Searching for Regs in All the Wrong Places

By John Howell, Vice President

Recently, I had the opportunity to speak before a group of government affairs professionals regarding best practices in state and local regulatory advocacy. My message was quite simple: engage regulators as often and early in the “regulatory process” as possible. If you wait for proposed regulations to be published in state registers or in many cases even wait for board or commission agendas to announce regulatory activity, you may be too late to effectively advocate for your company’s or association’s interests. You may have been searching for regs in all the wrong places.

Allow me to explain…

Appointed by Governor Mark Warner, I served on Virginia’s Wireless Emergency Services Board as one of the Board’s three commercial members with the balance of the members coming from the public safety community. Specifically, I sat on the Board representing a national wireless carrier. Our role was fairly simple, to serve as stewards of a fund which was fed by revenue collected from a 9-1-1 surcharge collected from each wireless customer whose place of primary use was Virginia. At the time I was on the Board, the fund generated approximately $3 million in revenue each month.

The vast majority of the revenue generated was used in large part to pay for and/or reimburse local public safety answering points (9-1-1 call centers) and wireless carriers for costs incurred to deploy technology enabling the determination of a caller’s physical location when placing a wireless 9-1-1 call. This was expensive technology. Public safety and most wireless carriers highly protected their interests regarding reimbursement for their respective costs. The Board held monthly meetings which were open to the public and our processes were transparent. We enjoyed a healthy, productive relationship with public safety stakeholders and commercial carrier stakeholders alike and our activities could be accurately described as steady and predictable.

All that changed when the Board was invited to review the legislation that created the Board and directed our activity. We were tasked with editing the legislation as we saw fit and then submitting it back to the legislature for consideration during its upcoming session. As a result, the Board created a legislative committee to hold hearings and recommend legislative changes governing the Board’s operations.

The Board appointed me chair of this committee.

As a committee our task was to hold public hearings to determine where the legislation could be improved and to make recommended additions, deletions or edits. We quickly focused on new rules and a new process for distributing funds. Specifically, we focused on eliminating wireless carrier cost reimbursement and, instead, allocating those funds back to public safety.

Why would I, as a carrier representative, advocate for my company to LOSE tens (if not hundreds) of thousands of dollars a year? Because, my company was in the middle of a major endeavor before the Federal Communications Commission (FCC) that required public safety’s full support to be successful. Passing on thousands of dollars in Virginia earmarked for public safety in order to have a chance to gain even more from the proposal before the FCC was money well-spent. (Our company did go on to successfully conclude the FCC proceeding due in large part to substantial support from the public safety community).

Unfortunately for the major wireless carriers, they never showed up to our hearings and failed to advocate for their companies’ best interests. The carriers were a powerful group and, no doubt may have had the ability to sway the committee members’ respective positions. Had they engaged early, with a sound strategy, and lobbied effectively I am certain they would have avoided the severity of the final outcome. In hindsight, I believe the carriers assumed the Board would not and could not draft legislation. I believe they took the Board for granted and lost a great deal of money as a result. Had they actively monitored the Board’s activities and committees this story may not be the lesson learned for ALL regulatory affairs professionals that it is.

This story is not unique. Often, a board or commission will take up a discussion of potential legislation, hold hearings, and submit findings to the legislature which will give deference to that board/commission. Legislation is subsequently passed and shortly thereafter there is notice of a rulemaking in a state register. Those who wait for publication of proposed rules in a register – those who were not part of the entire process – may find themselves on the outside looking in with very little opportunity to influence the pending regulation.

Whether it’s the State of Connecticut performing a regulatory review of ALL state regulations more than 4 years old (see http://www.governor.ct.gov/malloy/cwp/view.asp?a=4010&Q=533440), or the Commonwealth of Virginia inviting a small regulatory board to suggest revisions to its own enabling legislation seemingly out of the blue, opportunities for effective regulatory advocacy abound and are not limited to publication in a state register.

Is your company or association looking at state registers or are you looking more broadly? Are you engaging early in the process or do you find yourselves trying to catch up? Are you talking to regulators?

If you have similar regulatory experiences I would love to hear from you.

***

John Howell is Vice President of Regulatory Services at Stateside Associates. With substantial policy and legal experience, Mr. Howell guides Stateside Associates’ regulatory counsel and provides clients with hands on Regulatory Issue Management support from strategic planning, regulatory advocacy, and working with groups of state and local officials.

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