Jan Teague

President/CEO

360.943.9198, ext. 19

jteague@retailassociation.org

Mark Johnson

Vice President of Government Affairs

360.943.9198, ext. 15

mark.johnson@retailassociation.org

Tammie Hetrick

Vice President of Retail Services (RASI)

360.943.9198, ext. 13

 tammie@retailassociation.org

Jim Szymanski

State pension plans need more

By Jan Teague, President/CEO

At a recent meeting with the Legislature's Select Committee on Pension Policy, I learned that the legislature will have to figure out how to increase its funding for state pensions. 

The problem is that the assumptions keep changing for cost projections. Workers are not retiring as expected and for each year they keep working, the pension liability increases.  Retirees are living longer than expected, which increases pension costs.

There are optimistic assumptions for how much investments will return to the fund, which is always a slippery slope.  The entire liability is now estimated at $4.4 billion dollars and current estimates are that the pension plans are only 94 percent funded.  The number being tossed out for next year's 2-year budget is $482 million with another $529 million for the 2017-19 budget cycle.  The committee was reminded that there is a looming state Supreme Court lawsuit out there that might increase the pension costs as well.    

The list of costs for the state budget is growing.  I expect that next session is going to be very contentious and it's just six months away.  

Utility taxes are part of a funding discussion

By Mark Johnson, VP Government Affairs

I attended a House Finance Committee interim work session on Monday about county government funding.  Many county governments, like the state and many cities, are strapped for cash. 

Counties derive their funding from three main sources:  property tax, sales tax and shared revenue with other governmental entities.  With the economy downturn, the effects of the Growth Management Act and the impacts of two voter-approved tax reduction initiatives, some counties are feeling the pinch to meet service demands.  By far the largest portion of a county's budget is for law enforcement/criminal justice, anywhere from 66 percent to 74 percent.

The Finance Committee members asked the county representatives many questions.  The counties have three strategies to try to meet their obligations.  One, cost reductions; two, flexibility of current revenue streams; and three, diversification and enhancement of existing revenues.  The word "enhancement" is government code for "new taxes." 

One of the areas counties would potentially like to see go is getting the authority from the state to levy a utility tax.  Counties argue that a utility tax is broad based and relatively stable even through economic downturns.  Cities now have the authority to levy a utility tax.

WRA is concerned about a potential increase in the utility tax.  Our members pay considerable amounts in taxes to the federal, state, and local governments.  Perhaps a more prudent approach would be flexibility with existing revenue streams. 

Also, a wholesale review of what counties are required by law to do might be in order.  Is it possible to gain efficiencies by reducing duplication of services within counties, such as water districts and services provided by cities within the counties?  These points were made at the meeting by legislators. 

There was also reluctance by some members of the committee to approve new revenue streams for counties until their current unused capacity is thoroughly examined.  One of the members of the committee is a former county official, which was helpful to gain perspective.

WRA will work with our partners in government at all levels to help them meet their responsibilities while at the same time maintaining a vibrant and healthy business climate.

WRA auto members warned about costly state audits

By Tammie Hetrick, VP Retail Services

Recent surprise state audits of auto repair and tire stores drive home the need for employers to assign their employees to the correct workers' compensation insurance risk class.

Failure to do so can result in expensive fines that can total several thousands of dollars.

Put simply, desk bound employees who answer phones or work at a computer, also known as clerical tasks (classification 4904), cannot include walking through a service shop as part of their normal workday. If so, they must be reclassified to a higher risk insurance class for which insurance is more expensive than coverage of a clerical employee.

Employees classified under 4904 are not allowed in shop areas for any reason, for insurance purposes. Such employees must remain at a cash register/computer or answer phones or they risk causing a fine for the company if detected in a state audit.

Any members concerned about whether they are paying into the correct risk class should contact me at 360-943-9198, Ext. 13 or at Tammie@retailassociation.org. 

Seattle businesses petition for public vote on minimum wage law

Seattle small business owners have begun collecting signatures to force a November public vote to determine whether the minimum wage would rise to $15.

Forward Seattle, the small business coalition, learned this month that it could not vote to amend the city charter seeking a public vote until next year. Meanwhile, earlier this month, without a public vote, the City Council unanimously approved an ordinance to raise the city's minimum wage, starting in April, to $15. It currently would be the highest minimum wage of any city in the country.

Concerned businesses continue to express concerns about a 61 percent increase in payroll costs. They predict results will be layoffs, reduced employee benefits, higher prices and possibly an exodus of some businesses to cities with lower minimum wages. The state's current $9.32 an hour minimum wage is the nation's highest state rate.

Forward Seattle has until July 3 to collect 16,510 valid signatures of Seattle voters to qualify for a November public referendum. Visit the group's website to learn more.

The Seattle ordinance has prompted a flurry of various legal and electoral maneuvers to either repeal it or prevent other governments from setting wages.

The International Franchise Association (IFA) and Seattle franchises have sued in Seattle federal court to block the law on grounds it is discriminatory.  It considers small franchises affiliated with national chains as big businesses. That means small franchises must comply with the Seattle law within three years while larger non-franchise businesses, as long as they have fewer than 500 employees, would get up to seven years to comply.

In a Wall Street Journal opinion piece, (subscription required) IFA's chief executive maintains that cities have structured similar pay ordinances to make it easier for labor unions to organize smaller businesses such as the franchises.

West Seattle political activist Craig Keller also is gathering signatures for a Seattle referendum later this year at www.SaveOurChoice.us. There also are state initiative efforts underway in an attempt to retain uniform minimum wages across the state.

Many observers expect it may take until the end of next year to settle the debate in Seattle and statewide.

Airport minimum wage could rise to $13 in three years

Port of Seattle commissioners are scheduled to vote next week on a proposal to increase the minimum wage of Seattle-Tacoma International Airport airfield and support workers to $13 in three years and add paid sick leave.

The hourly minimum would rise to $11.22 in January and to $13 in January, 2017. The year after that, airport minimum wages would increase annually on a percentage basis reflecting the rate of inflation, according to a Port of Seattle announcement.

The current statewide minimum wage is $9.32, the nation's highest, but the Seattle City Council has approved an ordinance, currently under legal challenge, to raise the minimum to $15 within three to seven years. Businesses with more than 500 employees would have to make the higher target within three years. Businesses smaller than the threshold would get up to seven years to comply.

Voters of SeaTac, where the airport is located, voted to approve a $15 minimum wage for transportation and hospitality workers who service the airport. But a King County Superior Court judge ruled that only the port, not city voters, could set wages at the airport.

Meanwhile, the state Supreme Court Thursday is scheduled to hear arguments about whether SeaTac's $15 minimum wage, passed as Proposition 1 on last fall's ballot, can be enforced at the airport.

Sources: Port of Seattle, Seattle Times

Businesses react quickly to Seattle $15 minimum wage

Higher prices, reduced employee hours and benefits and tempered expansion plans all are under consideration by Seattle businesses reacting to the city's new $15-an-hour minimum wage law, The Seattle Times reported this week.

The paper sampled four businesses whose representatives each talked about the economic ripples from the law requiring employers to eventually increase payrolls up to 61 percent higher than the current statewide minimum of $9.32, the nation's highest statewide amount. The $15 target is currently the nation's highest for any major city.

Seattle's small franchise owners have sued to block the law, which goes into effect next April. There also are signature campaigns aimed at conducting a city referendum to repeal the law and later to amend the city charter to prevent city elected officials from setting wages.

The franchise owners object to being required to raise wages within three years when other small businesses will have up to seven years.  Click here to read more about this issue.

Seattle hotel owner Ron Oh told The Times he plans to raise room rates and reduce employee hours. One restaurant owner estimated his profits will be cut in half due to higher payroll costs, which would force a reduction in health care benefits. An owner of a business with locations in several cities wondered whether the ordinance could cause a rift with employees at locations in Bellevue, Bremerton and Everett.

All such predictions and more were testified to before the City Council unanimously approved the ordinance earlier this month.

Inslee backs minimum wage hike

In a recent meeting with newspaper editors in Vancouver, Gov. Inslee repeated his support of a statewide minimum wage hike.

Inslee was quoted in a report following an appearance before The Columbian's editorial board.

Inslee raised the issue in his 2014 state-of-the-state speech but a bill to raise the minimum wage from the current $9.32 stalled in the 2014 legislative session. The Columbian report does not mention a specific higher minimum wage suggestion.

Click here to read the entire newspaper account.

Source: The Columbian 

WRA joins letter to rescue the Export-Import Bank

WRA joined in signing a letter this week urging Congress to reauthorize the Export-Import Bank, whose charter could expire September 30 unless lawmakers act.

More than 800 associations, chambers and companies signed the letter including the U.S. Chamber of Commerce and the National Association of Manufacturers.

The bank is critical to retail trade because it provides business loans and guarantees to exporters when other financing sources may not be available. Last year, the bank supported $37 billion in exports that sustained 200,000 American jobs at 3,400 companies.

Two authors in a Seattle Times opinion piece this week, a customer and the President of the Washington Council on International Trade, outlined the benefits of the bank to Washington State:

*It supported at least 137,000 Washington jobs in the past year.

*More than 70 percent of the 165 employers that have used the bank the past five years were small and medium-sized businesses.

*The bank supports Washington, which exports more than double the national average. At least 40 percent of the state's jobs are tied to trade. Last year, exports from Washington rose to a record $82 billion.

*Bank financing makes it easier for U.S. companies abroad to compete in the global marketplace.

*The bank has supported $91 billion in sales of Washington products in foreign countries the past five years.

The House Financial Services Committee is scheduled to hold hearings on the bank today.

Source: U.S. Chamber

Spokane paper supports survival of Ex-Im Bank

The Spokesman-Review newspaper this week called attention to the threats faced by the Export-Import Bank and how businesses throughout the state could be harmed.

Boeing is among the bank's beneficiaries in the most trade dependent state in the nation.

The paper's editorial urged Congress to reauthorize the bank for continued operation later this year. The commentary also offers additional background on the politics of the issue.

Voters support tighter limitations on tax increases, new poll shows

Despite the state Supreme Court overturning supermajority requirements of government to pass new taxes, voters continue to support it, a new poll shows.

The Washington Policy Center reports on the May, 2014 statewide poll that concluded that 63 percent of voters lean in favor of a two-thirds majority before a governmental body can increase taxes.

The policy center's blog post notes that state voters had approved supermajorities five times before the Supreme Court declared it unconstitutional last year. The latest polls are noteworthy as a majority of state legislators are running for re-election this fall.

Click here to read the entire blog post.

Source: Washington Policy Center

Good time to comply with hazardous drug rule

Pharmacy employees and delivery personnel are among the occupations under alert to comply by this coming January with a new state law to protect employees from dangerous chemicals.

WRA members most likely affected by the new law would be pharmacy employees and shippers. Improper exposure to certain hazardous drugs can cause several reactions including rashes, genetic damage, birth defects and cancer.

Information from the state can be found here.  Labor and Industries has assembled a hazardous program guide for pharmacies.  Timelines and check points for the phased-in law can be found here.

Source: L&I

Safety tip: (one in a series)

Check out RASI's new Safety channel on YouTube

WRA's subsidiary, Retail Association Services, Inc. has launched a safety channel of YouTube videos that can be helpful for selecting safety meeting topics and for training new employees.

The channel includes a playlist of groupings for topics including lifting and back safety, distracted driving, ladders and more.  The site allows visitors to watch the entire playlist or select individual videos.  WRA Safety and Claims Administrator Rick Means plans to expand the categories and the video selection with an eye toward matching topics to the most common safety issues faced by retailers.

Another option is to scan the LNI video library.  After obtaining an account, users can review the offerings and order a disc to be sent to them. The lineup includes some presentations in Spanish.

For those companies committed to operating safety, these libraries are better than Netflix because there are no monthly fees.

Rick is available to WRA members to help draw up safety plans and suggest topics for safety meetings. Contact him at 360-943-9198 x18, or rick.means@retailassociationservices.com.  

Seattle business tax workshop set for July 2

The Department of Revenue will host a free workshop on July 2 in Seattle to help businesses learn which taxes to report.

The workshop will be from 1 p.m. to 4 p.m. at 2101 4^th Avenue, Suite 1400 in Seattle. Those who attend will receive a workbook with a reference guide to Revenue's rules and regulations.

To register, call 206-727-5300 or register online.

Revenue offers several ways for businesses to learn about taxes. For those who can't attend this month's workshop, there is a complete schedule of workshops statewide and a short streaming video version of the workshop available on the website

Source: Revenue

Thurston bag ban starts next week

On July 1, retailers in Lacey, Olympia, Tumwater and unincorporated Thurston County will be prohibited from using most plastic shopping bags available on the market today.

The ban is aimed at plastic carryout bags 2.25 millimeters or thinner that normally are distributed to shoppers. Thicker plastic bags are considered reusable and will have no restrictions.

There are numerous exceptions to the law. Plastic used to bag bulk items, produce and meat is exempt. Also exempt are plastic bags used for dry cleaning and garbage and for wrapping newspapers. Finally, bags used to wrap prepared take-out food are allowed for public health reasons.

All vendors are required to charge a minimum of five cents for paper carryout bags that are one-eighth barrel or larger, which is the size of a typical grocery bag. Retailers can keep the entire fee to help defray the cost of the more expensive paper bags.

WRA favors greater use of recycling and the use of cloth reusable bags as an alternative to plastic bag bans. The current patchwork of bans in various communities throughout the state reduces choices for consumers and presents a confusing and expensive network of exceptions for retailers with multiple store locations.

Go to www.ThurstonSolidWaste.org/plastics to read the ordinance, tips to encourage customers to bring a bag to the store and guidelines for safe use of reusable bags. The site also allows retailers to download signs to remind their customers about the ban.

Shippers save thousands of dollars with WRA partner

Shipping customers saved an average $3,100 in 2013 by shipping with PartnerShip, a partner with WRA.

Enrolled WRA members can save up to 27 percent on select FedEx services.

WRA encourages all members to explore this service. Visitwww.PartnerShip.com/99WRA to enroll. Shipping customers with further questions are encouraged to call Partnership at 800-599-2902 or e-mailsales@PartnerShip.com. You also may click here to receive a free rate analysis to help with your shipping decision.

Help elect pro-retail candidates by donating to the PAC

By Mark Johnson, VP Government Affairs

The election season is upon us.  This is an important year with all of the state House members and half of the state Senate up for election. 

WRA's Retail Action Council Political Action Committee, or as we call it the RAC PAC, will be a major player in helping elect pro-retail candidates to the legislature.  Our process is very involved and thorough to ensure the greatest chance for success. 

First, we are diligently working on a voting record for all current members of the legislature.  We select approximately 10 bills per chamber that we were involved in and score the legislators on whether they voted with us or sponsored something we liked or didn't like.  We then combine the 2014 scores with the 2013 scores for a biennium or two-year total.  This gives a better representation of the legislators overall support or lack thereof.  Once the voting record is done the RAC PAC will make its first round of endorsements. 

Surveys will be sent to all candidates who don't have a voting record and who have filed to run for the legislature.  After scoring the surveys we will decide which candidates to interview based on their scores and the viability of their districts to elect them.  Recommendations will then be sent to the RAC PAC for consideration of endorsements and contributions.

RAC PAC contributions are very important to help the pro-retail candidates to get the word out.  Yard signs, letters, websites, radio, bill boards and TV all cost money.  A contested House race can run anywhere from $100,000 to $300,000 and an average Senate race can cost upwards of $500,000. 

Individual donation limits to candidates this year are $950 per election, so for the primary and general you can give $1,900.  Contributions to PACs are unlimited.  We can also accept corporate dollars.

In order to secure a pro-retail legislature it is critical that contributions to the RAC PAC be made.  If you are in a position to donate please mail a contribution made out to:  The Washington Retail Association Retail Action Council PAC, P.O. Box 2227, Olympia WA  98507-2227.  We appreciate all of the WRA members who have already donated.

If you would like to discuss giving opportunities please give me a call directly:  360-943-9198 ,  Ext. 15  We appreciate your serious consideration of this very important component of our political program.

Save the date for the 2014 business fair

Organizers have settled on Sept. 27 for this year's annual small business fair at Renton Technical College.

WRA is an annual exhibitor at the fair, where speakers address numerous seminars on starting and growing a small business. Admission is free.

Look for updates as they occur at www.bizfair.org. Also, look for periodic announcements on the Business Fair Facebook page.