Florida’s Dirty Dozen Twelve Repealers That Can Boost Business, Create Jobs, and Change Florida’s Economic Policy for the Better By Ari Bargil and Claudia Murray Edenfield Foreword by J. Robert McClure, Ph.D. President and CEO, The James Madison Institute Authors’ Acknowledgements The authors wish to acknowledge the significant contributions of Bob Sanchez and alerieV Wickboldt of The James Madison Institute, IJ Law Fellow Nneka Utti, and IJ Law Clerk Jared Sonnenklar. Immeasurable gratitude is also due to the entire team of IJ attorneys and ex- perts who participated in the evolution of this project, from inception to completion, for their invaluable insight and encouragement and for their inspirational zeal in fighting for liberty. Most importantly, the authors wish to thank the entrepreneurs of Florida for their bravery and commitment to our great state. Florida’s Dirty Dozen: Twelve Repealers That Can Boost Business, Create Jobs, and Change Florida’s Economic Policy for the Better by Ari Bargil and Claudia Murray Edenfield Institute for Justice February 2014 and supplies—at one of Florida’s least expensive providers—currently tops $16,425. So to enter her chosen field will mean going into debt with student FOREWORD loans to pay for “training” far in excess of what rea- sonably should be required. And all this not because of any legitimate concern for public health and safety, J. Robert McClure, Ph.D. but merely because industry insiders have gone to President and CEO, The James the government as a means of protecting themselves Madison Institute from competition or protecting their profits, neither of which is a proper use of government power. Governments too often go well beyond what’s Unfortunately, in Florida these kinds of govern- required to protect the public’s health and safety. ment-imposed barriers to entering a career are not Nowhere is this more evident than in business unique to cosmetology. In fact, they extend across regulations that stifle industries. Frequently, public a wide array of occupations. This study highlights officials use “safeguarding the public health” or a “dirty dozen” of these kinds of obstacles that the “protecting consumers” merely as a pretext for Institute for Justice (IJ) regards as among the worst. allowing entrenched special interests to create The James Madison Institute (JMI), which for many obstacles for potential competitors, thereby gain- years has battled against the kinds of regulatory ing an unfair advantage in what ought to be a free overkill marring Florida’s otherwise excellent busi- marketplace. This study identifies 12 instances in ness climate and quality of life, agrees that the issue which the Legislature has relied on these empty deserves immediate attention from the Legislature. justifications—often provided by industry insiders— Of course it should come as no surprise that and suggests that repeal of these laws would make JMI and IJ have a mutual interest in this issue. In- Florida a more welcoming place for consumers and deed, these groups have a great history of coopera- small businesses. tion in the fight for liberty. Both organizations share Consider, for instance, a would-be entrepre- a devotion to the principles of limited government, neur whose goal in life leans less toward college individual liberty, and personal responsibility. and more toward pursuing a craft that she has Florida’s current system of occupational licens- learned to love: doing hairstyling and makeup. She ing and regulation should be reassessed because is a recent high-school graduate. She is ambitious, it is clear that the current outcome— often over- as well; her goals include eventually opening a reaching regulations—is a problem that stifles our salon of her own. economy, raises the cost of living, and makes it But she is also realistic. Even though she has much more difficult for ambitious young people, practiced her craft, cutting hair and giving makeup such as our hypothetical entrepreneur, from achiev- tips to friends and family, she understands that she’ll ing their goals. need some additional training. Imagine her sur- IJ deserves tremendous credit for conducting prise, however, when she discovers that she will be the in-depth research required to bring these situa- required to undergo 1,200 hours of instruction at a tions to the attention of Floridians and their elected “beauty school” where the cost for tuition, fees, book, officials. The next move will be up to those officials. 2 Table of Contents Introduction . 5 Burdensome Regulations: Shields Against Competition . 5 Repealers: A Built-in Solution to Overregulation . 5 Shifting Legislative Paradigms . 6 Interior Designers. 7 How Repealers Can Help Real Floridians: Eva Locke . 9 Barbers . 10 Auctioneers . 11 Cosmetologists: Generally & Cosmetologists: Makeup Artists . 12 Non-Traditional Lodging Rentals . 14 How Repealers Can Help Real Consumers: Alejandra and Geoff Silvera . 15 Travel Agents . .17 Midwives . .18 Funeral Directors . 19 Talent Agents . 21 Growlers . 22 How Repealers Can Help Real Floridians: Tipple’s Brews . 24 Household Movers . 26 Conclusion . 27 Endnotes . 28 Occupational Regulations Occupational Regulations Licensing Certification Registration Bonding or Insurance Inspections Private Civil Action to Remedy Consumer Harm Market Competition This graphic depicts different types of occupational regulations, from least burdensome (at the base) to most burdensome (at the top). Many of the laws discussed in this publication overregulate in that they unneces- sarily occupy levels too close to the top of the pyramid. Legislators should regulate occupations in the least intrusive manner, starting from the bottom of the pyramid and moving up only if they can demonstrate it is actually necessary. 4 Introduction Road signs welcoming visitors to sale of malt beverages in standard- sized containers, hurting a growing Florida boast that the Sunshine State is industry by outlawing something that “Open for Business.” But is it? The state’s is legal in most states. focus on building businesses has fallen In 2011, legislators proposed short. Endless and unnecessary regula- a bill to deregulate 20 occupations, tions plague small businesses statewide, some of which—talent agents, and artificial barriers to entry make it auctioneers, travel agencies—are discussed in this report. However, difficult—sometimes impossible—to start “the bill eventually failed in the face and grow viable businesses. But there is a of stiff resistance from industry pres- solution. To strip away pointless, problem- sure.”3 To combat anticompetitive atic legislation that stands in the way of regulations, Florida legislators need economic growth, legislators have a valu- to focus on eliminating laws and able tool at their disposal: repealers. use the mechanism known as the “repealer bill” to get rid of unneces- sary laws that harm the state’s small businesses. Burdensome Regulations: Shields Against Competition Repealers: A Built-in Solution Many of these arbitrary regulations are to Overregulation passed at the request of professional associations and government boards that want to protect the Every year, the Florida legislature passes about pocketbooks of their members by shutting out new 300 new laws.4 And every year, the new regula- competition. In 2012, the Institute for Justice (IJ) tions pile onto the already-existing ones, reinforc- published a study on the burdens of occupational ing the barriers to entry that prevent or dissuade licensing and found licensing laws stall job growth entrepreneurs from starting new businesses. In fact, and economic development across the country.1 so many new laws are proposed each session that The study found Florida has the fourth-most- representatives are, by rule, prohibited from introduc- burdensome licensing requirements in the country, ing more than six bills per session.5 Representa- often imposing restrictions on occupations that tives may also introduce “[b]ills that only repeal or most other states do not even bother to regulate— delete, without substantive replacement, at least a like interior designers and travel agents—because paragraph of the Florida Statutes or Laws of Florida.” they pose no harm to consumers.2 These “freebies” are known as “repealers,” and they Occupational-licensing laws are not the only do not count toward the limit on the number of bills a burdensome restrictions hurting small businesses representative may introduce.6 in Florida. Nonsensical state laws also restrict Oftentimes, the best way for government to whole Florida industries from competing effectively help create jobs and boost the economy is simply with other states. For example, the state bans the to get out of the way.7 If Florida legislators are 5 serious about The offending regulations concern: helping jumpstart 1. Interior designers new business and 2. Barbers helping small busi- 3. Auctioneers nesses survive, 4. Cosmetologists: Generally they should start 5. Cosmetologists: Makeup Artists employing the tools 6. Non-Traditional Lodging Rentals they have available 7. Travel Agents and use repealers 8. Midwives to cut away the red 9. Funeral Directors tape that is binding 10. Growlers Florida businesses. 11. Talent Agents Photo by Steve Bousquet of the Tampa Bay Times 12. Household Movers Shifting Legislative Paradigms For each of these regulations, IJ suggests the repeal of at least one paragraph of a statute without Too little emphasis is placed on eliminating suggesting any additions to the text, making each