Stephen Adams, the former New England small-business advocate for the U.S. Small Business Administration, wrote an op-ed piece in today’s Boston Business Journal discussing our amended Data Security regulations. Give it a read:
A dramatic new economic development effort was launched last week by the Patrick administration but received scant attention. The new initiative will save Massachusetts small businesses hundreds of millions of dollars each year. Yet it was accomplished without ceding a dime of tax revenue, expending a dollar of government subsidy or compromising one inch on consumer or employee protections.
The author of this economic boon is neither an economist or economic development professional. Rather, she is a lawyer and consumer advocate — Undersecretary for Consumer Affairs and Business Regulation Barbara Anthony. She produced this major economic stimulus by rewriting state data privacy rules so that small businesses could comply without taking on unnecessary costs.
It is true that these gains come from scaling back costly new regulations imposed by the Patrick administration in the first place. But this case demonstrates that state government can produce strong economic benefits simply by being attentive to the way its rules and regulations hit small businesses and by being thoughtful in their design.
Late last year the Office of Consumer Affairs and Business Regulation, in response to a legislative mandate to protect consumer and employee data, adopted the most demanding data security regulations in the nation.
Moreover, the onerous requirements would be applied equally to all businesses. That meant that the smallest mom-and-pop would be required to adopt the same data security measures as the largest financial services firms.
OCABR staff had estimated that the new rules would cost a 10-person firm $3,000 in upfront costs and another $6,000 every year. This is a dramatic underestimate, according to some data security experts, who placed the upfront small-business costs at nearly $40,000.
Enter Barbara Anthony. Anthony and her team rewrote the rules to take into consideration the size of a business and the amount of personal information it handles. The revisions require “safeguards that are appropriate to the size, scope and type of business handling the information; the amount of resources available to the business; the amount of stored data; and the need for security and confidentiality of both consumer and employee information.” By designing the requirements around a company’s ability to comply, the revised rules will sharply reduce the cost to small firms and increase compliance.
The news is not all good. The revised regulations will still add a new layer of state costs and requirements to existing Federal data security rules. Nonetheless, if Anthony’s accomplishment can be repeated across the rest of state government, the economic benefit to the commonwealth will be enormous.
Stephen Adams was the New England small-business advocate for the U.S. Small Business Administration from 2005 to 2009.
Forced Arbitration: What the CFPB is doing to further protect consumers posted on Oct 27
The Consumer Financial Protection Bureau, or CFPB, was created by the federal government as a result of passage of the Dodd-Frank Wall Street Reform and Consumer Protection Act to regulate financial products and protect consumers in the market. What is “forced arbitration?” Forced arbitration …Continue Reading Forced Arbitration: What the CFPB is doing to further protect consumers
Health Insurance Open Enrollment posted on Oct 24
Looking for health insurance for you or your family and your employer doesn’t offer it? The Commonwealth’s Health Insurance Connector’s Open Enrollment begins this year on November 1, and continues through January 31st, 2017. Massachusetts and federal law prohibit consumers from purchasing an insurance plan outside of the Open Enrollment period unless there is a qualifying event, such as a birth or adoption of a child, marriage, divorce, loss of insurance through employer, etc.
Have a Safe and Spooktacular Halloween posted on Oct 24
Halloween is a night of tricks, treats, and lots of fun. Unfortunately it’s also anight when people often forget to exercise caution. The Office of Consumer Affairs and Business Regulation would like to provide everyone with a few tips to help make this Halloween a …Continue Reading Have a Safe and Spooktacular Halloween