SB12-006, Consolidation of State Regulatory Boards for Efficiency

SB12-006

Consolidation of State Regulatory Boards for Efficiency

Sen. Neville, Rep. Holbert

Staff Name: Constance Moylan

What the Bill Does: 
SB 120-006 would set up a task force that would review the current State Regulatory System. In addition to searching for ways to create a more cost effective and efficient system of regulation, the task force would review current boards to ascertain whether they reflect the needs of the current economic climate and business condition with the goal of avoiding outmoded regulations or excessive costs to industries.

Colorado Context: 
The Colorado Department of Regulatory Agencies (DORA) was created in 1968 and includes such agencies as Medical Examiners, Dental Examiners,  the accounting profession, Real Estate Board, Credit Unions,  etc. The Department includes 10 separate divisions having 41 boards, commissions, and advisory committees across more than 50 individual professions and programs. There are 250 board members and 578 professional regulatory staff listed in the Official Budget for 2010-2011. The overall budget was more than $22.6 million for the budget year of 2010-2011. The mission of DORA is to protect the consumer. #

National Context:  
Each state has regulatory agencies that oversee most professions from medical professionals to interior design and banks. There is no single method for regulating the regulators or organizing the regulatory boards. For comparison, the Illinois Department of Financial and Professional Regulation oversees everything from barbers to banks.  IDFPR has not had a full Regulatory review but rather, has done reviews of various professions or divisions on a rolling basis over the past ten years. #

Provisions of the Bill:

• A task force of 14 members will be appointed by July 1, 2012, consisting professionally of

• 2 state senators and 2 state representatives
• 2 leaders from private industry, 2 leaders from small to medium sized businesses, 2 from research and/or advocacy groups that focus on business policy or the economy, and 2 from academia or former employees of a state regulatory body with rule-making experience or  significant project management experience.
• The 10 non-elected appointees should consist of 4 registered members of each of the two major parties, and 2 should be unaffiliated

• The Task Force will review the State’s Regulatory System to determine many factors, including whether

• the current system gives a regulatory advantage to one segment of an industry?
• the current cost-benefit analysis is sufficiently strong per Section 24-4-103 (2.5) to produce meaningful measures of adverse impacts on consumers and private industry?
• the current system of enforcement allows or creates incentives for unreasonably punitive fines or  penalties on private parties?
• the current economic situation merit downsizing of any regulatory bodies and there be any reduction of financial compliance costs
• the current regulatory boards for any given industry current and up to date?there is a redundancy with other regulatory boards such as Federal Regulatory Systems?
• regulated industries are still in need of regulation or if other solutions are available, such as market standards that would allow the industry to be removed from regulation and save the state funds?
• the number of currently regulated businesses are more or less than in the 2008-09 fiscal year?other compliance costs can be reduced or eliminated without risk to the public welfare or the environment and without creating or protecting a monopoly?

• The Task Force shall include an analysis of cost savings to regulatory agencies and to regulated industries based on both direct and indirect compliance costs.

Fiscal Impact:
A fiscal note is not yet available. The fiscal impact of the Task Force is unknown but would include the use of Legislative Staff to assist in research and may include the creation of a budget.  The overall impact of forming the committee should be offset by creating a more efficient system, but actual savings are dependent on the task force recommendations.