Supporting Arizona’s Small Businesses:
Building Upon Venue Freedom to Serve the Drivers of Arizona’s Economy
Arizona took a significant step to support its small businesses by passing HB 2490, a law that enables plaintiffs to take state agencies to court in their home counties. While this new law expands access to legal recourse, Arizona can go further by implementing regulatory sunsets to ensure that only necessary and effective regulations remain in effect. These measures together can reduce the bureaucratic burden on small businesses, fostering a more dynamic and supportive economic environment.
Previously, Maricopa County was the only venue available to plaintiffs to challenge onerous or procedurally non-compliant regulations in court, alienating outstate Arizonans from fair and equal access to the legal process. HB 2490, signed into law on May 21, 2024, expands access to legal recourse by allowing litigants to bring cases in their county of residence, in addition to Maricopa County. This change eliminates costly travel and prohibitive legal fees, promoting fairness and access to justice. Almost 99.5 percent of Arizona’s businesses are small businesses, employing nearly half of Arizonans. These vital enterprises often lack resources to navigate complex bureaucratic hurdles. By permitting business owners to challenge burdensome regulations in their own counties, HB 2490 saves time and money while empowering those seeking justice.
Governor Hobbs and Representative Selina Bliss should be applauded for their bold effort to expand access to the legal system, and states nationwide, twenty-two of which lack such venue freedom, should follow Arizona’s lead to ensure small businesses can advocate for themselves and support their communities. HB 2490 provides a path to justice for every diner, shop, corner store, and entrepreneur. By reducing the time spent battling compliance, Arizona’s small businesses can focus on enriching our communities. Arizona can be a role model for neighboring California, New Mexico, and Oklahoma, each of which upholds onerous venue barriers for regulatory suits.
Critics argue that this bill may overwhelm local courts with frivolous lawsuits. However, spreading the responsibility of adjudicating regulatory disputes across the state balances the court system rather than concentrating cases in Phoenix. This act thus ensures each court can manage cases more effectively, promoting fairness by leveling the playing field for businesses outside Maricopa County.
However, ideally, Arizona’s small businesses would not need to sue state agencies and contest onerous rules. Unfortunately, because Arizona’s regulations never expire and are only subject to periodic review by agencies, small businesses are faced with an ever-growing regulatory burden. Governor Hobbs should recognize that regulations age like milk and need expiration dates. Thus, to build upon the success of venue freedom, Governor Hobbs should sign a bill mandating regulatory sunsets — provisions that automatically expire regulations after a predetermined period. This approach ensures that only regulations reflecting the current public interest remain in effect.
Arizona can learn from states that have successfully implemented automatic rule expiration. Utah’s code holds that every agency rule expires on May 1 unless reauthorized by the Legislature. Similarly, Tennessee’s code mandates that any permanent rule expires on June 30 of the year following its filing unless extended. New Hampshire also employs a sunset provision, expiring rules after ten years unless amended, readopted, or repealed. Arizona can join the ranks of regulatory leaders by ensuring that outdated or unnecessary regulations do not burden businesses indefinitely. By marrying venue freedom with regulatory sunsets, Arizona can foster an economic environment where regulations serve their intended purpose without becoming an unnecessary burden on small businesses. HB 2490 marks a significant step forward for Arizona’s small businesses, providing plaintiffs with a fair playing field, regardless of geography. However, Arizona can still do more for its small business community. By continuing to refine and modernize the regulatory landscape, Arizona can ensure that small businesses thrive, driving economic growth and enriching communities. Implementing regulatory sunsets is a crucial next step in this process, promoting a dynamic regulatory environment that truly reflects the needs and interests of the public. Arizona has set a powerful example with HB 2490; now it’s time to build on that foundation and secure a prosperous future for all.