Missouri Legislature Stands Up for Small Businesses

In exciting news out of the Show-Me state, Missouri’s legislature has approved sweeping protections for small businesses by adopting the Goldwater Institute’s Home-Based Business Fairness Act. This reform allows hardworking Missourians to run a no-impact small business from home without having to first jump through hoops to get a costly, time-consuming permission slip from their local government.

It may come as a surprise that such a reform is even necessary, especially since small businesses are woven into the fabric of the American economy. Unfortunately, many local ordinances require residents to waste time and money getting an official sign-off on their home-based businesses, even if those businesses aren’t visible and don’t bother anyone. Worse still, many local ordinances are immune to innovation—the products of a bygone, pre-internet era—and are not designed to handle today’s modern economy where commerce happens instantly, and an entire business can be run from a laptop at a kitchen table. Stringent rules limit the kind of work that can be done, the number of employees a business can have, and even the kinds of materials someone can have in their own home.

Championed by Representative Tony Lovasco, and building on education efforts by Representative Derek Grier, Missouri’s reform brings outdated regulations into the 21st century, reducing confusion and empowering entrepreneurs to go after the American dream.

“Many of the most recognizable household names started business in a garage or basement. Getting government out of the way so people can start no-impact home businesses without first getting a permission slip plants the seeds for future innovation,” Rep. Lovasco explained.

Opponents argue that allowing no-impact home-based businesses to operate freely will lead to an influx of disruptive businesses, painting a picture of a world in which every garage becomes an auto body shop. The reality is that this reform clearly defines no-impact home-based businesses as those which are secondary to residential use, fit the residential character of a neighborhood, sell lawful goods and services, can’t be seen from the street, and do not drive increases in traffic or neighborhood noise.

HB 1662 not only modernizes outdated approaches to regulating no-impact home-based businesses, it also brings regulatory consistency to the existing patchwork of city ordinances across the state. This ensures that entrepreneurial Missourians will know what to expect when they decide to work for themselves.

“Home-based businesses help make the American economy run. Home-based businesses also grow into larger enterprises, including some of the biggest companies in America today. Amazon, Apple, Disney, Harley-Davidson, Hewlett-Packard, Google, Mattel, Microsoft, and many other major corporations began in peoples’ homes and garages,” says Goldwater Executive Vice President Christina Sandefur, author of Goldwater’s Home-Based Business Fairness Act.

“But,” as Representative Lovasco notes, “they might never have come into existence if they had faced today’s growing local restrictions on home-based businesses.”

By passing Goldwater’s reform, Missouri’s legislature has taken bold action to protect small businesses. Every state should follow Missouri’s lead and protect the ability of innovative, entrepreneurial Americans to work from home.

HB 1662 awaits the signature of Governor Mike Parson.

Heather Curry is the Director of Strategic Engagement at the Goldwater Institute.

To learn how your state can empower entrepreneurs, protect property rights, and help grow its economy through the Home-Based Business Fairness Act, please contact Heather by clicking here.