Banking Commerce and Insurance

Regulatory review, temporary exemption process sought

The Banking, Commerce and Insurance Committee heard testimony Feb. 14 on a bill that would create a new regulatory review program and an office within the state Department of Economic Development to act as a liaison between private businesses and state regulators.

Sen. Anna Wishart
Sen. Anna Wishart

LB1127, introduced by Lincoln Sen. Anna Wishart, would create the Regulatory Relief Office, which could review state laws and regulations that may unnecessarily inhibit new business creation or the success of established businesses, and analyze the risk to the health, safety and financial well-being of consumers related to permanently removing or temporarily waiving regulations.

The office also would administer the Regulatory Sandbox Program and create a process through which businesses could apply for a maximum 12-month demonstration waiver of licensure and state regulations related to a specific innovative offering, such as a new product or technology.

When an application is received, the office would be required to consult with an advisory committee, also created by the bill. The 11-member committee, made up of business interests, state regulators and non-voting members of the Legislature, would consult with appropriate state agencies and recommend granting or denying the waiver.

Wishart said 12 states have adopted a similar approach to reviewing outdated or unnecessary laws.

“It’s just as important for us to be looking to get rid of bad, outdated policies as it is for us to be introducing new laws,” she said.

Nicole Fox of the Platte Institute testified in support of LB1127, saying it would promote economic growth and foster innovation.

“Nebraska’s venture capital funding remains low compared to the rest of the nation. In fact, Nebraska has one of the lowest startup densities in the country,” Fox said. “To remain a vibrant place for business, the state must create an environment that better enables entrepreneurs and their companies to succeed.”

Jack Russell of the Lincoln Independent Business Association also supported the bill. He said LB1127 would make Nebraska more competitive with other states in attracting business.

“By reviewing state laws with the intention of removing unnecessary regulation, we send the right message to those looking to start a business in Nebraska,” Russell said.

Jim Macy, director of the Nebraska Department of Environment and Energy, spoke in opposition to the bill. He said state agencies already can grant a variance to a state law, and that LB1127 would create a complex and confusing regulatory system.

“We’re not aware of Nebraska’s regulatory environment posing any barrier to new companies locating in Nebraska,” Macy said.

Kelly Lammers, director of the state Department of Banking and Finance, also opposed the measure. Lammers said he supports innovation but that the bill would not provide sufficient safeguards for consumers.

“LB1127 removes the department’s ability to utilize enforcement actions that are contemplated under any specifically waived statutory section [of state law],” Lammers said.

The committee took no immediate action on the bill.

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