In July, Lobbyit utilized Congress's near-total focus on health care as an opportunity to address emerging trends in other issue areas where NCISS has an interest and has been active. As NCISS members are well aware, we have long been paying attention to the issue of burdensome state occupational licensing requirements. State licensing boards, typically comprised of established industry professionals, often utilize their quasi-official status to establish a host of educational and training requirements with the primary intent not to protect public health or safety, but of protecting their incumbent status. As a predominately state-licensed profession, we have heard numerous stories from NCISS members about ludicrous requirements from states to acquire or maintain a PI license.
In 2014, we were regularly following the North Carolina Board of Dental Examiners v. Federal Trade Commission case in the U.S. Supreme Court. At issue was a state North Carolina licensing requirement bring anyone without a dentist's license from providing teeth whitening services.
Fortunately, the Supreme Court found this requirement was an illegal restraint of trade, and ruled against North Carolina Board of Dental Examiners. The Federal Trade Commission (FTC) then began receiving public input on similar state licensing requirements in preparation for investigating and suing state licensing boards where their requirements - regardless of profession or industry -- were found to be anti-competitive.
At that time, NCISS/Lobbyit met with the FTC, and was encouraged to provide pertinent examples - several NCISS members took advantage of this opportunity and reached out to the FTC. The issue somewhat languished, however, as the Obama Administration wound to a close.
Additionally, the Supreme Court decision introduced significant uncertainty into this area of law, as state licensing boards found themselves potentially liable for large class action judgments against them. Until some guidance issued from the courts or Congress, this issue was effectively frozen in place.
Recent developments, however, have re-ignited the issue.
First, during remarks to the American Legislative Exchange Council (ALEC) in Denver on July 21, U.S. Secretary of Labor Alexander Acosta encouraged state legislators to engage in principled reforms to help American workers, focusing particularly on how occupational licensing has created excessive barriers to employment.
Secretary Acosta noted that, in 1950, only about 1 in 20 jobs required a license. Today, more than 1 in 4 Americans need a license to legally perform their work. While many license requirements have valid reasons, particularly when they focus on health and safety, many parties use licensing to limit competition, bar entry, or create a privileged class.
He also stated that such licensing regimes create an economic barrier for Americans seeking a job (especially for those with fewer financial resources) and prevent Americans from moving from state to state.
Pursuant to this renewed focus, Lobbyit met with the FTC's Office of Economic Liberty to discuss how best to get our issues addressed. They ensured us that we have an open line of communication with them, and they are eager to learn of any problems or issues we might be experiencing in this area.
Second, during a meeting with Senator Mike Lee's office (R-Ut) to discuss the related legislation he introduced last year, we learned that he would soon be introducing the "Restoring Board Immunity Act," (RBIA)- "A bill to help States combat abuse of occupational licensing laws by economic incumbents, to promote competition, to encourage innovation, to protect consumers, and to facilitate the restoration of antitrust immunity to State occupational boards, and for other purposes." RBIA is now S.1649 - the House companion legislation will be introduced by Cong. Issa (R-Ca).
Lee's staff informed us that occupational licensing costs consumers $200 billion in higher costs every year and deprives an estimated three million prospective professionals of job opportunities.
With state regulatory bodies now potentially subject to anti-trust liability (and potentially large associated judgements), Lee's RBIA creates a limited, conditional exemption shielding licensing boards from federal antitrust lawsuits, but only for states that change how their licensing boards operate and how courts handle disputes between those boards and individuals subjected to their rules.
S. 1649 would give states two paths to immunity from such suits. The first by bringing state licensing boards under direct supervision by the legislative and executive branches. The second by requiring states to show why a certain licensing requirement is necessary to protect public health and safety.
Lee's office is in the process of gathering cosponsors.
Lobbyit then followed up with Senate Judiciary Committee staff to discuss the prospects for Senator Lee's legislation. The Committee is largely focused on nominations at present, but did say that they'd like to schedule hearings on S. 1649 after August recess, but before the end of the year. The White House has indicated its support for the bill, so they feel confident that it would move with minimal resistance. Committee staff asked us for examples of such onerous licensing requirements in our profession to help them support the legislation, and we promised to survey membership and report back.
NCISS encourages our members to review their applicable state licensing requirements and consider whether they exist to actually protect public health and safety, or exist more to prevent competition in our industry. Lobbyit will then present such examples to the FTC and the Senate Judiciary Committee.