NFIB California Main Street Minute

Date: August 30, 2021

For the legislative and political week August 30-September 3

Welcome to the August 30-September 3 edition of the NFIB California Main Street Minute from your NFIB small-business-advocacy team in Sacramento.

Vaccine Mandates

  • NFIB is engaged in end-of-session efforts to impose vaccine and testing mandates. Two bills are being discussed: Assembly Bill 455 and Assembly Bill 1102.

    • AB 455, the more expansive measure of the two, has seen many changes from when first released in draft form earlier this week. The primary provisions are an employer mandate to vaccinate all workers. Those that refuse will be required to be tested. The cost of testing would be the responsibility of the employers’ health insurance carrier. There could be a requirement of an additional three days leave for employees to be vaccinated.

    • AB 1102 is permissive to employers to require employees to be vaccinated. A leave requirement could be added to this bill as well. Details are changing hourly. Be assured NFIB is engaged and advocating for small employers on this issue. We will keep you updated as details become clear.

Blacklisting Businesses

  • Among the many new mandates that last year’s passage of Assembly Bill 685 heaped on state agencies was a requirement that “the State Department of Public Health … make specified information on outbreaks publicly available on its internet website, as specified. The bill would require local public health departments and the division to provide a link to this page on its internet websites.”

  • In a change lobbied for by NFIB California, Assembly Bill 654, a so-called ‘clean-up bill,’ if passed, “would require that workplace information reported regarding active COVID-19 outbreaks, as specified, be removed from the State Department of Public Health’s internet website after 14 days if no new cases of COVID-19 have been reported for that specific workplace.”

  • As of this report, NFIB’s chief legislative advocate, Kevin Pedrotti, is lining up some other business association support to “go neutral” on AB 654 if the above change is made. The Chamber is on board.

A Beautiful Sunset Businesses Badly Want to See

  • “Employers cannot continue to subsidize the state’s response to this virus.”

  • So said a business coalition letter that NFIB California and 82 other associations sent to members of the State Legislature asking them not to extend Senate Bill 95 past its September 30 sunset date.

  • Signed into law this year and retroactive to the beginning of 2021, SB 95, among other things, mandated the addition of up to 80 hours of employer-paid COVID-19 sick leave.

  • “The situation has changed significantly since SB 95 was enacted in March,” said the letter. “Far fewer Californians were vaccinated, and many Californians had not yet had the opportunity to get vaccinated. Now, vaccines are free and widely available.”

  • Stayed tuned. The Legislature adjourns September 10, so we’ll know shortly what was done or not done on SB 95.

The Big Day Has Come and Gone

  • Speaking of adjournment, last Thursday (August 26) was the day the Assembly and Senate Appropriations Committees made a final judgment on the bills to pass, hold, or amend. Next Monday’s Main Street Minute will have an update on NFIB’s top priority bills.

Latest from Cal/OSHA on Masks

  • From a news release issued last Wednesday by the Department of Industrial Relations, “Cal/OSHA encourages employers and workers to follow the recent update from the California Department of Public Health (CDPH) recommending that all individuals wear face coverings while indoors regardless of vaccination status.”

Recall Election

  • Most of you have received your ballots for the 2021 California Recall Election. Regardless of one’s position concerning the recall, NFIB believes it’s your responsibility to vote. For complete information, visit the Secretary of State’s special webpage here.

Busy Beginning of September

  • September 2—NFIB’s latest monthly Jobs Report released
  • September 4—the extra $300 a week the feds have been adding to state unemployment benefits ends.
  • September 6—interest clock on the money California borrowed from the federal government to keep its unemployment trust fund solvent starts ticking at a 2.27% interest rate.
  • September 6—Labor Day
  • September 9—State opens a new round in its Small Business COVID-19 Relief Grant Program, which will run until September 30.
  • September 10—Legislature adjourns 2021 session
  • September 14—Release of NFIB latest Small Business Economic Trends report (the Optimism Index)
  • September 14—Recall election

Federally

  • Last Tuesday, August 24, the House of Representatives passed the budget resolution, an intermediate step that begins the budget reconciliation process.

  • That process begins the week of September 6, when House committees begin “marking up” reconciliation pieces of the budget. The House Ways and Means Committee is scheduled to start its lengthy mark-up process on September 9. The tax provisions are expected to be considered September 13-14. The House budget resolution instructs committees to report their marked-up policy by September 15, but this nonbinding deadline could slip.

  • Senate Committees have been given a deadline of September 15 to have their reconciliation text drafted with the intent of having their reconciliation bill on the floor the week of October 4.

  • The budget reconciliation process has a number of provisions NFIB is opposed to:

    • A cap on the Small Business Deduction (section 199A) for businesses with qualified business income over $400,000

    • A repeal of stepped-up basis, which would hit family-owned businesses and farms particularly hard

    • Increase top individual tax rate – 37% –> 39.6% ($452,700 single / $509,300 joint)

    • An Increase in the top capital gains rate from 23.8 to 43.4%

    • An Increase in the corporate rate from 21% to 28%.
  • Members can take action here against small business tax increases.

  • Did you know that in addition to its monthly Jobs and SBET reports, NFIB also publishes a quarterly report breaking its data down to four industry sectors: construction, manufacturing, retail, and services?

  • Here are four takeaways from the latest quarterly report:
    • Small business owners in the construction industry had the highest percentage of unfilled job openings among all industries at 61%

    • A net 41% of firms in the manufacturing sector plan to create new jobs in the next three months, 14 percentage points higher than the overall small business economy

    • Earnings trends in retail fell 11 points from the previous quarter to a net negative 9 percent. Retailers also are becoming less optimistic about future economic conditions

    • The net percentage of employers in the service sector expecting higher sales fell 11 points from April to a net negative 1 percent of owners.

Next Main Street Minute September 6.

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