State view: Regulatory minefield threatens business, job growth in Minnesota

Talk about it

The Minnesota Chamber of Commerce scored a significant victory at the 2011 Legislature with streamlining of the environmental review and permitting process. Welcome relief, right?

Businesses do appreciate the change in law that, among other things, specifies the Minnesota Pollution Control Agency and Minnesota Department of Natural Resources have a 150-day goal to issue permits. If they cannot, the agency must provide reasons.

Many companies remain skeptical the 150-day goal actually will improve the process. As one member said, “I’ve already been told they will reject the application as incomplete, so the 150-day goal will not begin.”

The comment reinforces findings in the annual Minnesota Business Barometer Survey co-sponsored by the Minnesota Chamber and Himle Horner Inc. Respondents identified government regulations as a significant barrier to job growth.

Businesses are not asking agencies to be less thorough in their protection of our health and the environment. We only ask for a predictable process and sensible regulations to maintain our clean environment and to foster job growth via economic development. Business owners and managers do become frustrated when a process that takes months in other states and countries can extend for years in Minnesota.

So what’s on the Minnesota Chamber’s radar for 2012? First, we must make sure the environmental review and permitting reform law is administered as envisioned. The Legislature and governor promised a streamlined process, and we need to make sure agencies carry that out. Two of five respondents in the Business Barometer said their decisions to invest in Minnesota — read: create jobs — are affected by stability and the predictability of state policies.

Second, policymakers must understand that regulatory reform affects businesses in different ways. That’s best represented by this sample of comments from members at our regional policy sessions.

“Reduce the bureaucracy; make it easier to start a business.”

“Why does it take eight years to study the need for bridge replacement in one case when the (Interstate) 35W bridge was rebuilt in two years?”

“Innovation: Good ideas discussed but didn’t go far enough at the Legislature.”

“No oversight in rule-making and implementation; that’s where many of the problems occur.”

“New regulations for elevators, spring-head locations, etc., are expensive and didn’t improve customer value.”

“Regulations need to be adaptive and flexible to the unique features of particular industries or businesses; one size does not fit all.”

The Minnesota Chamber seeks additional feedback from businesses statewide on the most important regulatory reform the Legislature and governor could make. What could the state do to make it easier to do business in Minnesota? Are there duplicative regulations between federal, state and local governments? What processes could be streamlined? Policymakers should use environmental review and permitting reform as a guide and address other regulatory burdens on a bipartisan basis.

The labyrinth of state regulations challenges companies of all sizes and types on a variety of fronts. That results in more than frustration; there’s a threat to the state’s economic vitality. One of the effects of a global economy on local businesses is a global competition for investment. Companies routinely compare all costs and regulatory requirements against other states and nations. We must take steps to level the playing field if Minnesota is to have a credible chance of nurturing economic development and creating jobs.

Joe Maher is general manager of the UPM Blandin Paper Company in Grand Rapids and is chairman-elect of the Minnesota Chamber of Commerce board of directors.

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