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A new report from the Salt Lake Chamber warns that other states may be making gains on Utah's status as a leading state for business.

SALT LAKE CITY — A new report from the Salt Lake Chamber warns that other states may be making gains on Utah's status as a leading state for business.

That's because those states are conducting sophisticated analyses of how rules and regulations on businesses affect employers, according to the report, which asks the governor's office and Utah Legislature to do the same.

"Utah does not operate in a vacuum. Improving our regulatory environment will enhance our state’s overall economic competitiveness," according to the report, "The Cost of Doing Business: Improving Utah's Regulatory System."

"While Utah has improved its process, other states are taking the lead with better analysis. After a 50-state review, it is evident that Utah’s current analysis structure is inadequate. Many states have implemented more rigorous analysis, improved processes and mitigation efforts that are leading to economic growth," the report states.

The report praises the economic climate in Utah as "one of the best in the nation," citing Forbes ranking the Beehive State No. 1 for business in six of the past seven years, and a U.S. Chamber of Commerce report saying the state was the "Top Enterprising State" in 2015. But the study also warns of complacent policies.

Salt Lake Chamber spokesman Matt Lusty told the Deseret News that the most important questions in examining business regulations are: "Does it make sense? Is it protecting someone? (Or) is there another way to go about things that's more business friendly?"

"Utah business leaders have become increasingly concerned that our exemplary business climate may deteriorate because of complacency caused by favorable national rankings," Lusty said in a statement introducing the report. "A decline in specific metrics of Utah’s business climate shows these concerns are warranted, in large part to other states surpassing our efforts."

Lane Beattie, president and CEO of the Salt Lake Chamber, called for reform to business regulations in Utah, calling it "among the easiest and simplest ways policymakers can influence economic growth."

The report praised Gov. Gary Herbert for his executive order in 2011 that called for the study of virtually all business regulations in Utah. That review found 48 percent of administrative rules in Utah "substantially" affect business, the report said, and led to 368 changes to "improve efficiency, update state code and improve certainty for business."

Despite those findings, fewer than 3 percent of business regulations in 2015 had been scrutinized using sophisticated statistical analysis to show their impact on Utah businesses, Lusty said.

"There are a number of ways in which we don't really know the price tag of certain regulations that are enacted. … We have these rules and they're affecting business, but it's hard to really quantify the cost to the economy," he told the Deseret News.

In all, 21 states are ahead of Utah in that type of cost-benefit analysis, according to the report.

"A quantitative analysis of the fiscal impact on every rule should be required," the report says. "This must also include improved criteria, methodology and resources for agencies to determine a fiscal impact."

The report additionally recommends that the Office of the Legislative Fiscal Analyst analyze pending legislation that contains business regulations so lawmakers can know in advance how any given statute would affect the state economy. It also asked that every administrative rule enacted by a state agency be subjected to an analysis on how to reduce its impact on small businesses.

Another of the report's recommendations calls for the state to "modernize" the resources on its website "to improve overall transparency."

Lusty said he hopes Herbert and the state Legislature will take the report's recommendations seriously and work diligently to make them a reality.

"To their credit, the governor's office has been actually wonderful in saying this is a good thing you're doing and we want to look at it," he said. "Gov. Herbert has always been great about looking at regulations and wanting to help businesses succeed."