules and restrictions are necessary.

On a 5-3 margin Jan. 27 the House Commerce Committee voted to require every city and county government and state agency to review every regulation and detail how each is necessary to protect public health, safety or welfare. It then mandates that the restrictions be modified or repealed if they do not serve those purposes.

More to the point, it allows anyone who believes any rule or ordinance is excessive to sue. And if the government does not prove its necessity — and the burden would be on the government, not the person challenging the rule — a judge would be required to void it.

Jon Riches, lobbyist for the Goldwater Institute, said the legislation is a push back against what he believes is government encroachment on private business.

He cited one instance where the state Board of Cosmetology said a woman cannot connect licensed beauticians with home-bound cancer patients because the agency said that left them no premises and equipment to examine. And in another case a Tempe woman who made a business out of making salsa at her house was forced out of business.

Rep. Warren Petersen, R-Gilbert, who agreed to sponsor the measure for the Goldwater Institute, called it long overdue.

“I can tell you from personal experience there’s been an onslaught of regulations in my industry in the last 15 years, a ridiculous amount,” said Petersen who owns a real estate brokerage firm. “It’s time for us to protect individual rights.”

And that, he said, means reviewing and curbing regulations.

“If they don’t have a direct nexus with health, safety or welfare — welfare principally meaning fraud — then those regulations need to be eliminated,” Petersen said.

Patrice Kraus, lobbyist for the League of Arizona Cities and Towns, said the measure is flawed.

For example, she said a city must prove a regulation is “necessary” to protect health, safety or welfare. Kraus said that would allow a business owner to argue that a retail sales tax permit is illegal because it is not necessary to meet any of those goals.

“This could lead to a lot of frivolous lawsuits,” she told lawmakers. And Kraus noted that the law does not allow cities to recover their legal fees even if a judge concludes that was the case.

Riches defended that provision ensuring that those who sue face no financial risk, even if they lose,  saying it would be wrong to let a city seek legal fees from “somebody who’s just trying to earn a living.”

Rep. Stefanie Mach, D-Tucson, said Petersen’s legislation is built on a fundamental misunderstanding that somehow the people in government are the enemy in regulating business.

“The big bad government is just a group of people like us who have been elected or appointed or hired to do a job,” she said.

Mach said oversight is sometimes needed.

“There are a lot of businesses that have fraud factored into their bottom line,” she said. And Mach said that standards are necessary, citing that case of the Tempe salsa maker.

“Shelf life could actually be an issue,” she said. “We need to make sure that people aren’t dying or getting salmonella because of relaxed practices.”

One comment

  1. Can I sue the government if I get sick or hurt using a private company’s product/service because there is a lack of regulation? How about the people who proposed, wrote and/or passed the bill into law? Seems only fair for a customer to have some recourse available to them.

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