Regulatory reform and fixing tax policy to boost education funding are among the top priorities for the state’s largest business association as the 2017 legislative general session gets underway.
The Salt Lake Chamber’s priorities list was revealed last week during the organization’s Policy Summit. The legislative session begins Jan. 23.
Lane Beattie, the chamber’s president and chief executive officer, was among several speakers during the summit and an earlier Utah Economic Review event who stressed that education is the key to Utah ultimately having a better-prepared and skilled workforce.
“As we enter this legislative session, no issue is of greater significance than modernizing our tax code and enhancing funding for education,” Beattie said. “While some have been surprised with our support for our ‘schools now’ initiative, they should not be confused — nor should you — about the intent behind our support: Accountability, innovation and investment in our education system has been the mantra for years to develop the best workforce in this country.”
The Legislature in 2012 adopted by resolution the chamber’s “Prosperity 2020” education improvement plan, and Beattie emphasized that Utah must improve student achievement and increase accountability for education results. Chamber documents indicate the organization also supports efforts to align the private and public sectors to attract and train a skilled and talented workforce.
The chamber is calling for a review all existing taxes, fees and exemptions while also wanting to keep legislative flexibility for future appropriations. The chamber also wants greater equity and efficiency in the tax code by addressing sales taxes on manufacturing inputs, remote sales and Utah’s tax apportionment formula.
Another major thrust for the chamber this session is regulatory reform. It says changes would improve Utah’s “already exemplary” regulatory system, in part by including a rulemaking note on each legislative bill, requiring better analysis of each administrative rule and other changes that the chamber says will make Utah’s regulatory system even more competitive with other states.
“Regulation reform is among the easiest and simplest ways for policymakers that they can influence economic growth, and a modern, balanced and transparent regulatory system gives businesses the confidence they need to hire, to invest and to innovate. … Simply, the cost of regulation is killing many businesses, even here in the state of Utah,” Beattie said.
Regulation is so burdensome nationally that some people have calculated that it accounts for one-fourth of the cost of a home, he said. “Twenty-five percent. Does that impact you or your family?” Beattie asked.
The chamber also wants to see a statute that allows new public-private partnerships to bring innovative approaches to infrastructure investment, finance and operations.
Another issue that may arise in the 2017 session involves non-compete agreements, whereby an agreement is reached between a company and a worker prohibiting the worker, upon leaving the company, from competing with the company by offering products, processes or services similar to those offered by the company. A compromise bill passed last year calls for such agreements entered into after May 10, 2016, to be limited to one year after the employee is no longer employed by the employer.
The chamber supports the “reasonable and responsible” uses of non-compete agreements and other post-employment restrictive covenants that adequately protect both employers and employees and are freely and openly entered into by both parties, and it stands by the 2016 compromise.
Beattie said the chamber is seeking information about how companies and employees view such agreements.
“The reality is, we are very, very concerned about non-competes in the state. … We’re anxious about it,” he said. “There are some who are concerned we went too far. There are some who would like to go a lot further. We are not one of those. We really do believe that we need the information and to get it to the Legislature.”
“You’re going to see some people that are going to want to have this discussion because they view this as problematic,” said House Majority Leader Brad Wilson, R-Kaysville. “You know, we talk about these stories and there are stories on both sides. There are companies that are going to be adversely affected and [think] we’ve taken this too far, and we currently have an environment where individuals and employees can be adversely affected, so [we are] trying to strike that balance. But I would say, until we get the information, we don’t know exactly what path we’re going to be on.”
Sen. Jerry Stevenson, R-Layton, agreed that the non-competes issue “will come up again through the session.”
The chamber also backs more efforts to improve Utah’s air quality, through the promotion of cleaner vehicles, expanded access to transit and minimizing small-business costs. It also wants funding and research to help Utahns better understand the causes and effects of poor air quality.
“It’s a concern,” said Val Hale, executive director of the Governor’s Office of Economic Development (GOED), who said poor air quality can hurt the state in recruiting companies and employees to the state. “It’s something that businesses talk about, especially a lot of the tech companies.”
While Utah’s air quality has improved and many government and business efforts have been undertaken to address the issue, “it’s something we’re all going to have to work on, because it is probably, if you list all of the negatives in [Utah’s] quality of life, that may be the one that comes up the most,” Hale said.
The chamber also is supporting “sensible” reforms to the state’s liquor laws “that seek to balance satisfying public demand, ensuring public safety, discouraging underage drinking and cultivating a welcoming and hospitable climate for tourism and business recruitment efforts,” and a greater investment in Utah’s water data to inform and develop an “actionable, adaptive and comprehensive” state water strategy.
The chamber’s 28-page Public Policy Guide 2017 is at slchamber.com.