By James DeChene, Armitage DeChene & Associates
By Verity Watson, Ruggerio Willson & Associates
The Delaware Economic and Financial Advisory Council (DEFAC) held their May meeting with one more in June before the General Assembly passes the state’s Fiscal Year 2021 budget. While projections and estimates seem to change by the minute, there are a few things to be watching over the summer and into the fall related to economic recovery and what the impact to state expenditures will be in 2021.
As businesses adapt to large swaths of employees working from home, in many cases working more productively, significant changes to the dedicated physical space businesses require could be on the horizon. Downstream impacts, such as Wilmington’s wage tax, will require creative measures to insure solvency.
Corporate income tax and personal income tax filings are both predicted to take a significant hit next year. Personal income tax is the top revenue stream to the state, and while so far high wage workers have not suffered significant job losses, it will be interesting to see what the current 40% layoffs in hospitality workers translates into when federal unemployment ends in July.
All told, there remains much uncertainty—whether there will be a resurgence of COVID-19 in the fall and what that economic impact will look like, how changes made during this time related to how employees work will impact real estate, office environments, the work-from-home movement, and how all of these issues, and others, will further impact Delaware’s budget process.
A recent article in SFGate focused on how Maine’s aging population is putting a strain on the healthcare industry—from retirement homes to home health aides, there aren’t enough people to staff these jobs forcing closures and cuts to services, even if they are state mandated.
Maine now classifies as “super aged” meaning over one-fifth of its population is over the age of 65. By 2026, 15 other states, including Delaware, are expected to follow suit.
Let that sink in.
While Delaware touts itself as a retirement destination, and it certainly is (Hello, Sussex County) the flip side is the strain placed on care workers as more and more individuals require assistance and care. The cost to provide these services isn’t expected to decline any time soon, and as last year’s minimum wage debate highlighted, the cost to the state to increase reimbursements for direct support professionals ranges into the millions per year.
Delaware should be following closely the situation in Maine and the other 13 states, as we collectively advance to “super aged” status. We need to be looking at creative ways to lower costs for businesses so they can apply those savings to the inevitable cost of labor increases. For example, Maine allows businesses to pool together to purchase insurance under associated health plans, an idea the State Chamber and others has begun to flesh out.
It will take creative and innovative thinking to help solve these and other problems facing Delaware, and it will take the cooperative efforts of the general assembly, business, health care and other communities coming together to be successful.
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.
Earlier this morning the General Assembly finished their work for the first leg of this legislative session. Items of note included a budget that set aside close to $125 million in reserves for future years, the largest bond bill in Delaware history, and a grant-in-aid bill with more money allocated than in recent years.
Of specific note for the business community are the bills that did not find their way to passage, although many will return in January. They include a minimum wage increase, a tipped worker minimum wage increase, and the legalization of recreational marijuana.
The Chamber continues work on a number of items into next year, including finding creative ways to lower health care premiums for small and medium sized businesses, investments in workforce development and training opportunities for unemployed and underemployed workers, and finding innovative ways to attract and retain high level talent for employers looking to expand and relocate here in Delaware.
The State Chamber thanks you for your engagement this legislative session and we look forward to working with you next year in making sure Delaware is the best place to live, work and do business.
by James DeChene
The CZA Regulatory Advisory Committee met earlier this week for the fifth time. During the meeting, reports were given from the various working groups focusing on individual components of the legislation’s requirements, including how to account for sea level rise, providing financial assurance, and how to monitor bulk product transfer. Of the reports, an agreement of sorts was reached on definitions related to bulk product transfer, while the other topics will be revisited in future meetings based on the amount of material needed to review. Regulations are to be finalized by 10/1/19, and with a little less than a year left, there remains quite a bit of work to be completed.
The State Chamber’s Healthcare & Employer Advocacy and Education Committees hosted a joint event focused on the legal and human resources issues of opioids, drugs and alcohol in the workplace. Attendees were presented with three case studies involving small, medium and large businesses, with a variety of circumstances surrounding employee behavior, benefits and worst-case scenarios.
Next week is the State Chamber’s “Developing Delaware” event taking place in Dover at the Modern Maturity center. Focused on how Delaware compares with surrounding states when reviewed by site selectors, looking at Delaware “By the Numbers” and hearing success stories from around the state, this is a great opportunity to learn about economic development activity happening in Delaware. With over 200 attendees already registered, it will be a great networking event, too. To register, visit: http://web.dscc.com/events/Developing-Delaware-Conversation-Collaboration-Innovation-2175/details
by James DeChene
Two years ago, the State Chamber’s Healthcare Committee held an event on opioids to help employers to identify addiction in the workplace, find assistance for employees struggling with overcoming addiction, and shared examples of innovative employer policies that help to provide treatment options. The event was the first of two planned events, the second of which will be held October 10, 2018, and will be a joint venture between the Healthcare Committee and the Employer Advocacy and Education Committee. We hope you, your HR staff, and other interested people will attend.
Battling opioid and other substance abuse is a nationally recognized issue. Delaware employers are no exception in facing the challenges brought on by this crisis. Join the Delaware State Chamber of Commerce for an informative panel discussion regarding opioid and substance abuse in the workplace. Panelists will share a diverse set of case studies illustrating how employers can and should handle various situations that affect all businesses, from a mom and pop shop, to a large company with internal HR and legal staff.
- Tim Holly , Connolly Gallagher, LLP
- Paula Roy, ROY Associates
- Becky Flood, President & CEO, Ashley Addiction Treatment Center
- Tricia Clendening, SHRM-SCP, GPHR, SPHR, HR Strategies, LLC
- Kevin Fasic, Offit Kurman
- Shannon DeLucia, Hotel DuPont
- Jamie Danner, Senior Benefit Consultant, Kelly Benefit Strategies
Free to attend for DSCC Members / $15 admission for Future Members
Continental Breakfast will be provided
by James DeChene
On the heels of the Carney Administration signing a package of bills this week designed to help combat Delaware’s opioid crisis, the State Chamber will be holding a seminar for employers to learn more about strategies for handling opioids, drugs and alcohol in the workplace.
We will be presenting three employer case examples of opioid and alcohol abuse for panelists to discuss, and offer guidance and advice on how employers can/should handle the situations portrayed. The case studies involve a small “mom and pop” business with no HR capacity, a mid-sized employer (roughly 150 employees) with employee manuals, but no sophisticated HR capacity, and a large employer with in-house HR and legal staffs. The panelists will react to the studies presented, but also add useful insights or advice to Chamber members attending.
Opioids, Drugs and Alcohol in the Workplace
Wednesday, October 10, 2018
9:00 a.m. - 12:00 p.m.
Delaware Art Museum
2301 Kentmere Pkwy., Wilmington, DE 19806
Sponsorship opporunities available. Please contact firstname.lastname@example.org.
by James DeChene
This week in Dover featured the crush of bills needed to be heard before the end of session early morning July 1. Included were: modifications to the WARN Act (Chamber supported), the failure of the legalization of recreational marijuana (Chamber opposed passage), a bill allowing insurance companies to offer ERISA type plans to smaller employers (Chamber supported), and the supplemental spending bill that contains raises for state employees.
Still out there awaiting June 30 action are the bills related to minimum wage, the Workplace Fraud Act, sexual harassment training, and the bond bill, as well as whatever last minute surprises crop up.
As part of our Spring 2018 survey, we asked participants to list their top three policy concerns. We posed a similar question in our Fall survey with comparable results. Last survey, 50% of our survey respondents said that the Cost of Health Care was their #2 policy priority. We heard you loud and clear and are addressing this issue by working with partner organizations and stakeholders around the state.
With that question out of the mix in our current survey, members are telling us that Economic Development remains the #1 policy concern. That is followed education/work force development and permitting delays/regulatory issues.
By Mark DiMaio
In 2017, we invited Chamber members to participate in a survey in part to gauge their view of obstacles to their business growth. Listed below are the top five, along with ways the Chamber is addressing them.
1. Cost of Employee Health Care
The Chamber recognizes the growing problem surrounding health care costs.
2. Lack of Qualified Applicants
We are actively engaged, along with many of our members, with the Pathways to Prosperity program. Delaware Pathways programs are a set of curriculum focused on a specific industry-based “pathway,” paired with opportunities to gain workplace experience while still in high school, graduate with a head start on a college degree, or gain qualifications needed to go to work immediately. The program is a unique collaboration of school districts, businesses, higher education, and national advisory partners that represent a new way to do school. The Delaware Manufacturing Association (a Chamber affiliate) members have actively participated in the Manufacturing Engineering Technology and Manufacturing Production & Logistics pathways.
Delaware Pathways will host its 4th Annual Conference on March 21.
3. Concerns with Crime & Safety
The Chamber supports the efforts of elected officials and their staffs to reduce crime in Wilmington and across the state.
4. Concerns About Local Schools
Improving education outcomes is a key factor in developing a skilled workforce and attracting new business to Delaware.
5. Cost of Permitting and Regulation Compliance