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Strategies for Navigating the Regulatory Maze

(September 2012) posted on Tue Sep 04, 2012

Lessons learned from years of dealing with regulations and those sent out to enforce them.


By Mark A. Coudray

The regulatory aspect of business is a pain in the you-know-what. As much as we would like it to go away, that simply will not happen. Noncompliance is not an option, but this doesn’t mean you have to submit to every arbitrary whim and directive that’s thrown at you. You have two choices when dealing with regulators and inspections: comply on your terms or comply on theirs.
The column this month will be a bit different from what I usually write about. This month, I’d like to share some of the hard-learned lessons of dealing with regulations and those that are sent out to enforce them.
When I first started in business, I was under the impression I had to obey authority and follow the rules as they were told to me. That is just the way it was. For the most part, it was a reasonable assumption based on rules that were in place to protect the good of the people. My parents had raised me to respect authority and the reasons why we had laws and regulations. That was a very naïve assumption, and I was quickly awakened to the real world and how regulators can easily abuse their enforcement power.
This led me to develop several very effective strategies that over time moved me from being in the pile of those being regulated to one of a trusted authority. How did this happen and what were the consequences?
Let me state straight out: If you have a business of any size at all, and you are serious about growing your business, you need to belong to the Specialty Graphic Imaging Association (SGIA). They are a tremendous resource when it comes to government regulation and navigating the gauntlet. Marci Kinter heads the Government and Business Information department of the Association. She is a respected authority both within the industry and the regulatory segment of government. This is your central source for regulations affecting screen printing.
Your best defense and strongest position when dealing with regulators is to know the rules. Specific knowledge is something the local and state regulators generally do not possess. It’s very common for them to show up at your doorstep with generalized guidelines. They’ll often try to apply statutes that are completely inappropriate for your business, and that don’t apply at all. If you’re unprepared and unknowledgeable, you have few options.
Local regulation generally comes from either the fire department or building and safety department of your local city or county. In today’s economic environment two things are happening. The first is that regulators are completely overworked and overwhelmed in their jobs. Their budgets have been cut and everyone is being asked to do more work. On top of this, the work is technical and requires constant updating on their part. The updating frequently does not get done, and we pay the price.
The second item is driven by the first. There are now fees for everything. Inspections are driven by permits and the associated fees. There are fees for the permit and review. Annual inspection fees are tacked onto your business license. If you’re determined to handle hazardous or toxic materials, there are fees for those as well. Knowing what fees apply and how you’re being classified can make a great deal of difference in how much you pay, or if you need to pay at all.
Knowing these two key pieces of information, your strategy should be to make the inspector’s job as simple and straightforward as possible. Any value you can bring to them that will accomplish this will lessen the impact on your business. You should also set out to minimize the size and number of fees that apply to your business. You will not be able to eliminate them, but you can definitely reduce them.

The details of preparation
Business inspections typically focus on health and safety. The most common areas of interest are fire extinguishers, flammable and toxic materials, electrical, egress, and access.
Fire extinguishers need to be the proper size for the building and located within the required distance from each other. This is usually 75 ft. The locations need to be clearly labeled and readily accessible without obstructions (boxes, garbage cans, etc.). They also need to be current on pressurization (recharge annually). By noting when you receive your annual inspections, schedule the recharging of your extinguishers one month earlier than the inspection date.
City and fire typically misclassify screen printing based on old-school flammable inks and solvents. Almost all inks and solvents used today are either nonflammable or combustible. This is a big change. Combustible materials are classified the same as cardboard or filing folders. In other words, screen printing is much less of a fire concern presently.
Make certain you have current MSDS for all of your materials, and have them in a binder that is clearly marked and accessible by anyone in the shop. We normally keep the binder next to one of the fire extinguishers. This makes it easy for the inspector to access two things at once.
Electrical issues are another area of concern. The most common violation is excessive use of extension cords. It is permissible to use them, but only when the item is being used. Items like blowout guns that are in constant use need to have extension cords of 6 ft or less. Ideally, you want items like this to plug directly into a receptacle. What inspectors are looking for are unused items like fans that are plugged in but not being used. Extension cords must also be properly grounded, and if possible use twist-lock connectors like those found in the construction industry.
Other electrical violations include circuit-breaker boxes that are obstructed. You need 3 ft of clearance around any electrical panel. They are also looking for breakers that are not labeled, missing breakers, panels not properly secured, or panels with excessive breakers for the rated amperage. These are both electrical and fire hazards.
The issues of egress and access focus on how easy it is to get in and out of a building. All exits need to be properly labeled as EXIT or NOT AN EXIT. Aisles need to be free and cleared of obstructions. This is a big problem for most small shops. We have a lot of boxes, and they take up a lot of space. The best you can do is be aware and be as careful as you can.
Also, for access, the Americans With Disabilities Act (ADA) has become a major challenge for many businesses. This has to do with wheelchair access, ramps, door widths, signage, and railings. Some locales will grandfather existing structures and others will not. If it comes down to an ADA issue, make certain you know whether it is your responsibility or the landlord’s for who is responsible for the retrofit and compliance. This is something you want your attorney to check for in your lease or rental agreement.

Permits
As I travel around the country, I often see bootlegged construction of screenrooms, break areas, offices, and so forth. Some of these modifications are minor; others are significant. If you’re going the route of avoiding permits and inspections, beware. Building inspectors have the right to require you to remove any unpermitted work. In addition, you will pay a penalty/fine and be required to go through the permitting and review process if you intend to rebuild. While it is rare to go the full route of removal/fines/permitting, you will have done immeasurable damage to your business. You’ll be red flagged as a violator, and from that point on, your business will be under the magnifying glass.
The second point is also very, very important. If you build without a permit and inspections, and there is a fire or other catastrophe, you will be held liable and your insurance will not cover your losses. If you have ever taken the time to read the fine print of your policy—hardly anyone does—you will find all kinds of ways for the insurance company to avoid having to pay your claims. These clauses and disclaimers include being properly classified and permitted for the type of business and type of policy you have.
There is so much to cover when it comes to dealing with government regulations. While it may be tempting to avoid them by pleading ignorant, you are only kidding yourself. The time and grief you bring upon your business will far outweigh the costs of doing it right the first time.
That being said, anything you can do to help make the inspection process easier by being knowledgeable and organized will help. There is simply too much for an inspector to learn about each specific business. Something as simply making a copy of a current safety article or article about evolving ink technology will be helpful for the inspector and will be viewed as being supportive on your part. The more you know about green and sustainable trends, reducing waste, and minimizing hazardous and toxic substances the better.
Regulations and inspections are definitely not going away. If anything, they’ll be increasing in the future. We also know the costs associated with these activities are going to increase. To keep your costs and distractions to a minimum, use the system to your advantage by being positioned as an advocate for workplace health and safety. Let the inspectors know you can be a source for information that will help them with their jobs and you will be in the best possible position.


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