Regulatory Wrap-Up: Health care returns to the conversation
Bernalillo County, N.M.: The county council voted to increase the minimum wage to $8.85/hr to keep pace with inflation. The increase only applies to unincorporated areas of the county.
Montgomery County, Md.: The County Council Health and Human Services Committee voted 2-1 to accept County Executive Ike Leggett’s proposed changes to the $15/hr minimum wage proposal. The revised provisions extend the timeline for compliance for large business to 2022 and for small businesses to 2024 and the bill now defines small businesses as those with up to 50 employees. Some members of the Council expressed opposition to the delay and vowed to find the votes to change the timeline back to the 2020 and 2022 deadlines in previous versions.
South Bend, Ind: The common council introduced a bill, previously negotiated with the mayor’s office, that sets a minimum wage for businesses receiving property tax breaks to locate in the city. The ordinance mandates that employers who receive those tax breaks are subject to a minimum wage of $10.10/hr as opposed to the statewide rate $7.25/hr. An annual increase of 2% would also apply. The council is set to vote on the bill Oct. 23.
California: A proposed class action lawsuit was filed in federal court against a group of restaurants, arguing they were involved in a price-fixing conspiracy. Allegations center on a 2014 announcement that the restaurants jointly agreed to eliminate tipping and increase prices by 20% in the pursuit of increased profits. The Bay Area restaurants named in the lawsuit have received considerable notoriety for their no-tipping practices.
Menards: The home improvement chain faces multiple lawsuits in differing jurisdictions alleging that the company violated wage laws by not paying employees for breaks and training sessions among other violations. The company is asking the courts to hold the lawsuit until the U.S. Supreme Court rules on a separate, pending case determining the legality of employer/employee arbitration agreements.
California: Governor Brown signed a parental leave bill into law that would guarantee job security for employees who take time off to care for a new child. The bill applies to companies that employ between 20 and 49 workers, granting them 12 weeks of unpaid leave for the birth or adoption of a child. It also contains a mediation program before workers could sue employers for violations.
Austin, Texas: The city council unanimously passed a nonbinding resolution that directs the council to explore a potential citywide paid sick leave law. Stakeholders will debate the issue until a Feb. 2018 hearing when the council is expected to take up legislation.
California: Governor Brown signed into law a bill that prohibits employers from asking applicants about their salary history and also requires employers to provide, upon request, a pay scale related to specific positions. The state is the fourth to pass similar legislation, joining Massachusetts, Oregon and Delaware.
Michigan: The senate passed a bill 27-9 that preempts localities from enacting laws which prohibit employers from requesting a prospective employee’s pay history during the hiring process.
California: A “wage shaming” bill, that would mandate companies with more than 500 employees to submit employee wage data broken down by gender every two years, awaits action by the governor. The data would be available to the public through a state database presenting potential employee and public relations challenges. The governor has until Oct. 15 to sign or veto the legislation and his intentions are unclear at this writing.
Michigan: By a 31-5 vote, the Michigan Senate passed a bill preempting localities from enacting new taxes on food and drinks. The bill now heads back to the house where final passage is likely.
Cook County, Ill.: The county commission voted 15-2 to repeal the controversial countywide soda tax. The tax will officially end on Dec. 1 and will leave an expected $200 million hole in the county’s annual budget.
ACA: President Trump signed an executive order that allows for insurance options to be offered that do not comply with standards established under the ACA. Included in these options are association health plans offered by groups of small employers and greater use of short term coverage. Following the signing of the executive order, the administration announced plans to suspend the federal subsidies paid to insurance companies participating in ACA exchanges designed to keep premiums lower. These two actions combined will dismantle key aspects of the current healthcare market.
NAFTA: During the fourth round of discussions over the renegotiation of the three-country trade deal, the U.S. came forward with several of their most controversial demands which many experts say could threaten the continuation of the agreement. In line with President Trump’s “America First” strategy, the U.S. proposed several potentially toxic demands around automobile sourcing, government procurement, and the inclusion of a sunset clause. Business groups such as the U.S. Chamber of Commerce, have signaled their opposition to the approach, fearing the death of the 20-year old trade agreement as a result.
- The California “wage shaming” bill is specifically designed to create reputational problems for employers and companies will struggle to justify any employee wage gaps based on gender. If the Governor signs the bill into law, expect many Golden State employers to face intense criticism of their pay and promotion practices. Other jurisdictions may entertain adopting similar measures.
- The executive order signed by the president yesterday may ultimately be more style than substance. In reality, it only asks a few agencies to take a harder look at their options with regard to changes to the ACA. The important thing that happened this week is the announcement by the Administration to suspend the subsidies the government pays to insurance companies to keep premiums manageable. Absent a true legislative fix, these administrative actions will upend much of the ACA insurance exchanges and significantly disrupt the market. Operators should expect significant reactions within the insurance market that may affect the cost of private plans they offer.
- The progressive agenda has had a bad last few weeks. In three reliably left-of-center cities, various parts of the agenda received significant pushback. Albuquerque voters defeated a paid leave measure, Cook County repealed their soda tax, and Washington, DC is revisiting their landmark family leave law. Social idealism and economic reality are increasingly colliding in traditional blue cities and the progressive agenda is taking the brunt of the damage. Now is a good time for operators to underscore their narratives regarding job creation, workforce development and upward mobility.
Legislature Status for Week of 10/16/17
- The United States Senate is in session this week.
- The United States House is out of session this week.
- The following state legislatures are in session year round: Illinois, Massachusetts, New Jersey, New York, Ohio, Pennsylvania and Wisconsin.
- The following additional states are currently in session: Michigan, North Carolina and Rhode Island.
- Oklahoma is in a special session convened on Sept. 25
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Market Recap: RISI Crow’s Construction Materials Cost Index
A price index of lumber and panels used in actual construction for Oct. 13, 2017.
Western: regional species perimeter foundation
Southern: regional species slab construction
Crow's Market Recap: A condensed recap of the market conditions for the major North American softwood lumber and panel products as reported in Crow's Weekly Market Report.
Interest among buyers to purchase SPF lumber volumes remained stout, although sales slowed moderately for some producers. Reluctance among customers to purchase volumes that will not ship until November held back buying. Volumes offered for quick shipment sold readily. Secondaries carried limited positions from which to sell.
- Southern Pine prices began to retreat after a five-week run of consecutive gains. Seeing prices weaken early, a number of buyers stepped back from the market at midweek in anticipation of more price erosion.
- Most Coastal species random tally dimension prices remained solid or continued to move higher despite producers reporting somewhat slower and spotty sales. Buyers entered the market to replenish but remained wary of price levels.
- Inland price gains were again common, and the size of some of those gains is uncommon. Inland Hem-Fir, which accelerated strongly two weeks ago, saw good advances in the wider widths this week.
- While traders described 2×4 stud activity as light, many of those prices managed to get through another week without being lowered. Supplies of 2×6 9’ were particularly tight, placing upward pressure on many of those prices for yet another week.
- Radiata Pine continues to be a moot question with regard to prices. Radiata availability, unlike Ponderosa, seems to have increased, without any effect on prices.
- Much of the Ponderosa Pine industrial market seems to have been on hold for many weeks. It is clear from recent conversations, however, that the availability of Ponderosa is not as ready as it was a few weeks ago. Ponderosa Pine Selects are quietly stable, continuing a trend that has continued in place for over a year. Ponderosa 4/4 Common board prices show slight changes.
- Idaho White Pine strengthened from $10 to $25 in Sterling.
- After a slow start, in part due to Monday’s holidays in Canada and the U.S., Western Red Cedar traders reported a pickup in demand, giving sales activity a steadier feel by week’s end.
OSB is on stable footing, but sources feel pricing is getting toppy, especially given the time of year. Demand and construction activity are strong, and buyers are still going hand-to-mouth on purchases, fearful of high prices and seasonal realities.
- Southern Pine plywood trading settled in at a slower pace than prior weeks. Still, buyers exhibited an urgency to replenish as strong volumes sold from their yards. Buyers frequently checked on orders while mills continued to struggle with late shipments.
- Western fir plywood sales slowed enough to generate flat CDX pricing. Buyers sensed greater potential for downside to the current price cycle and held off purchases when possible. Yards filled in where necessary. Mill order files ranged from the weeks of Oct. 23 to 30.
- Following a meteoric rise to record high prices in August, Canadian plywood markets took a major fall this week as mills tried to make product attractive to spooked buyers. Mills widely offered discounts to reluctant customers.
- Particleboard sales were lethargic but steady, according to producers. Ample volumes remained available to customers.
- Mills reported little change in MDF sales. Order files allowed buyers to purchase volumes at a comfortable rate, but transportation issues presented problems.
For more on RISI, click here.
Survey: Corporate America and Sustainability
A study released earlier this year and conducted by Deloitte Resources was designed to capture the views of American consumers and businesses about their attitudes and practices when it comes to sustainability and the use of natural resources.
Referred to as the Deloitte Resources 2017 Study, this annual study was based on their findings for calendar year 2016.
As to businesses, the researchers conducted more than 700 online interviews with what were termed "business decision makers." These decision makers all worked in companies with more than 250 employees and were in a variety of different industries.
"The gist of what they found," according to Stephen Ashkin, CEO of Sustainability Dashboard Tools, "was that companies are getting much more involved in resource and energy management. In fact, it has been increasing in increments for nearly a decade."
As to why these companies are moving in this direction, 54 percent said cutting costs was the primary factor.
"However, they found something else evolving," adds Ashkin. "According to the study, more than eight in ten now say they are shifting from merely focusing on cost reduction to risk reduction."
Reducing risk, he says, is how companies can be more resilient to unexpected price increases in energy, fuel, and water, or survive significant storms, such as the recent hurricanes.
Among the other findings of the study were the following:
* Sixty-one percent of the decision makers indicated it's their customers that are demanding they become more sustainable and turn to renewable resources;
* Sixty-five percent report their companies actively publicize the fact that they are turning to renewable energy sources, apparently using their sustainability efforts also as a marketing tool;
* Business consumers indicated they reduced their energy consumption by 19 percent in 2016; this compares to 15 percent in 2015 and 14 percent in 2014;
* Half of the companies reported they now have documented energy/mission statements, something few companies had just a few years ago.
"On the consumer side," Ashkin says, "the researchers found that Millennials are strongly behind sustainability initiatives. They promote and share innovations on social media and are willing to put their money where their values are."