by James DeChene

​The General Assembly entered its last week of the 2017 session with over 130 bills on the ready list, and with more bills being prepped and ready to go. Included in the mix are:

• The DEDO reorganization bill, which passed and has been sent to the Governor for signature.
  
• Modernizing the Coastal Zone Act, which is out of committee and on the Senate agenda for a vote
  
• The three revenue bills impacting personal income tax, alcohol excise taxes and the tobacco tax - all of which are also on the agenda for a House vote.  
  
• Along with those is a bill impacting small businesses, HB180, which relates to how and when businesses have to notify their clients of a cyber security attack, along with what remuneration must be made in certain instances.  The bill passed the House, and it is currently unclear if it will make it through the Senate before the end of session. We will provide more details on this next week.

In addition to all of these bills, a budget has yet to be finalized as of this writing, and it remains unclear as to whether there will be a budget in place in time to avoid some sort of continuing resolution to keep the government operational through July.  More info to come next week in the aftermath of the end of session.

by James DeChene

This week saw the passage of two Chamber legislative priorities in the House—modernizing the Coastal Zone Act and enabling language to create a public-private partnership to replace DEDO’s current structure. Both measures now move to the Senate for consideration, and votes, next week. Many thanks to those of you who wrote letters supporting HB190 (Coastal Zone). If you haven’t yet written to your Senator, you can do so here: www.dscc.com/takeaction.
 
Also this week, a series of tax bills were released from the House Revenue and Finance Committee. These bills raise the Personal Income Tax levels; remove itemized deductions (replaced with a higher standard deduction); gradually raise the age someone has to reach before they are eligible for the $12,500 exclusion of income for pensions and other retirement income; raise the excise tax on beer, wine and spirits; increase the tax on tobacco products; and increase the LLC tax. These bills will become part of the discussion on how to balance a roughly $350 million budget shortfall, and discussions continue on what expenditure offsets will be made to balance a 50-50 split to cover the gap.
 
Next week is the last week of session for 2017. Hope remains that a budget deal can be reached prior to June 30th to stave off coming up with a plan to continue budget negotiations into July.

by James DeChene

Wrapping up the week, with seven legislative days left, the General Assembly still has much to do if they plan to adjourn on June 30th. The most important of those tasks remains hammering out a budget deal that can pass. Negotiations continue, but each side remains committed to issues difficult for the other to support. These items include removing prevailing wage from state contracted construction works projects for a period of three years, and raising the Personal Income Tax Rate, which would also include a new top rate of 6.96% for those with incomes above $150,000. Leadership meetings continue, and JFC still has a lot of work ahead of it.
 
The final DEFAC numbers for this budget session come out on Monday June 20th. Barring significant increases to the Corporate Income or Corporate Franchise taxes, or a surprise escheat settlement, or some other unexpected windfall, revenues are expected to remain flat, meaning our budget gap will remain somewhere in the neighborhood of between $350-400 million.
 
HB190, the bill to modernize the Coastal Zone Act is expected to see a House vote on Tuesday, and our hope is HB226, the bill to reorganize DEDO into a P3 will also see a House vote next week. SB10, the bill to increase Delaware’s minimum wage was taken off the Senate agenda and not voted on this week. SS1 for SB76 was heard in the Senate Labor Committee, which would require recognized apprenticeship training programs for companies performing state construction work.
 
Much more to come next week.  Stay tuned.

by James DeChene

June 7th was the Chamber’s End of Session Legislative Brunch held at Dover Downs. Over 200 attendees heard from Ed Ratledge, Director of the Center for Applied Demography and Survey Research at University of Delaware, and Bob Perkins, Executive Director of the Delaware Business Roundtable, on issues impacting Delaware, the state budget going forward, and how best to foster economic development growth. Among the highlights were items previously mentioned in this space:
 

• the fastest growing population in Delaware is the 65+ group, at 15% each year, mainly focused in Sussex County
  
• the costs of state government continue to outpace revenues
• small businesses are increasingly the backbone of our economy
• without a major structural revision of state revenues and expenditures in the immediate future, the state’s budget gap will continue to grow well beyond the current $385 million it is today
  

Attendees also heard from Senate President Pro Tempore David McBride and Speaker of the House Pete Schwartzkopf, who highlighted the state’s budget issues, their respective positions on economic development legislation, including modernizing the Coastal Zone Act, and the reorganization of the Delaware Economic Development Office. They also stressed the need for increased revenues to fund health care and education, the state’s two fastest growing expenses, which together account for over half of the budget. Their remarks adumbrated the potential for further revenue increases beyond the Governor’s proposed 50-50 split of new revenue and expense reductions.
 
The House Natural Resources Committee voted 9-1 to release HB 190, a bill to modernize the Coastal Zone Act. It will face a floor vote next week. The hearing featured passionate testimony from both supporters and opponents, with supporters focusing on the need for the redevelopment of industrial sites currently a blight on Delaware’s landscape. Chamber President Rich Heffron suited up (literally and figuratively) to deliver the Chamber’s position of support.  More updates to come next week as the bill continues to see action.