Governor Signs 3 Bills to Reduce Burden of Regulations Upon Small Businesses

Wilmington – Following through on a commitment made in his State of the State address to further reduce the red tape and spur business growth in the First State, Governor Markell today signed three regulatory reform bills into law. House Bill 147 requires Executive Branch agencies to review the regulations on their books every 4 years, while Senate Bill 113 and Senate Bill 120 require agencies to consider the impact of new regulations and examine ways to reduce their burdens upon small businesses.

“Together, these 3 bills will improve transparency, increase accountability, and make life easier for small businesses. Today, as evidenced by the unanimous passage of this legislation, my Administration and members of the General Assembly are speaking with a unified voice in support of these goals,” said Governor Markell. “Although regulations are sometimes necessary, we must strive to ensure that they do not place unnecessary burdens upon individuals and businesses. This package of legislation, which includes good ideas from legislators on both sides of the aisle, builds upon our previous successful efforts to reduce red tape and improve Delaware’s business climate. I thank the members of the General Assembly for their support of these important measures.”

The bills signed into law today include:

House Bill 147 –– sponsored by Rep. Bryon Short, Rep. Danny Short, Sen. Brian Bushweller, and Sen. Greg Lavelle, and others – requires each Executive Branch agency to review the regulations on its books every 4 years, with a view toward modifying or eliminating those regulations that are no longer needed.  As promised in the Governor’s State of the State address, HB 147 makes Executive Order No. 36 – which in 2013 resulted in the elimination or modification of more than 100 agency regulations – a permanent part of state law.  Under HB 147, the first regulatory review process must begin no later than January 1, 2016.

“We took a big first step with Executive Order 36 in 2012 and built a great deal of goodwill with Delaware businesses who were pleased that state government was committed to streamlining and cleaning up its regulatory books,” said HB 147 sponsor Rep. Bryon Short (D-Brandywine Hundred). “By making that commitment permanent, we are showing our small business community that we understand the challenges they face on a daily basis and that we want to work cooperatively to help them contribute to our economy and our communities.”

Senate Bill 113 – sponsored by Sen. Gerald Hocker, Sen. Bobby Marshall, Rep. Bryon Short, Rep. Quinn Johnson, and others –  is one of two bills that comprise the Regulatory Transparency and Accountability Act of 2015 (“RTAA”). SB 113 requires each agency to submit a “regulatory impact statement” whenever it proposes regulations that would place additional burdens upon small businesses. Among other things, each regulatory impact statement must include (1) a description of the regulation’s purpose, as well as the individuals and small businesses that would be subject to it; (2) the estimated costs of compliance; and (3) a description of less burdensome methods of achieving the regulation’s purpose. In addition, SB 113 requires the Registrar of Regulations to submit regulatory impact statements to the appropriate committee of the General Assembly.

“I’m proud to be a part of this bipartisan legislation,” said Sen. Gerald Hocker (R-Ocean View), owner of five Sussex County businesses. “Since my wife, Emily, and I opened our first grocery story 44 years ago, it’s been increasingly difficult for entrepreneurs to start a business in Delaware and for existing businesses to grow. But these three pieces of legislation will help change that by eliminating some of the unnecessary costs that have become such a tremendous burden for our small businesses.”

Senate Bill 120 – sponsored by Sen. Bobby Marshall, Sen. Gerald Hocker, Rep. Q. Johnson, Rep. B. Short, and others – is the second bill that is part of the RTAA. Under SB 120, whenever an agency proposes a regulation that would place additional burdens upon small businesses, it must submit a “regulatory flexibility analysis” that examines ways to lessen the impact of the regulation.  In a regulatory flexibility analysis, agencies generally must consider (1) establishing less stringent deadlines; (2) using performance standards instead of design standards; (3) exempting individuals or small businesses from the regulation; and (4) other ways to accomplish the regulation’s purpose while minimizing the impact upon individuals and small businesses. In addition, SB 120 provides that if an agency does not submit the required information to the Registrar, the proposed regulation may not be published in the Register of Regulations.

“This legislation calls on each agency to perform a thorough analysis of new regulations to ensure they don’t impose unreasonable burdens on our business community,” said Sen. Marshall (D-Wilmington), who chairs the Senate Labor & Industrial Relations Committee and was the prime sponsor of SB 120. “Small businesses are the backbone of our economy and this bill will ensure that Delaware remains a place where they can grow and prosper.”

“As a small businessman, I know firsthand that our state’s regulatory structure sometimes can be more difficult to navigate than it should be, but I also know that our state agencies want to work with entrepreneurs and see our businesses grow,” added Rep. Quinn Johnson (D-Middletown), a co-sponsor of the bills. “With this legislation, our state agencies will now have the ability to work together with Delaware businesses to help them accomplish their goals, while still fulfilling their missions on behalf of the public.”

Both SB 113 and SB 120 become effective for all new or amended regulations submitted to the Registrar of Regulations on or after January 1, 2016.