Jason Tolbert: Womack’s Anti-Occupational Regulation Bill Is Too Broad

Rep. Richard Womack is the lead sponsor of HB1158 – a bill taking aim at state occupational regulations that has somewhat quietly worked its way through committee and is now heading to the House floor.

The bill states its purpose is to “ensure that a person may pursue a lawful occupation free from unnecessary regulation; and protect against the misuse of occupational rules to reduce competition and increase prices to consumers.”

This goal certainly sounds worthy, but the specifics of the bill are causing opposition to grow from many professional groups.

I will pause here to disclose that I chair the Arkansas Society of Certified Public Accountants (ASCPA) legislative committee and the ASCPA is one of the professional groups that publicly opposes the bill.  As such, my understanding of the effects of the bill are best understood in its potential negative impact on CPAs in Arkansas; however, the effects apply to pretty much any professional group regulated by the state.

The bill can be read in its entirety here, but basically the proposal would shift the burden of proof regarding the reasonableness of an occupational regulation to the state regulatory body. The proposal would give Arkansans a new “right to engage in a lawful occupation free from an occupational regulation.”

If an individual challenged a regulation in court, the state regulatory body would have to prove the regulation has “an important interest in protecting against present and recognizable harm to the public health or safety; and the occupational regulation is the least restrictive means of furthering the important governmental interest.”

The proposal is backed largely by the conservative libertarian-leaning group Advance Arkansas Institute headed by former State Rep. Dan Greenberg who spoke in favor of the bill in the hearing at the House Public Health, Welfare, and Labor Committee.

“The Arkansas General Assembly has an historic opportunity to lower prices for consumers and create more jobs – by reforming occupational regulation through Rep. Richard Womack’s HB 1158,” wrote Greenberg in a paper supporting the bill. “This bill does just one thing: it provides a defense for aspiring workers and entrepreneurs when regulators call them into court. The defense created by HB 1158 protects Arkansans from regulators who wrongly enforce licensing laws in ways that go beyond what the legislature intended.”

Greenberg – along with most of the bill’s supporters – point to a plethora of overreaching state regulations such as requiring licensing of people who transplant trees or shrubs.

Okay, fair point. But here is the problem – the bill takes a broad sweep at all state occupational regulations. And what is a reasonable regulation in the eyes of one court might be totally unreasonable to another.

For example, as a certified public accountant, I am required to take 40 hours of continuing professional education (CPE) every year. The Arkansas State Board of Public Accountancy (ASBPA) has all sorts of requirements regarding the content and type of continuing education that I have to take. You can read all seven pages of the Rule 13 regulating CPE for CPAs here.

Now suppose I grow tired of the time and expense of meeting these requirements every year. The new proposed law would allow me the ability to challenge this rule in court. The burden of proof would be on the ASBPA to prove that these rules protect public health and safety in the least restrictive means possible.

The Attorney General’s office would have to defend such a challenge for not only the ASBPA, but all such occupational regulatory groups. Although AG Leslie Rutledge’s office helped polish the language in the bill, she is not weighing in on if she supports the bill.

“The Attorney General’s office has worked with numerous legislators, including Rep. Womack, to ensure the bills and amendments filed are clear and effectively state the legislative intent,” said AG spokesman Judd Deere. “If the legislation becomes law, it will be the responsibility of the Attorney General to defend it on behalf of the state if challenged.”

I can’t help but wonder how many new attorneys the AG may have to hire to do that if the lawsuits pour in for all the various occupational regulations.

“The bill states that its purpose is to allow a person to engage in a lawful occupation ‘free from unnecessary regulation.’ The purpose is to make most professional and occupational licensing difficult, if not impossible, to defend,” said Thomas Curry, an attorney in Arkadelphia who spoke against the bill in committee.

The bill passed out of the House Public Health Committee last week – after failing on its first attempt – with 11 votes with the chair Rep. Kelly Linck giving the deciding vote after visibly pondering his vote for awhile. The bill is expected to head to the full House on Wednesday where it likely will face some tough questions.

I can share the supporters’ view that Arkansas has many regulations that need a closer look; however, the legislature needs to examine which ones are unreasonable and go after those specific ones. This bill is too broad of an approach that will place an additional and potentially costly burden on the state regulatory bodies. Let’s not throw the baby out with the bathwater.