For the legislative and political week January 24-28
Welcome to the January 24-28 edition of the NFIB California Main Street Minute from your NFIB small-business-advocacy team in Sacramento.
Single-Payer Health Care Bill Heads to Assembly Floor
On an 11-3 vote Thursday (January 20), the Assembly Appropriations Committee passed Assembly Bill 1400 calling for the creation of a single-payer health care system in California. The measure now comes up for a floor vote in the Assembly, which must pass it on to the Senate by January 31 or the bill is dead for the year.
The cost. According to the bill’s analysis, “The California Health Benefits Review Program (CHBRP) estimates California’s overall health care spending from all sources was $330.7 billion in 2021. Adjusted for inflation, previous analyses of single-payer bills in California (SB 840, SB 562) suggest that this bill could result in between $314 billion and $391 billion in total health care spending.”
The entire state budget proposed by Gov. Gavin Newson this month is $286 billion.
NFIB joined with 121 other business groups in a coalition letter to Appropriations Committee members opposing AB 1400. “Single-payer health care must not be confused with free health care – there’s nothing free about a government run health plan. AB 1400’s new companion bill, ACA 11, proposes increasing Californians’ taxes hundreds of billions of dollars to fund the government run health care system … This proposal would be the biggest tax increase in state history and punish Californians by increasing personal income taxes, payroll taxes, and gross receipts taxes. This enormous tax increase would occur at a time when California is experiencing a $31 billion surplus – a surplus that pales in comparison to the annual expenditures a government run health system would demand.”
A special thank you to the NFIB members who responded to the Action Alert and let Assembly Members know of your concern with AB 1400. According to Grassroots Manager Taylor Criddle, 307 NFIB members sent 437 messages.
Unemployment Insurance Trust Fund
- In a January 19 coalition letter to the Assembly and Senate budget committee chairs and vice-chairs that NFIB signed with 60 other business groups, it said, “We are glad that the Governor has proposed to pay $3 billion towards this outstanding UI debt. This payment would cover the State’s responsibility for distributing fraudulent payments as well as a small but meaningful portion of the outstanding $19.7 billion insolvency. We respectfully request for the Legislature to support the Governor’s proposal …
- “Generally, the contribution rate for an employer is 0.6% of wages, up to $7,000 of wages per employee/per year, which is $42, assuming the state is in compliance with unemployment insurance laws and the state’s fund is solvent. However, if a state’s UI Fund is insolvent for more than two years, that tax rate increases by 0.3% each year or $21, until the fund becomes solvent, creating a steadily growing tax increase on the state’s employers. If the fund remains insolvent for 18 years, the maximum rate is $420 per employee per year.”
Paid COVID-19 Sick Leave
- “There was a statewide requirement that companies with more than 25 employees offer as much as 80 hours of supplemental sick leave related to COVID-19, but it expired in September of 2021. Legislators and the Newsom administration are currently negotiating over bringing back extra paid sick leave for COVID, with the goal of an agreement in the next several weeks.” So reports CalMatters in a story about commonly asked questions by employees. NFIB opposes the idea, which adds more onerous costs and reporting burdens to our members and all small businesses.
Zero Emission Vehicles
- The Assembly Appropriations had more bad news for business. On another 11-3 vote, it passed Assembly Bill 1218, which according to the measure’s analysis “codifies the goal of the state, as established in Executive Order (EO) N-79-20, that 100% of in-state sales of new passenger vehicles and light-duty trucks will be zero emission vehicles (ZEVs) by 2035. Specifically, this bill requires the California Air Resources Board (ARB), to the extent consistent with federal and state law, to develop and adopt passenger vehicle and light-duty truck regulations requiring increasing volumes of new ZEVs sold in the state towards the goal of 100% by 2035.”
- Not so easily done cautioned a business coalition letter, co-signed by NFIB, to Assembly Member Kevin McCarty, the bill’s author. “The gap between where California sales are today and what AB 1218 requires ZEV sales to increase to is 800%. Successfully electrifying the entire new vehicle fleet, without leaving Californians stranded, requires far more than just banning cars available today. It requires a robust infrastructure for electric vehicle charging and hydrogen refueling.”
- President Biden addressed the nation last week and acknowledged the Build Back Better Act (BBB). Sen. Joe Manchin said on January 20 that BBB negotiations with the White House are going to be “starting from scratch.”
- NFIB fought to have the following provisions scaled back or removed from BBB:
- Limiting the Small Business Deduction (Section 199A)
- Raising the corporate tax rate from 21%
- Raising the top income tax rate from 37% to 39.6% on pass-through businesses
- Expanding the estate tax’s reach
- Increasing the top capital gains tax rate
- Mandating that small businesses provide retirement accounts
- Establishing a 12-week paid family and medical leave program.
Next Main Street Minute January 31.