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by James DeChene
This week saw action on bills important to the Chamber. First, SB74 provides employers taking advantage of the New Economy Jobs credit to prorate the credit over 12 months, rather than using the calendar year (Chamber supports). This would allow employers making hires at the end of the year a full 12 months to spread out the credit. SB21, creating the Transportation Infrastructure Investment Fund was released from House Transportation Committee (Chamber supports). A bill banning certain flame retardants in consumer products (HB117-Chamber opposes) was tabled in committee. A bill banning single use plastic bags (HB130) passed the House and now goes to the Governor for signature. The effective date for implementation is January 1, 2021. This session’s HB110, an act to legalize recreational marijuana, was introduced this week. As drafted the Chamber still opposes the language and will be working to insert language to protect employers. As previously noted, 71% of Chamber members oppose legalization. Last week the Chamber attended a working group focused on what the next round of renewable portfolio standard goals would be post-2025. The Chamber expressed concerns over how increasing renewables would impact Delaware commercial energy users, and to make sure that as technology continues to improve, Delaware doesn’t lock itself in to a certain type of renewable source. The General Assembly is off for the next two weeks before returning for all of June.
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by James DeChene
This week marked the first of the General Assembly’s two-week Easter break. DEFAC met this week and revised its forecast by an additional $42.8 million for this year, and roughly $16 million for FY20. Each of DEFAC’s meetings this year have seen revisions upwards. A reminder that the Governor has urged the General Assembly to set aside any such increases to be used for savings for future years and on one-time expenditures, like the Bond Bill. This week and next, I’ll give updates on the status of bills so far this session that have an impact to Chamber members: SB61 is a Chamber-supported bill that would create a Transportation Infrastructure Investment Fund (TIIF). It passed the Senate and now heads to the House for committee assignment. The bill creates a fund to help offset the cost of providing transportation-related improvements for commercial and industrial development projects, which will also help speed the process to project completion. SB65, the FAST bill, heads to the Senate for a vote. The bill provides up to $9K to Delaware high school graduates to obtain a non-degree certification. The Delaware Workforce Development Board will create an approved list of certifications, and the Chamber supports the bill. SS1 to SB 48, a bill to require apprentice and craft training on prevailing wage jobs, was released from the House Labor committee, and is ready to be voted on in the House. The Chamber opposes the bill as drafted and is working to amend it prior to the vote in the House. HB15 is a bill the Chamber opposes and would create two new top tax brackets: 7.1% for earners making $125K and over, and 7.85% for earners making $250K and over. SS2 for SB50 directs money from the bond bill to be issued to DelTech, along with bonding authority, to help address the college’s deferred maintenance issues reported on before. The bill’s main difference from the original SB50 is the removal of the statewide property tax provision as a revenue source. The bill is ready to be signed by the Governor. SS1 for SB25 was passed and the age to purchase tobacco is now 21 in Delaware. by James DeChene This week in Dover saw action in the Senate on a number of bills related to business. First, SS2 for SB50 directs money from the bond bill to be issued to DelTech, along with bonding authority, to help address the college’s deferred maintenance issues reported on before. The bill’s main difference from the original SB50 is the removal of the statewide property tax provision as a revenue source. Also in the Senate was SS1 for SB48, which mandates journeyman and apprentice craft training for those who work on publics works projects. The Chamber, ABC, Drive Delaware Forward, and others, worked unsuccessfully to modify the bill so that its passage would not adversely impact small businesses, or those businesses located where no training programs exist within reasonable distances (in some cases, apprentices must travel 80 miles each way to receive certified training). The bill now moves to the House where efforts to modify the bill will continue. Next week the General Assembly is out of session for JFC and Bond break. Upon their return, work will continue on criminal justice reforms, including the introduction of a revamp of Delaware’s criminal code. Stay updated on legislative issues through our Chamber Action Network video series as well. Sponsored by Ruggerio Willson.
by James DeChene
This week’s focus in Dover was on two bills directed toward the 500 federal workers living in Delaware currently furloughed. The first bill, which passed both the House and Senate, allows these workers to petition the court to halt eviction and/or loss of insurance policies or automobiles due to non-payment for the duration of the federal shutdown and for a duration of 120 days after. It would also limit the amount loan holders could charge during this time period, capped at 6%, no matter the original loan terms. The second bill, which passed the House, but failed in the Senate, would provide furloughed workers the opportunity to apply for state backed, low interest loans. Also this week the Governor announced his recommended budget. Of note to Chamber members was the outlining of how a newly created infrastructure fund ($10 million dollars) would be managed, allocating $15 million to colleges and universities toward economic development initiatives; adding $7 million additional funding in the Bond bill to UD, DSU and DelTech, allocated for deferred maintenance; and setting aside $12.5 million to Delaware’s Strategic Fund. The General Assembly will be in recess throughout February as the Joint Finance Committee will meet to hold budget markup sessions. They will return March 5. by James DeChene
As part of the State Chamber's Strategic Plan, created by staff and the Board of Directors last year, one of the initiatives included greater emphasis on engaging our members across the state. We questioned how we could be targeted in our outreach, and our plan included engaging members in each of the counties to help us inform our members on not only what the State Chamber is up to, but also to hear from our members on what issues are important to them. Last week, staff met with the newly created Advisory Committees in both Sussex and Kent counties. The meetings highlighted that while many of the issues our members face are universal (the looming budget deficit or the impact of a minimum wage increase), each county zeroed in on issues specific to their geography. In Sussex, tourism was the main focus of the discussion, but included issues such as infrastructure (the need for better east/west transit and public transportation) since much of the tourism and retail workforce lives in the western part of the county since it's cheaper to live there than at the beach. Items also included the potential of DEDO becoming a public private partnership and the impact felt by tourism. In Kent, the focus was on workforce development, specifically in the manufacturing community. Multiple attendees related how difficult it has been to recruit employees in technical fields and the hurdles they face to expand as a result. Members heard about workforce training programs available at DelTech, and with those discussion will come a plan on how to get skilled workers where they are needed. The goal is to have quarterly meetings with our Advisory Committees to continue the conversation on areas where businesses are seeing success, and where new issues are cropping up. We look forward to reporting back and we would like to thank our Advisory Committee members for taking the time to meet with us and share their ideas and concerns. Kent County Advisory Committee: Chris Baker, George & Lynch Rob Book, Delaware Electric Cooperative Buff Bruno, Edgewell Personal Care Justin Cressler, KraftHeinz Judy Diogo, Central Delaware Chamber of Commerce Jerry Esposito, Tidewater Utilities - Chair Sue Garson, WSFS Bank Michael Gast, M&T Bank Ron Gomes, Painted Stave Ken Hoffmann, PSCI Bob Keck, Calpine (Garrison Energy Center) Neal Nicastro, PPG Larry Rohlfing, Fulton Bank Justina Sapna, Delaware Technical Community College John Van Gorp, Bayhealth Hospital Stu Widom, Calpine Harry Williams, Delaware State University Lincoln Willis, The Willis Group LLC Sussex County Advisory Committee: Bill Allan, Delaware Community Foundation Rob Book, Delaware Electric Cooperative Barbara Brewer, Atlantic Sands Hotel Kevin Broadhurst, Comcast Lynn Brocato, Greater Seaford Chamber of Commerce Tommy Cooper, Cooper Realty Michael Elehwany, Miller Metal Carol Everhart, Rehoboth Beach – Dewey Chamber of Commerce Juan Flores, Invista Judy Johnson, Fulton Bank Richard Kenny, ShopRites of Delaware Alan Levin, SoDel Concepts Kristie Maravali, Bethany-Fenwick Chamber of Commerce Sean McKeon, Mountaire Farms Chris Moody, Delaware Technical Community College Chad Moore, The Bellmoor Inn & Spa - Chair Chris Perdue, Perdue Farms Betsy Reamer, Lewes Chamber of Commerce Rob Rider, O.A. Newton Rhett Ruggerio, Ruggerio Willson Associates Jo Schmieser, Chamber of Commerce of Milford Mark Stellini, Assurance Media Scott Swingle, WSFS Bank Alex Sydnor, Beebe Hospital Scott Thomas, Southern Delaware Tourism Chris Willett, M&T Bank by James DeChene
The impact of the 2016 Election Day results will continue to resonate for the remainder of the year. Above and beyond the obvious implications of Republican Executive and Legislative branches federally, here at home, Delaware has a Senate where a special election in early spring 2017 will dictate which party has control for the remainder of the 149th General Assembly. The pressing issues, however, remain. A major budget gap expected to be somewhere north of $300 million. An education system in need of reform in order to adequately prepare students for a career. A number of abandoned industrial sites currently sitting vacant, with limited prospects of seeing repurpose into economic development. An aging infrastructure system lacking dedicated funding to maintain, let alone expand, including road, rail, and clean water. The good news is that I believe that our elected officials in Dover have the ability to make the difficult decisions necessary to help set Delaware on a course of growth. If we take nothing else from this election season, I believe that citizens expect to be engaged by their elected officials to outline the important issues and challenges we face. By doing so, our elected officials will find they are given a large measure of leeway to act in the interests of their constituents by making what are admittedly tough choices. Examples can be seen in Wisconsin, Michigan, West Virginia and other states where sitting by no longer remained an option for their respective legislatures. The problems Delaware face are no different than our surrounding states, or many across the country. It is our size and ability to work together to tackle big problems that set us apart. It is my sincere hope that the next General Assembly and Governor work together, and by doing so continue to be an example to other states. By Robert Perkins
Executive Director, Delaware Business Roundtable PerkinsDelaware must fundamentally change its approach to economic development and nurture a growing entrepreneurship base in the face of intense competition for jobs, investment and talent, according to a framework commissioned by the Delaware Business Roundtable released on Wednesday. The Delaware Growth Agenda provides the private sector’s strategic framework for pursuing a new long-term approach to economic development in the state, including public policy recommendations centered on three strategic goals to be implemented over the next five years. “The vision of the Delaware Growth Agenda is that our state will focus its efforts on becoming a global magnet for leading-edge technologies, talent and investment,” said Mark Turner, chairman of the Delaware Business Roundtable and president and CEO of WSFS Financial Corporation. “This framework puts forth clear-eyed, achievable strategic goals and strategies that can accelerate Delaware’s economic engine – but only if the public and private sectors work together to make that vision a reality.” The non-partisan, forward-looking framework is based on interviews and guidance from more than 100 Delawareans, including representatives from economic development organizations, higher education institutions, businesses, government, labor and non-profit organizations. The framework envisions an even stronger and more robust partnership between the public and private sectors to guide future success. The framework recommends: Building an entrepreneurship and innovation ecosystem. This includes bolstering federal, state and private investment in higher education, and emphasizing the healthcare, science and technology fields, engineering and entrepreneurship programs. The framework calls for the creation of an “Innovation District” as a destination for entrepreneurs and startups, as well as for marketing Delaware to regional and national angel investors and risk capital networks. Pursuing a new approach to economic development. The framework calls for establishing a public-private economic development organization, crafting a new comprehensive statewide economic development strategic plan, and a marketing campaign that pursues new investment and jobs in key industries – including financial services, business services, education and knowledge creation, manufacturing, and distribution. Enhancing Delaware’s business climate. The Growth Agenda says the state must ensure Delaware’s infrastructure meets the needs of a 21st century economy, including updating the Coastal Zone Act to provide greater flexibility in redeveloping brownfield sites. The framework also calls for improving the state’s public education system, taking a leadership role in facilitating more efficient development and permitting processes, and creating a Futures Council of Delaware. The full recommendations under each of the goals and strategies can be found in the framework, which was developed collaboratively by TIP Strategies and the Delaware Business Roundtable. TIP Strategies is an economic development strategy firm that has worked with states and communities across the country. In addition to presenting a strategic vision and goals, TIP Strategies also examined Delaware’s economic health over time compared to other states in the region. Among the findings of the framework:
We are facing real challenges, but the Growth Agenda encourages a reset of economic development in Delaware over the next five years. First and foremost, things cannot continue as they have because Delaware’s existing companies – nor the industry sectors themselves – can be counted on to serve as engines of future growth. We must take a new approach, and the public and private sectors must work together to get it done. The Roundtable’s intention is for the Delaware Growth Agenda to spark a much-needed discussion of how to expand economic opportunity and jobs throughout the state during the 2016 election cycle that will result in concrete action thereafter. It comes on the heels of the Roundtable’s 2015 study of state finances, which clearly articulated the structural budget challenge facing the state as it wrestles with unsustainable revenue sources and spending patterns and strongly recommended that Delaware focus on expanding economic growth as one part of the solution. The Delaware Business Roundtable plans to continue to promote sustainable economic expansion and growth in Delaware. About the Delaware Business Roundtable The Delaware Business Roundtable is a non-partisan, volunteer consortium of CEOs whose companies collectively employ over 75,000 people in Delaware. Since its inception in 1981, the Roundtable’s broad mission is to enhance the quality of life in Delaware by promoting commerce, job creation and select public policy issues. In recent years, the Roundtable has been a leading supporter of public education transformation and entrepreneurs in Delaware. About TIP Strategies TIP Strategies, Inc. (TIP) is a privately held economic development consulting firm, with offices in Austin and Seattle. Established in 1995, TIP is committed to providing quality solutions for public and private sector clients. TIP has completed more than 300 engagements across 38 states and 4 countries. The firm’s primary focus is strategic economic development planning. In addition, TIP has experience with entrepreneurship, target industry analysis, workforce, and redevelopment. The firm’s methods establish a clear vision for economic growth. Community leaders across the country have embraced the TIP model of Talent, Innovation, and Place to achieve successful and sustainable economies. by Mark DiMaio
The Chamber’s Committees are in full swing, with the Transportation and Infrastructure Committee meeting to discuss the Coastal Zone Act (CZA) and recommendations from the Clean Water Task Force and the proposed DNREC regulations regarding storm water management. The committee continues to discuss the modernization of the CZA and how to best stimulate economic growth in the zone. The Delaware Clean Water Task Force is looking at a new draft bill related to water fees that focuses on a fixed fee per each Delaware business versus a fee for every business tax parcel. Concerns remain with the recently proposed DNREC storm water regulations. The committee will work with member companies to find a workable solution to the proposed regulations. The Chamber’s Economic Development Committee (EDC) held its kick-off meeting last week. The Committee discussion focused on Delaware’s current development climate and ways in which the committee could engage on issues. Much of the committee dialogue centered on the importance of keeping pace with the rapid economic changes both locally and nationally. The EDC will concentrate its efforts on both short and long-term topics and issues that will best advance Delaware’s existing business climate and foster an innovative environment for future development. In coordination with other State Chamber Committees, The Delaware Manufacturing Association and the Delaware Public Policy Institute, the EDC will work with stakeholders to advance policies to strengthen Delaware’s economy. by James DeChene
The second half of the 148th Legislative Session convened on January 12th, with a full docket of legislation carried over from last year to parse through, along with new legislation requiring action. Right out of the gate, the House faced a Suspension of Rules vote, brought by Rep. Kowalko, to override Governor Markell’s veto of HB 50, the “Opt Out” bill the State Chamber has opposed. That vote failed 13-26, but the bill has been placed on the Ready List, meaning it can be brought up for a similar vote at any time. In good news for Delaware business and overall economic development policy for the state, HB235, the Delaware Competes Act, passed the house last week with an overwhelming majority 36-2 with two not voting. The bill changes how corporate income tax is calculated in Delaware, changing from a multi-factor to a single sales factor calculation. Delaware is currently only one of nine states still using the multi-factor assessment, and the only one east of the Mississippi. This bill will ease the tax burden on companies looking to expand personnel and investments in property and infrastructure in Delaware, and has been endorsed by the State Chamber. The bill has its Senate hearing this Wednesday with a full floor vote on Thursday. It is expected to pass handily, and will be signed by the Governor. Also this week will be a hearing on SB 39, a bill to increase Delaware’s minimum wage by $.50 a year between 2016 and 2019, and then by $1.20 a year until 2023, where it will be $15.05 an hour. The State Chamber stands in opposition to this bill for a variety of reasons, including the impact on small businesses and potential loss of full time jobs, as seen in locales such as Seattle and Los Angeles. The bill is expected to clear the Senate Labor Relations Committee, where it will be brought to the Senate floor for a vote, as soon as Thursday. Plenty more to come in the coming months, so stay tuned. by James DeChene
Chamber Committee meetings have already started in 2016. With the General Assembly set to convene on January 12th, the Chamber’s policy committees are poised for action. Topics include the Healthcare Committee working to educate employers about the increase in narcotics/heroin addiction in Delaware, reducing the stigma of addiction, what signs to look for in employees and various treatment options available. Look for a spring event panel discussion to learn more. The Tax Committee will be looking at ways in which to help make Delaware more attractive for businesses to relocate to and expand in Delaware, and will be reviewing tax related legislation and regulations as they are drafted to provide feedback. The Transportation and Infrastructure Committee will be looking at the drafted Water Usage Fee bill that was created as the result of a Clean Water Taskforce. Chamber members have been participants on that taskforce and have provided industry knowledge to help craft the bill. The Employer Advocacy and Education Committee is expected to meet soon to discuss various labor legislation including an expected bill to increase the minimum wage in Delaware to $15 by 2023. The Environmental Committee will be having their spring event with a speaker TBD, and with potential changes to the Coastal Zone Act this year, they will undoubtedly have feedback to offer as well. For more information on how to participate on a committee, contact James DeChene at jdechene@dscc.com. |
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