By James DeChene

On November 8th, Delawareans will head to the polls to choose candidates who will face big issues in 2017, both in Congress and here at home. Focusing on Delaware, the next Governor and General Assembly will tackle how our state government raises and spends money, on what programs and services the government will offer, and how to continue to build upon the recovery from the Great Recession. There are no easy answers to these issues, as has been documented in this space over the last months, yet the important issues of long-term economic stability, making Delaware an attractive place for businesses, and properly preparing Delaware students for the workforce remain.

Election Day is your opportunity to help shape the path of Delaware’s future. As Chamber of Commerce members, you are invested in this state, both professionally and personally, as are your employees. The decisions you make next Tuesday in the voting booth will have a direct impact on your life here in Delaware. While you may be suffering, as I certainly am, from election fatigue, I urge you to take the time to learn about the candidates in your district and make an informed decision on November 8th.

by James DeChene

This week, former Governor Mike Castle was the speaker at the Chamber’s Leadership series. He spoke on a variety issues, but focused on, how as a leader in public service it was important to surround himself with talented individuals and allowing them the leeway to do their job well.

Providing insight on his entrance into public service, from helping to organize the Young Republicans group, to his run for the State Senate, his time as Lt. Governor, Governor and ultimately Delaware’s Congressman for 18 years, he commented that many of his successful initiatives started from conversations he had with constituents, such as focusing on Delaware teacher pay and the importance of early childhood education. He also emphasized the role of government is not to create jobs, but to create an environment where businesses can grow and flourish, highlighting that as governor Delaware enjoyed one of the most prosperous times in the state’s history.

Governor Castle also spoke about the tone and tenor currently in Washington, D.C. Pointing to Delaware and its history of working together to solve important problems, like how the parties came together to create the Financial Center Development Act, Governor Castle was lamenting the relatively recent polarizing ideology from both parties that has crippled Congress’ ability to tackle and solve the important problems we face, a record national debt, the need for meaningful tax reform policy and for an education policy that prepares young Americans for life after school.

by James DeChene

This week, 21 states and over 50 business groups, including the U.S. Chamber of Commerce, the National Association of Manufacturers and the National Retail Federation, filed multiple lawsuits against the Department of Labor. All were seeking to overturn regulations that would change how millions of Americans are compensated for their labor by making them eligible to receive overtime pay.

Specifically, the salary threshold for exempt executive, administrative, and professional employees will increase to $47,476 per year (or $913/week), meaning that salaried employees earning less than this amount, regardless of job duties, must be compensated for overtime work.

Both lawsuits said the Department abused its authority by increasing the salary threshold so drastically, and failed to account for regional variations in the cost of living. In addition, the lawsuits claim the Department of Labor violated federal law by indexing the salary threshold to the 40th percentile of income, with automatic increases every three years.
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It is currently unclear as to whether the lawsuits will force the Department of Labor to delay implementation of these pending regulations. However, the Eastern Texas District where the lawsuit was filed is known as a “rocket docket” court where cases move along quickly. The State Chamber of Commerce will keep you informed with updates as they happen.

​by James DeChene

There are many competitive Delaware primaries in most of the races this year and it is unclear (as of now) who will win.  Up and down the state, and in both parties, on September 13th the outcomes will shape the narrative for the November general election and beyond.  In January there will be a new member of Congress, a new Governor and Lt. Governor, an inducted 149th General Assembly and many important county and local positions will be filled such as County Executive and City of Wilmington Mayor.
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A reminder email will be sent to Chamber members highlighting which races have primaries and inwhich races the Chamber’s PAC has contributed to a candidate.  Remember—it is important for the business community to vote and be actively involved in the legislative and regulatory process.  Laws and regulations are created and promulgated that have direct impact on your business and how it operates.  This election season is the time for your voice to be heard by those who are asking for your vote to represent you in Washington, Dover, your county and in your town—make sure you take the time to make an informed decision on who you want to be your voice.

by James DeChene

August 20th is the deadline for those who wish to vote in Delaware primary elections to be held on September 13th.  In addition to being able to register at DMV or at your local library, the easiest way is online: ivote.de.gov.  There are a number of races featuring primaries this year, all candidates for which can be viewed in the PDF linked below.

DE 2016 Primary Election Candidates

​by James DeChene
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The Dog Days of Summer are upon us. The last two weeks have been filled with national party convention drama, heat waves making for great vacation/beach weather (see you next week, Lewes), and mixed in are polls for the City of Wilmington mayoral and Congressional races, with results showing that many people are not yet focused on local elections. Faster than some sunburns will fade, Fall and the September primaries will be here, and, as the State Chamber has mentioned (repeatedly), there are hot button issues on the horizon next year. Many of them have been outlined in the recent Delaware Business Roundtable’s Growth Agenda (available for your beach reading pleasure), and can help serve as an election guide for the business community to choose who is best served to help guide Delaware into the future. For now, we hope you enjoy your summer, that your AC is working, and that you’ll spend some time reading up on your specific candidates up for election.

By James DeChene

As reported this week in the News Journal, Delaware received unfortunate news from FERC regarding the Artificial Island cost allocation proceedings. The agency has decided not to intervene in the cost allocation debate on whether Delaware rate payers should shoulder roughly 90% of the cost burden of constructing a power line across the Delaware River. Back in December, in response to the claims raised by the Delaware and Maryland Public Service Commissions (Docket EL15-95-000), regarding the cost allocation made by PJM as to who would pay for a new transmission line to be constructed between New Jersey and the Delmarva Peninsula, FERC determined that the cost allocation for Artificial Island filed by the PJM transmission owners may not be just and reasonable. FERC therefore accepted the cost allocations but delayed implementation for 5 months (subject to refund if FERC denies the cost allocation) and established a technical conference with PJM to determine whether there is a certain category of reliability projects for which the solution-based DFAX may not be appropriate and whether another cost allocation method could be established for such projects.

With that 5 month deadline came with it FERC’s response, along with news that the project will now exceed $400 million dollars, an increase of $135 million over last cost estimates. The ruling will be appealed, and the potential for a court case challenging the cost allocation remains prominent.
More details to follow as we know them.

​by James DeChene

Over the last 7 years, Governor Markell has made education a primary policy focus.  Changes in student curriculum, creating new standardized testing standards, adoption of long-term performance goals, and significant investment in early childhood education have all been part of an over all strategy to help Delaware students raise their achievement levels.  The State Chamber of Commerce has supported many of these initiatives because we believe today’s students are tomorrow’s workforce.

This year, Governor Markell has allocated $11.3 million for early childhood development targeted at pre-kindergarten aged children.  Recent research has focused on early education as an investment.  The National Conference of State Legislatures has prepared a summary of the latest economic research examining early education initiatives as public investments.  Many policymakers have considered early education initiatives as a school readiness strategy or as a way to close the achievement gap.  Now, economic experts are offering another reason: mounting evidence shows that investments in early education may be considered as an economic development strategy.

According to NCSL, their summary brief “highlights three reports: the first from Art Rolnick, Senior Vice President and Director of Research at the Minneapolis Federal Reserve Bank; the second from James Heckman, Nobel Prize winner in economics from the University of Chicago; and the latest report from the High/Scope Educational Research Foundation on the longitudinal study of the Perry Preschool Program.  These reports characterize the economics of investing in early education by examining state economic subsidies, skill development for individuals in the broader economic picture, and specific new findings from a path-breaking early education program.”
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For more information on how important early education investment is to the business community, click here to read more.

​As reported last week in the News Journal, Delaware recently received good news from FERC regarding the Artificial Island cost allocation proceedings.  In response to the claims raised by the Delaware and Maryland Public Service Commissions (Docket EL15-95-000), regarding the cost allocation made by PJM as to who would pay for a new transmission line to be constructed between New Jersey and the Delmarva Peninsula, FERC determined that the cost allocation for Artificial Island filed by the PJM transmission owners may not be just and reasonable.  FERC has therefore accepted the cost allocations but delayed implementation for 5 months (subject to refund if FERC denies the cost allocation) and established a technical conference with PJM to determine whether there is a certain category of reliability projects for which the solution-based DFAX may not be appropriate and whether another cost allocation method could be established for such projects. Paragraphs 34 and 35 of FERC’s order, below, are the most significant for Delaware.  This is a fantastic initial order from FERC.
34. Our preliminary analysis indicates that the assignment of cost allocation for the proposed Tariff amendments in Docket No. ER 15-2562-000 Filing and Docket No. ER15-2563-000 have not been shown to be just and reasonable and may be unjust, unreasonable, or unduly discriminatory or preferential. Accordingly, we will accept the proposed Tariff revisions for filing, suspend them for five months, to become effective on April 25, 2016, or an earlier date set forth in a subsequent order, subject to refund, and the outcome of a technical conference in the complaint proceedings, Docket Nos. EL15-18-001, EL15-67-000, and EL15-95-000.
35. We direct staff to establish a technical conference to explore both whether there is a definable category of reliability projects within PJM for which the solution-based DFAX cost allocation method may not be just and reasonable, such as projects addressing reliability violations that are not related to flow on the planned transmission facility, and whether an alternative just and reasonable ex ante cost allocation method could be established for any such category of projects.

​ Governor Markell today announced $600,000 in grants for new high school pathway programs to expand a statewide effort that prepares students to excel in key fields that offer good job opportunities in the new economy.
Beginning next fall, the Governor’s Pathways to Prosperity initiative will serve more than 5,000 students in at least 55 pathway programs at 29 high schools. That more than doubles the size of the initiative from this fall, when it launched with 25 pathways in 15 high schools across the state, impacting more than 2400 students. For this second round of grants, the state has added pathways in computer networking, finance, and health care. Those are in addition to pathways in biomedical sciences, engineering, hospitality/culinary arts, IT/computer science, and manufacturing.
The Governor previously announced $500,000 in grants for pathways that started this fall. Moving forward, the state plans to provide districts the chance each September to apply for funds to start new pathways in emerging industry sectors.
“I applaud the district administrators, teachers, higher education leaders, and employers who have made it a top priority to provide these opportunities to our students,” said Markell. “They have allowed this initiative to expand at an incredible rate, recognizing that these opportunities are vital to give all of our young people the best chance to reach their potential. Working together, we will ensure every student can not only participate but thrive in the job market into which they will graduate.”
Grant funds are used by school districts to implement career and technical education programs of study as part of a larger state effort to connect our public education system, post-secondary institutions, and our employer community. Students take hundreds of hours of specialized instruction and hands-on training, receiving the opportunity to graduate with work experience and college credit for courses that are most relevant to those industries. That means they can have a head start on getting a job and earning a degree.
Each program was developed in partnership with Delaware employers and institutions of higher education. The Department of Education is providing curriculum support for each pathway as well as training for teachers to successfully implement the coursework. In addition, the Department is working on agreements with Delaware colleges and universities to ensure that students who complete a program will be eligible for college credit at one or more institutions of higher education in the state.
The just-announced $600,000 includes some funds to help expand programs already underway this fall.
“This program epitomizes the collaboration among teachers, administrators, and the larger education community that is necessary to best support our students,” said Secretary of Education Steven Godowsky. “The Department of Education continues to be committed to partnering with our school leaders and offering our school systems the support they need to effectively implement the rigorous career and technical programs that are a key part of ensuring all students find success after high school.”
Districts use funding in a variety of ways to support students and staff, and to provide the services and materials required to offer courses and hands-on training opportunities.
“Today’s jobs simply do not look like those of decades past, which are increasingly outsourced to other countries or handled by machines,” said Markell. “However, incredible opportunities exist for those who can use that technology and for those whose abilities fit with the changing needs of growing industries. It’s our responsibility to ensure there are pathways to learning the skills for those jobs.”