The legislative session may have ended, but the legislative process hasn’t.
Though many business-related bills died when the General Assembly adjourned May 7, the fate of a handful of others rests with Gov. M. Jodi Rell. She has 15 days to make a decision once she officially receives the bills from the Secretary of State’s office.
In several cases, business groups are hoping for a veto. That’s definitely true of a measure to raise the minimum wage from the current $7.65 per hour to $8 per hour in 2009 and to $8.25 in 2010.
The most adamant opposition to the hikes has come from small business, which argued throughout the session that an increase would cripple them financially at the most inopportune time.
“We have opposed the bill in both the House and the Senate and were very critical of both chambers for passing it,” said Andrew Markowski, director of the Connecticut chapter of the National Federation of Independent Business. “It is absolutely the wrong time to do this because of the economic insecurity small businesses are facing.”
‘Far-reaching’ effects
The Connecticut Business & Industry Association has also voiced its dissent, and it joins the NFIB in calling for a Rell veto.
“We generally don’t like measures adopted in the state that would make it more expensive to do business,” said Bonnie Stewart, CBIA’s vice president of government affairs. “It doesn’t just increase the starting wages for students in retail, for example. It also has an impact on union contracts tied to the minimum wage.”
Stewart said increasing the minimum wage has “far-reaching” effects on companies’ costs of doing business in the state — costs legislators largely ignored.
Markowski said that raising the minimum wage, and effectively increasing the budgets of small businesses, is hypocritical, given the high priority legislators have placed on avoiding increases in the state budget.
“If the state’s trying to send a message that they need to cut back and reduce spending, how can they turn around and force small businesses to increase spending?” Markowski said. “Everyone is affected right now by the economic downturn, not just the state. Businesses are feeling it too.”
Proponents for the bill, including the Connecticut Voices for Children and the Connecticut Association of Human Services, have argued the exact opposite point, namely that an economic downturn tied with rising utility costs makes it necessary to give low-income families a boost.
Similarly, the proposal to open up the state’s health care plan to municipalities and small businesses has received support because, its proponents claim, it would help families cope with skyrocketing health care costs.
Lower Costs?
In particular, Speaker of the House James Amann, D-Milford, and Secretary of State Susan Bysiewicz are supporters because they believe it would lower costs for towns and business owners.
“By expanding the purchasing power of the state pool, we can drive down health care costs for the small business community that is responsible for more than 90 percent of all new jobs in our state,” Bysiewicz said in a statement.
But the CBIA’s Stewart said expanding the health plan is an “unknown risk,” and the state is not certain costs would be reduced.
Small business owners, according to Markowski, are split on the proposal, and the NFIB has not taken a formal position. The NFIB did submit general testimony in support of cutting health care costs.
“We’re opening to listening to any proposal to reduce health care costs, and we applaud that this proposal would be open on a voluntary basis,” Markowski said. “Moving forward, obviously we want to make sure any proposal remains voluntary.”
A less publicized measure enacted by the General Assembly is an environmental bill that would establish caps on the level of greenhouse gas emissions. If signed into law, the state would have to reduce its emissions to 10 percent below 1990 levels by 2020 and 80 percent below 2001 levels by 2050.
Though the bill has been altered significantly by removing mandatory steps the state must take, CBIA’s associate counsel Eric Brown said the bill still puts unnecessary stress on businesses.
Numeric Goal
“We’re still uncomfortable with setting a mandatory numeric goal,” he said. “We felt that the previous legislation with goals the state should attempt to reach was a more appropriate scenario.”
The bill is supported by a slew of environmental groups, including the Connecticut Fund for the Environment, the Sierra Club and the Department of Environmental Protection. The Connecticut Fund for the Environment has been pushing for the mandatory caps because the group feels the voluntary caps passed in 2004 are insufficient.
Bills That Died
The majority of business-related legislation, however, failed to make it out of the General Assembly, mostly because legislators were reluctant to pass any measure that added costs to the budget. They included:
• A proposal to create a tax credit for angel investors who provide capital to start-up companies, which died in the Senate.
• A proposal to impose a sales tax on delivery services that would have helped fund the state’s Payment In Lieu Of Taxes funding for municipalities for state-owned property, which died in the House.
• A proposal to create the nation’s first state-run 401(k) plans for small businesses, which died in the House.
• A proposal to increase funding for technical schools by $2 million that would have created a statewide green jobs training program, which died in the House.
• A proposal to mandate employers with 50 or more employees to give one hour of sick leave for every 40 hours worked to a maximum of 52 hours per year, which died in the House.
