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BPAA State Policy Update - June 30

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GAMING

  • Rhode Island Sports Betting Is Official As Governor Enacts Law; October Launch Targeted: Rhode Island sports betting crossed the finish line Friday morning and could be active within three months. Gov. Gina Raimondo signed sports betting into law, confirmed by a press release from the RI government’s website before she actually put her signature on the overarching budget bill. Sports betting is one piece of Raimondo’s larger $9.6 billion budget package that legislators sent to her desk Thursday. Legislators in both chambers of the Rhode Island statehouse voted overwhelmingly in favor of the budget. In doing so, they became the second state in a week to approve sports betting legislation, joining New Jersey. Read more at Legal Sports Report.
  • Mississippi Sports Betting Could Go Live July 21, As MGM Casinos Tease Launch: MGM Resorts‘ casinos in Mississippi were supposed to have legal sports betting starting on July 21, according to a tweet from the company. However, that tweet has since been deleted: It's official! @BeauBiloxi and @GoldStrikeMGM will welcome sports wagering 7.21.18. pic.twitter.com/2F6oH9NVN3 — MGM Resorts (@MGMResortsIntl) June 21, 2018
    • That means if you visit either the Beau Rivage in Biloxi or the Gold Strike in Tunica, you might be able to bet legally in exactly a month. But the deletion of the tweet puts that timeline up in the air. That came after the Mississippi Gaming Commission voted Thursday morning to adopt regulations to oversee sports betting at casinos in the state. The commission drafted regulations 30 days ago and put them up for public review, and it appears no major changes were made. That means Mississippi sports betting is on the immediate horizon.
    • Read more at Legal Sports Report.
  • West Virginia Sports Betting Poised To Go Live By End Of Summer As Lottery OK’s Regulations: After becoming the first state to legalize sports betting in 2018, West Virginia now has a framework in place for the industry. The WV Lottery approved emergency regulations this afternoon, poised to administer WV sports betting beginning this year. The agency has free rein to make modifications between now and December. The Mountain State is actually the second state to approve sports betting regulations today. Mississippi did the same with its own rules this morning. WV regulators expect the industry to get off the ground before Sept. 1. Read more at Legal Sports Report.
  • Oregon Lottery Prepping Mobile App, With Mobile Sports Betting to Follow: The Oregon Lottery is laying the groundwork to roll out Oregon sports betting with mobile/online functionality. The first iteration of the app, which will allow players to see if they hold a winning lottery ticket, is planned for later this summer. “The fact of the matter is that when our app launches, there won’t be any ability to buy any of our products,” Oregon Lottery Senior Public Affairs Officer Chuck Baumann told Sports Handle Monday. “It will simply be that players will have ability to check tickets to see if they are winners, as well as get other information, like jackpot alerts, a look at where (lottery) money goes, and there will be a retailer finder. At some point in time, and we’re not sure what that’s going to look like, we will offer games and some sort of sports betting.” Read full article here.  

MUSIC LICENSING/ASCAP & BMI

  • Live Music is Nice. But Buying Performance Licenses Could Be Nicer: "In addition to owning a winery, Meyer happens to be a lobbyist for the Nebraska Winery and Grape Growers Association, and this year he helped persuade state lawmakers to enact a law that levies fines on performance rights organizations whose representatives use “obscene, abusive, or profane language” or “engage in coercive conduct.” Meyer soon realized that the claims in the calls, even if impolitely delivered, were accurate. For a business of his size, yearlong licenses can cost anywhere from $300 to $600 apiece. Fees for larger establishments can run thousands of dollars a year, and each of the four major U.S. companies that license the millions of songs copyrighted in the United States often demand payment. Oregon, Colorado and Washington state have enacted similar laws in the past two years, allowing venue owners or the state attorney general to bring civil suits against a performing rights organization if its representatives violate the law. As in Nebraska, wineries, restaurants and bars have lobbied for the laws in other states. ASCAP said it does sometimes send investigators to bars and other venues that have not purchased music licenses to take note of music being played — information that may later be used in a lawsuit. The new Nebraska law bars “any unfair or deceptive act” and requires employees of music licensing companies to disclose that they work for the company.
    • ASCAP, BMI and others have sued bars for failing to pay for the music they play. Tadpole’s bar outside of Tampa, Florida, closed in 2015 after it couldn’t absorb a $30,000 settlement with BMI. A federal judge in April ordered Villari’s Lakeside, a New Jersey restaurant and bar, to pay more than $56,000 to BMI. BMI had tried to sell the bar a license for almost four years, at a cost of $6,500 a year, according to the most recent quote.
    • BMI and ASCAP say they support the new laws because they reinforce federal law and remind venues that they must pay for licensing. Some musicians also support the laws because they don’t want the venues where they earn the bulk of their money to decide that live music isn’t worth the risk. Read full article here.

TAX

  • States Urged to Proceed With Caution After ‘Wayfair’ A week after the U.S. Supreme Court lifted a major barrier to the collection of sales taxes from remote sellers, the question remains: How will states respond?
    • The majority opinion in South Dakota v. Wayfair, written by Justice Anthony Kennedy, raises legal and logistical questions. At its heart, the decision says a state can require a business to collect sales taxes even if it doesn’t have a physical presence there. That change could help make 2019 the biggest year for state tax overhauls in “many many years,” said Max Behlke, director of budget and tax for the National Conference of State Legislatures. Behlke spoke June 28 at the organization’s Task Force on State and Local Taxation meeting in Lake Tahoe, Nev., among the first gatherings of lawmakers on the decision.
    • Legislators and other panelists urged states to proceed with caution and to look carefully at their laws. The high court’s opinion provides clues to how states can design their remote sales tax collection, but much is still unknown, they said.
    • The 5-4 majority in Wayfair suggested strongly that South Dakota’s law would pass constitutional muster; the state’s model imposes the tax collection threshold at 200 separate transactions or $100,000 in in-state sales. But the court stopped short of formally declaring that South Dakota’s law, which dozens of states have mimicked already, was valid in the absence of Quill Corp. v. North Dakota. The court just made clear that Quill was no longer part of any commerce clause test for when states may impose taxes.
    • Accordingly, the South Dakota Supreme Court still has to bless the state’s economic nexus model before it can become effective. Still, many project that states will flock to copy South Dakota’s model.
  • Brady Warns Blue States to Stop Using Tax Evasion Gimmicks: Chairman of the House Ways and Means Committee Kevin Brady (R-Texas) is warning blue states that create tax maneuvers to avoid the new limit on state and local tax (SALT) deductions. He said their schemes will fail and their taxpayers will “bear the brunt” of these gimmicks. “They are going to lead their local taxpayers into a very bad situation,” he told The Epoch Times on June 26. “The states, through their tax evasion gimmicks, will actually expose their local taxpayers to recourse from the IRS.” Under the 2017 Tax Cuts and Jobs Act, the tax reform bill passed in December, taxpayers who itemize their deductions will be subject to a cap of $10,000 on SALT deductions. States with higher individual income and property tax rates have objected to this cap and have created new ways to avoid the limit. Read full article here.

LABOR AND MINIMUM WAGE

  • 'Fair share' union fees struck down, delivering blow to California labor California’s public employee unions were handed a serious blow in a Supreme Court ruling Wednesday that forbids them from collecting fees from workers who benefit from their representation but do not want to join them. In a 5 to 4 ruling, the court determined that public sector unions' so-called "fair share" fees violate "the free speech rights of nonmembers by compelling them to subsidize private speech on matters of substantial public concern." The decision in Janus vs. AFSCME effectively makes California a “right to work” state, ending a 41-year precedent that allowed public sector unions to levy these fees on workers who don’t belong to labor organizations. Read more at The Sacramento Bee.
  • Massachusetts Governor Signs Law Increasing Minimum Wage to $15 Massachusetts Gov. Charlie Baker (R) signed the “grand bargain” bill into law, raising the state’s minimum hourly wage from $11 to $15 over five years. “I am thankful that all parties came together, compromised and found common ground to produce a better set of policies than what the ballot questions represented,” Baker said in a statement. “The Massachusetts workforce continues to grow with more and more people finding jobs and our administration is committed to maintaining the Commonwealth’s competitive economic environment.” Signed June 28, the bill also creates a permanent two-day annual sales tax holiday, a paid family and medical leave program, and eliminates the state’s Sunday overtime mandate over five years. As a result of Baker signing the bill, proponents of ballot questions on paid family and medical leaveminimum wage, and dropping the state sales tax from 6.25 to 5 percent agreed to drop them as part of the “grand bargain.” Raise Up Massachusetts, a coalition of labor, faith, and community groups, had pushed the ballot questions on paid leave and the minimum wage, while the Retailers Association of Massachusetts pushed the sales tax ballot question. Other business groups such as the Associated Industries of Massachusetts lobbied legislators to craft the “grand bargain” in order to lessen the impact of paid leave and minimum wage on the state’s economy. Read more at Bloomberg Government.
  • Pennsylvania: Governor boosts minimum wage again for state employees Gov. Tom Wolf is raising the minimum wage for a second time for Pennsylvania government employees and contractors under his jurisdiction. Wolf on Thursday signed an executive order increasing it to $12 an hour starting Sunday. It orders an annual boost of 50 cents-an-hour until it reaches $15 in 2024. The administration says wages will rise immediately for 879 employees. Wolf raised the minimum wage to $10.15 in 2016, which was expected to benefit a few hundred state employees. Ensuing governors could undo the order. Wolf's term ends in January and he's seeking a second four-year term against Republican Scott Wagner in November's election. Pennsylvania's wages are set at the decade-old federal minimum of $7.25 an hour, like 20 other states, and the Republican-controlled Legislature has rejected Wolf's overtures to raise it. Read more at WTAE.

FOOD AND BEVERAGE

  • California bans local soda taxes through 2030 to avert industry-backed initiative: California cities and counties will be banned from creating taxes on soda and other sugary drinks for more than a decade under a measure signed Thursday by Gov. Jerry Brown. Assembly Bill 1838, which prohibits new local taxes on "groceries" through 2030, was the linchpin of a complex political deal between the beverage industry and organized labor that emerged over the past week. Proponents of a separate initiative, primarily funded by soda companies like Coca-Cola and Pepsi, that would make it harder to raise state and local taxes agreed to remove their measure from the ballot in exchange for the moratorium. "Mayors from countless cities have called to voice their alarm and to strongly support the compromise which this bill represents," Brown wrote in his signing message. He also expressed concern that the initiative would have placed restrictions on the ability of state regulatory agencies to create new charges: "This would be an abomination." Read more at The Sacramento Bee.
  • Are Sugar-Sweetened Beverage Taxes Regressive?: Evidence from Household Retail Purchases: Recently, an increasing number of legislators at the state and municipal level have adopted or considered soda taxes as a way to encourage healthier choices and raise revenue. Some of these include: Philadelphia, Seattle, Santa Fe, Massachusetts, and West Virginia. The World Health Organization (WHO) has even advocated for national taxes on sugary drinks, like those passed in Mexico, France, and Britain. Aside from them being an unstable source of revenue, one of the most common critiques of soda taxes is that they're "regressive," disproportionately falling on middle- and low-income taxpayers. But just how regressive are soda taxes? Today, we released a new study that uses Nielsen consumption data to explore the relationship between household income and soda consumption. Read full article here at the Tax Foundation.
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