2023 State Legislative Preview
11 things I'll be watching at the state level this year.
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Legislative sessions in most states either started last week or will start up this week, meaning the rush to get items through the often cutthroat state legislative process and signed into law is well and truly underway. (Most state legislative sessions only run until the summer, so the time crunch to get favored legislation through is very real. Some states are starting hearings on top priority bills this week.)
There was even a speaker of the house controversy in Pennsylvania that was straight out of “The West Wing,” and, for the record, was resolved much faster than a far less complicated situation at the federal level.
The 2022 elections showed that corporate power issues really resonate at the state level, so I’m expecting that to be reflected in what folks push legislatively in 2023, particularly in key states, and especially with the federal government taking some big swings that state legislators will want to emulate and exceed.
To that end, below are 11 issues and trends I’ll be keeping an eye on this year. This isn’t a comprehensive list of everything that could possibly happen, of course, and things will inevitably change as events warrant, pushing some items up the list and some off of it entirely.
But my predictions from last year held up pretty well, so hopefully this is a useful guide for folks wondering if and how their elected leaders at the state level will be challenging or abetting corporate power in the coming months.
This list was informed by some reporting and some inside knowledge, but mostly just experience from spending a long time in the state legislative trenches. Did I miss something big? Want to help support a particular effort in a particular state? Leave a comment or send me an email.
Labor Is Coming for Amazon: Amazon last year faced a successful unionization vote for the first time, and several other attempts came close. California enacted and New York approved warehouse worker protection laws squarely aimed at the corporation’s horror show working conditions. I expect those laws, which regulate Amazon’s warehouse quotas, to spread, with several other states taking a swing at one this year. Also, labor unions, in particular the Teamsters, will continue to engage in fights against Amazon, on everything from workplace requirements to tax subsidy deals, at the local level.
Antitrust Fever Spreads: Regular readers will know I have spent an inordinate amount of time thinking about a groundbreaking antitrust bill in New York, the 21st Century Antitrust Act, which has twice passed the state Senate there and run aground in the fetid swamp that is the New York Assembly. Well, get excited, because the idea at its heart — that antitrust law needs a revamp to more adequately rein in the abusive tactics corporations use against local businesses and workers — is spreading. Last year, both Minnesota and Pennsylvania had versions of the same bill, and all three pieces of legislation will be back and better than ever this year. And the timing is good: At nearly the last moment in December, Congress approved the first meaningful update to antitrust law in decades, but the incoming House Republican leadership is very hostile to anything antitrust related, so action will of necessity move to the states.
Ban Secret Deals Gets Real: This is another one with which regular readers will be familiar: The effort to ban nondisclosure agreements from corporate subsidy deals. A bill to eliminate these secret deals successfully passed the New York Senate 61-0 last year: That bill will be back, alongside legislation in Florida, Illinois, Indiana, and maybe some others. This issue was in the wilderness a few years ago and is now taken very seriously, with the backing of a bipartisan coalition, so I think significant attention — and potentially even one of these bills going the distance — is very much in the offing.
Hospital Mergers In the Spotlight: A hefty percentage of the incoming I’m getting about new state issues has to do with hospital mergers, which makes sense. They can devastate local communities, harm workers and patients, and ultimately kill people. There’s an active investigation into a cartoonishly ugly merger in Minnesota, ongoing battles around a consolidated hospital system in North Carolina, and an interesting attempt in Washington state to give the attorney general more power to block mergers on the grounds that patients will be denied care, and especially reproductive care, by the merged entity. I’d also expect more state attorneys general to attempt to block hospital mergers, generally. Finally, there’s some chatter that Indiana will take a serious run at reforming its non-profit hospitals.
Railroad Deals Go Off the Rails: Late last year, the Biden administration and Congress foisted onto striking railroad workers a contract that a lot of them didn’t really want. That deal occurred against a backdrop of further railroad industry consolidation, which has harmed workers significantly. The federal Surface Transportation Board is due to rule on a proposed merger between two more railroad giants, Canadian Pacific and Kansas City Southern, sometime in the first quarter of this year; communities across the Midwest have been fighting that merger, arguing that it would increase rail traffic in their towns to a dangerous degree, including blocking all access to parts of town for emergency vehicles. I expect to see much more local opposition to that deal, and some fireworks if the STB approves it, as well as attempts to legislate better local protections for communities and railroad workers.
Semiconductor Regret Sets In: In the last few years, several states have gifted large subsidy packages to semiconductor manufacturers, a trend that was bolstered by a hefty subsidy package that was approved at the federal level known as the CHIPS Act. But now those deals aren’t looking so great, with hoary details coming out about job quality, and some of the beneficiaries moving toward layoffs and investment reductions rather than expansions. The question is whether those realities temper some of the enthusiasm for throwing huge chunks of change at these corporations, or whether that continues unabated.
AGs Keep Innovating, Especially Against Tech: Several state attorneys general have launched prominent and innovative cases against Big Tech firms in the last few years, with perhaps the most interesting being those filed by Washington, D.C., and California against Amazon for allegedly raising prices across the internet. But there’s plenty more, including a case against Google’s dominance of the advertising technology sector and one that would label Google’s search function the equivalent of a public utility. I expect to see more of these kinds of cases this year, especially with a crop of exciting AGs coming into office this year.
The Ad Tax Is Dead, Long Live the Ad Tax: Maryland’s first-in-the-nation digital advertising tax, which would tax the ad revenue of large tech firms like Amazon and Facebook, has run aground in the courts. But there’s still significant appetite amongst state lawmakers for both tapping this source of revenue and reining in some Big Tech abuses. So states will pivot to something akin to a consumer data tax, which would levy a tax on the accumulation of consumer data by large corporations, with rates rising for corporations that have more users.
Right to Repair Keeps Rolling: New York last year approved the nation’s first right to repair law for consumer electronics, which would require manufacturers to share information with repair shops and no longer require users to go to in-house facilities, like the Apple Store, if they just want to fix devices they’ve bought. However, Gov. Kathy Hochul gutted it before approving it (which is bizarrely legal in New York), so it’s not as strong as what the legislature approved and isn’t applied retroactively. That said, the right to repair movement — which focuses not just on consumer electronics, but also on other items like autos and farm equipment that are subjected to repair restrictions by dominant corporations — has come a long way and I anticipate that things will only be uphill from here. There are lots of states with active legislation, and corporations like Deere are having to make concessions to try and head off even more ambitious bills.
Two Big Subsidy Battles in the South: There are two specific corporate subsidy fights that are worth watching because they both impact important states and will be a harbinger for the politics of those debates going forward, especially among conservatives. First, Florida has to figure out what to do with Disney’s special taxing district, which was famously eliminated last year, but without a plan in place to prevent costs Disney had previously borne from falling splat onto local municipalities. Gov. Ron DeSantis is angling for a presidential run based at least in part on his supposed willingness to challenge corporations; whether he actually supports something that would clip Disney’s wings or just repackages old benefits in a new wrapping will tell us a lot about how serious he is. Meanwhile, in Texas, legislators will have to decide whether to let the expiration of Chapter 313, a notorious corporate giveaway, stand, or whether to cave to corporate interests and bring back a new version. Again, since conservatives largely run the show there, where they land will provide a lot of insight into how far they are willing to go on actually eliminating corporate handouts.
Housing Hopes and Horrors: Several states, as is almost always the case, are going to be tackling affordable housing issues this year, but the issue has new resonance in an era of higher interest rates. This can go one of two ways: Either legislators can go at the concentration of developers that are raising rents and cornering markets, or they can use the tried-and-true playbook of dishing out subsidies to developers for vague promises around affordability that are rarely adequate, if they’re kept at all. Developers have such a grip on local legislatures that I wouldn’t hold my breath for the former.
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— Pat Garofalo