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NFIB: Lawmakers should consider restraint

Jason Espinoza

Since last March, The National Federation of Independent Business has been conducting regular COVID-19 surveys of its members to assess the impact of the public health crisis on small business operations.

The most concerning finding is that one in four small-business owners reports that they will have to permanently close their doors in the next six months, if current economic conditions don’t improve.

Small business is the backbone of our economy and the road to recovery runs through Main Street. NFIB is asking the Legislature to support the following economic recovery proposals.

Regulatory Restraint:

Given the uncertain environment, frequent rulemakings need to be curtailed so that businesses can focus on staying viable. NFIB recommends legislation that would only allow rulemakings to proceed under an executive order should the governor find that such proposed rule changes aid in economic recovery.

Regulatory Flexibility: Small businesses need to be able to explore new ways of operating. Government should encourage such innovation, not block it. NFIB recommends amending the State Rules Act to require all state agencies to provide for exemptions and variances from such rules, so businesses can have the flexibility to pivot and thrive in unique times.

Regulatory Predictability: Government needs to ensure as much predictability as possible for small businesses. NFIB recommends legislation that ensures the uniformity of regulations, wage, and benefit mandates across the state as a mechanism to avoid a regulatory patchwork that could impede economic recovery.

Regulatory Time Frames: The administrative process should not be an obstacle to economic recovery, but rather a checkpoint in which decisions are administered and issued within reasonable time frames. NFIB recommends requiring agencies to establish reasonable time frames for issuing licenses and permits, conducting adjudicatory proceedings and inspections, and pursuing administration sanctions. Failure to establish and adhere to the time frames should result in penalties for the agencies, and in some cases trigger judicial avenues to seek relief.

Unemployment Insurance: New Mexico’s Unemployment Insurance Trust Fund is entirely funded by a payroll tax on employers. Due to the impact of COVID-19, however, thousands of individuals were laid off through no fault of the business, nor their own. Small businesses are at risk of experiencing skyrocketing rates if the solvency of the UI Trust Fund is not addressed. NFIB recommends restoring solvency to the UI Trust Fund through mechanisms that protect small businesses from skyrocketing UI tax rates.

State Fees: Many small businesses paid fees (alcohol license fees, state park concessionaire fees, etc.) to the state. However, public health orders that severely limited or completely prohibited operations curtailed many businesses from utilizing the license or benefit of the fee. NFIB recommends that all state agencies refund fees paid by businesses whose operations were impacted and restricted by the public health orders.

Liability Protections: An NFIB survey revealed that nearly 70% of small business owners are concerned about liability claims increases. NFIB recommends protecting fragile businesses from frivolous lawsuits that try to exploit the pandemic for financial gain. To ensure economic recovery, businesses need the assurance that when giving their best efforts to protect employees and their customers, that they in turn will be protected from frivolous lawsuits.

Financial Support: According to tracktherecovery.org, as of Dec. 9, 2020, total small business revenue in New Mexico decreased by 43.5% compared to January 2020. Additionally, almost half of small business owners do not expect business conditions to improve to normal levels until at least 2022. New Mexico needs to prioritize financial relief to assist small businesses. Despite the state’s anti-donation clause, the Legislature needs to push the envelope to develop innovative mechanisms to support struggling businesses.

Lawmakers have a special obligation to ensure that public policies help spur economic growth by considering the unique perspective of those who own and operate a small business in New Mexico.

The executive’s desk is a guest column providing advice, commentary or information about resources available to the business community in New Mexico.

 

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