LB345 - Eliminate an experience requirement for abstracters

Good afternoon, Chairman Lindstrom and members of the Banking, Commerce and Insurance Committee.  My name is Nicole Fox, and I am the Director of Government Relations for the Platte Institute.  I’d like to thank Senator Craighead for introducing LB 345.  I am here today to testify in support of this bill.

 

According to the Nebraska Abstracters Board of Examiners, a Registered Abstracter is an individual, registered under the Abstracters Act, holding an operative certificate of registration, who for a fee or other valuable consideration, compiles and certifies Abstracts of Title or prepares Reports of Title for real property in any county within the state of Nebraska. 

 

To become a Registered Abstracter in Nebraska, current law states that an individual must complete an application and successfully pass an exam administered by the Abstracters Board of Examiners.  In order to be eligible to take the exam, the law requires that the applicant have one year of land title-related experience. There are no required courses of study nor is there a school that the applicant must attend in order to qualify for the exam.  The Board suggests that the applicant study the manual “Evidencing Land Titles” published by the Nebraska Land Title Association.  The annual licensing fee for a Registered Abstracter is $150 which is billed every 2 years at $300.           

 

According to the Institute for Justice, a Registered Abstracter license is required in 6 states.  The following neighboring states do not require this license:  Wyoming, Colorado, Kansas and Missouri.  Nebraska is the most regulated because it is the only state requiring one year of experience before one is eligible to sit for the exam. 

 

Nebraska faces a workforce shortage, and occupational licensing creates a significant labor force issue.  Nearly 200 different occupations in Nebraska require a government license, affecting nearly 1 in 4 workers.  This is negatively impacting individuals seeking a means to earn an honest living.  Reform of occupational licensing laws to lessen burdensome regulation is an economic issue that needs to be addressed.

 

Occupational licensing laws were initially created as a means of protecting the public from negligent and unqualified practitioners, but more and more, instead of protecting the public from harm, we now understand that occupational licensing is making it difficult for new workers to enter the workforce.  

 

The licensing requirements for Registered Abstracters in the state of Nebraska are burdensome in two ways.  First, there is the time a worker must invest to meet the experience requirement just to sit for the exam.  During this time period, the worker may have to settle for a job of lower pay.  Second, the $300 fee one must pay every 2 years after becoming licensed is essentially a tax to work.  This cost is often passed on to consumers by raising the price of services.  A study by the Heritage Foundation showed that occupational licensing reform could save Nebraska households over $900 annually.

 

LB 345 strikes the requirement that abstracters have at least one year of experience prior to licensure or temporary certification. Nebraska is one of only six states to license abstracters, and the only state with this experience requirement.  LB 345 makes Nebraska’s job licensing requirements more consistent and competitive with our neighboring states.

 

The Platte Institute strongly supports occupational licensing reform as a means of lessening burdens to those trying to enter the state’s workforce.  I ask that you advance LB 345 out of committee.  Thank you for the opportunity to testify today.  I am happy to answer any questions the committee may have.

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