What’s New
A Better Delaware is a non-partisan public policy and political advocacy organization that supports pro-growth, pro-jobs policies and greater transparency and accountability in state government.
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What’s New

Christiana Care Health System, state’s largest private employer, to offer paid parental leave?

From the News Journal

Christiana Care Health System delivered good news to its employees Wednesday: It will start offering paid parental leave to employees — a benefit the state’s largest private employer has not previously offered.

Beginning July 2020, the health system will offer at least 12 weeks of paid parental leave to its 12,000 employees. The leave will only apply to employees who are parents for the birth, adoption or fostering of their child.

“We know that the bond formed between mother and child in the first few weeks of life can have a tremendous impact on the health of the baby and the well-being of the family,” Dr. Janice Nevin, the health system’s CEO, said in press release.

Nevin said in an email to employees that the issue became a focus for the administration last year after a survey about benefits.

Christiana’s move followed the Delaware General Assembly last year passing legislation to grant state employees 12 weeks of paid family leave. The state government is the largest employer in Delaware.

 

Read more:

https://www.delawareonline.com/story/news/health/2019/09/18/christiana-care-health-system-offer-paid-parental-leave/2363998001/

Delaware jobless rate up a tenth of a percent as signs of a mild slowdown appear

From Delaware Business Now

Delaware’s seasonally adjusted unemployment rate in August 2019 was 3.4 percent, up from 3.3 percent in July.

The Delaware Department of Labor says the state is seeing a mild slowdown, but nothing akin to the deep recession of 2008 and 2009. A bright spot is teen employment, with a much lower jobless rate for female teen workers.

The state reported 16,600 unemployed Delawareans in August 2019 compared to 17,700 in August 2018.

The US unemployment rate was 3.7 percent in August 2019, unchanged from July. In August 2018 the US unemployment rate was 3.8 percent, while Delaware’s rate was 3.7 percent.

In August 2019, seasonally adjusted nonfarm employment was 466,000, up from 464,500 in July 2019.

Since August 2018, Delaware’s total nonfarm jobs have increased by 5,600, a rise of 1.2 percent. Nationally, jobs during that period increased by 1.4 percent

In its monthly commentary, the Labor Department noted that in August, The number of unemployed residents rose above 16,000 for the first time since March, to 16,600, while the number of residents with jobs fell for the first time this year (last month’s tiny decrease was revised to a tiny increase).

 

Read more:

https://delawarebusinessnow.com/2019/09/delaware-jobless-rate-up-a-tenth-of-a-percent-as-signs-of-a-mild-slowdown-appear/

Certificate-of-Need Laws and Delaware Health Services

Why does Delaware still allow a virtual monopoly in health care that drives up everyone medical bills?

Delaware has certificate-of-need (CON) laws, which require that health care providers show a need in the community for new devices, certain technologies, or expand or establish a practice.

Instead, research finds that CON laws are associated with higher health care spending per capita and higher physician spending per capita. In Delaware, CON laws create a barrier to entry into the market, inhibit expansion, and fail to provide adequate health care services in some areas.

Delaware has seen these consequences of CON laws in health care. The First State has the highest average monthly insurance premium and one of the lowest percentages of medical residents retained.

Additionally, Delaware spends more per-capita on healthcare than every nearby state excluding New York, and ranks 7thoverall for state health spending. For health care spending for patients over 65, Delaware ranks 5thhighest, 6thhighest for state government spending.

This isn’t the only negative impact these laws have had on our state. The presence of a CON program tends to be associated with fewer rural hospitals. We recently saw a battle in Sussex County regarding an expansion of services, since currently only three hospitals service 1,196 square miles of the rural county. The request to expand was denied.

Proponents of CON laws argue that they help to reduce health care costs and increase access. Contrary to typical supply and demand, they also argue that a shorter supply of health care services in the market results in a reduction of average prices.

A report by the Mercatus Center estimates a savings of $270 on total healthcare per capita without CON law, and an increase in access to hospitals and ambulatory surgical centers. They also estimate an increase in local services without these restrictions, helping residents access healthcare and keeping spending local.

Delaware has utilized the CON process since 1978. Forty-one years later, we may need to re-evaluate and better serve our residents.

Could Delaware’s “Keystone Growth Industry” Also be Hurting the State Economy?

Healthcare typically is a necessity, not a want, and therefore remains a constant driver of our state and national economy.

While Delaware’s businesses earnings increased 8.4% from 2006-2016, health care earnings surged by 64.2% in the same period. Delaware’s health care industry earnings for 2016 were $4.3 billion—almost equivalent to Governor Carney’s 2020 budget.

The numbers look promising, but a staggering 95% of those earnings are from government provided health care insurance, making Medicare and Medicaid the top players. Medicaid, both a federal and state program to assist with medical costs and cover lapses in Medicare, is the single largest line item in the state budget.

Instead of being an economic driver, this turns health care into a major concern for future state spending. If this market continues to boom, so will the costs that Delaware burdens from it. The potential for another budget shortfall becomes immense and many routes to combat this are a detriment to Delaware businesses and families, such as increased taxes and fees or cuts in other critical areas.

Over the past decade, Medicaid spending in Delaware rose at twice the rate of the General Fund revenue. Eventually this bubble will burst, and the same people who sank us will be tasked with raising us up once again.

We can hope that they do better this time, or the next, but insanity is repeating the same thing, or electing the same people, and expecting different results each time.

Good Intent Doesn’t Guarantee Good Outcomes

Companies in Delaware may soon reach a breaking point. Recent legislation from Dover has made the First State less favorable for business, through various taxes, regulations, and other “bad business” bills.

These actions have been in the pursuit of a better standard of living for Delawareans, but could they be the ones at risk?

Delaware’s franchise tax, corporation income tax, and taxes on limited liability companies, limited partnerships, and general partnerships can add up to a big problem for businesses, who may owe more than one of these to the state. Add in a minimum wage increase and bottom lines come into question.

Unfortunately, the answer to this has been to replace workers with robots. McDonald’s has order stations, grocery stores feature self-checkouts, and a few Walmart stores in Delaware have brought in autonomous floor cleaners, or “Auto-C’s.” Technology has begun to replace what has become an expensive workforce.

Businesses are not in the wrong to take these actions—in fact, they are doing what is best for business, and therefore best for the employees they are able to retain, as well as the communities they serve. However, it does result in minimum and low-wage workers facing layoffs as companies seek to protect their own operations against the assault from our legislators.

At the end of the day, the decisions from Dover have hurt the people they were intended to help.

Ben duPont, Chris Kenny launch ‘non-partisan’ advocacy group

From The Delaware Business Times

Chris Kenny, president and CEO of The Kenny Family ShopRites of Delaware, and Ben duPont, philanthropist and entrepreneur, today announced the formation of A Better Delaware, a “non-partisan grassroots organization” that will advocate for pro-growth, pro-jobs policies and greater transparency in government.

“I speak with employers and workers every day who share my concern about Delaware’s business climate and our competitiveness with other states,” said Kenny, who operates six ShopRite stores in the state.

Zoe Callaway, a recent graduate of the University of Delaware, will serve as executive director. She told Delaware Business Times that the advocacy group will focus on fighting regulations and high-tax policies, including new income tax brackets and the real estate transfer tax.

 

Read more:

https://www.delawarebusinesstimes.com/local-leaders-launch-advocacy-group/

Business Haven or Business Has Been?

Delaware has long maintained a reputation as a business haven but that may soon change.

A new study from WalletHub ranked Delaware as the 7th worst state to start a business and in the bottom ten for business climate. This is nothing new.

According to the Federal Reserve Bank of Philadelphia, Delaware’s business conditions recovered from the Great Recession at a noticeably slower pace than the rest of the nation, taking three more years to stabilize than the average. During that recovery period, the state’s real GDP (the change in real GDP from 2009 to 2013) was approximately -2%, while the national average was closer to +8%.

Delaware’s recovery still leaves something to be desired by many. At a Delaware Business Roundtable (DBT) panel in June, former Delaware Economic Director Alan Levin expressed his concern, stating, “I want to get to the point where…people are knocking on our door saying, ‘I want to come to Delaware because we see things are happening here.’ That’s not really happening…Until legislators and the administrators… realize that their most important thing is to serve the people as opposed to getting re-elected…things are not going to change.”

It is time to create this change. At this point, we stand at a critical juncture for our economy. It is time to make decisions with the future in mind instead of putting elections above Delawareans.

As we prepare for the second half of the 150thGeneral Assembly, it is time to demand better practices and legislation in Dover that promote a better business climate and strengthen our economy, such as Governor Carney’s “Rainy Day Fund” included in the FY 2019 and FY 2020 budget appropriations.

Delaware has the industries, bond ratings, and location needed to be business-friendly again and have a robust economy, if legislation from Dover allows it.

The First State can be a leader in business again if we take the right steps forward.

 

Delaware launches new ‘One Stop’ business registration site

From Delaware State News

DOVER — After about three years of collaborative multi-agency work and an approximately $1 million investment, the state launched Delaware One Stop — a website that pulls all the business registration, licensing and other obligations and resources into one place for companies looking to open their doors in the state.

Dana Rohrbough, the director of Government Information Center, says they’re still making tweaks to the site, which is in a soft-launch phase that started mid-August, as they receive user feedback. Ms. Rohrbough says the site is technically a full revamp and relaunch of an earlier “one-stop” resource from 2005.

Read more:

https://delawarestatenews.net/business/delaware-launches-new-one-stop-business-registration-site/

Robots show up in Delaware’s Walmarts

From Delaware State News

MILFORD — Over the past month, Delaware Walmart shoppers may have caught a rather surprising glimpse of a floor scrubbing machine driving itself up and down the aisles.

In July, the Camden, Milford and Middletown Walmart stores all got autonomous floor cleaners, or “Auto-C,” as they are known.

According to Walmart spokesman Ragan Dickens, these are just the most recent robots the retail giant has introduced in its stores in the state. Walmart began testing several types of robots in their stores across the country in 2018.

Read more:

https://delawarestatenews.net/business/robots-show-up-in-delawares-walmarts/

A proposed tax, just for one nonprofit: Behind the DE Turf bill

From Delaware Online

A new hotel tax in Kent County, if it gets final approval, would benefit the DE Turf athletic complex. Reporters Karl Baker and Sarah Gamard looked into this story with a series of articles.

Connections don’t mean conflict of interest, brothers say

Pushed by Dover Sen. Trey Paradee, the tax law that could inject nearly $1 million a year into DE Turf in Frederica has a notable beneficiary – a private development championed by Paradee’s brother. They both strongly object to any idea that this was intentional.

Read more:

https://www.delawareonline.com/story/news/local/2019/08/22/behind-de-turf-bill-new-tax-just-one-nonprofit/2060073001/