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Legislation sponsored by Assemblymen Upendra Chivukula and John Burzichelli to cut through the bureaucracy strangling New Jersey small businesses was advanced Thursday by a Senate panel.

The bill (A-2129) would revise the New Jersey Regulatory Flexibility Act to force the state, when implementing a new regulation, to minimize the rule’s impact on small businesses so long as the public health, safety, or general welfare is not endangered.

“Untangling red tape for all businesses is a priority, and I’m enthused that we’ve been moving forward on that goal, but small businesses in particular are hit hard by the bureaucracy that can strangle their ability to create jobs,” said Chivukula (D-Somerset/Middlesex). “This is a key step toward helping small businesses avoid getting roped into a morass of red tape.

Current law sets forth various approaches a government agency must utilize to accomplish statutory objectives, keeping in mind the limited resources available to small businesses.

The legislation requires an agency to, when developing rules, minimize the impact on small businesses so long as the public health, safety, or general welfare is not endangered.

“We need to do a lot more to make it clear to agencies that the impact on small businesses must get special attention,” said Burzichelli (D-Gloucester/Cumberland/Salem), who as chairman of the Assembly Regulatory and Oversight Committee has been pushing several regulatory reform bills. “Small businesses are the ones that create jobs and drive our economy.”

The bill establishes a process by which a small business that is adversely affected economically or aggrieved by final rule-making action may file a petition with the agency objecting to all or a part of a rule subject to regulatory flexibility analysis.

For cases in which the agency rejects the petition, this process addresses concerns about frivolous appeals without creating unprecedented procedures with respect to the courts. Specifically, the bill:

  • Establishes a petition process as a prerequisite for a court appeal;
  • Requires the appeal petition to be filed within 90 days after final rule-making action;
  • Creates an optional summary disposition process based on affidavits;
  • Sets sanctions for frivolous appeals; and
  • Places a restriction on appeals based on compliance with the regulatory flexibility process.

The bill was approved 75-0 by the Assembly in September 2010 and released Thursday by the Senate Economic Growth Committee by a vote of 6-0.