Economic Forecast: Legislative Issues
DOVER – An increase in the state’s minimum wage, the limit on microbrewery expansions and the legalization of recreational marijuana will be among the most high-profile business issues to be considered by the Delaware General Assembly starting this month.
State lawmakers will return to Legislative Hall starting on Jan. 14, with a docket of bills left over from last year’s session that either didn’t receive a vote or failed to pass either the House of Representatives or State Senate.
Perhaps the most-watched issue for the business community before the legislature this year is the push to increase Delaware’s minimum wage to $15 an hour. Delaware’s current minimum wage of $9.25 an hour lags behind several of its neighboring states amidst a time when wages are being pushed at statehouses around the country.
Both Maryland and New Jersey have an $11 an hour minimum wage as of Jan. 1, with enacted plans in both states to push to $15 an hour as early as 2024. While Pennsylvania has a $7.25 minimum wage – the federally imposed minimum – its legislature is currently considering a hike to $9.50 an hour.
Senate Bill 105 would push Delaware’s minimum wage to $15 an hour by 2024. The bill has the backing of labor unions and progressives who believe a hike is necessary to increase the standard of living for impoverished families.
But it also has its critics, including the Delaware Restaurant Association and Delaware State Chamber of Commerce, who argue the hike will disproportionately hurt small business owners, and concurrently cause those who need a wage increase to potentially lose their jobs.
Michael Quaranta, president and CEO of the state chamber, told Delaware Business Times that the wage hike would also accelerate the time in which business owners turn to artificial intelligence and technology to address workforce challenges.
As an alternative, Quaranta said his organization would be pushing for a workforce retraining program that would support participants until they received the necessary skills to earn a higher wage job.
Quaranta said there is a need in building trades, such as plumbing, electrical, carpentry, and HVAC – a byproduct of pushing a generation of students toward college rather than trades. Other sectors like health care and information technology also have a growing number of openings.
“As we often hear though, those who could most use that retraining aren’t able to do so because they can’t take time away from a job that provides for their families,” he said.
The chamber is proposing the creation of a stipend program that would support job retraining applicants for up to six months, allowing them the time to complete the ground-level training programs available through universities and nonprofits in the state.
Another issue being pursued this session will be a change in law that has limited the growth of craft brewing in the state, which is currently restricted to three brewpubs for one owner. That regulation recently caused Iron Hill Brewery to move its next location and roughly 100 jobs over the Pennsylvania line rather than settle into a desired spot near the Christiana Mall.
House Bill 158 would remove that limitation entirely, but its co-sponsors Rep. Bryan Shupe and Sen. Ernie Lopez said it faces opposition from beer distributors, delivery driver unions and large liquor store owners. In an October op-ed column published in state newspapers, Shupe and Lopez said they would make a concerted public push for the bill in 2020.
Finally, many will be eying Delaware’s debate over the legalization of recreational marijuana in 2020. House Bill 110 would add the First State to a list of 11 states that have legalized marijuana for adult use, creating a taxed, government-run industry.
While supported by marijuana advocates and those seeking criminal justice reform, the business community has not embraced the measure, Quaranta said.
“While we don’t necessarily care what people do in their free time, there is no spot test for marijuana. It is a safety, reliability and performance issue for businesses,” he said, noting the chamber would be “steadfastly opposed” until details on how prohibition of use could be enforced in the workplace were established.
Editor’s note: This story originally reported that Delaware’s minimum wage was $8.75 per hour. That is inaccurate as the minimum was increased 50 cents to $9.25 an hour as of Oct. 1, 2019. The so-called “youth and training wage,” applicable to those employees under 18 years of age and those over 18 within their first 90 days of employment, still remains $8.75/hour. We regret the error.
By Jacob Owens
DBT Associate Editor