Op-Ed: Small businesses need solutions from Sacramento

Date: October 03, 2016

Related Content: News State California Economy

Small businesses need solutions from Sacramento
by NFIB/CA State Executive Director Tom Scott
and candidate for the 34th Assembly District Vince Fong
As published in the Bakersfield Californian Monday, October 3, 2016.
For small business owners, whether in the heart of the Central Valley, or nearly anywhere else across the State of California, each year seems to invite new and increasingly complex challenges from both natural and unnatural sources.
While our legislators may not be able to open the skies and make it rain, they certainly can compound the devastating impacts of the drought by passing legislation that makes California even more hostile to small, independent business owners.
We know that our hometown small business owners are the first to arrive at work, the last to leave, and the last to get paid. Our small businesses assume all of the risk and struggle every day to open their doors and help provide livelihoods to their hardworking employees.
Yet Sacramento politicians appear to be completely tone deaf to the needs and challenges these small business owners face in owning, operating and expanding their business. Sacramento needs to adopt a pro-small business policy agenda to help our local mom and pop businesses, and stop passing crippling mandates and regulations that stifle our economy.
One doesn’t need to look far for a list of examples of where we could start to improve California’s business climate. Since Proposition 30, California now has the highest income tax in the United States — and now Sacramento seeks to extend this “temporary” tax hike with Prop. 55 this November.
We also now have the highest state sales tax in the nation and the highest corporate tax west of the Mississippi. And at $800 per year, California has, by far, the highest minimum franchise tax, which is the annual fee paid to the state for starting a small business.
Beyond direct taxes and fees paid by small business owners in this state, there is a long list of indirect costs they also must bear as a result of governmental mandates. Just this year, our strict environmental laws were extended and expanded with Senate Bill 32 (authored by state Sen. Fran Pavley, D-Ventura), which imposes new burdens with little oversight.
By the year 2020, it is estimated that Cap-and-Trade will cost the average household nearly $4,000 per year due to increased energy costs which affect small businesses and the entire supply chain. Costly diesel regulations further exacerbate these challenges since anything you eat, wear, or use at one point must be transported on a truck.
California also leads the nation in hostile legal climate, which particularly hurts small businesses that do not have vast resources to fully understand and comply with complex federal and state accessibility regulations. There’s a reason California has been ranked the No. 1 “Judicial Hell hole” for several years in a row by the American Tort Reform Association, and that California is home to more than 40 percent of all ADA lawsuits in the nation.
In addition, just look at the latest onslaught of lawsuits being filed under the Private Attorneys General Act that has led to millions of dollars in settlements for missing periods and commas. The result is businesses closing their doors and employees losing benefits.
Although the California Legislature recently adjourned and the majority party celebrated a victory lap for sending a long list of “progressive proposals” to Gov. Jerry Brown, small business owners had very little to celebrate. This year we saw California’s already aggressive agricultural overtime laws vastly expanded by Assembly Bill 1066, which will hurt farmworkers by reducing their hours and ultimately raise food costs for all Californians. And of course there’s no way small businesses can ignore our state minimum wage of $15 per hour, which will have devastating ramifications.
A wide range of public policy issues will negatively impact small businesses owners — and it is critical to view them collectively and not just one issue individually. Our small businesses are being crushed by this piling on effect of additional laws and mandates from Sacramento and our unelected state agencies.
It is time for our legislature to stop viewing small business as a punching bag.
Vince Fong is running for the 34th Assembly District seat. Tom Scott is the National Federation of Independent Business’ state executive director.

Related Content: News | State | California | Economy

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