The following column originally .

There is a concerted effort underway in Washington to undermine and overturn the very policies that have made states like ours economic leaders.

One of our states, Texas, does not have an income tax, while Arizona just a low flat income tax. Our states’ regulatory burdens are light, education innovation is encouraged, and parents have choices where they send their kids to school. We are also right-to-work states, meaning labor union membership is strictly voluntary.

That our states embrace policies like these makes it no coincidence that we regularly show up on lists of the country’s fastest-growing states or states that offer the best business environments.

But some officials on Capitol Hill and within the Biden administration have spent the past several months attempting to put handcuffs on our pro-growth strategy.

When the American Rescue Plan Act passed in March, Treasury officials told states they better not think about cutting taxes. The administration later that states could extend relief to their taxpayers under certain circumstances, which were laid out in a Treasury that makes its point in a brisk 150 pages.

Congress got in on the micromanagement act and added a dose of fealty to anti-school-choice special interests with buried in an appropriations bill that says public charter schools shouldn’t be able to contract with private sector entities like school lunch providers or back-office help if they want to maintain access to federal funds. Some schools might be forced to shut down and their students would be left in the lurch, but maybe that’s the point. Not surprisingly, the bill says nothing about educational quality or student performance.

Congress and the administration come together in bigfooting the states on the Protecting the Right to Organize, or , which would eliminate voluntary union membership and states’ right to work laws. The bill has and Senate Majority Leader (D-N.Y.) says he’ll bring his chamber’s version of the bill to a vote if he can convince a few more Democratic holdouts to come on board.

Not only does the PRO Act crowbar union-backed labor policy into states’ workplace laws, but it eviscerates labor mobility and worker choice.

Want to be an independent contractor? Not so fast, says the PRO Act, which attempts to bring California’s unpopular AB 5 law — which voters there amended last November after app-based gig workers protested — to the rest of the country, making it much harder to be an independent contractor. Fewer independent contractors means more potential union members.

These heavy-handed top-down approaches to lawmaking not only turn federalism on its ear, but they also create a drag on the post-pandemic economic recovery at the very moment we should be incentivizing creative thinking to spark job growth. Instead, Congress and the administration have embraced the tedious sort of policies that have caused millions of Americans to pull up stakes and move to more welcoming economic climates like ours.

Arizona and Texas have proven that if given the opportunity to innovate in our laboratories of democracy that we can help cultivate environments that encourage and accelerate job growth. If you’re looking for examples on how to bounce back after more than a year of pandemic-induced disruptions, look to our states.

Our states are moving quickly. We don’t expect that Washington will take a lesson from us, but it shouldn’t force us to adopt policies that will only slow us down.

Danny Seiden is the president and CEO of the Arizona Â鶹´«Ă˝Ół»­ of Commerce & Industry. Glenn Hamer is the president and CEO of the Texas Association of Business.

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Arizona U.S. Senators Kyrsten Sinema and Mark Kelly updated the business community on legislation important to industry and commerce Wednesday during the Arizona Â鶹´«Ă˝Ół»­ of Commerce & Industry’s annual 2021 Update from Capitol Hill.

The two senators detailed measures in the recent federal relief package that will benefit businesses in Arizona and priorities for the rest of 2021. They also fielded questions about top business concerns including corporate tax rates, preservation of the filibuster, and the feared Pro Act, which has been labeled “the worst bill in Congress” by many in the business community.  

Neil Bradley, executive vice president and chief policy officer of the U.S. Â鶹´«Ă˝Ół»­ in Washington, D.C., also offered an insider view into the goings on in the nation’s capital as far as business is concerned. More than 500 attended the virtual event, which was sponsored by Salt River Project and the Arizona Indian Gaming Association. 

How businesses are benefiting from recent federal relief bill 

Senator Sinema (D) talked about measures she has successfully supported and lobbied for in the federal relief packages including the most recent $1.9 trillion .

Sinema emphasized her record of working across the aisle despite criticism from party loyalists at times. For her, ensuring that Arizona employers and employees weather the pandemic is her first priority, not party politics, she said.

“Over the past year, employers have had to make tough choices, adapt, and contend with bureaucratic obstacles that delayed relief,” Sinema said. “That’s why as a member of the Senate bipartisan group on Covid relief, I listened closely to Arizona leaders and worked to ensure that the new relief law addresses Arizona’s urgent needs.” 

Among the measures Sinema helped to pass are:

Restaurant relief fund: Sinema and Sen. Roger Wicker, R-Miss., introduced and helped pass a restaurant relief fund of $28.6 billion to help small and mid-sized restaurants, bars, caterers, food trucks, breweries and other food service providers in need of assistance with rent and operational expenses. It provides grants of up to $10 million per entity with a maximum of $5 million per location based on the difference between 2020 and 2019 revenue. 

Save our Stages Act This legislation created a $15 million fund to provide relief to the entertainment industry like nightclubs, theaters and concert halls. 

Employee Retention Tax Credit This is a refundable against certain employment taxes equal to 50 percent of the qualified wages an eligible employer paid to employees after March 12, 2020, and before January 1, 2021. Eligible employers can get immediate access to the credit by reducing employment tax deposits they are otherwise required to make. Also, if the employer’s employment tax deposits are not sufficient to cover the credit, the employer may get an advance payment from the IRS.

CHIPS for America Act Another bipartisan effort led by Sinema resulted in the CHIPS Act being adopted in December. The CHIPS Act — Creating Helpful Incentives to Produce Semiconductors — established federal grants to enable advanced research and development, secure the supply chain and ensure long-term national security and economic competitiveness. 

Soon after Congress passed the act, announced a $20 billion expansion of its manufacturing operation with two new factories in Arizona, Sinema said. The project is expected to create more than 3,000 permanent, high-wage jobs and more than 3,000 construction jobs, beginning this year. 

Relief for border communities The measure provides $110 million to help border cities and towns overwhelmed trying to provide humanitarian aid to asylum seekers flooding across the border. 

Looking ahead: immigration, infrastructure, broadband

Sen. Kelly, who stepped into public office in December, said he spent his first five months doing a “lot of listening” to ascertain what is the most effective use of federal dollars in Arizona. Protecting public health while encouraging economic development are top priorities. 

“There’s a lot of work ahead to beat this virus and rebuild our economy. That’s been my focus,” said Kelly, who also spoke about his commitment to working in a bipartisan manner. 

In the coming months, Kelly said he is focused on a number of packages with business in mind including:

Infrastructure Congress has failed to pass a major infrastructure bill in the past but there could be enough momentum to get it done this year. The bill would include funding for not only roads and bridges but water and wastewater facilities and the expansion of broadband to shrink the digital divide between the haves and the have nots.

Immigration reform Another top priority is to finally pass immigration reform to secure a future workforce for the state and provide a pathway to citizenship for longtime immigrant employees as well as Dreamers, young adults who were brought here as children by their undcoumented relatives.

Upgrades to ports of entry Keeping the border secure and expanding trade in Arizona will require investing in new technology and infrastructure at ports of entry, another key goal, Kelly said.

“The federal government is failing our state when it comes to border security,” Kelly said. “We need a secure, orderly and safe process at the border.”

Business worries: corporate taxes, filibuster, the PRO Act 

U.S. Â鶹´«Ă˝Ół»­ executive Bradley rounded out the event by touching on a number of concerns to businesses. 

One is the growing national debt from three massive Covid relief packages, topping $5 trillion. In order to accomplish an infrastructure package and other important projects, federal relief in the last round should have been more focused and targeted to real need, he said.

“When you think of last spring, we knew Congress had to provide broad based support. But what we’ve seen is not every family, every industry and every state needs relief,” Bradley said. 

Bradley also talked about President Biden’s proposal to raise the corporate tax rate from 21 to 28 percent. He does not believe the measure has enough support to succeed, but if it does, it will risk the progress Arizona and the nation have made in becoming more globally competitive, he said. 

Changing the corporate tax rate would likely reverse the successes that followed passage of the Tax Cuts and Jobs Act of 2017, he said. Prior to the Act, the nation had one of the highest corporate tax rates in the world. American companies were looking abroad for growth and new investment. 

“Tax changes would give a leg up for competitors abroad. Why would we want to do that?” he said.

When asked about efforts by many Democrats in Congress to remove the filibuster, Bradley said that would likely hurt the nation, too. With strong division between the right and the left, the filibuster ensures that that congressional members have to work to find common ground, he said.

Another concern is the proposed PRO Act of 2021, which also does not appear to have strong support in Congress, Bradley said. The Act would force employees to pay union dues regardless of whether they support a union, threaten private ballots in union elections, and strip workers of their independent contractor classification.

It’s an issue that is extremely worrisome to Arizona businesses, said Garrick Taylor, interim president and CEO of the Arizona Â鶹´«Ă˝Ół»­. 

“This proposal is a litany of almost every failed idea from the past three decades of labor policy,” Taylor said. “It would undermine workers rights, most likely trap employers in a maze of labor disputes and force individuals to pay union dues regardless of their wishes.”

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Congress approved a new $1.9 trillion stimulus package Wednesday to help carry the nation through the final stage of the pandemic. Out of that, Arizona expects to receive about $12 billion for aid to businesses, schools, families and others still struggling from pandemic shutdowns and disruptions. 

After several hours of testimony on the House floor, the measure, which was passed by the Senate on Saturday, was approved along party lines, 220-211, with all Democrats in support. Passage of the bill comes as expanded unemployment benefits are set to expire Sunday.  

President Joe Biden issued a statement celebrating the bill’s passage, saying he is ready to sign it into law. 

“This legislation is about giving the backbone of this nation — the essential workers, the working people who built this country, the people who keep this country going — a fighting chance,” Biden said.  

Main Street support

Corporate America and Arizona business leaders expressed reservations about the bill’s size and scope.

“The business community and state leaders will be poring over this bill in the coming days to better understand all of its implications,” said Garrick Taylor, interim president and CEO of the Arizona Â鶹´«Ă˝Ół»­ of Commerce & Industry. “This bill, obviously, contains more than just targeted spending directly related to the fallout of the pandemic, but its inclusion of public health funding and tools to end the scourge of this pandemic once and for all is welcomed. Widening and accelerating the distribution of the vaccines is essential to relieving the pressure on our healthcare system and getting the broader economy back to full strength.”

Here’s what’s in the rescue plan

Here’s what the American Rescue Plan Act means for businesses, schools, families and others still struggling from pandemic shutdowns and disruptions. 

Restaurants, bars and food service providers: A dedicated relief fund of $28.6 billion is intended to help small and mid-sized restaurants, bars, caterers, food trucks, breweries and other food service providers in need of assistance with rent and operational expenses. It provides grants of up to $10 million per entity with a maximum of $5 million per location based on the difference between 2020 and 2019 revenue. 

Small businesses low-interest loans: The package provides $15 billion to theEmergency Injury Disaster Loan program for small businesses to receive to low-interest loans from the U.S. Small Business Administration (SBA). Advances for small businesses of up to $10,000 may be converted to grants if used to cover business’s operating expenses. The smallest companies, those with fewer than 10 employees, will be given priority for some of the funding.

Paycheck Protection Program : Provides an additional $7.25 billion for the PPP program. Expands eligibility to 501(c) nonprofits (except 501c4) and larger nonprofits, as well as internet-only news and periodical publishers. However, the Act does not extend the PPP’s current application period, which closes on March 31.

Voluntary tax credits for employers: A provision in the package offers tax credits for employers who voluntarily provide paid sick and family leave pay for people who are sick, quarantined or caring for a sick relative or child. 

Reauthorizes state Small Business Credit Initiative Act of 2010: Provides $10 billion to support small business financing to be expended by September 30, 2030. 

Economic Adjustment Assistance : Provides $3 billion for competitive technical, planning, and public works and infrastructure assistance to regions experiencing adverse economic impacts. Available until September 30, 2022.

Payroll Support Program : Provides $14 billion to air carriers and $1 billion to contractors. 

Extended and expanded unemployment benefits: Unemployed workers will receive an additional $300 to their weekly benefit through Sept. 6. The Pandemic Unemployment Assistance program in the plan also provides benefits not only to traditional W-2 workers but also to independent contractors, gig workers and freelancers affected by the pandemic. 

Tax-free unemployment benefits: The first $10,200 of benefits is non-taxable for households with incomes under $150,000. Additionally, the act provides a 100 percent subsidy of COBRA health insurance premiums to ensure that the laid-off workers can remain on their employer health plans at no cost through the end of September.

Families and individuals: The bill provides direct payments of $1,400 to individuals earning up to $75,000 a year and families earning up to $150,000. Individuals who make under $80,000 and families that earn under $160,000 also will receive a smaller amount. 

Tax credits for children: Qualifying families with children 6 and under will be able to claim a larger tax credit of $3,600 per child and $3,000 for each child under 18 for 2021. 

Housing assistance and mortgage and rent relief: Approximately $40 billion will go for housing assistance, including $21.5 billion to be divided up among state and local governments to help low-income households with rent and mortgage assistance and utility bills.

The plan also provides $350 billion in aid to state and local governments; $170 billion for K-12 schools, colleges and universities to reopen; and over $100 billion for health care, including COVID-19 testing and vaccine distribution. 

What’s not in the package

Minimum wage hike: A controversial measure to raise the minimum wage did not survive an earlier version of the rescue plan. The measure would have more than doubled the minimum wage from $7.25 to $15 in increments over the next four years. The Senate parliamentarian ruled that the proposal did not meet requirements for a reconciliation bill. Expect the issue to come up in a separate bill later on. 

Arizona to receive an estimated $12 billion in aid 

An by the Arizona Joint Legislative Budget Committee (JLBC) estimates that  the state should receive about 2 percent of the stimulus package, or $12.3 billion, excluding the extended unemployment benefits.

Included is funding for projects that will help economic development across the state, including rural communities that have been hit particularly hard by the pandemic, said Carrie Kelly, executive director of the Arizona Association for Economic Development.

“There’s $690 million in transportation and $145 million in broadband and connectivity funding for Arizona that will help bridge the digital divide and create infrastructure jobs,” Kelly said. “Additionally, the $2.6 billion that Arizona local governments will receive helps those rural communities that need it most.”
To read the bill in full, visit:

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Two political strategists who have a bird’s eye view of Capitol Hill updated the Arizona business community Wednesday on the latest federal relief package and what lies ahead in 2021 for  Congress and the Biden administration. 

At the top of the list is the $1.9 trillion proposed federal stimulus package that was approved by the House on Saturday. While some moderates and conservatives are voicing concerns about the cost of a third massive Covid relief package, the Senate is expected to rush passage with a few changes, said Erik Paulsen, a former U.S. congressman who now is a consultant with , which is headquartered in Washington, D.C.  

“There are some who are a little more skeptical about whether we need to spend all of these dollars,” said Paulsen, a former Congressman from Minnesota who was a leading member on the chief tax writing House Ways and Means Committee. 

Much of the nation is seeing a resurgence in economic recovery already with added stimulus and many Americans are worried about the growing federal debt, said Paulsen, who spoke during a virtual event, the 2021 Outlook from Capitol Hill, hosted by the . 

The proposed package comes on the heels of the $2 trillion Covid relief plan passed last March during widespread shutdowns of the economy followed by the end-of-the year $900 billion package. 

Patrick Robertson, a principal of Total Spectrum who has spent almost 20 years in Washington advising clients on public policy issues also spoke at the event.

The two laid out details of the proposed relief plan and discussed other upcoming issues that are important to business. 

What’s in the proposed stimulus package

Most of the package, called the , is expected to be approved by the Senate, they said. Any changes will have to go back to the House for final approval before being sent to President Joe Biden. 

Highlights of the proposed package include:

Extended unemployment benefits Unemployment insurance benefits would be extended and increased for the third time. The bill calls for an additional $400 per week in benefits for the unemployed.  

Expanded child tax credits Child tax credits would be increased from $2,000 to $3,600 per child.

Direct stimulus payments Another round of stimulus checks would include $1,400 direct payments to adults and children. The House proposal calls for the payments to go to individuals earning up to $75,000 and couples making up to $150,000. Thus, a family of four would receive $5,600.

A host of other measures also are included: $25 billion to aid small and mid-sized restaurants still struggling from the pandemic, $15 billion for grants to businesses in low-income communities, $1.25 billion for shuttered venue operators, payments to help Americans continue to pay health care premiums, aid for local governments, and more.  

Minimum wage hike likely will not survive this legislation  

One item in the package that appears to be on the chopping block is a provision to raise the minimum wage to $15 an hour over the next four years. 

The Senate parliamentarian, a neutral arbiter of the chamber’s rules, issued guidance saying the wage increase didn’t meet the guidelines for a budget reconciliation package. Under reconciliation, bills can pass with a simple majority, rather than the 60 votes required to invoke cloture, which ends a filibuster on a bill.

Looking ahead: corporate tax rate and infrastructure 

Paulsen and Robertson also spoke about whether Congress will be able to overcome division between the two parties to finally pass a long awaited infrastructure bill, a top priority for the business community. 

President Biden has made infrastructure a priority and they said Congress could succeed this year and pass a comprehensive package to update the nation’s highways, bridges, water facilities, transportation systems, and other infrastructure. Projects for the modern age will be included — green and renewable energy, expansion of broadband as well as development tax credits and workforce investment. 

A new funding mechanism for such a plan will be needed, however, which could be a challenge considering the president has vowed not to increase taxes during the pandemic, Robertson said. 

Attempts to raise the gas tax to fund projects through the Highway Trust Fund have failed year after year. The tax is also becoming less sufficient as a funding source as electric vehicles move to the forefront of society, he said. 

“The current Highway Trust Fund doesn’t pay for itself,” Robertson said. “Now, we have Teslas and Priuses and people using different amounts of gasoline. Gasoline isn’t the only marker for how much you’re using our roads.” 

Biden has also proposed hiking the corporate tax rate from 21 to 28 percent, which would put the U.S. at a disadvantage, Paulsen said. That would spur industry and jobs to start relocating  outside of the country again.

“That would move us to the highest of all (Organization for Economic Cooperation and Development) countries in the world, so we would be uncompetitive again,” he said.  

Centrists will play important role

With narrow majorities in both houses, moderation will be needed to temper the far left and far right, both said. 

Lawmakers like Arizona’s Senator Kyrsten Sinema (D) have shown that they can place their constituents above politics. Arizona’s newest Senator, Mark Kelly (D), could follow her lead, Robertson said. 

“It appears that Senator Kyrsten Sinema does a pretty good job of listening and representing the interests of Arizona and I think Senator Kelly could learn a lot from that, advocating for Arizona instead of Democrats,” he said.

Paulsen agreed.

“Senator Kelly has mentioned he’s been spending time getting to know colleagues on both sides. If you want to be an effective legislator, you need to build relationships and he’s doing that with Republicans, which is what the country is looking for and certainly those in Arizona are looking for to make progress on the legislative front,” he said.

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