An Update from the State House
Last week, the Senate Labor Committee, after taking testimony on a number of business-related bills, held those bills for further study. This simply means that the bills remain alive. S.373. allows employees who are covered by an employer sponsored disability insurance program to elect to be exempt from the state temporary disability insurance program. S.615 bars employers from refusing to hire, discharge, or “otherwise discriminate” against a person with respect to any terms, conditions, or privileges of employment, because of his or her status as a medical marijuana cardholder - including because of a positive drug test for marijuana at the workplace or during the hours of employment. S.835 makes it an unlawful employment practice for any person, whether or not an employer, employment agency, labor organization, or employee, “to directly or indirectly commit any act declared by this section to be an unlawful employment practice” (the quoted language would be new law). Additionally the legislation allows individual employees to be held liable for their actions with fellow employees.
This Week at the State House
As of last Sunday, the hearing schedule for the House and Senate was very light, which could mean that both sides are discussing which bills are on the favored and disfavored lists. To date only two hearings are noteworthy.
The House Finance Committee is meeting Tuesday at the Rise, approximately 4:30 p.m., to allow the fiscal staff to provide a budget status briefing. The briefing will take place in Room 35.
On the same day, Senate Finance will be meeting at the Rise in Room 211. S.134, An Act Relating to Taxation, would correct what some believe was an oversight a few years ago when income tax reform was adopted. Under current law, a non-resident seller of real estate must have 9% of the sales price held by the closing attorney until such time as the individual’s personal income tax is paid in April. That made sense when the highest tax bracket was 9%; but since it has been lowered to 7%, it makes sense to lower the non-resident withholding amount as well. S.669, An Act Relating to Taxation – Real Estate Conveyance, will also be heard in committee. It allows the City of Newport to institute a 2% real estate transfer tax on the buyer of property.
The following bill was filed last week:
House Bill No. 6117 Costantino, Hawkins, AN ACT RELATING TO LABOR AND LABOR RELATIONS - MINIMUM WAGES (Exempts full-time college students employed by the college or university they attend from the requirement of a three (3) hour work shift guarantee by the employer.)
An Update from the State House
Revenue Estimating Conference (REC) Finishes Work
The eight and a half hour meeting of the Department of Revenue staff, the Senate Fiscal Policy staff and the House Fiscal Policy staff showed just how dedicated these individuals are to making the best budget estimates possible. The bottom line: Rhode Island is expected to end the current fiscal year with $4,017,910,000 in state revenue which is up $24.8 million from the estimate made in November of 2018. While that is certainly good news, it is a narrow victory given the budget proposal put for by the Governor for FY2020 includes many new initiatives.
The REC estimates total general revenues for FY2020 to be $3,952,450,000 (not including the hospital licensing fee; so the total general revenue for FY2020 is relatively the same). So how does the Conference determine that number? The members go through every tax from personal income to business corporation tax, to inheritance and gift taxes, to gambling, realty transfers etc and discuss a rationale for each assumption. One of the longest debates came with the sales tax collection assumption. The Revenue Department (represents the Governor’s office) wanted to assume a 7% growth rate over the current fiscal year, while the Senate assumed 3.1% and the House assumed 3.9%. The Tax Division stated that the large increase was justified by an expected uptick in collections from the new software tax and security services tax. Of the 30,000 taxpayers believed to be subject to these new taxes, about a third have not filed the required tax reconciliation forms. The Division said this is not unusual as entities subject to new taxes often do not realize they should be paying the tax. The Division plans to send out a notice to all of those businesses that have not filed the reconciliation form and then follow up with audits. After much back and forth debate, the Conference settled on a 4.1% growth in sales tax, meaning the state expects to collect a total of $1,172,900,000 in sales and use tax next fiscal year.
The next longest debate centered around sports gambling. It was extremely difficult for all of the members to determine a comfortable estimate for this revenue given the current experience. The remote sports gambling technology is slated to be up and running September 1st. The REC decided to allow for two additional weeks of lag time before the start date in the event more time is need for testing of equipment or any delays in equipment arrival. Ultimately, the state is estimating to receive $22.7 million next year in sports betting. The total revenue estimated to be received from all gaming sources (casino, lottery, sports) is $412.8 million. This represents a $12.7 million increase over the current fiscal year.
Other revenues estimates for FY2020 include Business Corporation Tax of $164 million (down $500,000 from FY2019); Personal Income Tax of $1,426,800,000 (up $42.8 million over FY2019); Inheritance and Gift Tax of $38 million (down $10 million over FY2019) and Public Utilities Gross Receipt Tax of $103.2 million (up $300,000 over FY2019).
The FY2020 budget was projected to face a $100 million deficit. The expenses for the state did see a reduction over projected expenses since last November, so it is not clear yet just how much the revenue estimates will eat away at the projected deficit. The Finance Committees will now take this information and begin to re-shape the Governor’s proposed budget to address priorities of the House, Senate and Governor’s office. Difficult choices will have to be made. The FY2020 budget is expected to be released sometime in June.
This Week At the State House
If you have to be at the State House Tuesday, May 14th give yourself extra time. On Tuesday, the Senate Judiciary Committee will vote on S.152 SubA and H.5125 SubA. These are the bills referred to as the state codification of the Roe v. Wade decision (proponents and opponents disagree on how close the language is to Roe v Wade). The State House is expected to be very crowded that day, and the lines to go through building security will likely be long.
On Wednesday, May 15th, the Senate Education Committee will meet at the Rise (approximately 4:30 p.m.) in Room 313 to take testimony on the newly filed education reform package. The link to the bills – S.863, S.864, S.865, S.866, S.867, S.868 and S. 869 can be found below in the newly filed bills listing. The bills address a number of issues like the development of statewide academic standards and curriculum frameworks for the core subjects; providing school principals with more authority to handle personnel and budget matters; and establishing a system to evaluate schools. The House Health Education and Welfare Committee will take up the house bills dealing with education reform (H.6084, H.6085, H.6098, H.6099 and H.6100) the same day, same time in Room 101.
The Senate Labor Committee will be taking testimony on a number of business-related bills Wednesday, May 15th at the Rise in the Senate Lounge. One bill the Chamber supports is S.373. It allows employees who are covered by an employer sponsored disability insurance program to elect to be exempt from the state temporary disability insurance program. The employer is required to show documentation to the Department of Labor and Training to prove such coverage exists. S.615 bars employers from refusing to hire, discharge, or “otherwise discriminate” against a person with respect to any terms, conditions, or privileges of employment, because of his or her status as a medical marijuana cardholder - including because of a positive drug test for marijuana at the workplace or during the hours of employment. S.835 would make it an unlawful employment practice for any person, whether or not an employer, employment agency, labor organization, or employee, “to directly or indirectly commit any act declared by this section to be an unlawful employment practice” (the quoted language would be new law). Additionally the legislation allows individual employees to be held liable for their actions with fellow employees.
The following bill was filed last week:
House Bill No. 6084 Amore, Mattiello, Shekarchi, Edwards, Blazejewski, AN ACT RELATING TO EDUCATION -- EDUCATION ACCOUNTABILITY ACT (Provides for greater school-based management at the school level and expands the duties of school improvement teams and establishes a new chapter on education accountability.)
House Bill No. 6085 Barros, Ackerman, Bennett, Corvese, Shanley, AN ACT RELATING TO EDUCATION - CERTIFICATION OF TEACHERS (Allows teachers to obtain fast-track certification as a principal.)
House Bill No. 6086 Serodio, Hawkins, Amore, Noret, Shekarchi, AN ACT RELATING TO EDUCATION -- HEALTH AND SAFETY OF PUPILS (Increases the members of public school personnel to include all trained school administrators, teachers, or SROs among those authorized to administer an opioid antagonist where there is an emergency drug overdose in a school setting.)
House Bill No. 6087 Williams, Vella-Wilkinson, O'Brien, Caldwell, McKiernan, AN ACT RELATING TO LABOR AND LABOR RELATIONS -- HEALTHY WORKPLACE (Creates the "Healthy Workplace Act of 2019" and would establish a cause of action against employers and employees for workplace bullying, harassment and other abusive conduct.)
House Bill No. 6098 Alzate, Maldonado, Edwards, Speakman, Slater, AN ACT RELATING TO EDUCATION - CERTIFICATION OF TEACHERS (Directs the council on elementary and secondary education to implement teacher licensure tests modeled after the Massachusetts tests for educator licensure, commencing on July 1, 2021.)
House Bill No. 6099 Caldwell, Diaz, Noret, Morin, Knight, AN ACT RELATING TO EDUCATION -- CERTIFICATION OF TEACHERS (Directs the council on elementary and secondary education to implement a teacher assessment and evaluation system which emphasizes the alignment of instruction delivered to the state's standards.)
House Bill No. 6100 Mendez, Fellela, Jackson, Vella-Wilkinson, Hawkins, AN ACT RELATING TO EDUCATION -- CERTIFICATION OF TEACHERS (Creates a provisional educator certification to be issued by the board of education to teachers who meet qualifications set by the board and who shall be subject to supervisory conditions set by the board.)
Senate Bill No. 863 Gallo, Ruggerio, Goodwin, McCaffrey, Algiere, AN ACT RELATING TO EDUCATION - CURRICULUM (Requires the commissioner of education to develop statewide academic standards and curriculum frameworks for the core subjects of mathematics, English language arts, science and technology, history and social studies, world languages, and the arts.)
Senate Bill No. 864 Satchell, DiPalma, Pearson, Seveney, Paolino, AN ACT RELATING TO EDUCATION -- CURRICULUM (Direct the council on elementary and secondary education to provide professional support and assistance to LEAs regarding effective ways to use data such as the LEA’s budget and demographics, school culture, and assessments to improve student performance.)
Senate Bill No. 865 Pearson, McCaffrey, Algiere, Goodwin, Ruggerio, AN ACT RELATING TO EDUCATION -- THE RHODE ISLAND BOARD OF EDUCATION ACT (Expands the duties of principals over school personnel/facilities/budget/eliminates commissioner of post secondary education/authorizes board of education to adopt system evaluating public schools/local education agencies.)
Senate Bill No. 866 Sheehan, Quezada, Seveney, DiPalma, Felag, AN ACT RELATING TO EDUCATION - CERTIFICATION OF TEACHERS - TESTING REQUIREMENTS FOR NEW TEACHERS (Establishes testing requirements for initial certification of new teachers on or after July 1, 2021.)
Senate Bill No. 867 Paolino, Quezada, Pearson, DiPalma, Gallo, AN ACT RELATING TO EDUCATION -- CERTIFICATION OF TEACHERS (Establishes a procedure for the certification of provisional educators.)
Senate Bill No. 868 Seveney, DiPalma, Cano, Lombardi, Lynch Prata, AN ACT RELATING TO EDUCATION - TRAINING AND EVALUATION - NEW EVALUATION REQUIREMENTS (Directs council on elementary and secondary education to implement assessment and evaluation system. Also requires local education agencies (LEAs) to adopt the model assessment and evaluation system for use in their schools.)
Senate Bill No. 869 Metts, Goodwin, Gallo, Quezada, Pearson, AN ACT RELATING TO EDUCATION - TRAINING AND EVALUATION - FAST-TRACK PRINCIPAL CERTIFICATION PROGRAM (Allows teachers to obtain certification as a principal in an expedited period of time.)
Chairman, Mark DeVine participates in a Business Walk on May 7th in the East Bay to kick off Small Business Week, meeting with businesses who gave open and honest feedback. The hope is that this walk helped community leaders to better understand the needs of the business community, so they can make more informed decisions and provide resource and support to help business retention and growth. www.connectgreaternewport.com
Quick Overview of Last Week
Straws – The Senate Environment and Agriculture Committee held S.292 SubA for further study following a backlash from environmental groups over the inclusion of state preemption language in the amended version of the bill. Business groups requested preemption in order to avoid traps that come with the potential of 39 different rules.
Global Warming and Carbon Tax – These bills were held for further study by the committee. The Chamber provided oral testimony along with one other business group, siting the existing high cost of energy in the state and the fact the bill calls for a $15 per metric ton of carbon tax if two other states pass a $5 per metric ton tax. Many proponents testified during the 3 hour hearing noting the level of sea rise and storm changes, while one pleaded not to allow Earth to become the next Venus which she claimed is hot, not because it is closer to the sun but because the carbon on the planet is trapped in the atmosphere instead of the ground.
Non Compete Clause – Both the Senate and House versions were held for further study while amended language is worked on with input from various interest groups.
This Week at the State House
FY2020 Budget Update
This week will end with the final Revenue Estimating Conference meeting that takes place Friday, May 10th. The Governor, House Finance and Senate Finance committees will come to an agreement on revenues available for the FY2020 budget. As has been stated before, this is a crucial meeting (begins at 9:00 a.m.) setting the stage for the development of the budget and all of the issues the business community has discussed with legislators over the past four months.
Last week, economists painted a gloomy picture of the job growth opportunities in Rhode Island. December of 2018 saw the state reach its high point in the number of jobs, a number that appears to have been overstated at the time. Rhode Island lost about 2800 jobs in the last quarter, and with the overstated job number from December, it appears the state has 10,000 fewer jobs than that reported at the end of 2018. An economist from HIS Markit provided testimony that 3,200 jobs were eliminated from the administrative support sector (including office personnel, HR, security and collections) and the waste management services sector. The HIS experts do believe the state will experience a slight growth in jobs but that the economy is basically headed for a flat growth by 2023. Young people – ages 16-24 are expected to exit Rhode Island, as the percentage of workers age 55 and over increases.
Retail Acceptance of Cash
The House Corporations Committee is expected to pass H.5116 in an amended form on Tuesday. The proposed SubA requires all retailers to accept cash for payment of goods and services except any on-line purchases or any internet purchases.
Naloxone In Public Places
On Tuesday, May 7 at the Rise, the Senate Committee on Health and Human Services will take testimony on S.827; a bill that requires public places (places holding 100 or more people) to have on site a naloxone box and at least one person properly trained in how to administer the life-saving injection or nose spray to anyone experiencing a drug overdose. The bill does contain a Good Samaritan clause protecting anyone who acts (or fails to act) to assist a person in need unless it constitutes gross negligence or willful or wanton conduct.
School Building Projects Union Only
The Senate Labor Committee appears ready to pass S.713 SubA on Wednesday at 3:30 p.m. The bill requires school building projects, valued at $5 million or more, to hire only contractors that have – prior to bidding on the project - apprentices in every “apprenticeable trade” that will be needed to complete the job. The contractor must also ensure that no less than 10% of the labor hours worked on the project are performed by apprentices. An escape clause exists in the bill; but the clause is only triggered after the bid has been awarded. The wording of this bill ensures that only union contractors will be able to bid on these school projects, because no merit shop contractor can meet the apprenticeship requirement given the apprentice to journeyman ratios that currently exist in Rhode Island law.
Employee Bills In Senate Judiciary
Thursday, May 9 at the Rise will find the Senate Judiciary Committee taking testimony on various employee/employer bills. S.169 proposes to end Rhode Island’s Employee-At-Will doctrine. S.460 changes the definition of employee under the Fair Employment Practices Act to include family members, apprentices, volunteers, unpaid interns, and elected officials. The bill also allows employees to be held individually liable for actions against fellow employees. S.493, submitted on behalf of the Attorney General’s office, adopts a version of what is known as the MA 93A law. The AG’s office would be permitted to seek civil damages for violations of the Deceptive Trade law as interpreted by the AG. This bill is particularly troublesome for industries that are heavily regulated by other agencies, as what one agency believes is an appropriate action, the AG could interpret differently and bring charges. Finally, S.598 forbids an employer to require an employee to execute a nondisclosure agreement; or non-disparagement agreement regarding alleged violations of civil rights or criminal conduct as a condition of employment.
The following bill was filed last week:
House Bill No. 6054 Azzinaro, Kennedy, Shekarchi, Edwards, Blazejewski, AN ACT RELATING TO BUSINESSES AND PROFESSIONS -- MOTOR VEHICLE REPAIR SHOP ACT (Allows a motor vehicle repair shop owner to sell, at a commercially recordable sale, a customer's vehicle if they fail to pay over thirty (30) days of properly charged storage fees.)
House Bill No. 6062 Ackerman, Shekarchi, Bennett, Amore, McNamara, AN ACT RELATING TO HEALTH AND SAFETY -- RESTROOM ACCESS ACT (Requires retail establishments with 3 persons or more on premises without public restrooms to allow customers to use employee restrooms for certain medical conditions upon presentation of documentary proof with violators fined $250. Effective 1/1/20)
Senate Bill No. 827 Valverde, Miller, Goldin, AN ACT RELATING TO HEALTH AND SAFETY - NALOXONE PUBLIC ACCESS PROGRAM (Requires public places to have naloboxes or naloxone on the premises for access and use during emergencies by trained employees or the general public with "Good Samaritan" protections.)
Senate Bill No. 835 Lombardi, Ciccone, Lombardo, Gallo, McCaffrey, AN ACT RELATING TO LABOR AND LABOR RELATIONS -- UNLAWFUL EMPLOYMENT PRACTICES (Prohibits an employer, employment agency, labor organization, or employee, to commit any act declared to be an unlawful employment practice; individuals would be held personally liable for such conduct.)
Senate Bill No. 836 Lombardi, Ciccone, Lombardo, Gallo, McCaffrey, AN ACT RELATING TO LABOR AND LABOR RELATIONS - PAYMENT OF WAGES (Creates a mechanism for employees to enforce their existing right to continuation of medical benefits, reinstatement of status and benefits after returning from being a temporary caregiver and relating to Sunday wage laws.)
Senate Bill No. 848 Goodwin, Ruggerio, McCaffrey, AN ACT RELATING TO COURTS AND CIVIL PROCEDURE -- PROCEDURE GENERALLY -- CAUSES OF ACTION (An insurer found in violation of the unfair claims settlement practices act can be liable for three (3) times the amount of damages.)
Senate Bill No. 849 Goodwin, Ruggerio, McCaffrey, AN ACT RELATING TO INSURANCE -- UNFAIR CLAIMS SETTLEMENT PRACTICES ACT (Amends and expand the definitions of unfair claims practices committed by insurers with regard to physical inspection, performance of appraisals, retail valuation and total loss notification to owner.)
For those that read the budget cover to cover, surprises still surface during the complicated fiscal analysis that takes place over months of hearings. One item surfaced last Thursday in the Senate Finance Committee hearing. With only rumors surrounding the source of $900,000 included in the Governor’s budget, committee members, staff and members of certain segments of the business community waited for the Department of Revenue to explain. The Lottery Commission plans to begin selling keno through online sales in January, 2020. The Commission believes it can do this without additional legislative approval. For lottery agents such as convenience stores, liquor stores and other brick and mortar lottery sales facilities, this spells trouble. Many wonder, “If the Commission believes it can do this without legislative action, can they not then sell other lottery tickets?”
According to a 2016 report by the North American Association of State and Provincial Lotteries, Rhode Island had the second highest per capita lottery spending in the country. Rhode Islanders spent $1054 per person without access to internet gaming. Massachusetts came in first at $1088. The average per capita per state in 2016 was $371.19. Michigan which already instituted internet online lottery had a per capita spending of $414.
In January of 2019, the federal Department of Justice (DOJ) released a new opinion placing into great question whether states can implement online lottery gaming without violating the federal Wire Act, a 1961 law put in place to counter organized crime gambling. A federal judge gave the DOJ until the end of April, 2019 to clarify its opinion. Many issues remain to be resolved surrounding this issue, but the inclusion of the expansion of gaming in the Governor’s budget still has $900,000 attached to it as available revenue.
Senate Environment – Straws and Global Warming
On Wednesday, At the Rise (approximately 4:30pm) in Room 211 at the State House, the Senate Committee on Environment and Agriculture will vote on S.292, An Act Relating to Food and Drugs – Single Use Plastic Straws. As currently written, the bill would ban food establishments – including theaters, convenience stores, restaurants, hotels, etc. – from offering single use straws to customers. If a customer requests the straw, the establishment would be obliged to provide it. An establishment found violating the new law would receive a notice for the first two violations. Subsequent violations would result in a $25 fine up to an annual maximum of $300. One outstanding issue revolves around straw dispensers; will a customer’s use of the dispenser be interpreted as “requesting” a straw.
Also, on the committee’s agenda is S.662 which calls for a $15 per ton carbon tax on fossil fuels, increasing every year thereafter. This bill has been heard in previous years. It would dramatically increase the cost of transportation fuel, heating fuel and electricity. The goal of the bill is to increase the cost of fossil fuels to the point where individuals will have to switch to another source of fuel. The bill does not provide an alternative.
House Labor To Look at Non-compete Clauses
Also on Wednesday, At the Rise in Room 203, the House Labor Committee will hear testimony on H.6019, Rhode Island Noncompetition Agreement Act. The Chamber submitted testimony on the Senate version, S.698, last week. The bill is meant to ban the use of non-compete clauses for low wage earners as well as certified nursing assistants (a group that requested this bill).
Courts generally do not look favorably on non-compete clauses. If utilized, they need to be limited in time and scope, and often geographically. However, the Chamber in its testimony did point out that there are circumstances that warrant the use of such provisions. Employees who have access to trade secrets or unique clients could cripple a company. Research assistants who have been working on new products have the ability to damage a company. Technology employees could perhaps have access to information that could be used to start a new company in direct competition with the previous employer. These are just a few examples of situations that might warrant a non-compete agreement.
The definition of “Low-wage employee” is problematic in H.6019. The definition appears to tie to 28-33-20 which is the statute governing workers compensation benefits. When an employee is injured on the job, the benefit paid to that individual is based upon the wages paid prior to the harm. The maximum workers compensation benefit is 125% of the state’s average weekly wage. If the Chamber is interpreting the “low-wage employee” definition laid out in H.6019 correctly, a person would be deemed to be a low wage earner if they make twenty-five percent (25%) more than the average weekly wage. That seems out of balance. The Chamber pledged to work with the Senate and House sponsors to draft a bill that would address low wage earners. If you have concerns about this bill, please contact the Chamber.
The following bill was filed last week:
House Bill No. 6019 Blazejewski, AN ACT RELATING TO LABOR AND LABOR RELATIONS -- RHODE ISLAND NONCOMPETITION AGREEMENT ACT (Creates a comprehensive statutory scheme to address all aspects of noncompetition agreements.)
House Bill No. 6027 Serpa, AN ACT RELATING TO HUMAN SERVICES -- MEDICAL ASSISTANCE - LONG TERM CARE SERVICE AND FINANCE REFORM (Provides for a Medicaid home care, home nursing care and hospice base rate adjustment for services delivered to beneficiaries in rural communities as defined by the department of health.)
House Bill No. 6033 Bennett, Edwards, Kennedy, McNamara, Almeida, AN ACT RELATING TO HEALTH AND SAFETY - LICENSING OF MASSAGE THERAPISTS (Makes sweeping changes to the law on massage therapy licensing.)
House Bill No. 6038 Tobon, Shekarchi, Blazejewski, Edwards, Craven, AN ACT RELATING TO BUSINESSES AND PROFESSIONS -- SOCIAL BENEFIT BUSINESS PROGRAM (Establishes the Social Benefit Business Program.)
An Update from the State House
As we enter the final phase of the 2019 legislative session (marked by the end of the General Assembly vacation break), we can expect bills to be voted on in committee and on the floor, and a budget to be released in early June. The Chamber may be asking for your help to make the voice of the business community known to legislators and to the Governor very quickly. Please watch, not only for editions of Under the Dome, but for email alerts and calls to action.
Chamber Legislative Reception
Don’t forget – the Chamber of Commerce Legislative Reception will be held Wednesday, April 24th at the State House. This is your opportunity to meet legislators and to share your thanks for their service as well as to express any legislative concerns.
Timely Building Inspections
The House Corporations Committee will take testimony on H.5989, a bill that mirrors one of the Senate economic development package bills. The hearing will be held Tuesday, at the Rise (approximately 4:30 p.m.) in Room 203. H.5989 allows a contractor to hire a qualified third-party assistant or state inspector to perform an inspection if a municipal building official fails to perform an inspection within forty-eight (48) hours after notification of the need for the inspection; and the contractor notifies the city/town of its intent to hire someone to complete the inspection. The contractor would pay for the third party inspection, while the city or town would pay for state inspector services. http://webserver.rilin.state.ri.us/BillText/BillText19/HouseText19/H5989.pdf
Senate Judiciary Faces Landlord Issues
If you own residential rental property, Tuesday at approximately 4:30 p.m. in Room 313, you may want to attend the Senate Judiciary hearing. Various issues will be up for hearing such as S.30 which mandates that a landlord have a general liability policy of at least $100,000 in effect for those injured on premises due to the landlord's negligence http://webserver.rilin.state.ri.us/BillText/BillText19/SenateText19/S0030.pdf . Failure to provide proof of insurance would preclude a landlord from proceeding on an eviction action. S.71 prohibits residential landlords from terminating period tenancies from December 1 to February 1 and would require sixty days written notice to the elderly or disabled prior to termination of a tenancy http://webserver.rilin.state.ri.us/BillText/BillText19/SenateText19/S0071.pdf . S.154 imposes a penalty against a condominium association that fails to deliver a resale certificate within ten days of a request by a unit owner http://webserver.rilin.state.ri.us/BillText/BillText19/SenateText19/S0154.pdf . S.231 prohibits a landlord from asking about the immigration status of a tenant, prospective tenant, occupant, or prospective occupant of residential rental property http://webserver.rilin.state.ri.us/BillText/BillText19/SenateText19/S0231.pdf . S.479 requires real estate sellers to provide buyers with an annual building energy cost estimate and imposes a duty on sellers to conduct real estate condition inspections http://webserver.rilin.state.ri.us/BillText/BillText19/SenateText19/S0479.pdf .
Senate Labor Committee Addresses Misclassification of Employees
Wednesday, the Senate Labor Committee has posted a vote on a SubA (amended version) of S.510 which called for increasing the fines for misclassifying employees to $2000 per employee and requiring the Department of Labor and Training to suspend the ability of companies to operate in Rhode Island if a company continues to misclassify employees three times within a two year period. The Senate has posted a SubA for consideration that leaves the fine where it is today – at $400 per employee misclassified. If the employer fails to pay the penalty as required, the license would be revoked until the fine is paid. If an employer is found by the DLT to have violated the misclassification law three times within a two year period – each violation includes all of the employees determined to be misclassified at one time – then the license to operate in Rhode Island must be suspended for three years. Finally, the civil penalty for misclassification of employees changes from “up to $5000 for subsequent offenses” to “not less than $10,000 for subsequent offenses.” The SubA can be viewed at: http://webserver.rilin.state.ri.us/BillText/BillText19/Proposed19/S0510A.pdf
Employer Medicaid Assessment Budget Article
The Senate Finance Committee will be meeting Thursday at the Rise (approximately 4:30 p.m.) to discuss a number of articles in the Governor’s budget. One topic is the Governor’s Medicaid Employer Assessment. This is the proposal – similar to the program in Massachusetts that will sunset December 31st of this year – that will assess an employer up to $1500 per employee that is accepting Medicaid services from the State. The assessment applies to companies with 200 or more employees and would be paid on a quarterly basis. It is important to contact your Senator if you have concerns about this budget proposal, and to let the Governor’s office know as well. The hearing will take place in Room 211 of the State House.
The following bill was filed last week:
House Bill No. 6005 Fogarty, Carson, Caldwell, Cortvriend, Messier, AN ACT RELATING TO INSURANCE -- ACCIDENT AND SICKNESS INSURANCE POLICIES (Requires insurance carriers, nonprofit hospital service plans, nonprofit medical service corporations and health maintenance organizations to cover the costs of breast ultrasounds and or MRI breast exams.)
An Update from the State House
The General Assembly is on break this week. Hearings for the week of April 22 – 26 will be released at the end of this week. Members of the House and Senate leadership teams have been making the speaking circuit. Marijuana legalization appears to be receiving a cool reception as the ability to implement and oversee the vast regulatory program required still appears to be in question. The Governor’s proposed new programs also seem to be in question as the early projected revenues for FY2020 are difficult.
If you attended either of the Eggs and Issues Legislative Breakfasts, then you heard loud and clear a request from legislative leaders worth noting in this edition of Under the Dome. A request has been made to the members of the Chamber of Commerce – please be consistent with your messages to the Governor’s office as well as to the House and Senate offices. If an issue is positive to your business, please share that equally with all branches of government. If an issue will harm your business, please convey that message to the Governor, the Senate Leadership and the House Leadership. While it sounds like a small request, it has been made clear to the Chamber that it is an extremely important request.
Senate Passes Workplace Bills
S.90, known as the Workplace Bullying bill, was passed on the Senate floor 32-6 (Voting no – Algiere, De la Cruz, McKenney, Morgan, Paolino, Rogers). The bill makes employers vicariously liable for any unlawful employment practice committed by their employee. Employers are responsible for preventing and promptly correcting any bullying in the workplace which includes both physical and psychological bullying. The definition of harm is vague, leaving employers open to lawsuits.
S.330 which requires employers of 4 or more employees to conduct sexual harassment programs for new employees within 1 month of the date of hire and all employees by September 1, 2019, also passed the Senate floor 31-7 (Voting no – Algiere, De la Cruz, McKenney, Morgan, Paolino, Raptakis, Rogers).
Both bills have been assigned to the House Labor Committee.
May Revenue Estimating Conference Meetings Set
The May Revenue Estimating Conference begins April 26th and ends May 10th with the adoption of a final agreement on the revenue available for the FY2020 budget. All meetings take place in Room 35 of the State House. The conference panel is comprised of budget analysts from the Governor’s office, the House budget office and the Senate budget office. Experts are already warning that the numbers – expected to be down – may be down even more than originally anticipated.
Friday, April 26, 2019 – Testimony 9:00 AM Cash Assistance and Medical Caseloads – Department of Human Services and Executive Office of Health and Human Services
Wednesday, May 1, 2019 – Follow-up Testimony 9:00 AM Cash Assistance and Medical Caseloads – Department of Human Services and Executive Office of Health and Human Services
Friday, May 3, 2019 – Economic Overview and Testimony 9:00 AM (1) US and RI Economic Forecasts – IHS Markit Michael Lynch, Economist. (2) RI Labor Market Conditions-Department of Labor and Training Donna Murray, Assistant Director, Labor Market Information Unit (3) Consensus Economic Forecast
10:30 AM Unclaimed Property - Office of the General Treasurer Historic Structures Tax Credits - Historical Preservation and Heritage Commission Motion Picture Production Tax Credits - RI Film and Television Office Lottery Receipts - Department of Revenue, Division of Lottery Commerce Corporation Tax Credits – Commerce Corporation
1:00 PM (1) Tax Collections – Department of Revenue, Division of Taxation Neena Savage, State Tax Administrator. (2) Accruals – Accounts and Controls Peter Keenan, State Controller
Monday, May 6, 2019 - Caseload Estimating Conference 9:00 AM Caseload Estimating Conference
Wednesday, May 8, 2019 Follow-up Testimony (if necessary) 9:00 AM (1) Tax Collections – Department of Revenue, Division of Taxation Neena Savage, State Tax Administrator (2) Accruals – Accounts and Controls Peter Keenan, State Controller
Friday, May 10, 2019 – Revenue Estimating Conference 9:00 AM Revenue Estimating Conference
The following bills were filed last week:
House Bill No. 5989 Ucci, Corvese, AN ACT RELATING TO HEALTH AND SAFETY - STATE BUILDING CODE - NEW BUILDINGS AND STRUCTURES (Allows a contractor or builder to hire a qualified third-party assistant or state inspector to perform an inspection if a building official fails to perform an inspection within forty-eight (48) hours after notification.)
House Bill No. 5993 Caldwell, AN ACT RELATING TO TAXATION - LEVY AND ASSESSMENT OF LOCAL TAXES (Allows the town of East Greenwich to adopt a flexible tiered tax classification system regardless of whether it is a revaluation or update year and also to provide an exemption to small businesses for tangible personal property taxes.)
House Bill No. 5996 Slater, Kislak, Almeida, Diaz, Hull, AN ACT RELATING TO COURTS AND CIVIL PROCEDURE--PROCEDURE GENERALLY -- JUDGMENTS, ORDERS, AND DECREES (Provides interest on civil actions be calculated at a rate equal to weekly average one year constant maturity Treasury yield, as published by Board of Governors of Federal Reserve System, for the calendar week preceding the date of the judgment.)
House Bill No. 6004 Phillips, Shekarchi, Corvese, Edwards, Solomon, AN ACT RELATING TO MOTOR AND OTHER VEHICLES -- REGISTRATION OF VEHICLES (Permits the division of motor vehicles to suspend the registration of a motor carrier upon receiving notice that the carrier has failed to obtain workers' compensation insurance.)
Senate Bill No. 803 Ruggerio, McCaffrey, Lynch Prata, Conley, Ciccone, AN ACT RELATING TO TOWNS AND CITIES (Establishes special economic development districts.)
An Update from the State House
This week is the last week before legislative vacation break which takes place April 15-19. Following the break, we can expect to see committees voting on bills and sending them to the House and Senate floor for consideration. The final Revenue Estimating Conference has been scheduled for May 10th at 9:00 a.m. This day-long meeting will result in a determination of the final revenues available for the FY2020 budget, allowing lawmakers and staff to definitively draft a budget.
Small Business Loan Program Hearing
Part of the Senate Economic package includes a small business loan program that provides investors with a state tax credit. On Tuesday, April 9th at the Rise, approximate 4:30 p.m. in Room 211, the Committee will hear S.55 An Act Relating to State Affairs and Government (Conley, Cano, DiPalma, Felag, and Pearson) which proposed to establish a small business development fund designed to encourage the formation of private capital investment by federally licensed investment companies in underserved small businesses, leveraged by delayed, at-risk stream of tax credits applicable against insurance premium and retaliatory taxes that can be recaptured for noncompliance with program investment requirements. Monetary penalties would exist if job creation and retention projections would be missed, and the state shares in profits above a certain level of fund returns. Investments would be designated for targeted growth industries for the state, and would be required to be diversified – no one small business would receive more than four ($4,000,000) million or twenty percent (20%) of a fund's investment authority. The investment funds would report annually, and the program would terminate after six (6) years. http://webserver.rilin.state.ri.us/BillText/BillText19/SenateText19/S0055.pdf
Energy Is the Topic for Senate Environment & Agriculture
On Wednesday, April 10th, the Senate Environment & Agriculture Committee will host a presentation from the Independent System Operator of New England (ISO New England). The meeting will take place in the Senate Lounge at approximately 4:30 p.m. ISO New England is the independent, not-for-profit organization authorized by the Federal Energy Regulatory Commission to oversee the day-to-day operation of New England’s electric power generation and transmission system, administer the region's competitive wholesale electricity markets, and manage comprehensive regional power system planning. This is the organization that has been increasingly warning the state of the need for additional power generation as existing facilities are closed in the New England region. ISO does not advocate for any particular source of generation, but is responsible for ensuring energy is reliable.
S.659, (DiPalma, Goldin, Murray, Euer, Sosnowski) a Senate Resolution Requesting an Assessment of the Benefits to Rhode Island of Enactment of a Green New Deal will also be heard in the Committee Wednesday. It calls for a “bold alternative to business as usual” in order to combat climate change. The resolution requires the Rhode Island Green New Deal Research Council report their findings and recommendations regarding the potential benefits of green new deal initiatives to the Senate by May 15, 2019 for consideration. Rhode Island can be proud to say that it is 49th out of 50 in state rankings of the creation of Greenhouse Gas emissions in the United States. Vermont has the lowest emission rate.
State Job Growth Comparison
Some troubling statistics were recently released by the U.S. Bureau of Labor Statistics. The following table shows the change in jobs for the 50 states and the District of Columbia. According to Ted C. Jones, P.H.D, this analysis is based on seasonally adjusted data from the Bureau covering February, 2018 – February, 2019. Nevada leads the way with a 3.53% job growth over the past year, while Rhode Island comes in last at a -.32%
The following bills were filed last week:
House Bill No. 5945 Edwards, Canario, Shanley, Barros, AN ACT RELATING TO HEALTH AND SAFETY -- BIOMETRIC INFORMATION PRIVACY PROTECTION ACT (Prohibits collection of biometric identifiers without consent.)
House Bill No. 5949 Tobon, Barros, Edwards, Johnston, Blazejewski, AN ACT RELATING TO CORPORATIONS, ASSOCIATIONS, AND PARTNERSHIPS -- RHODE ISLAND BUSINESS CORPORATION ACT (Imposes a fee of one hundred sixty dollars ($160) for all domestic and foreign corporations for a certificate of authority to transact business in this state.)
House Bill No. 5957 Ranglin-Vassell, Donovan, Walsh, Barros, Diaz, AN ACT RELATING TO LABOR AND LABOR RELATIONS - WAGES (Increases min. Wage From $9 to $15 per hour by 1/1/24 and tipped min. Wage From $3.89 to $15 per hour by 1/1/28/Further increases depend on increases in CPI/Non-payment damage awards increased from 2 to 3 times unpaid amount/SOL increased from 3 to 6 yrs.)
Senate Bill No. 753 DiPalma, Lombardo, Conley, Gallo, Valverde, AN ACT RELATING TO FINANCIAL INSTITUTIONS -- LICENSED ACTIVITIES--CURRENCY TRANSMISSIONS (Adds virtual currency to the existing electronic money transmission and sale of check licenses and adds additional regulatory provisions to simplify and clarify licensing related thereto.)
Senate Bill No. 765 Goldin, Miller, Lawson, Satchell, Valverde, AN ACT RELATING TO LABOR AND LABOR RELATIONS -- TEMPORARY DISABILITY INSURANCE (Increases tax wage base for contributions to TDI /TCI, expands eligibility, increases benefit rates, adds sibling and grandchild in coverage benefits, increases temp caregiver weeks, and institutes fines for not reinstating an employee who uses program.)
Senate Bill No. 768 Picard, AN ACT RELATING TO STATE AFFAIRS AND GOVERNMENT -- MANUFACTURING AND ECONOMIC DEVELOPMENT--TAX INCENTIVES (Establishes the "refundable investment tax credit act" to provide for a refundable investment tax credit for certain investments in the construction of facilities, acquisition of tangible property, and the training of employees in the state.)
Senate Bill No. 776 Archambault, AN ACT RELATING TO MOTOR AND OTHER VEHICLES -- SIZE, WEIGHT AND LOAD LIMITS--SMITHFIELD AND LINCOLN (Prohibits commercial motor trucks, with a gross weight rating of twenty-six thousand one pounds (26,001 lbs.) or more, from traveling on Limerock Road, in Smithfield and Lincoln.)
An Update from the State House
For those who have been around the State House for a long time, the legislative activity level has made March feel like a political May. Many of the House committees completed hearings on all of the original inventory of bills filed before the bill filing deadline. The House Finance Committee completed hearings on all of the Governor’s budget articles, leaving only hearings on the Departments’ budgets for future days. Of course a number of bills have been filed since the deadline (see below for the myriad of bills filed last week), but still both the House and Senate appear to be ahead of their historical schedules. What that means, is anyone’s guess.
Naxolone in Public Places
Last week, the House Committee on Health, Education and Welfare listened to proponents and opponents discuss a bill to require “public places,” capable of holding 100 or more people, to keep on site “functional” naloxone boxes with a supply of the drug and one person trained to administer the drug. The bill does include a “Good Samaritan” clause to attempt to protect entities and individuals who provide or administer the drug. However, some outstanding issues remain.
Senate Labor Takes Up Employer Assessment
On Tuesday, March 26th at the Rise (approximately 4:30 p.m.) in room 313, the Senate Finance Committee will take testimony on Article 16 of the Governor’s budget. Section 4 of this article is the employer assessment for each employee – full or part time – that utilizes Medicaid for insurance. It applies to companies with 300 or more employees. An employer in this category would be assessed 10% of the employee’s wages, up to $1500, a year to be paid quarterly. If this is of concern to your business, please contact your Senator and/or attend the hearing.
House Labor to Hear Pay Equity Bill
On Wednesday, March 27th, at the Rise (approximately 4:30 p.m.) in room 203, the House Labor Committee will take testimony on H. 5659, what has been referred to as the “pay equity” bill.
This bill, while well intentioned, sets a legal trap for businesses. It dramatically changes the work world by requiring employers to pay employees the same - not only for “equal work” but for “comparable work.”
Under H.5659, if a wage differential exists, and the employer does not have a seniority or merit system written policy, the burden to prove that the differential is legal shifts to the employer. That burden can only be overcome by proving the following:
1. The reason for the differential is for some reason other than race, color, religion, sex, sexual orientation, gender identity or expression, disability, age, or ancestral origin;
2. The reason is job-related to the position in question; AND
3. It is a “business necessity” which means essential to effective job performance; however, if the employee can demonstrate that an alternative exists to the pay differential and the employer refused to accept the alternative then the employer loses the case.
This year’s bill does include an allowance for pay differentials due to education, travel requirements, training, or shift differential (these are positive changes over last year’s bill)
If the employer fails to prove all three requirements to the Department of Labor and Training then the employee is entitled to unpaid wages – meaning whatever the other employee was getting paid – compensatory damages and liquidated damages up to three times the amount of unpaid wages and benefits deemed to be owed. There is also and additional penalty paid to the DLT - $2500 for the first violation; $3000 for the second violation; $5000 for subsequent violations. The language does provide for some flexibility to lower the fine for small businesses and good faith efforts which includes conducting a wage audit every 3 years.
Finally, the bill allows employers to ask for wage history but they cannot rely on the history when establishing the employee’s wage. In reality, this means no employer should ask for wage history.
The following bills were filed last week:
House Bill No. 5857 Marszalkowski, Morin, Vella-Wilkinson, AN ACT RELATING TO LABOR AND LABOR RELATIONS - TEMPORARY DISABILITY INSURANCE - CONTRIBUTIONS (Permits employees who are covered by employer sponsored disability insurance programs to elect to be exempt from the state temporary disability insurance program, provided the employer has submitted documentation to the director confirming such coverage.)
House Bill No. 5869 Bennett, Handy, Kislak, Donovan, Carson, AN ACT RELATING TO HEALTH AND SAFETY -- ECONOMIC AND CLIMATE RESILIENCE ACT OF 2019 (Establishes a fee on companies that sell fossil fuels in Rhode Island for consumption or distribution within the state and establishes an "economic and climate resilience fund" to disburse the collected funds.)
House Bill No. 5886 O'Brien, Amore, Corvese, Ucci, Morin, AN ACT RELATING TO CRIMINAL OFFENSES -- GAMBLING AND LOTTERIES (Allows social gaming in private residences and in public taverns or private clubs so long as the gambling is incidental to a bona fide social relationship between the participants and only participants receive anything of value.)
House Bill No. 5892 Edwards, Kennedy, Casimiro, Cortvriend, Cassar, AN ACT RELATING TO HOLIDAYS AND DAYS OF SPECIAL OBSERVANCE (Expands definition of "employee" to include a caterer licensed by the department of health and division of taxation and food truck.)
Senate Bill No. 643 Goldin, Miller, Satchell, Valverde, Lawson, AN ACT RELATING TO LABOR AND LABOR RELATIONS -- TEMPORARY DISABILITY INSURANCE (Increases tax wage base for contributions to TDI /TCI, expands eligibility, increases benefit rates, adds sibling and grandchild in coverage benefits, increases temp caregiver weeks, and institutes fines for not reinstating an employee who uses program.)
Senate Bill No. 653 Gallo, Goodwin, Pearson, Quezada, Satchell, AN ACT RELATING TO EDUCATION - SCHOOL COMMITTEES AND SUPERINTENDENTS (Establishes courses that include instruction in career and technical education programs.)
Senate Bill No. 658 Euer, McCaffrey, Sosnowski, Goodwin, Conley, AN ACT RELATING TO STATE AFFAIRS AND GOVERNMENT -- RHODE ISLAND GLOBAL WARMING SOLUTIONS ACT (Establishes the Rhode Island global warming solutions act to reduce carbon emissions across various sectors of the local economy.)
Senate Bill No. 662 Sosnowski, McCaffrey, Conley, Euer, Goldin, AN ACT RELATING TO HEALTH AND SAFETY -- ECONOMIC AND CLIMATE RESILIENCE ACT OF 2019 (Establishes a fee on companies that sell fossil fuels in Rhode Island for consumption or distribution within the state and establishes an "economic and climate resilience fund" to disburse the collected funds.)
Senate Bill No. 679 Goodwin, AN ACT RELATING TO INSURANCE -- ACCIDENT AND SICKNESS INSURANCE POLICIES (Prohibits cost sharing for persons forty-five (45) years or older for colorectal screening examinations, laboratory tests and colonoscopies covered by health insurance policies.)
Senate Bill No. 687 Ruggerio, Lombardi, McCaffrey, Goodwin, Pearson, AN ACT RELATING TO HEALTH AND SAFETY - STATE BUILDING CODE - NEW BUILDINGS AND STRUCTURES (Allows a contractor or builder to hire a qualified third-party assistant or state inspector to perform an inspection if a building official fails to perform an inspection within forty-eight (48) hours after notification.)
Senate Bill No. 690 Crowley, McCaffrey, AN ACT RELATING TO HEALTH AND SAFETY - STATE BUILDING CODE (Amends the number of communities who may combine to appoint a building official and prohibits requiring a building official to perform duties not in the building code when building code duties are pending.)
Senate Bill No. 698 Goodwin, AN ACT RELATING TO LABOR AND LABOR RELATIONS -- RHODE ISLAND NONCOMPETITION AGREEMENT ACT (Creates a comprehensive statutory scheme to address all aspects of noncompetition agreements.)
Senate Resolution No. 711 Lawson, Nesselbush, Metts, Murray, Valverde, SENATE RESOLUTION RESPECTFULLY REQUESTING THE GOVERNOR’S WORKFORCE BOARD TO WORK WITH THE RHODE ISLAND DEPARTMENT OF LABOR AND TRAINING TO DEVELOP A REPORT ON THE FEASIBILITY OF EXPANDING NON-TRADE REGISTERED APPRENTICESHIP PROGRAMS IN RHODE ISLAND
Senate Bill No. 713 Ciccone, Miller, Goodwin, McCaffrey, Lynch Prata, AN ACT RELATING TO PROPERTY AND WORKS - LABOR AND PAYMENT OF DEBTS BY CONTRACTORS (Requires builders on state public school contracts $5,000,000 or more to have 15% of the labor performed by apprentices, and sets forth other consequential requirements for such contracts.)
Senate Bill No. 714 Coyne, Conley, Sosnowski, Sheehan, McKenney, AN ACT RELATING TO STATE AFFAIRS AND GOVERNMENT -- GOVERNOR'S WORKFORCE BOARD RHODE ISLAND (Requires the workforce board to fund a non-trade apprenticeship incentive program in fisheries.)
Senate Bill No. 722 Metts, Goodwin, Miller, AN ACT RELATING TO TOWNS AND CITIES -- HOUSING MAINTENANCE AND OCCUPANCY CODE (Places responsibility on landlords to house evicted tenants due to landlord neglect/gives cities/towns revolving fund account flexibility/allows municipal lien similar to property taxes for action against property.)
Senate Bill No. 725 Ciccone, AN ACT RELATING TO LABOR AND LABOR RELATIONS -- MECHANICAL TRADES (Adds thermal systems insulation workers, apprentices, journeypersons, contractors and masters to the mechanical trades' regulation chapter of the general laws.)
Senate Bill No. 726 Cano, Goodwin, Ciccone, Lombardi, Goldin, AN ACT RELATING TO LABOR AND LABOR RELATIONS -- APPRENTICESHIPS (Comprehensively amends the state's apprenticeship laws to make them easier to understand and be more consistent with each other and applicable federal regulations.)
Senate Bill No. 727 Lombardi, Lombardo, Ciccone, Archambault, McCaffrey, AN ACT RELATING TO LABOR AND LABOR RELATIONS -- MECHANICAL TRADES (Allows the holder of a valid master mechanical trade license to perform repair or renovation work on certain large air conditioning equipment but must subcontract the work if it includes new construction.)