Good news this week from Milford and Smyrna as the Delaware State News highlighted a number of development projects stemming from the Downtown Development Program. The five-year-old program was designed spur economic development in targeted downtowns throughout Delaware in need of revitalization. Of particular note the article stated, “The 12 projects announced Thursday, with nine taking place in Wilmington, received $5.5 million in rebates leveraging $103 million in total investment.”

Also this week, the National Lieutenant Governors Association was in town, hosted by Lt. Governor Bethany Hall Long. The meeting featured a number of topics that related to Delaware—how states have successfully leveraged FEMA in disaster relief, innovative ways to address the ongoing opioid crisis, how states are working with private employers and associations to address the jobs needs across the country (it’s estimated there are 7.3 million jobs currently available—more than the available unemployed workforce), and how criminal justice reform is helping bring ex-offenders into the workforce and stemming recidivism.

In the coming weeks the Council of State Governments and the National Council of State Legislatures will be meeting, and I hope to get feedback from local attendees on any trending policy initiatives that could Delaware could see next year. Stay tuned.

by James DeChene

Last week had, and in the upcoming magazine will have, a write up on the end of session that wrapped up early July 1st. Not captured, however, were some of the more esoteric moments that helped make up the last six months that I’ve found interesting now that summer has officially begun and your friendly neighborhood government affairs professional has time to think.

Headed into January with over 20% new faces was both exciting, thrilling, nerve-wracking and (at least for me) a career first to work with so many new members. It’s been interesting watching them learn the ways of the building, finding out what issues they are passionate about, and how the State Chamber and our members fit in. The answer to the last point is a positive one from my perspective. Each of the freshman legislators I had the opportunity to work with were open to hearing how legislation would impact the business community, and while we may not have agreed after each conversation, it’s important to continue to build the dialogue and relationship going forward.

I was also impressed with the “temperature” of the building. It’s no secret the last few years ended in with tempers flaring as the time grew later and later into July 1st, and even beyond. This year (with hopes that next year will be similar) each Chamber was efficient in finishing up what they needed to do, and it was one of the earliest, and least contentious, endings to a session in recent memory. Let’s keep that particular streak going.

As I think back to the work that was accomplished in the last six months, I’m grateful for the partnerships that helped make it possible. The Association of Chambers has been the most active it’s been in years with almost every chamber of commerce actively participating. The State Chamber membership stepped up to help provide background, talking points, suggestions, communications and alternatives on key pieces of legislation this year. That streak will definitely need to keep going.

You’ll hear more from us in the coming months on priorities we’re pursuing, including cheaper health care options for businesses, innovative ideas on workforce development and training opportunities, as well as asks for help to keep up the pressure on the “old standbys” in minimum wage and marijuana legalization legislation. You’ll also be asked to provide your feedback on these and other issues as we shape our 2020 agenda. Until then, I hope you enjoy this bit of summer and that your AC continues to work.

Minimum wage will be increasing for most individuals in Delaware twice in 2019. On January 1, it will be $8.75 and then on October 1, it will be $9.25. 

But, for the first time in Delaware history, we will now have a multi-tiered minimum wage. The General Assembly adopted a "Youth Rate" and a "Training Rate" that is $8.25. The youth rate applies to workers ages 14 through 17. The training rate applies to adult workers during their first ninety days on a new job. These new categories are $.50 less than the regular minimum wage rate. Effectively, that means workers under 18 and new employees with less than 90 days on the job won't see an increase on January 1st. Their first increase ($8.75) will come when they become eligible for the regular rate or on October 1, 2019, with the next general increase, whichever comes first. 

The labor law poster sets out all the rates. It is required to be displayed in all workplaces in a place accessible to employees and where they regularly pass. The poster is available on the Department of Labor’s website and can be downloaded in English here and Spanish here.

The Delaware Department of Labor connects people to jobs, resources, monetary benefits, workplace protections and labor market information to promote financial independence, workplace justice and a strong economy. Any issues regarding wages should be directed to the Delaware Department of Labor Division of Industrial Affairs.

Contact: Jennifer Zeberkiewicz 
Jennifer.zeberkiewicz@state.de.us
302-761-8002

by James DeChene

In advance of the January 1, 2019 enactment date, the Delaware Department of Labor has released the notice sheet employers will be responsible for providing to new and current employees.  Employers can provide either a digital or hard copy of the sheet, which can be found at the Delaware DOL website, with a link on the left side -- https://dol.delaware.gov/

In addition, for employers with 50 or more employees, note you will be required to provide interactive training for all employees within 12 months of the enactment date, and within 12 months for all new employees. That training is required to be repeated every two years. Those who are in supervisory positions will need additional supervisor-specific training as well. Topics for non-supervisor employees must include the following:

1. The illegality of sexual harassment
2. The definition of sexual harassment using examples
3. The legal remedies and complaint process available to the employee
4. Directions on how to contact the Department
5. The legal prohibition against retaliation

For supervisors the additional training must include:

1. The specific responsibilities of a supervisor regarding the prevention and correction of sexual harassment
2. The legal prohibition against retaliation

Note that if employer-provided training to employees or supervisors prior to January 1, 2019, satisfies the requirements listed above, no additional training is required until January 1, 2020.

Please be aware that questions may arise on what constitutes an “interactive” training and how to satisfy the training topics. The State Chamber’s Employer Advocacy and Education Committee is taking a look at how employers can be compliant, and will continue to provide updates as we get them.

The Delaware State Chamber of Commerce extends its congratulations to tonight’s winners and looks forward to working with them in the 150th General Assembly. The State Chamber would like to thank everyone who participated in the election process.    
  
Please contact James DeChene, Senior Vice President of Government Affairs, if you have any questions at jdechene@dscc.com.

Candidates highlighted in red have received DSCC PAC contributions. 

by James DeChene

During the State Chamber hosted its Developing Delaware event in Dover this week, Governor Carney told over 250 attendees a story about being approached by a gentleman claiming to have a catchy new slogan to market Delaware (a la “Virginia is for Lovers or I love NY). After the reveal of “DelaWow”, and the laughter that accompanied it, Governor Carney went on to make the point that there are things happening in Delaware surrounding economic development that are working (more on that later).
 
The Developing Delaware event featured insights on Delaware by the numbers from TIP strategies outlining Delaware’s workforce makeup, the types of industries represented here, and other key factors that businesses looking to locate here take into consideration in their decision-making process. That was followed by a conversation with site selectors tasked with comparing states, metro areas and other locations for their clients looking to set up shop. Key were the insights on the need to be nimble, to approve projects quickly, and to have a pipeline of sites shovel-ready to market and attract companies to Delaware. For more information and a recap of the event, visit www.dscc.com/developingdelaware.
 
Also this week was the groundbreaking at DOT Foods for their new 150,000-square-foot redistribution center on Wrangle Hill Road and Red Lion Road. DOT Foods is the nation's largest redistributor of food products in the US with 3.5 million-square-feet of warehouse space, $7 billion in sales and 4,800 employees. They will be creating over 250 new job opportunities with an expected $6 million annual payroll.
 
See, Cerron Cade—I can write on positive news too.

by James DeChene

​Congratulations to last night’s primary election winners as they now will go on to face their general election opponents (unless they were one of the few who have no general election candidate, and have therefore will be in office in January 2019).

Candidates in red have received DSCC PAC contributions. Head to our Advocacy page to learn more about the Chamber's involvement with legislative issues.

For the past three years, we’ve been following the appeal of the Delaware and Maryland PSCs to the Federal Energy Regulatory Commission to grant a rehearing of how a regional power authority (PJM) calculated the cost allocation to cover the building of a transmission power line across from NJ to the Delmarva Peninsula.  

On July 19, FERC announced it would grant the rehearing. In the announcement they note:
"…we grant rehearing. Specifically, we find that it is unjust and unreasonable to apply PJM’s solution-based DFAX cost allocation method to Regional Facilities, Necessary Lower Voltage Facilities, and Lower Voltage Facilities that address stability-related reliability issues, including the Artificial Island Project. To determine the just and reasonable rate to be applied, we are establishing paper hearing procedures."

This is good news for Delaware and Maryland rate payers. To recap, previously PJM allocated over 90% of the project cost to be paid for by Delmarva zone ratepayers, driving the cost of power for those receiving less than 10% of the benefit of the line’s use. The estimated project costs are $279 million according to the latest PJM projection, meaning Delmarva Zone customers will be expected to bear responsibility for $250 million. The economic impact to large industrial users would be immense, and for both large and smaller users, concerns over closures and job losses remain.

The Chamber will continue to monitor this issue, and weigh in as appropriate.

by James DeChene

Last week Governor Carney and Treasurer Simpler released a bipartisan plan to help address Delaware’s economic boom and bust cycles. Last year’s $400 million budget shortfall highlighted the volatility in our state’s revenues, and this year’s $400 million increase in revenues, while a boon, is an $800 million swing in just one year. For a state with a $4 billion budget, that kind of shift is incredibly significant.

Enter in the budget smoothing idea. Making changes to smooth out these peaks and valleys in our revenue stream has been a Chamber priority since 2015 when DEFAC released its revenue report. This report highlighted how volatile Delaware’s revenues are and provided a blueprint on how to prepare Delaware for the future, putting it on a path toward sustainability. The state has undertaken some of that blueprint by making changes to Delaware’s escheat program and by changing how companies calculate their corporate income tax to a single sales factor. The next part of the process needs to happen now! A constitutional amendment, the first leg of which needs to be passed this year, would help create a true rainy day fund to be used in times of need, and added to in good times. In fact, the Joint Finance Committee itself voted this week to defer $46 million of this year’s revenue to future spending—exactly the way the budget smoothing process would be utilized. 

The benefits to budget smoothing are good for businesses, who won’t be subject to knee jerk reactions to raise money fast to balance a budget through tax and fee increases. It also helps Delaware’s nonprofits who receive Grant-in-Aid funding better plan year to year instead of facing last minute cuts in the down years and hoping for their replacement in the up years.

With revenues projected to be close to $500 million this year above last year’s budget, the time is ripe to make improvements to Delaware’s future. There’s no negative impact to funding, or to this year’s budget, and the case is strong to act now to plan for an uncertain future.

by James DeChene
​
In case you missed it, the News Journal, WDDE, and DE State News all had articles on a proposal by Governor Carney and Treasurer Simpler to create a budget smoothing process. Efforts would help avoid budget boom and bust cycles like last year where nonprofits and other agencies saw funding cuts. It helps the business community by providing certainty and avoiding knee jerk funding needs resulting in higher taxes and fees.

Here is a roundup of recent coverage on this issue:

• Governor Carney’s Statement on Budget Smoothing Report
• Panel seeks limits on annual spending growth in Delaware
• Delaware lawmakers propose revamping the budget process
• Report calls for change in state budgeting with spending limit​
• Bipartisan Budget Accord: Framing a Grand Bargain