Walker red-tape cutting board is all business in WI

By   /   January 31, 2012  /   News  /   No Comments

By Ryan Ekvall and M.D. Kittle | Wisconsin Reporter

MADISON — For regulation reform crusaders, a key battle in the red tape war was fought at the home of a name-brand furniture manufacturer in western Wisconsin.

Ashley Furniture went through what some critics describe as an unnecessary regulation dance over wetlands as it moved to complete a massive factory expansion in Arcardia.

“When they moved forward to get a permit to build a warehouse, they were told (the 13.5 acres) was a wetland,” recalled Dick Granchalek, president of the La Crosse Area Chamber of Commerce.

“For an extended period of years, they were parking their semis on this property, and all of a sudden it was a wetland.”

The two sides reached a compromise and Ashley Furniture agreed to mitigate, but a company official has said the battle between business and environmentalists nearly cost Arcadia 2,000 jobs, the lion’s share of the small community’s employment base.

Paulette Ripley, spokeswoman for the retailer, told the Wisconsin State Journal in 2010 that “substantially all of Ashley’s Arcadia facilities” would have been moved to another state if the permit had not been granted.

Company officials could not be reached for comment, but Ripley said in the newspaper article that Ashley Furniture annually generates an estimated $270 million in economic impact in the Badger State.

Planners and environmentalists have said the furniture manufacturer and retailer should follow the state Department of Natural Resources‘ regulations, and even then the compromise has created flooding problems in Arcadia and on Ashley Furniture’s front lawn, a charge the company and its supporters deny.

But the regulatory ruckus is just the kind of red tape Gov. Scott Walker said he wants to address in a state board he has resurrected.

In his State of the State address last week, the governor announced the appointment of five members of the private sector to the Small Business Regulatory Review Board, which has been defunct since late 2008.

The board will be tasked with reviewing new regulations for their impact on job creation, and work with agencies to weed out regulations that may hinder job growth.

“To create more jobs, employers told us they also need help cutting through the red tape of government,” Walker said.

The board draws its roots from the Small Business Regulatory Enforcement Fairness Act of 1996, a follow up to the 1980 Regulatory Flexibility Act, which aimed to scale back unnecessary regulatory burdens on small business, which supporters say had been trampled under foot in one-size-fits all regulations.

Small businesses spend 80 percent more per worker than large employers to comply with government regulations, according to a recent National Federation of Independent Business, or NFIB, survey of Wisconsin employers. This nonprofit, nonpartisan organization advocates for small businesses.

The same report found 91 percent of small businesses said it was impossible to know about, comply with and understand all government regulations.

The Small Business Regulatory Reform Task Force was created in the early part of the previous decade to continue the charge. In 2003, Gov. Jim Doyle drew from the task force and created the Small Business Regulatory Review Board.

That board remained active for five years, but, its critics have charged, achieved little regulatory reform.

Bill Smith, Wisconsin state director of the NFIB, served on the original task force, as did Steve Davis, an Oshkosh drive-in restaurant owner who recently was appointed to the review board.

Smith said shifts in responsibilities and employees left the board without a staff.

“Because they didn’t have a staff, (the Doyle administration) decided it wasn’t as high a priority,” Smith said, “and they kind of let it drop. Agencies didn’t push; they didn’t pursue it.”

The board has been idle since November 2008.

Bonnie Schwid, a small business owner and former member of the review board in the Doyle administration, said the panel served a valuable purpose when it was operational.

“To me, it was the ability to come in as a small business owner rather than a government employee to review regulation that affects small business,” she said.

This past year, Walker signed into law Act 46, which strengthened the regulatory review board, “empowering small business owners and giving them the ability to have input on the economic impact of government regulations,” said Cullen Werwie, the governor’s spokesman.

“Gov. Walker felt it was best to retool the board, receive input from the private sector and make use of it to help streamline government with the goal of helping create a more positive job creation climate in Wisconsin,” Werwie wrote in an email.

The resurrected board is all business  —  seven of its nine members are pulled from the private sector, with two members of legislative business committees serving as chairpeople.

Smith, a lobbyist for NFIB, is involved in the appointment process, sending applicants to the governor’s office.

Thomas Wulf, president of Wulf Bros. Inc., a heating and cooling company in Sturgeon Bay, serves on the board and is active in NFIB.

Four of the five board members, including Wulf, have contributed to Walker’s campaign. Wulf, for instance, has donated at least $1,450 to the governor’s war chest since June 2010, according to the Wisconsin Democracy Campaign, a nonprofit that tracks political fundraising.

James Ring, president and CEO of Madison-based Park Towne Development Corp., a commercial real estate business, has contributed $4,500 to the campaign since November 2009.

Davis said he has seen the impact of regulation firsthand at his restaurant. As a board member, Davis said he wants to see a smart approach to regulation.

“This is not in any means to have a bill or regulations thrown out but to look at it and say, ‘OK, how would this affect restaurants?” he said. “Is it going to be a lot of time involved in filling out reports? How easy is it going to be for people to comply with it? Is there an easier process to accomplish what was behind the regulation or the rules?”

Davis contributed $100 to the Walker campaign, and has given  to Republican and Democratic candidates.

While a measured approach to regulation reform may help boost Wisconsin’s business climate, environmental organizations and community planners fear the red tape busters will be a rubber stamp for circumventing important protections.

Groups like Clean Wisconsin, the state’s largest environmental advocacy organization, assert much the same is playing out in the GOP drive to streamline the Department of Natural Resources permit process and open the door to open-pit mining in northern Wisconsin.

Kevin Lien, director of Trempeleau County’s Department of Land Management, which has dealt on the periphery with the Ashley Furniture debate, said the land in question was no dry piece of land, and the regulatory process, while not as rapid as some might like, worked.

“I don’t think for any industry or private citizen to go through this effort is unreasonable,” he said.

“Myself and my counterparts across the state have concerns about the environmental issues that may be put aside for economic stimulus and growth. That might be short-term fix, but it puts everyone in Wisconsin in a hardship long-term if we’re destroying our natural resources,” Lien said.

Granchalek said the people of western Wisconsin, particularly its businesspeople, are the first to stand up for the beauty of a region dependent on the Mississippi River and its waterways.

“I don’t think they take that lightly,” the La Crosse chamber official said. “They want to do the right thing, but you also have to recognize when you’re parking a semi on a piece of dirt and all of a sudden you call that a wetland, that’s kind of stretch.”