Regulatory transparency, stopping of four mandates highlight accomplishments for small business
State Director Candace Daly reports from Salt Lake City on the small-business agenda at the end of the 2017 regular legislative session.
In the legislative lobbying world, NFIB is known as one of the better counter-punching associations, working to defeat bad-for-small-business bills before they advance too far. But there are times, regrettably not as many, when having NFIB’s support for passage of a measure gives that measure a margin of victory it might not have had.
The 2017 General Session of the 62nd Utah Legislature, which adjourned March 9, witnessed NFIB at both its counter-punching and victory-producing best, as the following demonstrate.
Regulatory Transparency Win
Of the 75 issues NFIB measures every four years and publishes in its Small Business Problems & Priorities report, “Unreasonable Government Regulations” came in second in 2016, a three-point jump from its fifth place in 2012. In a special poll just on regulations that NFIB conducted in 2017, it found that one-third of small employers have had a government official enter their place of business to inspect or examine their records and/or licenses or otherwise check on their compliance with some government requirement.
As part of its never-ending lobbying efforts to counter the debilitating effects of regulations, NFIB/Utah made passage of House Bill 272, sponsored by Rep. Brad Wilson, a top priority. The legislation, which passed the Legislature almost unanimously and was signed into law by Gov. Gary Herbert, will shed light on the rule-making process of government agencies.
This new law now requires:
- the Office of the Legislative Fiscal Analyst, when evaluating proposed legislation, to indicate whether the legislation would make changes in the regulatory burden for state residents or businesses
- state agencies, once legislation is passed, to analyze every possible means available to measure the effect of the new legislation before holding public hearings on proposed new administrative rules, to show the regulatory impact the rule would have on state residents or businesses
- the analysis to indicate whether each proposed rule will impact the regulatory burden and, if so, whether the impact increases or decreases the regulatory burden. It must also characterize whether the change in burden is high, medium, or low
- agencies to submit a summary of efforts made to comply with obligations to assure that new administrative rules minimize negative fiscal impacts on small businesses.
Secured Better Vetting of Ballot Measures Seeking Tax Increases
In another victory for transparency and forthrightness, NFIB supported the successful passage of House Bill 255, sponsored by Rep. Daniel McCay and Sen. Curt Bramble. Governor Herbert signed it into law.
To qualify an initiative for a statewide ballot in Utah, the initiative sponsors must gather signatures of registered Utah voters equal to 10 percent of all votes cast for president of the United States in the last General Election from each of at least 26 of the 29 state senate districts. In local elections, initiative sponsors must gather 10 percent to 30 percent of signatures of such votes cast, depending on the population of the local city or town.
HB 255 now adds an additional hurdle for statewide and local initiative sponsors seeking a tax increase at the ballot box. It requires that when an initiative or a petition for an initiative proposes a tax increase, the governor’s Office of Management and Budget must prepare an unbiased, good faith estimate of the fiscal impact of the law proposed by a statewide initiative. Similarly, for a local initiative, a local budget officer must prepare a similar report.
For statewide initiatives, sponsors must then hold seven public hearings throughout the state in specified districts. For local initiatives, similar public hearings must also be held. The bill’s sponsors proposed this measure to make sure that tax increases presented to Utah voters get a thorough vetting before they make it to the ballot box. It is intended to make sure that Utah continues to lead the nation in having well-thought-out tax policy.
Victories by Defeat
Four big victories for small business during the 2017 session came in the defeat of four measures, ones that would have imposed costly, time-consuming mandates. They were:
- House Bill 147, Living Wage Amendments, by Rep. Lynn Hemingway—Back for a fourth time in as many years with a few slight changes, none of which would have helped small businesses. HB 147 would have required that on and after July 1, 2017, and before July 1, 2018, the minimum wage to be $10.25 per hour. Further increases would have followed each year until the minimum wage reached $15 in 2022. Presently, the Utah minimum wage is $7.25 per hour. The bill also would have provided administrative rulemaking authority to establish a minimum hourly wage for minors that is different from the adult minimum wage and to change the minimum wage for tipped employees within the state to $5 per hour. NFIB/Utah succeeded in having the bill held in committee.
- House Bill 213, Workplace Discrimination Amendments, by Rep. Mark Wheatley—Would have limited the options for employers to address discrimination issues with employees, including the removal of mediation as an option to resolve disputes. Under this bill, employee discrimination charges would more likely need to go to court, resulting in higher costs for small-business defendants. NFIB was instrumental in getting this bill held in committee.
- House Bill 242, Family and Medical Leave Amendments, by Rep. Dixon Pitcher—Would have required an employer who employs between 30 and 49 employees to comply with the federal FMLA laws. Currently, only employers with 50 or more employees are required to comply with federal FMLA law. The 1993 federal law exempted smaller businesses from the law’s obligations, understanding that the burdens are too great for small businesses to absorb. NFIB/Utah worked with the sponsor to help him understand what this bill would require. Once he finally understood everything that was involved, he voluntarily held the bill.
- House Bill 153, Uninsured and Underinsured Motorist Coverage Amendments, by Rep. Michael Kennedy—Would have required employers to purchase uninsured and underinsured coverage for their employees who drive their own cars while working. Such a requirement would have unnecessarily increased costs for many small businesses. NFIB stood firm in helping defeat this unwise proposal.
FYI: One-Time 2018 Tax Credit
Because of the many contortions Senate Bill 109 went through from its first introduction to final passage, NFIB did not support it, but small-business owners should be aware of it and its one-time opportunity.
SB 109 allows small employers, those with at least 10 but fewer than 20 employees, to apply for a one-time $500 nonrefundable tax credit for the 2018 tax year. To qualify, the 2018 tax year must be the first year that the employer offers a qualified retirement plan to their employees. Retirement plans offered must be “qualified” plans under federal retirement law. To find out more about qualifying for this new one-time small business tax credit consult your tax accountant.