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Govt. Affairs

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Yesterday, a Texas federal judge issued a temporary injunction to the Department of Labor’s (DOL) overtime rule. In granting the preliminary injunction, the federal judge said the DOL’s overtime rule exceeds the authority the agency was granted by Congress.

As you may recall, the DOL’s overtime rule was announced in May, and it has been opposed by many businesses and nonprofits. The rule was to take effect on December 1 of this year. Now with yesterday’s ruling, it is likely that President-elect Trump’s administration, which opposed the rule, will have time to review it and make changes and/or roll back various provisions contained in the current rule.

The DOL could appeal the Tuesday ruling, but with the Obama administration only having approximately two months in office, an appeal is unlikely. With many RCPA members already implementing and announcing changes to comply with the DOL’s overtime rule, it might be difficult for those members to roll back these changes, because it may impact employee morale. As further information is released, RCPA will provide additional guidance to members. Please contact Jack Phillips, RCPA Director of Government Affairs with any questions.

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Yesterday, the General Assembly passed and the governor signed the remaining bills to enact the current fiscal year’s spending plan of $31.5 billion. To pay for the general appropriations bill, the Legislature adopted several tax increases and some new revenue streams. The cigarette tax was increased another $1/pack while e-cigarettes, roll-your-own cigarettes, and smokeless tobacco have now been added as taxable items.

Additionally, lottery winnings will now be assessed a PIT and a sales tax will be imposed on digital downloading of books, music, satellite radio, and streaming audio/video. The tax on table games was also increased by 2%, but will sunset in five years. Revenue streams for the fiscal year are also dependent upon several non-recurring sources; i.e., a number of transfers contained in the fiscal code such as transfers from:

  • The tobacco settlement – $28.5 million;
  • Recycling fund – $9 million;
  • The Building Pennsylvania program – $12 million;
  • The Volunteer Companies Loan Fund – $9 million;
  • The Alternative Fuels Incentive Fund – $5 million; and
  • Several gaming licensure fees.

Please contact Jack Phillips with any questions.

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Early yesterday evening, the Pennsylvania House of Representatives approved the changes made in the Senate by a 144-54 vote and sent SB 1073, the general appropriations (GA) bill, to the governor. The approved GA bill increases spending by $1.5 billion, or an increase of 5%. Even though the General assembly sent the GA bill to the Governor, the House and Senate still must come up with the revenues necessary to pay for the appropriations as set forth in the bill.

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The Pennsylvania House of Representatives is poised to send SB1073, the General Appropriations spending bill, to the Senate today. The new budget bill authorizes important spending for all state programs – although SB1073 authorizes $31.55 billion in spending, the House will send the bill to the Senate without the requisite revenue to produce a balanced budget.

Highlights of the new budget plan includes:

  • $200 million of additional funding for basic education;
  • $30 million more for early childhood education;
  • $20 million more for special education;
  • $10 million more for early intervention services;
  • Flat funding for Penn State, the University of Pittsburgh, Temple University, and Lincoln University;
  • $15 million for the opioid crisis;
  • $5 million for “emergency addiction treatment through DDAP”;
  • $10 million for “behavioral health services” through DHS;
  • $80.4 million more is appropriated to reduce the waiting list; and
  • $31.2 million in additional funds devoted to services to persons with a disability.

According to Appropriations Chair Bill Adolph (R – Delaware), the proposed spending would be paid for by a mix of revenue sources: increased and new taxes on smoking related products ($480 million), additional revenue from the gaming expansion bill that still awaits a final vote in the House ($267 million), tax amnesty revenue ($129 million), the funds already projected from the recently enacted liquor bill, and $50 million from a license fee for a Philadelphia casino.

For members’ convenience, please see the summary of the House Republican budget proposal created by RCPA. Contact Jack Phillips with any questions.

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*RCPA MEMBER EXCLUSIVE*

RCPA will be hosting a webinar exclusively for members, entitled: Changes to the FLSA’s Overtime Rules on Friday, June 3, 2016, at 10:00 am. This webinar will specifically cover the Department of Labor (DOL) Proposed Rule regarding changes to overtime exemption and salary thresholds.

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