A Forbes survey showing California ranking 38 out of 50 in the Best States for Business and 49 on the Small Business and Entrepreneurship Council’s Survival Index of 2009 was the perfect jumping off point for a meeting between the people who make laws and those business owners who have to cope with them.

California Senator George Runner and Assemblyman Cameron Smyth chaired a panel discussion Friday morning in the Santa Clarita City Council chambers, where more than 100 business owners gathered to talk about the current government stranglehold has on their growth and success.

The panel also included Santa Clarita Mayor Laurene Weste, Councilmember Bob Kellar and COC Trustee Scott Wilk. Most of the time, they sat and listened as several speakers took turns at the podium talking about indifferent state inspectors, unreasonable permit fees and barriers to business.

“There’s such a disconnect between necessity and reality,” said developer Larry Rasmussen (pictured at right), talking about trials of dealing with state inspectors. “All they’re doing is enforcing the federal law to some standard they dreamed up.”

After talking about hoops that his company jumped through to comply with Fish and Game to build an elementary school, Rasmussen brought up the punitive nature of the agency, something Runner said he’d look into.

All the business owners there acknowledged the reality that cities, counties and states are required to implement federal laws to get federal monies, but to a speaker, said that there was no reason why the enforcers could not be more business friendly.

Smyth said that the business community is caught in a power struggle between the legislators and the Governor; especially relating to some budget-balancing legislation that Schwarzenegger sees as helping the business climate of California.

Rasmussen also said the unions were contributing to California’s downward financial slide and said he had an idea that might just work.

“It’s extortion, it’s illegal, it has to stop,” he said of the union situation. “But I’m a businessman and I see an opportunity to open up a franchise of one-way moving trucks up and down the state, because if this continues, there’s going to be a need for them.”

Business owners find themselves suddenly regulated by laws that didn’t exist when they started out; as an example, Runner told about a roofing company that was cited for runoff from roofing materials that had been a normal fixture in their supply yard for years. “Suddenly, the business owner had to control the purity of rainwater that ran off the materials while it sat in his yard,” Runner said. “Even though it is the same material that his company installs on the top of people’s homes.”

Bill Kennedy, chairman of the Economic Development Corporation formation committee, said that helping schools groom students for their place in the work force would be a step forward, as well as using college setaside monies to help entrepreneurs get started.

“California is #49 in small business survival; Nevada is #2, right next door to us. We need to do something about that,” he said. “California’s debt has become so huge, it has a major psychological effect and makes it difficult for businesspeople to invest in California.”

The speakers gave the legislators plenty of fodder for discussion when they go back to Sacramento; perhaps the best part was that both sides seemed to show a willingness to work on the problems.

Runner is scheduling more workshops like this later in the month and in February. For a schedule, visit his website here.