Legislative Update

Personal income tax increase bill tabled in committee: House Bill 64, sponsored by Representative John Kowalko (D-Newark) would add three new tax brackets to Delaware personal income tax statute as follows: at $125,000 with a rate of 7.10%, at $250,000 with a rate of 7.85%, and at $500,000 with a rate of 8.6%. The bill was heard in the House Revenue and Finance Committee on Wednesday, March 24.   At the committee hearing, Delaware Secretary of Finance Rick Geisenberger spoke on behalf of the Carney Administration in opposition to the legislation. The New Castle County Chamber of Commerce and other business groups also spoke against the bill. 
  
The New Castle County Chamber argued that the bill is unnecessary. Based on the most recent projections from the Delaware Economic and Financial Advisory Council, there is currently a roughly $600 million structural budgetary surplus.  Hence, even without federal assistance, resources are more than sufficient to fund the Governor’s Recommended Budget package while appropriating to address additional needs.  Additionally, state government is slated to receive $1.25 billion in funds from the recently passed American Rescue Plan Act of 2021.
 
Secretary Geisenberger and the Chamber also argued that the legislation would negatively affect Delaware’s economic competitiveness, encourage capital flight, increase dependence on capital gains and business tax revenue, and ultimately increase the volatility of personal income tax revenue – a critical revenue stream.  
 
In a vote of 7-to-6, the legislation was tabled in committee. STATUS: Tabled in committee.
 
“Delaware Marijuana Control Act” released from committee: House Bill 150, legislation which sets forth a statutory scheme that is similar to that which licenses, taxes and regulates alcohol, was released from the House Health and Human Development Committee on Wednesday, March 24. 
 
During the hearing, many advocates testified in support of the legislation.  AAA Mid-Atlantic spoke in opposition to the bill based on traffic safety concerns. Business organizations expressed a need to clarify the ability of employers to maintain a zero tolerance policy for marijuana use. The New Castle County Chamber of Commerce, as well as the Associated Builders and Contractors, expressed opposition to language which would favor license applicants who enter into labor agreements and use project labor agreements for the construction and retrofit of facilities.  STATUS: Released from House Health and Human Development Committee and placed in House Appropriations Committee due to fiscal impact.
 
General Assembly in session on Tuesday, Wednesday, and Thursday of this week:
The Senate will reconvene Tuesday, March 30 at 3:00 p.m.   To view their agenda, visit https://legis.delaware.gov/Agenda/Senate. To view the Senate in session, visit https://legis.delaware.gov/WatchAndListen?view=1 On Wednesday, March 31, the Senate will convene at 4:00 p.m., after committee hearings. On Thursday, April 1, Senate session will begin at 2:00 p.m.
 
The House will hold votes on Tuesday, March 30 at 3:00 p.m. Wednesday, March 31 will be a committee day with no floor votes.  On Thursday, April 1, the House will hold votes beginning at 3:00 p.m. To view the House in session, visit https://legis.delaware.gov/WatchAndListen?view=1.  To view the House agenda (when posted), visit https://legis.delaware.gov/Agenda/House.  
 
For a schedule of House and Senate committee hearings for the coming week, with links to agendas, and links which allow you to register and participate, visit https://legis.delaware.gov/CommitteeMeetings. 
 
Easter Break for the General Assembly begins on Friday, April 2 and ends when they reconvene on Tuesday, April 20.