NVTC

Advocacy

2019 General Assembly Session Wrap-up

On February 24th, the Virginia General Assembly adjourned sine die concluding the 2019 legislative session. During the 47-day session, which lasted one day longer than scheduled, the General Assembly considered more than 2,300 bills and resolutions. At the close of the session, 950 bills were approved and sent to the Governor for his review and action. The General Assembly will reconvene for a one-day veto session on April 3rd to act on bills that are vetoed or amended by Gov. Northam.

NVTC's specific legislative priorities for the 2019 legislative session were outlined in a letter to policymakers before the session began and NVTC maintained a full-time presence in Richmond throughout the session to actively advocate on behalf of the technology community. NVTC's Public Policy Advocacy Team included NVTC Vice President of Policy Josh Levi, NVTC Director of Policy, Troy Murphy, and Myles Louria, Senior Director of Governmental Affairs, Hunton Andrews Kurth LLP.

Below you will find a breakdown of highlights from this session, including:

  • Legislation of interest that was approved during the General Assembly session;
  • Legislation of interest that did not move forward this session; and
  • Budget items of interest to the technology community.

Legislation of interest to Northern Virginia's technology community that was approved during the General Assembly session:

Tax Conformity and Tax Policy – GILTI and Net Interest

NVTC was part of a coalition of Virginia businesses and organizations led by Capital One which advocated that Virginia preserve the ability for businesses to deduct Global Intangible Low Taxed Income (GILTI) (overseas income) and Net Interest, notwithstanding efforts to conform Virginia’s tax code with the federal Tax Cuts and Jobs Act (TCJA), which passed the US Congress in December of 2017.

SB 1372 and HB 2529 reflect compromise legislation that was approved by the Assembly and which conforms Virginia’s tax code with the federal Tax Cuts and Jobs Act (TCJA). The legislation:

  • De-conforms the global intangible low-taxed income (GILTI), preserving the ability of Virginia business to utilize this deduction
  • Includes a deduction for 20% of net interest expenses
  • Provides immediate $110 tax refund for individuals and $220 for couples
  • Increases the standard deduction to $4,500 for individuals and $9,000 for couples
  • Maintains current state law regarding state and local taxes (SALT)
  • Creates a "Taxpayer Relief Fund" of $189 million
The legislation passed the General Assembly and has been signed into law by Gov. Northam.

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Limitations of Liability in State IT Procurements

NVTC was part of a coalition led by the Greater Richmond Technology Council, CGI, and Deloitte which sought to advance SB 1329 and HB 2324 aimed at limiting liability in major IT contracts to 2X the value of the contract.

The legislation passed the General Assembly and has been signed into law by Gov. Northam.

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Amazon Incentive Legislation/Major Headquarters Workforce Grant Fund

NVTC supported SB 1255 and HB 2356 which create the Major Headquarters Workforce Grant Fund to provide the incentive package to support Amazon’s major new corporate headquarters in National Landing ($2.5 billion investment, 25,000+ new jobs).

The legislation passed the General Assembly and has been signed into law by Gov. Northam.

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NVTC supported legislation sponsored by Sen. Ruff (SB 1617) and Del. Rush (HB 2490) which creates the Tech Talent Investment Program and Fund. The fund establishes the state’s higher education commitments as part of the Amazon incentive package. It includes more than $700 million in funding to increase the number of bachelor's degrees awarded in computer science, computer engineering, and closely related fields by at least 25,000 degrees. It also includes $375 million for master’s degree programs that Virginia Tech and George Mason University will establish to support more technology degrees in our region.

The legislation passed the General Assembly and has been signed into law by Gov. Northam.

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Micron Incentive Legislation/Semiconductor Manufacturing Grant Fund

NVTC supported SB 1370 and HB 2180 which creates the Semiconductor Manufacturing Grant Fund to provide incentive grants to support Micron’s $3 billion expansion in Manassas, which will create 1,100 new jobs.

The legislation passed the General Assembly and has been signed into law by Gov. Northam.

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Inclusion of Telework Jobs in the "New Jobs" Requirement

NVTC supported SB 1463 which will give the Virginia Economic Development Partnership (VEDP), or any other state agency, the ability to count teleworking jobs or offsite jobs in the "new jobs" definition. The legislation is intended to connect technology companies in Northern Virginia, or other parts of the state, with workers around the state when needed.

The legislation passed the General Assembly and has been signed into law by Gov. Northam.

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Unmanned Aerial Systems (UAS)

HB 1636 aims to prevent UAS takeoff and landings on or near military airfields. The legislation provides for criminal penalties (Class 1 misdemeanor) for the takeoff or landing in violation of current Federal Aviation Administration Special Security Instructions and UAS security sensitive airspace restrictions.

The legislation passed the General Assembly and has been signed into law by Gov. Northam.

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Microcredential Program

NVTC supported SB 1419 and HB 2217, which originated from CodeVA, and would allow the Department of Education to set up a micro-credentialing program to offer a professional development tool for teachers in high demand STEM fields. This type of program is already being utilized in multiple states including Texas, North Carolina, Massachusetts and Wyoming. The bill is intended to increase teachers’ access to professional development in critical STEM fields like computer science and coding.

The legislation passed the General Assembly and has been signed into law by Gov. Northam.
Specific legislation of interest to Northern Virginia's technology community that did not move forward this Session, includes:

Consolidating and Aligning Research, Commercialization and Entrepreneurship Initiatives

NVTC's Legislative Agenda called for increasing statewide support for startup activity by consolidating research, commercialization and entrepreneurial ecosystem programs and initiatives under one authority and designating the Center for Innovative Technology (CIT) as the managing non-profit for the consolidated authority and its programs. NVTC also supported maintaining and growing targeted initiatives, incentives, and tax policies that have a successful track record in driving research and pre-company research grants, seed money to grow innovative companies and the funding ecology and support that is critical for a sustainable, entrepreneurial technology ecosystem.

While several bills were introduced this session laying out different visions and strategies for a consolidation initiative, the General Assembly session did not produce a consensus regarding the best way to proceed.

The Northam Administration has indicated they will organize a work group to propose a consolidation strategy and recommendations for the Governor and General Assembly to consider during the 2020 legislative session.

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Employment Nondiscrimination

NVTC has worked to support legislation which would prohibit public sector employment discrimination on the basis of sexual orientation. This legislation fosters fair treatment in the workplace, benefits technology employers by promoting employment and retention of a critical talent pool and benefits higher education institutions in their recruitment and retention of faculty and researchers who train the workforce and help drive our innovation economy. In that effort, NVTC supported SB 998 and HB 2067, which aimed to prohibit public sector employment discrimination on the basis of sexual orientation.

SB 998 passed the Senate 28-12. However, both SB 998 and HB 2067 did not move forward in the House General Laws Committee.

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Guidance to State Public Bodies Regarding Purchases of Materials Made in the United States

SB 1099 would have directed the Department of General Services to develop and maintain a guidance document assisting state public bodies to purchase (i) iron and steel that are made in the United States and (ii) manufactured goods with at least 50 percent of the constituent parts and materials originating in the United States.

The legislation passed the Senate of Virginia 35-5. However, it was defeated 7-0 in a House General Laws Subcommittee.

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Relocation of Call Centers to a Foreign Country

HB 1798 would have required state agencies to ensure that all contracts entered into on and after July 1, 2019, for the performance of state business-related call center and customer service work, provide that such work shall be performed by the contractor entirely within the Commonwealth for the contractor's primary call center and customer service workplace.

The legislation passed the House of Delegates 61-36. However, it was defeated 10-5 in the Senate Commerce and Labor Committee.

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Right to Repair/Deactivation or Alteration of Embedded Software

NVTC opposed HB 1754, which aimed to prohibit the original equipment manufacturer (OEM) of a digital device from deactivating embedded software in the digital device or altering embedded software so as to substantially alter the functioning of the digital device as a response to it being repaired by an independent repair provider or owner.

NVTC believes that if enacted, this legislation would have led to unintended consequences to the operation, security and safety of those products and would have prevented OEM’s from altering embedded software potentially violating federal copyright protections.

The legislation was not heard in the House Science and Technology Committee prior to the General Assembly’s crossover deadline and did not move forward this session.

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Care and Disposal of Customer Records and Cybersecurity for Connected Devices

NVTC opposed HB 2793. This legislation would have required every manufacturer of a device sold in Virginia that is capable of connecting to the Internet to file an annual report with Virginia’s Chief Information Officer (CIO) proving their compliance with whatever current security standards are at the time of the filing. NVTC opposed this legislation as a highly regulatory bill with vague standards and unclear definitions that would have introduced substantial uncertainty and risk for every company that manufactures Internet-capable devices.

HB 2793 was defeated 5-2 in House Commerce and Labor Subcommittee #1.

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Ending Tax Incentives for Solar Projects Greater than 20 Megawatts

NVTC opposed HB 2810 which would have advanced the sunset date of the real property tax exemption for solar projects greater than 20 megawatts from 2024 to 2020.

Access to renewable energy is increasingly critical to Virginia’s statewide economic development efforts and competitiveness. Since 2014, Virginia utility scale solar has grown from 17 MW to more than 4,000 MW online or under development. Last year, Virginia policymakers established a goal of providing 5,000 MW of solar capacity over the next several years. NVTC believes that incentives have been an important factor in developing access to renewable energy across Virginia and that it would have been detrimental to Virginia’s economic development efforts to roll back the incentives as proposed in this legislation.

The legislation was defeated 6-1 in the House Finance Subcommittee #2.

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Net Neutrality

HB 1755 would have prohibited a provider of broadband services from offering or renewing services to consumers within any locality in the Commonwealth in which certain media is throttled, blocked, or prioritized on the basis of its content, format, host address, or source.

The legislation was defeated 7-1 in the House Commerce and Labor Subcommittee #3.

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Regulation of Social Media Websites as Public Service Corporations

NVTC opposed HB 2635 which would have required the State Corporation Commission to regulate any social media website that is open to the public, that has more than 75 million subscribers, and that is not specifically affiliated with any one religion or political party as a public service corporation. The measure also would have prohibited such a website from using an assertion, opinion, or belief that religious or political speech constitutes hate speech as a basis for deleting or censoring a user's religious or political speech.

NVTC believes that, if enacted, this legislation would have proven overly burdensome to businesses operating in Virginia and would have conflicted with the First Amendment.

The bill was heard in the House Commerce and Labor Subcommittee and no motion was made to advance the bill.

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Mandatory Time Tracking Software in State IT Contracts

NVTC opposed HB 2804 which would have required state agencies contracting for professional and IT project services to include provisions in their contracts that would require contractors to install software to allow for the verification of the number of hours worked on a project using a computer.

NVTC believes that if enacted, this legislation would be overly onerous and expensive to IT service providers and also would increase the costs of services to the Commonwealth.

The legislation was defeated 7-1 in the House General Laws Subcommittee #4.

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Workforce Development

SB 1523 and HB 2545 would have created the position of Secretary of Workforce Development, remove the position of Chief Workforce Development Advisor and reassign that position's responsibilities to the newly created secretariat.

SB 1523 passed the Senate of Virginia 34-6. However, both SB 1523 and HB 2545 did not move forward in the House Appropriations Committee.

SB 1589 would have created the Virginia Works Portal, under VEDP to provide one-stop access to information regarding career paths, education, workforce development, and employment opportunities in the Commonwealth. The bill also would have created a five-person Virginia Works Board to oversee the Portal and the Virginia Works Advisory Committee of public and private sector stakeholders to advise the Board.

The legislation passed the Senate of Virginia unanimously. However, both SB 1523 and HB 2545 did not move forward in the House Appropriations Committee.

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Block Chain

HB 1900 would have established the Health Care Provider Credentials Data Solution Fund for the purpose of soliciting proofs of concept to establish or improve a system for the storage and accessing of health care provider credentials data, utilizing blockchain or a similar technology.

The legislation was defeated 5-2 in the House Appropriations Health and Human Resources Subcommittee.

HB 2415 would have created a rebuttable presumption that a business record electronically registered on a blockchain is a self-authenticating document for certain facts. This bill was a recommendation of the Joint Commission on Technology and Science.

The legislation was defeated 7-1 in the House Courts of Justice Subcommittee #3.


Virginia Budget

The General Assembly enacted amendments to the state's biennial budget. Throughout the legislative session, NVTC advocated for budget priorities for Virginia’s technology community. In their updated budget, the General Assembly included:

  • $16 million for the Tech Talent Investment Fund which establishes the state’s higher education commitments to increase computer science degrees to support Amazon’s major new corporate headquarters and meet the need of other technology businesses across the Commonwealth through:
    • Performance-based investments in bachelor’s degree programs in computer science and related fields;
    • Performance-based investments in new master’s degree programs in computer science and related fields at George Mason’s Arlington campus and for Virginia Tech to establish a new Innovation Campus in Alexandria; and
    • Investment in K-12 technology education and internship programming to connect college students to tech jobs.
  • $4 million for FastForward (aka New Economy Workforce Credentials Grant Fund) which aligns community college workforce training programs with the needs of business and industry by targeting credentials in high demand fields (including cybersecurity and other technology areas).
  • $600,000 to support ADVANCE, a George Mason University and Northern Virginia Community College Partnership that guides NOVA students through program pathways to degree completion at Mason. This initiative will work in collaboration with Northern Virginia employers to adapt and create workforce programs to fill the region’s critical high-demand positions.
  • $50.0 million Semiconductor Manufacturing Grant payment to support Micron’s $3 billion expansion in Manassas, which will create 1,100 new jobs.
  • Increased funding for the Virginia Telecommunication Initiative by $15.0 million, ( total of $31 million) to accelerate broadband investment in unserved areas of the Commonwealth.
  • $2.3 million for detailed planning for a Children’s Science Center in Northern Virginia.
  • Invested an additional $1.0 million for the Enterprise Zone grant program to encourage the deployment of solar equipment in economic revitalization areas.
  • $752,541 to conduct a statewide data inventory led by Virginia’s Chief Data Officer.
  • $137,000 to support a position within the Division of Energy to assist localities with siting, procurement, land use concerns, and other solar energy-related issues.
  • The budget maintained full funding to launch the Commonwealth Cyber Initiative (CCI). CCI will serve as an engine for research, innovation, and commercialization of cybersecurity technologies, and to help power Virginia's cyber security workforce by providing more advanced and professional cyber degrees. CyberX will consist of a primary hub, located in Northern Virginia, and a network of spokes across the Commonwealth with collaborating public institutions of higher education in Virginia and industry partners to build an ecosystem of cyber-related research, education, and engagement that positions the Commonwealth as a world leader of cybersecurity. Virginia Tech will serve as the anchoring institution in collaboration with George Mason University, the Northern Virginia Community College and other public higher education institutions in the Commonwealth.

Stay Connected with NVTC's Advocacy Team

NVTC's public policy team welcomes your feedback. Feel free to contact us at any time with questions, ideas or suggestions:

NVTC Vice President of Policy Josh Levi (jlevi@nvtc.org; 703-268-5140)

NVTC Director of Policy Troy Murphy (tmurphy@nvtc.org; 703-268-5135)

For more information about NVTC's advocacy efforts, please visit us online at www.nvtc.org/advocacy.