Prevailing wage was the issue du jour in the Assembly Government Affairs Committee. While three bills were on the agenda, the committee barely got through two of them due to the large amount of people that signed in to testify.
I stepped forward in strong support of AB 298, a bill introduced by Heidi Gansert, who worked with Clara Andriola of the Associated Builders and Contractors. This bill would make much-needed and long-overdue reforms to the prevailing wage process.
For those of you who don’t know, any contractor who bids a public works project in this state that costs more than $100,000 must pay his workers “prevailing wage.” This is sometimes known as “Little Davis-Bacon,” after the federal law of the same name that came to pass in the 1930s.
The idea is to ensure that workers are paid a “fair” wage and one that represents the average wage in the area. The problem is that the way the system currently works, the formula favors collective bargaining agreements and taxpayers get left holding the bag.
The short version of the process is that the State Labor Commissioner sends out a survey to every licensed contractor in the state, who fills out the wages they pay in various trade categories on every project they worked on. The list also includes the location (county) that each job was performed in.
A few issues:
1. Very few companies actually fill out the survey. This makes the sample that much more unreliable. There is a specific sub-group of companies that are very good at returning these surveys: union contractors. Why? Because their collective bargaining agreement requires them to. I stated on the record today that is incumbent on this Chamber and the trade groups that we work to educate employers about how important it is to fill out this survey. It could mean more money in their pocket!
2. When filling out the survey, a contractor is required to list the work done on private AND public projects. This means that public project wages, which are inflated by the prevailing wage, are included in the final formula scheme. In other words, prevailing wages help determine the prevailing wage!
3. It is important to note that there is a large chunk of the prevailing wage rate that never gets into laborers pockets. Some of that wage gets funneled back to labor unions, which use that money for other things besides worker safety and welfare.
One of the beauties of AB 298 is that it would exempt K-12 and higher education construction projects from the prevailing wage requirements. During my testimony, I mentioned the Chamber’s strong support of the failed WCSD-1 failed school revitalization ballot campaign last year. I pointed out that we could build more schools and serve more children if we spent extra prevailing wage money on building school facilities.
Truth be told, the Chamber opposes any type of prevailing wage law (see page 7 of our Agenda for Economic Vitality in Nevada).
When asked by one Committee member if the Chamber supports eliminating prevailing wage completely or just reforming it, I replied: “Both.” AB 298 is a good first step.
Tuesday, March 31, 2009
Monday, March 30, 2009
The week is off to a fast start.
My morning began in the Assembly Government Affairs Committee, where “fire-safe” cigarettes were discussed. AB 229 would mandate that all cigarettes sold in Nevada be tested to ensure that they are easily extinguishable and protect people and property from fire. There was no opposition to the bill, as cigarette manufacturers helped craft it and the Retail Association proposed an amendment to ensure that their members (and the Chamber’s) are properly notified of those brands that have been approved.
The afternoon found me in Assembly Commerce and Labor, where I went to the table in opposition to two bills.
The first was AB 365, sponsored by Assemblywoman Sheila Leslie. This is yet another insurance mandate bill. This one in particular would require all small employer insurance policies to cover treatment for eating disorders. Again, while each of these bills may seem to have merit, and the proponents always argue that the cost is minimal, it is the added effects of all of these insurance mandates that really drive up health care costs.
Nevada is something like 3rd in the nation with the amount of health insurance mandates on small employers. We have over 50 mandates! Large businesses covered under ERISA plans have only 6 or so mandates to deal with.
When you add all of the workers comp bills to this, the dollars really start to add up.
The second bill which brought me to the table was AB 381. This bill would do away with binding arbitration in various consumer contracts, thereby driving cases into already overcrowded courtrooms. Arbitration can save both sides in a dispute a lot of money. Obviously, any company that has to deal with a new wave of attorney fees and court costs will pass on those costs to the consumers.
My morning began in the Assembly Government Affairs Committee, where “fire-safe” cigarettes were discussed. AB 229 would mandate that all cigarettes sold in Nevada be tested to ensure that they are easily extinguishable and protect people and property from fire. There was no opposition to the bill, as cigarette manufacturers helped craft it and the Retail Association proposed an amendment to ensure that their members (and the Chamber’s) are properly notified of those brands that have been approved.
The afternoon found me in Assembly Commerce and Labor, where I went to the table in opposition to two bills.
The first was AB 365, sponsored by Assemblywoman Sheila Leslie. This is yet another insurance mandate bill. This one in particular would require all small employer insurance policies to cover treatment for eating disorders. Again, while each of these bills may seem to have merit, and the proponents always argue that the cost is minimal, it is the added effects of all of these insurance mandates that really drive up health care costs.
Nevada is something like 3rd in the nation with the amount of health insurance mandates on small employers. We have over 50 mandates! Large businesses covered under ERISA plans have only 6 or so mandates to deal with.
When you add all of the workers comp bills to this, the dollars really start to add up.
The second bill which brought me to the table was AB 381. This bill would do away with binding arbitration in various consumer contracts, thereby driving cases into already overcrowded courtrooms. Arbitration can save both sides in a dispute a lot of money. Obviously, any company that has to deal with a new wave of attorney fees and court costs will pass on those costs to the consumers.
Thursday, March 26, 2009
Packed Hearing Room for SB 201
The Senate Taxation hearing room was packed today for SB 201, the RTC-5 implementation bill. There were so many construction workers and labor union folks that showed up that a second hearing room was opened downstairs for the overflow.
The lineup included Mayors Bob Cashell and Gino Martini, County Commissioner John Breternitz, Reno City Councilman Dave Aiazzi, Derek Morse with the RTC, Norm Dianda with Q&D Construction, and developer Perry DiLoretto. I sat at the table right next to Skip Daily with the Laborer’s union, which doesn’t occur that often!
I pointed out that while we talk a lot about this bill creating 3,000 jobs, we don’t talk about what those 3,000 jobs mean to the rest of our Chamber members. The workers on these projects will have money to spend on the goods and services that our members provide.
The improved roads will allow all of us to get to work, home, and school quickly and safely.
SB 201 is also an economic development tool. While this Chamber works hard every day to ensure that our state’s tax structure remains business-friendly, we also need to ensure that our transportation system is adequate for our present and future needs. Companies looking to re-locate or expand their presence here want to be able to move their goods and their employees around the region efficiently.
The trucking association testified as neutral and the petroleum marketing folks had some issues. There was one Washoe County resident who testified in opposition to the bill, but she seemed to have more issues with how the sample ballots were distributed than with anything else.
While there were a few technical questions from some of the committee members, the reception seemed pretty positive.
The committee took no action on the bill today, but it needs to be out of there and to the floor by April 10th.
We really want to get this bill through as fast as possible so that we can start bonding projects and get people to work as soon as possible.
The lineup included Mayors Bob Cashell and Gino Martini, County Commissioner John Breternitz, Reno City Councilman Dave Aiazzi, Derek Morse with the RTC, Norm Dianda with Q&D Construction, and developer Perry DiLoretto. I sat at the table right next to Skip Daily with the Laborer’s union, which doesn’t occur that often!
I pointed out that while we talk a lot about this bill creating 3,000 jobs, we don’t talk about what those 3,000 jobs mean to the rest of our Chamber members. The workers on these projects will have money to spend on the goods and services that our members provide.
The improved roads will allow all of us to get to work, home, and school quickly and safely.
SB 201 is also an economic development tool. While this Chamber works hard every day to ensure that our state’s tax structure remains business-friendly, we also need to ensure that our transportation system is adequate for our present and future needs. Companies looking to re-locate or expand their presence here want to be able to move their goods and their employees around the region efficiently.
The trucking association testified as neutral and the petroleum marketing folks had some issues. There was one Washoe County resident who testified in opposition to the bill, but she seemed to have more issues with how the sample ballots were distributed than with anything else.
While there were a few technical questions from some of the committee members, the reception seemed pretty positive.
The committee took no action on the bill today, but it needs to be out of there and to the floor by April 10th.
We really want to get this bill through as fast as possible so that we can start bonding projects and get people to work as soon as possible.
Wednesday, March 25, 2009
The Session has finally started...
It has been said that the Legislative session really started on Monday, which was the deadline for all the committees to introduce their bills. We finally know the lay of the land and the (somewhat) totality of what we have to deal with. While there is always the potential for leadership to introduce “emergency” bills, there is no way to quantify what those will be yet.
The next deadline is April 10th, when most bills must be through their first committee of introduction. This means that the next few weeks will be a flurry of activity.
I received a document the other day that has about 15 bills listed on it that could negatively impact the business community, 12 or so of those bills are workers comp related. There are some big deals in there and I will get more information out to Chamber members as I learn about them.
I took action on two bills today. The first was AB 313 in the Assembly Commerce and Labor Committee. As I had to testify in another hearing, I signed in as opposed but did not go to the table. As you can see from the link above, this bill would limit the amount of late fees that a landlord could charge a tenant if he/she is late with their rent payment. While this bill only affects a certain segment of our membership, the Chamber believes that this is an unnecessary intrusion into the private sector and that every business should be free to set their own payment policies and procedures.
I stepped up to the table in the Senate Government Affairs Committee to oppose SB 264. This bill would allow all local governments (counties, cities, school districts, library boards, etc) to impose, increase, decrease, or repeal certain taxes without having to come to the State Legislature for authority to do so.
Nevada does not have a home rule system whereby localities are free to set their own taxing and spending policies. All taxes imposed by a local government have to have been authorized at some point by the legislature. Of course, several local government representatives testified in support of this concept.
While the Chamber believes that there should be discussions about giving local governments more autonomy over their affairs, rules, and regulations, I testified that tax rates and policies should probably have the extra check and balance that the legislature provides. I quoted our Agenda for Economic Vitality in Nevada, which states our support for the “concept of reasonable tax and fee caps to prevent government from unnecessary expansion.”
I also pointed out that there could be unintended consequences if this bill were to become law. We all know that Clark County is the economic engine of this state. Could there be a scenario whereby that county raised taxes or fees so much that businesses have no incentive to remain or locate there? Would that reduction in tax base then ripple through our state budget and, therefore, our local budget? These are things that must be considered.
Tomorrow at 1:30 will find me in Senate Taxation testifying in strong support of SB 201, the RTC-5 bill. Come down to Carson and support us!
The next deadline is April 10th, when most bills must be through their first committee of introduction. This means that the next few weeks will be a flurry of activity.
I received a document the other day that has about 15 bills listed on it that could negatively impact the business community, 12 or so of those bills are workers comp related. There are some big deals in there and I will get more information out to Chamber members as I learn about them.
I took action on two bills today. The first was AB 313 in the Assembly Commerce and Labor Committee. As I had to testify in another hearing, I signed in as opposed but did not go to the table. As you can see from the link above, this bill would limit the amount of late fees that a landlord could charge a tenant if he/she is late with their rent payment. While this bill only affects a certain segment of our membership, the Chamber believes that this is an unnecessary intrusion into the private sector and that every business should be free to set their own payment policies and procedures.
I stepped up to the table in the Senate Government Affairs Committee to oppose SB 264. This bill would allow all local governments (counties, cities, school districts, library boards, etc) to impose, increase, decrease, or repeal certain taxes without having to come to the State Legislature for authority to do so.
Nevada does not have a home rule system whereby localities are free to set their own taxing and spending policies. All taxes imposed by a local government have to have been authorized at some point by the legislature. Of course, several local government representatives testified in support of this concept.
While the Chamber believes that there should be discussions about giving local governments more autonomy over their affairs, rules, and regulations, I testified that tax rates and policies should probably have the extra check and balance that the legislature provides. I quoted our Agenda for Economic Vitality in Nevada, which states our support for the “concept of reasonable tax and fee caps to prevent government from unnecessary expansion.”
I also pointed out that there could be unintended consequences if this bill were to become law. We all know that Clark County is the economic engine of this state. Could there be a scenario whereby that county raised taxes or fees so much that businesses have no incentive to remain or locate there? Would that reduction in tax base then ripple through our state budget and, therefore, our local budget? These are things that must be considered.
Tomorrow at 1:30 will find me in Senate Taxation testifying in strong support of SB 201, the RTC-5 bill. Come down to Carson and support us!
Monday, March 23, 2009
More insurance mandates...
Signed in as opposed to two more insurance mandate bills today.
Both the Senate and Assembly Commerce and Labor Committees meet at 1:30 in the afternoon, and both have jurisdiction over insurance mandate bills.
In the Assembly, AB 268 was up. This would require all businesses who aren’t self-insured to cover new chemotherapy treatments, including pills that can be taken orally. The argument was made by the proponents of the bill that a pill regimen could potentially be much cheaper than chemo treatment that involves a doctor visit, IV drip, etc. The insurance industry, however, argued that evidence in Colorado showed that the drugs were actually the much more expensive option.
Senate Commerce and Labor took up SB 192, which would require insurance policies to cover name-brand drugs, but only charge generic prices to its policyholders. Apparently, the patient would not even have the option of using generic drugs. As name-brand drugs are not cheap, someone will have to make up that cost. That someone would be every small business owner who pays for health care and prescription coverage for their employees.
The Chamber remains opposed to all new health insurance mandates, as they tend to drive up the cost of every insurance policy.
Both the Senate and Assembly Commerce and Labor Committees meet at 1:30 in the afternoon, and both have jurisdiction over insurance mandate bills.
In the Assembly, AB 268 was up. This would require all businesses who aren’t self-insured to cover new chemotherapy treatments, including pills that can be taken orally. The argument was made by the proponents of the bill that a pill regimen could potentially be much cheaper than chemo treatment that involves a doctor visit, IV drip, etc. The insurance industry, however, argued that evidence in Colorado showed that the drugs were actually the much more expensive option.
Senate Commerce and Labor took up SB 192, which would require insurance policies to cover name-brand drugs, but only charge generic prices to its policyholders. Apparently, the patient would not even have the option of using generic drugs. As name-brand drugs are not cheap, someone will have to make up that cost. That someone would be every small business owner who pays for health care and prescription coverage for their employees.
The Chamber remains opposed to all new health insurance mandates, as they tend to drive up the cost of every insurance policy.
Thursday, March 19, 2009
I sat in this morning’s Joint Ways and Means/Finance Committee meeting on the merger between the Nevada Commission on Economic Development and the Nevada Commission on Tourism. The Governor has proposed to merge the two agencies in an effort to balance the budget.
Most of the committee members expressed skepticism of the idea, acknowledging that each of the agencies have very different missions. Lt. Governor Brian Krolicki stepped up to the table to oppose the idea.
The afternoon was spent in Assembly Taxation, where I was pleased to testify in support of two bills.
The first, AB 146, is sponsored by Majority Leader John Oceguera, with strong support from Secretary of State Ross Miller. It would create an online “business portal” operated by Miller’s office that would allow any business in the state to go to one place to take care of all of their license, permit, and tax issues. One website would allow you to take care of all the various state and local agencies that a business must deal with when setting up shop or renewing their operation.
The Majority leader included the Chamber and other business organizations in a working group to work out any issues with the bill prior to the hearing. I cannot speak highly enough of this process, whereby a legislator brings forward an idea and actually puts together a group of stakeholders to work on it. Mr. Oceguera is well-known for doing this and he is to be commended for it.
The second bill that I testified in favor of is AB 275, which has been proposed by Minority Leader Heidi Gansert. This bill would ensure that banks and other financial institutions pay the same Modified Business Tax rate that every other business pays. It would also eliminate the discriminatory branch excise tax imposed on those same institutions.
Currently, most of the business community pays 0.63% of their payroll to the state. Banks, however, must cough up 2% of their payroll AND pay a $7000 per branch excise tax on any branch above one per county.
The Chamber believes that this is horrible tax policy. No industry should be singled-out for extra taxation and we are opposed to any tax per business branch location. No business should be punished for being successful and offering better service to their customers.
Given the general fund hole that the Legislature is staring at, I do not have high hopes for the passage of any bill that would actually decrease taxes. That doesn’t mean we should give up on our principles.
Most of the committee members expressed skepticism of the idea, acknowledging that each of the agencies have very different missions. Lt. Governor Brian Krolicki stepped up to the table to oppose the idea.
The afternoon was spent in Assembly Taxation, where I was pleased to testify in support of two bills.
The first, AB 146, is sponsored by Majority Leader John Oceguera, with strong support from Secretary of State Ross Miller. It would create an online “business portal” operated by Miller’s office that would allow any business in the state to go to one place to take care of all of their license, permit, and tax issues. One website would allow you to take care of all the various state and local agencies that a business must deal with when setting up shop or renewing their operation.
The Majority leader included the Chamber and other business organizations in a working group to work out any issues with the bill prior to the hearing. I cannot speak highly enough of this process, whereby a legislator brings forward an idea and actually puts together a group of stakeholders to work on it. Mr. Oceguera is well-known for doing this and he is to be commended for it.
The second bill that I testified in favor of is AB 275, which has been proposed by Minority Leader Heidi Gansert. This bill would ensure that banks and other financial institutions pay the same Modified Business Tax rate that every other business pays. It would also eliminate the discriminatory branch excise tax imposed on those same institutions.
Currently, most of the business community pays 0.63% of their payroll to the state. Banks, however, must cough up 2% of their payroll AND pay a $7000 per branch excise tax on any branch above one per county.
The Chamber believes that this is horrible tax policy. No industry should be singled-out for extra taxation and we are opposed to any tax per business branch location. No business should be punished for being successful and offering better service to their customers.
Given the general fund hole that the Legislature is staring at, I do not have high hopes for the passage of any bill that would actually decrease taxes. That doesn’t mean we should give up on our principles.
Wednesday, March 18, 2009
I am beginning to feel the affects of being the Chamber’s one-man show down in Carson.
I wanted to be in three different hearings at the same time this afternoon, so I signed in at one, testified in the other, and missed the third. If it weren’t for my intern Tony back at the office, I would be more confused than normal!
Senate Government Affairs heard SB 189 today, which would allow an employee to file a complaint in court without first going to the State Labor Commissioner. The labor unions seem to be upset with current Labor Commissioner Mike Tanchek, a great public servant. Maybe because he doesn’t give them everything they want. This is the same group that wants sole authority to pick the Labor Commissioner. I signed in as opposing this bill, but I was not able to attend the hearing.
I went before the Assembly Commerce and Labor Committee again today in opposition to AB 224, which would prohibit insurance companies from denying payments of amounts that are “not in dispute.” Representatives from the insurance industry testified that this language is ambiguous and consumers already have the right to sue insurers for denying payments and coverage. This bill also adds that an insurer is liable for any damages, “including, without limitation, costs and reasonable attorney’s fees.” I think we all know what can of worms that last phrase opens.
Tomorrow brings two bills that I will heartily support in Assembly Taxation: the creation of a statewide “business portal” website, and the repeal of the discriminatory modified business and branch taxes on banks.
I wanted to be in three different hearings at the same time this afternoon, so I signed in at one, testified in the other, and missed the third. If it weren’t for my intern Tony back at the office, I would be more confused than normal!
Senate Government Affairs heard SB 189 today, which would allow an employee to file a complaint in court without first going to the State Labor Commissioner. The labor unions seem to be upset with current Labor Commissioner Mike Tanchek, a great public servant. Maybe because he doesn’t give them everything they want. This is the same group that wants sole authority to pick the Labor Commissioner. I signed in as opposing this bill, but I was not able to attend the hearing.
I went before the Assembly Commerce and Labor Committee again today in opposition to AB 224, which would prohibit insurance companies from denying payments of amounts that are “not in dispute.” Representatives from the insurance industry testified that this language is ambiguous and consumers already have the right to sue insurers for denying payments and coverage. This bill also adds that an insurer is liable for any damages, “including, without limitation, costs and reasonable attorney’s fees.” I think we all know what can of worms that last phrase opens.
Tomorrow brings two bills that I will heartily support in Assembly Taxation: the creation of a statewide “business portal” website, and the repeal of the discriminatory modified business and branch taxes on banks.
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