First, conduct periodic occupational licensing reviews. In addition to abolishing occupational regulations in obvious cases of political favor, licensing laws should be subject to removal if: Few other jurisdictions (say, fewer than one-third or 40 percent) have seen the need to license the occupation, Too few practitioners are licensed to financially justify the existence of the licensing board, or There is a history of little or no enforcement activity, suggesting that either the licensing board is not doing its job or there is no cause for action, and thus that the board is unnecessary.
The City of Indianapolis successfully employed this strategy through its “Fair Fees for Small Business” initiatives in 1994 and 1996. The city’s regulatory study commission helped to eliminate the most blatant special-interest licensing regulations, including rules governing shuffleboard tables and milk cows. A similar process should be undertaken at the state level in Arizona and elsewhere.
And second, enact sunset provisions in licensing laws. Sunset provisions cause the law in question to expire after a certain period of time unless they are specifically renewed by legislators. Enacting such provisions in occupational licensing laws would improve accountability by forcing occupational licensing boards to periodically justify their existence. Rather than allowing more and more confusing licensing codes to pile up and be forgotten, as they have a tendency to do, legislators would have to take a more active interest in the scope and effectiveness of licensing laws.
Reason Foundation
April 1, 2008
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