And why is that important to everyone in the state?

Transcription

1 And why is that important to everyone in the state?

2 Only a healthy economy provides the jobs, opportunity, and quality of life that people and communities need. Only a strong business climate generates the tax revenue that enables state and local governments to provide critically needed social services. But national business climate rankings that show Connecticut unfavorably make it difficult to attract needed investment. By making fundamental changes and aggressively implementing recent initiatives to strengthen our economy, however, we can make meaningful annual progress in those rankings and be among the best states to do business within a few years. State government needs a laserlike focus on improving Connecticut s economic competitiveness to attract the private-sector investments and business activities needed to create good jobs and build healthy communities. Economic competitiveness doesn t mean being the cheapest state in which to do business, it means being the best. Connecticut can be one of the best if we nurture our strengths and address our weaknesses. Only through restoring American competitiveness [can] good jobs be created and sustained. Michael Porter, Professor, Harvard University BY 2017 WE NEED TO > > > Address Connecticut s immediate and long-term fiscal and economic issues aggressively > > Make commonsense reforms and reject efforts that won t improve our competitiveness > > Measure progress and adjust for improvement > > Reach the top 20 states, or above, in national economic and business-friendliness rankings This agenda shows how. It contains goals to be reached over the next three years and specific achievements needed in Making steady annual progress on these goals will restore business confidence in Connecticut and help us climb in the national rankings. CBIA S 2014 GOVERNMENT AFFAIRS AGENDA 1

3 Make Connecticut a Top 2O Economy by 2O17 Start Tackle the biggest challenges These include the state budget and long-term liabilities, business costs, regulatory climate, and transportation infrastructure. We also need to keep making progress in education, energy, and with the environment, and small businesses. Build Capitalize on our strengths Connecticut has diverse world-class, economic base industries including advanced manufacturing, healthcare, financial services, biotech, and others. We also have a deep and productive talent pool and an ideal location for reaching the world. Choose Adopt positive solutions State lawmakers should walk away from any legislative or regulatory proposals that won t address our challenges or improve our economy. We need to put our collective strength behind ideas that will make significant improvements. 2 CBIA S 2014 GOVERNMENT AFFAIRS AGENDA

4 Change Listen to Connecticut s people Remember that in surveys of Connecticut residents, the economy tops the lists of what concerns people most. Realize that profit-making employers are providers of good jobs, excellent benefits, and community supports. Measure Set higher performance standards We need to review progress and increase accountability in state government. We also need to align state agencies and departments, programs and services, and then communicate results. Commit Make it a priority Most important, we need to make this effort a priority throughout every aspect of state government. CBIA S 2014 GOVERNMENT AFFAIRS AGENDA 3

5 State Spending and Government Operations Fiscal responsibility is a critical factor in state economic competitiveness. > > Connecticut needs a state budget that will support critical public services and stay within taxpayers means. The budget should be balanced according to GAAP and adhere to the express intent and letter of the state s constitutional spending cap. > > State employee union contracts also must be brought in line with the private sector for pay, benefits, and work rules. > > By diligently adopting successful reforms and best practices, Connecticut will be able to deliver public services as effectively, efficiently, and innovatively as possible. Budget Outlook n Estimated expenditures (millions) n Estimated revenues (millions) $17,614.3O $17,132.5O $17,685.4O $17,524.3O $18,79o.6O $17,851.5O > > State agencies should be as customer-focused as possible and work with Connecticut businesses to help them meet their regulatory obligations. Source: OFA Data, and $19,633.4O $18,579.3O $19,377.4O FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 $2O,631.6O Expand lean practices to all of state government Implement the results of the governor s regulatory initiative Conduct a nonpartisan comparison study of pay and benefits practices in the public and private sectors Adopt recommendations of the Connecticut Institute for the 21st Century, MORE Commission, and others to control costs and improve services 4 CBIA S 2014 GOVERNMENT AFFAIRS AGENDA

6 State Tax Policy At its best, state tax policy can provide the revenue needed for public services and help unlock economic growth. Commonsense reforms, introduced over time, will increase business confidence and lead to greater job creation, business investment in the state, and entrepreneurial expansion. > > Eliminate the cap on business tax credits and extend those credits to all types of businesses, including pass-through entities. > > Make Connecticut s tax policy including the personal income tax and estate tax more competitive, consistent, and predictable to ensure fairness, effectiveness, and economic growth. > > Adopt sales tax policies that recognize the increasing impact of advanced manufacturing and the importance of investing in Connecticut s workforce. It should eliminate the sales tax on business-to-business analysis, management, and consulting services. 11% 12% 14% Greatest External Business Challenges n Taxes & regulations (41%) n Competition (21%) n Other (14%) 21% 41% n State business climate (12%) n Overall economy (11%) Source: CBIA s 2013 Survey of Family Businesses Accelerate the phaseout of the corporate tax surcharge Expand the use of tax credits for employee training Make the apportionment methodologies for limited liability companies consistent with corporations Begin to clarify the manufacturing sales tax exemptions to reflect modern lean manufacturing techniques CBIA S 2014 GOVERNMENT AFFAIRS AGENDA 5

7 Energy Connecticut has an exceptional opportunity to transform from energy-expensive state highly dependent on distant sources to a center for energy excellence where efficiency and innovation make it an increasingly attractive place to live and work. > > Significant advances in energy technologies could lead to a new energy boom to those states that become centers of energy innovation through research, development, and manufacturing. > > We need to pursue policies that will help achieve those goals, significantly lower our energy costs, and create a diverse and highly reliable network of conventional and renewable energy supplies. > > We also must transform the state s energy efficiency programs to maximize their effectiveness in helping businesses and residents achieve greater savings. MOST URGENT ACTION NEEDED Expand Access to Lower-Cost Domestic and Regional Fuel Sources Source: CBIA s 2013 Membership Survey/Top Executives Make Connecticut a full partner in the use of nearby sources of affordable, clean power such as natural gas and hydropower while maintaining a diversity of energy sources Reform, through administrative action, state energy efficiency and clean energy programs to clarify how they are benefiting the economy Create a public information tool to evaluate the impact of state energy policies on Connecticut s economic competitiveness 6 CBIA S 2014 GOVERNMENT AFFAIRS AGENDA

8 Environment Vital to making Connecticut more competitive is making the state s regulatory climate more userfriendly. > > More needs to be done to support DEEP s continuing efforts to change its culture and help businesses understand and comply with myriad environmental requirements. > > State regulations should be revised to be consistent with new or revised federal rules and policies that lighten the regulatory burden on businesses without sacrificing environmental goals. > > State cleanup laws and regulations should be modified to improve Connecticut s competitiveness as a place to invest in the redevelopment of contaminated properties and the cost-effective, beneficial use of contaminated materials. > > State policymakers should work with DEEP and the EPA to allow greater flexibility to achieve environmental compliance through innovation and cooperation. How Important for Connecticut to Improve Economic Competitiveness & National Rankings? URGENT/VERY IMPORTANT Source: CBIA s 2013 Membership Survey/ Top Executives Incorporate the governor s regulatory transparency provisions into DEEP and other state agencies Require DEEP to identify and prioritize the state s most critical environmental challenges and align its resources to meet those challenges Require DEEP to establish procedures that waive fines and penalties for certain first-time violations that do not directly impact the environment or public health Revise state hazardous waste regulations to reflect recent national changes impacting manufacturers Reject proposals that would isolate Connecticut in the regulation of chemicals CBIA S 2014 GOVERNMENT AFFAIRS AGENDA 7

9 Labor & Employment Connecticut has one of the best workforces in the nation, and its employers provide some of the best wages and benefits in the U.S. Increases in costs and mandates will make Connecticut employers less competitive. > > State unemployment compensation and workers compensation systems need to be modified to address the realities of the modern workplace and safeguard the systems sustainability against future economic downturns. > > Control costs by avoiding new burdens and mandates on employers. Make existing workplace mandates clearer and easier to administer. > > Restore business confidence in Connecticut by providing employers and their employees a level playing field within the General Assembly and within such state agencies as CHRO and the Labor Department. HOW IMPORTANT IS THE Cost of Doing Business to Compete, Succeed, and Grow in Connecticut Urgent/Very Important Source: CBIA s 2013 Membership Survey/Top Executives Adopt commonsense, low-cost reforms to the state s paid sick leave law, unemployment and workers compensation systems, and CHRO Adopt a medical fee schedule for workers compensation hospital charges Limit age discrimination claims to those at least 40 years old (similar to federal guidelines) Reject any new mandates on employers 8 CBIA S 2014 GOVERNMENT AFFAIRS AGENDA

10 Healthcare Healthcare costs are a significant burden to employers, and that impacts the state s economy. But legislators can help control healthcare costs and nurture a dynamic, private-public marketplace even as the federal Affordable Care Act brings big changes. > > Businesses thrive when their employees are healthy, and having a value-based healthcare system will compel changes that decrease costs while improving health outcomes. > > The state should focus on addressing healthcare s costdrivers. Policymakers can help people access better levels of care by reviewing and eliminating excessive health mandates and allowing flexibility and innovation in the market to ensure private competition. > > Connecticut is home to some of the brightest minds in healthcare and that in combination with prudent policy can help move us into the top 20. Economic growth and job creation provide more than...the ability to afford health insurance and medical care. They also enable us to live in safer homes and neighborhoods, buy healthier food, have more leisure time, and experience less health-harming stress. In that way, economic policy is, in fact, health policy. Risa Lavizzo-Mourey, M.D., and Mark Pinksy, A Win-Win: Job Creation Will Grow the Economy & Improve Health, The Health Care Blog, Jan Conduct a cost-benefit analysis of state health mandates; eliminate those that are not cost-justified Reject new health benefit mandates Ensure a level playing field for public and private health insurance exchanges, health plans, and other benefit providers Allow the size of provider networks to be a rate-setting factor to increase choice and access to lower-cost health insurance options CBIA S 2014 GOVERNMENT AFFAIRS AGENDA 9

11 Talent Connecticut s economy needs a steady supply of talent capable of competing in the 21st century, and all of our young people and those now working need to be prepared to take advantage of opportunities that lie ahead. > > It starts with making sure that the education reforms adopted two years ago are fully implemented. All children should be given an excellent start in their lives, including access to quality preschool education programs. YES 56% NO 29% NOT HIRING 15% > > Our skilled workforce is nationally recognized as one of Connecticut s top competitive advantages; however, much needs to be done to keep that advantage. > > We have to close the achievement gap and champion the training of good educators. Our higher education system must also be strategically aligned to fully prepare students for the workforce. Is Your Business Having Trouble Finding Qualified Workers? When businesses that are not hiring are excluded, figures are adjusted as follows: 66% are having trouble finding qualified workers; 34% are not. Source: CBIA s 2013 Survey of Connecticut Businesses Close the achievement gap and better prepare students for the 21st century economy by fully implementing the 2012 education reforms Develop quality assessment tools for preschool programs to help parents make more informed choices Adopt nationally recognized, industry-validated credentials across workforce development programs 10 CBIA S 2014 GOVERNMENT AFFAIRS AGENDA

12 Transportation Connecticut is an ideal location for competing in the global marketplace. To maximize that advantage, we must improve our transportation infrastructure in capacity, safety, and strategic interconnectedness. Transportation projects to help state s economy 3% 2% 4% 1% 6% 9% 17% 55% > > We need a seamless transportation system for commuters and commerce, all systems working together to support a growing economy. > > Identify, make, and accelerate priority investments in roads and bridges, transit systems, air and seaports. n Expand/improve highways (55%) n Expand commuter rail systems (17%) n Replace/repair deteriorating bridges (9%) n Other (6%) n Increase direct flights from Bradley International (4%) n Improve secondary roads (3%) n Provide tax incentives for telecommuting and carpooling (2%) > > Most important, stop diverting funds from the Special Transportation Fund. > > One of the most critical factors businesses weigh when deciding where to locate is a state s transportation infrastructure. Connecticut must be a location of choice because of our transportation resources. n Expand ports (2%) n Expand rail freight systems (2%) n CTfastrak busway (1%) Source: CBIA s 2013 Connecticut Transportation Survey Require DOT to use available state and federal funding to address the most highly congested highways and secondary roads first Restrict the use of the state s Special Transportation Fund to transportation purposes Increase parking and connectivity to transit services at commuter rail stations Continue to expand service at Bradley International Airport CBIA S 2014 GOVERNMENT AFFAIRS AGENDA 11

13 EACH manufacturing job creates Manufacturing ADDITIONAL jobs in other parts of the state s economy Manufacturing is not only Connecticut s heritage, it s key to our future. Connecticut manufacturers are powerful sources of economic activity and drivers of innovation. But to keep them competitive, we need a strategic plan to improve the state s manufacturing infrastructure. > > Adopt state tax policies that encourage manufacturers to increase investments in their facilities and people in Connecticut > > Continue to develop a state energy policy that ensures a diverse and highly reliable network of conventional and renewable energy supplies Source: RIMS II Mulitpliers > > Create a dependable pipeline of skilled talent to fill precision and advanced manufacturing jobs > > Improve the state s transportation infrastructure to allow the quick and efficient movement of products to state, regional, national and international markets Allow all business entities to claim tax credits, such as the research and development and apprenticeship tax credits, so that pass-through entities may continue to invest in facilities and employees Reduce from 3.5% to 1.5% the tax on disbursements from the Manufacturing Reinvestment Account Maximize the effectiveness of the state s Incumbent Worker Training Fund by using performance metrics and increasing funding Adopt nationally recognized, industry-validated credentials in all workforce development programs Clarify that high school students (age 16-18) may participate in manufacturing internships Expand access to more affordable energy; make sure energy efficiency and clean energy programs administered by utilities and the state s green bank are strongly focused on helping manufacturers Require DEEP to establish procedures that waive fines and penalties for certain first-time regulatory violations that do not directly impact the environment or public health Make it easier to transport products to market by eliminating the sales tax on product delivery charges 12 CBIA S 2014 GOVERNMENT AFFAIRS AGENDA

14 350 Church St., Hartford, CT gov.cbia.com