by James DeChene
This week the General Assembly returned from Easter break and the State Chamber, in partnership with its Small Business Committee and the Association of Chambers, hosted the 5th Annual Small Business Day in Dover. Over 70 people, including Chamber representatives, businesses leaders and elected officials, attended the event. The agenda included meetings between business owners and their legislators, and participation in the Small Business Caucus monthly meeting. Policy items of focus included HB80--Earned Income Tax Credit (Chamber supports), SB65—FAST Training (Chamber supports), HB15—New Personal Income Tax brackets (Chamber opposes), and the legalization of recreational marijuana (Chamber oppose).
This week in Legislative Hall, HB130, related to single use plastic bags, was released from the House Natural Resources Committee. And SB74, with a technical correction to the New Economy Jobs tax credit (Chamber supports), left the Senate Banking and Business Committee.
Next week, SB21—Transportation Infrastructure Investment Fund (Chamber supports) is in committee. More to come as we learn more.
Lastly, the Chamber is working to update its database to identify Chamber members that qualify as Diverse Suppliers. If you carry a Diverse Supplier designation please email Chuck James at email@example.com. Categories are Woman-Owned Business Enterprise, Minority-Owned Business Enterprise, Veteran-Owned Business Enterprise, Disabled-Owned Business Enterprise, Historically Black Colleges & Universities, LBGT-Owned Business Enterprise, Historically Underutilized Business (HUB), and Small Business Enterprise.
by James DeChene
The General Assembly was out this week, and will be back on Tuesday. Last week I highlighted a number of bills having seen action so far this year, and below is the second half of that list.
SS1 for SB37: Expungements
This bill makes a number of misdemeanors eligible for mandatory expungement based on the passage of time with no subsequent offenses. The bill has also been amended to make more than two misdemeanors eligible for discretionary, rather than mandatory, expungement. The Chamber was involved in the process insofar as to make the case that employers have a right to know an applicant’s history balanced with the fact that an offender has paid their debt to society and should have the opportunity for gainful employment. The amendment makes the bill better, and has passed the Senate unanimously. It makes its way over to the House to be heard in committee.
HB80: Earned Income Tax Credit (EITC)
The Chamber supports this bill making the EITC a refundable credit in Delaware. This type of measure does more to support low income workers than minimum wage increases. A 2007 study by the University of New Hampshire found that seven out of 10 economists agree that the EITC is the best antipoverty program available to us, while only one out of 10 said the same thing about minimum wage hikes. The bill makes the EITC a refundable tax credit for Delaware state returns, an initiative the Chamber’s Tax Committee supports.
HB130: Plastic Bags
This bill expands upon the existing at-store recycling program regarding the use of single-use plastic bags. The existing requirements will continue, however stores subject to this program will now be limited from providing single-use plastic bags for only specific uses thereby encouraging a shift to reusable bags. The purpose of the bill, as detailed in the preamble, is to clean up Delaware’s communities and watersheds, reduce storm water and trash management costs to taxpayers, and promote the health and safety of watersheds, wildlife and humans, and the ecosystem’s food chain. On January 1, 2021 this bill enacts a ban on stores providing single-use plastic bags at check-out.
Legalization of Recreational Marijuana
While no bill currently has been introduced, the State Chamber of Commerce membership was polled and 71% of our members oppose the legalization of recreational marijuana. Consistent responses to the survey highlighted issues ranging from the availability of a drug free workforce, concerns about liability in the workplace (offices, manufacturing facilities, warehouses, construction sites, delivery drivers, etc.), the lack of a “spot test” to determine impairment, and on the potency of edibles and other delivery systems.
All of these issues will be discussed in depth next Thursday at our Small Business Day in Dover event. Click here to register.
More to come next week when the GA is back in session. Stay tuned.
by James DeChene
Several bills important to the business community were acted upon this week in Dover.
On Wednesday, Governor Markell signed HB235, the Delaware Competes Act, into law. As mentioned previously, the Chamber strongly supported this legislation that modifies how Corporate Income Tax is calculated, phasing out the multifactor apportionment calculation, and phasing in a single sales factor apportionment.
There was spirited floor debate on Sen. Marshall’s SB 39, legislation increasing the minimum wage. As amended, the bill would raise Delaware’s minimum wage from $8.25 by $.50 in 2017, and then again for the next 3 years, topping out at $10.25. A provision to index to COLA after 2020 was stripped out of the language in order for the bill to pass, and the final vote was 11-8. The bill now heads to the House, where it will be heard in the House Economic Development, Banking, Insurance & Commerce Committee. Stay tuned for more intel as the process continues.
A bill supported by the State Chamber, HB 253, which changes the earned income tax credit from nonrefundable to refundable and capable of exceeding the tax amount otherwise due. The credit is reduced from 20% of the corresponding federal earned income credit to 6% for 2017. That percentage increases 1% each year until it reaches 15% in 2026.
The House Administration Committee heard legislation creating paid Family Medical Leave of up to 12 weeks for state employees who have at least 12 months in their position in order to qualify. The Chamber has concerns with this bill, as it continues a progression of measures increasing the cost of public employees in Delaware.
Good morning, my name is James DeChene, Government Affairs Director for the Delaware State Chamber of Commerce. On behalf of the state of Delaware’s largest coalition of businesses we stand opposed to Senate Bill 39.
The Chamber does not reach this conclusion lightly, especially as Delaware’s economy continues to struggle in the aftermath of the Great Recession. While our unemployment rate remains below the national average, overall wages have not risen to where they were prior to 2009, and unfortunately, SB 39 does nothing to alleviate that problem, and in many ways does more to exacerbate the situation.
We believe that there are examples of the seriousness, and the aftermath, of proposals such as SB 39 that should serve as warnings to Delaware. Numerous articles have been written on the number of small businesses, especially restaurants, which have been forced to close their doors as a result of significant increases in the minimum wage. Areas such as Seattle and Los Angeles have seen such closures, as well as employers forced to roll back benefits, such as matching 401(k) contributions, in order to cover the costs of higher wages. In addition, close to home in Philadelphia, nonprofits that contract with the city say they can’t afford the new $12 per hour wage scale without help from the city. They want more money from the city or an exemption to allow them to pay less than $12 an hour. This was also the case in Los Angeles, where the very unions that pushed for an increase in the minimum wage then petitioned City Council for an exemption for their members to be paid lower.
On the employee side, articles have also been written about employees choosing to work part time in order to maintain their state benefits, even when full time work is offered.
What remains is clear, and has been evidenced by actions national level retailers have taken in recent months, is as the labor market continues to strengthen, the demand for workers will increase, and there will be a natural, market driven increase in wages.
Special consideration should be taken as to what this will do for our younger workers, currently the highest percentage of minimum wage earners in the state, as well as those with developmental disabilities. A marked increase in the minimum wage could serve as a barrier for those looking for first time employment, traditionally in areas such as food service, where these workers start to learn the soft and hard skills necessary to move up in the workplace. Impediments to youth employment, especially in our cities, will cause additional problems to be addressed. Speaking directly to those with disabilities, organizations like Waggies by Maggie, whose entire workforce is comprised of workers with intellectual disabilities will be forced to close their doors if faced with an increase in the minimum wage.
I would urge the members of this committee to consider an alternative measure aimed at low income workers, without suffering the employment losses that raises to the minimum wage are proven to have, which is to increase the Earned Income Tax Credit. It matches at the first earned dollar, and phases out as a worker hits an income threshold. The goals are the same, with positive outcomes.
James DeChene is the Chamber's Senior Vice President of Government Affairs.