With the California Legislature now in summer recess, questions persist about the scope and impact of bills that will eventually be approved this session.
The mid-point assessment is a mixed bag of results for small businesses, John Kabateck, California state director with the National Federation of Independent Business (NFIB) told the Northern California Record.
“On the positive side, the governor has made clear he has no intention of raising taxes, he signed AB 80 for tax relief on PPP [Paycheck Protection Program] loans, and AB 150 to lift restrictions on State and Local Tax (SALT) deductions,” Kabateck said.
But Kabateck questioned why more of the state’s unexpected surplus isn’t going toward paying down debt.
“One very disappointing thing in the budget is our progressive policymakers will do nothing this year to pay down our astronomical Unemployment Insurance liability,” Kabateck said.
The UI debt is presently estimated at roughly $22 billion, the California Business Roundtable said in a news release. About $1.1 billion was allocated for it in the budget – not enough to provide near-term relief to employers or workers, according to the nonpartisan Legislative Analyst’s Office, but still better than nothing.
“We could have at least gotten some water out of the boat if not plugged up the hole,” Kabateck said. “If our state isn’t paying down the debt, it will clearly fall on business owners through unemployment insurance and payroll taxes.”
Kabateck noted a “grave disappointment” also resulted from lawmakers’ failure to grant a committee hearing to a small business liability protections bill for the second year in a row.
“Which tells us that the special interests of plaintiffs’ attorneys still wield unfair influence over our policymakers in the capitol,” Kabateck said.
The NFIB’s Small Business Optimism reports indicate it could take longer than a year before many of them rebound.
“We’re very concerned that there might still be some efforts to gut and amend bills towards the end of session that will cater to labor and lawyer interests at the expense of small business owners,” Kabateck said.
“We still have a very uncertain and unpredictable reopening process,” Kabateck said, noting that over the weekend Los Angeles County reinstated a mask mandate in response to rising COVID-19 cases.
“We are far from out of the woods,” Kabateck said. “We're very concerned that a lot of policymakers will either quickly run back to the special interests trough of lawyers and labor unions, or quickly forget that small business owners are still struggling to make ends meet.”