The Legislature is ending week four of the latest special session. A deal was struck between the House and Senate on Tuesday to change the process for overturning parts of an executive order. There is not much remaining on the calendar, and rumors are starting to circulate that the session might end before the originally set date of October 27.
Here is a status update for issues BRAC has been watching this session.
Payment in Lieu of Taxes
The Senate Revenue and Fiscal Affairs committee failed to pass HB 78 (Beaullieu), which would have made PILOTs, Payments in Lieu of Taxes, into a stronger economic development tool. PILOTs are a mechanism by which companies and local governmental units may negotiate upfront monetary payments in lieu of property taxes paid in the longer term and are successfully used in states across the country. The Senate Revenue and Fiscal Affairs Committee is shaping up to be the roadblock for many business development bills.
Unemployment Trust Fund
One major business tax issue was resolved this week when the legislature postponed the impact of statutory triggers related to the Unemployment Trust Fund (UTF). When the UTF is depleted to current levels, existing law automatically increases the taxes businesses pay and automatically reduces the unemployment benefits people receive. The higher tax would have gone into effect at the beginning of 2021 without legislative action. The Legislature passed SCR 5 (Reese) and SCR 9 (Cortez), which suspend the existing statute until July of 2021, giving businesses and unemployed residents a little more time to recover from the economic impact of the pandemic. Nonetheless, the State will have to come up with the money at some point to repay a loan taken from the federal government to shore up the Fund.
Overturning Executive Orders
On the undergirding reason the legislature called itself into session, the Governor’s executive authority over states of emergency, the House and Senate agreed to HB 4 (Wright) this week. The bill creates a mechanism by which the Governor would notify legislative leadership of a renewal of a state of emergency and establishes a tool for both chambers’ leadership to call for a vote to overturn provisions of the state of emergency. The bill passed the House with 54 votes, well beneath the 70 needed to override a veto by the Governor. The bill would require a majority of both chambers to override a provision. Prior to this bill, there was uncertainty in the law about whether the Legislature could overturn provisions of an order or needed to override the entire order. The bill will head to the Governor for his signature or veto.
Look forward to BRAC’s final wrap up of the legislative session next week.