by James DeChene

​Before we get to what happened in Dover this week, a reminder that our networking event at the Delaware National Guard Joint Force Headquarters is a week away. This is your chance to:

1. Network with members of both the State Chamber and the New Castle Country Chamber.
2. Chat with Governor Carney who will be in attendance.
3. Meet the incoming Adjutant General, Brig. Gen. Michael Berry.
4. Witness demonstrations by the DNG's 31st Civil Support Team and Counterdrug Task Force.

 
And now onto Dover. This week the JFC continued to hold meetings hearing budget requests from state agencies. I attended the Departments of Insurance, Labor, and Natural Resources and Environmental Control (DNREC) hearings, and each secretary gave a good overview of what their offices are doing and plans for next year. A few items of note included the work the State Chamber, and others like ABC, DCA, Labor and legislators, have done to address issues related to the Workplace Fraud Act and how work is performed on construction sites. That work continues, and I’m thankful that we’re reaching consensus on some big issues that will have a positive impact on the industry and its workers.

Of note from DNREC, Secretary Garvin made the announcement of a website launch in the coming month that will track permit applications made to the department. As you know, the State Chamber has been working with agencies like DELDOT and DNREC on streamlining their permitting processes to help development projects become 'shovel ready' faster. This tracking mechanism, apparently similar to what DELDOT has created, will show not only delays, or speed, from the DNREC side but also track if applications are missing data, causing a slowdown from the business side.  More to come once the website goes live.
 
Hope to see you next week at the Guard event.

by James DeChene
​
Following a week where Governor Carney released his 'State of the State for Delaware', outlining his priorities that included Coastal Zone Act modernization, a renewed focus on economic development and growth, and continuing gains made in education policy, this week was relatively quiet by comparison.

A number of bills were either introduced or heard in committee this week that would have an impact on Delaware businesses.

HB80, a bill that would limit the number of rating factors insurance companies can use to quote auto policies was tabled in committee to allow for the Insurance Commissioner and insurance industry to work towards consensus. The Chamber is monitoring this legislation.

HB109 was released from committee, which would create two new top tax brackets at 7.1% for income greater than $125,000, and 7.8% for salaries over $250,000. Included in the legislation is a provision to eliminate itemized deductions in these brackets over the next few years. The Chamber opposes this legislation.

SB20, the second leg of a constitutional amendment to create a lockbox for Transportation Trust Fund dollars was released from committee. The Chamber supports this legislation.

HB45 with HA1, was released from committee and deals with the Attorney General’s Consumer Protection Unit’s functions. The Chamber worked with the AG’s office and bill sponsor to amend the language. The Chamber supports the measure as amended.

HB1 was introduced this week, which would ban employers from asking candidates during an interview for their salary history. Employers would still be allowed to inquire as to an applicant’s salary expectations. Roughly 50% of Chamber members asked say they do not formally ask for salary history, and the Chamber’s Employer Advocacy Committee will be reviewing the legislation at their upcoming meeting.

The General Assembly will be on Easter Break for the next two weeks, returning Tuesday April 25.

By James DeChene
This week saw the General Assembly return from their Easter break.
Of note to the business community, HB 308 was heard in, and released from, the House Administration Committee on Wednesday. The bill was written in response to a Superior Court decision involving a worker’s compensation claim made by a state employee, who also attempted to collect on the state’s underinsured motorist policy to help cover medical expenses. The court found that the employee was only entitled to collect worker’s compensation and granted the State a motion of summary judgement. However the judge asked for legislative clarification regarding the instances where other insurance policies could be utilized (such as uninsured/underinsured, short-term and long-term disability). The issue at hand is that the legislation is written broadly enough that it potentially impacts private sector insurance rates. The State Chamber testified at the hearing, raising questions as to impact on other insurance rate increases as a result of workers compensation insurance no longer being exclusive. The bill now heads to the House floor after the JFC/Bond Bill hearings break for a full vote.
Until next week…

​This past week several events focused on Delaware’s fastest growing financial services industry- captive insurance. On Monday, November 9th, Governor Jack Markell issued a proclamation honoring the growth of Delaware’s captive industry. Under Insurance Commissioner Karen Weldin Stewart’s leadership, the number of Delaware active licensed captive  companies has grown from 38 in 2009 to over 1,000 today. Delaware presently is the third largest captive domicile in the United States and also ranks as the sixth largest domicile in the world.
On November 11th and 12th, the Delaware Captive Insurance Association held their annual forum. The DCIA, a private industry group, is comprised of service providers (attorneys, accountants, and captive managers) for our captive industry. The forum held at the Chase Center, drew approximately one hundred fifty attendees.
As part of the forum, Commissioner Stewart recognized Delaware’s 1,000th active licensed captive – AWI, Inc. Its’ parent company- American Water is a publicly traded company (NYSE: AWK) founded in 1886. American Water is the largest publicly traded water and wastewater utility company in the United States, employing almost 7,000 professionals, serving the needs of 15 million customers in 47 states and Canada.
In her remarks, Commissioner Stewart noted that American Water- already incorporated in Delaware- chose to form its captive insurance company here due to the professionalism and accessibility of the Insurance Department’s Captive Bureau staff and Delaware’s reputation as a business – friendly jurisdiction. Deb Degillio, President of AWI, Inc. proudly accepted the honor of being Delaware’s 1,000th captive insurance company.

The Insurance Commissioner’s  decision for 2016 Workers Compensation  rates is disappointing, but certainly better than those proposed by the Delaware Compensation Rating Bureau. The position of the members of the Workers Compensation Oversight Panel, which is chaired by myself,  is that rates should be in the range proposed by the Panel’s independent actuary, which recommended a 2-3% increase.
The State Chamber along with the other members of the Oversight Panel will continue to look for ways to lower Delaware’s workers compensation rates.
The statement is below:
​Insurance Department Announces Workers’ Compensation Rates for 2016

DOVER, DE (November 17, 2015) – Insurance Commissioner Karen Weldin Stewart today approved the Delaware Compensation Rating Bureau (DCRB)’s workers’ compensation amended rate filing, resulting in an overall average increase of 7.09% in residual market rates and 7.20% in voluntary market loss costs.
The DCRB originally proposed overall increases of 14.92% for the residual market plan and 15.03% for the voluntary market loss costs. The Commissioner’s independent actuaries and the state’s Ratepayer Advocate each examined DCRB’s filing and recommended increases lower than the ones requested by DCRB. Following extensive discussions, the three parties proposed the amended rates which the Commissioner approved today.

In late June, the Supreme Court of the United States released their decision on the highly publicized King v. Burwell case regarding the Patient Protection and Affordable Care Act.  The Court considered two possible scenarios in its decision:

1. Adhere to the strict reading of the law that subsidies may only be available in exchanges established by each state. This would leave consumers of states that opted into the federal exchange unable to apply for tax credits.
2. Rule based on the intent of the law for universal availability of subsidies in all states and all exchanges. This would allow all eligible consumers whose coverage is through the exchange to apply for tax credits.

The Court’s decision states that subsidies will continue to be available for all eligible consumers who purchase health insurance through the exchange in all states, not just in those with state-based exchanges.  Delaware has a “partnership” exchange where the state and federal government work together.  There are a significant number of Delawareans currently receiving tax credits to reduce their insurance premiums for the plans purchased through the FFM (Federally-Facilitated Marketplace exchange).  Delawareans were at risk of losing their tax credits had the Court ruled under the strict reading of the law.
Now, consumers who purchase health insurance coverage on their own need to focus on what to do next.  Here are key dates that consumers should discuss with their agent or broker:

• November 1st, 2015: Is the beginning of the “open enrollment” period where consumers can select and enroll in a 2016 plan.  It is also the time for currently enrolled consumers to make changes to their plan for 2016.
• December 15th, 2015: Is generally the last day to enroll in a new plan that will begin on January 1st, 2016.
• January 31st, 2016: Is the last day of the “open enrollment” period.  There will not be another opportunity to purchase coverage without a “qualifying life event” until the following year’s open enrollment.