Chamber Chats: Fall Session Priorities

Lawmakers return to Harrisburg later this month, and the PA Chamber is excited to continue promoting bipartisan, pro-business solutions we are championing to make Pennsylvania a more competitive state for business.

For the latest edition of Chamber Chats, the PA Chamber’s Lindsay Andrews caught up with our Vice President of Government Affairs, Alex Halper, to discuss the organization’s top policy priorities as his team gears up for start of the fall session. A minimally revised transcript of their conversation is below.

(Click to view video)

 

We have had a good start to 2023 and some of the things that got done in the budget. Can you talk to us a little bit about what was achieved on behalf of business and what we would like to see coming up in the fall?

AH: Yeah, we have made some real progress on getting some of the top Chamber priorities as part of the legislative agenda – the priorities that lawmakers, that the governor are talking about.

Things like improving Pennsylvania’s tax code. We had tremendous progress last session to make Pennsylvania more competitive as it relates to business taxes, but a lot more work to do and we have a real opportunity this year, this session, and this fall to make more progress.

What can you tell us about the specifics of that progress? What would you like to see get done?

AH: Last year, for the first time in decades, Pennsylvania reduced its corporate net income tax rate. And we needed to because we had the second-highest rate in the country.

The problem is, while we did that, other states are making pro-business, pro-growth tax reform as well, and Pennsylvania is just not keeping up. Governor Shapiro, when he was running for office, talked about reducing those tax rates more quickly, and expediting those reductions.

We thought that was a great idea; we supported the governor’s call for expediting the reduction of the corporate tax rate. There is legislation in both the House and Senate to do that, and we are going to keep pushing to get that done.

What about the treatment of net operating losses? What can you tell us about that? I know that has been a long-term goal for the business community.

AH: Pennsylvania unfortunately puts itself at a great disadvantage as it relates to net operating losses. That basically means that for businesses that experience losses – they lose money in a year – they are often able to use those losses to offset profits in a future year. Of course, our goal for all businesses is to make a profit but a lot of times, you might have a startup company where they are investing in capital, into people, and they are losing a lot of money.

The tax code, both at the federal and the state level, allows companies to offset those losses and reinvest in their company. Pennsylvania, though, does not treat those losses nearly as favorably as practically every other state in the country.

We basically impose a tax on startup companies, which is the last thing we want to be doing if our goal is to make Pennsylvania the most competitive state in the country and attract new, innovative businesses.

There is legislation, again, in both the Senate and the House, that would make Pennsylvania at least on par with other states for how it treats these losses. This bill passed unanimously out of the Senate Finance Committee earlier this session, and we are working with lawmakers on both sides of the aisle – with the House and Senate and the Governor’s Office – to keep that legislation advancing and hopefully get it done.

Moving on to workforce development because I know that is huge for us. A good, strong, bipartisan issue and I know that we took the lead in the first-of-its-kind Clean Slate legislation, what is next for that? What is next for workforce development in the fall?

AH: It is a challenging issue. Employers continue to struggle finding people to fill open positions. There are many, many reasons why the labor market is so tight, and that means we need to have many, many solutions to address this challenge.

You mentioned Clean Slate, which is about helping to encourage Pennsylvanians who have a criminal record or are recently incarcerated, trying to encourage them back into the workforce. That needs to continue to be a priority. We are supporting legislation that would build on Clean Slate, which provides for  automatic expungement of certain lower-level, non-violent offenses.

Similar to Clean Slate, there are efforts to reform Pennsylvania’s probation systems, and we have advocated for some employment-specific reforms to probation.

Things like that—there are no silver bullets to solving Pennsylvania’s and the nation’s workforce crisis. But these are some specific solutions that we think will help a lot of Pennsylvanians but also a lot of Pennsylvania employers.

I also know that permitting reform is critical and an important issue for employers wanting to come to the state. What can you tell us about what is being done to streamline our permitting process and attract business and jobs to Pennsylvania?

AH: It simply takes too long, it is too complicated, and there is not enough transparency in the system of applying for and receiving state permits for projects—if you are looking to expand your facility, for example.

Legislation passed the state Senate earlier this year with bipartisan support to improve those systems, create more efficiency and more transparency. Employers want to know how long it is going to take and how and when to make key investments. This is not about cutting corners as it relates to environmental regulations, this is about understanding and having uniformity with the process and transparency.

This legislation is now pending in the state House, we think it would go a long way toward improving permitting in Pennsylvania and again something we are hoping will continue to advance this fall session.

This is something that has the support of business and lawmakers on both sides of the aisle as well as the Shapiro administration.

AH: That is true. One of the first actions that Gov. Shapiro took upon taking office was issuing an executive order to improve permitting in Pennsylvania. Part of this legislation would codify Gov. Shapiro’s executive order so that it exists in Pennsylvania law long after his tenure as governor is completed. We think there are some very good ideas in there and we look forward to continuing to work with a broad coalition to make this happen.


 

For more information on these issues, please visit the On the Hill section of our website.

Pa. House panel examines consumer data privacy bill

Legislation to protect consumer data privacy drew mixed views from businesses and business groups Wednesday during an information-gathering meeting before a House committee.

The Commerce Committee looked at House Bill 1201 aimed at protecting consumers’ digital privacy, allowing them to access their personal information that’s been collected, giving them legal rights to decline or opt out of the sale of their personal information and banning the sale of all private information for consumers under age 16.

HB1201 sponsored by Rep. Ed Neilson, D-Philadelphia, would give the state attorney general authority to enforce a digital privacy law.

The committee heard from four business-oriented groups and received written testimony.

The opening testifier, Jay Summerson, a Microsoft executive, said his firm supports HB1201 because it provides strong consumer rights, lets consumers opt out of intrusive data collection, places obligations on companies to be better stewards of consumer data and puts sole authority for law enforcement in the hands of the attorney general.

Committee Majority Chairman John Galloway, D-Bucks, asked how far can state lawmakers go in regulating this matter. He said the committee plans to form a working group on the issue.

“In an ideal world, this would be a federal solution,” said Mr. Summerson, adding he’s not aware of any challenges to a state’s authority to deal with this issue.

Tim Knapp, counsel for Insurance Federation of Pennsylvania, said the federation supports the bill concept, but added the insurance industry wants an exemption from it because they are already regulated by federal and state laws regarding sharing any consumer information.

“We are a very heavily regulated industry,” said Mr. Knapp.

This issue affects the personalization of the shopping experience, said John Holub, executive director for the Pennsylvania Retailers Association. He said the association generally supports the legislation because it protects retailer’s ability to provide discounts offered through consumer loyalty programs.

“We strongly support enforcement by the attorney general,” said Mr. Holub.

Mr. Holub said the bill’s exemption for small businesses that process less than 50,000 transactions annually is a low threshold and should be higher.

In written testimony, the Pennsylvania Chamber of Business and Industry said it would prefer a federal law addressing this topic, but acknowledged that Congress has yet to act.

Chamber executive Alex Halper said any state law on consumer data privacy should recognize that employers may struggle to interpret the law and provide an opportunity for missteps to be corrected, draw a distinction between consumer data and standard personal data that employers collect from employees and recognize that some personal data is important to societal goals from public safety to improving medicine and health among other objectives.

Sens. Maria Collett, D-Montgomery and Lisa Boscola, D-Northampton, have sponsored a companion bill in the Senate.

PA Chamber Testifies Before U.S. Senate Panel on Environmental Regulations

HARRISBURG – Today, Pennsylvania Chamber of Business and Industry Director of Government Affairs Kevin Sunday testified before the United States Senate Committee on Environment and Public Works Subcommittee on Chemical Safety, Waste Management, Environmental Justice, and Regulatory Oversight. The hearing, entitled “The Impacts of Plastics Production and Disposal on Environmental Justice Communities,” explored the balance between commerce and conservation.

 

In his testimony, Sunday highlighted the importance of enacting public policy that expands opportunities for all citizens and advances sustainability while supporting economic growth. He emphasized the regressive nature of high energy prices on vulnerable communities and the paramount need for domestic energy development as a means to combat energy poverty.

Sunday outlined Pennsylvania’s significant contributions as a leading producer of energy, electricity, gas, construction materials, food, medicine, and life-sustaining products. He also noted the ongoing efforts in the Commonwealth to establish a circular economy that minimizes water and plastics waste.

“The abundant natural resources of our state have led this country through every major energy transition that has occurred in the past 165 years,” Sunday said.

Sunday stressed the importance of a robust and reliable supply of energy and life-sustaining products, as underscored by the pandemic and recent supply chain shocks. He urged policymakers to consider the economic and environmental benefits of Pennsylvania’s energy and plastics industries, which support over $24 billion in annual economic output and 55,000 jobs, and cautioned against pursuing measures that would constrain this vital sector.

“Limiting domestic output of this industry will produce negative economic and environmental costs and impacts, from raising the cost of goods and services for working families and sending more jobs overseas, to increasing global emissions and an increase in the amount of waste sent to landfills,” Sunday said.

Sunday emphasized the desire for job creation in environmental justice communities and the negative public health consequences of high unemployment. “One of the key criteria in defining an environmental justice community is the percentage of households or individuals in poverty,” Sunday said. “These communities want jobs.”

Sunday also underscored the importance of the state’s plastics and petrochemical industries in manufacturing goods including medical devices, products, vaccines, ammonia, and fertilizer. He highlighted progress in reducing greenhouse gas emissions and the significant energy savings achieved through manufacturing goods from recycled materials. Sunday stressed that plastics remain essential in taking advantage of renewable technologies and reducing emissions.

“Plastics play a key role in renewable technologies and batteries – from light-weighting automobiles to composite components of wind turbines and solar panels, so it is all the more important that we develop strategies for their responsible use and recycling,” Sunday said.

Pennsylvania’s approach to environmental justice, according to Sunday, ensures public participation from impacted communities and produces durable permitting decisions. He urged policymakers to define clear standards that promote fairness and allow communities to thrive.

“As state and federal regulators and legislators define policy goals with respect to environmental justice, the implementation of these goals must come through clearly articulated, objective regulatory standards, established by statute and through a rulemaking process, that are applied fairly and without excessive conditioning of permits and processes.”

The PA Chamber of Business and Industry strongly supports legislative efforts to drive meaningful permitting reform and increase investment in the industry. Sunday acknowledged the bipartisan leadership of Committee Chairman Tom Carper (D-DE) and Ranking Member Shelley Moore Capito (R-WV) and their commitment to enacting permitting reforms.

Sunday maintained that Pennsylvania’s chemicals, manufacturing, and recycling sectors play a crucial role in fostering inclusive and sustainable growth. He cited examples of ongoing projects, such as the International Recycling Group’s zero landfill plastics recycling facility in Erie, Monroe Energy’s refinery in Delaware County, and Shell’s polymers manufacturing facility in southwestern Pennsylvania. These projects not only support economic development but also empower local communities through responsible environmental practices.

“We encourage a balanced discussion that recognizes the important economic benefit of our state’s energy, manufacturing, and chemical sectors as well as any environmental impacts that need to be addressed,” Sunday said.

In closing, Sunday emphasized that strength in these economic sectors is necessary for growth, food security, and energy independence. He highlighted the importance of Pennsylvanian and American-made products in meeting the challenges of climate change and supporting a growing global economy.

PA Chamber Testifies on Workforce Challenges in Rural Communities

 

HARRISBURG – This week, PA Chamber Director of Government Affairs Kevin Sunday testified on the ongoing workforce challenges that employers face in the Commonwealth’s rural communities during a public hearing at Penn College hosted by the Center for Rural Pennsylvania.

The hearing brought together leaders from Pennsylvania’s energy and healthcare sectors as well as educators, agency officials, and nonprofit associations. Participants included PA Chamber members UPMC, Coterra Energy, Penn College, Penn State, Shippensburg University, and the University of Pittsburgh. Senator Gene Yaw (R-Lycoming) – who also serves as the Center for Rural Pennsylvania’s board chairman – chaired the hearing.

During his testimony, Sunday emphasized the importance of improving Pennsylvania’s economic competitiveness through favorable tax and regulatory policies. “Our goal at the PA Chamber is to make Pennsylvania the most economically competitive state in the nation. This requires a tax and regulatory environment that encourages investment into the state,” Sunday said.

He also highlighted the need for modernized infrastructure to support economic growth throughout Pennsylvania. “We need modernized infrastructure across the state – from a safe and efficient system of roads and bridges to world-class airports and ports, to reliable gas, electric, and water infrastructure, and, just as important, access to high-speed broadband.”

Sunday also discussed recent legislative achievements, including the Senate’s advancement of comprehensive permitting and licensing reform legislation (SB 350) and tax reform measures (SB 345 and 346) that accelerate reduction of the state’s corporate net income tax and enhance businesses’ ability to carry forward net operating losses into future years.

The PA Chamber also supports efforts to improve the state’s workforce by addressing key barriers such as affordable childcare, occupational licensing requirements, and re-entry into the workforce after incarceration. In his testimony, Sunday reiterated the Chamber’s support for expanding Pennsylvania’s Clean Slate law and efforts to improve childcare for working families.

With Pennsylvania’s population decline being another major concern in the hearing, Sunday’s written testimony cited IRS data demonstrating that residents are leaving Pennsylvania for states with better economic climates. Sunday recommended targeted regional marketing efforts and greater collaboration with local chambers of commerce and economic development groups as a solution to help attract more residents to the Commonwealth.

Sunday urged policymakers to focus on creating an environment that attracts investment and promotes population growth. “We encourage the Center to take a close look at regional economic needs and population migration trends. Reforms to the state’s tax and regulatory structure help everywhere, but it is certainly the case that each region of the state has its own key industries.”

Sunday concluded his testimony by restating the PA Chamber’s commitment to working with stakeholders including the governor’s office, state legislature, and local communities to help move Pennsylvania forward.

Sunday’s full written testimony is available here. To watch his remarks, click here.