Government

CSLB Expands Nationwide as Momentum Builds to Overturn Job-Killing Rule

29 December 2023
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Michael Layman, senior advisor to the Coalition to Save Local Businesses (CSLB), issued the following statement highlighting CSLB’s rapid nationwide growth. Since its November relaunch, CSLB has driven almost 60 groups across 10 states to call on their state congressional delegations to support a bipartisan resolution to overturn the job-killing joint employer rule.

“Momentum is building to stop the job-killing joint employer rule,” said Layman. “Small and local business owners across America know this overreaching and unworkable regulation will kill jobs, shutter storefronts, increase litigation and make an already uncertain economic outlook that much worse. It’s encouraging to see the widespread support in communities across the country for overturning this disastrous rule.”

The NLRB’s final joint employer rule would expand 6he definition of joint employer, stripping small business owners of authority over their employees. This new joint employer rule expands on an old joint employer rule that destroyed an estimated 376,000 jobs, cost small businesses an estimated $33 billion, and led to a 93% spike in lawsuits in the franchise sector alone.  Proposed in Sept. 2022, the expanded joint employer rule was finalized on Oct. 26, 2023, was scheduled to take effect on Dec. 26, 2023 and has now been postponed until February 26, 2024.

Brad Griffin, CEO of the Montana Equipment Dealers Association said, “Agriculture is the lifeblood of Montana’s economy and supplying this vital industry with proper equipment is fundamental to its success. We oppose the joint employer rule, because it will negatively impact our dealer-member’s relationships with their agriculture partners. The Montana congressional delegation should absolutely support the effort to overturn this harmful rule.”

Earlier this year, a group of 72 organizations sent a letter urging Congress to use the Congressional Review Act (CRA) to overturn the NLRB’s final joint employer rule. Following the initial letter, organizations in Arizona, California, Maine, Minnesota, Montana, Nebraska, Nevada, New York, North Carolina, and North Dakota sent similar letters to their state congressional delegations.

U.S. Senators Bill Cassidy, M.D. (R-LA), ranking member of the Senate Health, Education, Labor, and Pensions (HELP) Committee, and Joe Manchin (D-WV), Senate Republican Leader Mitch McConnell (R-KY), Representative Virginia Foxx (R-NC), chairwoman of the House Education and Workforce Committee, Representative John James (R-MI) and Speaker Mike Johnson (R-LA) introduced resolutions of disapproval under the CRA to overturn this new job-killing rule.

The Coalition to Save Local Businesses represents hundreds of thousands of local businesses and millions of American jobs through its membership and partner organizations.  The coalition’s goal is to raise the voices of everyday Americans who own, operate, work for and depend on local businesses for their livelihoods.

The Poor are Getting Richer Under Current Tax System

26 December 2023
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By Scott Hodge, Tax Foundation

Underlying every fiscal policy discussion in Washington is the question of progressivity: how much should tax and spending policy redistribute from high-income households to low-income households?

This debate is often more rhetorical than substantive, but a recent study by the Congressional Budget Office (CBO) fills this void by presenting data showing that the current fiscal system—both taxes and direct federal benefits—is very progressive and very redistributive.

The CBO study estimates the impact of federal fiscal policy on household incomes in 2019 (the most recent data). It does this by contrasting how much households benefited from social insurance programs (e.g., Social Security and Medicare) and means-tested transfer programs (e.g., Medicaid, SNAP, and Supplemental Security Income) with how much they paid in total federal taxes—including individual income taxes, payroll taxes, corporate income taxes, estate taxes, and various excise taxes.

These policies lift the incomes of many households (who receive more in federal benefits than they pay in total federal taxes) while reducing the income of others (who pay more in federal taxes than they receive in direct federal benefits). CBO’s data allows us to measure the impact of these policies on the average household within various income groups and then aggregate the results to measure how these policies redistribute income between groups of households.

To be sure, households do benefit from other federal programs such as national defense, highway spending, and public education, but CBO does not include the benefits of such programs in this exercise. The study is solely focused on fiscal policy that directly impacts household incomes.

Federal benefit programs and taxes can either raise market incomes or reduce them. For example, in 2019, households in the lowest quintile paid almost no federal income taxes but received nearly $22,000 in transfer benefits. As a result, these policies more than doubled their household incomes, an increase of 126 percent.

The story is very similar for households in the second and middle quintiles, although not as extreme. After netting their federal taxes paid, direct federal benefit policies raised the incomes of households in the second quintile by 39 percent and the incomes of households in the middle quintile by 11 percent.

The story changes completely for average households in the top two quintiles. On average, they paid more in taxes in 2019 than they received in direct federal benefits. Households in the fourth quintile, for example, saw their incomes fall by 4 percent, while households in the highest quintile saw their incomes fall by 21 percent.

At the very top of the income scale, the story is even more dramatic. Households in the top 1 percent paid an average of roughly $600,000 in federal taxes and received about $15,000 in federal benefits. As a result, federal tax and spending policies reduced the incomes of households in the top 1 percent by nearly one-third (30 percent).

It is interesting to note that federal benefit programs are distributed relatively evenly across the income scale, while federal taxes skew very heavily to higher-income earners.

Federal fiscal policy increased the overall income for households in the lowest quintile by $566 billion in 2019. Households in the second quintile gained $390 billion in income while households in the middle quintile gained $187 billion in income.

Combined, the first three quintiles gained more than $1.1 trillion in income thanks to federal benefit policies, even after netting out their federal taxes paid.

On the other end of the income scale, progressive fiscal policy reduced the incomes of households in the fourth quintile by $109 billion in 2019. However, this is a fraction of the nearly $1.7 trillion that households in the highest quintile saw their incomes fall due to federal fiscal policy. Of this amount, some $702 billion came from households in the top 1 percent alone.

Overall, federal fiscal policy lowered the incomes of the top 40 percent of American households by roughly $1.8 trillion in 2019. Of this, more than $1.1 trillion was redistributed to lift the incomes of households in the bottom 60 percent of the population, while the remaining $656 billion went to pay for other federal spending.

Retired Americans Likely to See Higher Prescription Drug Costs

26 December 2023
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The cost of prescription drugs will likely increase 42-57 percent for retired Americans enrolled in Medicare’s Part D prescription coverage in 2024. The reason is the manipulation of the market by government which encourages insurers to shift costs from one group of users to be borne by another.

A change in the Inflation Reduction Act, which reduces co-pays for some, especially those with chronic conditions, shifts that cost to about a fourth of Medicare recipients who exceed the threshold of the new $2000 cap and will be expected to cover 60-80 percent of their prescription costs.

Earlier reports projected slight premium declines across Part D plans next year, but the HealthView report, published in November 2023, contrasts sharply with a July projection by the Centers for Medicare & Medicaid Services (CMS), the federal agency that administers the Medicare program, 

CMS said there would be a 1.8 percent decline in Part D premiums for 2024, because of “reforms” in the Inflation Reduction Act. However, HealthView forecasts major hikes for retirees in states with large senior populations. They projected average increases ranging from $269 in Texas to $510 in New York.

The Inflation Reduction Act lowered the maximum out-of-pocket spending cap for Medicare Part D prescription drugs from $7,050 in 2023, to $2,000 in 2025, reducing co-pays for some, especially those with chronic conditions. However, financial liability will shift to insurers expected to cover 60-80 percent of costs once patients hit the new $2,000 cap.

With roughly a quarter of Medicare recipients exceeding this threshold, HealthView analysis suggests carriers will raise premiums to account for their increased coverage requirements. The higher premiums are a way for insurance companies to cover the expected increase in costs.

So, while the Inflation Reduction Act aims to lower overall healthcare costs for retirees, it may actually increase 2024-2025 Part D premiums for 75 percent of enrollees seeing no co-pay relief.

Epoch Times reports, “Americans pay for prescription drugs over 2.5 times more than other high-income nations. One in five seniors alter medication use due to high prescription costs, a May 2023 national survey found. They either skipped, delayed, took less medication, or took someone else’s medications.”

HealthView analysis shows 2024 increases could outpace the average retiree’s Social Security cost-of-living adjustment (COLA) by 70 percent – posing real financial challenges.

Local Taxes – $5,148 Per Person

22 December 2023
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In Montana the State and Local Governments collected $5,148 per person in 2021. The collections were 30th highest – in other words, 30 states collected more in tax revenues per person in 30 other states.

New York collected the most at $10,266. New York was, however, exceeded by Washington DC where collections were $13,278. California collects $9,175 per person.

State and local government in Alaska collect the least at $4,192 per person. Alabama was second to the last collecting $4,245 per person. Tennessee ranked 48th pulling in $4,272 in revenues for each citizen, followed by Florida at $4,405 in state and local government revenue collected per person.

Among Montana neighbors, North Dakota ranks the highest collecting $7,005 per person in state and local government taxes. Idaho ranks 41st, collecting $4,650 per person. Wyoming collects $5,213 per person, ranking it 28 and South Dakota ranks 38th, collecting $4,677 per person.

The Tax Foundation explained some of the figures stating, “Alaska is an anomaly here: while the state imposes incredibly low tax burdens on residents, its severance taxes generate substantial revenue that often yield relatively high collections per capita. FY 2021, however, captured a period of significant fluctuations in oil markets, from which the industry—and Alaska’s revenues—have since recovered. Similar effects are evident in other resource-dependent states, like North Dakota and Wyoming, which had markedly lower per capita collections in FY 2021 than in years prior, or (based on their own revenue data) since. These states export much of their tax burden, and there was simply less to export that year.”

The Tax Foundation further commented, “It’s worth noting that severance taxes are only one of many examples of the “tax exporting” that states engage in. Travel taxes—such as hotel, car rental, and meal taxes—also disproportionately impact nonvoting nonresidents who have few means of redress. As a result, states that generate substantial amounts of tax revenue from tourism may also show tax collections per capita that are higher than the actual tax burden that falls on the in-state population. Taxes on businesses may also be exported, at least in part, to investors across the country, and to employees wherever they are located. It is important to keep both legal incidence and economic incidence in mind when evaluating the true costs of any tax.

State and local governments fared well in FY 2021, but with all the ways our world has changed since the start of the pandemic, that feels like eons ago. Even though these maps are always limited by the timing of Census data releases, it’s fair to ask where things stand now. And fortunately, while we can’t go state by state, we do have quarterly data for the national aggregate of state and local tax collections through FY 2023.

Since FY 2019, the last full fiscal year before the pandemic, state and local tax collections have risen more than 27 percent. Much of that gain is subsumed by inflation, but even after adjusting for inflation, state and local tax revenues are more than 7 percent higher than they were pre-pandemic.

Revenues soared in FY 2021, jumping a full 10 percent (inflation-adjusted) higher than pre-pandemic figures, edging up even higher in FY 2022 (to 12 points up) before coming down to earth a bit in FY 2023. But this should not be alarming. Partly, it is a reversion to the mean: state revenues skyrocketed, and it’s okay for them to level off or even decline a little, as long as the new totals remain higher (in real terms) than before. Additionally, almost every state has adopted tax cuts since the start of 2021, including 25 that have cut individual income tax rates since then. Legislators wanted to return some of the revenue growth to the taxpayers—and even with that, revenues remain up in real terms.

Recent revenue declines, moreover, are concentrated in California and New York, high-tax states with intense reliance on high marginal income tax rates. Not only are these states more vulnerable to income fluctuations among high earners—an important source of volatility—but in an increasingly mobile environment, they’re driving some of those high earners to other states as well. While only state (not local) tax revenue data are available at a state-by-state level for more recent fiscal years, New York and California’s combined state tax revenue is up 2.9 percent in real terms since FY 2019, compared to 11.3 percent growth in the rest of the country.

To the Editor and Governor Gianforte:

22 December 2023
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I appreciated my time spent on this 95 mill property tax issue with you , the Dept. of Revenue and the Lobbyist for the School Organizations.  I am dis-appointed with the Supreme Court ruling but will abide with it.  The educational value  of researching and understanding how the school, local government and state school funding is calculated on a tax bill was worth the effort.

But Governor, Your press release on this ruling you stated that you are committed to long-term reform “including holding the line on local spending that drives property tax increases.”

You and the ruling just ordered the Commissioners of Beaverhead County to levy an ADDITIONAL  $602,677 on the taxpayers of Beaverhead County.  49 of the 56 Counties across Montana fought hard to control property tax increases this year only to be challenged by You and your Dept. of Revenue to levy an additional $78,774,449 on a statewide level.  So much for driving property tax increases.

Beaverhead County taxpayers need to know that

Beaverhead Co. Accessed  19.65 mills LESS than last year.

City of Dillon  Accessed 24.14  mills LESS than last year.

School Dist. #10  Accessed  29.67 mills LESS than last year.

BCHS Accessed  17.10  mills LESS than last year.

This was all done by local government trying to control the increase of property taxes by following state law.  MCA 15-10-420

In addition, the Agencies  in Beaverhead County that have VOTED MILL ATHORITY, the Boards of those agencies decided NOT TO LEVY the full amount this year because of the extreme increases that we are seeing now.  These decisions kept $348,355 off of the current year tax bills.  Check your tax bills and you will see all levied mills are  less than last year.  Now, the only line on your tax that will remain the same is the first line called State School Levy.

This is where $600,000 of your property tax dollars will go.   This will increase revenue to the State by 34% over last year, almost $99,000,000 State wide.

One final question that needs to be researched,  “Did the local school districts just receive a $99 million windfall statewide???”  When your local school board reply’s NO, does that mean the $99 million really goes into  the State General Fund????

Thanks for allowing me to serve.

Mike McGinley

Beaverhead County Commissioner

Dear Editor:

I would like to thank our Montana Public Service Commissioners Brown, Fielder, Pinocci, O’Donnell, and Bukacek for their diligence in serving and protecting the rights and safety of Montanans.

They have recently ruled that NorthWestern Energy (NWE) is to provide a free, no cost Opt-Out for their installation of Smart/Advanced Meters, including no fees for keeping our old meters or monthly charges. 

Unfortunately, NWE has not given customers proper informed consent with which to make informed decisions.  Smart Meters have never been proven to be safe for human use and exposure. Thousands of research studies indicate harm from long term exposure to this type of constant high pulsed microwave radiation coming out of Smart Meters. These meters will also catch on fire and explode more easily and emit higher levels of dirty electricity.  Smart Meters are contraindicated for those with chronic health conditions and certain medical implants. You can research these negative health and safety effects at https:// www. takebackyourpower.net/ research/

In August 2021, in a historic ruling, a Circuit Court of Appeals in D.C. has ruled that the FCC’s safety guidelines for microwave radiation was inadequate to protect human health.  Yet, Utilities are still continuing to install Smart Meters which violate not only our health and safety, but also constitutional rights to privacy with 24/7 collection of private utility data.  Eventually Smart Meters can be used to track and control your carbon footprints.

Fortunately, we can Opt-Out of these risks by contacting NorthWestern Energy 1-800-486-4280 for an Opt-Out Application.

Mae Woo

Billings, MT

IRS Delays Taxes on $600 Reporting Threshold

22 December 2023
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Small Business & Entrepreneurship Council (SBE Council) president & CEO Karen Kerrigan issued the following response to an announcement by the Internal Revenue Service (IRS) that the agency will again delay implementation of the lower threshold for 1099-K reporting (which went from $20,000 to $600 in the American Rescue Plan) for the 2023 tax year.

“The IRS was wise to make this decision given the potential for massive taxpayer confusion and the general lack of awareness and clarity on the new 1099-K threshold. At least 44 million new forms were expected to flood into the mailboxes of unsuspecting citizens who sell used items online, for example, and many taxpayers receiving these forms would not be required to do anything. But how are they supposed to know that? The absurdity of the new reporting threshold has created a massive make-work scheme for payment apps and online marketplace. It has generated significant waste and depleted resources within both the private sector and at the IRS.”

“Congress and President Biden need to be advancing policies that make things simpler, more efficient, and less costly. The new threshold requirement does exactly the opposite. While we are pleased that the IRS has once again delayed implementation of the new threshold, Congress should repeal this intrusive reporting scheme by passing the Stop the Nosy Obsession with Online Payments Act (SNOOP Act) either separately or as advanced by the House Ways and Means Committee in a broader tax relief and reform package this past June.”

In its announcement, the IRS stated that it will phase in the reporting requirement, and is planning for a $5,000 threshold for tax year 2024 and will eventually get to the $600 reporting threshold enacted under the American Rescue Plan (ARP).

Inflation Dominates List of Concerns of Voters

22 December 2023
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By Tom Gantert, The Center Square

Inflation and price increases are by far the most important issue facing the country.

That’s according to The Center Square Voters’ Voice Poll conducted from Oct. 20-26, 2023, in conjunction with Noble Predictive Insights.

Other top concerns were Illegal Immigration (33%); Crime/violence (28%); Economy/jobs (24%).

The poll data showed that 48% of registered voters said inflation was the most important issue in the U.S. Illegal immigration had the second most support among registered voters at 35%. Crime and violence was the third most popular pick at 27%.

The poll reported that 95% of registered voters said they have seen prices increase over the last few years with 5% saying they have seen no change.

Among those who reported seeing price increases, 96% said the cost of groceries had increased and 82% said the cost of gasoline had increased.

Another 74% said their utility bills had increased.

“It’s not surprising that inflation is the top concern among voters,” said Antony Davies, an economist at Duquesne University. “Today’s grandparents were teenagers the last time Americans faced double-digit inflation. Politicians have done their best to deflect blame to the greed of corporations, leaving unaddressed the question of whether decades of low inflation were due to corporate altruism. The seeds of today’s inflation were laid during COVID when the Federal Reserve was expanding the money supply to pay for multi-trillions in government spending that Washington couldn’t afford.

One measure of inflation is the Consumer Price Index, which the U.S. Bureau of Labor Statistics describes as “a measure of the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services.” 

The BLS bases CPI on the cost of food, clothing, shelter, fuels, transportation, doctors’ and dentists’ services, drugs and other products and services that people purchase on a daily basis.

From 2013 through 2020 in the mid-Atlantic region, the monthly percent increase in CPI ranged from as low as negative 0.2% in April 2015 to as high as 2.9% in June and July 2018.

But in 2021, monthly increases in CPI started occurring. CPI increased by 4.2% in April 2021 and then rose as high as 7% in December 2021. In 2022, the CPI monthly increases ranged from 6.5% to as high as 9.1%.

In 2023, the monthly increases in CPI have hovered at 3.7% in August and September.

The poll surveyed 2,605 voters and included 1,035 Republicans, 1,074 Democrats, and 496 Independents. The poll has a margin of error of 1.92%.

Farmers Among Businesses Required To do More Federal Reporting

20 December 2023
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A new federal reporting requirement aimed at reducing corporate crime will affect some Montana farmers, ranchers and businesses, according to Montana State University Extension.

Beginning on Jan. 1, 2024, certain corporations, limited liability companies and other entities created or registered to do business in the U.S. will be required to report information about their beneficial owners to the Financial Crimes Enforcement Network, or FinCEN, within the U.S. Treasury Department.

The new reporting requirement stems from the Corporate Transparency Act, passed by Congress in 2021. It is part of the U.S. government’s efforts to make it harder for bad actors to hide ill-gotten gains through shell companies or opaque ownership structures.

A beneficial owner is an individual who has substantial control over or owns at least 25% of a company.

A company created before Jan. 1, 2024, must file an initial report with FinCEN no later than Jan. 1, 2025. A company registered on or after Jan. 1, 2024, must file with FinCEN within 30 days of registration. Companies will have an ongoing obligation to file an updated report with FinCEN to disclose any changes in previously reported information or to any beneficial owner within 30 days of the change.

Montana farmers, ranchers and businesses can file reports with FinCEN electronically. The form to report beneficial ownership information will not be available until Jan. 1, 2024. Information about the form can be found at fincen. gov/boi.

MSU Extension provides links to FinCEN materials that provide information about the new reporting requirements which can be found at montana.edu/ estateplanning.

Court Vacates Coal Mine’s Permit

20 December 2023
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In a unanimous Opinion, the Montana Supreme Court has upheld a lower court ruling that vacated the State permit that allowed the expansion of the Rosebud coal mine in Colstrip,Montana.

In 2015, the Montana Department of Environmental Quality (DEQ) issued a permit for additional mining to Westmoreland Rosebud Mining. Several conservation groups challenged the permit, arguing it was issued in violation of the legal requirements of the Montana Strip and Underground Mine Reclamation Act.

A district court in eastern Montana agreed and vacated the permit, halting mining activities in the expanded area. However, the Montana Supreme Court temporarily reinstated the permit pending resolution of the legal issue. State law is based on federal requirements for regulating strip mines.

The Supreme Court ruled that the Board of Environmental Review (the Board) made several errors when it upheld DEQ’s finding that Westmoreland had demonstrated that the proposed mining activity is designed to prevent material damage to the hydrological balance in the area.

During the permitting process, Westmoreland acknowledged a projected 13% increase in salinity in the alluvium of East Fork Armell’s Creek from the proposed mining activities.

Although the additional salts in the alluvium would not be a statistically significant concentration, they would increase the length of time during which higher pollutant levels would be present. The Court held that the Board did not adequately analyze whether extending the duration of an existing water quality violation satisfied the legal requirements. Further, the Court ruled that the Board failed to properly consider the cumulative impacts of increased mining activity on the area water quality. The ruling halts mining expansion into Area B of the Rosebud Mine and sends the permitting process back to the Board for additional review.

Americans Moving from High Tax States

20 December 2023
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What do The Rolling Stones, NFL star Tyreek Hill, and Maryland millionaires have in common? They all moved because of taxes.

You may not be a famous musician or a pro athlete, but you too may have considered taxes in deciding, “should I stay, or should I go?” Or maybe not. While high-profile stories abound, what do the data tell us about taxes and migration? Do people—regular people—really move because of taxes?

The answer is complicated, but one thing is clear: Americans are moving from higher-tax states to lower-tax states. This alone doesn’t prove anything, but the most recent IRS data seem to show a connection between taxes and migration:

* Nine of the top 10 states with the largest population gains from 2019 to 2020 have no or low individual income taxes (the most visible of all the tax types, and highly connected to where you live).

* Of the states that saw more income tax filers move in than out, nearly 80 percent had below-average state and local tax collections per capita in fiscal year 2020, while half of the states that experienced more filers moving out than in had above-average collections per capita.

* Similarly, 19 of the 28 states with more people moving in than out had a top marginal income tax rate below the national median, while 16 of the 22 states plus D.C. with more people moving out than in had above-median top income tax rates.

* Among the 25 best-ranking states on the 2020 State Business Tax Climate Index, 20 states gained taxpayers between 2019 and 2020. Among the 25 worst-ranking states on the Index, 17 lost taxpayers to interstate migration.

Of course, correlation does not equal causation, so how do we know taxes play a role in people’s location decisions?

One clue: most studies have found that state and local taxes affect migration, and the effect seems to have become stronger over the years—probably because technology has made it easier for people and businesses to move.

Another clue: survey data. An annual Census Bureau survey asks people who moved why they did it. Though it doesn’t ask about taxes directly, respondents’ answers reveal the indirect influence of taxes. For example, in 2017, 16 percent said they “wanted [a] new or better home,” 11.5 percent said they moved “to establish own household,” and 8.3 percent “wanted cheaper housing,” all of which are influenced by property taxes. And the 9.9 percent who moved for a “new job or job transfer” likely took into account income taxes and benefited from the job opportunities related to the state’s economic competitiveness.

Though people move for many different reasons, the evidence suggests taxes are at least one factor—both directly and indirectly. All things being equal, people prefer lower taxes. They also favor many of the things that a well-designed tax code helps facilitate, like a strong job market and a reasonable overall cost of living.

When people move out of a state, they take their earning power with them. IRS data from 2019 and 2020 shows that most states that lost people to interstate migration also lost adjusted gross income (AGI). Conversely, most states that gained people also gained AGI.

For example, in 2021, California and New York lost $29 billion and $25 billion in AGI, respectively, while Florida gained $39 billion.

And less income in the state means less tax revenue. In 2021, California lost $343 million while New York lost $300 million.

Evidently, people’s migration decisions can affect a state’s economy and budget.

While experts generally agree that taxes play some role in people’s decisions about where to live and work, they disagree over the significance. Some argue that the influence of taxes on migration decisions is so small, policymakers shouldn’t even consider it when designing tax policy.

But policymakers only have so many tools at their disposal to attract people. Not every state can offer warm weather and nice beaches. But they can control their taxes. Prioritizing structurally sound tax policy with low rates will not only lower people’s tax burdens—which clearly attracts some people—but also produce economic growth, increasing the job opportunities and wages that attract others.