BILLS, BILLS, BILLS
Illinois voters rejected a constitutional amendment to overhaul how the Land of Lincoln taxes income from a flat tax to a graduated or progressive income tax. The amendment itself merely removed a constitutional mandate that all personal income be taxed at a flat rate. Thirty-two other states and Washington, D.C. all have some form of a progressive income tax. Illinois is looking at an $8 billion budget shortfall and Lt. Gov. Juliana Stratton previously warned that lawmakers would be forced to consider raising income taxes on all Illinois residents by at least 20%.
IF I HAD A $1,000,000
California voters rejected Proposition 15, which sought to gut the Golden State’s more than 40-year-old property tax limit for commercial property. The ballot measure only repealed property tax limitations for commercial property valued at more than $3 million. The state Legislative Analyst’s Office estimated that Prop 15 would have increased property taxes between $8 billion to $12.5 billion annually. Opponents of the ballot measure argued that up to 80% of small businesses rent their property and the additional cost of the property tax increase would be passed on directly from property owners to small business renters.
TAKE THE MONEY & RUN
Colorado voters approved Proposition 116, which drops the Centennial State’s income tax from 4.63% to 4.55% next year. The cut on the individual and corporate income tax rate will reduce revenue by an estimated $154 million for the 2021-22 budget year. Colorado is already facing an estimated $1.6 billion deficit. Voters also approved the creation of a paid family AND medical leave program. The ballot measure requires workers and employers to pay into an insurance pool run by the Colorado Dept. of Labor. Beginning in 2024, workers could apply to the fund to receive pay during time off from work, up to $1,100 per week. Companies that already offer comparable paid family and medical leave are exempt.
ALL ABOUT THE BENJAMINS
Arizona and Arkansas voters approved measures to increase taxes in their respective states. In Arizona, Proposition 208 essentially set up a fifth income tax bracket for wealthy residents that would raise the top rate to 8% from 4.5%. The tax is expected to raise an estimated $940 million per year, and revenue would be used for education-related expenses. In Arkansas, Issue 1 permanently extended a 0.5-cent sales tax increase to provide the state with an extra $205 million a year in annual infrastructure and highway funding.
The 46th President Is...
Former Vice President Joe Biden became President-elect Joe Biden after all major networks projected on Saturday that he won Pennsylvania. Biden overcame an initial 700,000-vote deficit on election night to secure the state’s 20 electoral votes and capture the 270 total electoral votes needed for the White House. Vice President-elect Kamala Harris made history as the first woman and the first Black and South Asian American to win the second highest U.S. office.
WHO WILL CONTROL THE SENATE?
A pair of Georgia races will most likely decide which party controls the Senate next session. Both Sens. David Perdue and Kelly Loeffler are short of the 50-percent threshold required to win their respective seats and avoid a runoff. Democrats will need to win both of Georgia’s seats to secure control of the chamber with the tie-breaking vote of Vice President-elect Kamala Harris. Georgia’s runoff election is Jan. 5.
Making Our Way Around the Country
In another ballot measure, California voters approved Proposition 24, the California Privacy Rights Act (CPRA). The CPRA significantly amends and expands the California Consumer Privacy Act of 2018 (CCPA). One of the provisions of Prop. 24 includes giving Californians the ability to tell businesses not to use certain categories of information, including race, health, religion, and biometrics. It also makes clear that “do not sell” includes data shared between companies as well as triples fines for violations if the affected consumer is younger than 16 years old. Most notably, the measure establishes a new government agency, the Privacy Protection Agency, which is vested with full administrative power, authority, and jurisdiction to enforce privacy laws. The agency will be governed by a five-member board. The CPRA goes into effect January, 1, 2023.
Gov. Phil Murphy signed the strongest single-use bag ban in the nation, effectively prohibiting the use of single-use plastic and paper bags in all stores and food service establishments across the state starting in May 2022. It will also ban disposable food containers and cups made out of polystyrene foam. The bans apply to a variety of businesses, including restaurants, convenience stores, food trucks, movie theaters, and grocery stores that are 2,500 square feet or larger. Under the new law, food service businesses will be allowed to provide single-use plastic straws only upon request starting November 2021.
Lawmakers in the Show-Me State asked Gov. Mike Parson to add coronavirus liability to his call for a special session. Legislators want a business-friendly law shielding nursing homes, schools, and other businesses from liability lawsuits related to the pandemic. A coronavirus relief package is the main focus of the special session. Sen. Bill White said he was planning to file liability legislation when lawmakers convene for the start of their regular session in January. Missouri expanded workers’ compensation benefits to first responders who contract COVID-19 during the state of emergency.
This week we pause to thank the brave men and women of the armed services as we celebrate Veterans Day. We also applaud the significant efforts by members of the insurance industry who provide valuable training and career opportunities in this field for returning servicemen and women.