Auburn Area Chamber of Commerce

Apr 06, 2021 - Business

New UI Relief Bills Seek to Help Businesses Hurt By the Pandemic

HB 1568 and SB 5478 -- Unemployment insurance relief -- both introduced just this week, would provide as much as $600 million in targeted unemployment insurance tax relief to employers in certain industries that have been hardest hit by shutdowns and slowdowns ordered in response to the COVID-19 pandemic. Employers in those sectors whose unemployment insurance taxes jumped at least two rate classes could see their experience-rated charges removed from their account. The Senate version, approved by the Senate Ways & Means Committee provides this relief to qualifying firms with up to limits the relief to certain types of businesses using NAICS codes who moved more than 2 rate classes. There is a second tier for employer up to 40,000 employees who moved up more than 6 UI rate classes. The House bill would provide up to $350 million to qualifying firms with up to 20 employees, plus another $250 million designated for qualifying small businesses with fewer than 500 employees. It also includes many more impacted industries than the Senate version. Both versions are flawed at this point in time. The business community is working to make sure that the relief goes to the businesses who were hit the hardest by the pandemic.

Budgets are Moving

Both the House and Senate have released budgets and the Senate has passed their version of all three (operating, transportation and capital) over to the House of Representatives. The House is now working Friday and Saturday to get their versions off the floor and over to the Senate. At that point, there will be conference committees called and legislators will begin the process of making sure the three budgets match.

Operating Budget is Huge!

The Senate budget would spend $59.2 Billion while the House budget came in a bit lower at $58 billion. Still, both spend far more than the most recent state budget, which came in at $52.4 just two years ago.

The Senate budget increases spending by 12.4% over the last budget. Including federal relief funds, the 2019-21 spending budget would increase by 33% over the budget approved for 2017-19. The House budget increase is 11.5% over the proposed 2019-21 revision.

As with all budgets, there are some good things and bad things in it. However, both the House and Senate operating budgets assume passage of the Capital Gains tax at 7% on earnings over $250,000 or more. Both budgets then use the money from the Capital Gains tax (about $500 million) to fund child care and early learning.

Transportation Update

Both the House and Senate are moving toward reconciliation on a transportation budget to keep with current projects and requirements. This is difficult because the transportation budget saw an actal reduction in revenue (unlike the operating budget) due to reductions in gas taxes during the pandemic. But the goal is to keep moving forward on current projects, including projects agreed to as part of the 2015 Connecting Washington Package.

Also this week, House Transportation Chair Jake Fey released a NEW project transportation budget that relies on increased gas taxes and money from SB 5126, the climate commitment/cap and trade bill. The tying of a new transportation package with the cap and trade proposal that would cap greenhouse gas emissions and require emitters to buy "allowances from the state," is being referred to as "The Grand Bargain." Senate Hobbs is going to release his new project package next week. Whether or not the votes are there to pass both SB 5126 and the new transportation package with significant fuel tax increases is yet to be seen.

Other Bill Updates

ESHB 1097 - Worker Protection: Currently this bill is on the Senate floor awaiting a vote. This bill establishes a statutory means for the Department of Labor & Industries to issue an Order of Immediate Restraint or OIR for violations of safety and health laws or rules. It establishes unreasonably fast timelines (15 days) for employers to respond while giving employees 90 days to file complaints. There is a safety grant program in the bill to help employers with 25 or fewer employees purchase PPE or other upgrades needed for COVID protection -- but the money for these grants are taken out of workers' compensation funds intended to pay worker benefits. We are working on amendments to reduce the impact of this bill.

E2SHB 1076 - "Qui Tam": This bill that authorizes a "relator" to file actions against employers for supposed violations of wage and employment laws was scheduled to be voted on in the Senate Ways and Means Committee, but was pulled from the agenda. It may not be totally dead, but this was a good indication that there aren't enough votes for the bill.

E2SHB 1091 - Low Carbon Fuel Standard: The Senate Ways and Means Committee voted House Bill 1091 out of committee yesterday and it is now moving to the Senate floor for a vote. The bill would require fuel companiese to reduce the carbon in their fule by 10% by 2028 and by 20% by 2035. Refineries can either reduce the carbon content of their fuel or buy credits, which would subsidize electrification of transportation. The Puget Sound Clean Air Agency estimates its LCFS could raise the price of gasoline by as much as 57 cents per gallon, and the price of diesel up to 63 cents per gallon. Concerns about the cost of fuel, in addition to negative impacts on transportation funding, have business groups opposing the bill. Ways & Means did approve an amendment by Sen. Mark Mullet Wege that ties the carbon-reduction requirements to in-state biofuel production was also added. The Mullet amendment should allow further legislative review of fuel cost-increases and program effectiveness before the Department of Ecology can increase program targets.

High Priority Bills

Bill Details		Status	Sponsor	Position

E2SHB 1015	Equitable access to credit	S Rules 2	Maycumber	Support
	Creating the Washington equitable access to credit act. Establishes the Equitable Access to Credit Program (Program) within the Department of Commerce (Commerce). â¢ Authorizes Commerce to award grants to qualified lending institutions for lending or investing in historically underserved communities. â¢ Creates a credit against business and occupation taxes owed for contributions made to the Program.

2SHB 1033	Employment training program	S Rules 2	Leavitt	Support
	Concerning the Washington customized employment training program. Extends the expiration date for the Washington Customized Employment Training Program business and occupation tax credit to July 1, 2026. â¢ Requires the State Board for Community and Technical Colleges to report certain data from the Washington Customized Employment Training Program to the Legislature.

E2SHB 1073	Paid leave coverage	S Rules 2	Berry	Neutral
	Expanding coverage of the paid family and medical leave program. Provides temporary, alternate eligibility for Paid Family and Medical Leave claims through June 30, 2022. This bill has been amended so business community is neutral now.

2SHB 1076	Workplace violations/qui tam	S Ways & Means	Hansen	Oppose
	Allowing whistleblowers to bring actions on behalf of the state for violations of workplace protections. Authorizes a qui tam action for enforcement of various employment laws under which a relator on behalf of an agency may pursue relief. â¢ Specifies the distribution of any penalties or damages awarded. Qui Tam technically died in Committee on Friday but since the House budget references it, we are worried that it may come back to life. It is a high priority OPPOSE for the business community because allowing these actions where a relator can bring suit on behalf of another person against an employer actually leads to increases in frivolous lawsuits.

E3SHB 1091 (SB 5231)	Transportation fuel/carbon	S Rules 2	Fitzgibbon	Oppose
	Reducing greenhouse gas emissions by reducing the carbon intensity of transportation fuel. Directs the Department of Ecology (Ecology) to adopt rules establishing a Clean Fuels Program (CFP) to limit the aggregate, overall greenhouse gas (GHG) emissions per unit of transportation fuel energy to 10 percent below 2017 levels by 2028, and 20 percent below 2017 levels by 2035. â¢ Directs Ecology to update, prior to 2032, CFP rules to further reduce GHG emissions from each unit of transportation fuel for each year through 2050, consistent with statutory state emission reduction limits. â¢ Excludes exported fuel, fuel used by vessels, railroad locomotives, and aircraft, and certain other categories of transportation fuel from the CFP's GHG emission intensity reduction requirements. â¢ Requires the CFP to include processes for registering, reporting, and tracking compliance obligations and to establish bankable, tradeable credits used to satisfy compliance obligations. â¢ Retains the current distribution of revenue under the 2015 Transportation Revenue Package, eliminating changes that would have been triggered as a result of the establishment of a CFP. Requires the Washington State University Energy Program to initiate a program to identify least-conflict priority sites for low-carbon transportation fuel projects, and requires Ecology to periodically convene specified stakeholders to discuss mitigation of significant likely environmental impacts associated with low-carbon transportation fuel projects.

ESHB 1097 (SB 5090)	Worker protections	S 2nd Reading	Sells	Oppose
	Increasing worker protections. Establishes statutory procedures for an employer to contest an order of immediate restraint (OIR) and appeal alleged violations of the OIR, and authorizes the imposition of civil penalties for violations of an OIR. â¢ Makes changes to the Washington Industrial Safety and Health Act's anti-retaliation provisions, including prohibiting acts that would deter a reasonable employee from exercising their rights, expanding the time for filing a complaint, and authorizing civil penalties. â¢ Creates a grant program to assist small businesses in equipment purchases or capital costs during a state of emergency proclamation.

E2SHB 1099	Comprehensive planning	S Transportation	Duerr	Oppose
	Improving the state's climate response through updates to the state's comprehensive planning framework. Adds a goal of climate change mitigation to the listed goals of the Growth Management Act (GMA). â¢ Adds a climate change and resiliency element to the list of elements that must be included within the comprehensive plans that certain counties and cities must adopt under the GMA. â¢ Requires the Department of Commerce (Commerce), in consultation with other state agencies, to publish guidelines that specify a set of actions counties and cities have available to them to take related to greenhouse gas (GHG) emissions reductions and vehicle miles traveled (VMT) reductions. Requires the climate change and resiliency element of the comprehensive plan of certain counties and cities to identify actions the jurisdiction will take, consistent with guidelines adopted by Commerce, to reduce GHG emissions and VMT. â¢ Requires the climate change and resiliency element of the comprehensive plan of certain counties and cities to address the adverse impacts of climate change on people, property, and ecological systems. â¢ Specifies the process by which the GHG emissions reduction subelement of the climate change and resiliency element takes effect. â¢ Requires Commerce to adopt guidance that creates a model climate change and resiliency element. â¢ Requires the Department of Ecology to update its Shoreline Master Program guidelines to require Shoreline Master Programs to address the impact of sea level rise and increased storm severity. â¢ Adds consideration of climate change impacts to the list of elements that must be contained in optional comprehensive flood control management plans. â¢ Makes other changes. This bill died on Friday in Senate Transportation but may be brought back as part of budget negotiations.

ESHB 1189 (2SSB 5211)	Tax increment financing	S Passed 3rd	Duerr	Support
	Authorizing tax increment financing for local governments. Authorizes local governments to designate tax increment financing areas and to use increased local property tax collections to fund public improvements.

E2SHB 1220	Emergency shelters & housing	S Rules 2	Peterson	Concerns
	Supporting emergency shelters and housing through local planning and development regulations. Updates the housing goals of the Growth Management Act to include planning for and accommodating affordable housing. â¢ Requires jurisdictions to address moderate, low, very low, and extremely low-income housing in the housing element of the comprehensive plan. â¢ Requires jurisdictions to address racially disparate impacts and displacement in the housing element of the comprehensive plan. â¢ Requires the Department of Commerce to provide the inventory and analysis of existing and projected housing needs required in the housing element of the comprehensive plan. Amendments to this bill have somewhat addressed the city preemptions that were concerning.

ESHB 1232	GMA/affordable housing plans	S Rules 2	Barkis	Support
	Planning for affordable housing under the growth management act. Requires cities and counties planning under the Growth Management Act (GMA) to plan for single-family residences such as detached dwellings, duplexes, triplexes, and townhomes within urban growth areas (UGAs) in the housing element of the comprehensive plan. â¢ Requires cities and counties that do not plan for each specified housing type, including single-family residences such as detached dwellings, duplexes, triplexes, and townhomes within the UGA, to provide how the county and the cities within the county will meet existing and projected housing needs. â¢ Exempts counties and cities not subject to the buildable lands program from certain GMA requirements related to planning and consideration of duplexes, triplexes, and townhomes within the UGA if the county or city adopts certain findings related to lack of infrastructure support. â¢ Requires countywide planning policies to be updated before the deadline to update a comprehensive plan.

SHB 1279	Main street program	S Rules 2	Rule	Support
	Modifying the Washington main street program tax incentive to respond to the economic impacts of the COVID-19 pandemic. Expands the total business and occupation (B&O) tax or public utility tax (PUT) credit allowed under the Main Street Tax Incentive program to 90 percent, for contributions made to a designated local program or the state Main Street Trust Fund beginning in calendar year 2021. â¢ Expands the total tax credits allowed statewide to $5 million and for each designated local program to $160,000 for the Main Street Tax Incentive program. â¢ Specifies that the Department of Revenue must allocate tax credits under the Main Street Tax Incentive program between 8:00 a.m. on the second Monday in January and 8:00 a.m. on April 1 of the same year. â¢ Expands the total B&O tax or PUT credit allowed under the Main Street Tax Incentive program to 90 percent, for contributions made to a designated local program in calendar year 2020. â¢ Allows any tax credits earned under the Main Street Tax Incentive program as a result of contributions made in calendar year 2020 to be carried over until December 31, 2023. Removes any program, taxpayer, or statewide limits on the amount of tax credits provided under the Main Street Tax Incentive program for credits earned as a result of contributions made in calendar year 2020. â¢ Extends the expiration of the Main Street Tax Incentive program until January 1, 2032.

ESHB 1521 (SB 5446)	Warehousing & manuf. jobs	S 2nd Reading	Entenman	Support
	Supporting warehousing and manufacturing job centers. Creates the Manufacturing and Warehousing Job Centers Account. Provides for mitigation payments for the support of manufacturing and job centers in manufacturing and warehousing qualified local taxing districts negatively impacted by the Streamlined Sales and Use Tax Agreement.

HB 1568	Unemployment insurance	H Approps	Bergquist	Oppose
	Concerning unemployment insurance relief for small businesses.

ESSB 5024	Condominium construction	H Rules R	Padden	Support
	Reducing barriers to condominium construction. Exempts condominiums with ten or fewer units and no more than two stories from the requirement to submit building enclosure design documents and obtain periodic inspections throughout the course of construction. â¢ Allows deposit funds for the purchase of a unit in a common interest community to be used for construction costs if the declarant maintains a surety bond in favor of the purchaser in the amount of the deposit.

SSB 5025	Consumer protection act	H 2nd Reading	Rolfes	Concerns
	Concerning the consumer protection improvement act. Increases maximum civil penalties for a violation of the Consumer Protection Act. â¢ Establishes an enhanced civil penalty for unlawful acts or practices targeting specific individuals or communities based on demographic characteristics. â¢ Provides civil penalty actions are exempt from limitations restricting the time in which the action must be brought by the State.

ESSB 5097	Paid leave coverage	H Rules R	Robinson	Neutral
	Expanding coverage of the paid family and medical leave program. Expands the definition of family member in the Paid Family and Medical Leave (PFML) program. â¢ Requires the Employment Security Department to collect and analyze data and submit reports to the Legislature with certain information relating to the PFML program. â¢ Requires the general fund to cover additional leave expenses under certain circumstances. Amendments to this bill have been agreed to by the business community so effectively business is neutral now.

ESB 5232	Toll revenue bonding	H Transportation	King	Oppose
	Limiting bonding toll revenues on certain state highway facilities. Prohibits tolling revenue bonds from being sold for the Interstate 405/State Route 167 Express Toll Lanes and the Puget Sound Gateway facilities until January 1, 2023, and until the facilities' revenue outlooks meet certain benchmarks. Still opposed but amendment in the Senate made the bill more palatable. Hoping the bill will die in the House committee.

SSB 5262 (HB 1459)	Data center tax incentive	S 2nd Reading	Liias	Support
	Broadening the eligibility requirements and extending the expiration date for the data center tax incentive. Expands eligibility and extends the expiration date for the current sales and use tax exemption on qualifying businesses and tenants of eligible data centers.

SB 5312	Transit-oriented development	H Rules R	Mullet	Support
	Facilitating transit-oriented development and increasing housing inventory. Authorizes the use of appropriations to the Growth Management Planning and Environmental Review Fund to fund grants to cities to pay for certain planning-related costs related to transit-oriented development, including subarea plans and environmental impact statements. â¢ Requires the Department of Commerce to prioritize applications for grants to facilitate transit-oriented development to maximize certain specified objectives in the area covered by the grant proposal.

ESSB 5355 (HB 1369)	Wage liens	H 2nd Reading	Conway	Oppose
	Establishing wage liens. Creates a statutory wage lien for claims on unpaid wages. Creates procedures for establishing, foreclosing, extinguishing, and prioritizing wage liens.

Medium Priority Bills

Bill Details		Status	Sponsor	Position

SHB 1137 (SB 5465)	Road maintenance/planning	S 2nd Reading	McCaslin	Support
	Elevating road maintenance and preservation in transportation planning. READ FULL BILL SUMMARY/REPORT HERE - http://lawfilesext.leg.wa.gov/biennium/2021-22/Pdf/Bill%20Reports/House/1137%20HBA%20TR%2021.pdf?q=20210122142917

SHB 1170	Manufacturing	S Rules 2	Boehnke	Support
	Building economic strength through manufacturing. READ FULL BILL SUMMARY/REPORT HERE - http://lawfilesext.leg.wa.gov/biennium/2021-22/Pdf/Bill%20Reports/House/1170%20HBR%20CED%2021.pdf?q=20210218171741

SB 5046	Worker comp claim agreements	H Passed 3rd	Conway	Support
	Concerning workers' compensation claim resolution settlement agreements. Allows lump sum settlements in the state's workers comp system to be paid in conjunction with social security payments. This is a fix that is supported by both business and labor. READ FULL BILL SUMMARY/REPORT HERE - http://lawfilesext.leg.wa.gov/biennium/2021-22/Pdf/Bill%20Reports/Senate/5046%20SBR%20APS%2021.pdf?q=20210218170012

E2SSB 5194 (HB 1318)	Higher ed. equity & access	H Rules R	Liias	Support
	Providing for equity and access in the community and technical colleges. READ FULL BILL SUMMARY/REPORT HERE - http://lawfilesext.leg.wa.gov/biennium/2021-22/Pdf/Bill%20Reports/Senate/5194%20SBA%20WM%2021.pdf?q=20210218164706

SJR 8207	Revenue for highway purposes	S Transportation	Fortunato	Support
	Amending the state Constitution so that state revenue collected from a road usage charge, vehicle miles traveled fee, or other similar type of comparable charge, must be used exclusively for highway purposes.

SJR 8208	Car purchase taxes	S Ways & Means	Fortunato	Support
	Amending the state Constitution so that certain sales and use tax revenue collected from new and used car purchases are used for highway purposes.