MINNESOTA and NORTH CAROLINA may be in a recession, according to research indicating that when a state’s unemployment rate rises by at least 0.4 percentage points above its lowest rate in the preceding 12 months, there’s a 50 percent chance the state is in a recession. North Carolina’s unemployment rate was 4.2 percent in July, up from a low of 3.7 percent in December, while Minnesota’s rate was 3.4 percent, up from 2.8 percent in October. (STATELINE.ORG)
CALIFORNIA took in $74 million in cannabis excise taxes in the second quarter of this year, about $7 million more than it collected from January to March. But illicit sales and other problems have kept revenues from legal pot sales far below the $1 billion per year government analysts initially projected. (ASSOCIATED PRESS)
A ruling last year by the MINNESOTA Supreme Court that the state can’t tax trusts set up by Minnesota residents in other states to avoid paying state income tax could cost the Gopher State more than $100 million per year for the next couple of years. The state’s Department of Revenue estimates it will now take in $33.4 million less in trust-related taxes each year and potentially pay out $66.8 million in refunds in the next couple of years for taxes that have already been paid. (MINNESOTA PUBLIC RADIO)
NEBRASKA took in a record $5.9 million in state lodging taxes from July 2018 through June 30, 2019, 4 percent more than the state collected the previous fiscal year. John Ricks, executive director of the Nebraska Tourism Commission, attributed the increase in part to the state’s unconventional new tourism slogan: “Nebraska. Honestly, it’s not for everyone.” (OMAHA WORLD-HERALD)
WISCONSIN had the most family-farm bankruptcies in the nation in the 12 months from July 2018 to June 2019, with 45 Chapter 11 filings. Although that’s five fewer than in the previous 12-month period, farm bankruptcies were up in KANSAS and MINNESOTA between July 2018 and June 2019, by 11 and 13, respectively, bringing their totals to 31 and 39. (MILWAUKEE JOURNAL SENTINEL)
-- Compiled by KOREY CLARK
It’s been 10 months since Hurricane Michael slammed Florida’s Panhandle in October 2018. But more than 20,000 insurance claims from residential property owners - about 14 percent of the total number filed - remain open.
That rate is high compared to Hurricane Irma in 2017. Nine months after that storm, 9 percent of claims were still open. While Irma, a category 5 hurricane when it made landfall in the Florida Keys, impacted more properties, it generally caused less damage to them than Michael, a category 5 hurricane at landfall.
Still, Florida law requires residential property insurers to pay their claims within 90 days. And during storm season they used to report regularly to the state’s Office of Insurance Regulation how many claims were settled within that time frame.
But the department has shifted away from that practice, saying the number of open claims is “commonly misunderstood due to the fact that it is nuanced.”
The 90-day clock doesn’t actually start ticking when a claim is filed but only after the insurer has determined how much is owed and the homeowner has agreed to that sum. Chip Merlin, a property insurance claim attorney based in Tampa, said that allows insurers to take their time consulting with experts and performing inspections before providing homeowners an estimate.
“By the time a decision and an estimate for the amount of damages is made, it is literally six months after the hurricane,” he said.
The start of the 90-day timer can be delayed even longer if a homeowner disputes the insurer’s estimate.
State officials say those considerations diminish the value of knowing how many claims are over 90 days old. But Merlin says that information indicates how fast insurers are getting money to their customers.
“People need the money right away,” he said. “There shouldn’t be these inherent delays in paper-pushing.” (TAMPA BAY TIMES)
During the final week of this year’s legislative session in Arizona, state lawmakers passed a bill (HB 2756) that, among other things, will require the state to calculate the additional state cost of any minimum wage increase above the state rate by a city or county, potentially resulting in the local government having to pay that added expense.
The legislation comes three years after voters in Flagstaff approved Proposition 414, incrementally raising the city’s minimum wage from the then-$8.05 state rate to $15 by 2021, and one year after the city’s voters rejected Prop. 418, which would have rolled back the 2016 minimum wage increase. And both of those initiative votes came despite the passage of a statewide ballot measure in 2016 (Prop. 206) increasing the state minimum wage rate to $12 by 2020.
Supporters of HB 2756 say the legislation is needed in case the state has to pay more for services in Flagstaff as a result of the city’s higher minimum wage.
“We don’t feel the taxpayers around the state should be forced to bear the burden of the additional cost,” said House Appropriations Committee Chairwoman Regina Cobb (R).
But others say HB 2756 was intended to discourage other local governments from raising their minimum wage rates above the state rate.
“The message is: Other cities, you do this at your own peril,” said Rep. Randall Friese (D), who opposed the measure when it came up for a vote in the Appropriations Committee.
It won’t be known whether Flagstaff’s minimum wage increase is actually going to cost the state more money until next month at the earliest. And if the state does incur additional expense, it will be up to the next Legislature to determine whether to hold the city accountable for it. (ARIZONA REPUBLIC [PHOENIX])
Lawmakers in at least three states have introduced legislation this year that would impose a tax on corporations that pay their chief executive officers far more than their average workers, according to Inequality.org, a project of the Washington, D.C.-based Institute for Policy Studies. Four states failed to pass high-CEO-to-worker-pay-ratio tax measures in 2017, after Portland, Oregon became the first city to adopt such a tax in 2016. San Francisco’s City Council has also approved a motion to place a CEO-pay tax measure on the city’s March 2020 ballot.
It’s a good time to be a CEO in America.
Various studies show that CEOs of major corporations made hundreds of times what their workers earned in average pay last year. According to data compiled by the Associated Press, average CEO compensation at Fortune 500 companies rose to $12 million, roughly $800,000 more than in 2017.
That’s impressive, but $12 million would still be a pay cut for executives like Nike CEO Mark Parker, who hauled in just a tick under $14 million in compensation in 2018, 550 times the amount of the Swoosh’s $25,386 median salary. And it would be downright miniscule for Disney CEO Bob Iger, who raked in almost $66 million last year, a whopping 1,424 times the $46,127 median salary for a Disney worker. Much of Iger’s 2018 compensation was in long-term incentives associated with his new contract. His 2019 compensation is expected to be a relatively piddling $35 million.
Escalating CEO pay has for decades prompted calls for Congress to somehow limit executive compensation, with not a whole lot to show for it. But focus on the issue picked up steam in 2010 with the Dodd-Frank Wall Street Reform and Consumer Protection Act, which imposed greater regulation and transparency requirements on banks and other financial institutions. The Securities and Exchange Commission codified a final rule in 2015 that requires publicly-traded companies to disclose the ratio between CEO pay and the median salary of their workers.
With that disclosure has come a growing awareness of the sometimes-massive gap between CEO salaries and those of their employees. And as the rich get richer, a handful of bills aimed at curbing CEO pay are currently pending in both the U.S. House and Senate, including measures authored or co-authored by two Democratic presidential candidates, Sen. Elizabeth Warren of Massachusetts and Rep. Tulsi Gabbard of Hawaii.
The battle has also increasingly moved outside of D.C., where some states and local governments are now looking to address skyrocketing CEO compensation by hitting companies where they would likely feel it the most – in their bank accounts.
In 2016, Portland became the first city in America to endorse a tax on publicly-traded companies where CEO compensation is 100 times that of the median wage for the rest of the firm’s workers. That levy – a 10 percent hit if the ratio is 100/1, 25 percent if it is 250/1 or more – is forecast to bring up to $3.5 million of additional annual revenue into the city’s General Fund, with an emphasis on funding services for the city’s homeless population.
The city’s revenue director recently noted that at least 153 companies paid the tax this year, with an average bill of $15,800. The levies are imposed on top of the city’s current local profits tax, with the worker’s end of the ratio based on the median pay for all of a company’s employees wherever they might be in the world.
That last bit is an important distinction between what Portland is doing and the other large metropolitan area most likely to follow suit.
A ballot measure set to go before voters in San Francisco next March would impose an additional tax on a company’s gross receipts, ranging from 0.1 percent on corporations with a 100/1 CEO/worker pay ratio to 0.6 percent for companies where the ratio is 600 or more to one. But the San Francisco ratio is calculated only against the pay of workers in the city itself. Even so, the city controller’s office has estimated the tax could bring in anywhere from $60 million to $140 million annually, with the funds targeted for city mental health services.
A handful of bills have also been introduced in the states over the last two years, including measures in Massachusetts, Illinois, Minnesota, Washington, Rhode Island, Connecticut and California. A few are pending and won’t be taken up until next year, but most have failed.
Two measures are alive in Washington, both authored by Rep. Beth Doglio (D). One, HB 1681, would impose a surcharge equal to 10 percent of a company’s business and occupation (B&O) tax payments if its CEO’s pay is at least 50 times greater than its median employee wage. Under a second bill, HB 1778, the surcharge would increase to 25 percent if the executive pay ratio is equal to or greater than 150 to 1. Companies required to report their pay ratio to the SEC that don’t also send that information to the state would be hit with an automatic 25 percent surcharge.
Both measures are currently pending in the House Committee on Finance and are likely to be heard next session.
The Massachusetts bill, SB 1702, would hit companies that exceed the 100/1 ratio with an additional 2 percent tax on their net income. That measure, authored by Sen. Jason Lewis (D), is currently awaiting a hearing in the Joint Committee on Finance.
The California measure - SB 37, authored by Sen. Nancy Skinner, a Bay Area Democrat - would raise the annual state income tax on the top 0.2 percent of companies that do business in California from 8.84 percent to 10.84 percent. The rate would climb progressively higher for companies with CEO/worker pay ratios of higher than 100/1. The highest rate, 14.854 percent, would be imposed on companies where the ratio is 300/1 or higher.
That bill has been lodged in the Senate Rules Committee since April. It has until Jan. 31, 2020 to be heard, but some observers believe the bill will instead end up being forged into a ballot measure for 2020. If so, it could be paired with an already-qualified measure to overhaul the state’s longstanding property tax law (Prop 13), sure to be one of the most hard fought ballot measure battles in the nation.
With all of those measures seemingly in flux, advocates for taxing companies with large CEO/worker pay disparities have turned their attention to local efforts like those in Portland and San Francisco. Sarah Anderson, who directs the Global Economy Project at the Institute for Policy Studies, believes the San Francisco measure could convince other municipalities to pursue similar measures.
“I think it will have a huge impact,” Anderson says. “It will get a lot more attention as a ballot measure than it would have as just a straight vote by the Board of Supervisors.”
That’s key, she says, for gaining traction on an issue that is often too wonky for many people to keep up with.
“The number one reason I think this hasn’t caught on like wildfire in the way I thought it would a few years ago, is that people just didn’t know about this idea,” she says. “There are still mainstream journalists at big-time publications that aren’t even aware that companies have to publicly share this information.”
And now that Portland is deriving real revenue from its tax, she believes support is likely to grow at the grassroots level in many other locales.
“I talk to so many people now who, when they hear about tying taxation to the pay ratio, think it’s a great idea,” she says.
But as with most complex issues, the devil may truly be in the details.
University of California Berkeley Economics professor Benjamin Hermalin is far less bullish than Anderson on whether any such taxation plan will actually motivate companies to cut CEO salaries or foster greater wage equity. He thinks many companies will simply find ways around the law, such as moving operations outside of a city like San Francisco. Others might just choose to pay the tax as a cost of doing business, which produces revenue but does nothing to address the actual disparity problem. It could also lead to more efforts at the state level to bar local governments from implementing those taxes.
But more than anything, he says, if the goal is to lessen economic inequality, the approach is more punitive than practical in terms or positively impacting the widest number of people.
“Even if you heavily regulate a handful of CEOs, it’s only a fraction of the income inequality issue,” he says. “You would be much better off to change the tax code overall with a much more progressive income tax.”
There isn’t anything in this universe that someone somewhere won’t try to package and sell. Case in point comes from California, where a company is leveraging the DMV’s notorious appointment backlog by offering expedited appointments...for a fee. Yep, as CalMatters reports, for $24.99 you can have someone go online and scour all the DMV sites in your area and grab one that fits your schedule. Which is pretty amazing given that the DMV doesn’t charge for setting up said appointments. So essentially charging people for being too lazy to do it themselves. Alas, it also pretty much allows people with money to cut in front of folks without, which some folks think is pretty lame. And some of those folks are lawmakers, who have unanimously endorsed a bill that would ban the practice.
-- By RICH EHISEN
A former North Dakota gubernatorial candidate has had it with the secrecy of his fellow lawmakers. Had, had, had it! Now, Rep. Marvin Nelson is going to do something about it. as the Bismarck Tribune reports, Nelson said he will livestream legislative committee meetings as a way to “shame” his colleagues into being more transparent with voters about what goes on behind closed doors. Not surprisingly, the idea has drawn a lukewarm reception – at best – from legislative leaders like House Majority Leader Chet Pollert, who groused it would “politicize” legislative meetings. Because who would possibly think that politics would be involved in political activities. Or for that matter, that shame would be.
The biggest question awaiting an answer in the annual rush to the end of the California legislative year doesn’t actually involve legislation. As the Capitol Morning Report notes, the race between Sen. Scott Wilk and Assemblymember Tom Lackey to be the first one to lose 20 pounds is down to the wire. With about two weeks left in their duel, Lackey had dropped 17 pounds, while Wilk was down 16.5. Wilk had apparently dropped a bit more, but his communications director Eileen Ricker notes he had a bit of a setback. Or more directly, “The Antelope Valley Fair will get you every time.”
The SEATTLE City Council unanimously approves an ordinance requiring the city Department of Transportation to build protected bike lanes any time those lanes are included in the city’s long-term bike plans and a paving project is worth more than $1 million (SEATTLE TIMES).
The SAN FRANCISCO Board of Supervisors unanimously endorses a resolution declaring the National Rifle Association to be a domestic terrorist group. The resolution further declares the city’s intention to assess its financial and contractual relationships with vendors that do business with the NRA (WASHINGTON POST).
-- Compiled by RICH EHISEN
CALIFORNIA Gov. Gavin Newsom (D) signs SB 245, which allows military veterans to have adoption fees waived for dogs and cats available at animal shelters (LEXISNEXIS STATE NET).
Also in CALIFORNIA, Gov. Newsom signs SB 192, striking down a law that makes it a crime to refuse a police officer’s request for help in making an arrest (SACRAMENTO BEE).
NEW YORK Gov. Andrew Cuomo (D) signs AB 1213, which allows Empire State officials to access and consider out-of-state mental health records for people applying for a gun permit (NEW YORK GOVERNOR’S OFFICE).
The CALIFORNIA Senate gives final approval to SB 276, which would allow the state Department of Public Health to review and potentially reject medical vaccine exemptions written by doctors who have granted five or more in a year. The measure heads to Gov. Gavin Newsom (D) for consideration (LEXISNEXIS STATE NET).
NEW HAMPSHIRE Gov. Chris Sununu (R) signs a pair of bills designed to help prevent cancer in firefighters: SB 257, legislation that mandates the removal of per- and polyfluoroalkyl substances, known as PFAS, from firefighting foam; and SB 193, which prohibits the use of flame retardant chemicals in furniture.
The CALIFORNIA Senate Appropriations Committee declines to endorse AB 572, a bill that would have barred the state from doing business with companies whose products contributed to deforestation (CALMATTERS [SACRAMENTO]).
Also in CALIFORNIA, the Senate Appropriations Committee tables AB 719, a bill that would have delayed until 2025 implementation of a law that bans the importation of products made from alligators or crocodiles (CALMATTERS {SACRAMENTO]).
Staying in CALIFORNIA, the Assembly Appropriations Committee kills SB 166, which would have required state water officials to develop guidelines for wineries and breweries to recycle the water used in their production process (CALMATTERS [SACRAMENTO]).
CALIFORNIA Gov. Gavin Newsom (D) signs AB 273, which makes the Golden State the first to ban commercial fur trapping statewide (LEXISNEXIS STATE NET).
The CALIFORNIA Senate Appropriations Committee holds AB 376, a bill that would have established a student loan borrower’s bill of rights, hired a state borrower advocate to respond to consumer complaints, and monitored loan servicers’ performance. The measure is now dead for the year (CALMATTERS [SACRAMENTO]).
Also in CALIFORNIA, Gov. Gavin Newsom (D) signs SB 711, which requires public schools to update the records for transgender and nonbinary students so that they match their legal name and gender identity. The law goes into effect Jan 1, 2020 (BAY AREA REPORTER [SAN FRANCISCO]).
NEW YORK Andrew Cuomo (D) signs SB 4070, legislation that requires Empire State public schools to provide sex abuse prevention classes to students and their parents every year in kindergarten through eighth grade (ALBANY TIMES-UNION).
Also in NEW YORK, Gov. Cuomo signs SB 2958, which requires tackle football programs to provide the parents or guardians of all participating children with informational packets regarding concussions and sub-concussive blows, and the injuries that may result from receiving such blows (NEW YORK GOVERNOR’S OFFICE).
The CALIFORNIA Senate Appropriations Committee kills AB 161, a bill that would have banned most paper receipts at large retailers unless customers requested one (LEXISNEXIS STATE NET).
The MICHIGAN Department of Health and Human Services adopts rules that will make the Wolverine State the first in the nation to prohibit online and retail sales of flavored nicotine vaping products. The rules will go into effect immediately (DETROIT FREE PRESS).
The WASHINGTON Legislature filed suit against Gov. Jay Inslee (D), arguing the governor had violated the Evergreen State Constitution when he issued several partial vetoes of the 2019-21 transportation budget. Inslee acknowledged the unusual nature of the vetoes in his veto message, but said they were necessary “to prevent a constitutional violation and to prevent a forced violation of state law.” (WASHINGTON STATE WIRE, LEXISNEXIS STATE NET)
Following two mass shootings in the span of a month, TEXAS Gov. Greg Abbott (R) issued eight executive orders last week intended to bolster reporting requirements for law enforcement involving suspicious individuals and raise public awareness about identifying potential mass shooters. Abbott had previously tweeted that he was working on a legislative package that could include “expedited execution for mass murderers.” Any legislation before lawmakers return in 2021 would require Abbott to call a special session. (TEXAS TRIBUNE, TEXAS GOVERNOR’S OFFICE, HILL)
After an appeals court refused to take up the question, FLORIDA Gov. Ron DeSantis (R) asked the state Supreme Court to rule on whether the Sunshine State medical cannabis program’s vertical integration requirement that requires licensed operators to grow, process and distribute cannabis and derivative products is unconstitutional. A circuit county judge ruled in July that the current system violates the constitutional amendment voters endorsed in 2016. (TAMPA BAY TIMES, MARIJUANA BUSINESS DAILY)
ALABAMA Gov. Kay Ivey (R) said she won’t resign in the wake of her admission that she participated in a racist skit that involved blackface more than 50 years ago while a student at Auburn University. Ivey initially denied she was part of the act, but later admitted she had been in at least one such performance while at the school. She issued a video apology, saying “I offer my heartfelt apologies for the pain and embarrassment this causes, and I will do all I can – going forward – to help show the nation that the Alabama of today is a far cry from the Alabama of the 1960s.” (AL.COM)
CONNECTICUT Gov. Ned Lamont (D) issued Executive Order No. 3, which requires Constitution State regulators to lay out a plan to reach 100 percent carbon-free electricity by 2040. (UTILITY DIVE)
Massachusetts Gov. Charlie Baker (R) was joined last week by six former top state housing officials from thee different gubernatorial administrations in urging Bay State lawmakers to pass a bill before the end of the year to stimulate housing production. Baker filed the measure (HB 3507) to lower the threshold for approving new housing projects from a two-thirds majority in the applicable municipality to a simple majority in February. Lawmakers failed to pass a similar bill last year, and have so far not acted on this year’s bill either.
“For a very long time, we have all acknowledged as a public policy community that we have a problem,” Baker said. “Whether people called it a crisis or a problem or an existential threat, it is all of the above, and it’s really time for us to get something done.”
The proposal has strong support from many local officials and housing advocacy groups, but legislative leaders have refused to bring it to a vote, saying it is not comprehensive enough. (BOSTON HERALD, MASSLIVE.COM, STATE HOUSE NEWS SERVICE [BOSTON])
With the legislative session winding down, California Gov. Gavin Newsom (D) has been steadily working behind the scenes to broker deals on a number of high-impact measures lawmakers are close to sending to his desk.
After negotiating a deal between state teacher unions and charter school advocates last month on legislation (AB 1505) to impose new restrictions on those schools, the governor moved on to working a deal on another controversial issue: rent control. Under that bill (AB 1482), annual rent increases statewide would be capped at 5 percent plus inflation, with renters also receiving protection against being evicted without the landlord offering a valid reason.
A joint statement from Newsom and legislative leaders hailed the bill, saying it would “protect millions of renters from rent-gouging and evictions and build on the Legislature’s work this year to address our broader housing crisis.”
But it did little to appease rent control advocates working to place a new statewide rent control initiative on the 2020 ballot. Voters soundly rejected a similar measure last year, but Michael Weinstein, head of the Los Angeles-based AIDS Healthcare Foundation, which is pushing the measure, said their effort will continue.
Newsom also weighed in last week on two of the highest-profile and controversial measures of the year: AB 5, which would codify a previous court order requiring companies that use so-called gig workers to make most of those workers employees, and SB 276, which would crack down on doctors that issue large numbers of vaccine exemptions. Both measures have drawn copious lobbying for an against, with tech companies spending big money fighting AB 5 and small armies of anti-vaccine protestors descending on the Capitol for every vote on SB 276.
The governor said he supported the vaccine measure, but only with what he called “technical – but important – changes.” The bill’s supporters, however, say that what the governor has asked for, including delaying the bill’s effective date, are much more than minor technical changes. The bill’s author, Dr. Richard Pan (D), has said he’s willing to work with Newsom, but that it is too late to change the bill.
Newsom had stayed out of the AB 5 argument all year before saying last week that he supports the measure and would sign it into law if it gets to him. That sparked a pledge from rideshare companies and other tech firms to spend up to $90 million on a ballot measure to carveout an exemption for their – but nobody else’s - business models.
The session winds up on Sept. 13. (LOS ANGELES TIMES, LEXISNEXIS STATE NET, CALMATTERS)
An annual labor report from the University of WISCONSIN-Madison’s Center on Wisconsin Strategy (COWS) indicates that union membership in the state has declined by 53.9 percent since 2011, three times the 14.9-percent decrease in neighboring Minnesota over the same period and well over the 21.2-percent drop nationally. In 2011, the state passed Act 10, stripping public unions of their bargaining rights, and in 2015 it passed a law allowing union-shop workers to decline paying union dues. (WISCONSIN STATE JOURNAL [MADISON])
The American Civil Liberties Union has filed a federal lawsuit seeking to block a new Tennessee law from taking effect on Oct. 1. The law (HB 1079), enacted in May, would impose civil and criminal penalties on backers of voter registration drives who fail to meet certain requirements. (TENNESSEAN [NASHVILLE], LEXISNEXIS STATE NET)
GEORGIA is scheduled to roll out a new $107 million electronic voting system in time for the state’s presidential primary on March 24. But election officials in several Peach State cities - which are not obligated to use the voting system mandated by the state for county, state and federal elections - say they’ll keep using their existing paper-ballot systems. (ATLANTA JOURNAL-CONSTITUTION)
A three-judge panel consisting of two Democrats and one Republican unanimously ruled last week that legislative district maps drawn by North Carolina’s Republican-controlled General Assembly in 2017 - to replace maps drawn in 2011 that were struck down by the courts - were unconstitutional and must be redrawn before next year’s elections. The judges concluded that the new maps violated the state’s Constitution because “it is the carefully crafted maps, and not the will of the voters that dictate the election outcomes in a significant number of legislative districts and, ultimately, the majority control of the General Assembly.” The state’s Senate leader, Phil Berger (R) said he wouldn’t appeal the decision and would start working on new maps. (RALEIGH NEWS & OBSERVER)
A group called Voter Choice Massachusetts has proposed a ballot measure for the state’s 2020 election that would replace the state’s current winner-take-all election system with a ranked-choice system.
Under a ranked-choice system, voters are asked to rank the candidates for each applicable office in order of preference. Any candidate who receives over 50 percent of the vote in their particular race is declared the winner of that contest. If no candidate receives a majority of the vote, the candidate who receives the lowest number of votes is eliminated and the votes for that candidate are redistributed to the second-choice candidate of each impacted voter. This “instant runoff” process is repeated until one candidate has more than 50 percent of the vote.
Supporters of the idea say it facilitates the election of candidates whose views are more in line with the broader electorate, rather than just the extreme right or left, and encourages voter turnout because more people think their vote will make a difference. But opponents say the system is confusing and leads to election campaigns in which candidates avoid taking a stand on issues to avoid losing the support of voters on either side of them.
Ranked-choice voting isn’t entirely new to the state. The city of Cambridge has used it to elect members of its City Council and School Committee since the 1940s. Other U.S. cities, including San Francisco and Santa Fe, New Mexico, also use it. But Maine is currently the only state that has adopted it, via a 2016 referendum that has been delayed from being implemented until this year by legal challenges. Lawmakers in at least 14 states considered bills dealing with ranked-choice voting in 2017, according to the National Conference of State Legislatures. (GLOUCESTER TIMES)
A newly proposed federal rule would cut off food assistance for 33,000 COLORADO residents, including about 11,000 children. The state currently allows those earning up to twice the federal poverty level to qualify for food assistance and free school lunches, but the new rule would set that limit at 130 percent of the poverty line. (DENVER POST)
MARYLAND Gov. Larry Hogan (R) warned last week that the recommendations of a commission charged with improving the state’s public education system would necessitate either a 39 percent increase in the state income tax, an 89 percent increase in the state sales tax or a 535-percent property tax increase. The Commission on Innovation and Excellence in Education - nicknamed the Kirwan commission after its chairman, William “Brit” Kirwin – has called for higher teacher pay and full-day prekindergarten for low-income 3- and 4-year-olds, among other things, which all told would cost the state an additional $3.8 billion a year. (BALTIMORE SUN)
MONTANA’s lottery director told an interim legislative committee last week that sports betting won’t begin in the state until the end of the year or even later, depending on when new regulations are finalized. In May the state became the seventh to legalize sports betting since the U.S. Supreme Court lifted a federal ban on such wagering last year. (BILLINGS GAZETTE)
--Compiled by KOREY CLARK
Minnesota’s labor market is in pretty good shape right now. The state’s unemployment rate is hovering around 3.4 percent. And with nearly 70 percent of working-age residents employed or looking for jobs, employers have a decent labor pool to draw from.
But economists have been saying for some time that far fewer people will be entering the state’s labor force over the next ten years, making it harder for employers to fill critical jobs.
“It’s definitely a major issue for employers in the state,” said Cameron Macht, regional analysis and outreach manager for the Minnesota Department of Employment and Economic Development.
She added that “looking forward it may become an even bigger deal.”
Census data shows that about 30 percent of working-age Minnesotans aren’t looking for work, and it may be difficult to change that. Over half of the labor-force holdouts are 65 or older, a number that’s expected to increase as more baby boomers retire. Nearly 60 percent of them are women, many of whom may lack sufficient childcare. And about 45 percent have completed no educational studies beyond high school. (MINNEAPOLIS STAR TRIBUNE)
At least 37 states have introduced legislation this year dealing with the cybersecurity of government agencies, 24 of which have enacted such measures, according to information from the National Conference of State Legislatures and LexisNexis State Net. The measures deal with a range of issues, including election cybersecurity, the exemption of government cybersecurity information from public records laws and studies on the use of distributed ledger technologies by government agencies.
This year more than 70 state and local governments have been targeted by hackers that have locked up their computer systems and demanded ransoms to release them. A majority of states have taken legislative action in recent years to protect data held by government agencies. But the current ransomware outbreak could spur state lawmakers to do more.
State and local governments have been dealing with ransomware attacks since at least 2013, according to analysis by the cyber threat intelligence company Recorded Future. That analysis also uncovered 46 ransomware attacks against government entities in 2016, 38 incidents in 2017 - a dip that extended to ransomware attacks against non-governmental organizations as well - and 53 in 2018.
In the first seven months of this year, according to a report released late last month by the cybersecurity group Barracuda Networks, there were already more ransomware attacks on state and local governments than in all of last year. Of the 55 total incidents covered by the report, 38 involved local governments, 14 involved county governments and three involved state governments. And while 16 percent of the targeted municipalities were cities, such as Baltimore, with populations over 300,000, 45 percent had populations of less than 50,000 and 24 percent had populations under 15,000.
“Smaller towns are often more vulnerable because they lack the technology or resources to protect against ransomware attacks,” the report said.
The report included only five of the 22 Texas communities involved in a coordinated ransomware attack reported on Aug. 16 because the other 17 hadn’t been identified at the time of Barracuda’s analysis. Those additional targets bring the total number of state and local governments hit by ransomware attacks this year to 72.
The attacks have caused considerable disruption. Georgia’s Department of Public Safety was hit on July 26. And as the New York Times reported nearly a month later: “The computer network remains down. Every device, including laptops and tablets, is being examined and reconfigured. Much of the email system cannot be entered. State troopers are unable to use computer systems in their patrol cars.”
The Washington Post noted that the attacks had “potentially deadly consequences,” with many having knocked 911 systems and emergency services offline.
To escape such turmoil a few cities have opted to meet the hackers’ ransom demands. In June, Riviera Beach, Florida, a city of about 35,000 people in Palm Beach County, agreed to pay a ransom of $600,000 in bitcoin in the hope of regaining access to its computer systems. A week later another small Florida municipality, Lake City, with a population of about 12,000, said it would pay a $460,000 ransom.
The FBI advises against paying such ransoms not only because it encourages more attacks but also because doing so doesn’t guarantee access to the targeted systems and sometimes just results in additional ransom demands from the perpetrator. But the cost of not paying the ransom can be far higher.
The perpetrators of an attack on Atlanta in March 2018 demanded roughly $51,000 in ransom, which the city refused to pay. Recovering from that attack could end up costing the city $17 million. Baltimore refused to pay the $76,000 ransom hackers demanded in the attack there this year. And the city has estimated the attack will cost it over $18 million in direct recovery expenses and delayed revenue.
Mark Orlando, chief technology officer at Raytheon Cyber Protection Solutions, said the way a city deals with a ransomware attack often depends on its size and resources.
“It’s hard to ignore the pattern that we’ve had some large cities that were able to find the funds to rebuild, and then we’ve seen the smaller municipalities that choose the other direction,” he told The Hill.
The expense for cities that pay the ransom can be even lower if they have cyberinsurance. All but $10,000 of the $460,00 ransom demanded of Lake City will reportedly be covered by its policy. And that alternative was more appealing to the city’s mayor and council than a prolonged recovery that would have taken the city over its $1 million cybersecurity coverage limit, according to a report by ProPublica.
“Our insurance company made [the decision] for us,” said Sgt. Michael Lee, public information officer for the Lake City Police Department. “At the end of the day, it really boils down to a business decision on the insurance side of things: them looking at how much is it going to cost to fix it ourselves and how much is it going to cost to pay the ransom.”
Cyber insurers making that decision could just be compounding the problem. As insurers have been paying out ransoms over the last year, attackers have been demanding more money, observed ProPublica, citing a sixfold increase in the average ransom paid by clients of ransomware response firm Coveware between October 2018 and July 2019, from about $6,000 to about $36,000.
Josh Zelonis, a principal analyst at Forrester Research, also told ProPublica that the increase in ransom payments correlates with the revival in ransomware attacks after their decline two years ago. And the publication referenced indications that hackers may now be specifically targeting organizations with cybersecurity policies.
At its annual meeting in Honolulu this summer - after Riviera Beach and Lake City announced their ransom payments and an editorial was published in the Washington Post calling for a federal law banning such payments - the U.S. Conference of Mayors adopted a resolution pledging that it “stands united against paying ransoms in the event of an IT security breach.” Only the 227 mayors in attendance signed on to the resolution, however. And there are more than 1,400 cities with populations over 30,000 represented by the organization.
Baltimore appears to be the only major U.S. city to have passed an ordinance this year referring specifically to “ransomware,” according to LexisNexis State Net’s local ordinance database. That particular measure makes a $10,000,000 general fund appropriation for the city’s “ransomware response and recovery.” At least six local governments - the cities of Denton, Texas; Houston; Jacksonville, Florida; and San Diego; and the counties of Los Angeles and Saint Louis - have considered ordinances in the last two years dealing with cybersecurity.
State lawmakers, meanwhile, have shown growing concern about the security of government data and critical infrastructure. As of late February, at least 29 states had laws - many enacted within the past two or three years - requiring state government agencies to implement security measures to protect the data they hold, according to the National Conference of State Legislatures.
“A fair number of states have gone from not addressing security practices in statute, or from simply requiring ‘reasonable security practices’ to specifying what those practices should be, like cyber awareness training programs for state employees, periodic security audits or assessments, development of statewide standards and guidelines, or creating a statewide [chief information security officer (CISO)],” Pam Greenberg, who tracks technology issues for NCSL, told SNCJ.
As of April at least 37 states had introduced legislation dealing with government cybersecurity, 16 of which had enacted such measures, according to analysis by the National Conference of State Legislatures. Since then at least eight other states have enacted government cybersecurity bills, LexisNexis State Net’s legislative tracking system shows.
Several of the enacted measures deal with election security, the exemption of government cybersecurity information from public records laws and studies on the use of distributed ledger technologies by government agencies.
Other enactments authorized the use of the national guard for cybersecurity threats (Arkansas HB 1128); expanded a program providing college students with certifications required to do cybersecurity work for government agencies (Maryland HB 1315); allowed public entities to share cybersecurity information (Louisiana SB 46); provided for an electric utility cybersecurity monitor (Texas SB 936); and prohibited public entities from using products or services banned by the U.S. Department of Homeland Security for use on federal computer systems (Virginia SB 1233).
Numerous bills are also still pending, including many more dealing with election security, public records exemptions and distributed ledger studies, along with a few that would make appropriations for cybersecurity programs or establish a state government procurement preference for information technology vendors with cybersecurity insurance.
Recent research indicates that two of the most critical challenges currently facing state and local government IT leaders are inadequate funding and a shortage of cybersecurity talent. Several states appear to be attending to those matters.
But this year’s ransomware outbreak has only added urgency to the larger issue of government cybersecurity. And that’s unlikely to change any time soon. As the cybersecurity firm Barracuda’s analysis revealed, government entities are now “the intended victims of nearly two-thirds of all ransomware attacks.”
Riders on the Boston subway might have done a double take last week at the site of the tall, distinguished guy who looked a lot like the governor. But why would he be on the T? Doesn’t he have a car and a driver to shuttle him about town? Yes, he does. But that didn’t stop Gov. Charlie Baker – all six foot six inches of him – from taking the subway last Monday. As the Boston Globe reports, Baker rode the T to an opening ceremony for a newly renovated station in Quincy as a way to highlight the $36 million in public dollars it took to overhaul the station and prop up the oft-troubled Red Line. Asked if he would do it again, Baker said he would like to. But he also noted, with a glance at the huge entourage accompanying him, that riding it by himself is less likely.