US News & World Report ranks Pennsylvania as the 40th “best” state. This past week underscores why.

With much fanfare, Governor Shapiro announced the launch of a new initiative (“PAyback”). He set deadlines for permit or license applications — with a money-back guarantee if the bureaucracy fails to meet the deadline. This initiative was applauded by business leaders, labor officials and legislators.

Sorry, but is this the best Harrisburg can do?

On the plus-side, forcing government to actually focus on deadlines and customer service is a good thing. So is creating a website where an applicant can track an application.

Of course this is a positive step, but it is so very much a “Pennsylvania-step” forward. It’s a baby step. After all, you can order sneakers on Amazon and have them in 24 hours, or less. And, many people can get a mortgage approved (or denied) in under 45 days.

In the real world, what barbers, builders and factory-operators actually want is the license or permit so they can get to work, create jobs, and make profits. Not a refund.

If you order a birthday cake for your daughter two weeks before her birthday and when you show up to get the cake, the owner instead hands you your money back, you’re not happy — and your daughter’s not happy.

If you’re a builder who’s building a restaurant and you need a permit from Harrisburg to get started, and you’ve borrowed money for the materials so you can meet your deadline promised to the restaurant owner — who borrowed money from another bank to open the restaurant — and after 45 days, you as the builder get an apology letter and a fee-refund from a bureaucrat, neither you, nor your bank, nor the restaurant owner, nor the owner’s bank is happy. No one.

In the real world, from barbers to builders and corporate executives, everyone knows that Harrisburg can be a “black hole” for anyone waiting for a business license or permit. Your application can sit for weeks, months, even longer. 

So, yes, having fixed deadlines and the ability to track an application is an important step in the right direction. But, it doesn’t get the job done. It doesn’t do enough to help small businesses. And, it doesn’t do enough to recruit new businesses to Pennsylvania.

Pennsylvania has 2,400 different licenses, permits and certifications. That’s a lot of forms and regulations, and thousands of bureaucrats pouring over all of that data. And bureaucrats get paid whether they process a builder’s permit or not, whether the factory opens or not, whether the bulldozer moves or not.

However, for solo practitioners or small businesses, not having the permit can literally put them out of business. 

Some licenses have a term-limit, like drivers’ licenses. For example, barbers need to apply for renewals. If the application approval is delayed and the barber’s license period ends before being granted a renewal, the barber is supposed to stop working. That can be devastating.

By the way, did you know that by regulation barbers are only allowed to cut hair at their registered place of business? They aren’t allowed to cut hair in a customer’s home. (Okay, if we all keep quiet about the realities of 2020 and 2021, we do not need thousands of barbers and their customers turning themselves in at the local police station.)

Moreover, let me ask the $160 question: “Why does Pennsylvania even require barber’s licenses?” It’s 2023, not 1223. Barbers are cutting hair and trimming beards; they aren’t using leeches. Do you want to cut hair? Snip away. If you stink at it, your customers will post about you on Facebook, Google, Nextdoor, Yelp, Instagram, etc., and let everyone know.

We know why licenses exist: it’s a revenue source. Just imagine, how many of those 2,400 licenses and permits ought to just be eliminated? That would save small businesses time and money — and help speed up the review of things that truly deserve attention.

Here’s the good news. There is a better way. For years, the legislature has been considering “deemed approved” legislation. The Senate sponsors are Kristen Phillips-Hill and Greg Rothman — both of whom worked in the private sector. 

Here’s how it works. A barber submits an application for a license. After 30 days, if it’s not denied, it’s deemed approved — the barber gets his license. That’s much, much better than a $160 refund and an apology.

For everyone who’s afraid that “deemed approved” will lead to bulldozers and drilling wells springing up all over Pennsylvania with air so thick, we won’t be able to see July 4th fireworks: relax. It’s deemed approved only if the bureaucrats and their attorney-regulators don’t act. If they find a reason to reject it before the deadline, reject it. Just tell the applicant why — whether the applicant is your neighborhood barber, a contractor trying to build a nursing home, or ExxonMobil. Review it and approve it or reject it and say why. 

(Here’s a secret: applicants want a “Yes.” But, a close second is a timely denial with an explanation. Then the applicant can amend the application or head off to court to appeal. The process moves along.)

Here’s the even better news. “Deemed approved” is consistent with Governor Shapiro’s vision and has strong support in the legislature. It could pass this session, if the Governor would say he’d sign it.

Bipartisan cooperation on modernization and transparency. Customer service for small business, and dependability for larger companies. Who knows, US News might move Pennsylvania from 40th into the 30’s…maybe one day, the top 20.

When I was a first year law student at Villanova, I commuted from South Philly. So, I was often late for my 8:00 a.m. Torts class, taught by our very distinguished former Dean. Arriving late meant the Dean and the entire class saw me slither into an empty seat in our theater-style classroom. Sometimes, I just didn’t go in.

One day, I saw the Dean in the hallway and he said that he “missed me.” So, I asked him for guidance. “Dean, I commute each day from South Philly. When I’m late, would you prefer that I come in and sit down; or, would you prefer that I avoid interrupting your lecture?” The Dean looked straight at me and offered sage, direct counsel: “Mr. Ciarrocchi, I would prefer that you arrived on time.” And he walked away.

Harrisburg, listen to my former Dean. The choice isn’t between two bad options: having permit applications delayed, forever collecting dust in an in-box, or getting our money back. There is the best option: we want applications to be reviewed and approved on time.

Guy Ciarrocchi is a Senior Fellow at the Commonwealth Foundation, and the former CEO of the Chester County Chamber of Business & Industry. He writes for Broad+Liberty and RealClear Pennsylvania. Follow him @PaSuburbsGuy.

2 thoughts on “Guy Ciarrocchi: When a money back guarantee isn’t good enough”

  1. I dislike Shapiro very much. But “deemed approved” is not the solution for this current culture. And your article may be conflating two separate ideas:
    IDEA ONE – Governments often create regulations that protect particular firms, industries, and occupations from would-be competitors. These regulations are referred to as “barriers to entry” because they keep some from entering into a market. One of the most prevalent and pervasive barriers is “occupational licensing.” Corporations pay politicians to create red tape so they can keep market share and kill new competition.
    IDEA TWO – Government inefficiency arises from a combination of structural, cultural, and organizational factors: Size and Complexity, Lack of Profit Motive, No Market Discipline, Political Rewards, Lack of Innovation, Inadequate Performance Management, and lack of Transparency and Governance. “Deemed Approved” will not help the problems within IDEA TWO. Deemed Approved is a recipe for disaster because of the amount of corruption allowed in our current culture. Go Cats!

  2. Dom-Dom Giordano and Dan-Dan Borowski won’t talk about this topic. They waste time on Trumpy Bear, abortion, and avoid the relevant and real topics Guy brings up on this platform. Dom-Dom and Dan-Dan are part of the uni-party.

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