Tennessee is a top 15 state for burdensome licensing practices.
NFIB Leading Charge to Remove Barriers to Entry into Professions
Tennessee is recognized by many as a pro-business state, but one significant area of opportunity is reducing industry protectionism.
According to the Institute for Justice’s 2012 License to Work study, Tennessee is the 13th “most broadly and onerously licensed state.” Our state licenses 53 of the 102 low- to middle-income occupations studied, at an average fee of $218, requiring an average 222 days of education.
“NFIB strongly supports consumer protection, but industry protectionism must be addressed in Tennessee,” NFIB/Tennessee State Director Jim Brown said. “Several leaders have stepped up to say enough is enough, let’s find ways to help more people pursue their dreams without unreasonable costs and barriers.”
Brown said House Speaker Beth Harwell (Nashville), Senate Government Operations Chairman Mike Bell (Riceville), House Government Operations Chairman Jeremy Faison (Cosby), and Rep. Martin Daniel (Knoxville) are some of the leaders emphasizing reforms are needed. The Haslam administration and many inner-city Democrats also have indicated stronger interest this session in supporting a complete review of unnecessary licensing.
The following bills were defeated or delayed in 2016 in part because of NFIB efforts:
HB 2315 (Parkinson)/SB 2324 (Kyle): Would require continuing education for cosmetologists, manicurists, aestheticians and natural hair stylists, some of whom already receive up to 1,500 of education and must pass two exams before they can receive a license.
HB 2111 (Swann)/SB 1976 (Massey): Would enact the Limited Licensing HVAC Contractors’ Act, requiring persons doing HVAC work under $25,000 to obtain a license. Proponents have not demonstrated the public is being harmed, and remedies already exist for misrepresentation of work and fraud. The bill also would have made practicing without a license a Class A misdemeanor, possibly sending a small handyman to jail for almost a year.
HB 2615 (Moody)/SB 1978 (Massey): Would require the licensure of persons engaged in lactation care and services, even though the Department of Health has not received any complaints about any of the nearly 1,000 professionals who certify in this field. Tennessee would have become the first state to license this profession exclusively.
HB 927 (Powers)/SB 901 (Overbey): Would require any person repairing or replacing a roof system, costing between $3,000–$25,000, to be licensed as a home improvement contractor. NFIB argued the insurance industry has rooted out many bad actors through better claim reviews, complaints are down significantly, and consumer costs would increase with fewer roofers bidding on jobs.
In 2014, NFIB helped amend HB 2441/SB 2459 to ensure thousands of executive coaches, life coaches and other professions would not be subject to laws and rules governing psychologists, which would have triggered significant education requirements and fees.
Time for Offense
NFIB has joined the Beacon Center of Tennessee and Americans for Prosperity/Tennessee in supporting HB 2201 (Daniel)/SB 2469 (Green, Johnson), the Right to Earn a Living Act. This important reform, which was advancing through Senate and House committees at the end of session, would help increase legislative and executive oversight of entry regulations to ensure they are:
Required by state or federal law
Necessary to protect the public health, safety, or welfare or to protect the public against fraud or economic harm
Do not unnecessarily inhibit competition or arbitrarily deny entry into a market, business, trade profession or occupation
If the bill becomes law, the government operations committees will require periodic reviews of entry regulations for all occupations by boards and committees, beginning in late 2016. In addition, the governor or the commissioner of any department would be able to request the chairs of the government operations committees to review, at the committees’ discretion, specified entry regulations.
“It’s time to play less defense and more offense in the licensing arena,” Brown said. “Some of our fees are double the national average. We’re licensing people who shampoo hair with 70 days of training at fee of $140. We’re requiring pest control applicants to have four years of training and weed killing professionals to pass a 100-question test, with a 60 percent failure rate. The locksmith profession has seen a steady decline in licensed professionals. With fewer competing for business, costs rise and are passed on to consumers. It’s time for change.”