Northern Virginia Chamber Partnership

 NORTHERN VIRGINIA CHAMBER PARTNERSHIP

Week 4 Session Update on Partnership Priorities

January 30, 2020

The following status report on the Partnership’s priorities at this point in the 2020 session.

Protect Virginia’s right-to-work law. The Partnership continues to fight efforts to repeal or weaken Virginia’s right-to-work law. There are two bills that are the focus of our efforts on this issue.

• SB 426 (Saslaw) – This bill would authorize an employer to require, as a condition of employment, that any employee who is not a member of a labor union and is a member of a collective bargaining unit to pay a “fair share fee” to compensate the labor union for the costs of representing the non-member employee. This bill is expected to be considered by the Senate Commerce and Labor Committee on Monday, February 3.

Thanks to all who have contacted Sen. Saslaw and members of the Senate Commerce and Labor to express opposition to this bill to date. Per the advocacy alert message sent earlier today, at this point, we are continuing to focus on urging Senate Democrats on this committee, as well as those on the Senate Finance and Appropriations Committee, to vote NO on this bill.

• HB 153 (Carter) – This bill would repeal Virginia’s right-to-work law. Since last week’s report, this has been assigned to a subcommittee of the House Labor and Commerce Committee, which will meet on Tuesday, February 4. While we believe there is sufficient support, at the very least in the Senate, to defeat a full repeal of the right-to-work law, there is some concern that this bill may be amended to mirror Sen. Saslaw’s fair share bill. In addition to opposing this bill when it is considered next week, we will also watch for possible amendments that would otherwise weaken the right-to-work statute. For those who would like to express opposition to this bill when considered in subcommittee, contact information for the members can be found here.

Support policies that increase access to affordable housing. The Partnership continues its strong support for policies that increase the availability of a wide range of housing options to meet the needs of the Northern Virginia workforce. Below is a quick report on the status of the bills the Partnership is supporting on this issue.

• HB 810 (Bourne) – Virginia Housing Opportunity Tax Credit Program – This legislation was passed in the House by a vote of 83Y-16N and will now be considered in the Senate General Laws Committee.
• HJ 2 (Bourne) – Tax Abatement for New Construction Affordable Housing – This has not yet been heard by the House Rules Committee.
• HB 1101 (Carr)/SB 834 (McClellan) – Affordable Dwelling Unit Ordinance Policy – SB 834 was passed by the Senate on a vote of 27Y-12N. HB 1101 was recommended by the House Counties, Cities and Towns Land Use Subcommittee by a vote of 7-0 and it will now be considered by the full committee.
• HB 929 (Jones/Coyner) – Right-of-Way Dedications – The Counties Cities and Towns Land Use Committee recommended reporting this bill by a vote of 7-0 and it will now be considered in the full committee.

The Partnership will also support budget items that help to increase access to affordable housing in Virginia.

Protect against unreasonable mandated employee benefits. As Virginia seeks to maintain its economic growth and steady job creation, the Partnership is fighting bills that interfere with the employer/employee relationship, including mandates related to paid family and medical leave.

There are two primary types of bills related to mandated employee benefits being considered by the legislature this session. One would establish a government-run Paid Family and Medical Leave Program. These bills include:

• SB 770 (Boysko) — Paid family and medical leave program. Requires the Virginia Employment Commission to establish and administer a paid family and medical leave program with benefits beginning January 1, 2023. Under the program, benefits are paid to eligible employees for family and medical leave. Funding for the program is provided through premiums assessed to employers and employees beginning in 2022. The amount of a benefit is 80 percent of the employee’s average weekly wage, not to exceed 80 percent of the state weekly wage, which amount is required to be adjusted annually to reflect changes in the statewide average weekly wage. The measure caps the duration of paid leave at 12 weeks in any application year. The bill provides self-employed individuals the option of participating in the program. This bill has not yet been heard by the Senate Finance and Appropriations Committee.
• HB 825 (Carroll Foy) — Paid family and medical leave program. Requires the Virginia Employment Commission to establish and administer a paid family and medical leave program with benefits beginning January 1, 2023. Under the program, benefits are paid to eligible employees for family and medical leave. Funding for the program is provided through premiums assessed to employers and employees beginning in 2022. The amount of a benefit is 80 percent of the employee’s average weekly wage, not to exceed 80 percent of the state weekly wage, which amount is required to be adjusted annually to reflect changes in the statewide average weekly wage. The measure caps the duration of paid leave at 12 weeks in any application year. The bill provides self-employed individuals the option of participating in the program. This bill was passed by the House Labor and Commerce Committee by a vote of 11Y-7N and was referred to the Appropriations Committee.
• HB 328 (Levine) — Family and Medical Leave Insurance Program. Entitles individuals to a family and medical leave insurance (FMLI) benefit payment for each month they are engaged in qualified caregiving, not to exceed 60 qualified caregiving days per year. Qualified caregiving means an activity, except regular employment, for a reason an individual is entitled to leave under the federal Family and Medical Leave Act of 1993. Benefits would amount to 66 percent of an individual’s monthly wages, based on highest annual earnings from the prior three years, up to a capped monthly amount, and would be indexed to the national average wage index. If a person takes the maximum number of days, the benefits would range from a minimum benefit of $580 to a maximum benefit of $4,000 per month in the program’s first year. To be eligible for benefits, an individual is required to (i) be insured for disability insurance benefits under the Social Security Act at the time his application is filed; (ii) have earned income from employment during the 12 months before filing the application; (iii) have filed an application for a FMLI benefit; and (iv) have been engaged in qualified caregiving, or anticipate being so engaged, during the 90-day period before the application is filed or within 30 days thereafter. The measure establishes the Family and Medical Leave Insurance Fund and requires FMLI benefit payments to be made only from this Fund. A tax of 0.2 percent is imposed on the wages received by every individual, and an excise tax of 0.2 percent of the wages paid in any calendar year by the employer with respect to their employment is imposed on employers. The measure has a delayed effective date of January 1, 2021. This bill was passed by the House Labor and Committee by a vote of 12Y-9N and was referred to the House Appropriations Committee

In addition, there are a number of bills that have been introduced related to earned sick leave. These are listed below:

• HB 898 (Guzman) — Earned paid sick time. Requires public and private employers with six or more employees to provide those employees with earned paid sick time. The measure provides for an employee to earn at least one hour of paid sick leave benefit for every 30 hours worked. An employee shall not use more than 40 hours of earned paid sick time in a year, unless the employer selects a higher limit. Employees shall not be entitled to use accrued earned paid sick time until the ninetieth calendar day following commencement of their employment, unless otherwise permitted by the employer. The bill provides that earned paid sick time may be used (i) for an employee’s mental or physical illness, injury, or health condition; an employee’s need for medical diagnosis, care, or treatment of a mental or physical illness, injury, or health condition; or an employee’s need for preventive medical care; (ii) to provide care to a family member under similar circumstances; (iii) when there is a closure of the employee’s place of business or the employee’s child’s school or place of care due to a public health emergency; or (iv) when an employee’s or employee’s family member’s presence in the community may jeopardize the health of others because of their exposure to a communicable disease. The bill authorizes the Commissioner of Labor and Industry, in the case of a knowing violation, to subject an employer to a civil penalty not to exceed $150 for the first violation, $300 for the second violation, and $500 for each successive violation, if the second or successive violation occurs within two years of the previous violation. The Commissioner of Labor and Industry may institute proceedings on behalf of an employee to enforce compliance with this measure and to collect specified amounts from the employer, which shall be awarded to the employee. Alternatively, an aggrieved employee is authorized to bring a civil action against the employer in which he may recover double the amount of any unpaid earned sick time and the amount of any actual damages suffered as the result of the employer’s violation. The measure has a delayed effective date of January 1, 2021. HB 418 (Cole, J.) and HB 1684 (Sickles) were incorporated into this bill. This bill was recommended by a House Labor and Commerce subcommittee by a vote of 4Y-3N and will be considered by the full committee next week.
  
• SB 481 (Favola) — Earned paid sick time. Requires public and private employers with six or more employees to provide those employees with earned paid sick time. The measure provides for an employee to earn at least one hour of paid sick leave benefit for every 30 hours worked. An employee shall not use more than 40 hours of earned paid sick time in a year, unless the employer selects a higher limit. Employees shall not be entitled to use accrued earned paid sick time until the ninetieth calendar day following commencement of their employment, unless otherwise permitted by the employer. The bill provides that earned paid sick time may be used (i) for an employee’s mental or physical illness, injury, or health condition; an employee’s need for medical diagnosis, care, or treatment of a mental or physical illness, injury, or health condition; or an employee’s need for preventive medical care; (ii) to provide care to a family member under similar circumstances; (iii) when there is a closure of the employee’s place of business or the employee’s child’s school or place of care due to a public health emergency; or (iv) when an employee’s or employee’s family member’s presence in the community may jeopardize the health of others because of their exposure to a communicable disease. The bill authorizes the Commissioner of Labor and Industry, in the case of a knowing violation, to subject an employer to a civil penalty not to exceed $150 for the first violation, $300 for the second violation, and $500 for each successive violation, if the second or successive violation occurs within two years of the previous violation. The Commissioner of Labor and Industry may institute proceedings on behalf of an employee to enforce compliance with this measure and to collect specified amounts from the employer, which shall be awarded to the employee. Alternatively, an aggrieved employee is authorized to bring a civil action against the employer in which he may recover double the amount of any unpaid earned sick time and the amount of any actual damages suffered as the result of the employer’s violation. The measure has a delayed effective date of January 1, 2021. This bill is in the Senate Commerce and Labor Committee.
  
• SB 1069 (Barker) — Earned paid sick time. Requires public and private employers with 25 or more employees to provide those employees with earned paid sick time. The measure provides for an employee to earn at least one hour of paid sick leave benefit for every 30 hours worked. An employee shall not use more than 40 hours of earned paid sick time in a year, unless the employer selects a higher limit. Employees shall not be entitled to use accrued earned paid sick time until the ninetieth calendar day following commencement of their employment, unless otherwise permitted by the employer. The bill provides that earned paid sick time may be used (i) for an employee’s mental or physical illness, injury, or health condition; an employee’s need for medical diagnosis, care, or treatment of a mental or physical illness, injury, or health condition; or an employee’s need for preventive medical care; (ii) to provide care to a family member under similar circumstances; (iii) when there is a closure of the employee’s place of business or the employee’s child’s school or place of care due to a public health emergency; or (iv) when an employee’s or employee’s family member’s presence in the community may jeopardize the health of others because of their exposure to a communicable disease. The bill authorizes the Commissioner of Labor and Industry, in the case of a knowing violation, to subject an employer to a civil penalty not to exceed $150 for the first violation, $300 for the second violation, and $500 for each successive violation, if the second or successive violation occurs within two years of the previous violation. The Commissioner of Labor and Industry may institute proceedings on behalf of an employee to enforce compliance with this measure and to collect specified amounts from the employer, which shall be awarded to the employee. Alternatively, an aggrieved employee is authorized to bring a civil action against the employer in which he may recover double the amount of any unpaid earned sick time and the amount of any actual damages suffered as the result of the employer’s violation. The measure also prohibits an employer of any size from discharging an employee for taking unpaid absences totaling more than 16 hours in a year for a purpose described in clauses (i) through (iv). The measure has a delayed effective date of January 1, 2021. This bill is in the Senate Commerce and Labor Committee.

Among the major issues in play related to these bills is the size of those businesses that would be required to comply. The House bills would require any business with six or more employees to comply with these mandates, while SB 1069 would only require compliance for businesses that have 25 or more employees. We are pushing to carry the bill over to provide more time to work on it in the off session, but if something does seem likely to pass this session, we are urging use of the highest employee count we can get to minimize the impact on small businesses.

Support continued access to affordable, efficient reliable energy. Reliable and affordable energy is the critical base that supports the quality of life and economic opportunity for all Virginians. Virginia’s residents and businesses have benefitted from energy costs that have been below the national average for years, thanks largely to our diverse and abundant sources of power (U.S. Energy Information Administration).  Our electricity generation relies heavily on natural gas (57%) and nuclear (30%) with a growing reliance on renewables (7%) and a diminished emphasis on coal (4%).

Energy costs have dropped to the lowest share of household spending since 2007.  From 2007 – 2017, household spending on energy decreased by 10.5%.  During this same period, health care costs increased by 72%, education costs by 57% and food purchases by 26% (U.S. Bureau of Labor Statistics).

Low and competitive energy costs are a significant factor in the growth of Virginia’s economy.  As businesses evaluate opportunities to form and expand, Virginia’s affordable and reliable energy is an important advantage in our ability to compete for economic development and to grow our economy.  As Virginia works to rebuild its manufacturing base with good high-paying jobs for Virginians, it is critical that we maintain our diverse energy sources.

As policymakers seek to address concerns about climate change, it is critical that steps toward increased reliance on renewable energy maintain a balance in our energy sources so that energy for Virginians remains affordable and reliable.  Solar and wind power are intermittent sources of energy, generating power only when the sun is shining, and the wind is blowing and therefore, need to be supported with nuclear energy, natural gas and other fossil fuels.

To meet today’s and tomorrow’s energy needs, an “all-of-the-above” approach is needed, including wind, solar, hydro, fossil fuels, conservation and efficiency, and construction of new electric generation facilities and new energy transmission and distribution infrastructure.  The right balance of these energy sources and delivery infrastructure will affect Virginia’s competitiveness and the quality of life and opportunity for residents and businesses.

For all these reasons, the Partnership chose to include protection against harmful energy policy as one of its top priorities. We are actively opposing a number of bills this session that would undo the needed balance of energy sources and result in higher costs for Virginia residents and businesses, reduce our ability to achieve economic development goals, and may reduce the reliability of our energy supply. This includes bills that propose participation in the Regional Greenhouse Gas Initiative (RGGI) and the elimination of fossil fuel energy through a Virginia Green New Deal.  Overviews of these bills are included below.

Bills related to the RGGI

• HB 20 (Lindsey) — Virginia Alternative Energy and Coastal Protection Act. Directs the Department of Environmental Quality to implement the final carbon trading regulation as approved by the State Air Pollution Control Board in order to establish a carbon dioxide cap and trade program that limits and reduces the total carbon dioxide emissions released by electric generation facilities and that complies with the Regional Greenhouse Gas Initiative model rule. The Partnership OPPOSES this bill, which will be considered in a subcommittee of the House Labor and Commerce Committee.
• HB 981 (Herring) — Clean Energy and Community Flood Preparedness Act; fund. Directs the Department of Environmental Quality to incorporate into regulations previously adopted by the State Air Pollution Control Board certain provisions establishing a carbon dioxide cap and trade program to reduce emissions released by electric generation facilities. Such provisions are required to comply with the Regional Greenhouse Gas Initiative model rule. The bill authorizes the Director of the Department of Environmental Quality to establish, implement, and manage an auction program to sell allowances into a market-based trading program. The bill requires revenues from the sale of carbon allowances, to the extent permitted by Article X, Section 7 of the Constitution of Virginia, to be deposited in an interest-bearing account and to be distributed without further appropriation (i) to the Virginia Community Flood Preparedness Fund, (ii) to the Department of Mines, Minerals and Energy for low-income energy efficiency programs, (iii) for administrative expenses, and (iii) for statewide climate change planning and mitigation activities. The bill continues the Virginia Shoreline Resiliency Fund as the Virginia Community Flood Preparedness Fund for the purpose of creating a low-interest loan program to help inland and coastal communities that are subject to recurrent flooding. HB 1152 (Lopez) was incorporated into this bill. A subcommittee of the House Labor and Commerce committee recommended reporting this bill.

Bills related to the Green New Deal

• HB 77 (Rasoul) — Fossil fuel projects moratorium; clean energy mandates; civil penalties; Green New Deal Act. Establishes a moratorium, effective January 1, 2021, on approval by any state agency or political subdivision of any approval required for (i) electric generating facilities that generate fossil fuel energy through the combustion of a fossil fuel resource; (ii) import or export terminals for fossil fuel resources; (iii) certain maintenance activities relating to an import or export terminal for a fossil fuel resource; (iv) gathering lines or pipelines for the transport of any fossil fuel resource that requires the use of eminent domain on private property; (v) certain maintenance activities relating to such gathering lines or pipelines; (vi) refineries of a fossil fuel resource; and (vii) exploration for any type of fossil fuel, unless preempted by applicable federal law. The Partnership OPPOSES this bill, which will be considered in a subcommittee of the House Labor and Commerce Committee.
• HB 1295 (Helmer) — Tax on fossil fuel investments by electric utilities. Imposes a tax on investor-owned electric utilities and electric cooperatives based on the amount that the utility invests in a year on fossil fuel infrastructure. The rate of the tax starts at 2.5 percent of the amount of a utility’s fossil fuel investments in 2021 and increases in annual increments thereafter until reaching 100 percent in 2040 and thereafter. The Partnership OPPOSES this bill, which will be considered in a subcommittee of the House Finance Committee.
• HB 1526 (Sullivan) — Electric utility regulation; environmental goals. Replaces the existing voluntary renewable energy portfolio system (RPS) program with a mandatory RPS that applies to electric utilities and licensed competitive suppliers. Under the mandatory RPS, utilities and suppliers are required to produce their electricity from 100 percent renewable sources by 2050, with annual steps that direct the electricity be generated in specific percentages in nine tiers or sub-tiers. A utility or supplier that does not meet its targets is required to pay a specific deficiency payment or purchase renewable energy certificates. The Partnership OPPOSES this bill, which will be considered in a subcommittee of the House Labor and Commerce Committee.

The consensus energy-related bill that is advancing this session is SB 95 (Favola). This bill is focused on development of an energy plan for Virginia that provides “guidance” rather than implementation of mandatory standards or requirements in the code at this time. The bill states that the Commonwealth Energy Policy shall:

• Establish greenhouse gas emissions reduction standards across all sectors of Virginia’s economy that target net zero carbon emissions by 2050
• Enact mandatory clean energy standards and overall strategies for reaching zero carbon in the electric power sector by 2040
• Incorporate requirements for technical, policy, and economic analyses and assessments that identify pathways to zero carbon that maximize Virginia’s economic development and create quality jobs
• Minimize the negative impacts of climate change and the energy transition on disadvantaged communities and prioritizing investment in these areas.

The measure requires the Virginia Energy Plan to be prepared in consultation with a stakeholder group that includes representatives of consumer and environmental organizations, and requires that the Virginia Energy Plan identify actions over a 10-year period consistent with the goal of the Commonwealth Energy Policy to achieve, no later than 2050, a net-zero carbon energy economy for all sectors, including electricity, transportation, building, and industrial sectors.

For those interested in the specific details in this legislation, that is provided below.

Specifically, the bill updates the energy plan components to include the following (new items highlighted in yellow):

• Support research and development of, and promote the use of, renewable energy sources
• Ensure that the combination of energy supplies and energy-saving systems are sufficient to support the demands of economic growth
• Promote cost-effective conservation of energy and fuel supplies
• Ensure the adequate supply of natural gas necessary to ensure the reliability of the electricity supply and the needs of businesses during the transition to renewable energy
• Promote the generation of electricity through technologies that do not contribute to greenhouse gases and global warming
• Promote the use of motor vehicles that utilize alternate fuels and are highly energy efficient
• Support efforts to reduce the demand for imported petroleum by developing alternative technologies, including but not limited to the production of synthetic and hydrogen-based fuels, and the infrastructure required for the widespread implementation of such technologies
• Ensure that development of new, or expansion of existing, energy resources or facilities does not have a disproportionate adverse impact on economically disadvantaged or minority communities
• Establish greenhouse gas emissions reduction standards across all sectors of Virginia’s economy that target net-zero emissions carbon by 2045
• Enact mandatory clean energy standards and overall strategies for reaching net-zero carbon in the electric power sector by 2040
• Equitably incorporate requirements for technical, policy, and economic analyses and assessments that recognize the unique attributes of different energy resources and delivery systems to identify pathways to net-zero carbon that maximize Virginia’s energy reliability and resilience, economic development, and jobs
• Minimize the negative impacts of climate change and the energy transition on economically disadvantaged or minority communities and prioritize investment in these areas.

In the development of the Virginia Energy Plan, the bill further directs the Division, the State Corporation Commission, the Department of Environmental Quality, the Clean Energy Advisory Board, solar, wind, and energy efficiency sectors, and a stakeholder group that shall include representatives of consumer, environmental, manufacturing, and agricultural organizations and electric utilities to work together to develop the plan.

It requires that the plan include the following:

• Projections of energy consumption in the Commonwealth, including the use of fuel sources and costs of electricity, natural gas, gasoline, coal, renewable resources, and other forms of non-greenhouse-gas-generating energy resources, such as nuclear power, used in the Commonwealth
• An analysis of the adequacy of electricity generation, transmission, and distribution resources in the Commonwealth for the natural gas and electric industries, and how distributed energy resources and regional generation, transmission, and distribution resources affect the Commonwealth
• An analysis of siting requirements for electric generation resources and natural gas and electric transmission and distribution resources, including an assessment of state and local impediments to expanded use of distributed resources and recommendations to reduce or eliminate these impediments
• An analysis of fuel diversity for electricity generation, recognizing the importance of flexibility in meeting future capacity needs
• An analysis of the efficient use of energy resources and conservation initiatives
• An analysis of how these Virginia-specific issues relate to regional initiatives to assure the adequacy of fuel production, generation, transmission, and distribution assets
• An analysis of siting of energy resource development, refining or transmission facilities to identify any disproportionate adverse impact of such activities on economically disadvantaged or minority communities
• With regard to any regulations proposed or promulgated by the U.S. Environmental Protection Agency to reduce carbon dioxide emissions from fossil fuel-fired electric generating units under the Clean Air Act, an analysis of:
  • The costs to and benefits for energy producers and electric utility customers
  • The effect on energy markets and reliability
  • The commercial availability of technology required to comply with such regulations
• An inventory of greenhouse gas emissions using a method determined by the Department of Environmental Quality for the four years prior to the issuance of the Plan and projections for the greenhouse gas emissions that would result from the implementation of the Plan’s proposed actions
• Recommendations for legislative, regulatory, and other public and private actions to implement the elements of the Commonwealth Energy Policy.

Once again, it is important to note that this legislation makes it clear that the Commonwealth Energy Policy is intended to provide guidance to the agencies and political subdivisions in Virginia in taking action with regard to energy issues and does not “amend, repeal or override and contrary provision of applicable law.”  This bill was passed by the Senate on a vote of 21Y-18N and will now be considered in the House.