Newsletter — December 7, 2023 | |
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POLICY
ECONOMY
THE LOCAL FRONT
RETAIL THEFT & PUBLIC SAFETY
TRENDS
SAFETY
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Also referred to as the WRAP Act – Washington Recycling and Packaging Act – the draft makes several changes from previous versions. Most notably, the large section on a beverage container recycling program has been removed – and may surface as a stand-alone bill.
WR received an updated draft of the paper and packaging extended producer responsibility (EPR) bill, which will likely be considered during the 2024 Legislative Session.
Rep. Liz Berry (D-36) is leading the effort to adopt legislation similar to several other states, Oregon, California, Colorado, and Maine, that will address the issue of who should be responsible for proper recycling and disposal of packaging.
WR has formed a work group to review and offer solutions to the proposed legislation, most recently on the definition of producer.
Members of WR will continue to work with Rep. Berry to craft legislation that will help clarify the bill language and make it more implementable by retailers and other stakeholders. More updates to follow. If you would like to join the WR member work group – please contact Mark Johnson, WR Sr. VP of Policy & Government Affairs.
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On November 30, 2023, the Washington State Department of Ecology took a significant step in environmental regulation by adopting amendments to two key chapters: Chapter 173-443 WAC, which deals with Hydrofluorocarbons (HFCs), and Chapter 173-455 WAC, concerning the Air Quality Fee Rule. This initiative is in line with the Hydrofluorocarbons – Emissions Reduction law (Chapter 70A.60 RCW) enacted in 2021, directing the Department of Ecology to establish a refrigerant management program to reduce greenhouse gas emissions from large stationary refrigeration and commercial air conditioning systems in Washington.
These amendments introduce new global warming potential (GWP) thresholds for HFCs used in new stationary refrigeration and air conditioning equipment, automotive air conditioner recharge cans, and certain consumer aerosol products. A comprehensive refrigerant management program is also part of the amendments, encompassing registration, leak inspection, repair, recordkeeping, and reporting for large systems.
Service technicians are now required to follow specific practices, and there are updated labeling and disclosure requirements for products. Manufacturers face new labeling and recordkeeping obligations. The amendments also update Chapter 173-443 WAC to reflect these legal changes, including a revised chapter title to "Hydrofluorocarbons (HFCs) and Other Fluorinated Greenhouse Gases."
Additionally, a new section in Chapter 173-455 WAC establishes fees and a fee update process to support the refrigerant management program. These rules impact manufacturers, owners of large commercial refrigeration and air conditioning systems, service technicians, and refrigerant wholesalers, distributors, and reclaimers. They are also relevant to new equipment purchasers and those concerned about climate change.
Set to become effective on December 31, 2023, these rules can be appealed under the Administrative Procedure Act (Chapter 34.05 RCW), as detailed in RCW 34.05.330.
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Governor Jay Inslee’s new budget strategy for Washington State, targeting the fentanyl crisis, may have a direct impact on public safety. With over $50 million in new funding for the 2023-25 biennium, the strategy addresses the escalating opioid epidemic, which has notably impacted tribal communities with a death rate quadruple the state average.
A key focus of the strategy is enhancing treatment and recovery services. The budget supports substance use disorder (SUD) treatment facilities, rental subsidies for SUD patients, and criminal diversion programs. This aligns with evidence showing that long-term drug treatment significantly aids in achieving lasting abstinence.
Education and awareness are critical components. Campaigns like “Friends for Life” and “It Starts with One” educate youth on the dangers of opioids and promote naloxone, an overdose reversal drug. School-based initiatives will further disseminate information about opioid risks and available services.
The introduction of community health hubs will provide comprehensive, accessible services, including SUD treatment and overdose education, addressing the multifaceted nature of addiction.
Improving treatment access, especially in rural and tribal areas, is prioritized. The proposed budget supports expanding Opioid Treatment Programs (OTPs) and initiating Medication for Opioid Use Disorder (MOUD) treatments in correctional facilities.
Harm reduction is another pillar, with the widespread availability of naloxone and the deployment of “Smart Health Machines” containing health supplies crucial for preventing overdoses.
Additionally, the strategy bolsters recovery services and disrupts drug distribution networks. Investments in Oxford Houses and support for behavioral health providers will strengthen recovery networks, while law enforcement efforts aim to dismantle drug rings, reducing the availability of fentanyl.
The comprehensive approach, encompassing education, treatment, harm reduction, and law enforcement, could be a positive step in tackling the fentanyl crisis and improving public safety.
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This week, the newly published Retail Workforce Analysis Report was heard before the House Post Secondary and Workforce Committee. This report is a direct result of the passing of HB 2019 in 2022 with bi-partisan sponsorship to promote retail workforce training.
WR is pleased about the interest in this topic, for the sound research conducted by Western Washington University’s Center for Economic and Business Research, and for the stakeholdering process led by the Workforce Training Board to develop this report.
The report generated retail sector mapping on the following areas: core skills and competencies, retail occupations and career pathways, in-demand professions, educational pathways, credential mapping, and training gaps identification. The research reviewed 126,121 retail job postings in Washington State to develop the mapping of pathways in an interactive web-based tool.
To further the promotion of retail workforce training, stakeholders agreed to two pathways to implement recommendations:
- Education and/or industry standardization of credential programs such as uniform skills, common definitional criteria, and stackable credits that allow employees to build on education over time.
- Industry identification of distinct skills requirements and offer of transparent employment outcomes. When education providers prioritize aligning credentials with industry needs, students and workers will be empowered to make informed choices on education and training. Alternative opportunities for employees to earn industry-recognized certifications and credentials through workplace experience will further retail career outcomes.
These pathways will require education providers and industry employers’ continuous engagement. WR will continue working with policymakers to engage stakeholders to develop pathways with the goal of implementing the report’s specific recommendations.
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The Senate Environment, Energy & Technology Committee held a work session on Friday, December 1, and the hot topic of the day was artificial intelligence (AI). Senator Joe Nguyen (D, 34th LD), chair of the committee, is deeply interested in AI and has been discussing the topic broadly over the interim, including the creation of an AI stakeholder group in which WR participates. The goal of the work session was to advance the discussion of AI and to explore benefits and concerns.
Stakeholders from both the public and private sectors, as well as advocacy groups, spoke about AI and answered questions from committee members. Most notable among those who presented included Microsoft, Salesforce, WaTech, and the ACLU. The message from presenters ranged from concerns that legislation would stem and prevent responsible innovation to the need for ethical and safety considerations.
An “AI Task Force” bill proposed by the Attorney General’s Office is set to be introduced this coming session. The bill calls for the creation of a large-scale task force consisting of stakeholders from a variety of industries, sectors, and advocacy groups and would be a 1–2-year study of AI that would then provide recommendations to the legislature on how to proceed with AI. Based on the feedback from presenters, the task force bill is likely to advance during the session.
WR has held discussions with Senator Nguyen regarding the task force and other proposed AI-related bills and will be speaking to the WR Board of Directors on December 11.
In addition to meeting with legislators, WR has taken a proactive approach to this and future AI legislation by developing an AI workgroup. The workgroup has met several times during the interim and plans to continue regular meetings to keep members apprised of the introduction and advancement of AI legislation.
If you have an interest in joining the workgroup, please email Crystal Leatherman at cleatherman@washingtonretail.org.
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In a strategic move to combat organized retail crime (ORC), retailers and lawmakers are pushing for the passage of the Combating Organized Retail Crime Act (CORCA). This legislation is a critical part of a wider effort to tackle ORC.
The hard work of retail advocates has led to 16 new members of Congress, comprising 13 House representatives and three senators, endorsing the bill. The recent surge in support has brought the total to 92 House sponsors, including Washington Representative Cathy McMorris Rodgers, a prominent retail advocate, and 13 Senate cosponsors.
The momentum behind CORCA is expected to continue, with additional lawmakers indicating their readiness to support the bill in the upcoming weeks. This growing backing underscores the bill's importance in addressing the challenges posed by ORC, which significantly impacts retail profits, employee safety, and consumer costs.
CORCA aims to establish a multi-agency group under the Department of Homeland Security to centralize information from various law enforcement agencies, enhancing the ability to combat ORC effectively. This legislation, along with other measures like the INFORM Act, is seen as vital in providing a more robust legal framework to prosecute ORC.
The retail community is encouraged to maintain the momentum by participating in the ongoing grassroots campaign. The collective effort is crucial for ensuring the passage of this legislation. As the legislative year progresses, the retail community's continued support and active involvement will be pivotal in moving the bill through the necessary stages and ultimately securing its enactment.
Read more on CNBC
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By: Emily Makings — Washington Research Council
The November forecast of revenues from funds subject to the outlook (NGFO) is up compared to the September forecast. Compared to the March revenue forecast (on which the enacted 2023–25 budget is based), the current forecast is up $2.933 billion (over the 2021–23, 2023–25, and 2025–27 biennia.)
That increase includes $588 million in 2021–23, which ended June 30. Most of the 2021–23 increase from March to November came in the education legacy trust account (ELTA), which is a fund subject to the outlook (along with the general fund–-state, the opportunity pathways account, and the workforce education investment account). In turn, over half of the ELTA increase in 2021–23 is attributable to capital gains tax revenues. The March 2023 forecast estimated that capital gains tax revenues to the ELTA would be $248.0 million for 2021–23. The actual figure was $500.0 million.
According to the Economic and Revenue Forecast Council, the actual amount collected from the capital gains tax in 2021–23 was $847.5 million. Of that, $500.0 million went to the ELTA and $347.5 million went to the common school construction account. According to the Department of Revenue, the state collected a net total of $889.3 million from the capital gains tax in calendar year 2023. Thus, $41.8 million of taxes paid on 2022 activity will be accounted for as fiscal year 2024 revenues.
Read the entire article from the Washington Research Council
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In late November 2023, Seattle’s outgoing City Council passed a significant $7.7 billion supplemental budget for 2024, leaving a complex financial legacy for the incoming council. This budget, the last for six of the nine members, has two critical implications:
- Insufficient Addressing of Future Deficits: The budget does little to mitigate the anticipated deficits of $221 million in 2025 and $207 million in 2026.
- Increased Burden on Businesses: Despite high vacancy rates in downtown offices and stores, the council raised the city’s Payroll Expense Tax by 6.5%, exacerbating the cost of doing business in Seattle.
Like the State of Washington, Seattle operates on a biennial budget cycle. The council’s recent adjustments were intended to refine the biannual budget established in November 2022. However, with significant deficits on the horizon, the departing council members shirked the responsibility of addressing the financial issues stemming from their previous decisions. Instead of initiating substantial budget cuts, they passed 120 amendments, many of which increased taxpayer funding for their favored projects. For instance, Councilmember Lisa Herbold allocated an extra half million dollars for a gun violence reduction initiative.
The council acknowledged the looming budget crisis by increasing the controversial Payroll Expense Tax, which previously led major employers to relocate thousands of jobs out of the city. This hike will likely drive more businesses away and deter new ones from filling the vacant spaces in downtown Seattle.
Seattle’s budget has surged from $4 billion in 2013 to $7.7 billion today. Despite a 94% increase in tax collection, the city’s population and job growth have not kept pace, indicating a disproportionate tax burden. This period has seen worsening homelessness, drug abuse, violent crime, retail theft, housing affordability, police understaffing, and traffic congestion despite the doubled taxes and budget.
The new council, set to take office in the new year, is expected to pursue moderate solutions.
Read the article from Change Washington
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In September, four members of the King County Council proposed legislation to create a new minimum wage standard for unincorporated areas of the County.
The legislation would raise the minimum wage to $18.99 for employers with 500 or more employees. For businesses with 15 or fewer employees and less than $2 million in annual revenue, the minimum wage would start at $15.99. This gap would narrow by 50 cents a year until parity is achieved. For businesses with between 15 and 500 employees, the minimum wage would start at $16.99 and rise by $1 a year until it catches up to the big business minimum wage. The minimum wage would be indexed to inflation at all three wage levels.
The Council’s Transportation, Economy and Environment Committee held hearings on the legislation on October 17 and November 16, as did the full Council on November 28. The Council deferred further action on the legislation to 2024.
On January 1, 2024, the Seattle minimum wage for employers with 501 or more employees will rise to $19.97 per hour. The Washington State minimum wage will jump to $16.28 per hour—up from $15.74 in 2023. Seattle and Washington have the highest city and state minimum wage rates in the country.
WR will send a letter to the King County Council in January to express its opposition to creating a new minimum wage in unincorporated King County.
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The Washington State Senate Labor & Commerce Committee recently focused on the growing issue of organized retail crime (ORC) and its impact on public safety. Chaired by Senator Karen Keiser [D-33], the committee heard testimonies from key figures about efforts to combat this escalating problem.
Mark Johnson, WR’s Sr. VP of Policy & Government Affairs, highlighted the negative impact of ORC on Washington state businesses and public safety. He emphasized the need for effective strategies to mitigate these crimes.
The well-attended work session allowed WR to focus on the challenges facing retailers. WR is addressing these challenges with multi-pronged solutions, including:
- Education of policymakers, city leaders, and retailers
- Telling the stories of retailers’ experiences
- Supporting policies that allow police vehicle pursuits for property crimes and increasing penalties for multiple accomplices and repeat offenders
- Offering support materials, including WR’s Guide to Navigating Public Safety & Retail Crime resource guide
- Participating in the state’s ORC task force
- Supporting small retailer theft prevention grants
- Championing diversion programs for mental illness and substance addiction treatment
In response to Senator Kaiser’s request, the committee members received WR’s free resource, the “Guide to Navigating Public Safety & Retail Crime,” which offers insights and strategies for retailers to combat retail crime. The Guide is among numerous free resources WR makes available to all retailers.
The ORC Task Force is comprised of members from various law enforcement levels, loss prevention, retailers, and organizations like WR. The task force focuses on communication and collaboration across multiple jurisdictions. Their unit’s hard work recently led to its first criminal prosecution filing.
During the AG’s office presentation, it was announced that Assistant Attorney General Kent Liu had been selected as the leader of the new Organized Retail Crime Unit. Liu is a criminal prosecutor who has worked for the AGO for over 15 years.
WR is working closely with a coalition of stakeholders on solutions at all levels to help increase public safety, reduce retail theft, and thwart organized retail crime.
This issue will be considered when the Legislature convenes for a 60-day session on January 8, 2024.
Watch the hearing here. (Mark Johnson’s testimony begins at 18-minutes, 8-seconds.)
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A “prolonged” fight in a north Spokane Walmart store on Sunday morning resulted in the shooting death of a man suspected of shoplifting.
The incident began inside the Walmart store, where the suspect was allegedly involved in shoplifting. The situation quickly escalated as police officers intervened, leading to a physical confrontation. During the struggle, the suspect was shot, and despite immediate first-aid efforts by responders, he succumbed to his injuries at the scene.
Two Spokane police officers were injured during a fight between the suspect and the officers, with one officer taken to a hospital, according to Police Chief Craig Meidl.
Increased violence in stores has become a growing concern for many retailers as they prioritize keeping their associates and customers safe. “It’s evident that our ongoing battle against retail violence remains a critical concern. We are committed to fostering robust partnerships with local law enforcement and legal entities to ensure the safety of our associates and customers,” said Renée Sunde, President & CEO of Washington Retail Association in a statement. “This incident underscores the need for a sustained, multi-pronged strategy to address these challenges effectively.”
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The Attorney General's (AG) Organized Retail Crime (ORC) Task Force is set to convene for its 5th meeting on Tuesday, January 23. The meeting is scheduled from 1:00pm to 4:00pm and will take place at the Attorney General’s office in Seattle. The meeting will also be accessible via video conference.
The ORC Task Force, under the leadership of Attorney General Bob Ferguson, plays a crucial role in addressing the challenges posed by organized retail crime. This type of crime not only affects retailers but also has broader implications for community safety and economic stability.
One of the primary focuses of the meeting will be hearing updates from the newly established ORC Unit. This unit, a pivotal part of the task force, is dedicated to tackling the complexities and evolving nature of organized retail crime. The task force will also engage in discussions about ORC legislation proposed for the 2024 legislative session.
For those interested in attending, either in person or online, an RSVP is required. The AG’s office has emphasized the need for registration, which will be facilitated through an online registration page. While the registration portal is not yet open, look for our email announcement that the registration form is live.
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Recent discussions around retail crime, particularly shoplifting, have sparked controversy. Last week, a New York Times article suggested that the surge in shoplifting is overstated and localized to certain cities. However, this view is challenged by experts who point out significant flaws in the reporting and perception of retail crime.
Firstly, the categorization of retail theft varies widely, often labeled as shoplifting, theft, robbery, or property crime, depending on the jurisdiction and even the officer reporting the incident. This inconsistency leads to a misleading representation of the full scale of the problem. Additionally, retail theft is notoriously underreported. Law enforcement agencies, especially in large urban areas, are stretched thin, often treating retail theft as a low-priority issue. This underreporting is not confined to New York City; cities like Seattle, San Francisco, Los Angeles, and Chicago contribute significantly to the problem.
The argument that retailers use theft as a scapegoat for declining sales is flawed. Retailers invest heavily in anti-theft measures, which would be counterproductive if the issue were not serious. These measures can inconvenience legitimate customers and potentially dampen sales, indicating that retailers would not undertake such steps without a genuine need.
Moreover, the impact of retail theft extends beyond the stores. It affects tax revenue, as stolen items do not contribute to sales tax. Retailers operating on narrow profit margins are forced to raise prices or sell more, affecting consumers. The closure of stores due to theft leads to loss of convenient access to goods and services, impacting local economies and communities.
The Retail Industry Leaders Association (RILA) emphasizes that organized retail crime is a nationwide issue, not confined to big cities or certain political landscapes. The challenge is compounded by the difficulty in tracking retail theft accurately, as law enforcement often prioritizes other crimes, leading to underreporting of shoplifting incidents.
Retailers are not only concerned about their bottom line but also the safety of their employees and customers. They are actively engaged in community partnerships to address broader societal issues contributing to retail crime, such as addiction, homelessness, and mental health.
In conclusion, dismissing retail theft as a minor or localized issue overlooks the complex, multifaceted nature of the problem. It is a significant concern that affects retailers, consumers, and communities nationwide, necessitating a more nuanced and informed approach to understanding and addressing it.
Read more on the myths versus facts
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Black Friday 2023, a pivotal day for the retail industry, unfolded under the shadow of persistent inflation, influencing consumer spending habits. Retailers, anticipating cautious consumer behavior, initiated promotional activities earlier than usual in response to discerning and selective shopping trends.
Despite these challenges, Black Friday saw a record $9.8 billion in online sales, a 7.5% increase from the previous year, as reported by Adobe Analytics. However, this surge in online spending didn't prevent TD Cowen from lowering its holiday season growth expectations from 4-5% to 2-3%, slightly more optimistic than the National Retail Federation's 3-4% projection.
Mobile and online shopping emerged as clear winners. Adobe Analytics predicted mobile shopping to surpass desktop purchases for the first time this holiday season. Smartphones accounted for 54% of online sales on Black Friday, a testament to improved mobile shopping experiences.
However, the traditional doorbuster deals in physical stores witnessed a decline. The urgency that once characterized Black Friday shopping in stores has diminished, with consumers increasingly turning to online options.
The calendar also played a role, with an extra weekend before Christmas potentially boosting sales. Additionally, the fiscal year's extension to 53 weeks may result in increased revenue for retailers.
Read the full story by RetailDive
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Safety managers are often frustrated that workplace incidents keep happening despite offering great safety policies, training programs, and personal protective equipment (PPE) to their workers.
It is important to recognize that employees’ follow-through with safety practices is determined by each individual’s risk perception and motivation.
Employees have different risk perceptions, and they subconsciously calculate the risk based on their unique perspectives. Their behaviors at work, however, are determined by each employee’s unique experiences, traits, abilities, and attitudes related to safety.
The roles of feeling and emotion also determine worker motivation for following through with safety practices. Workers who feel positive about their relationship with supervisors and management are motivated to follow through with safety.
These factors also help explain why younger workers incur more accidents than older workers. Younger workers do not have the same risk perception as mature workers, and they are more likely to break the rules than seasoned workers with more life experiences.
Management can help improve workers’ perception of risk by considering these questions:
- What motivates your employees to choose risky behavior versus a safer alternative?
- Are they even aware that they are making these decisions?
- Are you using safety meetings to motivate and communicate safety information?
Re-evaluate your company’s safety messaging so it can be delivered in a way that ‘sinks-in’ better with the audience.
Our safety team is available to help members improve their safety program beyond compliance toward quality safety practices. Contact us at safety@waretailservices.com to learn more.
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WR diversity statement
WR is committed to the principles of justice, equity, diversity, and inclusion. We strive to create a safe, welcoming environment in which these principles can thrive.
We value all people regardless of race, ethnicity, gender, religion, age, identity, sexual orientation, nationality, or disability, and that is the foundation of our commitment to those we serve.
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Renée Sunde, President/CEO — 360.200.6450 — Email
Mark Johnson, Sr. VP of Policy & Government Affairs — 360.943.0667 — Email
Crystal Leatherman, State & Local GA Manager — 360.200-6453 — Email
Rose Gundersen, VP of Operations & Retail Services — 360.200.6452 — Email
Robert B. Haase, Director of Communications — 360.753.8742 — Email
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