Governor’s Tax-Relief Package Advances in the Legislature

Three bad workers’ compensation bills finally introduced. NFIB prepares to fight them.

State Director Ronda Wiggers reports from Helena on the legislative and political week ending February 19.

The Legislature acted on most of Gov. Greg Gianforte’s Montana Comeback Plan this week, which includes:

lowering the personal income tax rate
doubling the amount of the exemption to business equipment tax
changing the way we tax corporations in Montana
removing the sale of employee-owned stock from capital gains tax.

Specifically,

SB 159 Personal Income Tax Relief Act – This bill lowers the Montana personal income tax rate from 6.9% to 6.75% and an accompanying ‘trigger’ bill (SB 182) will continue to lower the rate based on the state’s ending fund balance. SB 159 passed out of the Senate Tax Committee and will be debated on the Senate floor next week.

HB 303 the BIG Jobs Act – This measure increases the exemption on business equipment taxes from the current $100,000 to $200,000. This has passed the House and been sent over to the Senate.

HB 252 creates a non-refundable employer tax credit for employer-paid trades education passed out of House Tax and will be debated on the House floor next week.

SB 184 Montana Entrepreneur Magnet Act will exempt from the capital gains tax the sale of some employee-owned stock. The Senate Tax Committee passed this bill. It’s headed to the Senate floor for debate.

SB 181 Corporate Tax Modernization Act deals with moving from the apportionment method of taxing multi-state corporations to the sales-only method. This bill met with some opposition from existing Montana businesses at the hearing. No action was taken in committee.

Update on Other Bills NFIB is Tracking

HB 254 – Revise Wrongful Discharge act – Passed the House and was referred to the Senate Business Committee, which will likely not hear it until after the transmittal break.

HB 228 Establish the Family Medical Leave Act – This bill proposes up to a 1% payroll tax to pay for a variety of family medical leave that would then be mandatory for an employer to offer. NFIB opposed this bill, the House Business & Labor committee TABLED it.

SB 187 Increase the minimum wage – The Senate Business Committee TABLED this bill, but there are two more on the way (see below)

HB 251 Right to Work – The House Business Committee heard this bill but has taken no action.

HB 351 Revise Disability Parking Laws – This bill would make it a misdemeanor with a fine of $100 if the disabled parking space is not kept free from snow, shopping carts, etc. It was TABLED in the House Judiciary Committee.

HB 198 Revise Workers’ Comp death benefit law – Currently, if an employee dies on the job, Workers’ Compensation pays for the funeral costs, up to $4,000. As this does not cover the average cost, this bill would increase the amount to “up to $10,000” and adjust it for inflation in the future. Passed the House and has been referred to the Senate Business Committee.

SB 132 Require accommodations to employer-mandated vaccinations to be uniformly offered – The bill states that if an employer requires vaccinations but offers religious or health exemptions, he or she must allow those exemptions for all employees regardless of religion or health. This bill has passed the Senate but was TABLED in the House Business Committee. NFIB is monitoring only.

SB 91 Require fiscal notes to include business impacts – This bill has come forward in the past and NFIB has always struggled with how they would gather the business information, as it may be very different for different businesses. The bill is now amended to work with a college economics class, or something similar, to have them do the analysis. It has passed the Senate and is headed to the House.

SB 118 Revise laws related to false statements to employers and workers’ compensation – This measure has passed the Senate and was heard in the House Business Committee on Friday. The committee took no action.

New Bills of Interest to Small Business

HB 486 Providing an increase in the minimum wage – This proposes to increase the minimum wage to $10 an hour immediately and then by inflation yearly going forward. This has not yet been referred to a committee.

HB 407 Establish a statewide uniformity for auxiliary container regulations – Requested by the Restaurant Association, this bill would ban local governments from banning plastic bags, straws, Styrofoam containers, etc. It has passed out of the House Business Committee.

HB 415 Prohibit discrimination based on vaccination status – This pretty much covers every form of transportation, employment, goods, and services. It has been sent to the House Judiciary Committee but there is no hearing scheduled.

SB 289 Revise employment application by eliminating reference to criminal record – The ban-the-box bill. This is in its original form from previous sessions and does not allow exceptions for school, children-related jobs, or jobs that would place the employer in charge of teenagers or the elderly. This has been referred to the Senate Business Committee but not yet scheduled.

SB 251 Generally revise civil liability laws relating to damages – This is a tort reform bill limiting damages to a reasonable amount in bodily injury and wrongful death cases. The bill was heard on Friday in the Senate Business Committee, but the committee took no action.

Expected Workers Compensation Bills Introduced

All three of these bills have been referred to the House Business and Labor Committee. Taken together they will restrict the Montana State Fund’s financial strength, possibly to the brink of insolvency at times, and reduce State Fund’s competitiveness in the market and make their policies much more expensive and less attractive to Montana small businesses.

These bills attempt to:

eliminate dividends
add a 2.75% tax to the policies
eliminate their ability to rate plans, thus causing safe customers to see a rise in premiums
include a number of other seemingly small changes that will all have a negative effect on rates. ‘

NFIB will continue to work with other industry groups opposed to these proposals.

Hearing Schedule for the Week Ahead

Tuesday, 9 a.m. Senate Business and Labor Committee – SB 260 Generally revise related to property interest and transfer of businesses – This bill clarifies that licenses and intangibles are also a property right that needs to be compensated if taken for public purpose.

Wednesday, 8:30 a.m. House Business and Labor Committee – HB 412 Restores the right for a worker to choose a treating physician in workers’ compensation – this is the same bill from the last session. It allows doctor shopping and is very costly to workers’ compensation, thus increasing rates.

Thursday,8:30 a.m. House Business and Labor Committee – HB 284 Provide Living Wage – increases the minimum wage in Montana to $15 an hour and removes the lower minimum rate for businesses with gross sales less than $110,000. NFIB will oppose. Also scheduled HB 378 Create a mini-COBRA law for small employer health plans.

Previous Reports and Related News