Officials: Election holds mixed results for business
Phil Castle, The Business Times
Are businesses better off or worse off following the election?
Diane Schwenke, for one, doesn’t believe there’s a simple answer. “I think it’s a mixed bag,” said Schwenke, president and chief executive officer of the Grand Junction Area Chamber of Commerce.
Tony Gagliardi, Colorado director of the National Federation of Independent Business, agreed. “I see a status quo.”
A ballot measure that would have implemented a single-payer health care system in Colorado failed, preventing what Schwenke and Gagliardi said would have been costly mistake.
But another measure increasing the state minimum wage to $12 an hour by 2020 passed and could cost jobs and end up hurting workers, Schwenke and Gagliardi said.
Meanwhile, control of the Colorado Legislature remains split with Republicans in the majority in the Senate and Democrats in the majority in the House.
The effects of a presidential contest that will put Donald Trump in the White House remain to be seen, but could bode well for the energy sector and business in general.
With the exception of the passage of the minimum wage measure, election results were mostly favorable for the proposals and candidates on which the chamber board of directors took a position, Schwenke said.
The failure of Amendment 69, a proposed constitutional amendment that would have created the so-called ColoradoCare single-payer health care system, topped the list, she said.
The chamber came out in opposition to Amendment 69 early on as a potentially costly and risky plan that could hurt businesses and affect medical care. “That was going to be a major job killer,” Schwenke said.
The NFIB surveyed its nearly 5,000 members in Colorado, most of them small business owners, and 98 percent of those who responded opposed Amendment 69, Gagliardi said.
Amendment 69 would’ve funded a comprehensive health care system with a 10 percent tax divided at 6.67 percent for employers and 3.33 percent for employees. Those earning income other than that from payrolls also would’ve paid a 10 percent tax. People would’ve selected their medical providers, but the bills would’ve been paid by the ColoradoCare system rather than private insurers. A 21-member board comprised of people from across the state would’ve overseen the system.
Gagliardi said Colorado would’ve imposed one of the highest tax rates in the United States had Amendment 69 passed. Moreover, the board would’ve overseen a $25 billion a year operation, a bigger enterprise than McDonald’s or Nike.
After failing in the election by more than 3-to-1 margin, Gagliardi doesn’t expect any similar measures to return to the ballot. “It should be a dead issue.”
Amendment 70, on the other hand, passed with more than 55 percent of the vote and will increase the statewide minimum wage 90 cents an hour a year until it reaches $12 an hour by 2020. That’s a nearly 30 percent increase over the current minimum wage of $9.30 an hour.
The Grand Junction chamber and NFIB opposed the measure because of the effects of higher wages on small business operations.
Schwenke said she’s concerned businesses will be forced to lay off employees or cut hours to counter higher labor costs. The other result, she said, could be higher prices — especially for restaurants.
Higher minimum wages also could hurt nonprofit organizations that can’t raise prices to cover costs, Schwenke said.
Gagliardi agreed and said yet another outcome could be increased automation — the use of kiosks rather than people to take orders at restaurants, for example.
Higher minimum wages could actually end up hurting workers, the two said, in reducing the availability of jobs for young and unskilled applicants.
The better approach, Schwenke said, would be to promote work force development and help workers gain skills that earn them higher wages.
Meanwhile, yet another ballot measure passed that will change the way ballot measures change the Colorado Constitution.
Amendment 71 requires that petitions for a citizen-initiated amendment to the constitution include signatures from a minimum of 2 percent of registered voters from each of the 35 state senate districts across the state.
Old provisions required the signatures of at least 5 percent of the total number of votes cast for the office of Colorado secretary of state in the preceding general election — signatures that could be gathered anywhere.
Schwenke said the chamber board endorsed Amendment 71 because the requirement for a broader distribution of signatures gives voters across the state a say in the process, not just voters in more populated urban areas of Denver and the Front Range.
Another result of passage of Amendment 71, Schwenke said, likely will be increased efforts to effect change in the State Legislature and through statutory ballot measures rather than through proposed amendments to the Colorado Constitution.
Control of the State Legislature remained unchanged in the election. State Reps. Yeulin Willett and Dan Thurlow, both Republicans from Grand Junction, were re-elected in Districts 54 and 55, respectively.
Gagliardi said there’s an advantage to different parties controlling different houses of the Legislature and governor’s office because a more bipartisan approach is required to enact legislation.
In Mesa County, Republicans John Justman and Rose Pugliese won re-election to the County Commission.
While Democrat Hillary Clinton carried Colorado with 48 percent of the vote, her Republican rival won the presidential election nationwide.
Schwenke said the exact implications of a Trump administration aren’t yet known, but there are early indications his election could benefit the energy sector by easing federal regulations that effect coal, natural gas and oil exploration and production. That could help businesses that operate in Western Colorado.
“I think we’re probably heading into a climate of a much more favorable administration role on energy,” she said.
A similar effort to reverse what Schwenke said has been a trend of legislating by regulation could benefit business in general whether those regulations involve land management, labor or banking. “I really do think that will make a difference,” she said.