PROVIDENCE – A new report on Rhode Island’s regulatory climate released Wednesday called for “fundamental changes” to state laws and regulatory entities to make the state more hospitable to businesses.
The release of the “look back” report by the Office of Management and Budget’s Office of Regulatory Reform, announced by Gov. Lincoln D. Chafee, came at the end of Period One, ORR’s first 90-day session in a 19-month process reviewing Rhode Island’s regulatory system. The review and reports evaluate the overall reform process that the General Assembly and Gov. Lincoln D. Chafee initiated in September 2012.
“This is the beginning of partnership among our office, regulators and the business community to streamline the regulatory process,” ORR Director Leslie Taito said in a statement.
The report relied on review submissions from various state agencies and regulatory entities, as well as Small Business Survey data from earlier in 2013 and other regulatory best practices research.
The authors of the report wrote in its executive summary that they recognized the need to balance a more streamlined regulatory climate to attract investment with regulators’ mission to protect Rhode Islanders. But, they wrote, “the ORR has discovered significant challenges to overcome in order to realize the vision for a clear, predictable, and reliable regulatory system.”
The report synthesized its findings into 10 specific recommendations. It proposed mapping the current regulatory environment to clarify the relationships between different entities and make them easier to navigate, a task it said the ORR would undertake.
It also recommended a reduction in the number of statutory exemptions. Of all regulations, 21 percent were exempted from the reform process, the majority of which were economic.
The report’s other recommendations were:
Making regulations — more than 26,000 pages in total — more accessible by standardizing formats and improving readability;
Eliminating redundant regulations across different entities;
Rejoining regulations that have been broken down into several components back into one whole, to decrease confusion and ensure high standards;
Reforming the enforcement, auditing and inspection processes;
Encouraging lawmakers and small business owners to play a bigger role in the ongoing reform process;
Improving regulatory entities’ cost-benefit analyses, given the incomplete data many provided to the reviewers;
Supporting the entities through a continuous process of improvement
And expanding the scope of reform efforts beyond the current levels, under which the regulatory entities collectively recommended maintaining 94.2 percent of their regulations without any changes.
Overall, 27 regulatory entities complied with the reform process and submitted materials, while 20 did not, but the latter group accounted for only 5.3 percent of total regulations. Fourteen entities submitted all of their regulations.
Reviewers received 838 submissions, more than twice the 25 percent target set by Chafee. But the report cited “significant data quality issues,” including many entities that could not identify the number and type of small businesses affected by their regulations, or the economic costs and benefits of their rules.
The report noted its concern that Rhode Island regulations disproportionately affect small businesses. Despite the many obstacles to reform, it repeated its hopes for creating “a clear, predictable and reliable regulatory system” by the end of the process.