Smith Hill to Capitol Hill: Society's Government Update May 30, 2019

Welcome to another edition of the Society’s Statehouse Update, keeping you informed of the activities of local, state and federal government “on the hills” from Smith Hill to Capitol Hill.

State Government & RI General Assembly activity: The RI Society of CPAs, in partnership with the RI Business Coalition, has taken advocacy positions on these bills in recent days:

Opposed to S. 0830, Hawkins-Slater Medical Marijuana Act:
We joined in opposition to the Edward O. Hawkins and Thomas C. Slater Medical Marijuana Act for several reasons and joined in a letter of opposition to Senate Judiciary Committee Chair Erin Lynch Prata. The central opposition is that this legislation would enable individuals to claim “acute pain” as a “debilitating medical condition” for which medical marijuana could be prescribed and would create confusion and add delay and cost to Rhode Island’s workers’ compensation system. Acute pain is the unfortunate result of many work-related injuries, and while government medical assistance programs and private health insurers are not currently required to reimburse the costs of medical marijuana under the present medical marijuana statute, this is not the case for workers’ compensation insurance. If the bill passes as proposed, we are concerned that injured workers may choose to treat their pain with medical marijuana (in spite scientific evidence suggesting marijuana is not ideal for the management of acute pain). We understand this treatment is not presently reimbursable in most circumstances because it violates federal law and it is not FDA approved.

The bill would allow for three “limited compassion centers” to operate in Rhode Island in addition to the three compassion centers already permitted under state law. It would also enable individuals to claim “acute pain” as a “debilitating medical condition” for which medical marijuana could be prescribed. It would also leave would leave the issue of reimbursement to the Courts and ultimately adds to the cost of doing business in our state and does so without proven scientific or medical reasoning.
Note: This action was deemed egregious by multiple watchdog groups. The concern was echoed by the Providence Journal newspaper’s own editorial citing the “triopoly” the three existing compassion centers have had with power and influence. The editorial called out the Senate President, the Chair of the House Labor Committee Ciccone, the Chair of the Committee on Rules and the Senate Majority Leader for their actions. Watchdog and business groups, including banking and accounting firms have cited the need for increased competition and transparency with this industry and have concerns with the lack of oversight.

Opposed to H-6087, Healthy Workplaces Act: RISCPA joined in a letter of opposition sent to Labor Committee Chair Anastasia Williams on this bill which would expand legal protection from abusive conduct in the workplace to behavior that is not necessarily grounded in protected class status as provided for under existing employment discrimination statutes. Naturally RISCPA and the Business Coalition do not support workplace bullying or abuse, however we do have some concerns about whether the state can or should step in to protect someone from the actions and behaviors of others that the person may find offensive or otherwise unpleasant, especially since current federal and state law already protects employees from discrimination. We are concerned about the liability these bills would create for employers in the state.

Support H-6011, Education-Curriculum Bill: RISCPA joined in a letter of support for this legislation sent to Health, Education & Welfare (HEW) Chair Joseph McNamara. The legislation, part of a wider Education Reform bill package, directs the RI Department of Education (RIDE) to provide professional support and assistance in partnership with local education agencies (LEAs) to increase student achievement consistent with state standards. It directs RIDE to implement new curriculum by assigning LEA assistance partners, assisting in the development of ongoing systems to support curriculum implementation and revision work, and providing professional development opportunities to teachers and administrators.

Support S-0134, Lowering Non-Resident Withholding Tax: RISCPA issued a letter of support to Senate Finance Committee Chair William J. Conley, Jr. on this bill which would lower the current withholding rate for corporate entities selling real estate in Rhode Island from 9.0 percent to 7.0 percent. The bill would simplify Rhode Island’s tax code and allay confusion regarding real estate transactions which were not included in the original corporate tax rate reduction of 2015.

Opposed to S-0798, Opioid Stewardship Act: RISCPA joined in a letter of opposition to Senate Finance Committee Chair William Conley, Jr., on this bill which would require manufacturers and distributors of opioids in the state to make quarterly payments into a new “opioid stewardship fund” which would be used to support state programs for opioid treatment, recovery, prevention and education services.

While the Business Coalition is supportive of efforts to tackle opioid addiction, this policy will ultimately do more harm than good. S. 0798 would place a substantial tax on the distributors and manufacturers who provide opioids for health care facilities, including assisted living and hospice programs. In turn, increased cost would be passed onto patients with legitimate need of pain treatment, including hospice, cancer care, and chronic pain patients. This, moreover, would drive up the overall cost of healthcare in Rhode Island, particularly (but not exclusively) in hospitals, care centers, and hospice centers. In addition to patients and businesses, the State of Rhode Island would face pressure if this bill moves forward; the state is obligated to support its Medicaid population and Medicaid tends to be a large purchaser of opioids. Finally, a major new tax on opioid manufacturers and distributors may lead to disruptions in distribution chains, impacting access for patients with sincere medical need.

Washington, DC:

State Visit to Japan: President Trump returned this week from a whirlwind state visit to Japan which included ceremonies and an exclusive meeting with the new Emperor of Japan, Emperor Naruhito and meetings with Japanese Prime Minister Shinzo Abe. North Korea conducted missile tests that coincided with Trump’s visit. His reluctance to criticize the missile tests while being hosted by Japanese leaders, who feel threatened by North Korea, has drawn sharp criticism in recent days.

Disaster Relief bill: A critically needed Disaster Relief bill has stalled in Congress due to a single lawmaker’s vote against passage on two separate occasions. The $19 billion relief aid bill is for states devastated by flooding, wildfires, tornadoes and other natural disasters. Congress is taking a new vote in coming days.

Federal SECURE Act: Lastly, the House voted to approve The Setting Every Community Up for Retirement Enhancement Act, known as the SECURE Act, and it is widely expected to move forward in the Senate. Some experts are saying it is one of the most important potential changes to retirement rules seen in years. Some important highlights of the proposed bill include:
-a provision to make it easier for small businesses to band together to offer retirement plans to employees;
-an option for long-term part-time employees to gain access to workplace retirement plans;
-a proposed raising of the age (the required minimum distribution age) at which Americans must start drawing from retirement savings, from 70½ to 72, as people are living and working longer.
- calls for providing more years for people to contribute to individual retirement accounts, for the same reason.
Additionally, it creates new rules that could expand lifetime-income options within workplace plans, such as annuities, to help people establish reliable stream of income in retirement. It would also make it easier for employees to transfer retirement plan assets when they change jobs. Other notable components include allowing employees to withdraw savings penalty free for the birth or adoption of a child. Also, proposes to fix a component of the 2017 tax overhaul that raised taxes on benefits received by family members of deceased military veterans, as well as taxes on some students and members of Native American tribes. We will be closely monitoring the SECURE Act as it proceeds through Congress.

Stay Tuned!


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