Increased personal property tax exemptions, small-business grant program highlight accomplishments for Main Street enterprises
State Director Candace Daly reports from Salt Lake City on the small-business agenda at the end of the 2021 regular session of the Utah Legislature.
Utah’s 2021 legislative session started January 26 and ended March 5. By the end of it, NFIB Utah walked away with some important victories it lobbied hard for while stopping harmful legislation at the same time. The following are the bills of most importance to small business. A brief summary of the state budget follows them.
NFIB Utah was instrumental on winning passage of seven bills helpful for small-business growth and peace of mind.
Won Increased Exemptions in the Business Personal Property Tax
Senate Bill 18S05 exempts taxable tangible personal property is if the property has a total aggregate taxable value per county of $25,000. Items purchased are also exempt if the item is owned by a business and is not critical to the actual business operation of the business and the acquisition cost of the item is less than $500. If the taxpayer qualifies for the exemption for five consecutive years and files a signed statement for each of those years, a county assessor may not require the taxpayer to file a signed statement for each continuing consecutive year for which the taxpayer qualifies for the exemption. This change took approximately 35,000 to 40,000 more small businesses off the tax rolls for tangible personal property in the state of Utah.
Secured Grant Program for Small Businesses
Senate Bill 202SO1 originally created a grant program of $30,000 to help small businesses that were still struggling because of Covid-19. In the end, the Legislature decided to just add $20,000 to the GoUtah budget and earmark it for grant money and relief for small businesses. The money will be given out based on businesses with the most need.
Supported Regulatory Sandbox Program
House Bill 217S01 starts a new office that is part of GoUtah and creates a sandbox program that will allow companies to come into the sandbox and be relieved of regulations by the board that would stifle that business in its startup phase. This will also allow the state to have data that will show which regulations are not needed or are stifling business. Then the state can do away with those regulations.
Obtained Property Tax Valuation Amendments
House Bill 270S01 will give relief to property owners if they have appealed the value notice with the county and it was found in their favor, it will take one of the following to trigger an increase:
- an addition to your property of more than 20,000
- a change of zoning
- a change in the legal description of the real property.
Clarified Property Tax Records
House Bill 221 clarifies what should be private in a public property tax record. Tax relief documents are being clarified as private in addition to email addresses, phone numbers, and personal financial information related to a person’s payment method.
Supported Corporate Tax Unadjusted Income Amendments
HB 39S01 clarified the definition of special deductions for dividends received when it relates to federal taxable income and unadjusted taxes. This stops the taxing of special deductions for dividends as has always been the intent of the Legislature.
Won Data Security Protection
House Bill 80 creates an affirmative defense if the business is doing everything that a company can to protect data they have from customers. This will make everyone’s data more secure.
NFIB helped kill the following proposals in committee.
Defeated Minimum Wage Amendments, House Bill 284
Would have increased the minimum wage to $12 an hour, starting July 1, 2021, to $15 on July 1, 2025, and increased the cash wage for a tipped employee to $5 per hour. It also would have clarified that a minor means an individual who is 16 years old or younger.
Killed Minimum Wage Modifications, House Bill 361
Would have increased the minimum wage based on urban and nonurban counties within the state with an annual inflation adjustment.
Beat Back Parental Leave Amendments, House Bill 351
This bill was the camel’s nose under the tent. Creating a requirement for executive branch agencies and departments to provide an eligible employee parental leave upon the birth or adoption of the employee’s child. The fiscal note on this bill was so high it stopped the bill. That shows that if this were placed on businesses the cost would be stifling.
Workforce Solutions for Air Quality Amendments, SB 15501
For air quality purposes, this bill requires state agencies to determine if employees might be able to keep working from home. This has not really created a huge burden for businesses who are trying to work with agencies to accomplish things their businesses need but in certain circumstances, it has lengthened the time it takes to accomplish the task.
For Members’ Information
Vehicle Registration Renewal Notice Passes
If you drove your vehicles for months last year without thinking about renewing the license, you were not the only one. The State Tax Commission thought they would be able to save money by not sending the registration renewal cards to citizens in the state. They were in error, not only did the citizens not realize that they were driving vehicles with expired registrations the state lost out on way more revenue than the state saved by not sending the cards. Senior citizens were the group with the highest number of complaints to their legislators. Under House Bill 170, you will be able to opt in to an email notice. NFIB is looking out for your business vehicles.
Vehicle, Boat, and Trailer Registration Amendments Pass
HB 195S03 requires certain agencies to establish procedures for an individual to request automatic renewal of registration on a vehicle or boat. Allows special permanent registration decals for certain rental or fleet vehicles.
Undone, But Not Forgotten
One of the issues not addressed by the Utah Legislature this year was the forgiveness of taxes on a PPP loan.
NFIB Utah is not finished pushing for this to get over the finish line. Only 30% of Utah business received PPP loans, many which did not receive them applied and received an SBA Coronavirus Small Business Relief Loan.
The thought by the Legislature is that those who received the PPP loans have a huge advantage over those who had to go the SBA loan route. They want to make sure all businesses of equal type and income are treated the same.
NFIB Utah is pushing for the Legislature to use the new money that will be coming from the federal government to not only relieve those who were successful in acquiring a PPP loan but also to those who went the SBA Coronavirus route. Thus, still treating all businesses in the same manner.
NFIB Utah is not finished with this issue. We are working with the Salt Lake Chamber and the Rural Chambers to convince our legislative leadership to use some of the new money coming to Utah from the recently passed legislation to relieve small businesses who took PPP loans and also those who had to go the route of the SBA loans.
State Budget Highlights
The $23.5 billion budget for fiscal year 2022 included $10 billion in spending from the General and Education funds and nearly $7 billion from federal funds. Other budget items to highlight include:
- Nearly $100 million in tax cuts for dependent children, Social Security income, and military retirement.
- Education was funded for many items like, growth and inflation, increase in per pupil funding of 6%, teacher stipends, public education economic stabilization, 9% increase for higher education and funding for buildings and land purchases.
- $1.1 billion for roads and transit
- $36.5 million for two new state parks
- $110 million to renovate existing state parks
- $56 million for wildfire suppression
- 3% raises for state and higher education employees
- Increases for front-line workers in Social services, public safety and corrections
- Fully funded Medicaid
- $26 million in new ongoing funding to enhance mental health services
- $50 million in tax proceeds to secure a total of $730 million in combined public-private funding for housing and homelessness and
- $250 million to address the pandemic, including economic development assistance, rural broadband expansion, testing, and vaccine distribution.
This was just the beginning of getting money and funding to every corner of the state. Funding and money going to Business, Economic Development, and labor included many of the following. This is not all inclusive:
- Funding for DABC so they can raise the wages paid to state employees–some are making less than $10 per hour. They are having a hard time retaining their employees.
- $27.5 million in targeted grants for COVID-affected organizations:
- $20.0 million one-time for Live Event Economic Development grants
- $5.0 million one-time in grants for cultural nonprofits and for-profit organizations
- $2.5 million one-time for the Small Business Quarantine Grant Program
- $10 million one-time for Rural Fiber/Broadband/Wifi
- $9.0 million one-time for Outdoor Infrastructure Improvements