Capitol 411: October 8 Update

The Legislature is at the end of its second week of the special session. The House and Senate both adjourned Tuesday while they await the passage of Hurricane Delta. To date, the majority of the special session has been spent debating the Governor’s authority during a state of emergency with the House and Senate sharing differing ideas on how to restrict that authority.  

Other important measures are also working through the process before the legislative session ends on October 27. Read about their progress below. 

Payment in Lieu of Taxes 

One of the more interesting bills to move so far is HB 78 (Beaullieu), which changes the rules for PILOTs, Payments in Lieu of Taxes, a mechanism by which companies and local governmental units may negotiate upfront monetary payments in lieu of property taxes paid in the longer term. This bill is connected to Constitutional Amendment 5 on the November ballot, and would only go into effect if C.A. 5 passes. The bill gives a larger set of industries eligibility to negotiate PILOTs while also reducing the number of years any PILOT may last. The bill passed the House Ways and Means Committee on Monday and is scheduled for the House floor on October 12.   

Unemployment Trust Fund 

One issue flying under the radar, which will have an enormous impact on businesses and unemployed individuals, is the statutory triggers related to the Unemployment Trust Fund (UTF). Current law automatically increases the taxes businesses pay to the UTF because it has depleted to such low levels. The law also automatically reduces unemployment benefits. The monetary floor that the UTF must get to in order for these changes to take effect has already hit and would go into place at the beginning of 2021. However, the Legislature is currently considering four measures to address these triggers: SCR 5 (Reese), SCR 9 (Cortez), HCR 20 (Schexnayder), and HB 70 (Schexnayder). Each measure addresses the issue differently; the SCRs and HCR are suspensions of the existing statute until July of 2021, while HB 70 repeals the law altogether. We will see if or what manages to pass, but 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.  

The next week will give us greater insight into what will come from the session. The members want to get the executive power restriction measures to the Governor as soon as possible, allowing the Legislature to attempt to override any vetoes that might occur while the Legislature is in session. The Legislature will only have 16 days to complete their business when they come back on October 12. 

David Zoller

As BRAC’s Manager of Governmental Affairs, David Zoller is responsible for the organization’s governmental relations and advocacy efforts and managing other projects related to economic competitiveness and quality of life.

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