For the legislative and political week August 3-7
Welcome to the August 3 issue of the NFIB California Main Street Minute from your small-business-advocacy team in Sacramento.
Ahead This Week
- Senate Bill 1383 comes up for a vote in the Assembly. Among other things, it would allow an employee to take up to 12 workweeks of unpaid, job-protected leave during a 12- month period for specified family care and medical leave reasons; guarantee reinstatement to the same or comparable position, as specified; and continue group health coverage during the duration of the leave. The bill would apply to businesses with five or more employees. NFIB will be working to lessen the severity of the proposal.
- Also, this week, NFIB will continue to work for resurrecting Assembly Bill 1035 by building on talks with the authors and Newsom-administration officials about offering small-business owners some liability protection since it seems Congress will not. Democratic Assemblyman James Ramos and State Director John Kabateck jointly penned an editorial on the issue.
- You deserve it. Never mind it hasn’t been since puberty when you were last paid a minimum wage. Come Jan. 1, 2021, according to Gov. Gavin Newsom, “Californians will get the raise they deserve” to $13 an hour for businesses with fewer than 25 employees and to $14 an hour for larger employers.
- Actually, the raises had been scheduled and already on the books to take effect, but some groups, including NFIB, had suggested to the governor that he might use his authority to suspend the raise until such a time when there are jobs for everyone to come back to or apply for. After 77 years of existence, NFIB still can’t shake itself of the silly notion that costs play an outsized role in determining economic vitality. On July 29, the governor gave his answer: No dice.
- “The governor is dead wrong on this call,” said State Director John Kabateck for an Associated Press story transmitted across the nation. He called the governor’s decision “a death blow” for many mom-and-pop businesses already struggling to keep their doors open. Click here to read NFIB’s news release on the governor’s decision.
- So, maybe the pandemic is not as bad as the media are making it out to be. Senate Bill 3 from 2016, which created the phased-in increases in the minimum wage also provided the governor the ability to postpone by a year any of the annual increases in the event of a major economic recession or state budget crisis. How much worse than the COVID-19 crisis would it have to get for the governor consider suspension?
- A top state income tax rate of 16.8 percent?
Assembly Bill 1253 was gutted and amended last week to impose three new tax rates on small businesses and wealthy Californians. On top of the existing state tax structure, AB 1253 provides the following:
- 1% tax on income above $1 million, but not over $2 million
- 3% tax on income over $2 million, but not over $5 million
- 3.5% tax on income over $5 million
These thresholds would be recomputed for each tax year beginning on or after January 1, 2021 based upon the California CPI. Under existing law, the highest base rate for individuals, or businesses taxed under the personal income law (e.g., LLCs, Subchapter S corporations), is 9.3%. There is also the ‘millionaire’s tax’ of an additional 1% for income in excess of $1 million.
If AB 1253 were enacted, the 13.3% rate would rise to 14.3% for incomes above $1 million and the state’s highest rate would be raised to 16.8% for incomes above $5 million. California already has the highest tax rate in the nation of 13.3 percent.
The bill requires a 2/3rds vote. It may never get a hearing.
- Meet Darrell Feil. NFIB California’s leadership council chairman is the first have a brief story written about him for the NFIB California webpage. Long-time NFIB member Alzada Knickerbocker has agreed to pen a series of vignettes on NFIB members that will help raise greater media and public awareness about the small-business agenda. Meet Darrell here.
- Have you registered for the NFIB Fly-In yet? You can do so right here. This NFIB signature event will be held virtually this year, August 17-19. Check out the three-day agenda here.
NFIB California Main Street Minutes are published every Monday on the NFIB California webpage. Two additional updates are published the first and third Thursday of each month for inclusion in the bi-monthly newsletters to the membership. Next California Main Street Minute is August 10.