Business Support & Regulatory Reform
Policy Paper: Reforming the Regulatory Apparatus
Prepared by the Regulatory Reform Working Group
Matt Bauer and Nina Flores, Co-Chairs
NYC BID Association | December 2025Executive Summary
Small businesses are the backbone of New York City, but the City’s regulatory apparatus often makes operating unnecessarily difficult. New regulations are sometimes enacted without fully understanding their fiscal impact, and the enforcement process is often inefficient, arbitrary, and duplicative. To ease the burden on small businesses without compromising public safety and equity, the City must improve the process for analyzing proposed rules, streamline inspections, create a unified portal for compliance, and make low-impact public realm activations easier to permit. The City must ensure that its regulatory framework allows small businesses to thrive.
1. Analysis of Proposed Regulations
The Problem:
New regulations can unnecessarily harm businesses when they are uninformed. The City Administrative Procedure Act (CAPA) requires an analysis to minimize compliance costs, but the methodology is not publicly disclosed. Furthermore, City Council legislative initiatives that affect businesses do not go through the CAPA process, meaning legislators and affected parties often lack a fiscal impact analysis during debate.
Prior to enacting a regulation on a business, City government must ask:
Is the regulation the best means for the government to deliver the benefit or protection to the public or a consumer?Is the regulation narrow enough to deliver that benefit or protection without unduly limiting businesses to thrive?Does the regulation equitably balance the needs and rights of the consumer and seller, or does it tip the scale to a specific party in the transaction?Is the amount that businesses must pay to fulfill a regulation/permit commensurate with the service it receives from city government, and is that amount charged equitably among peer businesses within their category and location?Is the regulation easily understandable to the average manager of businesses within the targeted category?Will the regulation be promulgated so that the average business owner or manager within the affected category is aware of the rule, and has a clear set of instructions regarding whom in City government to turn to with any questions?
The Solution:
Publicly Available CAPA Analysis: Require that CAPA-mandated analyses for proposed rules to be available for public comment and review prior to the rule hearing.
Fiscal Impact for City Council Bills: Before bringing a bill to a full Council vote, the Council needs to provide a fiscal impact analysis of the legislation on affected parties, potentially utilizing the Mayor's Office of Operations to conduct the analysis using CAPA standards.
2. Inspections and Enforcement
The Problem:
Businesses are often subject to multiple, time-consuming inspections from different agencies (e.g., Department of Buildings and FDNY), and staffing shortages can lead to exceedingly long waits for final inspections. Specifically, delays in final inspections for Local Law 11 (LL 11) compliance force property owners to keep costly sidewalk sheds intact, which is a wasteful practice.
The Solution:
Inter-Agency Inspection Teams: Train City Inspectors in multiple agency portfolios so businesses can be inspected in a single visit, avoiding conflicting rules and duplicative visits.
Coordinate Safety Inspections: Create a single inter-agency team between the Department of Buildings and the Fire Department to coordinate and expedite safety-related inspections.
Guarantee Expedited LL 11 Inspections: Allocate additional resources to the Department of Buildings to guarantee a final LL 11 inspection within two weeks of a property owner filing completion.
3. Business Support and Filing Process
The Problem:
The lack of a single, comprehensive source for regulatory requirements, permit filings, and status checks forces businesses to hire expediters, representing a failure of government. Small businesses also need better, localized support to navigate the regulatory landscape.
The Solution:
Fully Functional MyCity for Business: Continue investment in the MyCity for Business web portal to achieve its full functionality as a one-stop online location for businesses to determine regulations, as well as to file and check on the status of permit applications.
Grow Not-for-Profit Support: Fully fund the SBS BEST unit and expand funding for the neighborhood-based network of business support professionals at BIDs, Local Development Corporations (LDCs), and Chambers, who have established trust with local entrepreneurs.
Designate Agency Ombudspersons: Require all city agencies to designate an ombudsperson to gather small business perspectives, resolve issues, and serve as a "go to" person for concerns.
4. Commercial Waste
The Problem:
Unauthorized Dumping: While commercial containerization has helped control the rat population, it has led to a new issue where residents and others improperly use private commercial trash containers outside of collection hours. Businesses are forced to dispose of this unauthorized trash or store it inside until the next pickup.
Increased Hauling Costs: For many businesses, the implementation of the Commercial Waste Zone (CWZ) program has resulted in higher prices for waste hauling per cubic yard than they paid under their previous carter, as maintaining low prices was not a primary criterion for selecting CWZ vendors.
The Solution:
Enforce Illegal Dumping & Inform Public:
DSNY should impose a fine on those who place unauthorized trash in privately owned commercial receptacles.
DSNY should create and produce a uniform sticker to place on commercial containers informing the public about this fine.
Establish a Price Appeal Process for CWZ:
Implement an appeal process allowing businesses entering the CWZ program to ensure that, for at least two years, they do not pay more to haul per cubic yard than they did immediately prior to the CWZ initiation.
5. Business + the Public Realm
The Problem:
Businesses face significant regulatory barriers when attempting to enhance the public realm immediately outside their storefronts. Placing simple amenities like a planter or a bench on the sidewalk requires filing complicated and expensive revocable consent applications with DOT, often leading businesses to forgo such beautification efforts or proceed without the necessary permits. This restrictive environment is exacerbated by the high Small Street Event Permit fee of $3,100, which must be paid even for very-low impact activations such as temporarily placing a red carpet on the sidewalk, thereby discouraging simple acts of commercial vibrancy. While Local Law 79 mandates improved pedestrian lighting, BIDs and businesses lack assurance that their corridors will be prioritized or that their private investment in supplemental lighting will be supported by DOT. Adding to the inconsistencies, grocery stores with a Retail Food Store License cannot apply for a sidewalk café permit, a restriction that does not apply to other food establishments. Finally, the City's efforts to enhance mobility through new busways and bike lanes often overlook the critical needs of affected businesses, leading to concerns about customer and delivery access and the appropriate placement of commercial waste.
The Solution:
Simplify Street Furniture Permitting:
DOT should create a simplified and free revocable consent application process for benches and planters.
Businesses would certify they are following clear path requirements to receive consent, which DOT can revoke if requirements are not maintained.
Revive the "Very Small Event" Permit:
The Street Activity Permit Office (SAPO) needs to bring back the "very small event" permit with a nominal fee for temporary, low-impact activations.
Prioritize Lighting Upgrades and Support Private Efforts:
The Administration should prioritize BID corridors for the lighting upgrades mandated by Local Law 79.
DOT should support BIDs and member businesses that wish to use their own resources to improve lighting.
Allow Grocery Stores to Apply for Sidewalk Cafes:
Allow supermarkets and grocery stores to file for sidewalk café permits from DOT, provided they follow all existing siting guidelines for restaurants.
Target Fines with Sanitation Police:
The Administration must utilize the Sanitation Police to assure that illegal dumping fines are imposed on the responsible party, not the entity that has been dumped upon.
Address Business Access Needs:
The Administration must address the access needs of affected businesses when mapping new busways and bike lanes, specifically considering customer and delivery access, and commercial waste placement.
6. Business Incentives + Taxation
The Problem:
The City’s existing framework of taxation and regulatory incentives is outdated and fails to fully support modern commercial activity, requiring a review of policies like bringing back the ICIP or creating new incentives for converting retail spaces to food establishments. Although the lease threshold for the Commercial Rent Tax (CRT) has been increased, the tax itself remains in place, continuing to penalize businesses located within central business districts. Perhaps most inequitably, the City's laws create a system where property owners are solely responsible for maintaining the public sidewalk (cleanliness, snow removal, masonry repairs) and bear the full liability for pedestrian injuries, yet the City itself licenses and franchises commercial entities (e.g., vendors, bus shelters, Link kiosks) to use the sidewalk right-of-way without the property owner's approval or any form of compensation for the cost of maintaining the space. This structure forces property owners to subsidize the City's franchised uses.
The Solution:
Engineer New Incentives:
Review and implement new taxation/regulatory incentives to reflect modern business utilization of commercial corridors, including providing a tax credit to businesses for their share of the property taxes assessed to their building beyond the base amount established when signing their respective lease.
Specifically, consider bringing back the ICIP (Industrial and Commercial Incentive Program) and creating new incentives for converting retail stores to food establishments.
Permanently Revoke the CRT:
Call on the new Administration to permanently revoke the Commercial Rent Tax to avoid penalizing businesses in central business districts.
Provide Property Tax Credit for City Licenses/Franchises:
As a means to fund property owners' costs of maintaining the right-of-way, affected owners should receive a credit on their City property taxes.
The suggested calculation is to multiply the square footage of the licensee/franchisee's footprint by the tax rate assessed for ground floor space in the adjacent building.
Conclusion
The current regulatory apparatus of New York City, while designed to protect the public, has become an outdated, frustrating, and costly burden on the small businesses that form the economic and civic backbone of our neighborhoods. The systemic issues, from the lack of required fiscal impact analysis for new legislation and the proliferation of costly, duplicative inspections, to the absence of a unified compliance portal and common-sense barriers to public realm activation, collectively hinder growth and vitality. Reforming this system is not an appeal for deregulation; it is a mandate for smarter governance, equitable enforcement, and transparent partnership.
By institutionalizing data-driven analysis of proposed rules, streamlining City services through inter-agency teams and a fully functional MyCity portal, correcting unintended consequences like commercial waste cost increases, and removing unnecessary bureaucratic friction for low-impact public enhancements, the Administration can demonstrate a profound commitment to its entrepreneurs. We urge the City to adopt these modern, pro-business policies, ensuring that the regulatory environment is an accelerator of small business success, not an obstacle to recovery and innovation.