The Tax Man Cometh

Governor Markell released his budget for FY2015 and it includes new taxes, including a 10 cent per gallon increase in the gas tax. He also wants to increase taxes on businesses and move money from the Transportation Trust Fund to help offset the deficit.

Where are we going with this?

Much of this increase in spending is unnecessary and there are ways to pay for the spending without new taxes. For example, Delaware could save $90 million a year in the infrastructure category if they simply change their prevailing wage methodology from the state’s prevailing wage survey to the US Bureau of Labor & Statistics (BLS) survey. This is because Delaware’s survey is much more union-friendly and has caused public works projects to see an explosion in spending. The BLS survey includes more businesses and while still union-friendly is much less so than the state’s.

Delaware has $29 million sitting in bank accounts, unspent money collected from the Regional Greenhouse Gas Initiative. This is money polluting businesses pay to the state in order to “offset” their emission of CO2. The idea was that money would be spent on low-income weatherization projects (like installing energy-efficient windows or dishwashers in homes), but in reality most of the money spent was on administrative costs, with very little going to these projects (which had their own problems).

Delaware also makes the cost of business difficult, with electric prices 25% higher than the national average, the state with the worst gross receipts and corporate income tax rate together, and a personal income tax rate which make Delaware uncompetitive with Florida or Texas for jobs; in place the state has to essentially pay companies like ILC and Kraft Foods to keep jobs here. What we need is a natural gas pipeline to lower energy costs, a repeal or at least reduction in the tax rates mentioned above, and more support for existing firms. Delaware was last in the nation in terms of job expansion by existing in-state firms.

Let us hope that the General Assembly decides to move Delaware in a pro job-growth direction and away from punishing the middle class and small businesses of Delaware with onerous taxes and fees which are only encouraging the state to spend more.

*Note:This article will be updated when further details about the FY2015 budget are revealed.

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recap of the Governor’s State of the State Address

Governor Jack Markell delivered his State of the State (SOTS) address yesterday in Legislative Hall. His 42 minute speech focused on a diverse set of topics: education, mental health/substance abuse, reducing pollution in the state’s waterways, spending more money on infrastructure (roads, bridges, etc) revitalizing downtowns like Wilmington, dealing with “gun violence” and  new government programs to help students become work-ready and to help the unemployed find work. (read a recap here)

Noticeably absent? Any serious discussion of the economic record of Delaware, energy prices which are 25% higher than the national average, how the state was making expanding business possible (Delaware ranks last in existing firms expanding), what the state is doing with Sea Level Rise legislation, you get the picture. As was expected, the speech was more of a list of what Delaware is going to spend on this year, rather than a list of ideas which will not require extra spending.

Not all was bad in the speech: certainly offering students a chance to explore different fields of study is a good thing, and there is nothing inherently wrong with wanting to see the downtown areas revitalized. However, the Governor would not say how he intends to pay for $500 million in new spending-but we can figure it out: more taxes and fee increases, plus some borrowing and bond selling.

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Implementing Workers Compensation at a CCRC

CCRC Workers Comp As today’s seniors continue to age, there is an increasing number of individuals that will need the care and services of the senior living industry. Because of that increase, the idea of continuing care retirement communities, or CCRCs, has popped up, giving more seniors the option to grow older in one location, rather than moving from place to place as their needs change. Along with this implementation comes the need for CCRC workers comp to protect those that run CCRCs and have employees.

Ensuring Quality Care

In order to provide the services necessary for seniors in a CCRC, business owners need to hire experience and highly trained employees. As the need of seniors’ care change from independent living to assisted living, the toll on employees can increase, increasing the need of CCRC workers comp. Without the insurance that they will get the help they need in the case of an incident, many employees may find work elsewhere. In order to provide your clients with quality care and hold on to those irreplaceable employees that keep your business running smoothly, it is a good idea to invest in workers comp.

Keeping Seniors Healthy

The main goal in the senior living industry is to keep seniors healthy for as long as possible, and CCRC workers comp can help you do that by maintaining a good work force that will provide the best care available.