Under The Dome

This Week At the State House
 
As we approach the last few weeks of session, most of the bills mentioned in this publication will be scheduled for a vote by the committee, with a few hearings sprinkled throughout.  The House Finance Committee has not posted the budget yet, but is expected to do so at any moment.
 
Tuesday, May 28^th  
 
H.7837, An Act Relating to Labor and Labor Relations – Workers Compensation is scheduled for a vote in the House Labor Committee at 3:45.  The Senate version (S.2472) has already passed the Senate.  The bill calls for independent contractors to file annually with the Department of Labor.  A similar bill passed last year and became effective January 1, 2024.  The court reviewed the statute and determined the language required further revision to clarify the intent of the Act.  H.7837 specifies that independent contractors must file annually for each client to be legally considered an individual contractor.  The process is simple.  To file DWC-11-IC form online, go to:  https://dlt.ri.gov/workers-compensation/independent-contractors  If you are a company that hires independent contractors, the Chamber encourages you to verify the form has been filed.
 
The Senate Finance Committee will take testimony on S.2347, An Act Relating to Taxation – Tax on Gains From the Sale or Exchange of Real Property at the Rise (approximately 5:00).  The bill creates a new tax on gains realized from the sale of real property held for six years or less. 
 
                                                                        Gain as a percentage of basis (tax cost)
Years property held by transferor       0-99%             100-199%             200% or more
Less than 4 months                              60%                70%                 80%
4 – 8 months                                        35%                52.5%             70%
8 months - 1 year                                 30%                45%                 60%
1 - 2 years                                           25%                37.5%             50%
2 -  3 years                                           20%                30%                 40%
3 – 4 years                                           15%                22.5%             30%
4 – 5 years                                           10%                15%                 20%
5 – 6 years                                              5%                7.5%                10%
 
Failure to pay the proper tax or to attempt to evade the tax comes with a penalty of up to two years in prison and a fine of $10,000 or five times the amount of the tax that was owed. 
 
If you wish to submit testimony, send it to SenateFinance@rilegislature.gov  The bill can be viewed in its entirety at https://webserver.rilegislature.gov/BillText/BillText24/SenateText24/S2347.pdf 
 
 
A second bill scheduled for hearing at the Rise in Senate Finance is S.2366, An Act Relating to Public Utilities and Carries.  This bill creates a tiered rate system for electricity and natural gas customers whose household income level is below 150% of the federal poverty level and who are eligible for LIHEAP assistance or Medicaid. For these households, the plan envisions capping electric rates to ensure that they pay no more than 3% of their income on electricity or 6% of their income if the house utilizes electricity as a sole source of heat.  The program will be funded by increased rates assessed on all other customers.  The most current US Census estimates 10.8% of population in Rhode Island meets the definition of living in poverty. The census does not say how many are living at 150% of the federal poverty level.   The Rhode Island total population at the time of the census was 1,095,962.  Testimony may be submitted at SenateFinance@rilegislature.gov
 
The Senate Judiciary Committee will vote on S.3056, An Act Relating to Corporations, Associations, and Partnerships – Rhode Island Business Corporations Act.  The bill allows the Division of Taxation to share certain information with the Secretary of State’s office.  If a business fails to pay taxes to the state as required under law of the period of a year, and no settlement agreement has been entered, a notice of intent to revoke the company’s charter will be sent to the business.  If not corrected, the charter will be revoked.  This bill would take effect January 1, 2025.
 
 
Wednesday, May 29^th
 
If you are in the real estate business, are in the market to buy or sell a house, or if you are a house inspector, contact your legislator quickly.  H.7015 SubA, An Act Relating to Businesses and Professions is scheduled for a vote in the House Corporations Committee at the Rise (approximately 5:00).  The Senate version (S.2120) had a hearing in April and was held for further study, keeping it alive for possible consideration.  H.7015 bans anyone, other than a licensed electrician, from testing wires, conduits and apparatus which includes fixtures, lighting, etc. What this means, is that a potential buyer’s house inspector would no longer be able to inspect switches, lights, or look at a panel to alert the buyer to potential problems.  Buyers, should they wish to have the dwelling’s electrical system included in an inspection would need to hire a licensed electrician to perform the inspection – within the customary ten-day inspection period.  Under current law, a house inspector is permitted to look at these items and recommend the buyer seek advice from a licensed electrician if something appears amiss.  If passed into law, the bill would take effect January 30, 2025.
 
 
Thursday, May 30^th
 
The Senate Finance Committee will be taking testimony on S.2355, An Act Relating to Taxation – Personal Income Tax.  The bill imposes a Rhode Island personal income surtax of three percent (3%) on taxable income over $1,000,000, with the existing three-bracket personal income tax structure remaining in place. This surtax would be imposed on taxable income after all modifications, standard deductions, and exemptions have been applied; and would apply to tax years ending December 31, 2025 and beyond.    The additional revenue would be placed in a restricted receipt account to be used for child care, public education, roads and bridges and public transportation.  Testimony can be emailed to SenateFinance@rilegislature.gov
 
 
Action Needed Now – Contact Your State Senator and Representative
 
Even if you have spoken to you legislators months ago when the Chamber first issued a “Call for Action,” we ask you to contact your state representative and state senator again concerning H.7171/S.2121 – expansion of temporary care giver benefits.
 
H.7171 and S.2121 Acts Relating to Labor and Labor Relations – Temporary Disability Insurance

• Expand the TCI benefit to cover employees who wish to take time to care for a sibling (including half-siblings and foster siblings), a grandchild or a “care recipient.”  A “care recipient” is defined as “a person for whom the employee is responsible for providing or arranging health or safety related care, including, but not limited to, helping the person obtain diagnostic, preventive, routine, or therapeutic health treatment.”
• Increase the benefit provided to twelve (12) weeks in a benefit year beginning January 1, 2025.  This benefit was first extended to employees in 2014 at four (4) weeks.  The legislature increased it to five (5) weeks in 2022 and to six (6) weeks in 2023.  The employer is required to hold the job for the employee that is on leave.