The Florida legislature is currently considering HB 9, a bill intended to protect consumers’ personal information.  Unfortunately, the legislation goes too far and imposes exorbitantly costly and harmful data privacy restrictions on all businesses and industries, with a particularly negative impact on small businesses.  If the bill is enacted into law, it would seriously undermine Florida’s role as one of the country’s most business and innovation friendly states.

The Council for Citizens Against Government Waste (CCAGW) launched an advertising campaign in opposition to HB 9 on Monday, February 28, 2022.  The ad describes how HB 9 includes provisions that are similar to the California Consumer Privacy Act (CCPA) of 2018, warns against bringing California’s regulations to Florida, and notes how the legislation will cost taxpayers tens of billions of dollars.  The ad campaign has already been highlighted in Florida Politics and cited by Sunburn publisher Peter Schorsch.  CCAGW also sent a letter in opposition to HB 9 to the House Judiciary Committee on February 22, 2022.

A report prepared for the California attorney general’s office estimated that the CCPA would have initial compliance costs of $55 billion and annual compliance cost of up to $16.5 billion by 2030.  The CCPA was written hastily and did not go through any committee review, leading to problems that have required several revisions since its adoption.  Florida taxpayers and voters have made it clear that they do not want their state to be anything like California, and that certainly includes laws like the CCPA.

A February 22, 2022, Florida TaxWatch analysis found that HB 9 provides 10 new privacy restrictions and would cut Florida’s gross operating surplus by $17.2 billion annually.  The cost of compliance will have a disproportionate impact on small businesses that lack the resources to pay for the new restrictions.  Faced with high start-up and compliance costs, entrepreneurs will be less inclined to choose Florida as the place to grow their new companies.  Instead, they will choose states with more reasonable data privacy laws.

The complexity and cost of complying with this bill are compounded further by the inclusion of a private right of action in the bill.  This provision would result in frivolous lawsuits against every type of business in Florida, from large companies to the local pharmacy and grocery store, if someone thinks their privacy may have been violated.  It is a gold mine for trial lawyers, and a nightmare for businesses.

Even if a business is ultimately victorious, it will be difficult to recoup the time, money and reputation loss spent in needless litigation.  The increased costs will be shifted to consumers, who end up paying higher prices for goods and services.  Like the CCPA, the strict regulations and high compliance costs of HB 9 will make it more difficult for businesses to provide their products to consumers and protect the privacy of their customers, while also increasing barriers to entry.

As Floridians continue to face the highest inflation in 40 years, lawmakers should not pass laws that will exacerbate this economic hardship.  Among the industries that will be hurt the most by this legislation will be Florida’s grocery, restaurant, and tourism industries, which are still struggling to recover from the pandemic.  These industries, particularly tourism, will also now be under renewed pressure from the increase in energy prices that are already occurring from Russia’s invasion of Ukraine.

The adoption of HB 9 will exacerbate the problems that are being caused by a patchwork of privacy laws.  A January 24, 2022, report from the Information Technology and Innovation Foundation (ITIF) found that 50 unique data privacy laws would cost $1 trillion over 10 years compared to a single national framework.  This framework should include consumer choice and control; transparency; data minimization and contextuality; flexibility; and data security breach and notification.

The Florida legislature has already recognized that bills like HB 9 are the wrong solution.  In 2021, lawmakers rejected a similar piece of data privacy legislation.  Legislators should once again act in the best interests of the residents of the Sunshine State and reject this California-style consumer data privacy bill that will be detrimental and harmful to all businesses and consumers.