Ohio, a leader in cutting red tape, can do more

Ohio has been experimenting with regulatory reform as part of an ongoing effort since 2011.

Given that the program has been in place for more than seven years, it makes sense to take stock of its results and the lessons it holds, both for Ohio and for reformers across the nation.

Created by Kasich in 2011, the Ohio Common Sense Initiative exists to foster a more jobs-friendly regulatory environment. Twice a year the program provides updates. A 2017 report, for example, details how 341 rules were rescinded last year out of 2,613 that the CSI office reviewed. That’s progress.

Many additional rules have been amended, which likely lowers costs to the public further. Overall, the CSI has reviewed 12,500 rules since 2012 — of which 1,049 were repealed.

And 1,049 repealed rules isn’t bad. But what if there are 100,000 rules in total? Or 200,000? Without knowing more about how many regulations are actually on the state’s books, it’s difficult to say if the CSI has made a meaningful reduction in red tape.

The Mercatus Center at George Mason University has a project to quantify state regulations, because the total in many states is actually a mystery. Our newest report describes how the Ohio Administrative Code contains more than 15 million words. It’s so long that an ordinary person would need 21 weeks to read it, assuming 40 hours a week spent reading.

Included in these 15 million words are nearly 247,000 restrictive words like “shall,” “must” or “required” — a simple way to count up the staggering amount of commands and prohibitions in a state’s code.

Word counts and restriction counts don’t compare perfectly to the numbers in the CSI reports, but these figures nonetheless suggest a lot of room to improve Ohio’s business climate. Of the 22 state codes analyzed so far, only Illinois and New York have more restrictions than Ohio. Meanwhile, Arizona has about a quarter as much regulation as Ohio, and neighbors West Virginia, Michigan and Kentucky each have at least 100,000 fewer restrictions in their codes.

So how can Ohio demonstrate that it’s a welcoming place for entrepreneurs and innovators?

One example comes from Virginia, home of a brandnew regulatory-reduction pilot program. It tasks the state’s Department of Planning and Budget with counting up and tracking the various regulations and requirements imposed by state agencies. This simple reform is actually a big deal because it gives legislators a solid grasp of how much red tape is on the state’s books.

Additionally, the Virginia law sets a goal of reducing regulatory burdens by 25 percent at two state agencies: the Department of Professional and Occupational Regulation and the Department of Criminal Justice Services. This target is to be met in three years’ time.

Not only is the law ambitious, but it is bipartisan as well. It passed the legislature almost unanimously.

Ohio should take note. By counting and tracking how much regulation is actually in place, it is easier to assess whether reductions in red tape are actually meaningful. Moreover, an explicit reduction target tied to a concrete deadline gives policymakers a clearer goal to strive for and makes it easier to hold them accountable later on.

The Common Sense Initiative has certainly taken some good first steps, and Ohioans should be proud of its work. Before Gov. Kasich leaves office, his administration, along with leaders in the legislature, may want to consider updating their approach to keep Ohio at the forefront of regulatory reform efforts in the states.