Testimony before the Colorado House State, Veterans, and Military Affairs
Charlie Katebi, Senior Government Relations Manager
The Heartland Institute
May 3, 2018
Chairman Foote and Members of the Committee,
Thank you for offering me the opportunity to testify today. My name is Charlie Katebi, and I am a State Government Relations Manager for The Heartland Institute, a 34-year old national nonprofit. Heartland’s mission is to develop and promote public policy solutions that expand opportunity and empower people. The Heartland Institute is headquartered in Illinois and we focus on providing national, state, and local elected officials with reliable analyses on important policy issues.
I want to thank everyone at today’s hearing for underscoring how important it is that Colorado demand accountability from individuals who work in licensed professions. Of course, nobody wants workers to endanger their customers. But it’s equally important that Colorado holds licensing boards accountable and ensure these licenses are actually being used to promote health and safety, and aren’t being used to prevent competitors from providing quality services to consumers.
This is why Senate Bill 236 would be incredibly beneficial for workers and consumers alike. This proposal would give the Department of Regulatory Agencies (DRA) powers to evaluate whether a profession poses a large and present danger to public health and safety. And if DRA finds that consumers potentially face imminent danger, they will recommend the least restrictive regulations to address these potential harms.
There is a very good reason why Colorado, and all other states, should seek the least restrictive regulations. When states enact excessively restrictive licensing requirements on professions, they impose tremendous harm on poor communities, particularly minority communities. When states require barbers to attain licenses, they reduce opportunities for African Americans to cut hair by 17.3 percent.[i] And every 100 hours of training states require for manicurists reduces opportunities for Vietnamese immigrants to manicure by 17.6 percent.[ii]
Many have argued that closing doors to opportunity for low-income people is simply the price we pay to ensure consumers receive safe and reliable services. But excessively strict licenses often threaten consumer safety and reduce access. Researchers from the University of Tennessee found that areas with stricter electrician licenses had fewer working electricians, and more incidences of electrocution.[iii] This suggests that homeowners who lack access to affordable electricians resort to doing their own electrical repairs—often with tragic consequences.
I’d like to conclude by restating that everyone at this hearing wants consumers to receive safe and affordable services. But real world evidence clearly shows that occupational licenses often don’t make services safer for consumers, and they make it harder for low-income people to participate in Colorado’s thriving economy. Fortunately, Senate Bill 236 would give DRA the tools it needs to determine which licenses are actually safeguarding the public health and which licenses are simply making it harder for families to earn an honest living.
Thank you for the opportunity to testify on this important issue.
For more information about The Heartland Institute’s work, please visit our websites at www.heartland.org and http:/news.heartland.org, or call Charlie Katebi at 978-855-2992 or reach him by email at [email protected].
[i] Law, Marc, and Mindy Marks. 2009. “Effects of Occupational Licensing Laws on Minorities: Evidence from the Progressive Era.” Journal of Law and Economics 52, no. 2 (May): 351–66.
[ii] Maya Federman, David Harrington, and Kathy Krynski, “The Impact of State Licensing Regulations on Low-Skilled Immigrants: The Case of Vietnamese Manicurists,” American Economic Review 96, no. 2 (May 2006): 237–41.
[iii] Carroll, S. and Gaston, R. “Occupational Restrictions and the Quality of Service Received: Some Evidence.” Southern Economic Journal 47(4) (1981): 959.