LB299 – Occupational Board Reform Act

Good afternoon, Chairman Murante and members of the Government, Military and Veteran Affairs Committee.  My name is Nicole Fox, and I am the Director of Government Relations for the Platte Institute for Economic Research.  I’d like to thank Senator Ebke for introducing LB 299.  I am here today to testify in support of this bill.

Nebraska faces a workforce shortage, and occupational licensing creates a significant labor force issue.  Currently nearly 200 different occupations in Nebraska require a government license, affecting nearly 1 in 4 workers.  This is negatively impacting small businesses trying to hire employees, potential entrepreneurs wanting to start a business and individuals seeking a means to earn an honest living.  A component unique to LB 299 that differs from other occupational licensing reform bills introduced this year is how it includes provisions to address occupational licensing issues of those with a criminal record so that they may be able to more easily enter the workforce.  Reform of occupational licensing laws to lessen burdensome regulation is an economic issue that needs to be addressed.

Occupational licensing laws were initially created as a means of protecting the public from negligent and unqualified practitioners, but more and more, instead of protecting the public from harm, we now understand that occupational licensing is making it difficult for new workers to enter the workforce.  For those individuals wanting to move to Nebraska from another state, they often must seek additional education despite having a license in another state in good standing.  LB 299 suggests using the least restrictive means of occupational regulation in Nebraska’s current and potential future regulatory efforts.  What will need to be evaluated with current occupational licenses is whether the licenses we have are truly needed to protect the public, or instead if certification or registration would be more appropriate to demonstrate that a minimum level of competency has been achieved in order to obtain an entry-level position in a given field.

Occupational licensing costs money and some will even describe these costs as a tax to be able to enter the workforce.  For some individuals and families, the cost of tuition to meet educational requirements associated with occupational licensing creates significant financial barriers. 

For small businesses, the fees charged for occupational licensing are often used to pay government workers to do the work that employers could do themselves.  An example of this would include background checks.  This extra “paper pushing” costs money.  Often the cost is passed on to consumers by raising the price of goods and services.  A study by the Heritage Foundation showed that occupational licensing reform could save Nebraska households over $900 annually.

Occupational licensing also costs time.  For workers, that time comes in the form of months and even years to complete minimum education requirements, and this is time that those individuals could be working.  For businesses, it means delays that must be endured while waiting for the inefficient government paper pushing, time invested to find qualified workers and decreased productivity and profit when job positions remain open. 

LB 299 encompasses 3 key components to help make Nebraska’s job licensing requirements less cumbersome and more competitive with our neighboring states, so that we keep individuals from leaving our state in search of work elsewhere.

• First, it provides for a sunrise process to evaluate legislation that proposes new occupational licenses.
• Second, it provides for a sunset process to evaluate existing occupational licenses.
• Third, it provides for a process for those who have served jail time for a criminal offense to be able to undergo a process to get a determination as to whether the criminal history would be a disqualifier from obtaining an occupational license. 

 LB 299 accomplishes not only a reduction of bureaucratic red tape for Nebraska workers, it also decreases the current size of government and aims to halt the growth of government in the future.

The Platte Institute for Economic Research strongly supports occupational licensing reform as a means of lessening burdens to those trying to enter the state’s workforce.  Again, thank you Senator Ebke for your leadership on this important bill.  I ask that you advance LB 299 out of committee.

Thank you for the opportunity to testify today.  I am happy to answer any questions the committee may have.