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BPAA Biweekly State Policy Updates - August 9, 2019

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BPAA is pleased to provide the following biweekly update on state policy. Please contact Tom Schreibel at tbschreibel@michaelbeststrategies.com if you have any questions or updates on activity in your state.

 

Visit BPAA’s website at http://bpaa.com/bpaa/government-affairs/government-affairs  to read previous federal and state policy updates.

 

 

MINIMUM WAGE & LABOR

  • New Hampshire Governor Sununu vetoes minimum wage hike, says it would lead to jobs cut, hours slashed: CONCORD — Gov. Chris Sununu vetoed the first hike in the state minimum wage in 12 years insisting it would lead to "lost jobs, cut hours and less money in the pockets of hard working Granite Staters." The two-term governor highlighted opposition to this hike also from an independent business lobby along with the group representing the hospitality industry that objected to how this wage increase would be to tipped employees. "Advocates of SB 10 seem to think that the government can raise the price of labor without reducing the amount of workers that will be hired," Sununu began in his veto message released late Friday afternoon. "I will not be the governor that signs a bill that will lead to lost jobs cut hours and less money in the pockets of hard working Granite Staters.  There is nothing positive about reducing a worker's chances of getting a job." The minimum wage is the lowest hourly rate that employers can legally pay their employees. Minimum wages can be set at the federal, state, or local level, and debates about raising or lowering them are often contentious because of different views as to how they will impact employment rates, tax revenues and economic growth. Read more at UnionLeader.

 

  • NYC's $15 minimum wage hasn't brought the restaurant apocalypse — it's helped them thrive: New York City restaurant workers saw their pay increase by 20% after a $15 minimum-wage hike, and a new report says business is booming despite warnings that the boost would devastate the city's restaurant industry. As New York raised the minimum wage to $15 this year from $7.25 in 2013, its restaurant industry outperformed the rest of the US in job growth and expansion, a new study found. The study, by researchers from the New School and the New York think tank National Employment Law Project, found no negative employment effects of the city increasing its minimum wage to $15. Restaurant workers in the city saw a pay increase of 20% to 28%, representing the largest hike "for a big group of low-wage workers since the 1960s," James Parrott, a director of economic and fiscal policies at the New School and an author of the study, told Gothamist. Read more at Business Insider.

 

  • Minimum Wage Hikes in NYC Are Forcing Businesses to Cut Jobs and Raise Prices: New York City business owners are eliminating jobs, cutting hours, and raising prices in the wake of a $15 minimum wage hike implemented at the end of last year. According to The Wall Street Journal, entrepreneurs across the city are having to make tough choices to the detriment of their employees in order to stay solvent. Thomas Grech, the president of the Queens Chamber of Commerce, told the Journal that small businesses have been shuttering over the last six to nine months, which he blamed on the minimum wage legislation. Read more at Reason.

 

  • To show the power of local governments on business - This California city just voted to give a $30 minimum wage to Uber and Lyft drivers: In Los Angeles County, where the minimum wage is currently $14.25 an hour, studies suggest that Uber and Lyft drivers often make far less. In El Monte, an industrial city east of Los Angeles, the city council just unanimously voted to change that, telling city officials to begin drafting a law that would guarantee drivers a minimum of $30 an hour. Read more here if interested.

 

TAX UPDATE

  • Business groups bracing against push for state tax increases: BOSTON — Citing the state’s recent economic performance, a tech sector business organization focused on state tax policy said the state’s fiscal discipline is improving, but warned of long-term stability risks if the state pursues “over taxation.” The Massachusetts High Technology Council, one of the groups that successfully petitioned to remove the proposed 4% surtax on household income above $1 million from last year’s ballot, said it wants to understand the “forces behind unrelenting calls for new and increased taxes, even as Massachusetts revenue collections have risen steadily to historic levels.” The endeavor comes as lawmakers are working hard to get the income surtax question onto the 2022 ballot and as the House is gearing up for a debate over transportation financing, with tax hikes on the table. The group pointed to fiscal 2019, in which state tax collections totaled $29.69 billion, an increase of nearly 7 percent over the previous year and eclipsing budget benchmarks by $1.1 billion. Tax collections were up 15% over fiscal 2017, the group said. Just one month into fiscal 2020, tax collections are up 6 percent over last year. Read more at Telegram.

 

  • Bloomberg Government reports – Activist’s $4 Billion State Tax-Cut Drive Unites Business on ‘No’: Boeing Co., Microsoft Corp. and other top businesses in Washington state are galvanizing against a ballot measure that would slash the state’s budget by an estimated $4.24 billion over six years. Initiative 976—sponsored by anti-tax activist Tim Eyman—would cut the budget in part by repealing the 0.3% sales tax on vehicle purchases and dropping weight fees for cars and light-duty trucks to a flat $30. It also would lower electric vehicle and snowmobile fees and reduce the motor vehicle excise tax provisions of public transportation agency Sound Transit, which is in the midst of a $54 billion expansion of light rail in metropolitan Seattle. It’s opposed by the Washington Roundtable—the policy voice of the biggest employers in the state, whose members include Boeing and Microsoft was well as Alaska Air Group Inc., Paccar Inc., Starbucks Corp., and Weyerhauser Co. The Washington State Labor Council, AFL-CIO, is also urging rejection. Eyman has had success in the past. Twenty years ago, he sponsored I-695, to replace what he called the “dishonest” state motor vehicle excise tax with “a flat, fair, and reasonable $30 annual fee. Business and labor teamed up and spent $2.2 million on a no campaign,” Eyman said in an interview. “Every editorial board slamming the hell out of it. Every news story monstrously slanted in favor of the government’s perspective. It was a full-throated, non-stop, sky-will-fall-if-you-vote-for-the-initiative, but it passed overwhelmingly despite being radically outspent by the opposition.”

 

  • Florida raking in billions as Americans abandon high-tax states: State governments can benefitOpens a New Window. greatly from an influx of movers – enjoying everything from increased tax revenues to new business activity. Recently, changes to the U.S. tax code have encouraged an increasing number of people to move – taking their cash to lower-tax states like Florida. As it turns out, however, Florida has been banking on moving trends even prior to the implementation of the new tax law. Read more at Fox News.

 

  • Tax reform task force not going to 'tax everything,' but still looking at sales taxes on some services: SALT LAKE CITY — Now that members of the Utah Legislature's tax reform task force have finished a series of public meetings around the state, they're ready to start talking specifics. For Sen. Lyle Hillyard, co-chairman of the Tax Restructuring and Equalization Task Force, that means considering recommending adding sales taxes to some services already taxed in other states, such as Uber and other ride-sharing services. Other subjects of a yet-to-be-scheduled series of meetings, the Logan Republican said, likely will include restoring the full state sales tax on food purchases and reconsidering the constitutional earmarking of income taxes for education. If the task force can come up with proposals supported by a majority of lawmakers, their recommendations could go to a special session of the Utah Legislature later this year, he said. Hillyard said he was surprised at what he heard during the eight town hall meetings held around the state over the summer, starting in Brigham City on June 25 and ending in Orem on July 30. Read more at DeseretNews.

 

  • Seattle council: Durkan soda tax bill veto ‘a complete waste of time’: Seattle City Council’s clash with Mayor Jenny Durkan continued Monday, labeling a recent veto from the mayor on a soda tax funding bill a “complete waste of time.” Back in July, the council passed a measure outlining specific rules for how soda tax funds can be used. The goal was to ensure all of the money goes toward expanding healthy food options, food banks, and promoting healthy eating. The new rules state the money can’t be swapped for general fund dollars to pay for similar existing programs. Read more at MyNorthwest.

 

  • An Alabama lawmaker has filed an ill-advised (and ill-named) “Fair Tax” bill to eliminate the state’s income and sales taxes and replace them with a broad consumption tax.

 

Lawmakers in PENNSYLVANIA have plans to create a legislative task force to address the state’s growing infrastructure needs. And one lawmaker has a plan for eliminating the state’s property tax—a proposal he plans to introduce mid-August. To replace the $15 billion in revenue currently brought in by the statewide property tax, the bill would increase the sales tax 2 percent, increase local individual income taxes, and levying a new 5 percent tax on retirement income (excluding Social Security).

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