Small Business Reacts to Governor Brown’s Budget Announcement

Tom Scott
CA Executive Director, National Federation of Independent Business

Small business owners have been among the few voices to insist that the State of California is on the verge of an economic downturn, and today Governor Brown only affirmed this sentiment. The compounding pressures of a $15 state minimum wage, protected leave mandates, and mounting environmental regulations have all caused small business owners great anxiety, which puts a drag on hiring and economic growth. In the face of a $2 billion budget deficit, our focus should be on supporting small business to grow the economy to sustainably improve the health of our state finances.

Transportation, affordable housing, and cap-and-trade revenues are all issues that greatly impact the day-to-day operations of small business owners. The Governor has called on the Legislature to send him tax increases on drivers to fund transportation projects. Our small business members know the state budget has existing transportation dollars, which should be used to fix our roads rather than further taxing small businesses and working families.

Without affordable housing, we cannot have a thriving workforce, and we agree with the Governor’s comment this morning: ‘We’ve got to bring down the cost structure of housing, not just subsidize it…we need to cut the red tape, and increase the stock to bring down the costs.’ We hope this translates to meaningful CEQA reform and other regulatory relief for homebuilding in this state.

Finally, our small businesses have serious concern with codifying the extension of Cap-and-Trade beyond 2020. This tax on small business and consumers puts additional cost pressures on our struggling job creators in a state that only contributes 1% to global greenhouse gas emissions. California gains nothing for our environmental climate or business climate by pushing our jobs and emissions to neighboring states.

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