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Less Red Tape-At A Price
"The whole idea of her business was there was no grease used," says her son, state Sen. Rick Dantzler, D-Winter Haven. "It was just one of those frustrations a lot of people experience when they're trying to get permits."
Now the state's corpulent body of rules will be going on a diet of its own. Complaints like Mrs. Dantzler's finally produced legislative action this year on red-tape reform, after a similar effort last year fizzled. The new law, which goes into effect October 1, could have a broad impact on business, analysts say, by slowing the growth of new rules and making it easier to avoid existing ones. Most notable is a new provision that allows businesses to bend overly restrictive rules by obtaining a variance or waiver from the state. (A variance is a modification of a rule's application, while a waiver is a decision not to apply the rule at all.) To qualify for either one, applicants will have to show only two things: first, that the rule creates a hardship or unfairness in the way it's being applied; and second, that an alternative course of action will accomplish the rule's purpose.
"I don't care how good a rulemaking you do, you can't anticipate all the technological changes and changes in circumstances," says Wade Hopping, a top Tallahassee lawyer who helped shape the legislation. "One size does not fit all." "We just believe the new law will give an unprecedented level of access to the citizens," says Dan Stengle, who serves as Gov. Chiles' deputy chief of staff. "It was time for a revision."
Developers and builders could be among the biggest beneficiaries of the law because of the dense thickets of rules that have grown up around their business. But lots of business people could gain from the new flexible approach.
"Almost everyone has a story," says Donna E. Blanton, a Tallahassee lawyer who staffed a 1995 red-tape study commission.
During the 1996 legislative session, the waiver-and-variance provision became the key to passage of the red-tape reform bill. Chiles vetoed a similar measure in 1995, largely because it lacked the flexibility he wanted agencies to have in applying rules. As FLORIDA TREND reported ["Tears Of The Crocodile," June 1995], some lawyer-lobbyists proved surprisingly reluctant to do away with the state's existing rulemaking machinery, in part because more hard-and-fast rules gave them more ways to challenge agency programs in court. They viewed the governor's proposal - allowing agencies to operate without rules using flexible, unannounced policies - as too risky. So they killed it during the 1995 session.
This year, Hopping and other high-profile lobbyists came up with the waiver-and-variance plan, modeled on a more modest provision in Minnesota law. In contrast to Chiles' 1995 plan, which gave discretion to the agencies, the new law places more power in the hands of regulated entities, by forcing the agencies to grant waivers and variances if the applicants meet the basic criteria. "Nobody has anything like this in the country," says Blanton. "I think a lot of people will be watching it to see how it works."
Among the noteworthy changes in the law are several that will make it easier to challenge rules. Some also will enrich lawyer-lobbyists such as Hopping, while costing the taxpayers. The changes include:
New agency rules will carry no legal presumption of validity, making them easier to overturn in court.
Agencies must have specific authorization from the Legislature to adopt rules on a given subject, instead of the blanket authority they often have relied on in the past. That provision alone would have made a huge number of existing state rules vulnerable to attack if the Legislature hadn't grandfathered those rules in until 1998. In the meantime, agencies will be scrambling to figure out which of their existing rules lack specific legislative authorization.
Lawyers will be able to collect fees from agencies for successful challenges to new and existing rules.
Lawyers even will be able to collect fees for successfully claiming that agencies failed to adopt rules they should have adopted.
Losers in state bid competitions will have a much easier time winning their challenges, thanks to changes in the legal standard for reviewing agency decisions.
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New Script?
Agency regulations even bug some agencies, to judge from recent actions of the Florida Entertainment Commission.
The commission, which promotes movie, TV and music production, has been picked at for its bookkeeping practices by state bean counters. It has also become the persistent target of a self-styled whistle-blower.
As a result, as of midsummer the state-sponsored public-private partnership was considering converting to private nonprofit status, largely to reduce the scrutiny it faced.
"We were in an operational nightmare," says FEC chairman Seth Gordon, a Miami public relations executive. "It was the worst of all possible worlds."
As part of its reincarnation, the agency also was considering a joint venture of sorts with the Florida Association of Broadcasters (FAB), a Tallahassee trade group that represents TV and radio stations and networks in Florida. That joint venture could involve bringing some FAB executives and directors on board, or could begin with less formal connections, Gordon says.
The broadcasters group would bring more managerial savvy to the tiny FEC, Gordon says. The union also would pump up the FEC's core political constituency, which many in Tallahassee now perceive to be limited to the entertainment hotbeds of Miami and Orlando.
"The biggest advantage of the FAB is that they have a very strong administrative core," Gordon says. "They also have constituent members all over the state, and some understanding of politics."
The alliance of the entertainment and broadcasting groups also would reflect what's going on nationally and within the state as the Disney-ABC and Time Warner-CNN buyouts have showed. On the regional level, its reflected in the rapid consolidation in the ownership of radio and TV stations.
"More and more, the distributors and stations are doing joint ventures, so it's a logical progression," says Pat Roberts, the president and CEO of the broadcasters group. "I think this will clean up some of the [FEC's] problems, but I wouldn't be interested unless we thought there would be growth on both the broadcasting and production sides and the potential for the new entity to grow rather large very quickly."
Roberts contends that the new entity's budget could increase quickly through expanded private sector support. FEC's current corporate supporters include Disney, Universal and Viacom. But brawny regional broadcasting conglomerates could play a role, too, Roberts contends. The move also could help the FEC focus more in high-growth areas like TV production.
Despite all these apparent pluses to the alliance, it appeared to be threatened as the summer dragged on without an agreement. One source of problems: the inevitable question of who would run the new entity. Despite the perceived management skills of the broadcasting representatives, FEC executive director John Reitzammer clearly hoped to remain in a high-profile position.
Says Gordon: "In the process of getting engaged there are certain gritty realities about living together - like who has to mow the lawn - that have to get worked out, but not when you're down on your knees."
Decisions about who would be the chief executive "might be better put off until later," he says.
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Rethinking Workers' Comp
Florida's landmark 1993 workers' compensation reforms are working so well that it might be time to try some more, says a former division director with the state's Department of Labor and Employment Security.
Ann Clayton, the administration's point person on workers' comp, helped devise the reforms that opened Florida's market to more competition. That's helped keep a lid on prices.
Clayton resigned recently to become deputy director of the Workers' Compensation Research Institute in Cambridge, Mass., the only such organization in the world. Before she left, she told Florida Trend that the state should start considering the next logical step to encourage competition - deregulation of workers' comp prices. Currently, Florida clings to the traditional uniform-pricing method of ratemaking for workers' comp. A few states recently have allowed individual carriers to vary their prices.
Clayton believes Florida corporations could benefit. "If rates are adequate and the system is stable, then I think it's a good time to deregulate pricing," Clayton says. "If those two things occur, it will give Florida an opportunity for even lower costs for employers. It's one thing I think people should start researching."
As FLORIDA TREND reported ["War On Two Fronts," May 1996], large multistate carriers all but disappeared from the state's market over the last 15 years because of regulatory provisions that favored small in-state carriers known as group self-insurance funds (SIFs). As a result, the market became dominated by the SIFs - many of them owned or sponsored by business associations like Associated Industries of Florida. Eventually, competition and even availability suffered. The 1993 reforms encouraged multistate carriers to return to Florida. And already, some have attempted to introduce more price competition, although so far without much success.
Many in-state carriers are expected to resist a price competition proposal because they are believed to lack the reserves to survive a protracted price war.
