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BPAA Biweekly Federal Policy Updates - April 5, 2019

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FEDERAL LABOR UPDATE

  • Politico News reports - Regional Wage Bill: A group of Democrats led by Rep. Terri Sewell of Alabama introduced a bill Thursday that would create "regional" wage minimums based on the local cost of living, deepening a rift within the caucus about raising the minimum nationwide to $15, POLITICO's Sarah Ferris reports . Under the proposal, every metro area would be grouped into one of five wage-minimum tiers based on the Bureau of Economic Analysis's cost of living data. These regional minimums would be adjusted "based on increases in the average hourly wage of private sector, non-supervisory workers." Sewell's bill would increase the hourly minimum wage in smaller cities to a projected $12.10 by 2024, compared to big cities like New York City, which would reach a projected $15.10 by 2024.
    • "The only tangible impact of this proposal would be to set minimum wages less than $15 throughout every part of the country that hasn't already passed a $15 minimum wage, or isn't actively considering it," the left-leaning Economic Policy Institute's Heidi Shierholz wrote in a blog post. Mary Kay Henry, president of the Service Employees International Union which backs the Fight for $15 movement, said in a written statement that "allowing different regions to set their own wage floors would simply perpetuate the same regional and racial disparities that have locked workers in those states in poverty wages."
    • The International Franchise Association told Morning Shift that it found the Sewell bill "refreshing," but that "businesses need predictability in order to plan for their future and many of the components of this bill, particularly automatic increases, are problematic for local franchise small business owners."
    • Read more about the bill here at Politico: Progressive Dems attempt to fend off moderate push on minimum wage

 

  • Politico reports New rift exposed as Democrats clash over minimum wage: Several red-state Democrats have threatened to oppose their party’s hallmark $15 minimum wage bill, imperiling a key plank of the progressive platform and revealing another schism in the sprawling caucus. In a closed-door meeting Tuesday, tensions broke out as some House moderates pushed back against the chief policy proposal from House Education and Labor Committee Chairman Bobby Scott — an issue that has been central to the party’s agenda for decades. Democrats are broadly united on raising the minimum wage. Still, the clash exposes an ideological divide in the Democratic caucus, which is being pulled to the left by high-profile progressives while many of its members — particularly freshmen who helped deliver the House — represent states where the GOP has long dominated. Read more at Politico.

 

  • Bloomberg Government reports - McConnell Tees Up Senate Vote on DOL Nominee Stanton: The Senate is set to vote next week on President Donald Trump’s nominee to lead the Labor Department’s Wage and Hour Division.
    • Senate Majority Leader Mitch McConnell (R-Ky.) filed cloture on Cheryl Stanton’s nomination April 4. If the motion is adopted, Senate floor debate will be limited to up to two hours before a confirmation vote.
    • Stanton, the former head of the South Carolina Department of Employment and Workforce, is among several DOL nominees that have been awaiting a Senate confirmation. Some management-side advocates have been eager to confirm several of Trump’s DOL nominees as part of an effort to reverse several Obama-era regulations.
    • The Wage and Hour Division is currently working to finalize two big ticket regulations, updating overtime pay requirements and narrowing “joint employer” liability for franchise and other businesses. The department is hustling to get those regulations finished before the 2020 election so that they’re harder to undo if a Democrat wins the White House.

 

  • Politico reports - McDonald’s Ends Fight on Minimum Wage: Fast-food giant McDonald's told the National Restaurant Association that it will no longer support lobby efforts against minimum-wage hikes at the federal, state or local level, POLITICO's Rebecca Rainey reports. "We believe increases should be phased in and that all industries should be treated the same way," Genna Gent, McDonald's vice president of government relations, wrote in a letter to the lobby group. "The conversation about wages is an important one; it's one we wish to advance, not impede.”

 

  • Bloomberg Government reports - Labor Department Races to Finalize Overtime Rule: The Labor Department is in a race against the clock to get its new overtime pay requirements finalized before the next presidential election. The DOL wants to make sure a new time-and-a-half pay rule is in place so that Democrats can’t kill it if they win back the White House. 
    • January Target: The department is said to be aiming to have a finalized rule effective by January 2020, Jaclyn Diaz and Chris Opfer report in this week’s Punching In.
    • No Extension: The tight timeline means wage-and-hour observers aren’t expecting the DOL to extend the public comment period, which is scheduled to close May 21.

 

PAID LEAVE UPDATE

  • Bloomberg Government reports - First Bipartisan Paid Family Leave Proposal in the Works: The likely fourth proposal for national paid family leave will be a bipartisan effort, Sen. Bill Cassidy said April 3 at an event hosted by the American Enterprise Institute. Cassidy (R-La.) is working with Sen. Kyrsten Sinema (D-Ariz.) to create a federal plan to give new parents paid time off after the birth, adoption, or fostering of a new child. Cassidy was light on details of the potential bipartisan plan, but he did weigh in on plans that could come before the Senate, giving potential insight into what his proposal could look like.
    • Sen. Kirsten Gillibrand (N.Y.) is leading the charge for Senate Democrats with the FAMILY Act, a social insurance model funded by a payroll tax that covers parental, medical, and caregiving leave. On the other side of the aisle are two proposals—one from Sens. Joni Ernst (Iowa) and Mike Lee (Utah), and another from Marco Rubio (Fla.) and Mitt Romney (Utah). Both plans would provide paid leave through early access to Social Security benefits in exchange for delayed or reduced retirement benefits later.
    • The White House also has called for a national paid leave solution, allocating $750 million in its proposed budget for states to “establish paid parental leave programs in a way that is most appropriate for their workforce and economy.” Senior adviser and first daughter Ivanka Trump has particularly emphasized the need for a bipartisan plans.

 

FEDERAL TAX UPDATE:

  • Bloomberg Government reports - House Tax Writers Unveil Bipartisan Bill Fixing ‘Retail Glitch’: Restaurants and retailers would be able to immediately write off the costs of facility improvements under legislation introduced March 26 by Reps. Jimmy Panetta (D-Calif.) and Jackie Walorski (R-Ind.). The bipartisan legislation would fix an error in the 2017 tax law known as the “retail glitch.” The law assigned certain types of capital a longer cost recovery period, making them ineligible for an immediate write-off. Instead, changes such as facility improvements now have a 39-year cost recovery period. The restaurant and retail industries have come out in favor of a fix: Hundreds of companies, including McDonald’s Corp., Rite Aid, and Macy’s, Inc., asked Treasury Secretary Steven Mnuchin in 2018 to issue guidance resolving the glitch. However the Treasury Department said it is up to Congress to fix the law. Democratic leadership so far haven’t been keen to resolve errors in what they see as a Republican product. The tax law (Pub. L. No. 115-97) passed on straight-party line votes, with no Democrats supporting the overhaul. The House bill is a companion measure to Senate legislation (S. 803) introduced by Sens. Pat Toomey (R-Pa.) and Doug Jones (D-Ala.) earlier in March.

 

ALCOHOL & BEVERAGE

  • Pediatricians Endorse Soda Taxes: The American Academy of Pediatrics today issued a sweeping policy statement alongside the American Heart Association, which has long been an active supporter of soda taxes. Today's announcement, published in the Journal of Pediatrics, is the first time that the group representing 67,000 pediatricians has formally endorsed the controversial effort to slap levies on sugary beverages, our Helena Bottemiller Evich writes. The groups recommend that revenue from soda taxes be used toward reducing health and socioeconomic disparities. "On average, children are consuming over 30 gallons of sugary drinks every year," said pediatrician Natalie Muth, lead author of the policy paper. Muth said the proliferation of sugary drinks poses a potential health threat to children, including driving problems like obesity and diabetes.

 

MUSIC MODERNIZATION

  • Local Music At Risk From Justice Department: The safety and security of unique local music scenes across the country may be under threat as Makan Delrahim, the antitrust division chief in President Trump’s Department of Justice, considers allowing the monopolies of the music industry to operate without any federal restraints. On March 28, Delrahim said their review of the nation’s 1,300-plus antitrust agreements, called consent decrees, is gaining steam and that in the coming months they will file motion to terminate hundreds of them. Given the DOJ’s seeming focus on the decrees that curtail the power of the music monopolies, which has included insinuations from Delrahim that he might modify or sunset their agreements, this concerns any individual or business that plays, performs or listens to music. The only way for Americans to hear the tunes they love — whether played by a band or heard over a business’ speakers — is to purchase licenses through two organizations, called ASCAP and BMI, which collectively manage the rights to over 90 percent of the country’s music. While most stakeholders in the music industry believe that ASCAP and BMI’s existence is essential for simplifying the licensing process on performers and small businesses, many have also expressed concerns with their past operational practices. Read more at StarBeacon.com.

SMALL BUSINESS UPDATE

  • Bloomberg Government reports - Chamber Rolls Out Small Business Health Plan Tool Despite Ruling: The U.S. Chamber of Commerce has launched a tool to help people find health insurance offered through President Donald Trump’s expanded version of small business health plans, undeterred by a court loss striking parts of the rule creating the plans. The HealthCare.gov-like portal connects users with the new association health plans across the nation based on their location and industry. The Chamber estimates about 20,000 people are currently covered by newly created state and local chamber association health plans.
    • The launch comes a day after the Labor Department said the plans must continue to provide coverage and pay claims despite a U.S. District Court for the District of Columbia judge’s decision that said the rule establishing the plans violates the Affordable Care Act. Although the DOL didn’t say if it would appeal the decision or request a stay in the case in the document posted on its benefits regulator’s website, it said both are options being considered.
    • In addition to being able to shop for health care, the portal also has resources for associations and chambers looking to create a plan under the new rule, Katie Mahoney, vice president for health policy at the Chamber, said on an April 3 call with reporters. The website displays a banner with a notice about the district court ruling on the same page users can look for plans.
    • In his ruling March 28, Judge John Bates, an appointee of President George W. Bush, struck down two key portions of the rule and sent it back to the DOL for review. Bates didn’t address what happens to health insurance that was in effect at the time of the decision, which left many people with questions about the future of the plans.
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