Legislative Update: Bills under consideration in Olympia that could impact your business.
With Washington lawmakers past the midway point in the 2015 Legislative Session, WLA continues to work in Olympia to advance the interests of the state’s lodging industry. Our lobbying team, with support from WLA’s grassroots action network, is actively tracking bills that matter to our industry and educating legislators on the impact specific bills will have on lodging owners, operators and employees. Our members have also been active, contacting their legislators in response to our action alerts.
Close to 3,000 policy bills were introduced this year. Only those that passed out of their chamber of origin by the midterm cutoff on March 11, or have been deemed “necessary to implement the budget” (NTIB), remain under consideration by the Legislature. All together 327 bills passed off the House floor to move forward in the committee process in the Senate. 352 bills that were successful in the Senate moved to the House committee process. The session is scheduled to end April 26, although at least one special session is possible. Here is a review of key bills:
Minimum Wage Increase
The willingness of the Democrat-controlled house to pass union-backed bills is a hallmark of this legislative session. HB 1355, which would increase the minimum wage to $12 an hour over a four-year period, passed the House on a partisan 51-46 vote with all Democrats voting yes. The bill increases the minimum wage to $10.00 an hour on January 1, 2016, then to $10.50 in 2017 and $11.00 in 2018, reaching $12.00 on January 1, 2019. This represents a 27% increase from Washington’s current minimum wage of $9.47 and is 65% higher than the federal minimum wage of $7.25. The bill sets the wage for workers ages 16 to 18 at 85% of the adult minimum wage. If the bill goes into law, in 2020 the Department of Labor & Industries will resume annual minimum wage increases in accordance with the Consumer Price Index.
Speaker Frank Chopp (D-Seattle) and Governor Jay Inslee (D) lauded the bill’s passage in the House as one of the most important milestones of the session. Washington State already has the highest state minimum wage in the country, and WLA and other business groups expressed concern that the increase will cost jobs and hurt the economy, with small business, agriculture and workers entering the labor market expected to be particularly hard hit by an increase. The lack of a training wage is also expected to increase the already high youth unemployment rate. The bill was determined necessary to implement the budget (NTIB) and is continuing through the legislative process.
Paid Sick and Safe Leave
HB 1356, establishing minimum standards for paid sick and safe leave, also passed the House with the support of all 51 Democrats and uniform opposition from Republicans. It requires employers with more than four full-time equivalent employees to provide paid leave to employees for:
1. Specified medical reasons relating to an employee’s or a family member’s health.
2. Reasons permitted under existing law requiring unpaid leave for purposes related to domestic violence, sexual assault, and stalking.
3. Closure of the employee’s place of business or child’s school or place of care due to specified public health emergencies.
The paid sick and safe leave requirements do not apply to employees covered by a bona fide collective bargaining agreement in which the requirements are expressly waived in clear and unambiguous terms. While proponents of the bill argue that it promotes public health by encouraging sick workers to stay home, a recent Freedom Foundation analysis of numerous studies found that mandatory paid sick leave does not reduce the frequency of employees coming to work sick. However well intentioned, this bill will increase the cost of doing business and will ultimately hurt businesses, employees and the economy.
The Senate, with its narrow Republican majority, is less likely to pass paid sick and safe leave legislation. The bill is under consideration in its Commerce & Labor Committee.
Tourism Marketing Act
One of WLA’s legislative priorities for 2015 is the establishment of a sustainable, industry-based funding model for statewide tourism promotion that is supported by all sectors which benefit from tourism. HB 1938 and SB 5916 accomplish this by creating the Washington Tourism Marketing Authority as a public entity to manage financial resources for state tourism marketing and provide state tourism marketing services. It is funded through minimal assessments on businesses within tourism industry sectors.
WLA joins the Washington Tourism Alliance in supporting the legislation, and WLA members have contacted their lawmakers asking them to support HB 1938. The House Finance Committee held a hearing on the bill on March 20, and the date of a hearing before the Senate Ways and Means Committee has not yet been set. Look for future updates and calls to action on this important legislation.
Equal Pay for Equal Work
A bill to update Washington’s existing equal pay law picked up a few Republican votes, passed the House 55-43 and has moved to the Senate. The bill, HB 1646, establishes the Equal Pay Opportunity Act and prohibits the provision of less favorable employment opportunities based on gender. It also prohibits retaliation for certain workplace wage discussions. Although no one testified against the bill in committee, representatives of the Association of Washington Businesses and Washington Policy Center are concerned that the bill would be burdensome for employers and lead to more litigation.
Under Washington’s current liquor distribution system, retailers are assessed a 17% fee for selling to bars and restaurants. HB 1343 and its Senate companion bill SB 5301 eliminate this fee which is particularly onerous for hotel bars and restaurants that typically maintain smaller liquor inventories and restock on short notice from retailers. Although the bills appear to have died at the cut off, both were declared NTIB and remain under consideration.
SB 5880, a bill to establish the Washington Human Trafficking Reporting Act, would have required the development and implementation of a mandatory training program to teach employees to identify and report human trafficking victims. WLA is very concerned about human trafficking and has helped develop partnerships and practices to prevent this crime through voluntary training. The bill as written, however, is problematic for the industry. It failed to pass the Senate Law and Justice Committee and is expected to be worked on and reconsidered next session.
In response to business concerns about harassment and inappropriate behavior by representatives of music licensing agencies, HB 1763 requires these agencies to register to conduct business in Washington, prohibits coercive conduct and other inappropriate behavior and establishes penalties including making violation of this act a violation of the Consumer Protection Act. It passed the House 92-6 and is expected to move forward in the Senate.
Tax Exemption for Hostels
HB 1516 provides an exemption from the convention and trade center tax for hostels that primarily sell lodging services on an individual bed, shared room basis. The bill also prevents public facilities districts in King County from levying the state-shared hotel- motel tax on sales of lodging at hostels. It passed the House unanimously.
HB 1551, which is intended to add clarity and efficiency to the administration of unclaimed property, unanimously passed the House. It replaces the current 100% penalty for willful failure to file an unclaimed property report with a revised penalty structure that imposes a 10 percent penalty for failure to file a report or pay or deliver property under a report. Although the companion bill, SB 5543, passed the Senate policy committee, HB 1551 did not move out of the Senate Ways and Means Committee.
WLA and our lobbyist, TK Bentler, are tracking these bills and educating legislators on the impact they will have on lodging owners, operators and employees. Please look for calls to action and contact your legislators when asked so that we can deliver wins for the industry.
For more information on WLA’s advocacy work, please contact Stan Bowman by email here or at 206-306-1001.