TOP STORIES
Governor to call a special session before Christmas
Gov. Chris Gregoire said today that she will call the Legislature into a special session, ending weeks of speculation over how lawmakers would address a growing state budget shortfall. The governor gave lawmakers until Thursday to select a starting date for the session, and if they don’t do it by then she will pick for them, the Associated Press reported. KOMO news said it could happen as soon as Friday or early next week. Republican lawmakers renewed calls for a special session last month after the latest state revenue forecast projected another $385 million drop between now and June 30, but Gregoire held off, saying she wanted agreement on cuts beforehand.


House Democrats propose state budget cuts
House Democrats released a preliminary list of proposed cuts last Thursday to deal with a projected $1.1 billion shortfall for the current state budget. Unlike Gov. Gregoire’s proposed cuts, they would not eliminate the state’s Basic Health Plan or the Disability Lifeline program. The preliminary list includes $693 million in reductions to education, general government and health and human services, and $161 million in fund transfers. The proposed budget cuts came after last month’s revenue forecast showed tax collections falling below projections. Overall, the state expects to bring in approximately $900 million less in revenue this fiscal year.


AWB’s Holiday Kids’Tree Project raises more than $20,000 for needy families
Thanks to the generosity of AWB member companies and individuals, families in seven rural counties will have a brighter holiday this season. This year’s Holiday Kids’ Tree Project raised more than $20,000 for individuals and families in need. On Friday, AWB President Don Brunell and Gov. Chris Gregoire met with representatives from the rural fire districts who will help distribute the cash in the form of gifts and donations. Gregoire and Brunell then joined Sgt. Kevin Barretta and his family in the lighting of the holiday tree in the capitol rotunda. Barretta is with the 2nd Stryker Brigade Combat Team stationed at Joint Base Lewis-McChord, and recently returned from Afghanistan. This year marked the 22nd anniversary of AWB’s role in the event. The fundraiser to help those in need is what the holiday season is all about, and AWB is proud to be part of it.


AWB urges legislators to tackle unemployment insurance reform in 2011 session
Washington employers need a more predictable unemployment insurance tax structure to guard against excessive taxes during periods of sustained economic instability and high unemployment. That was the message from AWB’s second in a series of session briefings outlining priority issues for the 2011 legislative session. Failure to stabilize unemployment insurance taxes will lead to job loss and a sluggish economy. The paper, Stabilizing Unemployment Insurance Taxes, recommends that lawmakers address the problem by: (1) placing a generous cap on the social tax rate; (2) adjusting the proportion of taxes collected from specific rate classes; (3) prohibiting the diversion of UI trust funds; and (4) maintaining existing benefit levels for unemployed workers. The first paper called for a reform of the state’s workers’ compensation system. Watch for the next installment later this week. The topic: regulatory freeze.


DelBene named Department of Revenue director
Gov. Gregoire named Suzan DelBene, the former Microsoft executive who ran unsuccessfully against Republican Congressman Dave Reichert this fall, as the new Department of Revenue director last Tuesday. DelBene takes over the department at the very moment the state faces revenue shortfalls for the next 30 months. Gregoire says DelBene will lead the department as it works to simplify the state tax code for businesses and collect money from companies that aren't paying their taxes.


Burdensome 1099 requirement in health-care law survives U.S. Senate vote
The U.S. Senate failed to remove one of the most burdensome requirements from the new federal health-care law. Last Monday, the Senate turned back efforts to remove the requirement that all business-to-business transactions over $600 must be reported to the Internal Revenue Service via a 1099 form. Despite the setback, new proposals to repeal the 1099 reporting requirements are expected soon once the new Congress takes office in January. At a time when the national employment rate is climbing – it’s now 9.8 percent, according to the U.S. Labor Department – it is essential that government makes it easier for employers to do business, not more difficult with measures like the 1099 requirement.


Passages: Jeannette Hayner, former legislator, C. David Gordon Award Winner
Veteran state legislator Jeannette Hayner died on Nov. 27; she was 91. A former Senate majority leader, the Walla Walla Republican served in the House of Representatives from 1973-77 and in the Senate from 1977 until her retirement in 19992. Hayner was known for effectively negotiating state budgets when money was scant and finding ways to tackle complex issues like health care and growth management. She also was the founding chairwoman of TVW. AWB honored Hayner with its C. David Gordon Award in 2006 for her outstanding service to the business community during her legislative career.“She was a wonderful lady and those of us who were fortunate to know her and her husband, Dutch, have fond memories,” said AWB President Don Brunell. “America, Washington, and politics need many more Jeannette Hayners.Rest in peace; you did your job well.”


Tell Congress that now is no time to increase taxes
With the economy struggling to pull out of a punishing recession, this is no time to raise taxes. Congress, however, is on the verge of allowing one of the biggest tax increases in our nation's history. Contact Congress now and add your organization's name to a letter that will be sent to lawmakers urging them to support extending the 2001/2003 tax cuts and business tax provisions. If Congress fails to act, Americans will face one of the biggest tax hikes in history beginning Jan. 1. Marginal tax rates will increase for every taxpayer, the capital gains rate climbs 33 percent and dividend rates jump by as much as 164 percent. Congress must act now to prevent this tax increase. Extending the expiring 2001 and 2003 tax cuts would boost investor, business, and consumer confidence by taking the uncertainty of tax policy off the table. Additionally, tax provisions — such as the R&D credit and active financing exception — have expired. An extension will bring more certainty to business owners and encourage investment.


It’s official: Republicans declared winners in 3 legislative race recounts
Three state legislative races that were close enough to require recounts were decided last week in favor of Republican candidates, narrowing the Democratic lead to 27-22 in the Senate, and 56-42 in the House. Hans Zeiger edged Rep. Dawn Morrell by just 30 votes in Pierce County’s 25th District race; Steve Litzow defeated Sen. Randy Gordon in King County’s 41st District; and Vincent Buys won the recount against Rep. Kelli Linville in Whatcom County’s 42nd District. Gov. Chris Gregoire and Secretary of State Sam Reed certified the November election last week.


Better Workplace Awards – Nominations due Friday
AWB’s Better Workplace Awards honor companies that go the extra mile to create better working environments in the areas of workplace safety, job training, advancement programs and innovative benefit and compensation programs. Have your company recognized for its accomplishments! The awards, sponsored by Davis Wright Tremaine, will be presented at our annual Legislative Day in Olympia on Feb. 3. For more information, contact AWB’s Chana LaChapelle. The deadline to submit a nomination is Friday.


Report winter storm damages to your local emergency management agency
Businesses that suffered an economic loss due to the recent winter weather should submit economic injury worksheets to their county emergency management agency. The worksheets help establish that a business has sustained an economic injury. For additional information about the SBA business disaster loan program, please contact Toney Raines, human services manager at Washington’s Emergency Management Division, at 253.512.7028.


Get ready for AWB’s 2011 regional outreach program
AWB President Don Brunell meets quarterly with Gov. Chris Gregoire to share business concerns, as well as with many of the state agency directors to discuss critical issues. He needs your input. During 2011, Brunell or one of AWB’s team members may be available to travel to your region to keep you posted on current legislative events and hear your concerns. If you are interested in this outreach, contact AWB’s Bonnie Millikan.


AWB Legislative Reception & Lobby Day in Olympia, Feb. 3-4
Meet with your lawmakers and educate them about issues affecting you as an employer at AWB’s Legislative Reception & Lobby Day. AWB’s annual legislative briefing and reception takes place Feb. 3 at Olympia’s Red Lion Hotel. Then on Feb. 4, the action shifts to the Capitol Campus where AWB members will meet with legislators. Visit us online to register. Interested in becoming a sponsor? Act fast, sponsorship levels are filling up quickly so don’t miss this opportunity to put your company in the limelight! For more information, contact AWB’s Anne Haller.


KEY HEARINGS, MEETINGS
Workers’ Comp Coalition meets Thursday to plan for 2011 session
The Workers’ Comp Coalition will meet Thursday, 1:30 – 3:30 p.m., at AWB.The agenda will focus on legislative strategy and tactics heading into the break before session.For more information, contact AWB’s Kris Tefft.


Water Quality Committee meeting on Thursday
The AWB Water Quality Committee will meet Thursday, 2 – 4 p.m., at AWB. Agenda items include an update on the Stormwater Technical Resource Center, state water quality standard revisions and potential water quality-related legislation. For more information, contact AWB’s Grant Nelson.


Washington Jobs Investment will discuss tax increment financing on Saturday
AWB members are invited to attend the Washington Jobs Investment Coalition’s organizational meeting on Saturday, 11:30 a.m. – 1 p.m., at AWB.Free and pizza and soft drinks will be served. The coalition is being formed by a group of private and public sector organizations to pursue legislation that would allow the use of tax increment financing (TIF) in Washington State.TIF is an important economic development tool that is available in most states to spur job-creating economic development projects. For more information or to RSVP, contact David Fisher at 360.870.1332.


AWB’s Puget Sound Partnership Sucommittee to meet next Monday
AWB’s Puget Sound Partnership Subcommittee will meet next week with PSP Leadership Council chair Martha Kongsgaard, Interim PSP Director Gerry O’Keefe, and Public Affairs Director Michael Grayum. The committee will hear from the Partnership on its work to implement the PSP 2020 Action Agenda, including recent work of the Leadership Council and the Ecosystem Coordinating Board on 2011 legislative priorities. The Partnership will also hear from AWB and its members on policy ideas for implementing the Action Agenda. The meeting is Monday, Dec. 13, from 10 a.m. – noon at the Master Builders Association of King and Snohomish Counties offices, 335 116^th Ave. SE, Bellevue, WA. A conference call number will be available. Please contact Connie Grande for the call in number and pass code if you’d like to participate by telephone.


OTHER NEWS
AWB Institute and community colleges looking for business expertise
The AWB Institute is looking for business representatives to lend their talent, expertise and (a little) time to serve on selected committees for the community/technical college system including the Customer Advisory Committee and advisory board members for the Agriculture Center of Excellence at Walla Walla Community College and Center of Excellence for International Trade, Transportation and Logistics at Highline Community College. If you or someone from your company would be interested in investing a small amount of time to help guide these community college groups, or would like more information contact AWB Institute’s Mike Hudson.


Member Spotlight: Safeway opens new, environmentally-friendly store in Seattle
With the Nov. 12 opening of a ground-up replacement of its Pinehurst store in North Seattle,Safeway’s Seattle Division broke new ground in environmentally conscious grocery retailing. “Our new Pinehurst store reflects the silver standard for sustainable supermarket design for Safeway and the entire supermarket industry,” said Greg Sparks, president of Safeway’s Seattle Division. Read more in this week’s new AWB’s Member Spotlight. Contact AWB’s Paul Schlienz to share good news about your business.


Dream Big Small Business Award nominations due Jan. 7
The U.S. Chamber of Commerce’s DREAM BIG Small Business of the Year Award, sponsored by Sam’s Club, honors job creators and recognizes their significant contributions as drivers of economic growth. This is an excellent opportunity to honor small businesses that are active in your community. The winner receives a $10,000 cash prize. Blue Ribbon Small Business Award winners, seven regional finalists, and the 2011 DREAM BIG Small Business of the Year winner will be honored at America's Small Business Summit 2011 on May 24 in Washington, D.C. Nominations are due Jan. 7.


AWB EVENTS & RESOURCES
Employee vs. Independent Contractor: Where's the Line Webinar – Dec. 8
The U.S. Department of Labor and the Internal Revenue Service recently identified employer misclassification of independent contractors as a top enforcement priority across the country, and here in Washington the state Department of Labor & Industries has intensified its focus on this issue in specific industries. Misclassification of employees costs federal and state government’s substantial tax revenues each year and exposes employers to penalties and liability for back taxes, overtime pay, workers’ compensation and retirement benefits. Yet the rules for properly classifying employees and independent contractors are not always clear. This 60-minute webinar will tackle the latest strategies for correctly classifying and managing independent contractors and discuss L&I's enforcement program and what to expect if you are audited. Register online or contact AWB’s Chana LaChapelle.


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THEY SAID IT
“There was a time to do this and legislators did not take it. Now there is no time. The revenue and spending numbers have the state boxed in. Gregoire has to call a special session. The Democratic caucus has to get real, and help their governor, and their state, now.” – Seattle Times staff editorial


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