New York City’s toothless effort to reduce small businesses regulations
In January, New York City Mayor Eric Adams issued his “Small Business Forward” plan, which required all city agencies to revisit and make proposals for either eliminating or reducing the fines imposed on small businesses for many of the city’s regulations that were deemed unnecessary or excessive.
As of just a few weeks ago, the recommendations – all 118 of them – are now here and in writing. And the result is underwhelming. To give credit where it’s due, I appreciate that the mayor is taking steps to make life better for his city’s small business owners. And the plan eliminates many regulations. But frankly, most of the 118 “reforms” are either reduced fines or a waiving of first violations. And even with these measures, the number of regulations that a New York City small business still faces is pretty daunting.
It’s a city (and state) that burdens its employers with new regulations that recently have increased the number of mandated paid leave days, in addition to the requirements for family, sick and paid time already mandated.
It’s a city that passed bills to restrict electronic monitoring of employees. Small businesses in New York pay the nation’s highest minimum wage ($15 per hour) and are required to predict their employees’ schedules in advance. They are fined if they don’t provide space for lactation or if they discriminate based on a person’s hair. They must also comply with some of the nation’s most complex and onerous anti-harassment rules.
So, you would think that when the mayor orders a reduction in regulations, small businesses in New York would get a relief from all of this, right? Unfortunately not. Small businesses there still face fines if they:
– Leave an exterior door or window open while an air conditioner/central cooling system is operating;
– Fail to locate a scale between a buyer and seller;
– Do not include a year-round phone number and/or address of their tax preparer on their receipts;
– Fail to properly post a permit for work at their premises;
– List “prohibited” drinks (beverages other than water, milk, fruit/vegetable juice) on a children’s meal menu;
– Have a refund policy that doesn’t state under what conditions a refund will be given or fail to post a complaint and refund sign “prominently and conspicuously”;
– Have a “dirty” sidewalk;
The list goes on.
Of course, there are many legitimate and necessary health and safety requirements that businesses must comply with, including the proper handling of food, not selling cigarettes to minors and operating a safe workplace. These are important. And I’m certainly encouraged by Mayor Adams’s effort to reduce his city’s regulations on small business, even when these reductions are, for the most part, toothless.
So, what more can be done to help New York’s small businesses? How about welcoming some of those new entrepreneurs who were among the millions of startup application filers during the past two years?
To do this, New York’s mayor needs to turn to a higher authority: the state. He and Gov. Kathy Hochul should take a hard look at the countless licensing and permit requirements that are required for anyone looking to start up or do business in New York.
Is it really necessary for interior designers to be licensed? Or an electronics store? Do you really need the state’s approval to operate a nail salon, pet store or to sell scrap metal? And why do cosmetologists, tourist guides, locksmiths, massage therapists, hair stylists, real estate appraisers and someone who provides bikini waxes need to be licensed? Why do snowmobile dealers, telemarketers, Halal certifiers and fund raisers have to register with the government?
To be a cosmetologist in New York, you’re required to complete a 1,000-hour approved course of study and pass written and practical examinations. To be a locksmith in the state, you must, among other requirements, get a “letter from Local Union No. 74 Service Employees International Union indicating successful completion of a locksmithing course at a school and one (1) Certificate Recommending an Applicant for a Locksmith License…or show evidence of other certifications.”
I mean…c’mon, guys, this is crazy. Life is about mitigating risk, and I’m pretty sure that the great majority of consumers are able to take responsibility for choosing who will do their hair or fix their locks. Will the city and state be foregoing licensing and permit fees? Yes. But by making it easier for a startup to operate in New York, the state and city will certainly benefit from the taxes generated.
Delaying penalties for innocuous infractions is toothless. Relaxing the requirements for people to independently make their livelihood in a place is the best way to support small businesses, provide jobs and nurture growth.
Gene Marks is founder of The Marks Group, a small-business consulting firm. He frequently appears on CNBC, Fox Business and MSNBC.