End of Legislative Session Marks Some Wins for Nonprofit Sector

Everyone entered Legislative Hall on June 30th relieved that SB 235, the general operating budget, had been adopted on 6/26/2018, and were eager to shake off the frustrating events of exactly one year before.  Unfortunately, the General Assembly found themselves hindered by negotiations on a few initiatives with HB 475, the Bond Bill, and SB 237, the Grant-in-Aid bill, hanging in the balance until the sun came up over Legislative Hall on July 1st.

Despite a sleepless night, the General Assembly closed with positive outcomes for the nonprofit sector.

On June 26th, the Joint Finance Committee voted to reinstate Grant-in-Aid to the FY 2017 levels. During that conversation they noted there would be final adjustments depending on the status of other state allocations.  By the time the Joint Finance Committee met on June 30th at 10:15pm, many of these unknown factors had been resolved.  While we were overjoyed to be reinstated to fiscal year 2017 allocation levels, when the Grant-in-Aid bill was finalized, funding overall was approximately 12% greater in the Grant-in-Aid bill for FY 2019 vs. FY 2017.  Joint Finance Committee members were able to allocate funds set aside for the fiscal note on another bill, and this resulted in greater spending being directed to Grant-in-Aid recipients.  Upon review of the bill, not only did some existing grantees receive additional funds, there are new organizations that were awarded funds from Grant-in-Aid.  This is an excellent outcome to our sector’s request to invest into nonprofits in 2018-2019.

Several legislative actions will change employment practices for our nonprofits:

Minimum wage in Delaware will be increased because of SB 170 as amended by Senate Amendment 2. The increase will take effective over the course of two years, raising to $8.75 per hour by January 1st, 2019 and to $9.25 per hour by October 1st, 2019.  To garner the support of republicans in the House of Representatives a companion bill, HB 483, passed on the morning of July 1st.  This legislation establishes a “Training Wage” which allows employers to pay an employee who is 18 years or older not more than $.50 less than the minimum wage for the initial 90 days of employment.  In addition, a “Youth Wage” was created to compensate youth under the age of 18 a wage not more than $.50 less than the minimum wage.  These provisions go into effect on January 1st, 2019 as well.

Addressing workplace sexual harassment by defining specifically what conduct constitutes sexual harassment, and responsibilities of the employer and the employee.  House Substitute 1 for HB 360 requires the Department of Labor to create an information sheet to outline how sexual harassment is illegal, what defines sexual harassment, and what to do if you are experiencing workplace sexual harassment.   Employers will be required to distribute to employees.  This legislation also outlines training requirements for employers which needs to be completed prior to January 1st, 2019.

Pay for Success contracts, established by Senate Bill 242 as amended by Senate Amendment 1, sets up the ability for a State Agency to pursue a pay-for-success agreement (also known as social impact bond) with a community organization and private investors.  Private investors pay for the work that would be done, and the state agency reimburses them with interest when the deliverables are met.  Key to this type of arrangement is agreeing on the outcomes and how they will be measured and will most likely work well with initiatives which have proven success methodologies.

As we look toward the future, DANA is focused on Census 2020 and implications for Delaware. The United States Census Bureau has shared opportunities for state and local governments to begin planning for counting undercounted populations.  Nonprofits will play a critical role to ensure everyone gets counted in the State of Delaware.  Given that federal dollar allocations are based upon population, an accurate count could result in additional resources for Delaware.  The Delaware General Assembly recognized the importance of the 2020 Census and passed House Concurrent Resolution 99 to encourage Governor Carney to establish a Complete Count Commission to engage community leaders, faith organizations, non-profit organizations, local government, legislative leaders to plan for the Census.

In addition to monitoring progress at the end of Legislative Session on the FY19 Budget and Grant-in-Aid bill, below are other bills that DANA has been tracking with final outcomes. Please note that because this was the second half of a General Assembly, legislation not passed at the close of session does NOT carry forward. Everything starts over again in January 2019.

Issue

Status

HB 260 w/ HA2, HA3: Creates a Grant-In-Aid Committee (Representative Longhurst/Senator Townsend) The Senate did not consider this legislation.
HB 341 (Briggs King): Proposes a constitutional amendment that requires the General Assembly to wait 48 hours from the introduction of the budget appropriation bill, bond and capital improvement act, and act making appropriations for certain grants-in-aid bill, or any substantive amendment or substitute bill to such bills before voting on such legislation unless the General Assembly by a three-fourths vote waives this requirement.  

The House of Representative did not   consider the legislation.

HS 1 to HB 360 (Keeley): Defines sexual harassment as an unlawful employment practice. Employers having more than 50 employees must provide sexual harassment training to their supervisory employees six months after they assume the supervisory role, and the training must be conducted every two years. Passed both the House and the Senate.
HB 416 (Ramone): Creates a tax exemption for non-profit owned swimming pools in New Castle County and Kent County. The House of Representatives did not consider this legislation.
HCR 61 (Postles): Requests the JFC reinstate GIA funds removed from current fiscal year.

 

 

 

The House of Representatives did not

 consider this legislation.

HS 1 to HB 104 (Smith): Mandates an increase in the rates paid to service providers according to the recommendations of the market study, so that by fiscal year 2021 the state would fund service

providers at 100% of the benchmarked rate. Also requires that the adequacy of the rate system be evaluated against performance measures that are commonly used to assess program quality.

Passed by both the House and the Senate.

 

 

 

 

SB 170 w/ SA 2 (Marshall): Increases the minimum wage in the State beginning in 2018 and ending in 2021. Passed by both the House and the Senate.

 

SB 235 (McDowell/Smith): This Bill is the Fiscal Year 2019 Appropriation Act. Passed by both the House and the Senate.
SB 263 (McDowell/Smith): This Act amends the Delaware Governmental Accountability Act to make the annual budget process part of a performance management system of strategic planning, performance metrics and performance budgeting, dedicated to continuous process improvement that makes government more efficient, reduces costs and eliminates waste in the process and operations that deliver goods and services to taxpayers, customers and employees of State government. Passed the Senate.

The House did not consider this legislation.

HB 460 (Q. Johnson): The first leg of a Constitutional Amendment reflecting the recommendations of the Advisory Panel to the Delaware Economic and Financial Advisory Council (DEFAC) on Potential Fiscal Controls and Budget Smoothing Mechanisms – moving the Budget Reserve Account into a newly defined Budget Stabilization Fund, defining rules for deposits to and withdrawals from said Budget Stabilization Fund, and adding a check of the appropriation limit against an index comprised of relevant indicators of growth of the State’s economy. This bill was not considered by the House.

Subsequently, Governor Carney issued Executive Order 21: Implementing Key Recommendations of the Advisory Panel to DEFAC to Study Potential Fiscal Controls and Budget Smoothing Mechanisms.

SB 242 w/ SA 1 (Walsh/Williams): This Act creates Pay for Success contracts. A Pay for Success contract is an agreement between a State agency and either a program intermediary or an investor under which an investor will provide upfront capital to fund a service, program, or economic development initiative. The State agency agrees to repay the program intermediary or investor if the service, program, or economic development initiative meets the performance measures and outcomes agreed to in the contract. Passed by the Senate and the House
HB 310 w/ HA 1, HA 2 + SA 1 (Smith): The Certification of Adoption of Sustainability and Transparency Standards Act establishes a voluntary disclosure regime to foster dialogue around sustainability and responsibility among participating Delaware business entities and their various stakeholders. Passed by both the House and the Senate.

Given the number of legislative initiatives that impact human resources management within our organizations DANA will offer a Legislative Impact Information Session in the coming months.

Thank you to those that made phone calls, sent emails, attended legislator coffee events, and spend time in Legislative Hall on June 30th.  Throughout the evening, on various pieces of legislations, policymakers noted that they had heard concerns or comments from those in the nonprofit community.  We are being heard, and this means we need to continue to intensify our efforts in the coming months in preparation for 2019.