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29

BPAA State Policy Update - June 29

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GAMING

  • Place your bets! New Jersey kicks off era of legalized sports betting: OCEANPORT, N.J. (Reuters) - With two $20 bets and a rambunctious crowd awaiting their turn, New Jersey Governor Phil Murphy placed the state’s very first legal sports bets on Thursday, capping a years-long battle to end the ban on sports betting in the Garden State.” This is a huge step forward for gaming, for the tracks, for the economy of this state,” Murphy said before placing his bets, with a crowd of media swarming him as he stepped to the counter at Monmouth Park Racetrack. Murphy’s wagers - that Germany will win the World Cup and the New Jersey Devils will take home hockey’s Stanley Cup next year - may not seem monumental. But the beginning of legal sports betting in New Jersey likely paves the way for much of the rest of the United States to eventually regulate and tax it. While sports betting is legal in many other countries, a 1992 U.S. law barred it in the United States except for a limited number of states, such as Nevada, where casinos have long included sports betting. Read more at Reuters.                                                                                                                    
  • Delaware is the first new state to bet on sports gambling, but it might not pay off: DOVER, Del. — Gov. John Carney reached into his pocket shortly before 1:30 p.m. Tuesday and pulled out a folded bill. “This $10 bill is going to bring our Phillies back,” he said. He walked over to a teller at the Dover Downs sportsbook and placed the first legal sports wager in the state of Delaware, betting on the Phillies to beat the Cubs later that night, and ushering in a new era for sports gamblers in the United States. Delaware became the first state to start accepting sports wagers since the Supreme Court overturned a federal law last month that largely outlawed sports betting outside of Nevada, and others are already racing to follow suit. “Gloating in this business doesn’t last very long,” said Carney, the state’s first-term Democratic governor. “We’re happy to be first today. … I don’t expect we’ll be the only one for very long. But today it feels pretty good to be first.” Read more at The Washington Post.                                                                                                                                                                                                                                                 
  • 660News - Speaker: Sports gambling unlikely to pass in NY this year: ALBANY, N.Y. – The speaker of the New York state Assembly says there isn’t enough support to pass legislation authorizing sports wagering this year. Bronx Democrat Carl Heastie said Thursday that lawmakers in his chamber have raised “significant issues” about legislation that would allow bets at casinos and on mobile devices. While supporters will keep trying to find a compromise, Heastie’s comments all but end any chance of a sports betting bill passing before lawmakers adjourn for the year next week. Betting has already started in New Jersey after that state passed a law authorizing sports betting. Many states are expected to follow after the U.S. Supreme Court ruled that it’s up to all 50 states to decide whether to allow the gambling activity.                                                                                                                                                                                                                               

 TAX                                                                                                                                                                                                                                                               

  • Overview: With many state fiscal years ending June 30th, budget negotiations were completed recently in California, Illinois, Michigan, and North Carolina. New Jersey remains a state to watch as a government shutdown looms but leaders continue to disagree about a proposed millionaires tax, corporate taxes, and school funding. In other states looking to wealthy individuals and large corporations for needed revenues, Arizona's teacher pay crisis could be solved with a tax on its highest-income residents and a similar proposal in Massachusetts is polling well, but Seattle's new "head tax" could be on the chopping block.                                                                                                                                                                                                                                                                                                          
  • Seattle Tax Repealed: The Seattle City Council on Tuesday voted to repeal a tax hike on large employers that it instituted less than a month ago, backing down from a plan fiercely opposed by Amazon.com and much of the city's business community. With Amazon and Starbucks funding a ballot challenge to repeal the tax, the city's Democratic council struck down the tax levy they approved about four weeks ago. Seattle Mayor Jenny A. Durkan (D) is expected to approve the repeal. The new tax would have raised $48 million annually to combat Seattle's homelessness and affordable housing crises. The Seattle area has the third-largest homeless population in the country, according to federal statistics. “It's immensely disappointing,” said Seattle City Council member Mike O'Brien (D), who voted for the tax before voting for its repeal. "[But] it has become more and more clear that the people of Seattle seem to agree with Amazon — and at least part of the narrative they and the Chamber of Commerce have been putting out." The abrupt reversal enraged some supporters of the "head" tax, who argued that wealthy corporations in the city can afford to pay more to address homelessness. The measure, passed unanimously by the city council last month, levied a $275-per-employee tax on companies with at least $20 million in gross annual revenue.                                                                                                                                            
  • California: Revised Tax Deduction Cap Workaround on Deck in California: A newly revised California bill to allow taxpayers to make charitable contributions to get around the new $10,000 federal cap on state and local tax deductions is one of several to watch as lawmakers start the second half of the 2018 session. S.B. 227 by Sen. Kevin de Leon (D) was amended June 4 to shift a proposed charitable contribution mechanism from the state to the counties. The changes put more distance between the government that gives the tax credit and the entity receiving the benefit, which could strengthen it in the eyes of the Internal Revenue Service, Darien Shanske, law professor at the University of California, Davis School of Law, told Bloomberg Tax June 5. It is one of two bills that would help California taxpayers get around the cap on federal deductions for SALT payments through charitable contributions and credits at the state level. S.B. 227 passed the Senate in January and is awaiting consideration in the Assembly. A.B. 2217 passed the Assembly in May and can be considered in the Senate. They both must pass the second house by Aug. 31 to reach the desk of Gov. Jerry Brown (D). Each bill can be enacted without conflicting with the other, Shanske said. De Leon couldn't be reached for comment June 5.                                                                                                                                                                                                                        
  • New Missouri Governor Signals Support for Tax Cuts Newly installed Missouri Gov. Mike Parson (R) has signaled support for the state Legislature’s tax cutting agenda, urging lawmakers to help the state move beyond the recent turmoil surrounding his predecessor, Eric Greitens (R). In his first address as governor to the Legislature, Parson was short on policy specifics, but he did praise the Republican-dominated Legislature’s work in the recent session that could stand as a shorthand statement of his policy inclinations. “Your many legislative achievements include significant tax reform for Missourians, record education funding for our students, government union reform, a responsible, balanced budget, and many other reforms that made government smaller, more efficient, and more effective for Missourians,” he said June 11. Parson, who was elected lieutenant governor in 2016, succeeded Greitens as governor June 1 after Greitens’ resignation following scandals related to an extramarital affair and possible campaign finance violations.                                                                                                                                    
  • North Carolina Lawmakers Override Budget Veto, Retaining Tax Cuts North Carolina lawmakers have enacted a budget that includes tax cuts set for 2019, overriding the veto of Gov. Roy Cooper (D). The $23.9 billion appropriations measure for the fiscal year that begins July 1 (S.B. 99) maintains corporate and personal income tax rate reductions that the governor sought to block. The measure also includes certain language conforming the state with some recent federal tax code changes. Budget legislation enacted last year lowers the current 3 percent corporate tax rate to 2.5 percent in 2019 and drops the personal income tax rate from 5.499 percent to 5.25 percent next year.                                                                                                                                                                                                        
  • Minnesota Conformity Law Must Wait Until 2019 Chances for a special legislative session to deal with Minnesota’s failure to conform to changes in the federal tax code remain slim, ensuring a complicated and confusing 2018 tax year, political insiders and practitioners told Bloomberg Tax. While some observers initially speculated that Dayton would call a special session to address the tax code, the governor remains opposed to any extraordinary legislative maneuvers. As a result, Michael said taxpayers will be forced to “deal with tax year 2018 as a nonconformity year.” Minnesota is a static conformity state with features of the corporate franchise tax and personal income tax codes tied to the IRC as of Dec. 16, 2016.                                                                                                                                                                                                                                                       

MINIMUM WAGE                                                                                                                                                                                                                                          

  • Maryland Minimum Wage: Effective July 1, 2018, the hourly minimum wage in Maryland is to rise to $10.10 from $9.25, and the hourly minimum wage in Montgomery County is to rise from $11.50 to $12.25 for employers with 51 or more employees and to $12 for employers with 50 or fewer employees. A measure (28-17) signed Nov. 13, 2017, by Montgomery County Executive Isiah Leggett (D) extended the deadline by which a $15 minimum wage must be adopted to July 1, 2022, for large employers and to July 1, 2024, for small employers, which the measure defined as employers with up to 50 employees. Previously, small employers were defined as those having up to 25 employees. Effective July 1, 2018, the maximum tip credit for Maryland’s tipped employees who monthly earn more than $30 in tips is to increase to $6.47 from $5.62 based on a required cash wage of $3.63. The required cash wage that must be paid by Montgomery County employers to tipped employees is to be at least $4 an hour, an amount that when combined with tips must equal at least the Montgomery County minimum wage rate of $12.25 or $12, depending on employer size.                                                                                                                                                                                                                 
  • Illinois Local Minimum Wage, Sick Leave
    • Chicago: Effective July 1, Chicago’s hourly minimum wage is to rise to $12 from $11 under a 2014 ordinance that is to raise the minimum wage for Chicago workers to $13 by 2019. As of July 1, the hourly minimum cash wage for tipped employees is to rise to $6.25 from $6.10, according to the city’s website. Minimum wage posters are available for download from the city’s website.
    • Cook County: Effective July 1, the Cook County hourly minimum wage is to rise to $11 from $10, and the hourly minimum cash wage for tipped employees is to rise to $5.10 from $4.95, according to the county’s website.
    • Western Springs: Effective May 18, the Western Springs hourly minimum wage rose to $10, and full-time workers gained the ability to annually earn up to five paid sick days under an ordinance (No. 18-2918) that was approved May 7, according to the village’s website.
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