Licensing Arizona

She starts with a light touch along his spine to relax him. She gently waggles his fetlocks. She presses harder as she begins to knead the brachiocephalici, the big muscles that run from the horse’s skull down to his front legs. “This is the cowboy west,” Kelly says. “They love their animals, but there’s a deep notion that the horse just goes.” Her approach — inspired by famed equine sports masseur Jack Meagher — is a more touchy-feely one. And Ben seems to like it: The bay leans in to Kelly as she works her fingers in his flank, where she presses both ends of his gluteals.

Easing animals’ strains and pains, Kelly is convinced she is doing good. But according to the Arizona State Veterinary Medical Examining Board, she’s breaking the law by practicing veterinary medicine without a license.

It was in 2012 that Kelly first received a cease-and-desist order from the veterinary board accusing her of committing a Class 1 misdemeanor by violating Arizona’s Veterinary Practice Act. The board threatened that if she didn’t quit her business, they would fine her a thousand dollars “for each violation.”

Kelly’s case was taken up by the Institute for Justice, which focuses its pro-bono legal work on the proposition that economic rights are civil rights. Attorneys for the institute filed suit against the veterinary board in 2014 arguing that the license requirements were an unconstitutional restriction on the right to earn an honest living. Two years later, they are still litigating.

Such are the battles over occupational licensing being fought in courts and legislatures across the country. For decades, states have been putting ever more jobs off-limits to anyone who doesn’t have special government permission. In the years right after World War II, “less than 5 percent of U.S. workers were required to have a license from a state government in order to perform their jobs legally,” according to Morris Kleiner, professor of public affairs at the University of Minnesota. Now it’s estimated at nearly 30 percent. Every now and then, and with great effort, a state will remove the license requirement for a job: Kentucky, for instance, just eliminated a requirement that hair-braiders be licensed by the Kentucky Board of Hairdressers and Cosmetologists. But the longstanding trend runs the opposite direction. Though licenses put up hurdles, if not roadblocks, to people looking for work, states keep adding new occupations to the lists.

Louisiana licenses florists. Louisiana, Massachusetts, and Connecticut license “home entertainment installers.” Seven states license upholsterers. In 33 states you need a license to be an auctioneer; in 36 states you need a license to call yourself a “makeup artist”; and in five states you need government approval to be a “shampooer.” Before you can work as an interior designer in Washington, D.C., the District of Columbia Board of Architecture and Interior Design requires that you supply educational bona fides, pass an “examination administered by the National Council for Interior Design Qualification,” and pay $175 in fees.

There are over a thousand different occupations that at least one state regulates. More often than not, acquiring a license requires demonstrating some level of education and training. In Celeste Kelly’s case, she’s been told she has to graduate veterinary college and pass a licensing exam before she can be paid to give horses therapeutic rubdowns. This, even though her experience with horses was hands-on long before she took up massage.

Kelly grew up hanging around the Long Island stables, where her father trained thoroughbreds. Hers is the sort of hard-won knowledge that’s insufficiently formal for a credentialing regime. And when it comes to credentials and experience, Kelly says it’s often the veterinarians who come up short: “No one should be an equine therapist who doesn’t ride. You’d be appalled by how many equine vets don’t ride.”

Not that Kelly is dismissive of animal doctors—just their political wing. “The statute wasn’t written by the hard-working vets out here in the field,” she says. “It was written by the veterinarians’ association.”

And written broadly at that. In its extensive and inclusive listing of things that count as veterinary medicine are such items as giving “any instruction or demonstration for the cure, amelioration, correction or reduction or modification of any animal condition, disease, deformity, defect, wound or injury.” While, say, curing a disease would clearly fall into the practice of veterinary medicine, what about the “amelioration” of “any animal condition”? Wouldn’t that proscribe just about anything a decent trainer does?

Nobel Prize-winning economist Milton Friedman was on to this whole game. In Free to Choose (1980) he wrote that “organized occupational groups persistently strive to have the practice of their occupation legally defined as broadly as possible in order to increase the demand for the services of licensed practitioners.”

The Arizona veterinary board says it just has the “health and safety of animals in mind.” Victoria Whitmore, the board’s executive director, says that “since there is no statutory definition of or exemption for animal massage in the state of Arizona,” it is up to the board to consider “each case and circumstance individually” in determining whether “the acts of some individuals providing animal massage services may fall within the statutory definition of the practice of veterinary medicine.”

But does that claim of discretion suggest reasonableness or just uncertainty and caprice?

After two years litigating against the state veterinary board, Kelly marvels that Arizona prides itself on being “a free-market, right-to-work state” when its regulation of occupations makes it hard to work.

Arizona’s governor, Douglas Ducey, is looking to make the state friendlier to those who would like to work without first having to get permission from the government. “Arizona requires licenses for too many jobs,” Ducey declared in his state of the state address this January. He called for eliminating licenses that create “a maze of bureaucracy for small-business people looking to earn an honest living.”

The state needs the reform. Among the many contra-indications to its reputation for Goldwater libertarian-conservatism, Arizona long ago became one of the states most burdened with occupational licensing laws. To earn an occupational license for an average low- or mid-skilled job in Illinois, for example, it takes about 200 days of training and experience; the same sort of license requires, on average, some 600 days’ preparation in Arizona. According to an analysis by the Institute of Justice compiling each state’s occupational licensing, Arizona’s requirements are the most burdensome in the nation.

Long overdue is the bill to eliminate license requirements for half a dozen professions that has been moving through the Arizona state legislature. Among the professions targeted for some measure of deregulation are cremationists, landscape architects, citrus-packers (yes, citrus-packers), assayers, driving-school instructors, geologists, and yoga instructors.

If the law gets to the governor for his signature, it will be none-too-soon for Patty Callahan, who owns two “True Hot Yoga” studios in the Phoenix area and is a licensed instructor. When I meet her at her Scottsdale location, she looks every bit the modern yoga entrepreneur — slender, unflashy, and with a ballerina’s posture. She opens the door to the studio where a class is in progress, releasing a steamy blast of equatorial rainforest heat; inside, sweating clients in obligatory stretch-togs make with the contortionist poses.

“No student has ever asked me whether I’m licensed,” Callahan says, closing the door. Students learn about her studios through word of mouth, social media, Yelp, and other opinion aggregators. “We have an incentive to protect our students. If they’re not happy, word gets around and we don’t get students.” The consumers of Callahan’s product are not looking to the state to tell them a good yoga studio from a bad one.

Not that the licensing ever had anything to do with the quality of the education provided by Callahan’s studio. She says no one from the Arizona State Board for Private Postsecondary Education came to observe the classes being offered; no one interviewed the students or the teachers. Callahan could have been providing erroneous down-dog instruction and no one from the board would have been the wiser. “The state board isn’t looking at the actual program,” Callahan says, “they’re looking for the busy paperwork to be in order.”

And what a lot of costly busywork there is: When Callahan first did her licensing, she had to prepare or pay for the bond, the insurance, the application fee, the certified financials, the booklet of documents, and the sherpa to lead her up the bureaucratic mountain. “The application process ended up costing me $10,000,” she says. And every time the license comes up for renewal, it costs her a few thousand more.

All that so she can offer an advanced class for about a dozen students a year. If she had merely been teaching yoga, no license would have been necessary. But since the advanced classes were called “yoga teacher training,” they were treated as vocational classes, putting the course under the jurisdiction of the state’s private-postsecondary-education board. Which is how Callahan found herself in line one day with school administrators: When she showed up for her license hearing, “The person in front of me was the representative of a medical college that does postgraduate work with doctors. I was being subjected to the same scrutiny as a medical school,” Callahan says. “I thought, this is insane.”

The fight against over-licensing is not a partisan one. The sides of the argument don’t line up in neat ideological rows. Businesses big and small, for example, aren’t always (perhaps not even often) in favor of free markets: The prospect of having government block would-be competitors from entering the marketplace can be all too alluring. And some on the left — including the Obama administration — have begun to recognize that knocking down barriers stopping workers from working could be a compelling social justice cause. A White House report last July noted that among the challenges faced by ex-cons trying to go straight are occupational licenses, many of which bar licenses to anyone with a criminal record. The administration issued a call for reform, asking states to limit “licensing requirements to those that address legitimate public health and safety concerns to ease the burden of licensing on workers.”

The courts — which, ever since the Supreme Court’s 1889 ruling in Dent v. West Virginia, have accepted occupational licensing as among the powers of the states — have also started to take notice of abuses of that power. Last year the Supreme Court ruled in North Carolina State Board of Dental Examiners v. FTC that dentists couldn’t use the licensing power given them by the state to shut down non-dentists who were cutting into their lucrative teeth-whitening businesses. The anticompetitive nature of licensing boards, the Court found, could be egregious enough to run afoul of federal antitrust laws.

But it’s at the state level where real change will — or will not — happen. And even as a bipartisan consensus develops about the costs of license creep, professional associations continue to push for state-by-state rules empowering them to define and regulate who can practice their trades. The national locksmiths’ association is pushing for more states to license locksmiths. The Registry of Interpreters for the Deaf is looking for state and local regulations on sign-language interpretation. And then there are the music therapists. The healing power of music may have been around as far back as Apollo and his lyre, but that was before there was an American Music Therapy Association and a national Certification Board for Music Therapists. Together, those organizations launched a campaign pushing for new license requirements coast to coast. “There are currently 35 active task forces involved in state recognition efforts,” they crow about their “State Recognition Operational Plan.” So far, North Dakota, Nevada, and Georgia have taken the bait, adding “music therapists” to the growing lists of occupations that require government permission.

As silly as those efforts may seem, it’s important to push back against license-bloat, and to do so long before new licenses get in place. Because once an occupational license is on the books, it’s a beast to get rid of: “It’s amazing how easy it is to create a license, but how hard it is to remove a license requirement,” says Warren Petersen, chairman of the Arizona house commerce committee. As soon as an occupation is licensed the new law creates institutions and interests that benefit from — and will go to the mat to defend — the licensing scheme. Petersen says that Arizona has “some regulations instituted in 2004, or 2010, and now people can’t imagine going without them.”

Not least among those institutions are the many quasi-governmental boards created to issue occupational licenses. Take away the license requirements and board members lose power and per-diems. As collectors of license fees, those boards often have deep pockets to fund the protection of their perks: “The boards have contract lobbyists, and contract PR people,” says Daniel Scarpinato, a deputy chief of staff for Governor Ducey. “It’s the capital-industrial complex.”

“When a bill initially comes along, everybody’s for deregulation,” says Institute for Justice senior attorney Paul Avelar. “But then it gets nicked and cut by individual interests who claim that ‘Without regulation, we’ll kill people!’ ”

Which is exactly what happened when the legislation inspired by Ducey’s call to end unnecessary licensing came before the Arizona house commerce committee in February: “I’ve never had so many people turn out against a bill,” says committee chairman Petersen, who authored the legislation with the governor’s team. “Not one of them was a consumer.”

This is exactly as Milton Friedman would have predicted. “The justification offered is always the same,” he wrote: “to protect the consumer. However, the reason is demonstrated by observing who lobbies at the state legislature for the imposition or strengthening of licensure. The lobbyists,” Friedman wrote, “are invariably representatives of the occupation in question rather than of the customers.”

At the Arizona house committee hearing on the bill, a parade of landscape architects proclaimed the dire consequences that would follow if just anyone were allowed to tend to the real estate between buildings and the street. “Loss of licensure in Arizona would be a catastrophic hit to the profession,” Jeff Velasquez gravely warned. There were even arguments more comic than dire, as when landscape architect Craig Coronado joked that without certification he might be mistaken for a mere “landscaper.” The horror! Not that the landscape architects were unreasonable, mind you. The lobbyist for the Arizona chapter of the American Society of Landscape Architects took to the podium and applauded “the fact that we are here having a discussion about shrinking government.” But soon came the inevitable “however,” followed just as inevitably by a litany of reasons why ending the licensure requirement for landscape architects would be a disaster. For the most part, those reasons had to do with the livelihood of Arizona’s licensed landscape architects.

Then came the licensed geologists, eager to make the case that only state-licensed geologists should be allowed to practice geology. Tiana Rasmussen warned of “loss of property and even the loss of life.” Barbara Murphy played the “health, welfare, and safety of the public” card. And Stephen Noel told lawmakers that they just didn’t get it: “Most of you do not understand the intricacies of what a geologist does.” Noel, it’s worth noting, is not only a licensed geologist but a member of the Arizona State Board of Technical Registration, the outfit that handles the licensing of professions such as assayers, land surveyors, engineers, and geologists. With stakes both in being a licensed geologist and in being the geologist who licenses other geologists, Noel had a double incentive to show up for the hearing and deplore the legislation.

Conflicts of interest abound in the world of professional licensure. Appearing at the hearing to oppose Arizona’s de-licensing of yoga studios was a lugubrious lobbyist with a gray walrus mustache. He was there to decry the effect the legislation would have on one school in particular, though somehow the school remained nameless. Students at the school in question, he said, use monies from the federal government — student grants and loans, VA benefits — to pay for their yoga training. That arrangement, he warned, might come to an end if the school no longer sported an official license from the Arizona State Board for Private Postsecondary Education.

There is a school, by the way, that fits the lobbyist’s description: the Southwest Institute of Healing Arts, which accepts federal student aid and veterans’ benefits for its courses in hypnotherapy, holistic nutrition, natural aesthetics, and yoga teacher training. The founder, director, owner, and “Chief Spiritual Officer” of the Southwest Institute is KC Miller. The school’s website brags that she “is a longtime Reflexologist, Polarity Practitioner, Life Coach, Toe Reader and Ordained Minister.” Oh, and one other thing: She also happens to be the vice-chair of the Arizona State Board for Private Postsecondary Education.

It’s not clear which is worse, (1) that the owner of a yoga teacher training business should be in a position to say who else can open a yoga teacher training business, or (2) that the board governing Arizona’s private post-secondary schools includes a “toe reader.”

Current licensees and their professional associations aren’t the only players with stakes in the licensing game. License requirements commonly require that the applicant take a set of prescribed classes and pass at least one exam. Which means that an entire national industry has grown up to provide classes and exams.

Look at the marketing materials of companies offering test-prep to, say, general-contractor hopefuls: It quickly becomes clear that being knowledgeable in general contracting is not the primary goal of the classes. Many states provide open-book exams; test-prep companies helpfully sell the book. Many states allow those books to be tabbed for easy reference; test-prep companies helpfully sell the “permanent tabs” that are the only sort allowed. Many states allow test-takers to highlight the book they take into the test; test-prep companies helpfully tell their clients what and where to highlight. Or they’ll just deliver a fully test-ready reference book. Typical is an exam-prep company called American Contractors, which promises their “code books are tabbed and highlighted to help you find important information on test day.” And so it is no coincidence, for example, that in the 1990s, in the license-heavy state of Florida, a firm providing test prep for license applicants and also with millions of dollars in contracts to administer exams on behalf of the state — a company that went by the acronym ACSI — was owned by two of Tallahassee’s biggest political power-brokers.

For all the pushback, the Arizona bill has survived its legislative ordeal so far, and mostly intact. After sustained lobbying, landscape architects won a reprieve: Their profession has been removed from the de-licensing effort. Nor will the geology license be eliminated, but it will be made optional. But assayers, citrus-packers, cremationists, driving-school instructors, and yoga teachers are still in the bill, meaning licenses would no longer be required for those jobs. The legislation may get a final vote soon and head to Governor Ducey’s desk.

“I don’t know of many states that have taken on so many licenses at once,” Arizona house commerce committee chairman Warren Petersen says. But there are still plenty of dubious license requirements at which to take aim: “We license bingo callers and talent agents.”

He hopes this initial effort “is going to open the door to removing license requirements for other occupations.” Who knows, they might even eventually make it legal to get paid to give a horse a massage.

Eric Felten is managing editor of The Weekly Standard.