Topics
Finance & Revenue
Finance & Revenue
COVID Effect. +2 States Retain Alcohol Sales to go. Alcohol Delivered.
What’s happening? Alabama S126 (AL- 2021) and Texas are both seeing alcohol to go sales moving through their legislative chambers.
Why is this important? The pandemic led Governors to loosen certain regulatory restrictions, which created a pilot program of sorts to test how will the state operate if we loosen these rules. Turns out, it will be A-OK. So now those looser rules are getting codified.
How will this be important? The new economy will continue to be a reassessment of the old rules. Just because we always did it that way, doesn’t mean that way was the right way.
AL.com | Alabama alcohol delivery bill awaits Kay Ivey’s signature
Collecting a Vehicle Fee to Build Charging Stations
What’s happening? Florida Senate is moving SB138 (2021 | FL) that will use it’s $135 EV fee to create the Electric Vehicle Infrastructure Grant Program to help pay to install the charging stations.
Why is this important? The bill has an economic development component for the EV infrastructure building and will split funds between the Florida Department of Transportation and local governments, with counties getting 36% to make up for lost gas tax revenue.
How will this be important? Building out EV charging station infrastructure is big business. “This is going to create a very large industry,” said Sen. Tom Wright, R-New Smyrna Beach.
Colorado’s Proposed Insurance Premium Fee for Disasters
What’s happening? Colorado is considering the Natural Disaster Mitigation Enterprise, HB21-1208 (2021 | Co) that would add a $1.25 per every $1,000 in premiums to create the state-run natural disaster mitigation enterprise fund that would help communities finance necessary work to lessen or prevent future catastrophes.
Why is this important? Mitigating disasters is big talk and big work in state legislatures.
How will this be important? The pacing of “disasters” seems to be increasing.
Data will reclassify your city. Bye, bye funding.
What’s happening? The Office of Management and Budget is set to reclassify the size requirements for Metropolitan Statistical Areas. In 1950s when they came up with the size of MSAs, the low end was 50,000. Times changed. There’s a lot more people in the US. Now, they want to change the MSA designation to 100,000 population for core cities.
Why is this important? MSA stays determines federal funding. If you lose your MSA status, you lose the funding access.
How will this be important? It will hit 6 cities in TX, 5 in CA and 9 in PA, among scores of others.
AP | Lawmakers fear turning 144 cities into “micropolitan” areas
Infrastructure Building. What matters as much as cost & time?
What’s happening? Governing Column looks at what is important when governments build infrastructure. Turns out it isn’t just time and money. It’s also who owns the infrastructure, what it looks like (design matters) and connections.
Why is this important? Because often the choice is which costs the least, but in the end the project can cost more if it’s an eye sore, serves no purpose because it doesn’t connect people and communities, or is run by a 3rd party.
Why will this be important? Public Private Ownership is a perennial policy decision and works well with good actors. But, when the public turns on a project managed by a bad actor, its a costly policy problem.
Governing | What Are the Five Principles of Good Infrastructure?
How are small towns in MI increasing their tax revenue? Marijuana sales.
What’s happening? Michigan legalized cannabis more than a year ago. mall cities are reaping the revenue benefits without raising existing taxes.
Why is this important? Cities benefit from license fees and tax revenue from marijuana with no impact to law enforcement activity or budgets.
How will this be important? When cities have little ability to rate taxes, new taxes provide a key revenue source.
Fox 17 | Small towns getting thousands of dollars in tax revenue thanks to marijuana sales
Sports Betting Revenue. 4th State Breaks $500M/Month
What’s happening? Illinois became the 4th state to take in more than $500 million in sports bets in a single month. Illinois came close to $600M for January.
Why is this important? Operator revenue (jobs) in January was $49.4 million. $7.2 million in taxes for the state. 39.5% of the state’s total handle came from basketball betting.
How will this be important? Not every state has legalized sports betting and as more states top $500 million in revenue for a month, the revenue numbers are enticing.
YogoNet & PlayIllinois | Illinois breaks sports betting revenue and handle records in January
Legislative Procedure. Can you Speed Read?
What’s happening? Co courts blocked an end run around filibuster-ish rules. In the CO a member can force the reading of a bill in its entirety to take up time. Well, to be clever, and thinking that they found a loophole, the legislative leaders opted for speed reading by computer. The CO Supreme Court said- no, speed reading does not comply with the constitutional requirements.
How is this important? These tactics and court cases, led to the two parties to work together to find common ground. Statesmanship lived.
Why will this be important? CO courts may not have liked it, but maybe Texas courts thinks, yeah, that works.
AP | Colorado court: Speed-reading bills violates constitution
Digital Ad Taxes
What’s happening? Overriding a veto, Maryland is the first state to tax digital advertising. Now, Big Tech is suing to stop the bill.
Why is this important? There’s big money involved. The MD bill will generate revenue like this:
- 2.5% for companies with global annual gross revenues of $100 million through $1 billion
- 5% for companies with global annual gross incomes greater than $1 billion through $5 billion
- 7.5% for companies with global annual gross revenues greater than $5 billion through $15 billion
- 10% for companies with global annual gross revenues exceeding $15 billion
How will this be important? Revenue source. New revenue source. New revenue source. It’s like a money tree for elected officials. Opponents say it violates the Commerce Clause and is discriminatory.
Government Tech | Maryland’s Digital Ad Tax Under Pressure from Big Tech
How will Local Governments Spend CARES funding?
What’s happening? State and local governments will get an extra W$350 billion, with $65.1 billion in direct federal aid for counties & an additional $1.5 billion for public land counties.
Why is this important? There are Dos and Don’t on spending. Do: health safety measures and PPE demands; payroll, vaccine distribution, small business needs, food, education, broadband Do not: bridge repairs
How will this be important? The feds are watching & will react if spending proposal is outside of COVD recovery.
Governing | Local Govs Will Spend Stimulus Relief in Different Ways
How to Pass Cannabis Legalization in the State Budget.
What’s happening? The Governor of Rhode Island is placing legalization in the state budget bill.
Why is this important? The Governor lays out his entire regulatory frame work. 25 marijuana retailers to be licensed each year. Licenses awarded on a lottery system, except 5 licenses are reserved for minority owned businesses. 17% sales tax rate on cannabis sales.
How will this be important? The Governor goes further to divvy up the revenue with 60% going to the state general fund, 25% would cover administrative costs and the remaining 15 percent would go to local governments.
Which Southern State Will be the 1st to Legalize Cannabis?
What’s happening? Virginia is poised to legalize cannabis, or this clever article points out, “Virginia is close to becoming the first Southern state to get a tax revenue high.”
Why is this important? The estimated revenue for legalized cannabis in Virginia is $698 million to $1.2 billion annually in economic activity and up to $274 million in tax revenue per year.
How will this be important? Virginia got to this point after the Governor created a commission to estimate the revenue potential. 12 states are currently considering some kind of cannabis reform legislation. States like New York, Connecticut, New Mexico and Hawaii could soon see legislation on governors’ desks.
Why businesspeople want sports betting in Texas.
What is happening? Texas businessperson, Mattress Mack, wrote an opinion piece about his proclivity to place sports bets, in states where it is legal. He pays taxes for those bets to those states. He wants to pay texas to Texas.
Why is this important? he supports sports betting legislation, like we’ve seen in other states, that has voter approval as step 1. For Texas, that will look like, HB 2070 /HJR 97, SB 736 /SJR 39 (2021 | TX)
How will this be important? Gambling in Texas has been decades long pursuit. It’s like when the “will they? won’t they?” moment of a romcom drags on for years and years.
Houston Chronicle | Mattress Mack: It’s time for the Texas Legislature to legalize sports betting
What is the jock tax?
What’s happening? Athletes who are paid to compete in states, pay taxes for money earned competing in each of those states.
Why is this important? Only 4 jurisdictions have no jock tax. Florida, Texas, Washington and Washington, D.C
How will this be important? States are looking for revenue & everyone else is doing it.
1st State to Legalize Sports Betting in 2021
What’s happening? South Dakota became the first state to pass sports betting in 2021 with the passage of SB 44 (2021 | SD) that allows for sports betting in Deadwood SD.
Why is this important? South Dakota is surrounded by states that have legalized sports betting, and voters approved it in November 2020.
How will this be important? The preemptive voter approval method used in South Dakota has been seen elsewhere like Louisiana. it works.
Sports Handle | South Dakota Lawmakers Send Sports Betting To Governor
Tribes and Sports Betting Agreement.
What’s happening? Massachusetts has reached an agreement with a tribe, the Mohegans. Their agreement:
- Sports betting revenue will be taxed at 13.75%. iGaming will be taxed at 20%.
- The Lottery can operate 15 retail sports betting locations as well as one online skin. There will also be new Lottery-run sports betting venues in Bridgeport and Hartford.
- The Lottery can sub-license some of those operations to Sportech, but Sportech will not get operations or an online skin of its own.
Why is this important? The Governor is negotiating with tribes before the state has legalized sports betting and iGaming.
How will this be important? All eyes are curios to see if reaching an agreement with the tribes makes legislation as easier task.
Legal Sports Report | MOHEGAN, CONNECTICUT GOV. LAMONT REACH SPORTS BETTING AGREEMENT
Did Texas Winter Storm Hamper Economic Development?
What’s happening? RoundRock, TX Economic Development CEO says all the ingredients that made Texas economically attractive to business still exist. However, the true measure will be how government reforms the problems that were highlighted by the storm.
Why is this important? This is man issue pitting what is viewed as pragmatic business that wants certainty against policymakers who may prefer to blame over solve.
How will this be important? The response by policymakers will foreshadow how they handle other top tier issues (to solve or to blame?)
State Limiting Economic Development by Industry.
What’s happening? Iowa legislature is considering Senate File 402 (2021 | IA) that would prohibit economic development funds to tech companies that have been found, by a court, to have violated free speech.
Why is this important? “The conservatives are being censored by tech! The conservatives are being censored by tech!” That’s the policy mantra by the Iowa Republicans, the accuracy of which we’re not touching with a 10 foot pole connected to the Mars Rover. What Big Tech is saying is:
- don’t weaponize economic development
- the proposed bill “perversely creates an incentive” for private entities not to prohibit or remove objectionable content in order to keep tax incentives
How will this be important? We can’t discount legislatures passing unconstitutional laws. We also can’t discount the ability for the voting public to agree with this legislation, which places restrictions on the free market and business operations.
Governing | Iowa’s Bill Against Big Tech Risks Economic Development
New Pension Transparency Tool.
What’s happening? A new transparency benchmark for pension systems has been created. Meet the new Global Pension Transparency Benchmark.
Why is this important? This benchmark focuses on the transparency and quality of public disclosures, with quality relating to the completeness, clarity, information value, and comparability of disclosures.
How will this be important? Disclosing information in common terms is important. These experts point to CALPERS executive summary that’s easy to read and Quebecois pension fund Caisse de dépôt et placement du Québec puts easy to read updates on its website. Communication is key.
CIO | New Pension Transparency Gauge Finds Serious Improvement Is Needed
Local Budgeting TREND: Equity Budgeting. BLM.
What’s happening? Public Affairs schools are talking about cities taking into account historical inquiries in local budgeting.
Why is this important? In making budget decisions, local budget decision makers are taking the needs of previously disenfranchised members of the population into account when allocating dollars for the next fiscal year. Lousiville, KY is doing this. Austin, TX has a Chief Equity Officer as does Fairfax County, Virginia.
How will this be important? The lessons of 2020 aren’t disappearing. The impact of systemic racism that Black Lives Matters highlights has made local government officials look at their actions from the taking of their property in redevelopment to inadequate budgeting.
Route Fifty | Equity Budgeting in Cities: Directing Dollars Where They’re Needed Most
Post COVID Legislation for Legislature Functions
What’s happening ? California Legislature is gearing up for a post-COVID world by ensuring that virtual components to legislative and regulatory hearings continues. AB 339 (2021 | CA)
Why is this important? New Normal is getting codified. Virtual participation in hearings offers to level the playing field for all citizens who want to be part of the process.
How will this be important? Virtual hearings allows for closed caption options and language services bringing access to the process to more people. From those in need of services, to people who work, to those with small children. + Its being used as justification for broadband into rural areas.
San Jose Mercury News | California Might Make Virtual Meetings a Permanent Option
Anatomy of a Digital Tax Bill
What’s happening? Maryland Legislature passed a digital ad bill, HB732 (2021 | MD), imposes a 10 cent tax on digital ads played in MD and targets companies that make more than $100 million a year selling digital advertising
Why is this important? The Republican Governor vetoed it. The Legislature overrode the veto. The opposition group is the Internet Association — a trade group representing Amazon, Facebook, Google.
How is this important? The messaging of this opposition is that we need digital ads because they allow small businesses and startups to easily and affordably access new consumers.
CNN Business | Targeting Big Tech, Maryland becomes first state to tax digital advertising
The Allies in Arizona’s Sports Betting Bill
What’s the deal? Arizona is considering a comprehensive sports betting, race track Keno, online fantasy sports bill. The total revenue estimate per year is $42 M, with an 8% tax on new non-tribal gambling profit, which will go to the general fund. Money from a maximum 8% tax on tribal gaming profits goes to special state accounts and local governments.
Why is this important? Red Arizona is a roadmap of a diverse coalition: Tribes, Race Tracks, Professional Sports, but not on board is the Arizona Licensed Beverage Association which says restaurants and bars want a seat at the table to make up pandemic revenue hits.
How will this be important? The robustness of the coalition and the potential to bring the restaurants and bars on board expands your support base.
AP via Lincoln Star Journal | Arizona House panel advances bill allowing sports betting
Louisiana 3 Step Approach to Sports Betting
What’s the deal? Louisiana Legislature passed legalized sports betting, but required parishes to vote to approve it. The November 2020 election had 55 of the 64 parishes voting in favor of sports betting. Now the 2021 Legislature is creating the rules for sports betting. Last year the Gaming board approved a 8% tax ons ports betting.
Why is this important? Other states are grappling with the mode and method to approve sports betting in their state.
How will this be important? A legislator doesn’t vote directly for sports betting, the legislator votes to all the voters to approve sports betting. There are still unanswered questions for the 2021 Legislature, such as will there be online sports betting? Will bets only be placed at casinos?
Utah Created a Business Sandbox. Who wants to play?
What’s the deal? The Utah legislature created a business sandbox. This is just a weird and fancy way of saying the state will “create a pathway for innovators to get a temporary reprieve from standing state rules that could impede or prevent a new idea from getting a real-world tryout.” HB 217 (2021 | UT)
Why is this important? All states are trying to figure out how to get the next big innovator to call their state home. The jargon answer- a regulatory sandbox to let business play. Maybe their experiences in sand boxes were better than mine, because I’m pretty sure other kids in the sandbox were bullies.
How will this be important? Eventually state will get it right and find that magic combo to lure innovation.
Why is OR reversing Timber Tax Cuts?
What’s the deal? Oregon is reversing course on its timber tax cut.
Why should we care about this? Know any organization that represents an industry to keep an industry benefit in place? States and cities are looking for revenue, and protectionist programs are in their vision among others. It gets better. Funding was also provided for state-funded Oregon Forest Resources Institute, annual budget of $4 million, worked to discredit climate research deemed harmful to the timber industry and appeared to skirt legal constraints against lobbying.
How can this impact me? A ProPublica investigation revealed that timber interests have benefited from tax cuts that cost counties at least $3 billion over the past three decades. Add in the research from the Forest Resources Institute.. Lots of fingers in lots of pots
Reaction to Cities Adopting Hero Pay
What’s the deal? Cities are passing ordinances to pay essential workers, front line workers, grocery store workers more during the pandemic. In response, 2 grocer associations, Northwest Grocery Association and the Washington Food Industry Association, have sued Seattle for its hero pay.
Why should we care? Economists point to other grocers, like Trader Joes and Costco, that implement hero pay on their own and display it, are making a profit. Its an industry split- one side saying hey we’ve got this, we’re here for our employees; and the other side saying we can’t afford city mandated hero pay.
How can this impact me? In California, some grocers are closing rather than pay supplemental pandemic rates to employees. part of the opposition argument is that all essential employees should get this bump in pay, not just grocer employees.
Route Fifty | Grocery Groups Sue Over Mandated Hazard Pay for Workers
Anatomy of Cocktail Delivery Legislation
What’s the deal? Since the pandemic, Ohio and Iowa have made cocktails to-go & cocktail delivery permanent. This means restaurants and bars have access to delivery of their high profit margin items.
Why should we care? 13 other states are following suit. Delaware, Florida, Kansas, Kentucky, Maryland, Missouri, Nebraska, New Hampshire, New Jersey, New York, Oregon, Texas and Virginia.
How could this impact me? It’s the brain child of Hospitality Recovery Coalition. The Coalition includes Distilled Spirits Council of the United States (DISCUS) in partnership with the American Distilled Spirits Alliance (ADSA), the Council of State Restaurant Associations (CSRA), the National Restaurant Association and TIPS. Alphabet Soup most of us know.
Distilled Spirits Council | Cocktails To-Go Legislation Filed in 13 States, More Expected in Effort to Help Struggling Hospitality Businesses
Governing | A Chance to Liberate Booze Delivery — if Government Allows It
First Seattle, now Los Angles. Hero Pay.
What’s the deal? Cities are requiring increased pay for essential workers during the pandemic.
Why should we care? Big chains are pushing back from adding $5/hr to their employees. Other chains, like Trader Joes, filed all pay by Seattle’s $4/hr to thank its workers.
How can this impact me? We’re watching the economic experiment. How if you treat your workers well, you’ll increase your profits. The numbers show it, the thinkers believe in it, and its a cornerstone of the new stakeholder economy.
Calls to Cut Economic Development.
What’s the deal? Texans for Fiscal Responsibility have their perennial request to end the state’s economic development programs and substitute in tax cuts.
Why should we care? Because “corporate subsidies” and “crony capitalism” are phrases that ring true with populist leaning crowds or on Tuesday’s then Orion and Jupiter are in alignment. Not to throw in corporate double talk, but you never know when this sticks, but when it does stick at 10pm on a Tuesday in May, it will stick hard and fast like bubble gum under a diner’s table.
How can this impact me? Even a stopped clock is correct twice a day. Knowledge is power, and knowing this keeps you from being blindsided.
Economic Development Meet “Inclusive” “Diverse” “Resilient”. Star Date 2021.
What’s the deal? The pandemic changed the world. We know this. So, let’s accept it like the earth is round. It’s still ok to believe the earth is round, right? The move toward corporate social responsibility that began in the summer of 2018 by the Business Roundtable and accelerated with the 2020 pandemic is in full gear ahead for 2021 when economic develop deals will require diversity and inclusivity.
Why should we care? There’s a push to use words like resilience which has long been held to climate impact, weather events, or the capacity to deliver utilities. Now, with remote working and the after effects of 2020, resilience means economic resilience too.
How can this impact me? A University of Texas professor is talking about how cities, businesses and anchor institutions should consider the “good jobs strategy” developed by Zeynep Ton at MIT. Know who uses this strategy? H-E-B, Costco and Trader Joes, in which low-paid service jobs are re-envisioned as viable careers to the benefit of both employees and employers.
Route Fifty | Toward a More Inclusive and Resilient Economic Development Paradigm
Emerging Business Issue: PPP + State COVID Fines
What’s the deal? The federal government administered several rounds of PPP forgivable loan funding for businesses, and all the while some of the businesses that received PPP funding were also find by state enforcement agencies for violating COVID protocols.
Why should we care? Clawing back funding from a bad actor is catnip for politics. Its got the classic elements of someone who did something wrong, a righteous truth seeker, and recovering funds for the state. It is a trifecta of catnip delight.
How can this impact me? You never know when your partners, clients or potential clients or partners end up in this quagmire. Some creative lawmaker will find a way to apply a tax or fee to these businesses.
Governing | Millions Flow to Oregon Firms Cited for COVID Violations
Republican Representative : Divest State from Tech
What’s the deal? I have no idea what’s in the water in Florida but its producing a number of ways state elected officials can punish tech companies for twitter banning Trump. Up on deck next: Republican Florida State Rep. Randy Fine and State Sen. Joe Gruters are calling on the state to divest “the $8 billion the state has invested in Twitter, Apple, Facebook and Google through the Florida Retirement System, which pays retirees with proceeds from the investments.”
Why should we care? Pensions divesting from the controversy du jour is an ordinary Tuesday in some states. Is it an effective tool? Or, will it come back to bite you like vampire?
How does this impact me? Chalk this up to a need for all industries to be proactive before they end up on the divestment circuit too.
Governing | DeSantis: Penalize Social Media That Blocks Politicians
Local Pay Requirements for Essential Workers
What’s the deal? Seattle City Council unanimously approved additional $4 per hour for grocery workers during the declared pandemic.
Why should we care? Minimum wage legislation both state and local are all the rage. One even passed statewide in Florida with voter approval with a a Republican businessman supporting it.
Why does this matter to me? How essential workers are being defined is impacting everything from pay to hazard pay to vaccines and more.
What does sports betting revenue look like nationally?
What’s the deal? American Gaming Association supports stimulus for tourism, meetings and conventions plus temporary liability protections from pandemic related lawsuits.
Why should we care? In the midst of this, the AGA also talks about sports better than is more than $21 Billion in gross wagers and $210 million in state and local tax revenue.
Why does this matter to me? 25 states have legalized sports bettering, most of the remainder are considering it.
AP | Virus aid, no new taxes top US gambling industry 2021 goals
What does sports betting revenue look like for a state? not estimates but actual revenue.
What’s the deal? Legalized sports betting has happened for 2 months in Tennessee. 2 months garnered $312.3 million in gross wagers and $5.4 million in taxes.
Why should we care? States are looking for revenue. Estimates in Tennessee say annual revenue from online sports betting should reach $50 million.
Why does this matter to me? States are expanding sports betting and fantasy sports. Casino enterprises are gobbling up fantasy sports operations.
AP via Galveston County Daily News | Tennessee sports betting tax revenue hits $5.4M in 2 months
Pensions Flex Power
What’s the deal? Pensions, representing $1 Trillion in assets, have asked investors, BlackRock, to disclose political activities because of the Jan. 6th criminal acts at the U.S. Capitol. BlackRock gave $85,000 to 15 legislators who deny the results of the 2020 presidential election after the invasion of the US Capitol.
Why should we care? Public pensions have been impacting ESG, divesting from assets that link to fossil fuel or bad actors, and now want more transparency in political activities from asset managers. The pensions say pausing political contributions to these politicians isn’t enough.
Why does this matter to me? Represent someone or some entity? Being a bad actor or seeming to support these bad actors does not align with the new economy. It is bad for investors when officials have rhetoric that destabilizes democracy. People are watching if you’re a bully who rocks the boat.
State Legislatures. Demotions for Supporting Overturning Presidential Election.
What’s the deal? Every action has an equal and opposite reaction. Republican state legislators who supported overturning the Presidential election are facing that equal and opposite reaction.
Why should we care? Chairman are losing their power. Corporations are cutting contributions. Pensions are demanding disclosures for political activities from investment firms related to legislators who supported overturning the Presidential Election.
Why does this matter to me? If you’re in Georgia, 3 Senate Chairmen lost their top spots, an Oregon state rep lost all his committee assignments, and Minnesota passed a resolution condemning it. That’s the start. More to come.
Governing | Beyond Impeachment: Election Recriminations Continue Among Legislators
+Texas to Sports Betting Legislation
The sports: College and professional sports can be wagered
The license fee: $250,000
How many sports betting operations could operate in Texas? 5
Taxes:
- 6.25% per bet
The legislation : HB 1121 (2021 | TX )
+1 State Lege Taking Up Fantasy Sports
Wyoming’s SF 56 (2021 | WY) will pick back up with legalizing fantasy sports.
1 year ago, Wymoning legalized VLTs (video lottery machines).
What would the tax structure look like for the VLTs?
- 20% tax rate
- Profits after taxes are 50/50 split between the bars and the gaming companies
Casper Star Tribune | Legislature moves to make legalized gaming permanent in Wyoming
Crypto Currency Funding Pensions?
What’s the background of crypto currency and pensions systems?
- 2018 Berkeley, CA announces a plan tp issue bonds using blockchain, the foundation for cryptocurrency
- Ohio for a while allowed tax payments by bitcoin
- 2 Virginia public pension funds have invested in a blockchain venture empowered to own cryptocurrency
This begs the question, could pension funds be natural depositories to warehouse, re-market and profit from cryptocurrency?
Governing | Could States Cash in on the Cryptocurrency Craze?
Prevailing Exceptions to COVID Liability Protections
States are passing liability protections concerning the transmission of COVID, and 3 exceptions are at the forefront:
- Gross negligence
- Reckless misconduct
- Conduct with an intent “to discriminate based on race, ethnicity, national origin, religion, disability, sexual orientation or gender identity”
Who.What.Why.How. Wealth Taxes.
Who is pushing wealth taxes? “Left wing progressives”
What is a wealth tax? A tax on the market fluctuation of assets like homes, stocks, art
Why? “To curb extreme wealth accumulation and fuel trillions in new public spending by targeting everything that income, property and capital gains taxes miss.”
How many states have proposed a wealth tax? 9 including California and Hawaii
What have the brains said about the wealth tax?
- “wealth tax in some countries seems more efficient to repel [the] rich than to effectively redistribute wealth.” – Alain Trannoy, a French economist
Do some states have constitutional protections from a wealth tax? Yes, New York’s prohibition on taxing intangible property is seen as preventing a wealth tax
Local COVID Transit Funds
The Federal Transit Administration is adding $14 Billion for public transportation systems under the Coronavirus Response and Relief Supplemental Appropriations Act of 2021 (CRRSAA)
How will the funding breakdown?
- $13.27 billion to large and small urban areas
- $678.2 million allocated to rural areas and tribes
- $50 million allocated for the enhanced mobility of seniors and individuals with disabilities
Railway Age | FTA to Allocate $14B in COVID Relief for Public Transportation
Black Lives Matters. +1 City Creating Special Committee.
Add St. Paul, MN to the list of cities to address racial and systemic inequities.
The ordinance would create the St. Paul Recovery Act Community Reparations Commission.
The goals of the Commission will include closing gaps in homeownership, education, employment and health care.
KSTP | St. Paul City Council to consider forming Black reparations commission
COVID. How did the Kentucky Legislature Limit the Governor’s Pandemic Powers?
- SB 1 (2021 | KY) would limit Executive Orders to 30 days and require legislative approval to extend
- SB 2 (2021 | KY) would require a public hearing before new regulations could be imposed
What’s next for these bills? An anticipated veto + an anticipated veto override
WDRB | Bills restricting Kentucky governor’s emergency power pass legislature, head to Beshear’s desk
Sports Betting Legislation Back in Kentucky
HB 241 (2021 | KY) combines fantasy sports regulation, online poker and online sports betting.
Didn’t Kentucky try this last session too? Yes, but they’re back and adding online poker to the mix
What entity would regulate sports betting? The Racing Commission (horse racing)
How would online sports betting work?
- online wagering
- mobile wagering
- wagering at approved sports venues in the state (hello! racetracks)
- can wager on professional and collegiate contests
IGB | Kentucky to reconsider online sports betting in new bill
Legislation: State Preemption of Local Mask Ordinances
Where: Oklahoma
What: SB 224 (2021 | OK) would establish that state law concerning masks would preempt local ordinances both on public and private property
From the bill’s author: “government forcing private property owners to comply under threat of penalty is beyond their delegated powers.”
KOCO 5 | Proposed bill would prevent cities, counties in Oklahoma from mandating masks
New Houston Incentives for Eco Friendly Development
Which tax incentives did Houston upgrade for 2021?
- new property tax abatement program for developers who incorporate green stormwater infrastructure
- Up to 10 percent against their property tax increases
- opened LEED incentives that have not been open for the last 10 years
- 15 percent for platinum certification
California Committee Recommends Cannabis Rule Revisions
Cannabis Advisory Committee recommends that California roll back these rules:
- eliminate the $5,000 limit on the amount of pot that can be carried by delivery vans
- make it easier for small businesses to sell different products
- permit food and beverages to be served in cannabis lounges
All 17 of their recommendations are here: 2020 Annual Report of the Cannabis Advisory Committee
COVID Legislature: Vote from your Car
Kentucky is adapting to COVID positive legislators by permitting legislators to quarantine in their vehicles and vote from their vehicle parked on Capitol grounds.
It’s like a drive in but instead of a fun 80s movie, it is the Legislature.
Route Fifty | Kentucky Lawmakers Who Catch Covid Can Vote From Their Cars
State Budget Savings: Stop Printing Forms
The state: Missouri
The forms that the state won’t print: tax forms
Why? Cost savings and the majority of tax filers file electronically
What if you want to file a printed return? The taxpayer downloads and prints the form themself
Route Fifty | Seeking To Boost Savings and Safety, One State Eliminates Paper Tax Forms
How cities can benefit from AI (Artificial Intelligence)?
- AI friendly cities support AI jobs in telecommunications, information technology, software and transportation with starting salaries over $100,ooo
- more jobs, more economic growth
What types of AI jobs are in San Diego, a city that has embraced AI?
- 82% of total AI workforce works with machine or deep learning that is fundamental to predictive analytics
- AI tools in image, speech or video recognition (46% focus of AI jobs)
- Natural language processing (46%)
- Robotics (24%)
- Autonomous vehicles (21%)
San Diego Union Tribune via Governing | San Diego Would Benefit from City Expansion of AI: Study
2020 Recap: Money grows on weed
Where was there continual shock and awe for revenue this year? Cannabis. COVID left revenue holes and COVID funds are funding new and diverse programs from buying hotels for homeless, county fairs, event planners, restaurants and small business relief, grant programs, property tax relief grants, and PPE buying programs. Legislatures are taking control over Governors who overstepped. Voters are expanding the taxation of recreational drug use.
I don’t want to call new taxes innovative. So, let’s say the tax people got creative, maybe they ingested some of the cannabis that is now readily available to test the tax system. Here’s the new taxes they came up with: taxing IP revenue, collecting back taxes from online sales, streaming services, and Zoom.
State Budget Amendment to Benefit Hemp Farmers
Where: Massachusetts
The amendment: Would allow hemp farmers to sell their plants to legal marijuana dispensaries which allow hemp farmers into the CBD market
Boston Globe | Legislature extends a lifeline to Massachusetts hemp farmers
California Legislature COVID rules.
- 80House members will simultaneously convene from One Golden Center
- No guests on chamber floor
- Each legislator is permitted 1 essential staff member in the Capitol
- No Capitol visitors
- Face masks are required
- Social Distancing Required
COVID. Legislation Requiring Vaccinations for Health Care Workers.
The State: New York
The legislation: A11129 (2021 | NY)
New York’s A11129 would:
- prioritize distribution of the vaccine to long term care facilities
- require long term care facility workers to be vaccinated for COVID, influenza and pneumococcal disease
COVID. No Immunization Requirement Legislation.
The State: Tennessee
The legislation: HB13 (2021 |TN)
What would Tennessee’s HB 13 do? Prohibit state and local governments from “forcing, requiring or coercing” a person to receive a COVID-19 vaccination
COVID. Legislation Removing Required Immunizations.
State : Kentucky
What: BR 301 (2020 |KY)
How does BR301 change existing law that required immunizations in declared epidemic areas?
- Clarifies that nothing in state law requires immunization
- Removes language requiring immunizations in an epidemic area
- Named the Act: Ensuring Bodily Autonomy and Informed Consent Act
COVID. Legislature Proposes Vaccine Policies.
Where: New Mexico
What: HM 1 ( 2020 | NM)
What does HM 1 call on the Governor of New Mexico to do?
- adopt policies to promote nursing homes to use staff with acquired immunity
- adopt policies to aid retired people living at home to have groceries and other essentials delivered
- allow those who are not at greater risk of serious illness or death from coronavirus disease 2019 infection to immediately be allowed to resume life as normal
- adopt policies to open schools and universities for in-person learning
- adopt policies to resume sports, arts, music, cultural activities and extracurricular activities
North Dakota Legislature Mandates Masks with Enforcement
North Dakota legislators approved a mask mandate with possible enforcement options:
- removed by state troopers
- charged with a misdemeanor
- be expelled from the Legislature
- could be found out of order by the House or Senate presiding officer
Bismark Tribune | Some opposition brews to North Dakota Legislature mask mandate
Colorado Legislature Convenes with No Mask Mandate
Colorado Legislature convened with no mask mandate.
” a number of Republicans removed their masks while seated at their desks during committee meetings and on the floor”
AP | GOP aide sent home from Colorado Legislature had COVID-19
COVID Maine Legislature Relocates
The Maine Legislature will convene in a civic center.
Bangor Daily News | What we can expect when the Legislature comes together
Taxing IP Revenue
What is a patent box tax? A tax at a lower rate, usually, on income derived from IP
What type of IP revenue are we talking about? Software copyrights + patents
What’s the goal of lower tax rates for IP boxes?
- encourage and attract local research and development
- incentivize businesses to locate IP
COVID Legislation. Limits on Local Health Departments
Where: Michigan
What: HB6314 (2020 | MI)
What restrictions does HB 6314 put on local health departments? It says that local health departments can implement,ment different restrictions than state health department but that local restrictions cannot be more stringent that state restrictions
What does a remote Legislature look like?
Missouri is crafting plans for its Legislature to meet remotely.
Which party controls the State Legislature? Democratic Party
How will public testimony be taken? 16 sites across the state will be accessible for public comment, a system set up by the Missouri Senate
The Columbian | In Our View: Plans for remote Legislature session advance
COVID. State Bans Dancing.
Ohio has banned dancing at weddings in an effort to control COVID.
Ohio’s Order also includes a ban on buffet food and requiring banquet halls to adhere to social distancing.
Why does this matter? The Governor of Texas press conference in Austin, TX today indicated most enforcement of COVID restrictions had been handled by the Alcoholic Beverage Commission.
Route Fifty | Ohio Bans Dancing at Weddings to Curb Covid-19 Spread
Anatomy of a State COVID Contact Tracing Pilot Program
The state: Massachusetts
What type of tech does Massachusetts want to use? Bluetooth based tracking such as those developed by Apple & Google
Would MA continue with contact tracers too? Yes, an app would only bolster their efforts
Nevada has a similar program with a self reporting app based on bluetooth. How is the app going?
- App downloaded under 70,000 times
- Less than 3% of the state’s adult population
Mass Live via Governing | Massachusetts Looks to Fund Bluetooth Contact Tracing
COVID Funds to Lower Property Tax Bills
The State: Pennsylvania
How much federal CARES fund for COVID relief did Pennsylvania try to use to lower property taxes? $300 Million
How did this work through the Legislature:
- PA Governor and Republican legislative leaders agreed to the use of $300M to pay down property taxes
- PA Legislature passed legislation
- The Federal government rejected the use of COVID funds
What funding decisions are triggered for Pennsylvania lawmakers now?
- How to allocate $1.3 billion in remaining CARES Act money
- Can only be used for costs related to the public health emergency
- Cannot be used to fill revenue shortfalls
- State law says that money will go to the 60 least-populated counties should lawmakers fail to agree.
COVID Local Government Response: Racism is a Public Health Crisis
The Local Government: The Sacramento County Board of Supervisors
Other California Counties that have made the same declarations: Riverside, Santa Clara and Contra Costa
What will Sacramento County do in response? Take a more active role when making policy and allocating funding to address longstanding issues around race.
Sacramento Bee via Governing | Sacramento County Might Declare Racism a Public Health Crisis
Legislatures: Masks Optional
Indiana Legislature voted this month to convene its regular session in January 2021 with masks optional.
Vote reflected party lines. Republicans have super majority but won’t require masks.
When the vote occurred was the chamber open to the public? No
How many legislators did not wear masks? 2 sate representatives
How will the Legislature convene in January? The Senate will remain in its Chamber & the House will move to a larger state facility
Indianapolis Star via Governing | Masks Optional: Indiana Lawmakers Convene for Session
City of Austin COVID Tax Incentive Proposal
Who: Austin City Council
What: emergency tax incentive program
How would it work? Incentivize landlords into renegotiating commercial leases by offering commercial property tax reimbursements to landlords who renegotiate their leases and offer rent reductions to business tenants
“Drugs Won the 2020 Election”
That’s the headline from The Cut. What it really means- Drug Revenue won the 2020 Election.
Here’s the big picture from Election 2020:
- Oregon becomes 1st state to decriminalize possessing small amounts of any drug | Oregon’s Measure 110
- Arizona, Montana, New Jersey and South Dakota voted to legalize recreational marijuana in nationwide push to relax drug laws
The Guardian | Oregon becomes first US state to decriminalize possession of hard drugs
NY Times | Taxes, Heroin and Statehood: A Glimpse Into This Year’s Ballot Measures
+1 Local. Minimum Wage Raise
Not only did Florida increase the state minimum wage to $15. So did Portland, Maine.
Pre-COVID. This minimum wage ordinance had not been given the go-ahead by voters.
Voter Approval Rate: 60%
What else does the Portland Maine minimum wage ordinance require: Time and a Half pay for declared emergencies.
Portland Herald Press via Governing | Maine Voters Raise Minimum Wage and Approve Rent Control
Local Ballot. “Overpaid Executive tax”
Where: San Francisco
The voter approval rate: 65%
The goal of the tax: address income inequality in the city
When does the tax apply? “businesses in San Francisco where the highest-paid executive employee earns more than 100 times the median pay level for the company’s employees in the city”
What will be the applicable tax rate of this surcharge tax? “0.1% and 0.6% of a business’ San Francisco gross receipts, with the rate rising in steps as a company’s pay gap grows beyond the 100-times-median-pay threshold.”
The anticipated revenue: $60 million to $140 million annually
Does a similar tax elsewhere: Yes, Portland, OR has collected a similar tax since 2017
Rute Fifty | San Francisco Voters Approve ‘Overpaid Executive Tax’
States Collecting Online Sales Tax from Out of State Small Businesses
States are trying a variety of methods to obtain back sales taxes for products sold on Amazon marketplace.
What’s Amazon marketplace, a place where small businesses can sell their products to a larger audience.
So, are the states trying to collect back taxes from out of state small businesses or Amazon?
- California Department of Tax & Fee Administration is trying to collect from small businesses for sales back to 2012
- Other states taking the California approach: Massachusetts, Minnesota, Washington and Wisconsin
What are small businesses saying?
- They have an Association: Online Merchants Guild
- The Online Merchants Guild says online sellers on Amazon are more like suppliers than small businesses as they have no control over where their products go
- It’d be like going after black and decker for sales tax at a Home Depot
Which states are trying o recoup back sales taxes directly from Amazon and not the small businesses that sell on Amazon? South Carolina
How’s that going for South Carolina? It is in the courts
How are states trying to fix this legislatively? Marketplace facilitator laws, which have been passed in 33 of the 45 sales tax states
Did California Voters Curb the Property Tax Cap?
Short answer: don’t know yet if there will be a carve out from he property tax cap for business and industrial property
Current answer: Proposition 15 is 2.5% behind with 11 million votes counted.
When will a clearer picture emerge? next week
$200 M Ballot Gig Economy Initiative Passes
Where: California
What: November 2020 ballot proposition to except gig workers from a state law requirement that gig workers be classified as employees
The cost of passage: $200 Million +, the most expensive in California’s hisotry
The passage rate: 58% as of the day after election day
What do people say is next? Will these gig economy companies get swept up in the anti-tech sentiment in Congress and coming to state legislatures?
NY Times | Uber and Lyft Drivers in California Will Remain Contractors
Ballot Initiative Red State Raises Minimum Wage.
The State: Florida
What was the voter approval rate for Florida’s new statewide $15 minimum wage? More than 61%
When will the $15 minimum wage be in full effect? 2026
How did it pass? John Morgan, a lawyer and businessman in the Orlando area who backed the initiative with $5 million and said ““Every great society can crumble because the haves have too much and the have-nots don’t have enough.”
The opposition: Chamber of Commerce, Lodging Assoc., Restaurant Assoc.
Washington Post | Florida votes to raise minimum wage to $15 an hour
COVID. New Business Criminal Act for Food Industry
Where: New Jersey
What: A4765 (2020 | NJ)
What does A4765 do?
- Creates a 3rd-degree crime, punishable by a fine of $15,000, for a restaurant employee to spit into the food or drink of a law enforcement officer
- Employers would be required to suspend a worker charged with this crime
- Employers would face civil penalties if they fail to suspend the accused, but not found guilty, employee.
- Employers must terminate the employment of an employee who is convicted of this crime
Ballot Initiative: Redistricting Commission
State: Virginia
Did Virginians vote for a redistricting commission to handle redistricting? Yes, 66% approved the redistricting commission
Who will be on the redistricting commission? Elected Officials and Citizens
Do other states also have a statewide panel to handle redistricting? Yes, in 2018 Colorado, Michigan and Utah adopted redistricting commissions
In 2018 Missouri passed Clean Missouri that created a new, nonpartisan state demographer to draw legislative maps.
Governing | Voting Itself Becomes Question for Ballot Measures
Should state collected fees, paid during the pandemic, be returned?
Restaurants in California are calling on the state to return liquor fees paid during the pandemic.
Who: California Restraurants
What: Filed claims against local governments and the state for refunds of fees they’ve had during the pandemic
Which fees do they want refunded? liquor license fees, health permits and tourism assessments necessary to stay open during COVID-19.
State COVID Relief for County Fairs
Where: Iowa
How is the county fair relief being administered? Through the Governor Office and the Office of Economic Development
The funding? allocated up to $6 million of CARES funds
What are the eligibility requirements?
- Is a “Fair” as defined at Iowa Code section 174.1.
- Has continuously held membership in the AIF since at least March 17, 2020.
- Conducted a “fair event” as defined at Iowa Code section 174.1 (“Fair Event”) in Iowa in Calendar Year 2019.
- Held a Fair Event after March 17, 2020 but was subject to limitations or restrictions described in a Proclamation of Disaster Emergency issued by Governor Reynolds on or after March 9, 2020 or it canceled a Fair Event scheduled to be held in Iowa between March 17, 2020 and the submission date of the application for assistance through the Fund.
- Experienced a revenue loss for the period of October 1, 2019 through September 30, 2020 as compared with the corresponding period for the previous year.
KWQC | Gov. Reynolds announces new COVID-19 relief program for county fairs
2020 Ballot Proposition. Roll Back Property Tax Cap in California
What: Prop 15 (2020 | CA)
How will prop 15 work?
- Applies only to commercial and industrial properties
- Excepted commercial property: commercial agriculture
- The new property tax would be based on market value
- The estimated revenue: $8 billion and $12.5 billion in revenue per year
Supporters say:
- These taxpayers have had tax breaks for years
- The proposition will only affect big businesses worth at least $3 million
- Entrepreneurs and farmers will not be impacted
Opponents say:
- California already has unfriendly business tax laws
NY Times | California Tax Revolt Faces a Retreat, 40 Years Later
BLM Legislation. Call for National Juneteenth Holiday
Where: Ohio
What: HCR 33 (2020 | OH)
What does the resolution call for?
- Acknowledgement of those who marched to protest the social inequity and racism
- Asks Congress to establish a national Juneteenth holiday to help restore the U.S. status as a “beacon and symbol of democracy and freedom
BLM Legislation. Community Repair Panel
Where: Minnesota
What: SF 33 (2020 | MN), The PROMISE Act
How will the PROMISE ACT work to repair the community? With $125 million in fiscal year 2021 for awards to repair damaged property and small businesses
BLM Legislation. Commission on the Status of African Americans and Latinxs
Where: Rhode Island
What: HB 8133 (2020 | IL)
The Commission on the Status of African Americans and Latinxs will:
- provide research-based policy & practice recommendations to the Legislature and state offices
- help to ensure citizens equal access to government services and to propose changes to laws and practices that benefit other citizens at their expense
BLM Legislation. The Inclusive American History Commission.
Where: Illinois
What: HB 5851 (2020 | IL)
What does HB 5851 do?
- Creates the Inclusive American History Commission to develop guidelines for “multiperspective, inclusive and comprehensive” instruction in history
- While the Commission works, most American history curriculum is suspended in Illinois
New Revenue Estimates for Cannabis in Texas
If Texas legalized/decriminalized cannabis, what would the numbers look like in Texas according to Vicente Sederberg LLP ?
- $2.7 billion in cannabis sales annually
- $1.1 billion in marijuana tax dollars over the biennium
- 20,000-40,000 jobs directly created
- $10 million annually if business licensing fees (with a $5000 licensing fee)
- $311 million in savings per year in criminal justice resources
COVID & BLM. OKC Funds Small Business Recovery
Utilizing CARES Act Funds, Oklahoma City has created a program that funds minority small businesses.
Why is OKC prioritizing minority owned businesses?
- They’ve had a greater economic impact from he pandemic
- U.S. Chamber of Commerce warned in August that minority-owned businesses were denied in higher numbers for loans to help survive the pandemic
The Funding program:
- $2 million total grants
- for businesses with 25 or fewer employees
- Offering grants up to $25,000 each
Governing | Oklahoma City Gives More Funds to Minority Small Businesses
COVID. Economic Development Bill to Help Business Access PPE
Where: New York
How is New York connecting businesses, PPE and economic development?
- Create a tax credit for the purchase of PPE
- If the tax credit exceeds an allowable amount, the credit can carry over
- Creates a program for the state to purchase PPE and to sell it to small businesses at cost
COVID Funds to Help Small Businesses File for Bankruptcy. Only in NY
New York is temporarily adding bankruptcy legal assistance to its state funded legal assistance program to help businesses impacted by COVID restrictions
A11084 (2020 | NY)
COVID Funds. Helping Non-Urban Small Businesses with Commercial Rent.
New Jersey will put $6 million into a state program to help suburban & rural small businesses with rent payments if:
- the business leases space of less than 5,000 square feet
- grants are limited to $10,000 per grant.
S2983 (2020 | NJ)
COVID Funds. Grants for Bars Brews & Fish
Louisiana wants to help its fishermen, bars and breweries with funding from a new Bar Assistance Relief Program.
$2,000 grants if they have no more than 50 employees & are not subsidiaries of, or owned by, larger businesses HB85 (2020 | LA)
COVID Funds. State Business Loans to Cover Property Taxes
Michigan is proposing loans for small businesses to cover property taxes for businesses closed by executive order. Loans would have zero interest and 2 year terms. H6242 (2020 | MI)
COVID Funds: State Sets up Small Business Grants
South Dakota wants to use unspent COVID funds for business grants. Eligible businesses would have seen a loss of 25% of revenue and have revenue below $38.5M. SCR601 (2020 | SD)
Cannabis Revenue in Illinois By the Numbers
Total Revenue Collected: $100+ million since 1/1/2020 legalization
State revenue from 9 months of cannabis legalization: $69.7 million through the Cannabis Regulation Fund
Sales tax portion of cannabis legalization: $36.1 million from state and local sales taxes
Revenue that goes directly to cities: $16 million
How are state cannabis revenues allocated?
- 50% reinvested through the Restore, Reinvest and Renew (R3) Program in communities that have been disproportionately impacted by the justice system or directed to address substance abuse and prevention, and mental health concerns
2020 Cannabis Ballot Propositions
5 2020 State Ballot Propositions for Marijuana
- Arizona
- legalization with criminal justice reforms
- estimated sales by 2024: $700 million
- Opponents: billionaire casino magnate Sheldon Adelson, tire retailer Discount Tire, pharmaceutical company Insys, Arizona Chamber of Commerce and Smart Approaches to Marijuana
- New Jersey
- legalize cannabis for adults 21 and older
- 6.625% tax rate
- South Dakota
- medical cannabis program and registration system + legalization for all residents
- Montana
- legalization
- 20% tax on recreational cannabis
- Mississippi
- medical use only
This week Pennsylvania Governor also encouraged the Legislature to legalize recreational marijuana and to decriminalize it.
KDKA | These States Are Voting On Marijuana Legalization This November
COVID Legislation. Reigning in Gubernatorial Power.
The State: Arizona
What’s happening in Arizona: Claims the the Governor is asking law enforcement not to enforce restrictions against bars and restaurants that violate Executive Orders. The State Attorney General has taken issue with this approach.
Who should be picking the winners/losers (which businesses can be open): According to the Arizona Attorney General, that’s the Legislature’s job.
So what did the Legislature do? Created the Ad Hoc Study Committee on Legislative Oversight of Emergency Executive Powers
Arizona Capital Times | AG challenges governor’s emergency powers
AZ Mirror | Legislative committee hopes to curb Ducey’s emergency powers
#21 International Tax Competitiveness
The friendly folks at the Tax Foundation put together an index of the most tax competitive nations.
What does it mean to them to be tax competitive? “A well-structured tax code is easy for taxpayers to comply with and can promote economic development while raising sufficient revenue for a government’s priorities. In contrast, poorly structured tax systems can be costly, distort economic decision-making, and harm domestic economies.”
Who is #21? The U.S.A
What’s the top 10 look like?
- Estonia
- Latvia
- New Zealand
- Switzerland
- Luxembourg
- Lithuania
- Sweden
- Czech Republic
- Australia
- Slovak Republic
Where are the U.S. tax strengths:
- expensing for business investments
- Last-In-First-Out treatment of the cost of inventory
- Corporations can deduct property taxes
Where are the U.S.’s challenges?
- progressive income tax with a top rate of 46%
- does not exempt foreign capital gains income
- real property tax burden is among the highest
Tax Foundation | 2020 INTERNATIONAL TAX COMPETITIVENESS INDEX
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