ALBANY – Thousands of state regulations are potentially costing businesses in New York billions of dollars, a worsening problem that a bipartisan group of state senators says hurts the state’s job creation efforts.
“It’s an incredible maze to try to navigate,” said State Sen. Patrick Gallivan, an Elma Republican who is the Senate’s deputy Republican conference leader for economic development.
Gallivan and three other senators held hearings around the state last summer and fall, and released a report Monday that identified 2,219 rules and regulations – out of more than 750,000 regulations across all state agencies – that are in immediate need of review.
The targeted regulations stretch from an annual written notification employers must send to all workers about their rate of pay – a rule that senators estimated cost companies $180 million annually – to a mandate that certain insurance agency forms be submitted on buff-colored paper.
Gallivan said rules at some agencies compete against rules at other agencies, while the Senate commission that studied the regulations said agencies are often uncooperative with helping regulated companies through the patchwork of state rules.
The Medical Society of Erie County, for instance, noted that the state’s new prescription drug reporting regulations require that a physician’s staff must check an electronic database about a patient’s prescription drug use 24 hours before a patient’s visit; but the rules do not allow the offices to check on Friday for a Monday appointment.
A downstate apple grower told lawmakers in a hearing last fall that New York has the slowest pesticide product registration process in the nation because of state-specific regulations. A Central New York tree company owner complained New York does not allow many merchants to display live Christmas trees. Manufacturers railed against the state’s slothlike environmental review laws for new development projects, while car dealers said it takes 15 minutes of staff time for each car on their lot to comply with a rule requiring them to have a paper record ready for immediate inspection by the state.
Some of the panel’s ideas have been dead on arrival for years in Albany, such as an effort by businesses to change a law that makes contractors and property owners liable for “gravity related” injuries by construction workers regardless of whether the worker is at fault.
The Senate report comes a week after Gov. Andrew M. Cuomo in his State of the State address said his administration and the Legislature should form a commission to study the regulatory problems facing businesses.
“Let’s pledge to stop talking about it and actually get it done this session,” Cuomo said.
Gallivan said the legwork has already been finished with the release of his panel’s report Monday.
“There’s no reason for additional hearings across the state with the same people saying the same thing … We think the bulk of the work is done,” he said.
The senators said the state was ranked 35th last year by CNBC as a place to do business, one place worse than in 2012.
They said New York ranked 49th in cost of doing business – which they attribute in large part to a burdensome regulatory system.
But many of the regulations put in place by agencies were imposed by the Legislature and governors over the decades, and it will take another act of law to change them.
Each rule has its own special constituency group behind it, whether groups that want to protect the environment or workplace rights.
No one has studied the effects of New York’s regulatory climate, but the Senate report noted a 2009 examination of California’s system of rules costs the economy there an estimated $493 billion.
The Senate panel, extrapolating the California study, said New York’s rules and regulations could cost businesses $274 billion a year, which they noted is about 23 percent of the state’s economy.