Politics & Government

After six months, Bevin’s ‘red tape reduction’ plan has brought little change

Kentucky Gov. Matt Bevin wears a “Red Tape Reduction” pin while listening to President-elect Donald Trump speak in Cincinnati.
Kentucky Gov. Matt Bevin wears a “Red Tape Reduction” pin while listening to President-elect Donald Trump speak in Cincinnati. Office of the Governor

There’s a new uniform in the Kentucky Capitol these days, worn on the lapels of the dark-suited staffers of Gov. Matt Bevin. It’s a bright red pin with a pair of open golden scissors inside.

The pin is the symbol of Bevin’s Red Tape Reduction Initiative, a pledge to reduce the regulatory burden in Kentucky and make the commonwealth more business friendly.

Through December, Bevin’s initiative has repealed 117 regulations and amended 96 more, which amounts to about 4 percent of the state’s 4,875 regulations. Another 10 regulations have been approved since January, which means Bevin is repealing 12 regulations for every regulation added.

The general public loves to hear such numbers, said Stephen Voss, a political science professor at the University of Kentucky.

“Americans are extremely suspicious of government bureaucracy,” Voss said. “And we perceive government agencies as unintentionally throwing up roadblocks when we’re trying to accomplish things.”

The details behind the numbers, however, are less compelling. Not a single repealed regulation will generate or lose significant revenue for the state, according to fiscal impact reports provided to lawmakers. And in several instances, the changes Bevin’s administration has made to regulations actually add regulatory requirements instead of deleting them.

Bevin, who has not publicly articulated a definition for “red tape reduction,” declined to be interviewed for this story and his spokeswoman did not respond to questions submitted in writing.

At a news conference in early December, Bevin pledged to reduce “red tape” in Kentucky by one third before the end of his first term.

4,875 The number of regulations on the books in Kentucky

In July, the first month of his initiative, Bevin’s administration repealed as many regulations as were repealed in all of 2015, but reducing the state’s regulatory burden by a third in the next three years may prove difficult.

“I think the governor’s goal is admirable,” said state Sen. Ernie Harris, R-Louisville, the co-chairman of the legislature’s Administrative Regulation Review Subcommittee. “We’ll see if we get there.”

‘Cleaning out your attic’

So far, most of the “red tape” cut by Bevin has had little impact on people and businesses.

Almost all of the 117 regulations repealed since June have been labeled as “duplicates,” “antiquated,” “obsolete” and “superseded,” according to reports filed with the legislative committee that presides over state regulations.

Still, simply cleaning up the state’s books can have a positive impact.

“If he’s eliminating regulations that are redundant or unimportant, it’s hard to see where this is a bad thing,” Voss said.

Harris said eliminating duplicate or outdated regulations is important because it provides clarity for those who must follow the regulations.

“It’s sort of like cleaning out your attic or your basement,” Harris said. “You’ve got to go through and clean it out from time to time.”

12:1 The ratio of repealed regulations to new regulations under Gov. Matt Bevin.

Unlike the repealed regulations, some of Bevin’s amendments to the regulatory code will have a noticeable impact on businesses and their customers.

One of the most publicized examples was eliminating the blood rule — a regulation that said officials had to stop a live televised wrestling match if one of the participants started bleeding.

In an analysis of the amendment’s impact, the Boxing and Wrestling Commission said the change will “promote professional wrestling throughout the commonwealth while attracting professional organizations to hold events and create a positive economic impact.”

The administration also loosened up several rules pertaining to plumbing, giving business and home owners more freedom to install low water-usage toilets and PVC pipes in buildings that are taller than 45 feet.

Still, many of the amendments to regulations amount to little more than bookkeeping.

According to a Herald-Leader analysis of the 86 amendments through November that Bevin claims on his Red Tape Reduction website, about 23 percent simply brought Kentucky into compliance with changes in federal regulations, some of which had not been updated for years.

“If we have to mirror the federal regulations, then we have no choice,” Harris said. “We live with that.”

At least half of the amended regulations could be considered neutral to “red tape,” meaning they often made technical changes for clarity or made corrections to bring regulations up to date with existing statutes. For example, one amendment updates a regulation so that it references a 2017 handbook instead of a 2016 handbook.

Another 17 percent could be seen as adding regulatory burden, from requiring people to record the number of deer they kill on their property to establishing procedures related to appeals and complaints for benefits and services.

Roadblocks

Bevin’s administration has examined about a quarter of the state’s regulations so far, searching for improvements and efficiencies, but he will need help from lawmakers to reach his goal of eliminating one third of the state’s rules.

For example, Bevin has said he hopes to repeal the state’s prevailing wage law, which requires government agencies to pay a set wage for construction rather than accepting the lowest bidder.

If the General Assembly takes action to eliminate the prevailing wage law, as is expected, several regulations would become obsolete, aiding Bevin in his attempt to reduce the overall regulatory burden.

But if the General Assembly passes other laws that require more regulations, Bevin’s administration is handcuffed.

“We want to be careful when we create legislation that we don’t hamstring the administration with unintended consequences,” Harris said.

Bevin also is limited by the federal government. If more regulations are approved in Washington D.C., or created by the administration of President-elect Donald Trump, Kentucky has no choice but to create state regulations that mirror the federal rules.

Another potential roadblock is that most regulations are written for a reason.

“The answer to this is not deregulation,” said Philip Howard, the founder of Common Good, a conservative-leaning nonprofit that focuses on regulatory reform. “I would argue that in some areas, like environmental regulations, we need more regulation.”

Bevin, on his Red Tape Reduction website, acknowledges this fact as he references a similar initiative in British Columbia, Canada, where the province’s government attempted to reduce regulations in order to stimulate economic growth.

The province originally called it a “deregulation” plan, which Bevin’s administration said was poor language choice because “necessary government rules are not going to be eliminated.”

British Columbia started with a goal of removing two regulations for every regulation added. After the government felt they had regulations under control, they created a policy of removing one regulation for every new regulation added.

For now, the Bevin administration is focused more on reducing regulations. Howard, though, argues that pruning isn’t always enough.

“It does do some good, but ultimately, what’s good is what works,” Howard said. “The regulatory process should be a constant process, not on passing new laws, but looking at how old regulations work.”

Sending a signal

The exact impact of Bevin’s initiative on Kentucky’s economy has yet to be determined. But from a political perspective, he can’t lose.

“It’s a framing issue,” Voss said. “When deregulators can frame the policy change as trying to shrink the burdens created by government bureaucracy, people respond relatively well.”

The initiative also helps present an image of a state proving to businesses that it’s on top of the regulatory code.

“If the goal is to say that there is now an administration in place that is much more business friendly and we want to send a signal, this seems like a pretty cost effective way to send a signal,” said Ken Troske, an economist at the University of Kentucky.

The initiative also could eventually boost the state’s economy in more concrete ways, but it’s too early to make that judgment, Troske said.

“I think it has the potential to have an impact,” he said. “I’d like some more evidence on it.”

Daniel Desrochers: 502-875-3793, @drdesrochers, @BGPolitics

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