The Delaware General Assembly recessed on Tuesday, June 30, 2009 for the year. Here is a list of bills that ABC was watching throughout the session. If you would like copies of these bills, please e-mail ecapodanno@abcdelaware.com
State Balances Budget through tax increases and pay cuts
The General Assembly put together a mixture of tax increases, pay cuts and state employee attrition to balance the largest budget deficit in State history. The budget deficit reached $800 million. The budget includes the following: $55 million from sports betting/increased gambling share; $230 million from the federal stimulus money; $211 million in tax increases including personal income tax increase, gross receipts tax increase, cigarette tax increase and others; and $301 million in cuts which include 2.5% cut in state salaries across the board and $13.7 million in job attrition. Among the tax increases of note are: 1% personal income tax increase across the board for all individuals making $60,000 or more a year. This tax will expire in four years; 8% increase in the gross receipts tax; re-establishment of the estate tax which will expire in four years; increase in fees for alcohol licenses and public documents such as birth and death certificates; and establishment of a tax on tanker-to ship oil transfers in Delaware waters. For a full copy of the State budget, click on http://legis.delaware.gov/legislature.nsf/Lookup/CGO_AppropriationBills?open
State Capital Budget tops out at $284.4 million
The States capital projects budget passed the General Assembly on June 30, 2009. The bond bill total is $284.4 million with the following breakdown: $137.7 million for school construction; $72.9 million for transportation projects; $73.9 million for the Kent County court complex; and $3 million for Delaware State University, University of Delaware and Delaware Tech. The rest of the bond bill went to the Office of Management and Budget and the Delaware Economic Office. The bond bill includes $74.7 million in school construction projects that were not funded in the 2008-2009 capital budget. The money came from last year’s one-time windfall of unclaimed property. For a full copy of the State bond bill, click on http://legis.delaware.gov/legislature.nsf/Lookup/CGO_AppropriationBills?open
Statewide Plumbing code passed
Senate Bill 160, ABC’s legislation to mandate a statewide plumbing code passed both the Senate and House. It is awaiting the Governor’s signature.ABC believed a uniform statewide plumbing code that is updated every three (3) years would create much needed standardization to our industry and allow contractors to work throughout the state under the same code. Right now each town, municipality and county can adopt its own plumbing code. Support for this legislation included: Plumbing Heating Cooling Contractors, Delaware Contractors Association, State of Delaware Division of Public Health, Home Builders Association of Delaware, New Castle County, Kent County, Sussex County, City of Wilmington and Local 74, Plumbers/Pipefitters Union.
Prevailing Wage bills tabled
ABC introduced several bills this year that would have reduced taxpayer burden with regards to the state prevailing wage system. None of the bills reached the floor for vote. Here is a synopsis of each bill. House Bill 110 – a bill that would exempt Delaware public schools from prevailing wage rates for 4 years while the State does a comprehensive study to determine the actual effect on the budget and wage rates for construction workers. House Bill 141 – this bill raises the dollar threshold for public works projects subject to the prevailing wage requirement to $350,000 for new construction and $100,000 for alteration, repair, renovation, etc. House Bill 145 – a bill that provides that if the prevailing wage rate is not determined by the collective bargaining rate, then the rate determined shall be the rate for fives years, subject to raises directly to the raise for State employees. The bill also mandates that contractors who want to bid on State capital projects must have filled out survey. House Bill 153 – a bill that allows state agencies to opt out of prevailing wages to be paid to mechanics and laborers performing work on public works projects. ABC will look to re-introduce these bills in January 2010.
Open government bill passes General Assembly
The Delaware General Assembly passed House Bill 1, a bill that allows the public to have access to meetings of the Delaware General Assembly except for caucuses. Additionally, the bill allows the public to have access to records of the Delaware General Assembly. The current exceptions that apply to public bodies and public records would apply to meetings and records of the Delaware General Assembly. ABC supported the passage of this legislation.
New regulations on independent contractors becomes law
The Delaware House and Senate passed House Substitute Bill 1 for House Bill 230, a bill that puts regulations on independent contractors. It provides administrative remedies and civil penalties against an employer who knowingly misclassifies an employee as an independent contractor. State and federal government agencies, sole proprietors and single member corporate or business entities are exempt from the legislation. ABC worked with members of the General Assembly to craft House Substitute 1 after opposing the original House Bill 230. The Department of Labor will be responsible for adopting regulations necessary to enforce this Act. ABC will be part of this process over the summer months.
Forty ABC Delaware members spent the afternoon visiting Legislative Hall in Dover May 13 as a part of our annual Legislative Day. Members in attendance were briefed on ABC issues and legislation we are proposing with regards to prevailing wage, statewide plumbing code, standardized inspections, and preference to Delaware contractors on money allocated by the federal stimulus package.
Members heard from Representatives Tom Kovach (below left), Mike Ramone, Bryon Short (below right) and Senator Karen Peterson (below with ABC Delaware President Ed Capodanno) on the 2010 State budget, bond bill, open government legislation, small business initiatives, and economic development. After the briefing session, members were able to attend legislative committee meetings on bills or meet with their State Representative or Senator on ABC issues or other issues affecting their business as well as touring the chambers of the House & Senate (pictured below).
If you would like copy of ABC issues for this legislative session, please e-mail ecapodanno@abcdelaware.com.
Governor Jack Markell discussed his solutions to the State of Delaware $750 million dollar deficit in next year’s budget with over 100 ABC members at breakfast April 6.
Governor Markell stated that his budget solutions are driven by three principles: compassion, fiscal responsibility and shared sacrifice. Closing the $750 million gap will require a combination of spending cuts and new revenue. The budget solutions contains: $331 million in spending reductions including an 8% cut in state employees salary across the board; $40 million in reallocating of special funds; $166 million in increased revenue including a $.45 cigarette tax, a 50% increase in the alcohol tax, personal income tax increase of 1%, corporate franchise tax increase, gross receipts tax increase, and a public utility tax increase; $155 million from the stimulus package; $55 million from authorizing a sports lottery and increasing the share of casino revenue to the State from 37% to 45%; and $12 million in fines and fees. Under the State constitution, the annual budget must be zero when the fiscal year begins on July 1, 2009. The Governor’s budget proposal has been forwarded to the General Assembly who will debate his proposal over the next three months. ABC will keep you updated on the progress of the budget negotiations.
If you would like a copy of the Governor’s presentation, please e-mail jtoman@abcdelaware.com and you can see all the budget items listed above.
ABC members traveled to Washington in early April and met with the Delaware Delegation on the Employee Free Choice Act (EFCA). Individual meetings with Senator Tom Carper, Senator Ted Kaufman and Congressman Mike Castle were held to discuss the negative impact this legislation will have on businesses in Delaware.
Congressman Castle expressed that he would be voting No on the Employee Free Choice Act. Senator Carper noted he is opposed to the elimination of the secret ballot election and provisions of the binding arbitration and would not support the legislation. He noted that he felt a compromise should be forged between labor and business. Senator Kaufman is supportive of the legislation and believes that making unions stronger will increase the median income for working men and women.
The Employee Free Choice Act was recently introduced into the United States Senate and House of Representatives. This act would change labor law in three major areas: The process by which unions are permitted to organize; the conditions under which employers must negotiate; and the penalties associated with Unfair Labor Practices. ABC is strongly opposed to the Employee Free Choice Act and ask that you consider contacting members of the Delaware delegation to voice how this bill will harm your business.
For more information on EFCA, visit www.thetruthaboutefca.com or www.myprivateballot.com. For information on how to contact your Congressman or Senator, e-mail ecapodanno@abcdelaware.com.