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Finance & Revenue
Finance & Revenue
3 Failings of a State’s Pension Consolidation Plan
Where: Illinois
What: Illinois looks to consolidate 650 suburban and downstate police and fire municipal pension funds
How much will the state save? Estimated savings to the state is $850 million to $2.5 billion over 5 years
3 concerns over the consolidation:
- savings will be overwhelmed by the weaknesses of the pension systems
- there are no reforms to contributions or distributions
- Moody’s Investors Service has warned that without major cuts, tackling the state’s pension debt is futile
Chief Investment Officer | Plan to Merge Strapped Illinois Local Pension Plans Raises Doubts
Local TREND. Cities Partner to Fund 529 plans for Young Students.
Where: Miami
What: Kindergartners attending public schools in the City of Miami are eligible for a savings account with a deposit of up to $50
Who is Miami partnering with? Future Bound Miami
News 7 Miami | Thousands of Miami kindergartners will now be eligible for savings accounts
State College Fund Partnership.
Where: Oregon
Who is partnering? BottleDrop and the Oregon College Savings Plan
What will be the result? Funds from collecting cans and bottles for recycling can be automatically deposited into a college savings plan
Salem Reporter | Oregon now lets you turn empty bottles and cans into college savings
Sustainable Investing by the Numbers.
50% decrease in skeptics of sustainable investing in 3 years
11% are skeptical this year, down from a high of 20% in 2017
75% Three-quarters of investors expect sustainable investing to increase in importance
84% of investors in Europe believe sustainable investing will increase in importance
Who is behind the numbers? Schroders’ Institutional Investor Study 2019 involving managers of $25.4 trillion in assets
Chief Investment Officer | Sustainable Investment Skeptics are Becoming Believers
Regulatory Issue. Cannabis Industry & Tax Payments. Regulatory Shutdown of an industry.
Where: Missouri
What: Missouri Department of Health and Senior Services
Proposed rule from the MO DHSS: “…shall pay all fees, penalties, or taxes due to Missouri state governmental agencies via any payment method normally acceptable to those agencies other than cash.”
Anatomy of a Sports Betting Constitutional Amendment
Where: California, 1 of 2 “holy grails” in sports betting frontier
The proposed legislation: SCA 6 (2020 | CA)
Voting would occur: November 2020
What’s the key language? “(h) Notwithstanding subdivisions (a) and (e), the Legislature by statute may authorize and provide for the regulation of sports wagering.“
2019 Elections and Sports Betting
- COLORADO legalized sports betting 50.62% to 48.38%
- revenue will fund WATER PLANNING
- New Hampshire 5 OF 9 cities legalize sports betting
- Legislation allows the NH lottery to operate sports betting retail locations
Sports Handle | Colorado Voters Legalize Sports Betting
Concord Monitor | 9 N.H. cities to vote on whether to allow sports betting
Legislative TREND. Sports betting + Fantasy Sports
Where: Michigan
What is the legislation?
- HB 4916 (2019 | MI) , HB 4917 (2019 | MI) , HB 4918 (2019 | MI) Sports Betting Act
- HB 4308 (2019 | MI) Fantasy Sports
- HB 4323 (2019 | MI) Prohibiting Offshore Online Betting
How will the sports betting framework function?
- Michigan Gaming Control Board will regulate internet gaming
- Casinos prohibited from offering online games that directly compete with the Michigan Lottery
- $80-$100 Million in estimated annual tax revenue
- 8.75% tax rate on sports betting
- 4%-23% rate on online betting
- 19% tax rate for existing casino gaming
Texas New Statewide Executive Director for Economic Development
Who: Adriana Cruz
What’s her title? Executive Director of the Economic Development and Tourismdivision within the Office of the Governor.
What is her background?
- Most recent gig: President of the Greater San Marcos Partnership
- Vice President of Global Corporate Recruitment for the Austin Chamber of Commerce
- B.B.A. in Marketing from the University of Texas at Austin
When does she start? December 5, 2019
Governor Abbott Names Adriana Cruz Executive Director Of Economic Development And Tourism
Tax Free Medical Cannabis Donations
Where: California
What: Starting March 1, 2020, up to $ 53 million “compassionate” medical cannabis donations will be recognized in California
How: SB 34 (2019 | CA)
Why: Medical marijuana advocates recognized an oversight in the state’s medical marijuana laws that did not allow for tax free gifting for patients of need
Leafly | Gifting cannabis to the terminally ill becomes tax-exempt in California
Business TREND. Workforce Development Opportunity in your state.
What: Lyft is partnering with nonprofits to offer rides to job interviews, job training & the first 3 weeks of new employment
Who are Lyft’s nonprofit partners?
TREND. Gig Economy. Employee Classification Constitutional Amendments.
Where: California
Who is championing a constitutional amendment to define gig workers? Uber, Lyft, Door Dash
Why? In response to the Legislature enacting a law that classifies the gig workers as employees
Is the proposition more than this law doesn’t apply to our companies? Yes, it will offer gig workers:
- Guarantee that drivers would make 20% more than the minimum wage
- 30 cents per mile for expenses such as gas & wear and tear
CNN Business | Uber, Lyft, DoorDash unveil ballot measure to fight California gig economy law
Houston Chronicle via AP | Lyft, Uber will ask California voters to block employee law
City Adopts User Fee
Where: Wheeling, WV
What’s a User fee? $2 weekly tax on people who work within the city limits
Why a user fee? A method to fund a $21 million public safety building which failed to gain voter approval
How would the user fee be implemented?
- Employers will take the fee out of paychecks
- Self-employed individuals will make quarterly payments
- $1 of the fee will fund the public safety building
- $1 would go toward infrastructure
The Intelligencer | City Officials Talk User Fee, Public Safety Building
Faith Based Tax Credits & U.S. Supreme Court
Hello to new legislation from all State Legislatures once this case gets decided.
What’s happening? The US Supreme Court will decide a case from Montana on educational savings accounts/vouchers that permit tax dollars to be used for religious, private schools
What’s the issue the court will decide?Whether the US Constitutional permits religiously neutral student-aid program simply because the program affords students the choice of attending religious schools.
How many states could this impact? 37 states
UPDATE. Pension Divests From Private Prisons
Which pension system? CALPERS
Who else has divested from private prison operators?
- As of November 2018, California State Teachers’ Retirement System (CalSTRS) divested $13.7 million
- Bank of America
- Wells Fargo
The impetus: Operation of ICE facilities in Dilley & Karnes, Texas
+1 State Setting Up College Savings Plan for Kinder Students
Where: Oregon
What: Oregon is setting up college savings accounts with $25
How have Oregon universities responded? Willamette University is matching investments made by students before they start high school up to $40,000
KATU 2 | Willamette University offers to match savings for Oregon’s Kinder Grad participants
ISD partners with Bank. Sets of Savings Accounts for Students.
Where: Feria ISD, Texas
Who: Students in Kinder and 1st will receive college savings accounts, set up by the ISD for the students
CBS 4 Valley Central | La Feria ISD to provide savings account for students
+1 State. Fair Pay for NCAA Play Legislation.
Which state followed California’s lead? Florida
What does Florida’s NCAA fair pay for play bill look like? HB 251 – Students Participating In Intercollegiate Athletics (2019 | FL)
Are other states considering similar legislation? Yes, South Carolina and North Carolina
UNF Spinnaker | Florida legislature proposes bill allowing athletes to profit
Lege TREND. Adding racial impact statements to bills in a Red State.
Where: Nebraska
What: adding racial impact statements to fiscal notes
Is this a new thing? No, Iowa started minority impact statements in 2008
Why did Iowa add racial impact statements? A response to prison populations that were heavily black and Latino
Lincoln Journal Star | Legislative Rules Committee considers racial impact statements for bills
State Contract Canceled for Statements by Contractor. Hello, words matter. Be kind.
Which state ended a state contract over something a contractor said? Michigan
What contract? A $600 M investment contract for a state pension system
Who said what and where? CEO made “completely unacceptable” comments at an investment conference in Tiburon, CA. His comments included references to dropping acid & his moral opposition to charities.
What did the pension system say? “There is no excuse to not treat everyone with dignity and respect.”
AP via Star Tribune | Michigan ends pension contract over investor’s comments
Au revoir Banning Plastic Bags. Bonjour Taxing Plastic Bags.
Where: Sweden
What’s the background: Swedish retailers have charged for plastic bags for decades. Charging 1-2 SK (50 cents approx.)
What’s the proposed tax?
- 3SK tax on single use plastic bags
- 0.3SK tax on fruit & vegetable plastic bags
- tax would be paid by those who produce or import the plastic bag
12th State to Legalize Cannabis Tax Plan
Which state wants to the 12th state to legalize? New Mexico
How did the proposal for legalization come to fruition? A stakeholder group formed by the Governor
What is the tax revenue proposal for legalized cannabis?
- An average tax rate of 17%
What other requirements would be implemented?
- testing and labeling requirements
- state-level licensing
- Revenue would fund the state’s medical cannabis program
- Local governments will determine where cannabis dispensaries are located
Pitfalls legislation in New Mexico looks to avoid?
- Over taxation that drove growth in the blackmarket
- In cases of shortage, medical patients get preference for purchasing
+1 TX City Short Term Rental Tax
Where: Corpus Christi
What: a short term rental tax for rentals booked through short term rental sites like Airbnb and Homeaway
How would the tax be collected?
- added to a guest’s bill
- paid directly to the city by the rental sites
KRIS 6 News | City Council to vote today on vacation rental tax increase
Lodging Tax Revenue Conundrum. Double Taxation on Short Term Rentals.
Which state is considering statewide short term rental law? New York
What do the bills look like? AB 2928 (2019 | NY)
Where does double taxation come into play?
- Currently local governments have imposed local lodging taxes and permit fees for short term rentals
- Does a statewide tax system replace existing local taxes? Or, is statewide taxation system on top of existing lodging taxes?
Hudson Valley 360 | State eyes regulation of short-term rentals
Lege TREND. Tax Deductions for Cannabis industry
Where: California
What tax breaks?
- 3 year reduction of the cannabis excise tax to 11%
- suspend the flower cultivation
The legislation: AB 286 (2019 | CA)
Why the tax breaks? To allow legal industry to overtake the blackmarket
Prisons and Drones. An economic threat to prisons?
Where: Virginia
How many drone sightings carrying contraband into prisons are we talking about? 33 in January 2018 alone
Do Virginia’s drone laws limit flight over prisons? No
Which states have banned drones over prisons? California, Florida, Kentucky
Governing | Drones Dropping Off Packages Pose New Threat to Prisons
Local TREND. Prohibit the Use of Self Deleting Apps by city officials
Where: Missouri
What are self deleting apps? Apps that delete information
Why are self deleting apps a problem?
- The auditor say they fly in the face of open government & transparency
- The State Records Commission has new guidelines related to electronic communications that prohibit self deleting apps
Democrat News | Auditor calls on local governments to ban use of self-deleting applications
New Support for Cannabis Legalization
Where: Oregon
The new group leaning to support: Oregon Teachers Union
The decriminalization proposition: Oregon Votes
Why are the teachers backing decriminalization?
- access to affordable and effective treatment
- support services and stable housing
The catch in cannabis tax revenue appropriations:
- transfer of all revenues in excess of $11,250,000 ($11.25 million) quarterly into the new drug treatment fund
Examples of Cities Use of Cannabis Tax Revenue.
Grover Beach, California
- Cannabis revenue makes up 10% of its revenue base
- Funding:
- law enforcement
- fire personnel
- pedestrian safety
- parks
- public service
KSBY | $950,000 from Grover Beach cannabis tax spent on police, fire and parks, city says
Lee, Massachusetts
- $140,000 in revenue for the first 3 months, for a town with an annual budget of $25M
- Benefits to the city:
- Jobs
- Strengthened the local economy
3 Ways Banking Regulations Not Keeping Up with Cannabis Legislation
- State banking regulations are not keeping up with federal changes in cannabis laws
- States struggle with how to test hemp for THC levels and that leaves the industry without clear banking guidance
- Unclear regulatory structure & guidance keeps banks and credit unions from servicing the hemp industry
Lege TREND. Local Public Banks. A Cannabis solution?
Where: California
The legislation: AB 857 (2019 | CA) signed by Gov Newsom
What are the bill’s policy goals?
- Make tax dollars work for our communities
- Tax revenue should serve a public purpose
What limitations are placed on local public banks?
- 10 public banks maximum
- 7 year authorization
Opposition: California Banker Association
+1 Pension Divestment from Private Prisons
Where: Pennsylvania
What sparked the PA pension divestment from private prisons?
- negative press for the private prison firms
- whether teachers and law enforcement should financially benefit from prisoner telephone call proceeds
Philadelphia Inquirer | PA’s millions: Pensions split on private-prison protest
Lege TREND. Student Athlete Compensation.
Where: California & Alabama
What: legislation that allows student athletes to receive compensation for endorsements for their likeness and allows for contract limitations between players and universities
The Opposition: NCAA & quietly universities who lose the revenue
Washington Post | California did the right thing. Don’t buy into the NCAA’s propaganda.
Local TREND. Pilot Project for Polite Tourism.
Where: Kyoto, Japan
What is this pilot program for politeness? A smartphone update with proper etiquette and protocol in popular tourist spots
How will Kyoto measure the effectiveness of the pilot program? Footage from security cameras looking for offenders who walk and smoke, stop in the middle of the road, or take pictures of geishas without permission
Time Out |Tokyo | Kyoto starts pilot project to promote polite etiquette among tourists
Local TREND. City Tackles Homelessness with $40M in private funds
Where: Anchorage Alaska
Who contributed $40M in private funds support?
- Providence Health & Services – $15 million over five years
- Weidner Apartment Homes – $10 million over five years
- Premera Blue Cross Blue Shield – $5 million over three years
- The Rasmuson Foundation
The strategic plan to curb homlessness will be a partnership between these entities, the city, and local non-profits.
KTUU | Private funders donate $40 million towards solving Anchorage’s homelessness problems
Pension TREND. ESG Investment Prominence.
Where: UK
What: UK’s Pension Minister is establishing ESG investment criteria for pensions to focus not only on the sustainability and ESG metrics of investments but to also consider the pension members ethical and environmental views
How does this impact returns?
- ESG is no longer about just being good to the environment
- ESG is talking about the risks facing a portfolio
- An ESG conversation is also necessary to protect a pension audit trail
IPE | UK: ESG moves up the trustee agenda
How a State Rolled Out Online Sports Betting with no Specific Legislation.
Where: Oregon
What agency will oversee online sports betting in Oregon? Oregon Lottery Commission
How does the Oregon Lottery Commission have this authority? The Lottery Commission is delegated broad authority to decide what games occur in Oregon
Is there retail sports betting? Not yet. Online sports betting contract was awarded prior to the NFL season
Must people register in person?No, people can register online to use the online sports betting
European Gaming | GAMBLING IN THE USAOregon Lottery to Launch its Online Sports Betting Game in October
Anatomy of State Procurement Plan.
Where: Texas
What’s the timeline for agencies to complete this procurement plan? Must to be to the Comptroller by November 30, 2019
What information goes into a state agency procurement plan?
Texas Comptroller of Public Accounts
Statewide Procurement Division
FY20 Agency Procurement Plan Template
Instructions:
Please complete the information below and submit it with the requested attachments to procurement.plans@cpa.texas.gov by November 30, 2019.
General Information
Agency Name:
Agency Number:
Procurement Director Contact Information
Name:
Phone Number:
E-mail Address:
Purchasing Capacity Assessment
Dollar value of agency delegated purchases for FY19:
Number of purchasing FTEs:
Automated purchasing tools used by the agency (if applicable):
Please attach the following:
- Copy of agency’s purchasing and contract management procedures which include protest procedures developed by the agency.
- Credit card procedures regarding the issuance and security of payment cards and the use of those cards by the agency’s employees.
- Attach or provide links to any SAO audits of purchasing and contract management functions for FY19-FY20
- Attach or provide links to any Comptroller post payment or procurement audits for FY19-FY20
Certified Procurement Professionals
Number of certified purchasing FTEs:
Number of certified contract management FTEs:
Please attach the following:
- Name, title and certification number for each purchasing FTE
- Name, title and certification number for each contract management FTE
Training Projections for the Fiscal Year
Number of seats needed for CTCD certification courses for FY20:
Number of seats needed for CTCM certification courses for FY20:
Delegated Purchasing Assessment
Please list the names of personnel with delegated signature authority for proprietary justifications:
Please complete the table below with the requested information on your agency’s five delegated purchases anticipated to have the highest expenditure for commodities or services (excluding professional services) not available on an existing contract through CPA or DIR for FY20.
| Delegated Purchases | Est. Value FY20 | Previous FY Value same/similar purchase: | Name of current vendor: | Has the agency looked for the item on CPA or DIR contract? (Y/N) |
Drafting Error in Medical Marijuana Law Allows Other State Residents to Buy
Where: New Mexico
What drafting error occurred in New Mexico’s medical marijuana bill that allows residents of other states to partake in the program? The bill dropped a residency requirement for purchase
Who backed the lawsuit to enforce that medical marijuana in New Mexico be open to nonresidents? A Medical cannabis entrepreneur
AP | Judge says nonresidents can obtain New Mexico medical pot
Local Jail Revenue. Texas Attorney General Opinion.
Who is requesting an Attorney General Opinion? Washington County, Texas
How do I track the opinion process? RQ-0309-KP via Pending Opinions
What question does Washington County want answered? Is revenue from allocating money from the Inmate Trust Fund to a PIN debit system to pay for phone time at the request of an inmate to be credited to the commissary account or to the general fund ofthe county?
Why does this matter? The phone funds either can be used for other purposes in the general fund of a county or for purchases within the jail to fund the operator of the jail
+1 New State Travel Ban
Where: California
How many states are on California’s travel ban? 11, including Texas, Oklahoma, North Carolina, Mississippi and Kentucky
What’s the newest travel ban? Iowa
What did Iowa do to earn a travel ban? removed gender protections under Medicaid
Sacramento Bee | California adds an 11th state to its travel ban. No taxpayer-funded trips to Iowa
Divestment. State Funds. Private Prisons.
Where: California
How is the divestment being pushed legislative or regulatory? Regulatory
Which fund is being asked to divest from private prisons in 2019?
- CALPERS
- The rational: Private Prisons operate detention facilities under contracts with Immigration and Customs Enforcement
Who has divested from private prison investments? Yes, CalSTRS in 2019 voted to get divest $12 million
Sacramento Bee | Two women allege misconduct by Brough + Private prison divestment + Why veto SB 1?
Gig Economy. 2 Reasons Gov. Signed Employee Classification Bill. 2 Industry responses.
Who signed a gig employee classification bill? California Governor Newsom
What bill defined gig workers as employees and not contract workers? AB 5 (2019 | CA)
What did Governor Newsom say in support of the bill and in defiance of tech companies?
- need to create lasting economic security for the workforce
- announced stakeholder group of legislators, business and labor to support more worker protections while preserving innovation
How did industry respond?
- Lyft Agrees with Gov. that rideshare drivers want thoughtful solution balancing flexibility with earnings guarantees and protections
Gizmodo | AB5, Landmark Bill Protecting Gig Workers in California, Becomes Law
Courthouse News Service | Defying Big Tech, Newsom Signs Landmark Gig-Economy Labor Bill
Industry Targeted. Executive Orders. Vape Edition.
Who issued an executive order against the vape industry? California Governor Newsom
What does the Executive Order do?
- creates a $20 million digital and social media public awareness campaign
- Department of Public Health will develop recommendations to reduce smoking rates
- Department of Tax and Fee Administration increase enforcement of e-cigarettes
- Warning signs of the dangers of vaping
Governor Gavin Newsom Signs Executive Order to Confront Youth Vaping Epidemic
Sacramento Bee | Watch Gov. Gavin Newsom explain executive order cracking down on vaping industry
Drafting Error. Delays Weed Revenue to Cities.
Where: Illinois
What was the drafting error? Legalization begins January 1, 2020 but local tax revenues cannot be collected until Sept. 1, 2020
How do I prevent this? Hire people who watch for these mistakes.
Bloomberg Tax | Glitch in Illinois Weed Law Could Delay Towns’ Tax Revenue
Anatomy of a Historical Building Tax Credit Revamp
Where: California
What is authorizing new historic building tax credits? SB 451 (2019 | CA)
How are historic tax credits going to be administered?
- tax credit will equal 20-25% rehabilitation costs IF
- inclusion of affordable housing in the project
- or is part of a military base reuse authority
How many states offer tax credits/incentives for rehabilitating historical property? 35
KPBS | Legislature Passes Bill For Tax Credit For Preservation Of Historic Buildings
State Chartered Cannabis Banking Fails to Pass.
Where: California and Illinois
Which bill failed to pass this week? California’s SB 51 (2019 | CA)
How far did the bill move? Through both chambers but failed to final passage before sine dine adjournment for that legislative session.
Are statewide elected officials behind the passage? Yes, the State Treasurer
Marijuana Legalization: End Run Around Banking Issues. Bitcoin.
Where:
California
How do bitcoin purchases of marijuana help the economics of the industry?
- reduce transaction fees for dispenceries
- improves financial transparency
Statewide legislation for bitcoin and cannabis:
Marijuana Moment | California Lawmakers Use Cryptocurrency To Buy Marijuana From Dispensary
Marijuana Legalization baby step: Expungement
Where:
New Jersey
What happened in New Jersey?
When legalization failed, the Governor proffered legislation to expunge low level offenses
NJ.com | Murphy’s changes to bill clearing weed convictions up for vote Thursday. But no deal yet
Industry Supports Reducing Amount of Recycled Material in Glass Bottles. Read the Legislation.
Where:
California
What’s the legislation?
Which industries support reducing the amount of recycled material in glass bottles?
- Wine Institute
- California Craft Brewing Association
- Beer Institute
- California Manufacturers & Technology Association
Why does industry support this?
- Aligns with standards in Europe and other states
- reflects the Toxics Packaging Clearinghouse model
- reduces the amount of glass that goes to landfills
Woodland Daily Democrat | Legislature OK’s cleanup of glass recycling bill
TX Attorney General Opinion. What is the purchasing authority of a criminal district attorney?
The Attorney General Opinion
Who requested this opinion?
Tarrant County Criminal District Attorney
What question is answered?
Does a criminal district attorney’s office must comply with purchasing procedures and rules adopted by a county purchasing agent?
The answer: no. but there are other rules to follow:
- A county district attorney is a specialized local entity
- As a specialized local entity
- Don’t have to follow the county purchasing agent
- 2 exceptions:
- Could contract with the county purchasing agent
- Any rules that the county purchasing agent adopts under the County Purchasing Act that apply to the county, also apply to the specialized local entity
- 2 exceptions:
- Overall, Chapter 262, Local Government Code, the County Purchasing Act, applies and a specialized local entity is treated like a county
- Don’t have to follow the county purchasing agent
What does this mean?
Competitive Bidding applies
TX Attorney General Opinion. How can cities get around the TX Constitution prohibition against being paid for 2 different governmental roles?
The Attorney General Opinion:
Who requested the opinion?
The City of Ranger, TX
What is the question answered by the opinion?
“whether a city manager in a home-rule municipality may simultaneously serve as the interim or permanent police chief”
The Answer:
- Follow your City Charter & Combine the roles of city manager & police chief by city action
- Create your own loophole around the Texas Constitution
Gig Economy + State Unemployment Funds
What is an example of a gig economy impact on state unemployment fund balances?
A chef sharing service that is being used by NYC restaurants to handle limited pool of employees
How is chef sharing impacting state unemployment funds?
Gig employees are mostly considered contract employees & thus do not pay into unemployment funds.
Donga Ilbo | ‘Chef sharing’ booms in New York as restaurants experience labor shortage
Special Legislative Committee to Handle an Industry in Recession
Where:
Wyoming
What committee?
The Legislature’s Management Council created a special committee to address negative impact of coal industry bankruptcies
What special issues will the special committee consider?
- health care benefits for employees
- funds for reclamation work at mining facilities
- ensuring wages owed are paid
- ensuring local governments receive tax revenue from mining operations
Casper Star Tribune | Wyoming Legislature creates group to tackle fallout from coal bankruptcies
Key Element in State Sports Betting Regulations
Where is this an issue? Nevada
What requirements for sports betting does Nevada have? No online registration process, a person must appear in person
What are other states doing? 9 of 20 that have legal sports better permit mobile registration
How are most sports bets placed in Nevada? By mobile device
Las Vegas Review Journal | Nevada regulators may need to revisit sportsbook registration rules
Local Cultural Institutions. Leaders in Socially Responsible Investments.
What divestments have local museums made? Natural Science museums have divested from oil and gas to support climate change
What investments have museums made to local social justice reform?
- Building for the Arts and Creative Capital & NYC Inclusive Creative Economy Fund supporting low income communities
- Soils Grown Deep Foundation endowment promotes social justice and economic opportunity in arts
What is the goal? Align an institution or foundation’s investments with its values
Financial Times | Museums should lead in socially responsible investing
Revival of Old Land Tax.
Where: Pennsylvania
What is the old school tax system? land value tax from a 19th-century idea to encourage more productive use of large properties
How does a land value tax work?
- levying rates on the land itself
- no tax levy on the structures built
How does this benefit property tax bills?
- tax burden shifts from residential property owners
- homeowners tax bills cut nearly by 1/3
New lingo. Cannabis Debate in State Legislatures
Where: North Carolina
What type of legislation: An agriculture bill S315 (2019 | NC)
What is the new cannabis lingo? Smokeable hemp
What is smokeable hemp?
- smokeable hemp = marijuana
- hemp includes products includes cannabidiol, or CBD
Watauga Democrat | Smokable hemp debate fired up in NC legislature
Local TREND. The new plastic bag ban is the balloon ban
Where: Queen Anne’s County, Maryland
What: Releasing balloons =littering, so cities look to ban the practice
How would the balloon ban work?
- except balloons that are biodegradable or photodegradable
- except balloons released by the government, weather balloons, hot air balloons recovered after launch, or unintentional balloon releases
- maximum $250 fine
Are balloon bans happening elsewhere? YES
- San Francisco
- Baltimore
- Wrightsville Beach, N.C
- Statewide ban in California
- Statewide ban in Connecticut
- Statewide ban in Florida
- Statewide ban in Tennessee
- Statewide ban in Virginia
Are other states or cities considering it? Yes
Route Fifty | Why Local Governments Are Considering Balloon Release Bans
State Law Makes Cities Pay for State Fiscal Cost of Ordinances
Where: Arizona
What: Arizona passed a bill to make cities pay the cost to the state of raising the minimum wage
How: HB 2756 (2019 | AZ) The administrative head of each budget unit, not later than September 1 of each year or at a later date not to exceed thirty days after September 1 if approved by the director of the governor’s office of strategic planning and budgeting, shall submit to the governor, with five copies, estimates of the financial requirements and of receipts, including appropriated and nonappropriated monies in no less detail than the state general fund, of the budget unit for the next fiscal year. THE ESTIMATES SHALL INCLUDE A DETAILED ESTIMATE OF THE COST TO THE BUDGET UNIT IN THE NEXT FISCAL YEAR ATTRIBUTABLE TO A COUNTY’S, CITY’S OR TOWN’S ESTABLISHMENT OF A MINIMUM WAGE IF THAT MINIMUM WAGE EXCEEDS THE MINIMUM WAGE ESTABLISHED BY THIS STATE PURSUANT TO SECTION 23-363. The estimates shall be on the forms and in the manner prescribed by the governor with explanatory data that may be required, together with additional information the head of the budget unit desires to submit. The estimates submitted shall bear the approval of the administrative head of the budget unit.
Arizona Repulic | New law would make Arizona cities pay for raising the minimum wage
Education Savings Accounts. By the Numbers.
Where: Arizona
Who studied the numbers? The Goldwater Institute, the impetus for the ESA program
What numbers are the Arizona Education Savings Account reaching?
- 6,423 participating students in 2019,
- up from 5,042 in 2018
- 3,360 in 2017
- 144 in its first year, 2012
- award amount averages $6,148 per pupil in 2019 for non-special needs participants
- $10,120 average cost for an equivalent student in public schools
- over $4.2 million per year in education dollars back will be redirected to other public school pupils
SB 1431 (2017 | AZ) , 2017 statewide expansion of ESAs
Proposition 305 (2018 | AZ) to overturn SN 1431, which failed to pass
KPVI | Study measures success of Arizona’s education savings accounts
School Finance. US Supreme Court review of state constitution obstacle to School Choice
Where are the roots of this US Supreme Court case? Montana
What happened in Montana?
- Montana’s State Supreme Court voided a law that allows for small tax credits by donating to school scholarship foundations
How many states have similar provisions to Montana’s constitution that voided its law? 37
3 Business Chamber Interim Legislative Goals in Texas
Where: San Antonio TX
Who: San Antonio Chamber of Commerce
What are their legislative goals:
- new funding mechanisms for transportation projects
- aid to our military installations
- workforce development partnerships that promote postsecondary and career readiness
- evaluating the benefits of economic development incentives in attracting capital investments and jobs to Texas
2019 Achievements of Public Pension Legislation
Who is tracking public pension achievements in legislation? National Public Pension Coalition
Where can I find their analysis? NPPC State Coalition Analysis
What achievements is NPPC highlighting in 2019?
- COLAs for the first time in 10+ years in Texas and New Hampshire
- Wyoming and Oklahoma added COLAs to their 2020 legislative agenda
- Colorado eliminated a contribution increase
Local Procurement to Keep Tax Dollars Local.
Where: Beaumont, TX
What: City Council enacting a master list of local contractors that will be emailed when an opportunity to bid on a project arises
Why: Keep local tax dollars with local entities
Who supports this local contractor notification system? Associated General Contractors of Southeast Texas
Beaumont Enterprise | Beaumont takes step to keep tax dollars local
Anatomy of a local pension proposition
Where: Phoenix AZ
What is the proposition? Prop 106 would require additional annual assessment of all of its pension liabilities
What happens if the pension assessment shows less than 90% funding?
- cap on City budget growth for City programs
- does not apply to budgets for police, fire, first responders, and labor contracts executed before January 1, 2018
Who is opposed? Greater Phoenix Chamber
Greater Phoenix Chamber | Prop 106 would be fiscally irresponsible for the City of Phoenix
AZ Central | Prop. 106 balances Phoenix pension debt on kids and seniors. That’s unfair
Pension Task Force Recommendations for Statewide Pension Reform
Where: New Mexico
Who appointed the Pension Task Force? New Mexico Gov. Michelle Lujan Grisham
What recommendations did the task force make?
- increase in contributions
- 3 years of reducing COLAs
- maximum COLA would be set at 3% per year
- With 100% funded pension, increase to 5% per year
- Minimum adjustment of 0.5%
- profit-sharing model to have benefits fluctuate with returns
- eliminate the current earnings cap of 90% to encourage longer employment
Chief Investment Officer | New Mexico Governor Pitches Plan to Bring State Pension to Solvency
Broadband Funding Debate Opens Natural Gas Tax Debate
Where: Pennsylvania
Why did Pennsylvania legislators move from SB 725 (2019 |IN) that funds broadband in rural areas to a natural gas tax?
- Pennsylvania is having challenges funding last mile broadband in rural areas
- the impact fee imposed in Marcellus is not enough
What is Pennsylvania Manufacturers’ Association office saying? ““We agree that Pennsylvania should be more like Texas,” Taylor said. “Texas has no impact fee, it has no corporate net income tax, no personal income tax, it is a right-to-work state. Texas has enacted very meaningful limits on lawsuit use. If the administration is interested in trading those reforms for a severance tax, we think that’s a discussion worth having.””
Indiana Gazette | Broadband hearing reopens debate on gas tax
Local Rules. Cannabis Delivery.
Where: Massachusetts
What agency is promulgating home delivery cannabis rules? Cannabis Control Commission
What were the policy considerations?
- Allow home delivery in communities that have banned marijuana dispensaries?
- Should delivery persons travel in pairs? Should they wear body cameras?
- Should marijuana cafes be options for people who live in non-smoking apartment buildings?
New Researcher Opposes Tax Incentives to Companies
Where: Texas
Who: Professor of Government, University of Texas at Austin
What are the arguments against tax incentives?
- there is a long list of scandals involving economic development programs
- no ROI for taxpayers
- it is a waste of tax dollars, investments would have occurred anyway in 75% to 98% of the cases
- cause harm to local governments and state coffers
Cannabis Policy Strategy lesson
Where: Utah
What: Utah voters approved medical marijuana in November 2018
Immediately after the law was effective, the Governor calls a special session and the Legislature overturns the voter approved law.
Utah’s highest court upholds the ability of the Legislature to overturn a voter approved referendum.
Courthouse News | Utah High Court OKs Legislative Gut of Voter-Approved Pot Law
Small Business Sues over uncollected Amazon sales taxes.
Where: California
What is this lawsuit about? By failing to collect adequate sales taxes from Amazon the state’s tax collectors gave Amazon an unfair competitive advantage and failed to fulfill its duty to the state
Anatomy of a Cannabis Coalition
Where: California
The Cannabis coalition: state advocates teaming with local (city & county) advocates
Why? Cannabis regulation and taxation is local level in California and is a legal patchwork
Cannabis Legislation. Drafting Error in the Sunshine State
Where: Florida
What drafting occurred in the Florida decriminalization bill? the bill did not remove all criminal punishments and retained a reference to misdemeanor offenses
The bill: HB 25 (2019-2020 | FL)
Marijuana Moment | Florida Lawmaker Files Bill To Decriminalize Marijuana
New Eco Devo Tool for funding Creative Communities.
Where: Austin TX
What: Electronic tipping of musicians and artists via Dipjar for digital tips
How: Pilot program launches Summer 2019 with artists applying to participate
City Impact Fees. Shifting the Burden from Ratepayers & Property Taxpayers
Where are impact fees being considered? Waco TX
What factors contributed to impact fee discussion?
- economic growth
- population growth
What are impact fees?
- onetime charge
- imposed on new development
- funding infrastructure such as roads, water & sewer lines required to serve the new development
How does this shift a burden from rate payers and taxpayers?
- Downtown and long established residents aren’t footing the bill for new development infrastructure
- Its a work around property tax revenue limitations
- Those who are paying the impact fee, benefit directly from the fee
Waco Tribune-Herald Editorial | EDITORIAL: Impact fees overdue amid vigor of local growth
Industry Tax Swap. Less Oil Tax. More Tech Tax.
Where: Mexico
Which industry will be paying less tax revenue? oil and gas via PEMEX
Which industries will Mexico add to an existing tax?
- Amazon
- Uber
- AirBnB
- digital platforms
- ecommerce
How are they talking about it? It isn’t a new tax, it is expanding the tax base
Reuters | Mexico to adjust tax framework to realities of digital economy
Fintech + Sandbox = State Open to Cannabis Bitcoin
Where: Arizona
What: Arizona Attorney General oversees a fintech sandbox
Texans, why does this sound familiar? A much discussed bill was filed by Sen. Paxton to create a finch sandbox at the Attorney General’s Office. The bill did not advance, at all.
Who is behind the cannabis bitcoin?
- ALTA (www.whatisalta.com)
- an Arizona startup
Why a sandbox solution? to solve the banking issue of cash intensive cannabis industry
Arizona Attorney General | Arizona Attorney General’s Office Accepts ALTA into FinTech Sandbox
Anatomy of a local cannabis tax ballot
Where: Stanton CA
What is the marijuana tax on the ballot?
- $12/sq.ft. tax on marijuana and industrial hemp cultivation facilities for canopy space
- 6% gross receipts tax on dispensaries and weed delivery services
Estimated annual tax revenue: $1 million to $1.4 million annually
City is dedicating revenue to: public safety, road repair and other service
Voice of Orange County | Stanton Residents Will Vote on Marijuana Tax Nov. 5
Lege Increases Transparency of Cannabis Applicants
Where: Nevada
What: SB 32 (2019 | NV)
Why did this happen? A court is looking into the agency head who approves applications and the close relationship with cannabis industry, including removing issues from applications
What did the bill do? Clarifies that disciplinary actions and law enforcement records for cannabis applicants are not confidential and privileged under state law
TX A.G. Opinion. How to Repeal a Road Tax
The opinion request: RQ-0298-KP
Who is requesting the opinion? Goliad County Attorney
What tax are they seeking instructions on to repeal? a special road tax approved by voters in the early 1900s
What issues are lurking about?
- Does the vote to repeal the special road tax have to follow Transportation Code §256.053?
- If yes, can” 50% plus one of the registered voters that sign the petition requesting the commissioners court to call for an election to repeal the special road tax, be satisfactory proof to the commissioners court ?”
Reason Why State Pension Costs Rapidly Grew
Where: California
What was the rate of growth of California pension costs?
- from 2007 to 2016 the increase was up $7,022 per employee
- national median increase of $1,216
- California cost increase was 6 times the nations
How did this happen?
- correlation between pension cost increases & unions/collective bargaining
- cities with 50% union membership saw 4times the cost increase
Funding for this researcher’s study provided by
- Laura and John Arnold Foundation
- Berkeley Institute for the Future of Young Americans
- Institute for Research on Labor and Employment
Sacramento Bee | Local Pension Costs Grew in California at Nearly Six Times National Rate
STATE FUND INVESTMENT TREND. Cannabis investments.
Where: Tennessee, Texas, & Alaska
What: invest funds in Innovative Industrial Properties, that will operate in Illinois where recreational marijuana becomes legal Jan. 1
Other pension investments in cannabis?
- New York State Common Retirement Fund.
- Arizona State Retirement System.
- California State Teachers Retirement System.
- California Public Employees Retirement System.
- Public Employees Retirement System of Ohio.
- New York State Teachers Retirement System.
- Oregon Public Employees Retirement Fund.
- State Board of Administration of Florida Retirement System.
- Louisiana State Employees Retirement System.
- Commonwealth of Pennsylvania Public Schools Employees Retirement System.
- Teachers Retirement System of the State of Kentucky.
- Municipal Employees’ Retirement System of Michigan.
- State Teacher Retirement System of Ohio.
- Public Sector Pension Investment Board — Canada.
Regulatory TREND. Tax Incentives for Modular Homes.
Where: Colorado
What regulator? Colorado Economic Development Commission
What policy concerns are addressed by the tax incentive ? need for additional affordable housing
What is the tax incentive look like? economic development funds and incentives to manufacture modular housing and hire unskilled and disadvantaged workers in Colorado
TX State Auditor. State Contracting System.
The audit: SAO 19-042
What part of state contracting does this concern?
- Vendor Performance Tracking System
- at the Office of the Comptroller of Public Accounts
- Use by the Texas Workforce Commission & Parks and Wildlife Department
What are the 2 takeaways important to procurement?
- more scrutiny on the data submitted by contractors to verify accuracy
- greater reliance on the reported data by the agencies prior to contract approval
TX Attorney General Opinion. Tax Revenue and Chambers of Commerce.
What question will Opinion Request 0296-KP answer?
Can a city council provide tax revenue to improve a Chamber of Commerce Facility not owned or operated by the city?
Where: City of Big Lake, Texas
What happened? City Council spent $65,000 to repair the Chamber facilities, not owned or operated by the city, and received a complaint
If I’m drafting bills for 2021 what do I need to watch for? Clarifying Tax Code Section 351.l0l(a)(l) that visitor center includes Chamber of Commerce facilities
And yes, you should be drafting 2021 bills now.
New Research. 3 Reasons to Remain Calm over Pension Unfunded Liabilities.
Who conducted the research? Federal Reserve Board, Bank of England, & the Brookings Institute
What are 3 reasons it found to not panic over unfunded pension liabilities?
- fully funding pensions is not necessarily right, it’s just assumed to be the right thing
- pension debt is stable if its size relative to the economy doesn’t increase
- analysis of pensions should be from a “public finance [and sustainability] angle” which would not find a crisis
Governing | What Crisis? The Case for Not Panicking Over Pension Debt.
Anatomy of a Cannabis Banking Bill
Where: Congress’ SAFE Banking Act HR 1595 (116th Congress)
What sparked the legislation? Federal law and some state banking laws prevent providing banking services to the cannabis industry
Why is the legislation good for states and cities? It is estimated that cannabis taxes are underpaid by 20%
Why is this good for the economy?
- without banking options, the industry has no start ups
- without banking options, it is cost prohibitive to enter the industry
Governing | Support Grows for Marijuana Banking Bill in Congress
2 Red States Limiting Corporate Tax Incentives. 3 Reasons Why.
Where is this happening? Missouri & Kansas
What limits are they putting on tax incentives for corporations?
- In lieu of tax incentives for corporations
- The money is being put into development by the local government
Why? Is this something unique to these two states? Yes, Kansas City two state geography created a stalemate so the states wouldn’t take companies back and forth across the state line.
NY Times | Editorial | Can States Just Say No to Corporate Giveaways?
TX Attorney General Opinion Tax Abatements. 3 Key Points
What question is KP-0261 answering? Are there limits on economic development funds under subsection 381.004(h) LGC programs?
Are there limits on these economic development funds?
- No, the limits of 381.004(g) do NOT apply to (h)
- BUT there are constitutional parameters
- Generally, the Commissioners Court gets to set the term for the funds
What made the requestor think there were limits? Limitations in 381.004(g)
Pension Funding TRENDs.
| The lowest pension funding: Kentucky (34%)New Jersey (49%)Illinois (38%)Colorado and Connecticut (47%) |
| The highest pension funding:Wisconsin (103%)South Dakota (100%)Tennessee (97%)New York (95%)Idaho (91%) |
Tax Foundation | How Well-Funded are Pension Plans in Your State?
Lege TREND. Decriminalizing State Banking of Cannabis Proceeds.
Where: Illinois
What: SB 2023 (2019 |IL)
How is Illinois tackling the cannabis industry banking issue?
- Prohibiting state regulators from penalizing state banks for working with the industry
- Prohibiting state regulators from discouraging banks from working with the industry
Which state official pushed the legislation? The Illinois State Treasurer
Governing | How Nevada Plans to Solve the Marijuana Banking Problem
Lege TREND. 3 Lessons from Cannabis Legalization Unintended Consequences
Where: Oregon
What 3 lessons can be learned from Oregon’s legalization?
- SURPLUS PRODUCT SALES. What can producers do with it? Can it be transferred out of state?
- SURPLUS PRODUCT LIMITATIONS. Oregon found it had product on shelves to supply sales levels for 6 years. What state controls can be placed on production?
- WHICH AGENCY OVERSEES IT? In Oregon the Oregon Liquor Control Commission oversees cannabis industry
How did Washington and Colorado handle surplus?
- Limit the production licenses people can hold
- Limit. the number of plants businesses can grow
How did Oregon adapt to control for surplus? Passed legislation to allow regulators to stop issuing new production licenses when supply > demand
What key for lawmakers/regulators to know? The existing, illegal, production levels. Oregon found a lot of illegal operators adapted to the legal market
Stateline | Enough Marijuana for 6 Years: Oregon’s Cautionary Tale for Other States
Legal TREND. Reigning in Delegating Rule making to Agencies
Legal types are talking about the US Supreme Court’s ruling this term in Gundy as an act by the Court to reign in the delegation of rule making authority to agencies.
Look for the argument in a State House near you.
The New Yorker | The Supreme Court Is One Vote Away from Changing How the U.S. Is Governed
Lege TREND. Soda Tax Becomes Warning Label. Still Fails, Anatomy of a dying legislation
Where? California
The bill? SB 347 (2019 | CA)
Why did it fail?
- Strong opposition from this coalition:
- soda industry
- California Restaurant Assn.
- California Grocers Assn.
- California Chamber of Commerce
- The bill is too narrow and doesn’t touch syrupy coffee drinks or other drinks containing sugars
LA Times | California bill requiring warning labels on sodas, sugary drinks is shelved
State Government + Local Contracts = Bans with Certain Corporations announced by Tweet
Where: Arizona
The potential state contract ban: NIKE
How is this going to work? The Governor wants to stop economic development deal made by a city for a Nike facility
Why is this happening? Nike withdrew a shoe at the request of former NFL quarterback Colin Kaepernick
The tweet that started it: “Nike has made its decision, and now we’re making ours. I’ve ordered the Arizona Commerce Authority to withdraw all financial incentive dollars under their discretion that the state was providing for the company to locate here,” Ducey, a Republican, wrote in a series of 3 a.m. tweets Tuesday.
Governing | Arizona’s Governor Wants to Cancel a City’s Contract With Nike. Can He Do That?
+1 Local Government Travel Bans
Where: Long Breach CA
What travel ban? Prohibiting taxpayer funded travel to Alabama and Georgia due to abortion restrictions
Is Long Beach alone? No, similar travel bans are also in the works by Los Angeles, the State of Colorado and the State of Maryland
AL.COM | Another California city looks to ban travel to Alabama over abortion law
Attorney General Opinion. Texas TDHCA
Where: Texas
What question will the Texas Attorney General Answer?
- Did TDHCA follow requisite statutes when awarding the 2019 Competitive (9%) Housing Tax Credit Application Cycle?
What’s really going on here?
- 2 Region 11 Urban applications violated TDHCAs 1000 foot rule
- TDHCA accepted these 2 appeals
- By accepting these appeals, did the agency violate the time requirements to file an appeal?
- Does the appeal deadline clock start when the Application Log goes public on the TDHCA website?
- Does the appeal deadline clock start when the list serve information is sent?
Local TREND. City Councils Banning Chemicals
Where: Key West
What is being banned? RoundUp weed killer & anyt herbicides that contain glyphosate
Why? A $2 Billion lawsuit that has found the weed killer to be a carcinogen
CBS 4 Miami | Key West Bans Weed Killer In Wake Of Costly Cancer Lawsuit
Local TREND. Stadium Building. District Attorney Declares Council Action Violated State Law
Where: Ingelwood, CA
The stadium: L.A. Clippers Arena
What was Council’s violation? The meting notice did not provide sufficient notice of what was to be discussed
What should have been described? Any information of the location and scope of the contemplated development project
The impact: Courts could rule the counsil action null and void
Los Angeles Times | Inglewood meeting to approve Clippers deal violated state law, D.A. says
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