State Strategies to Help Businesses Launch and Expand

Innovative approaches to regulation can boost opportunities for growth

State Strategies to Help Businesses Launch and Expand
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Overview

State governments can undermine opportunities for investment and job creation when businesses spend too much time or money on inefficient regulatory processes, or when new business projects get delayed because firms don’t understand how to comply with the rules. To address this challenge, state policymakers can focus on two types of reforms. First, they can improve the efficiency of regulatory systems so businesses can comply with the rules in a less costly and time-consuming manner. Second, they can partner with businesses to increase compliance as well as economic opportunity. Together, these changes form a powerful economic development strategy by making it quicker and easier for entrepreneurs to launch a new business or bring an innovative product to market.

Policymakers often focus their efforts on trying to reduce or eliminate requirements. Increasingly, however, they are finding that business leaders are less interested in eliminating regulations outright and more interested in getting help navigating the regulatory process and receiving timely and predictable regulatory decisions. 

And businesses aren’t the only beneficiaries. When regulatory systems are functioning well, they help to maintain worker safety, protect public health, and minimize environmental pollution. They also create a more level playing field; businesses that make a good faith effort to play by the rules are not put at a disadvantage compared to competitors who take advantage of dysfunctional regulatory systems to cut corners—and costs. 

In fact, improving how states regulate has the potential to be one of the most cost-effective approaches to boosting the economy. While tax incentives—states’ primary economic development approach—cost billions of dollars a year, the results are inconsistent; better regulatory administration, on the other hand, can make government more efficient, providing savings that states can use to lower taxes or to invest in more effective programs. 

Examples of state regulatory reforms:

  • Colorado improved the permitting process that identifies the routes that trucks carrying overweight or oversize loads must take. Not only does the new system save businesses time, but it also improves public safety, as the previous system sometimes directed vehicles on unsafe routes.
  • In the course of administering regulations, Washington state helps small manufacturers select a location for a new facility, saving weeks of research and helping them open sooner.
  • Vermont launched a targeted education campaign to help craft brewing entrepreneurs comply with rules and expand more quickly.

State forays into improving regulation by increasing efficiency and partnering with businesses are still in the early stages. For example, innovative reforms that have been piloted for only one permit process need to be adopted statewide. States are also just beginning to think about how to set clear goals for, and measure the progress of, improved regulation. However, policymakers looking for a win-win approach to economic development now have a wide range of inventive and proven ideas to emulate.

States Hear From Business Leaders

When policymakers have asked businesses what states could do to improve their regulatory climate, they've heard similar answers related to greater transparency, simplicity, and efficiency.


In 2017 interviews with The Pew Charitable Trusts:


  • Colorado Governor John Hickenlooper (D) reported that “real fast, you can get traction and make a difference” by reducing the cost of compliance.1 He has implemented a statewide effort to set and achieve annual goals for reducing compliance costs for businesses.2
  • When Maryland Governor Larry Hogan (R) took office in 2015, his “primary focus was to help Maryland job creators grow, thrive, and put even more people back to work,” he said. One obstacle he identified was the negative interactions business owners had with state government. In response, an integral component of Gov. Hogan’s Regulatory Reform Commission is a customer service initiative that improves regulatory processes.3
  • In responding to dozens of requests for transparency about requirements, improving efficiency and timeliness, and providing better customer service overall, Tennessee Governor Bill Haslam (R) reported, “The process is as important as the individual regulations. I don’t know that we did away with all that many regulations; I think we came up with better ways” to administer them.4

What states can do: Improve efficiency

In 2003, the Iowa Business Council, made up of the CEOs of the state’s largest employers, met to identify short-term actions they could take to improve the economic climate. They identified slow timelines to issue environmental permits as a barrier to growth. For instance, window manufacturer Pella Corporation had to delay new product launches due to months-long air quality permit approvals. The council partnered with the state Department of Natural Resources (DNR) to map out the air-quality permit process, identify bottlenecks, and find solutions. “When we can get a new production line up and running in a shorter period of time, we can produce products and generate sales sooner,” said Karin Peterson, Pella’s vice president of human resources.5 The DNR reduced the number of steps in the review process, overhauled the form to reduce mistakes, and set up a hotline staffed by engineers who could help firms calculate air pollution levels.6 Now, air permits that used to take two months to get approved take two weeks or less and still meet the same quality standards.7

Effective private-sector companies regularly review their production systems to identify opportunities for improvement. Otherwise, inefficiency and waste can take up resources that could be better invested in quality, innovation, and expansion.

Regulatory processes are no different. When poor practices are allowed to calcify, there is an economic cost. The tools that Iowa and many other states are using to fix problems like these are the same ones used in the private sector. For example, “lean manufacturing” has been used across the world to improve how cars are built, how software is developed, and how health care is delivered. This approach lowers costs while increasing quality. 

A number of states are now using this approach to streamline regulation. In 2015, the Arizona Government Transformation Office under Governor Doug Ducey (R) held a “permit blitz” to improve how dozens of permits were administered. It brought together officials from 23 agencies to work on 40 permit processes. At the end of the project, the office reported that the decision timelines for these permits were reduced by more than 60 percent on average.8

What States Can Do to Make Regulatory Processes More Efficient:

  • Eliminate waste and correct errors by evaluating the purpose of each step in a process.
  • Prioritize enforcement to focus on business activities that pose the greatest risk to health and safety.

Eliminate waste and correct errors

Many potential sources of delay and waste appear in regulatory systems. Often, only a commonsense solution is needed. Minnesota, for example, shortened the time it takes to get a contractor license from six weeks to two weeks. One reform that improved efficiency was letting staff call the applicant to ask questions about the application instead of requiring communication by mail.9

In Ohio, trucking companies now receive their annual registrations in less than a week by applying online.10 Before 2014, they waited up to five times as long and mailed in their applications or stood in line at the commission’s central office in Columbus. The Public Utilities Commission of Ohio estimated that its new online registration system saves more than 1,600 hours of agency staff time per year and saves businesses tens of thousands of dollars by eliminating postage and printing costs.11

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Previously, when the Wisconsin Department of Natural Resources received an application for a water quality permit on the wrong form, it could take up to 12 staff members to correct the error, including issuing a refund for the fee and returning photographs by mail. In the meantime, the business could not continue its plans. Since this was happening 30 or more times each month, the delay created problems. Now, the state operates an electronic permitting portal with a decision tool that helps applicants determine which permits they need and how to apply for them. The portal also allows them to track the status of their application in real time. Now, the agency receives the wrong form only about once every six months. Processing timelines have been cut between 30 and 50 percent on average.12 

In Michigan, approval to construct new buildings was slowed down because various officials had to review 3-inch-thick architects’ plans one at a time. Architects waited to receive comments from the reviewers by mail. After receiving comments from each reviewer, architects made the necessary adjustments to their plans. Then the whole process started again. Now, the state allows the plans to be submitted online and reviewed by the various bureaus simultaneously, and comments may be sent electronically. As a result, critical projects are completed faster and at lower cost.13

The lean approach can also uncover serious errors that threaten other public priorities. Colorado improved the permitting process that identifies the routes that trucks carrying overweight or oversize loads must take. State officials cut permit processing times and fixed errors in the system that had been routing large trucks through downtown Denver at rush hour or sending wide trucks down narrow roads. The reforms, which included building an online permitting portal with real-time road conditions, improved public safety and the flow of traffic.14 No trucks have hit bridges since the portal rolled out in November 2014, and companies are using the time saved by more efficient permitting to improve their operations as well.15 “We’re executing better and safer” since the system came online, said Jeffrey Cummings, owner and president of Duffy Crane & Hauling Inc. in Henderson, Colorado.16

Prioritize enforcement based on risk

States have used some innovative approaches that target their limited resources to areas that pose the greatest risk to public safety and the environment, rather than treating all firms the same. 

For example, the Colorado Oil and Gas Conservation Commission (OGCC) focuses on inspecting oil wells based on factors including the risk to public safety. Old wells, those with histories of spills, or wells located in high-population areas are among the highest priority for review and are visited at least once per year, while others are visited less frequently. The state’s assessment of OGCC’s performance focuses in part on the inspection of high-priority wells.17

It can be challenging for states to regulate industries made up of small businesses such as dry cleaners, gas stations, and auto body shops that pose public and environmental health risks. At the same time, the small-business owners are often subject to an unpredictable inspection schedule and a lack of clarity about their compliance requirements. Rhode Island’s Department of Environmental Management has taken an evidence-based approach that decreases the health risk as well as the burden on individual business owners.

First, it identifies widespread compliance problems in an industry by inspecting a random sample of businesses. Then, the department develops outreach activities including workshops and tutorials to help businesses correct problems. Businesses are able to use these tools to certify that they are in compliance with state regulations. If, in the course of self-certifying, business owners discover they’ve violated a rule, they can submit a corrective plan in advance of the official inspection to avoid penalty.18 This approach has yielded positive results. Peer-reviewed journal articles have documented industrywide improvement in compliance among automotive refinishing facilities and businesses maintaining underground storage tanks, such as gas stations or heating oil suppliers, compared to traditional inspection-based monitoring.19 “We’ve been able to prove to ourselves over time, and through the math, that it’s worth doing and that we’re getting real results in industry sectors,” said Ronald Gagnon, chief of the Office of Customer and Technical Assistance.20

What states can do: Partner with businesses

In 2015, Hawaii policymakers set a goal to power the state from exclusively renewable sources by 2045.21 Achieving this goal rests on the success of energy projects such as solar farms, waste-to-energy converters, and hydroelectric power plants. However, the complexity of energy regulation was a barrier to entry for companies.22

To address this obstacle to the state’s conservation and economic development goals, the Department of Business, Economic Development and Tourism and the Hawaii State Energy Office worked together on a solution. The agencies created an online tool that asks renewable energy developers a series of questions about their projects, then generates a checklist of permits they will need to obtain, how long each permit approval should take, and the most efficient sequence in which to submit the applications. This saves businesses from spending hours combing through a range of sources to piece together a plan that may or may not be accurate.23

It’s been especially beneficial to early-stage businesses making a “go or no-go” decision, said David Robichaux, a renewable energy business consultant in Hawaii who regularly uses the portal to advise clients on new business ideas. “Uncertainty is the great project killer, so if the developer knows what they’re getting into, they can say with confidence, ‘yes, this is an acceptable risk’ or ‘no, this is unacceptable.’” The compliance standards have not changed, he said, but they are more understandable for businesses getting started.24

What States Can Do to Build Partnerships With Businesses:

  • Add value to businesses’ efforts by providing early-stage assistance to project proposals and helping businesses make better-informed decisions.
  • Shift the focus from finding and punishing violators to partnering with businesses to help them overcome the obstacles to compliance.
  • Provide greater predictability and help businesses navigate regulatory requirements.

Add value

Because the timing of applying for permits often coincides with major decisions, such as securing a loan or choosing a site, there is an opportunity for states to offer services that guide businesses through the regulatory process and provide assistance to projects in the first phases of development. This approach positions states to support economic growth while protecting public health and safety. 

For example, the Washington State Department of Commerce has developed a site feasibility worksheet to help manufacturing firms understand and consider all the regulatory repercussions of various site options. The tool can help calculate the number of parking spaces that would be required for a facility of a given size, for instance, and the cost if more spaces would need to be built. Especially valuable for small manufacturers, the tool helps them understand which city, county, state, and federal requirements will apply, how to navigate the various agencies, and what the estimated cost and time for fulfilling all regulatory requirements will be.25 Manufacturers who located before the tool was available have estimated it would have saved them two months of combing through city codes and agency websites to understand whether a potential site would work out.26 That time could have been spent getting started at the new location. Other tools created by the department have helped industries, including construction contractors and restaurants, with city-specific “regulatory roadmaps.”27

Another common source of confusion and frustration is that businesses must often interact with multiple departments, agencies, or levels of government before they can operate. The Indiana Economic Development Corporation (IEDC) offers two full-time navigators to help relocating or expanding businesses understand the regulatory requirements of potential locations.28 These staff set up meetings with representatives from each permitting agency to walk through specific steps and create a project timetable. The IEDC assistance provides certainty to businesses that they can get products to market on a predictable timeline and comes at a low cost to the state, said Devin Hillsdon-Smith, director of interagency affairs and redevelopment at IEDC. “If we can help a company save dollars in their operating cost by just helping them navigate the regulatory processes in a more efficient manner, and if we can add that value to them without having to offer additional incentives, I think that’s a win for everybody,” Hillsdon-Smith said.29 

Businesses considering complex development projects in New Jersey can sit down with technical experts from the Department of Environmental Protection to identify obstacles that could trip up their proposed projects before submitting a permit application. Not only is this an effective way to minimize the environmental impact of new development, but the practice is good for the state’s economy as it helps ensure that projects planned for New Jersey go forward.

In a recent meeting, for example, the agency informed a company that its planned construction would be in a flood zone.30 It helped the company understand relevant regulations and estimate the cost of building to the standard required in a flood zone. As a result, the company was able to change locations before spending any more time or money on a plan it may have abandoned in the end. Large projects are assigned a permit coordinator to guide the business from idea development through opening. The coordinators help business owners navigate regulatory requirements, including connecting them with other state, local, and federal agencies.31

Illinois leaders wanted to make the state a destination for entrepreneurs working with digital currency and other financial technology. To support new ventures in the growing industry, the Illinois Department of Professional and Financial Regulation now meets with startups to hear how regulations affect the industry and to offer one-on-one guidance on the regulatory impacts of potential business ideas.32 The meetings are one part of the state’s Financial Innovation Initiative, which involves efforts from multiple state and county agencies to “help people understand what they have to do to get going in a compliant manner,” said Bryan Schneider, secretary of the Illinois Department of Financial and Professional Regulation.33

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Help businesses comply

Traditionally, regulators primarily interact with businesses only after regulators have identified a violation at a facility and imposed a citation or fine. But some states are dedicating resources to preventing potential violations before they cause harm and quickly resolving problems when they do happen. The Arizona Department of Environmental Quality (ADEQ) estimates that shifting its focus from enforcement to assistance has helped companies return to compliance 40 percent faster. This helps keep business operations running without disruption. And “the environment benefits from resolving compliance conditions as quickly as possible [or] if you help facilities not have the violation in the first place,” said Misael Cabrera, ADEQ director.34

In some cases, this assistance requires just practical thinking about a problem. In Arizona, approximately 40,000 vehicles come to emissions tests with faulty gas caps each year. Now, instead of failing the vehicles and requiring owners to spend time fixing the caps and returning for another test, the agency replaces the caps for free. The gas caps cost $5 per vehicle, but replacing them prevents the vehicle from leaking up to 22 gallons of gasoline a year.35

State leaders can work to shift the culture of regulatory agencies toward helping businesses succeed and away from simply documenting violations and assessing fines. In Missouri, for example, Department of Natural Resources Director Carol Comer described a meeting she had with a rural Missouri trailer manufacturing plant that had been repeatedly fined for improper management of hazardous waste. The plant had hired an environmental engineer to help it correct the problem but wasn’t getting all the details right. The plant owners knew they needed help but were afraid to ask the state for fear they would receive even greater fines. However, the agency is placing an increasing emphasis on helping businesses in this situation and provided the company with clear guidance on how to fix the problem. “This was a company that genuinely wanted to comply but did not have the knowledge and sophistication to do so,” Comer said. “We need to give them a chance to comply before we start hammering away with enforcement.”36

Similarly, Ohio’s Environmental Protection Agency has a compliance assistance team that provides free, customized, and confidential support to help businesses become compliant and stay that way.37 For example, Ohio’s program helps small businesses complete complicated emissions calculations that determine whether a business needs air quality permits to operate, and if so, which ones. The free consultation would otherwise be out of reach for small businesses with limited resources and helps the agency prevent future noncompliance through education.38 “It’s not that we don’t have [enforcement] tools and we won’t use them,” said Craig Butler, director of the Ohio Environmental Protection Agency. “It’s just not the first arrow that you take out of the quiver when you’re trying to solve a particular issue or a problem.”39

Working with compliance assistance officials upfront can save businesses from making costly mistakes. A manufacturing firm in rural Iowa reached out to the state’s small business environmental assistance program before embarking on a major expansion of its plant and operations. The office pointed out that the company’s plans didn’t adequately account for safe disposal of the contaminated water and chemicals that the expansion would generate. Because the office caught this oversight before building, the business was able to place the required tank under the new building during construction. Otherwise, it would have had to correct the problem after the fact, which would have meant a significant cost and a setback to these plans.40

Increase predictability

Sometimes, businesses can run afoul of rules or spend an unnecessary amount of time waiting for a decision because they don’t have easy access to the information and guidance they need to be successful. States are addressing unclear and confusing regulatory systems by helping businesses navigate regulatory requirements. As a result, businesses can better predict the requirements they will face at each stage of development and plan their growth based on accurate information. 

One important source of uncertainty comes from having to navigate requirements from multiple agencies. In Utah, most new businesses must register with at least three state agencies: the Tax Commission, the Department of Commerce, and the Department of Workforce Services. In addition, they must deal with local agencies before they can operate.41 To help, the state has assembled information in an online portal where business owners can access information as well as file required paperwork with different agencies in the same place. The portal also uses “self-correcting forms,” which won’t let a business owner move forward with the application if there’s a mistake. In addition to saving time for businesses, the Utah OneStop portal also standardizes business information across agencies. And through its “live-chat” feature, the portal directs users’ questions to the appropriate agency, saving staff time that would have otherwise been spent redirecting callers.42 

Technology can also help provide transparency on where companies are in the regulatory process. Before Rhode Island put local and state building permits online, homebuilders and inspectors had no way to know if their building plans had been received and when they would get a response, said Harold Raup, a building plan reviewer for manufactured homes at PFS Corporation, a Wisconsin-based manufactured building inspection and certification company that works with builders in multiple states.43 The Rhode Island Building Code Commission required builders to mail in five copies of their 200-page building plans, and the plans were sometimes lost, either in the mail or within the commission offices. Now, Raup uploads one set of files to the state’s online portal, which sends emails when the file is received, reviewed, and approved, and sends the final approval certificate to the regulatory agencies in the municipalities where the newly manufactured homes will be constructed. The process gives builders certainty on where they stand with the state, Raup said, so they can better plan for future projects.44

Of course, technology isn’t always the answer. Some states proactively and personally reach out to businesses and industries to help them avoid common regulatory pitfalls. This education can be particularly valuable for startups, which often lack the experience and staffing to correctly navigate state regulatory structures. 

In Vermont, the Department of Environmental Conservation noticed that newly created craft breweries were increasingly running afoul of regulations. Craft brewers, along with financial technology, dairy facilities, and homebuilding, were a target industry in the statewide strategy of Governor Phil Scott (R) to grow the economy, so improving compliance would meet an economic as well as an environmental goal.45 The agency recognized that violations primarily occurred because the brewers were hobbyists before they were entrepreneurs and did not understand the effects of a larger brewing operation on their septic systems or the environment in general. Department staff developed an education campaign and met with groups of brewers to outline the regulations, the purpose of the rules, and how to be compliant.46 “We’re seeking to change the culture in Vermont to treat our citizens and those doing business with the state government as customers, and assist them in any way we can, while following regulations,” Gov. Scott said.47

What states can do: Measure and maintain progress

States could further improve the effectiveness of these reform efforts by setting statewide goals and ensuring that progress is maintained.

What States Can Do to Set Measurable Goals and Maintain Progress:

  • Set statewide goals for improving regulatory administration that will benefit both economic growth and the state’s regulatory objectives.
  • Plan how improvements will continue in future administrations, potentially including a legislative strategy and building support among businesses.

Set statewide goals

States should set goals to make regulatory administration more efficient and partner with businesses for economic growth. With leadership from the governor’s office, these goals can be a guidepost for all state agencies. They can also inform the public about government’s priorities and progress. 

A goal-driven focus to help businesses succeed should not come at the cost of other public priorities. A strategy that emphasizes a partnership with businesses can improve how agencies respond to potential crises and opportunities. When dealing with a public health danger, for example, some states are finding that investing in education and assistance efforts is more effective than solely focusing on enforcement measures.

A goal-driven focus would also help agencies identify and correct instances where the cost of compliance is unnecessarily high because of wasteful and inefficient application processes. Fixing these problems would not require loosening the rules. In fact, by making compliance easier and cheaper, states have found that more businesses follow the rules.

Without careful planning, a focus on economic development could create unproductive incentives in regulatory agencies (such as speeding up permit processes by giving applications only a cursory review). This kind of practice would be detrimental to public health and safety. States need to consider ways to avoid this problem and help agencies focus on reforms that are beneficial both for businesses and for the state’s regulatory objectives. 

A few states have set goals to improve regulatory administration and have worked to achieve them. In Colorado, agencies set annual goals for reducing compliance costs for businesses without compromising public health, safety, or the environment.48 After working on improvements, they report on how much money or time they have saved businesses. In 2017, agencies reported saving businesses 2.3 million hours, largely by eliminating unnecessary administrative tasks and making the experience more user-friendly. The businesses can now put those hours to better use.49

The efficiencies can also improve public health and safety. For instance, before implementing a web-based inspection system, when a Colorado Department of Agriculture inspector believed that tainted animal feed was being sold to farmers, the issue could not be resolved until a paper report was mailed to Denver, reviewed, and mailed back. The feed processor would be in limbo awaiting a decision, farmers would continue to buy and use the adulterated feed, and public health was at risk. Now, inspectors file a report electronically at the site through a new online portal. It can be reviewed and approved by the agency within minutes, halting businesses’ production immediately and protecting animals and the public from further exposure.50

Internationally, a number of countries have taken this approach a step further by setting nationwide goals to cut business costs. They have accomplished these goals not by eliminating rules but by reducing the amount of required paperwork, increasing access to information, and moving permit and license processes online.

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For example, the British government set a goal in 2005 to reduce administrative burdens on businesses by 25 percent over five years without lowering health and safety standards.51 By 2010, the government had exceeded its goal and reported that agencies had reduced costs to businesses by about 3.5 billion pounds. The departments achieved much of their success by improving how they interacted with businesses, such as redesigning forms so that they were easier to fill out, putting permit applications online and creating regularly updated, clear compliance instructions. For instance, training guides to help landlords understand the exact steps they needed to take to comply with gas safety rules saved property owners 60 million pounds in compliance costs.52 Allowing insurance companies to issue proof of insurance to customers electronically saved them about 12 million pounds each year in printing, processing, and postage costs.53

Maintain progress

Regulatory operations cannot be improved overnight. Even a newly fixed process will need to be reviewed and adjusted again in the future. Without an ongoing commitment, the benefits of this approach will not materialize. In addition, any economic development tool will be ineffective if business leaders do not have confidence that it will continue.

Many of the regulatory improvement efforts highlighted here are less than 10 years old and implemented entirely through the executive branch. In order for states’ investments to be successful, they need to consider how to ensure that progress will continue in future administrations. Colorado has addressed this concern by codifying many of its key approaches.54

Businesses can also work to ensure that these efforts are sustained. In Iowa, the business community successfully lobbied the Legislature to create an office focused on process improvement in state government. Business leaders have played a leading role in ensuring that this effort has continued through three administrations.55

Conclusion

Regulatory improvement is a promising economic development strategy. Numerous states are proving that, by administering rules more efficiently and partnering with the private sector, they can substantially lower compliance costs for businesses while simultaneously achieving important goals such as protecting the environment and public health. These efforts, however, are still largely in their infancy. In many states, one or two agencies have adopted reforms, but others have not.

States would benefit from a more consistent, long-term approach. Policymakers can commit to improving regulatory processes and outcomes over time, set goals for the progress they will make, and then monitor whether these goals have been achieved. In doing so, states will help businesses to open, expand, and thrive, leading to more vibrant economies.

Endnotes

  1. Governor John Hickenlooper, interview with The Pew Charitable Trusts, Aug. 15, 2017.
  2. Colorado Performance Management & Operations, “Cut the Burden of Government Regulations,” accessed May 21, 2018, https://www.colorado.gov/pacific/performancemanagement/cut-burden-government-regulations.
  3. Governor Larry Hogan, interview with The Pew Charitable Trusts, July 26, 2018.
  4. Governor Bill Haslam, interview with The Pew Charitable Trusts, Aug. 15, 2017; Tennessee Department of Economic & Community Development, “Regulatory Reform Report,” accessed May 21, 2018, https://www.tnecdit.net/WebFiles/Transparency/ECD%20Reports/010612%20Regulatory_Reform_Report.pdf.
  5. Karin Peterson (vice president of human resources, Pella Corporation), interview with The Pew Charitable Trusts, July 13, 2017.
  6. Sarah Piziali (environmental program supervisor, Iowa Department of Natural Resources), interview with The Pew Charitable Trusts, Sept. 22, 2016.
  7. Peterson interview.
  8. Arizona Government Transformation Office, “Annual Report” (2015), https://ams.az.gov/sites/default/files/Arizona%20GTO%20Transformation%20Report%202015.pdf.
  9. Jessica Looman (former deputy commissioner, Minnesota Department of Labor and Industry), interview with The Pew Charitable Trusts, March 17, 2017.
  10. Milan Orbovich (director, Transportation Department, Public Utilities Commission of Ohio), interview with The Pew Charitable Trusts, Jan. 1, 2018.
  11. Ibid.; LeanOhio, “Motor Carriers Will Receive Needed Credentials up to 80% Faster,” accessed April 16, 2018, http://lean.ohio.gov/Results/PUCO_MotorCarrierReg_Jan2014.aspx; LeanOhio, “PUCO Motor Carrier Registration,” accessed June 14, 2018. http://lean.ohio.gov/Portals/0/docs/reportouts/PUCO_MotorCarrierReg_ReportOut_Jan2014.pdf.
  12. Marjorie Damgaard (section chief, Technology Services, External Services Division, Wisconsin Department of Natural Resources), interview and email correspondence with The Pew Charitable Trusts, Jan. 26, 2018.
  13. Shelly Edgerton (director, Michigan Department of Licensing and Regulatory Affairs), interview with The Pew Charitable Trusts, May 24, 2017; Jason Moon, (communications director, Michigan Department of Licensing and Regulatory Affairs), email message to The Pew Charitable Trusts, March 17, 2018.
  14. Gary Vansuch (director of process improvement, Colorado Department of Transportation), interview with The Pew Charitable Trusts, Feb. 22, 2017.
  15. Colorado Department of Transportation, “COOPR: Major Enhancement for Customers for Oversize/Overweight Permitting,” news release, Jan. 14, 2016, https://www.codot.gov/business/process-improvement/using-information-technology-to-improve-processes/coopr-major-enhancement-for-customers-for-oversize-overweight-permitting.
  16. Jeffrey Cummings (president, Duffy Crane & Hauling, Inc.), interview with The Pew Charitable Trusts, March 1, 2018.
  17. Tobin Follenweider (chief operating and performance officer, Colorado Department of Natural Resources), interview and email correspondence with The Pew Charitable Trusts, July 28, 2017; Colorado Oil & Gas Conservation Commission, “Well Inspection Prioritization” (2016), http://cogcc.state.co.us/documents/library/Technical/Risk_Based_Inspections/Well_Inspection_Prioritization_Summary_5_12_2016.pdf.
  18. Rhode Island Department of Environmental Management, “Environmental Results Program,” accessed May 11, 2018, http://www.dem.ri.gov/programs/customertech/environmental-results.php.
  19. Richard T. Enander et al., “Environmental Health Practice: Statistically Based Performance Measurement,” American Journal of Public Health 97, no. 5 (May 2007), doi:10.2105/AJPH.2006.088021, https://ajph.aphapublications.org/doi/abs/10.2105/AJPH.2006.088021; Richard T. Enander et al., “Reducing Drinking Water Supply Chemical Contamination: Risks From Underground Storage Tanks,” Risk Analysis 32, no. 12 (May 2012), https://onlinelibrary.wiley.com/doi/pdf/10.1111/j.1539-6924.2012.01843.x
  20. Ronald Gagnon (chief, Office of Customer and Technical Assistance, Rhode Island Department of Environmental Management), interview with The Pew Charitable Trusts, June 15, 2017. 
  21. Hawaii H.B. 623 (2015), https://www.capitol.hawaii.gov/session2015/bills/HB623_CD1_.htm.
  22. Cameron Black and Veronica Rocha (energy analyst and renewable energy program manager, respectively, Hawaii State Energy Office), interview with The Pew Charitable Trusts, Oct. 16, 2017.
  23. Hawaii State Energy Office, “Renewable Energy Permitting Wizard,” accessed April 17, 2018, http://wizard.hawaiicleanenergyinitiative.org/.
  24. David Robichaux (principal, North Shore Consultants, LLC), interview with The Pew Charitable Trusts, Feb. 22, 2018.
  25. Washington Department of Commerce, “Regulatory Roadmaps for Washington Businesses,” accessed April 17, 2018, http://www.commerce.wa.gov/growing-the-economy/business-services/regulatory-roadmap/.
  26. Harvard Kennedy School Ash Center for Democratic Governance and Innovation, “2017 Innovations in American Government Awards Semifinalists,” accessed April 17, 2018, https://www.innovations.harvard.edu/2017-innovations-american-government-awards-semifinalists.
  27. Washington Department of Commerce, “Regulatory Roadmaps.”
  28. Indiana Economic Development Corporation Regulatory Affairs Division, “Regulatory Assistance Program,” accessed on April 17, 2017, https://iedc.in.gov/programs/regulatory-affairs.
  29. Devin Hillsdon-Smith (director, Interagency Affairs and Redevelopment, Indiana Economic Development Corporation), interview with The Pew Charitable Trusts, Jan. 19, 2018.
  30. Megan Brunatti, Ruth Foster, and David Pepe (environmental specialist, acting director, and supervisor, respectively, Office of Permit Coordination and Environmental Review, New Jersey Department of Environmental Protection), interview with The Pew Charitable Trusts, Sept. 13, 2017.
  31. David Pepe (supervisor, New Jersey Department of Environmental Protection), email message to The Pew Charitable Trusts, Sept. 13, 2017.
  32. Illinois Department of Financial and Professional Regulation, “Illinois Regulator Launches Guidance Initiative to Drive Fintech Innovations,” news release, April 26, 2017, https://www.idfpr.com/News/2017/4262017IlRegulatorLaunchesGuidanceInitFinTech.asp
  33. Bryan Schneider (secretary, Illinois Department of Financial and Professional Regulation), interview with The Pew Charitable Trusts, July 18, 2017.
  34. Misael Cabrera, (director, Arizona Department of Environmental Quality), interview with The Pew Charitable Trusts, April 19, 2017.
  35. Erin Jordan (public information officer, Arizona Department of Environmental Quality), interview with The Pew Charitable Trusts and email correspondence, June 7, 2018; Office of the Arizona Governor Doug Ducey, Arizona Management System, “Vehicle Emissions Testing,” accessed on June 4, 2018, https://ams.az.gov/vehicle-emissions-testing.
  36. Dru Buntin, Carol Comer, Colette Weckenborg, and Ed Galbraith (deputy director, director, continuous improvement and performance coordinator, and director of division of environmental quality, respectively, Missouri Department of Natural Resources), interview with The Pew Charitable Trusts, Sept. 22, 2017.
  37. Ohio is one of many states with an active Small Business Environmental Assistance Program. The Clean Air Act Amendments of 1990 required states to develop programs to help small businesses understand and comply with Clean Air Act regulations.
  38. Ohio Environmental Protection Agency, “Office of Compliance Assistance and Pollution Prevention,” accessed on April 21, 2018, http://www.epa.ohio.gov/ocapp/ComplianceAssistanceandPollutionPrevention.aspx.  
  39. Craig Butler (director, Ohio Environmental Protection Agency), Brent Goetz and Dan Sowry (former supervisor and assistant chief, respectively, Division of Environmental and Financial Assistance, Office of Compliance Assistance and Pollution Prevention, Ohio Environmental Protection Agency), and Laurie Stevenson (deputy director for business relations, Ohio Environmental Protection Agency), interview with The Pew Charitable Trusts, May 26, 2017.
  40. Dan Nickey (associate director, Iowa Waste Reduction Center, University of Northern Iowa), interview with The Pew Charitable Trusts, June 8, 2017.
  41. Utah.gov, “OneStop Online Business Registration,” accessed on April 19, 2018, https://secure.utah.gov/osbr-demo/welcome.html.
  42. Kelvin Hulet, Michael Rice, Brad Tanner, and Sara Watts (product manager, director of marketing and operations, marketing executive, and general manager and president, respectively, Utah Interactive), interview with The Pew Charitable Trusts, Sept. 6, 2017.
  43. Harold Raup (plan reviewer, PFS Corporation), interview with The Pew Charitable Trusts, Feb. 12, 2018.
  44. State of Rhode Island, “E-Permitting Portal,” accessed on April 19, 2018, http://permits.ri.gov/; ibid.
  45. Office of Governor Phil Scott, “The Scott Administration’s First 100 Days,” accessed on May 22, 2018, http://governor.vermont.gov/sites/scott/files/documents/100%20Days%20of%20Action_v.2.pdf
  46. Peter Walke (deputy secretary, Vermont Agency of Natural Resources), interview with The Pew Charitable Trusts, July 24, 2017.
  47. Governor Phil Scott, interview with The Pew Charitable Trusts, April 24, 2018.
  48. State of Colorado, “Cut the Burden Scorecard,” accessed on May 21, 2018, https://docs.google.com/spreadsheets/d/19q1BwevRpLOgA8I7ZQaWiUay5-1fethEqT5ODLF0cUU/edit#gid=777991777.
  49. Colorado Performance Management and Operations, 'Cut the Burden.'
  50. Hollis Glenn (division director, Inspection and Consumer Services, Colorado Department of Agriculture) and Jennifer Gurr, Kate McRoy, and Rich Medina (chief administrative officer, process improvement manager, and IT director, respectively, Colorado Department of Agriculture), interview with The Pew Charitable Trusts, May 17, 2017.
  51. Jitinder Kohli (managing director, Deloitte Consulting), written statement to the U.S. House Oversight and Government Reform, Subcommittee on Health Care, Benefits, and Administrative Rules, Oct. 24, 2017, https://oversight.house.gov/wp-content/uploads/2017/10/Kohli-Deloitte-Statement-Reg-Task-Forces-10-24-need-TnT.pdf.
  52. U.K. Department for Business, Energy, and Industrial Strategy, “Simplification Plans 2005-2010 Final Report,” (July 2010), 14, https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/31630/10-1083-simplification-plans-2005-2010-final-report.pdf.
  53. Ibid., 26.
  54. Lauren Larson, (director of state operations, Colorado Office of the Lieutenant Governor and Chief Operating Officer), email message to The Pew Charitable Trusts, May 30, 2018.
  55. Teresa Hay McMahon (executive director, Iowa Lean Consortium), interview with The Pew Charitable Trusts, July 21, 2017.
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How Reinventing Regulation Can Boost Economic Growth

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Improving regulatory processes can be a powerful and cost-effective economic development strategy for states. According to research by The Pew Charitable Trusts, two reforms have the strongest potential to boost state economies: First, states can make it less costly and time-consuming for businesses to comply with regulations. And second, they can partner with businesses to increase compliance and create economic opportunities.

State tax incentives
State tax incentives
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Improving Tax Incentives for Jobs and Growth

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Tax incentives—including credits, exemptions, and deductions—are one of the primary tools that states use to try to create jobs, attract new businesses, and strengthen their economies. Incentives are also major budget commitments, collectively costing states billions of dollars a year. Given this importance, policymakers across the country increasingly are demanding high-quality information on the results of tax incentives.

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Best Practices for Improving Fiscal Management

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Best Practices for Improving Fiscal Management

The Pew Charitable Trusts' states' fiscal health project studies the budget and economic challenges facing states and helps them design targeted, evidence-based solutions. The project addresses four policy areas: strengthening economic development tax incentives; building effective budget reserves; ensuring that debt is affordable; and evaluating municipal finances.