By John Howell, Esq., Vice President
Summer is approaching and state legislative sessions are winding down. But, for those who focus on state regulations, the “high season” is still very much underway. And, it all has to do with state elections.
With 36 gubernatorial elections in November, along with high profile issues such as hydraulic fracturing, health care, network neutrality, privacy of information, and a myriad of environmental issues dotting the regulatory landscape, the second half of 2014 is shaping up to be a heavy period of regulatory activity.
We often observe a spike in regulatory activity following legislative sessions. The reasons run the gamut from implementing rules in response to the passage of new laws to more strategic reasons such as regulatory agencies’ desire to maintain independence and authority in the absence of legislative scrutiny. Regardless of the reason, there is no “summer lull” in state regulatory activity. In fact, we are again seeing a sizable uptick in activity through our Regulatory Forecasting and RegulationALERT services and that is in keeping with the historical trend for a midterm election year.
Using a constant issue set as the basis, here is what we have observed:
In 2009, the year preceding the last midterm election, our regulatory services team observed a 27% spike in the regulatory activity between the first half of the year against the second half. In the first half of 2009, our team monitored 738 new proposed regulations while in the second half of 2009 that number jumped to 928 for a total of 1666 first published regulations followed in 2009.
The spike in new regulatory activity continued into 2010 as we monitored over 3,100 new proposed regulations, an increase of nearly 100% against 2009.
Following the elections in 2010, the rate of regulatory activity continued to be strong. Over 1,120 new regulations were first published in the year after which the activity leveled off towards the latter half of 2011 through the first half of 2013.
Now, four years later with another midterm election on the horizon, our regulatory team witnessed a 44% increase in regulatory monitoring activity in the second half of 2013. In the first half of 2013 we monitored 679 new proposed regulations while in the second half of 2013 the number increased to 976 regulations.
In 2014, we are again witnessing close to a 100% spike in activity as compared to the same period in 2013. In this midterm election year, there have been over 1,200 new proposed regulations so far.
As Yogi Berra said so famously, “it’s déjà vu all over again”.
Adding dimension to the impact midterm elections have on regulatory activity will be the results themselves – particularly at the gubernatorial level. Past elections have demonstrated that the re-election of an incumbent governor, regardless of party, often leads to an additional spike in regulatory activity immediately following the election that carries through into the following year.
Conversely, newly elected governors, regardless of party, tend to move in a more deliberate fashion. Administrative priorities involved with taking office as well as the need to establish goals, objectives and new regulatory priorities are the likely driving factors. Therein lies the challenge as new priorities also generate new issues and concerns for those who monitor regulatory activity ranging from having to gain additional subject matter expertise to establishing new relationships with staff.
If 2010 was any lesson to us, we are staring at a sustained period of increased regulatory activity which could last through the first half of 2015.
Exciting times, indeed.