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State Board Report

July 2017

Groups that are working to reduce or eliminate occupational regulation and oversight were the focus of panel discussions moderated by NASBA Director of Legislative and Governmental Affairs John Johnson at the June Regional Meetings. He was joined by panelists Nathan Standley, Esq., Nicola Neilon (NV), Mark Ohrenberger (AR), Stephanie Saunders (VA), and Andy Wright (MS). Among the bills examined by the panelists were those that reflect the ideas and policies spearheaded by the American Legislative Exchange Council (ALEC), the Institute for Justice, the Cato Institute, Americans for Prosperity, the Mercatus Center and the Goldwater Institute.

Mr. Johnson noted that these groups believe occupational licensing is the most significant issue in labor economics, and they are no longer distinguishing between professional regulatory bodies such as Boards of Accountancy, and other occupations (e.g. hair braiders, auctioneers, and others). These advocacy groups often highlight the fact that, in the 1950s, only one in 20 Americans needed a license to work, but currently it is closer to one in three.They call these licenses “barriers to entry.” The Institute for Justice found that only 15 of the 102 low and moderate income occupations have been licensed in 40 or more states. These occupations typically bear little resemblance to professions like accounting. These groups also like to point out the disparity of licensed occupations between states. For example, California licenses 177 occupations while Missouri licenses 41. As Mr. Johnson noted, “CPAs constitute a profession that is regulated in 55 U.S. jurisdictions — and in many of those for more than 100 years. So much of what these advocacy groups are talking about does not apply to us. We have to write a story collectively on what we have done as a profession over the last three decades. From a pro-competitive perspective, the accounting profession has worked extremely hard to streamline the practice of accountancy throughout the country in an effort to ensure individuals can practice across state lines and adhere to our public protection mandate. Because of these state-by-state deregulation campaigns, we are now working on a strategy to educate these groups and legislators about the accounting profession, and get them to recognize that their ‘one-policy’ approach – which encompasses all occupations and professions is not the solution to their perceived issues with regulatory oversight. That it is, in fact, detrimental to the financial health of our citizens.”

Model acts that Mr. Johnson identified as having influenced legislation included: ALEC “Occupational Licensing Relief and Job Creation Act” (2012) and “Occupational Board Reform Act”(2016); Institute for Justice’s “Occupational Board Reform Act” (2016); Goldwater Institute’s “Right to Earn a Living Act” (2015); and Foundation for Government Accountability’s “Freedom to Prosper Act” (2017).

ALEC’s 2012 policy was the basis for legislation introduced in Arkansas, Iowa, Minnesota, and Nevada. The Institute for Justice’s model was used in Illinois, Maryland, Mississippi, Nebraska, Texas, and Virginia. The Goldwater Institute inspired legislation in Tennessee, and the Foundation for Government Accountability prompted legislation in Oklahoma and West Virginia. Mr. Standley warned: “There is a concerted effort going on for these canned policies. Legislators ran against government waste and government spending and they have an appetite for model legislation that purports to reduce governmental red tape and barriers to entry. In addition, many states have some advocacy groups and legislators looking into licensure elimination.”

Arkansas Board Legal Counsel Mark Ohrenberger reported that four deregulation bills were introduced in the Arkansas legislature. Two were introduced in 2015 and two in 2017, and all were variations of ideas found in the ALEC model. None, however, passed for now.

Nevada introduced three bills, one in 2015 and two in 2017, that were modeled after legislation developed by these groups, Nevada Board Member Nicola Neilon reported. SB 325, which had just failed on June 5, 2017, the bill would have created a task force on modernization of occupational licensing.

NASBA has mobilized in a number of states, including New Jersey, Georgia, Arkansas, and in Virginia, which had a large number of regulatory bills introduced. Virginia HB 1564 came from the Americans for Prosperity model, which calls for eliminating two rules for every new one proposed. That passed, Virginia Board Member Stephanie Saunders said, however, it had no funding.

Mississippi passed a law that created the Occupational Licensing Review Commission to review new regulations, but not existing ones, Mississippi Board Executive Director Andy Wright reported. The Governor is to chair the Commission, which will meet quarterly to review newly-submitted regulations, Mr. Wright explained. This went into effect on July 1, 2017.

Monthly updates on legislation impacting State Boards can be found on NASBA’s Legislative E-News, on www.nasba.org.