2017 Legislative Recap

The Delaware General Assembly recessed on Sunday, July 2, 2017 for the year.  Here is a list of bills that ABC was watching throughout the session.  If you have any questions, please e-mail ecapodanno@abcdelaware.com

ABC defeats mandated apprenticeship program bill
Senate Substitute 1 to Senate Bill 76, a bill that all contractors and subcontractors are required, independently or through agreement with other organizations, to provide craft training for journeyman and apprentice levels through a bona fide program approved by and registered with the State of Delaware and/or United States Department of Labor for projects in which workers shall be paid the prevailing wage under §6960 of Title 29 was defeated.  ABC believes that training is an important part of any business but does not believe that the government should mandate participation in an apprenticeship program as a condition for bidding state work. This should be a choice that is made based upon how our members choose to run their business. In addition, the State of Delaware currently does not offer apprenticeship programs in 13 of the 26 prevailing wage classifications.  These companies would be excluded from bidding on state work even if they wanted to comply because the State doesn't offer the training. ABC was also concerned about the impact this will have on small and minority owned businesses that will not have the ability to meet this requirement.  For a copy of this legislation, click on http://legis.delaware.gov/json/BillDetail/GenerateHtmlDocument?legislationId=25931&legislationTypeId=6&docTypeId=2&legislationName=SS1

ABC supports Coastal Zone revisions
HB 190, a bill that would revise the Coastal Zone Act in Delaware passed the House and Senate and was signed by the Governor.  It had the support of ABC Delaware. This Act, which shall be known as the Coastal Zone Conversion Permit Act, makes changes to the Coastal Zone Act (“CZA”), which has not been significantly updated since its enactment almost a half century ago. The CZA, enacted in 1971, has enabled Delaware to preserve and protect our coastline, one of Delaware’s greatest natural resources. However, the CZA has also allowed property that has been in use by heavy industry for nearly 50 years, most suitable for similar industrial uses, to go unused unless the owner is willing to engage in the same heavy industry use or to use the property for manufacturing. This Act establishes a procedure to allow for the responsible, productive reuse of the 14 existing sites of heavy industry use within the coastal zone. Specifically, this Act provides that the Secretary of the Department of Natural Resources and Environmental Control (“Secretary”) may issue a conversion permit entitling the owner, operator, or prospective purchaser of an existing heavy industry use site operate an alternative or additional heavy industry use at a heavy industry use site. A conversion permit may also be sought for a heavy industry use site that had a docking facility or pier for a single industrial or manufacturing facility at the time the original CZA was passed in 1971, to engage in the bulk transfer of products produced in or used by a facility in the coastal zone. This Act specifies that the Secretary may not grant a conversion permit to operate any oil refinery, basic cellulose pulp paper mill, incinerator, basic steel manufacturing plant, or liquefied natural gas terminal not in existence on June 28, 1971. For a copy of this legislation, click on http://legis.delaware.gov/json/BillDetail/GenerateHtmlDocument?legislationId=25820&legislationTypeId=1&docTypeId=2&legislationName=HB190

ABC supported prevailing wage reform doesn’t move forward
The General Assembly did not move forward with reforms to prevailing wage that were proposed by ABC. The proposal included unlocking the prevailing wage rates so that all of them could be surveyed in the counties, mandating that the companies put their Delaware business license, permit number and contract number on all of the survey’s submitted and requiring the company owner to sign and certify that all the information on the survey’s submitted were accurate.  These proposals were included in the negotiations for the state budget but removed the last night of session.  ABC will continue to push forward with reforms to the prevailing wage survey.  For a copy of ABCs’ proposal on prevailing wage reforms, please e-mail ecapodanno@abcdelaware.com

State Capital Budget tops out at $590 million
The States capital projects budget passed the General Assembly on June 30, 2017.  The bond bill total is $590 million.  Here is the breakdown:  $120 million for school construction; $284 million for transportation projects; $35 million for the Delaware Economic Office; $46 million for the Office of Management and Budget; and $5.5 million each for Delaware State University, University of Delaware and Delaware Tech.  The rest of the bond bill went to Corrections, Delaware State Housing Authority and DNREC.  For a full copy of the State bond bill, click on https://legis.delaware.gov/BillDetail?LegislationId=25385

ABC supports passage of Mini Bond bill
SB 16, a bill that amends the Fiscal Year 2017 Bond and Capital Improvements Act to 1) authorize the expenditure of prior year Community Redevelopment Funds for public safety purposes in the City of Wilmington; 2) clarify the applicability of prevailing wage provisions on Community Transportation Fund and Municipal Street Aid projects; 3) authorize the Department of Transportation to use Community Transportation Funds for one-time reimbursements for various projects 4) allow for the use of certain operating funds of local school districts as a match for school construction; 5) allow Cape Henlopen to transfer certain unobligated major capital improvement funds for the Sussex Consortium Building project; and 6) to authorize the Office of Management and Budget to execute loan and collateral-related documents related to the New Castle County Courthouse parking facility was supported by ABC and passed both the House and Senate. For a full copy of this legislation, click on https://legis.delaware.gov/json/BillDetail/GenerateHtmlDocument?legislationId=25403&legislationTypeId=1&docTypeId=2&legislationName=SB16

ABC supports DEDO Public/Private Partnership legislation
HB 226, a bill recommending the establishment of a public/private partnership in Delaware to focus on investment attraction, entrepreneurship and innovation, talent development and retention, and research and analysis passed the Hour and Senate and was signed by the Governor. The Public/Private Partnership will focus on leveraging private resources to improve business recruitment, retention and expansion, identify and develop a talented workforce, connecting with the global economy and building a stronger entrepreneurial environment. To ensure public accountability the Partnership will submit to the Governor and the General Assembly tax returns, financial statements, organizational polices and will make available for inspection meeting minutes. To make the most efficient use of available resources, this legislation eliminates the Delaware Economic Development Office because the public/private partnership will be conducting business attraction and development functions formerly performed by that Office. This legislation transfer’s tourism, the Delaware Motion Picture and Television Commission and duties related to administration and the financial analysis of proposed economic development projects to the Department of State. The transfer will improve efficiency, eliminate redundancy and foster business attraction, innovation, tourism, small business development, business retention, minority, women, disadvantaged and veteran owned businesses. For a copy of this legislation, click on http://legis.delaware.gov/json/BillDetail/GenerateHtmlDocument?legislationId=25956&legislationTypeId=1&docTypeId=2&legislationName=HB226 \

Governor signs fiscal 2017 budget
Governor John Carney signed the $4.1 billion fiscal year 2018 budget early July 2. Highlights of the budget deal included: The state FY 2018 operating budget enacted in the early morning hours of July 3rd is 0.56-percent higher than the budget it replaced. The majority of the $364 million budget gap was bridged with spending cuts ($192 million or 52.75-percent of the shortfall).  New tax revenue accounted for 47.25-percent or $172 million. Of the new tax revenue, more than two-thirds (66.3-percent) came from an increase of the corporate franchise tax on large companies - a move that will raise $114 million in new revenue annually without impacting Delaware's desirability as a venue for incorporation. It contains no changes to the Personal Income Tax and preserves the ability of homeowners, those making charitable donations, and others to continue using itemized deductions. A proposal to increase the eligibility age (from 60 to 65) to exclude the first $12,500 of retirement income from taxation was eliminated. It restores funding to the Grants-in-Aid Bill to continue assistance to non-profit agencies at 80-percent of FY 2017 levels. The governor's recommended cut to the Educational Sustainment Fund was reduced by half.  School districts will not have the ability to recoup that money via a tax increase not subject to a referendum. Initiatives were started to look at ways to curtail Medicaid costs, explore the consolidation of Delaware's public schools, and create a new mechanism to limit the state's "growth and crisis" budgetary swings due to changing economic conditions. The Realty Transfer tax, which is levied on the sale of a home and typically spilt between buyer and seller, will be increased from three percent to four percent.  The revenue flowing to counties and municipalities from the tax will be unaffected. The tax on a pack of cigarettes will be raised by 50-cents per pack (half the dollar per pack sought by Gov. Carney).  A new, small tax will be levied on the sale of vaping liquid (five cents per milliliter). The tax on alcoholic beverages (beer, wine, and spirits), which has not been raised in 27 years, will be increased.  Even with the bump, Delaware's tax on all alcoholic beverages will be significantly lower than the taxes on the same products in all three neighboring states. For a copy of the full budget, click on https://legis.delaware.gov/BillDetail?LegislationId=25384