Vital Unemployment Bill Passes Indiana House

The folllowing is a legislative update on HB 1450 regarding unemployment insurance:

Bill # and Title: HB 1450 – Unemployment Insurance
Author: Rep. Dan Leonard (R-Huntington)

Summary: Establishes the weekly unemployment benefit amount as 47% of the individual’s prior average weekly wage. This is calculated by dividing an employee’s earnings during a year (regardless of how many weeks the employee has worked) by 52. Establishes the maximum weekly benefit amount at $390 (which is the current maximum). This change will not become effective until July 1, 2012. This means that people currently drawing unemployment benefits will see no change to their benefits. Places all employers into Rate Schedule E (a lower rate) for the years 2011-2020. Establishes a 13% surcharge for employers to pay into the unemployment insurance solvency fund in order to pay interest due on the outstanding balance of federal loans.

Chamber Position: Support

Status: The bill passed out of the House with 61 votes and was sent to the Senate Tax and Fiscal Policy Committee for consideration.

Update/Chamber Action: In addition to working to get the bill passed in the Senate, the Indiana Chamber is also involved in researching the issue of whether bonds could be issued to pay off the loan to the federal government (a little over $2 billion was owed as of late January). Besides the possibility of getting a lower interest rate (currently the federal government is charging around 4% interest on the outstanding loan balance whereas the interest rate might fall to around 2-2.5% under a bond), if the loan was paid off then Indiana employers would not lose their federal credit toward the payment of their federal unemployment taxes. While unemployment insurance taxes will increase next year (and they must to help return the system to solvency), the Chamber-led shift to Schedule E rates will result in $2 billion in savings (over the intended new rates) for Hoosier employers over the next 10 years.

Evansville Courier & Press: Township Reform is Needed

Mentioning the Indiana Chamber’s support of the movement, this Evansville Courier & Press editorial argues that townships simply aren’t very convincing when it comes to demonstrating their usefulness for Indiana:

Although the case for downsizing or eliminating township government remains a hard sell to the Indiana Legislature, the case for local government reform remains ever more compelling.

Yes, the Indiana Chamber of Commerce came out this past week in support of either the elimination of township government or of at least the elimination of advisory boards in each of Indiana’s townships. But that is no surprise. The organization that lobbies for issues favorable to businesses has long supported the downsizing of local government, particularly of township government, as a way of reducing local government costs.

Of more interest, we found news reports this past week of two more issues involving specific townships elsewhere, as reported in other news media. They stand as further evidence that townships have too much time and tax money on their hands.

Also, Indiana Gov. Mitch Daniels, whose legislative agenda includes local government reform, will come to the January session armed with what we would call compelling information in support of ending township government in Indiana.

Of course, locally we had the case of former Knight Township Trustee Linda Durham, who allegedly misappropriated $70,000 in township funds. She awaits trial, and if the charges prove true, it will be one more indication that township government is woefully lacking in oversight.

Also, Eric Bradner of the Courier & Press Capital Bureau reported about a year ago that township governments statewide were sitting on $215 million in surpluses, much of it intended for emergency poor relief.

More recently, according to the Associated Press, via the Indianapolis Star newspaper, the Wayne Township trustee in Marion County earlier this month was found planning to give $200,000 in poor relief funds to the Indianapolis-Marion County Public Library to allow for longer hours at four library branches.

The trustee, David Baird, said his plan fit in with the township’s mission for poor relief in that the poor use the libraries’ computers and other resources to look for jobs.

This is not the intended purpose of poor relief. It should be utilized to address urgent needs, such as preventing electricity from being turned off, or for filling urgently needed prescriptions. But township trustees seem to take tremendous latitude in deciding how to spend tax-financed poor relief.

The Indianapolis Star reports on a State Board of Accounts audit of Jefferson Township in Sullivan County, which resulted in the trustee and his wife, working as the office clerk, having to give back $42,366 to the township for payments they should not have received.

Chamber Director’s Resignation Stems from Twitter Feed

When I read the headline for this story, I initially assumed this director probably had too much to drink and spouted off a personal opinion about someone or something (as many of us do from time to time) on her Chamber’s Twitter feed, thus leading to her departure. But reading her actual Tweets illustrates how fine the line is between what should and shouldn’t go out via a business’ social media program. Granted, her posts might be construed as a bit too informal, but nothing here seems all that egregious. Here is an excerpt from the article at AnnArbor.com, and the site itself shows a few examples of the Twitter feed in question:

The rules that govern the social media world are constantly evolving, but an episode that led to the resignation of the Dexter Area Chamber of Commerce’s executive director shows that ignorance about that evolution is risky.

Mary Ann Bell Falzon resigned last week after a column in a community newspaper questioned the content of her Twitter account, which she was using to promote local businesses through the chamber’s “Doing Dexter” campaign.

Falzon’s mistakes serve as a lesson for the business community, public officials and others unsure about how to approach social media.

“Through all of this whole Twitter mess, I was doing what I set out to do with Doing Dexter,” she told AnnArbor.com. “What I didn’t do well was tweet about it.”

The first lesson for business people: Make sure you understand the tool before you start using it. Falzon acknowledged that she erred by launching a Twitter account without understanding the social media tool, which allows users to send 140-character updates to users who choose to follow their accounts or view the Web site version of their account.

Falzon said her voluntary resignation was “mostly” connected to the criticism over her Twitter account, although she said the chamber board never confronted her about it. The chamber board, for its part, ousted the board member in charge of overseeing Falzon and released a statement acknowledging that the Doing Dexter campaign had “gone with too little supervision."

Falzon launched the Twitter account on July 8 specifically to chronicle her efforts to shop locally and eat locally through the Doing Dexter campaign, which started Aug. 1 and will last through Oct. 1.

U.S. Chamber: We Need the Right Bill on Financial Reform

While we’re primarily focused on next week’s primary elections in this space throughout this week, the hot topic in Washington right now is financial regulatory reform. Tom Donohue, president/CEO of the U.S. Chamber of Commerce (there is no direct relationship between state chambers and the national organization, but we do work together on supporting policy that positively impacts jobs and the economy) offers a succinct commentary that provides solid suggestions for improving the legislation currently under consideration.

Financial regulatory reform is essential, and it needs to happen this year. But it’s not enough to pass any bill—we need the right bill. The rules set now will govern financial markets for years to come, impacting job creation and economic growth. At the time of this writing, a bipartisan deal may be in the works, but here are five ways we think that the current Senate legislation can be improved:

Consumer Protection—The Senate bill creates a $410 million Consumer Financial Protection Bureau with far-reaching powers—even over many nonfinancial businesses. In fact, any business that allows customers to pay in more than four installments or assesses a finance charge would be covered—even an orthodontic practice. The bill also opens the door to a new wave of lawsuits because state regulations are not preempted by new federal rules. Strong consumer protection can be better achieved through a council of regulators.

Too Big to Fail—Instead of eliminating the concept “too big to fail,” the Senate bill embraces it, ultimately designating firms as too big to fail and creating a $50 billion bailout fund. What’s needed is an orderly and predictable system—much like our current bankruptcy process—to unwind failing institutions quickly, fairly, and without taxpayer expense.

Derivatives—The Chamber agrees we need more transparency and disclosure in the multitrillion-dollar derivatives market, but there must be exemptions for businesses using the market to hedge risk on such things as exchange rates. These businesses do not threaten the stability of the financial system and should not be forced to post cash collateral that would otherwise be used to grow the business, invest, and create jobs.

Corporate Governance—Provisions in the current bill would trump state corporate governance laws—which have worked well for 150 years—in favor of one-size-fits-all federal laws. That would give labor unions and other special interest shareholders the power to leverage their agendas at the expense of other shareholders. These issues don’t belong in this bill.

Volcker Rule—While the Chamber agrees with the intent of the Volcker Rule to stabilize the financial system, its implementation would put American companies at a global disadvantage. Better tools—such as higher capital and liquidity requirements—can be used to achieve the same goal.

Financial regulatory reform is something Congress simply has to get right. The current bill needs more commonsense provisions to attract broad bipartisan support. The changes we outlined would do just that, while strengthening our capital markets, helping prevent future crises, and boosting our economy.

Ice Miller, Attorney General to Explain Impact of Health Reform on Your Company

On March 23, 2010, President Barack Obama signed into law the most sweeping health care reform legislation since the passage of Medicare and Medicaid in the mid 1960s. The Patient Protection and Affordable Care Act, as amended by the Health Care and Education Affordability Reconciliation Act (collectively, "Act"), will eventually impact nearly every employer, business, individual and health care provider in America.

The Act is over 900 pages long, and it includes some provisions that have received considerable attention, such as individual and employer mandates to obtain insurance coverage. Many other provisions have not received such attention, yet they will have a significant impact on individuals and employers. There is also a perception among some that the Act does not become effective for several years. While this is true for certain provisions, such as the excise tax on high cost health insurance plans, several other important provisions will require many employers to review and revise their employee benefit plans as early as September 2010.

It is important that Chamber members and other Indiana employers understand the many changes under the new health care reform Act and the impact these changes will have on their business. To assist in this regard, the Chamber and Ice Miller are hosting the third in a series of seminars on health care reform on April 29, 2010, at the Hilton in downtown Indianapolis.

This seminar will include presentations on the following topics:

  • Background on the Health Care Reform Debate
  • Overview of Key Parts of the Act and a Timeline for Implementation
  • Impact on Employers and Benefit Plans
  • Impact on Taxpayers and Taxes

Indiana Attorney General Greg Zoeller will discuss the litigation filed by Indiana and several other states to challenge certain aspects of the Act.  Additionally, the conference will include two panel discussions with distinguished speakers.  One panel will feature representatives from Anthem, Eli Lilly (invited), the Cook Group, the Indiana Hospital Association and the Indiana State Medical Association discussing the Act’s impact on the health care industry. The second panel discussion will focus on the Act’s impact on large and small employers and union employees and will include speakers from Fairfield Manufacturing, Womack Restaurants, and the Indiana Chamber. There will also be focus group sessions during the conference lunch on topics of interest to certain groups. Ice Miller lawyers with applicable experience will facilitate discussions and answer questions on the following topics:

  • Benefit plans, wellness programs, and other cost reduction efforts
  • Business and funding opportunities created by the new law
  • Impact on health care providers

This seminar provides a unique opportunity to learn about the sweeping changes and to hear how other individuals and businesses plan to deal with these changes. We urge you to attend.

Brinegar: Townships Still Wasting Your Money

Chamber President Kevin Brinegar explains legislators "failed to deliver meaningful local government reform" this spring, and taxpayers are feeling the brunt of it. He points to many late 2009 filings and an egregious abuse of township monies in Evansville as examples of why we need to hold legislators accountable.

There’s Nothing ‘Free’ in This ‘Choice’

Uninvited guests called on the Chamber this morning – both outside and inside the building. Why? Desperation to preserve union viability through passage of the misnamed Employee Free Choice Act (EFCA).

A handful of picketers came together on a downtown street corner for a short time, while the Chamber was conducting its EFCA seminar (for members and customers) in its conference center. The protesters were Central Indiana representatives of Jobs With Justice, a national effort focused on workers’ rights. The piece of paper they were distributing to passers-by claimed that EFCA will not eliminate so-called “secret ballot” elections and that it would “increase penalties for companies who instill fear in employees by harassing and intimidating them against the union.” Those two points are so laughable that they are not even worth addressing, but the picketers did have the right to express their opinions.
 
Inside the Chamber office, two members of the local AFL-CIO maneuvered their way into a portion of the actual seminar before they were asked to leave. They had not registered or paid the fee to attend. They were not eligible to participate – that has been clearly communicated this time and through many years of offering union-related programs. They did not have the right to “invade” an educational conference.
 
The seminar informed representatives of Indiana companies about EFCA and steps they should take if they did not:
  • want to be victim to a “card check” organizing campaign without any prior notice;
  • want their workers to be subject to coercion through card check instead of maintaining the fundamental right to a secret ballot; and
  • want to have independent government arbitrators decide how their business operates (if a union is put in place and no agreement is reached within a short time frame on an initial contract).

EFCA is bad for employers and employees. The only beneficiaries are union leaders.

 
Why has private sector employee involvement in unions declined to less than 8% nationwide? Because employers have provided open and effective communication, listened to their employees and created an atmosphere of trust. When those factors are not in place, employees may pursue union representation. The rules are in place for that to happen. Trying to artificially boost union numbers by taking away worker rights and the ability of employers and employees to negotiate contracts would be a disastrous move in the wrong direction.
 
The Indiana Prosperity Project has the details and offers you the ability to communicate your opposition to EFCA to your representatives in Washington.
 
The Indiana Chamber will host another EFCA seminar with Barnes & Thornburg in late August, featuring the most recent information. E-mail customerservice@indianachamber.com to be added to the list to receive future information about this program.