Natural State News

Reducing barriers for low-income citizens seeking to open businesses, pursue their passions and secure good employment served as the motivation behind the state's new workforce expansion legislation, the architect of the bill said.

The Workforce Expansion Bill, introduced by Sen. Ben Gilmore (R-District 26) waives initial filing of permit and licensing fees “associated with the formation of a business” in Arkansas for certain applicants. It was signed by Gov. Asa Hutchinson on April 13.

These fees will be waived if the applicant has a household income not exceeding 200% of the federal poverty income guidelines. Its provisions kick in at the end of July.

“Obviously, the pandemic has had adverse impacts on many, especially low-income families, but we should always be looking at ways to reduce barriers into vocations and help people move up the ladder of employment," Gilmore told the Natural State News. “Removing an initial fee required to enter a vocation is just one of many barriers to help us be more competitive and grow our economy in Arkansas."

According to a report by the Mercatus Center at George Washington University, Arkansas licenses many rarely-licensed occupations like plant nursery worker, funeral attendant, psychiatric technician, drywall installer, and landscape contractor, insulating the market from competition. A Reason Foundation study found that stricter licensing requirements led to fewer employment opportunities and higher prices in licensed industries, decreasing the rate of job growth by 20%, with a total cost between $34.8 billion and $41.7 billion per year.

“Several other states have done things similar (Wyoming and Utah most recently I believe), and Rep. (David) Ray and myself felt this could work here and hopefully we will see more people employed and moving out of poverty as a result," he said. “These will be permanent for the initial applicants who meet the criteria outlined in the bill. This will help those who need it the most and get a start in a vocation that otherwise they couldn’t afford.”

Gilmore said that his thinking is always to make sure Arkansans "are working, providing for their families, and achieving their God-given potential, we are all better off as a state.”

“The bill did not have an emergency clause, so it will not go into effect until the end of July, however, it will still need to go through the rule promulgation process after that. We may be looking at several months before it will be fully implemented," he said.

Those eligible must have a household income of no more than $12,880 for a household of one; $17,420 for two, $26,500 for a household of four and increases of approximately $5,000 for each additional member.

According to a Mercatus Center report, Arkansas has implemented extensive licensing requirements, with 25.5% of the workforce holding a license or certification in 2015. The Reason Foundation ranked Arkansas fifth in occupational licensing regulations, tripling the regulations of neighboring Missouri.