Illinois Governor Signs Licensing Reform Bill

For many hardworking people, it just got a little easier to earn an honest living in the Land of Lincoln. On Friday, Gov. Bruce Rauner signed into law Senate Bill 1821, which immediately repeals certain burdensome, job-related regulations statewide. The new law, which passed the General Assembly in July, marks an encouraging, bipartisan step forward for economic liberty in Illinois.

The new law officially repeals occupational licensing requirements for athlete agents and real estate timeshare sales. It also exempts some internet auction sites from having to register with the state Department of Financial and Professional Regulation, which should be a welcome change for companies like EBay that allow users to bid for products, and makes it somewhat easier to resell tickets legally for sporting, theater and other major events.

“SB 1821 is a small but promising step forward,” said Beth Kregor, Director of the Institute for Justice (IJ) Clinic on Entrepreneurship at the University of Chicago. “Like too many other states, Illinois has a vast web of regulations that make vibrant entrepreneurship difficult, if not impossible. This new law shows that lawmakers are starting to cut out licensing red tape that slows down job growth, raises costs for consumers and exacerbates economic disadvantages for the less fortunate. But there is much more work to do to foster economic liberty for all hardworking Illinoisans.”

According to IJ’s “License to Work” report, the state where Abraham Lincoln taught himself to be a lawyer is now more extensively and onerously licensed for low- to moderate-income occupations than 20 other states.  Brookings Institution research shows that occupational licensing is the biggest labor institution in Illinois, with nearly 30 percent of workers needing government permission—whether through a license or certification—to do their job. That is more than twice the percentage of Illinois workers who are union members (14.5 percent) and nearly 10 times greater than the 3.2 percent of hourly paid workers earning minimum wage. The Heritage Foundation determined that the burden of this extensive licensing costs every Illinois family a hidden regulatory tax of $1,245 every year.

State lawmakers and Gov. Rauner should build on the new law to remove more licensing requirements to reduce this burden. They can even start with licenses that would have been repealed in the original, stronger version of SB 1821. Lawmakers should also consider enacting a sunrise and sunset review process, like IJ’s model Occupational Licensing Board Reform Act, to roll back onerous regulations that do more harm than good for workers and consumers.

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