Businesses welcome transparent, accessible, accountable state & local regulations

James FrankoTax & Spending

Adapted from the foreward to KPI’s recent “Business Perceptions of the Economic Impact of State and Local Government Regulations” paper. Check out KPI’s podcast discussion of the paper, the key findings, and related topics.

When policy debates turn to job creation there is often scant detail beyond platitudes and talking points. “We need lower taxes.” “Targeted government investment is the name of the game.” “Create an environment in which all can succeed.” “Regulations need to be updated for the 21st Century.” Politicians from across the political spectrum offer bromides that serve their previously held beliefs while citizens and businesses struggle to decide who is right.

The recent Wichita debate on a new city sales tax…not to mention local elections this week…Kansas’ move to lower income taxes, and the national debate on a recovery that goes in fits and starts all circle around the same topic – what does it take to create more jobs and provide more opportunity. Taxes and regulations warrant the most coverage and comment in this conversation, as they are most commonly cited by businesses. While some literature exists on the national regulatory regime, there is very little specific research on state and local regulations. This is even more-true of Kansas and the greater Wichita area.

We recently partnered with Wichita State University’s Hugo Wall School of Public Affairs to take the pulse of local businesses and their interactions with regulators at the state and local level. Under the guidance of Nancy McCarthy Snyder, Ph.D., the research team conducted several focus groups with local business associations to better understand their specific experiences with the regulations and the people who enforce them. The groups and businesses interviewed provided a good cross-section of the Wichita economy and allow for the drawing of solid insights and conclusions.

In short, businesses weren’t all that concerned about the regulations themselves. Instead the guidelines and rules are sometimes less than transparent, too much focus is put on means rather than ends, and regulations aren’t equally applied across an industry…or across individual regulators. Across industries and focus group sessions the key themes were clear – give businesses transparency in what regulations are being applied, how they are employed, provide flexibility in meeting those goals, and allow an opportunity for compliance.

Almost across the board in the findings, businesses willingly adapt and comply with regulations if they are transparent and accountable. While the paper explored state regs as well, the situation in SCKS offers a chance to “reset” the regulatory framework in the region. The sales tax debate remains fresh in the mind of citizens and Tuesday’s municipal elections confirmed that job creation and economic growth remain paramount.

Individuals and communities will always land on different places along the continuum of appropriate regulation. And, a give and take will always exist between regulators and the regulated. Those two truisms, however, should do nothing to undermine the need for regulations to be applied equally, based on clear rules and interpretations, and to give each business an opportunity to comply.

This project is a starting point from which to gain insight and guide future policy debates in Wichita and Kansas. In fact, many of the business leaders who took part in the focus groups would say these same trends are evident in other jurisdictions and with federal agencies as well. Give them transparency, accountability, and space and they will set about building a business. There is sometimes very little sympathy for business owners, but let’s not forget that they employ our neighbors, help us earn a living, provide for our children, and allow us the opportunity to find meaning and dignity in work.

The staff at the Hugo Wall School was great and should be considered a vital part of the local community. The project wouldn’t have come together without their work.

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