What’s on the 2019 legislative agenda?

Key focus areas: taxes, minimum wage, workforce

While businesses face the possibility of paying higher wages, higher taxes and perhaps higher electric rates as a result of the Democratic takeover of the NH Legislature, they may be rewarded with a better-trained workforce, more affordable housing and more ways to save on energy.

How much of each depends on the balance of power and the level of cooperation during the next legislative session – the first in history with a Republican governor and a House and Senate controlled by the opposite party.

At least 375 bills affecting business have been filed so far this session, and although the language of only a third of the bills had been revealed by deadline, it’s clear that the newly elected Democratic majority in the House and Senate have put forth an aggressive agenda for the coming months.

The following is a brief preview of the legislation.

Taxes

The major battle will be over business taxes, especially the business profits tax, whose rate had already been slashed from 8.5 percent to 7.9 percent, then 7.7 percent this year and a scheduled 7.5 percent in 2021. Senate Democratic leaders are looking to keep the rate at 7.9 percent. Republicans call that a rollback.

But Senate President Donna Soucy argues that if the bill passes quickly – before businesses make their first quarterly payments – it won’t actually be an increase.

In the House, Democratic leaders unambiguously want to roll the BPT rate back to 8.5 percent, but unlike the Senate, leave scheduled business enterprise tax rate cuts in place.

The Business and Industry Association immediately came out strongly against the cuts, and the governor said he would include the cuts in his budget.

“The last thing we should be doing is raising taxes,” Sununu said in his inaugural address.

And watch for a more modest reform, sponsored by Sen. Jeanne Dietsch, D-Peterborough. Her bill would raise the filing threshold for filing a BPT return from $50,000 to $100,000 of gross business income.

Another big upcoming tax initiative is to counter the U.S. Supreme Court’s Wayfair decision, which allows states and cities to require other jurisdictions to collect taxes on online sales. Sen. Jeb Bradley, R-Wolfeboro, will try to resurrect a bill that failed to pass in an emergency session last summer making collection more difficult.

“The main complaint was it was premature,” he said. “Well, other states are starting to line up. Hopefully we can offer some measure of protection.”

Other legislators want the state to defy the court’s ruling and have introduced legislation related to that.

Labor

For years, Republicans have dammed up proposals that would enhance the position of workers. That dam is about to burst. Will Governor Sununu be willing or able to hold back the deluge?

New Hampshire is the only New England state with no state minimum wage, defaulting to the federal minimum of $7.25 an hour. In all of the surrounding states, the minimum wage is at least $10 and going up. That probably will change, though by how much and how quickly remains to be seen.

So far, proposals here have been more modest. Senate Bill 10, to be introduced by Senate President Donna Soucy, D-Manchester, would start at $10 at the end of this year. The leadership hasn’t decided on a ceiling yet. Soucy’s proposal has a couple of twists: The ceiling might be linked to the state of the economy and the wage would actually be a package that could include some benefits by provided by an employer, such as paid sick days.

This might dampen opposition from the governor, who said he is opposed to a state minimum. Business groups are also opposed, but not heading to the barricades over it either.

“Let’s see how much we are talking about,” said Mike Somers, president of the NH Lodging and Restaurant Association. “We could live with something reasonable, if it’s phased in over time.”

A paid family and medical leave program is also not a barricade issue, since workers, not businesses, would pay for it under proposed legislation.

The House bill is expected to look like the one that passed that body three times last year – when it was controlled by Republicans – but defeated in the Senate. It creates a small payroll deduction to fund a program administered by the Department of Employment Services with a possible one-time opt-out. Sununu opposed this proposal as not economically viable.

Under a Senate bill, employees couldn’t opt out, but businesses could, if they set up their own program, and the claims portion would be bid out to a third-party administrator, avoiding some up-front costs and risks to the state.

The BIA is neutral on family leave, with its membership split over the idea. Some would love to have such a program, said David Juvet, the BIA’s senior vice president of public policy, “since it would help attract and retain a younger workforce.”

What worries business organizations more is a slew of worker protection bills that have failed before but could pass a Democratic legislature.

There are bills which would prevent employers from looking into things like credit history or even criminal history when hiring; ban noncompete clauses for low-wage workers; limit the time an employer can use a temp without offering a job; require payment for unused vacation time; and increase pay for those working at night.

Then there is Portsmouth Democratic Sen. Martha Fuller Clark’s bill to require a two-week advance notice of an employee’s work schedule.

Scheduling requirements would “eliminate scheduling flexibility and force employers to deny last-minute time-off requests” resulting in “lost hours and income for employees” and would “ halt innovations in scheduling” including “apps that allow employees to see and ask for open shifts in real time,” according to the NH Retail Association.

Workforce development

There seems to be bipartisan support for proposals to alleviate the state’s ongoing workforce shortage.

Sununu proposes setting up a five-year high school program after which a student will be able to earn a tuition-free associate degree, and the possibility of a job interview at a local company. He also proposes a $24 million one-time investment to grow the state’s healthcare workforce.

Democratic bills also deal with the workforce pipeline: incentives for college graduates who remain in the state; funding a healthcare workforce initiative; and using the state’s unemployment fund for workforce development and job training.

Senator Clark would add another $500,000 in funding to the University of New Hampshire’s Innovative Research Center. The NH Tech Alliance’s big push this year also centers on UNH and putting enough money in the capital budget to fund expansion and upgrading of the university’s biological sciences facilities at Spaulding Hall.

Senator Dietsch has proposed setting up a “sunny day fund” seeded with money from the current budget surplus and to be supplemented whenever the rainy day fund is full, to support high-tech R&D.

“If we want to build a competitive advantage in growing industrial clusters, this is the way to do it,” said Dietsch, founder of Mobile Robots Inc.

Housing

Bills to provide affordable housing to New Hampshire residents, often a Democratic issue, seem mainly to be coming from Republicans this year.

Top on the Realtors and the NH Homebuilders Association wish list is a bill sponsored by Rep. Lynne Ober, R-Hudson, that would create a Housing Appeals Board, which would expedite a developer’s challenge to adverse zoning rulings, since permitting delays can kill projects or increase costs.

Senator Bradley is sponsoring two bills that also may be amendable to the majority. One would allow a one-time appropriation of $10 million and divert $5 million a year from the real estate transfer tax to augment the NH Finance Authority’s Affordable Housing Fund. Another would allow towns to discount the property tax on new multifamily housing projects.

Another major focus of the Home Builders Association is to update the state’s nearly decade-old building codes, which has been held up mainly due to builders’ concern that national codes have gone too far, but a number of stakeholder compromises have been made that should be appearing in upcoming legislation.

Rep. Carol McGuire, R-Epsom, wants to make sure that the codes aren’t too up to date. Her bill would require them to be at least two years old so the state can learn from others’ mistake.

Healthcare

The Affordable Care Act, association health plans and prescription drugs will be the big three issues in health care.

Business groups seem most interested in association health plans. Recent federal regulations not only allow existing trade organizations to band together to spread healthcare risks, but geographic and special interest groups as well.

The state Insurance Department is drawing up some possible legislation to allow this, which Bradley intends to introduce, but it is sure to get a lot of scrutiny. Insurers are worried that such plans will skim healthier lives from the risk pool, and some consumers are worried that they will get sucked into plans without much protection. Rep. John Hunt, R-Rindge, has a bill – similar to one proposed last year by former Republican Sen. Andy Sanborn – that would make the associations easier to form without promulgating extra protections.

Democrats also want to shield the Affordable Care Act, threatened nationally by a president hostile to it and a recent court decision.

A bill sponsored by Senate Majority Leader Dan Feltes, D-Concord, would keep preexisting condition protections. Another bill from House Commerce Committee chair Rep. Ed Butler, D-Hart’s Location, also mandates guaranteed issue, community rating and coverage of essential health benefits.

Transparency should be the goal of prescription drug legislation, say businesses groups like the BIA, especially when it comes to pharmacy benefit managers, which supposedly lower costs for insurance companies, but some say raise costs for consumers. Soucy plans to reintroduce her bill that would register PBMs. Butler has a number of prescription drug bills on the House side.

Energy

Expect a rerun of the net metering debate this year, with another bill that would raise the limit on such projects from 1 to 5 megawatts, allowing large businesses and municipalities to sell back to the grid the renewable energy they generate, at a rate set by the Public Utilities Commission. Gov. Chris Sununu vetoed such a bill last year, calling the rate a subsidy. Two Democrats – Senator Clark NH Rep. Howard Moffett, D-Canterbury – will reintroduce it, joined by Senate Minority Leader Bradley.

A proposal by Rep. Lee Oxenham, D-Plainfield, would tax carbon and likely receive less bipartisan support. The tax would start at $20 a ton in 2020, but increase over the next decade to $120 a ton. The money would go to property tax relief as well as energy programs for residents and businesses.

Rep. Robert Backus, D-Manchester, a fossil fuel foe who now chairs the House Science, Technology and Energy Committee, has an intriguing bill that would make it harder to object to an energy generation proposal on the ground of aesthetics.

“We want the SEC (Site Evaluation Committee) to consider evidence, not just people’s opinions,” he said. “Beauty is in the eye of the beholder.”

That’s a bill that might both please those wishing to build wind farms, but also those wishing to build transmission lines as well. 

LSR#	BILL#	PRIME SPONSOR	TITLE OR DESCRIPTION
		ENERGY
0090	HB365	Howard Moffett	Increases the cap net energy metering limits for customer generators from 1 to 5 megawatts
0177	SB	Jeb Bradley	Increases the cap net energy metering limits for customer generators from 1 to 5 megawatts
0765	HB	Lee Oxenham	A tax on every ton of carbon equivalent fuel sold, used, or entered. Starts at $20 a ton, ends up $120 by 2030.
		GAMBLING/CANNABIS
0211	HB480	Timothy Lang	Establishes a system within the lottery commission for sports betting
0865	SB	Lou D'Allesandro	Allows casino gambling, and sports betting at casinos
0028	HB	Robert Renny Cushing	Would legalize marijuana, regulated by an independent agency
0547	HB	John Hunt	Allows farms to sell the pot they grow at the farm
		HEALTH
0091	HB233	Edward Butler	Establishes some the Affordable Care Act in state law
0362	HB257	John Hunt	Health coverage purchased through a qualified purchasing alliance shall be considered by the department of insurance to be large group coverage
0472	HB	Rebecca McWilliams	Would remove the work requirement of the New Hampshire Granite Advantage healthcare program
0996	SB	Jeb Bradley	Insurance Department bill regulating association health plans
1095	SB	Donna Soucy	Registers pharmacy benefit managers
		LABOR, TRAINING
N/A	SB10	Donna Soucy	Establish minimum wage starting at $10 at end of the year, ceiling depending on economic conditions
0151	HB186	Howard Moffett	Establishes minimum wage of $9.50 by 1/1/21, $12 by 1/1/22
0371	HB	Mary Jane Wallner	Would establish a paid family and medical Leave insurance program run by Department of Employment Security
1052	SB1	Dan Feltes	Would establish paid family and medical leave insurance program. Claims would be handled by a third-party administrator contracting with the state.
0242	HB211	Janice Schmidt	Prohibits an employer from requiring a prospective employee to disclose his or her salary history prior to an offer of employment.
0332	HB253	Michael Cahill	Prohibits employers from asking a job applicant about his or her criminal history prior to an interview
0978	SB	Martha Fuller Clark	Require employers give hourly paid employees 14 days notice of work schedule
0636	SB	Jay Kahn	Establishes the New Hampshire college graduate retention incentive partnership program and making an appropriation
1032	SB2	Kevin Cavanaugh	Reduces unemployment insurance tax, increases job training from $2  million to $6 million
		REAL ESTATE, CONSTRUCTION
0011	HB104	Lynne Ober	Establishing a housing appeals board within the attorney general's office
0125	HB176	Rick Ladd	Changes grants for school building aid from $50 million maximum to $50 minimum
0304	HB247	Steven Beaudoin	Updates most codes but not the energy code and, in case of conflict, the less stringent code should apply
0398	HB261	Chuck Grassie	Cuts arsenic limits in drinking water by in half
0471	HB309	Kermit Williams	Allows stopping foreclosure by filing a complaint, which can only be overturned in court
0483	HB312	Dave Testerman	Regulates tiny houses
0898	SB22	Jeb Bradley	Allows towns to discount on the construction part of property taxes for up to 10 years for public benefit
		RETAIL/HOSPITALITY
0009	HB102	Christy Bartlett	Allows towns to regulate the distribution of single-use plastics
0920	SB23	Harold French	Prohibits towns from establishing a minimum age to purchase a product that is higher than that required by state law
0373	HB390	Michael Cahill	Drops a restaurant or bar’s Keno take from 8 to 5 percent
		TAXES/FEES
0176	SB	Jeb Bradley	Bill, originally considered in special session, that would make it harder for other states to collect the internet sales tax
0689	HB	Susan Almy	Would roll back BPT decrease all the way to 8.5 percent. Would allow decreases in BET to continue.
0891	SB	Lou D’Allesandro	Would roll back BPT and BET decreases to last year’s rates; BPT would be at 7.9 percent.
0907	SB	Jeanne Dietsch	Increases the minimum gross business income threshold required for filing a business profits tax return from $50,000 to $100,000
0241	HB478	Norman Major	Imposes extra registration fee of $111 a year on zero emissions vehicles, sliding scale on vehicles with more than 20 MPG
0378	HB	Michael Abbott	Increases the road toll and provides funding for state road and bridge projects
		TECHNOLOGY
0047	HB132	Lee Oxenham	An ISP must be net neutral in order to get state contracts
0861	SB	David Watters	Sets up restrictions for driverless car testing and pilot programs
0908	SB	Jeanne Dietsch	Establishes a sunny day fund. If rainy day fund is full, use surplus to support high tech R&D.