Kathleen Stevens opened Rainbow Rooster Boutique four years ago with plans of operating a small cafe in the back of the store. The space remains empty, she said, because she doesn't have the money to install all the required equipment. (Photo courtesy of Rainbow Rooster Boutique)
COLUMBIA — Gail Nicholls dreamed of growing and selling plants out of a greenhouse when she her husband opened Red Bug Barn, a pet supply and feed store in Richburg, some 12 years ago.
But when she found out she’d need three separate permits — one to grow, one to ship plants in or out, and one to sell plants grown somewhere else — she was overwhelmed by the paperwork each permit required and the more than 150 pages of rules that came with them.
“We got enough together to buy our own property and build our own building. And we were so excited. We thought the sky was the limit,” Nicholls said. “The sky’s not the limit. The rules and regulations are the limit. You can only go as far as they let you go. There are license after license on the books.”
“They dollar you to death,” Nicholls added. “Five here, five there, 10 here, 15 there.”
Wouldn’t it be easier, she thought, if state regulators combined them into a single certification. According to the Clemson University office that administers the program, they already offer that option.
Still, Nicholls and others are pushing for legislation to increase scrutiny of the state’s more than 80,000 regulations.
State law already provides for oversight of the rules state agencies put on businesses operating in the Palmetto State. But the South Carolina chapter of Americans for Prosperity believes legislators should do more to ensure they actually review them.
Getting the bill, which passed the House unanimously last March, through the Senate and across the governor’s desk is the top priority of the political advocacy group founded in 2004 by libertarian billionaire brothers Charles and David Koch.
At top of mind for the group is making sure legislators sign off on any costly regulations.
Legislators are supposed to give final approval to all agency regulations, minus those required by federal law. But there’s a loophole.
If the General Assembly neither approves nor denies a rule within 110 days, it takes effect automatically. That’s what happened in 2024 with the Department of Education’s regulation on age-appropriate books in schools. Senators were incensed it skipped their review entirely. Last year, legislators voted unanimously on a law to automatically pause the clock on regulatory reviews from mid-May to mid-January while they’re not in session. The law also shortened the total days, from 120 to 110.
Americans for Prosperity wants to stop automatic approvals altogether for regulations that boost business expenses. Under the bill, if the estimated cost to businesses across an industry exceeds $1 million over a five-year period, legislators would have to take an up-or-down vote.
Six of the 77 regulations automatically approved in the last seven years would have been subject to the $1 million threshold, according to the group’s state director, Matt Humm.
In Nicholls’ case, the annual cost of the permits she needed vary by the size of the business — ranging from free for small operations to $200 for a large one. The cost of shipping plants in and out varies based on the number of plants transported — $17 for a batch of 25 or $280 for 10,000 plants, but she could avoid that cost by getting approval to print the shipping labels herself.
That doesn’t include costs she might face for things like pest or disease control. Stopping their spread is the primary concern of those regulations.
State law requires other layers of review before any proposed change to a regulation gets to the Legislature, including public hearings and a fiscal impact analysis.
And existing rules must go back before legislators for re-approval every five years. Still, Humm said, outdated regulations tend to linger and don’t always keep pace with modern technological advancements.
The legislation combats that with a pair of blanket requirements meant to cut the overall number of regulations. One calls for a 25% reduction in the number of regulations each type of small business faces.
The second is a two-for-one provision, forcing agencies to cut to rules for each new one they propose.
It’s a measure Kathleen Stevens supports.
“I’m not saying we don’t need them. I’m just saying we don’t need all of them,” she said. “There’s just garbage on the books.”
While raising her sons, Stevens ran a side business painting and restoring furniture. After her children graduated, she decided she wanted to open a space where other small craft and antique vendors like her could hawk their wares in downtown Chester.
She opened Rainbow Rooster Boutique four years ago with plans of operating a small cafe in the back of the store.
“I just wanted to serve a little coffee and pastries,” Stevens said.
The cafe space remains empty, she said, because she doesn’t have the money to install all the equipment regulators told her she needed. She pulled the application.
“I was overwhelmed,” she said.
Business owners including Nicholls, Stevens and Zack Holt say they’re not opposed to regulations, but they want reassurances that they’re up to date and absolutely necessary.
When Holt purchased an existing restaurant space in Hartsville a couple of years ago for a new location of Holt Bros BBQ, state highway regulators told him the sign that had been in place under previous ownership was too close to the state road.
While Holt didn’t put it there, the state still required him to move it. That, along with permitting delays at the city level, held up his grand opening for nine months, he said.
“That’s nine months’ worth of lost revenue and income,” he said.
And he had to send the new employees he had hired to work at other locations.
Americans for Prosperity and the small business owners it’s representing argue small companies don’t have the same financial wherewithal as big ones to comply with these rules.
“We’re going to lose our entrepreneurship to large corporations,” Stevens said.
Still, state law has had carveouts in place since 2004 meant to address that as well.
When a new rule has a big impact on small businesses, it must go before a special, 11-member committee housed at the state Department of Commerce and made up of small business owners. Part of that process must include financial studies and plans by agencies to reduce the burden on those business owners or exempt them from the rule altogether.
The proposed law would require the same cost-benefit analyses for all new and re-approved regulations. It would also send that information to more people, including the small business panel, for review.
Editor’s Note: This article has been update with information from Clemson University.
