Newsletter — November 14, 2024 | |
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POLICY
ECONOMY
ON THE LOCAL FRONT
POLITICAL NEWS
RETAIL THEFT & PUBLIC SAFETY
TRENDS
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WR sets 2025 legislative priorities
As the 2025 session approaches, WR’s Government Affairs Team has identified and set key legislative priorities that are most impactful to the retail industry’s ability to thrive in Washington.
Artificial Intelligence: WR will advocate that legislation should be first run through the state’s AI taskforce. Any proposed legislation should only target the most high-risk uses and not impact low-risk retail applications or hinder innovation.
Environmental Regulations: WR supports streamlined federal solutions that simplify compliance and prevent a patchwork of state-level laws.
Public Safety and Organized Retail Crime: ORC remains a priority, with WR focused on theft prevention and enhancing law enforcement resources to protect retailers and communities.
Taxation and Spending: With the projected shortfall to be in the billions, taxation, new revenue, and spending has become a major focus area for the association. WR, alongside the broader business community, will strongly oppose new or increased taxes that place undue strain on retail businesses.
Please note, these are just a few of WR’s identified priorities for the 2025 session. Stay tuned for the full list, set to be published early December.
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JLARC reviews Paid Family and Medical Leave Program
The Joint Legislative Audit and Review Committee (JLARC) recently reviewed the state's Paid Family and Medical Leave (PFML) program, administered by the Employment Security Department (ESD). The program offers paid leave for public and private employees, funded through employer and employee premiums.
JLARC’s preliminary report highlighted ongoing financial challenges, with program costs surpassing revenues. Members discussed key areas for improvement, including ESD’s customer service, employer audits, and measures to prevent overpayments. They also explored the impact of the Social Security cap on rates and the potential benefits of a forward-looking rate-setting approach and a financial reserve. However, these changes would require legislative action.
ESD addressed questions on call center performance, noting issues with high call volumes and long hold times. JLARC’s report recommends that the Legislature adjust the rate-setting formula and that ESD improve program administration to enhance financial sustainability.
The final report, incorporating ESD’s official response, is expected in January 2025.
Why It Matters:
- Stabilizing PFML funding
- Enhancing customer service and program oversight
- Strengthening financial and operational sustainability
WR will continue to advocate for employers’ interests and to keep the current premium share formula to minimize the continuous rising cost of doing business.
Read the report
View the fact sheet
Watch a 90-second video
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Retail sales rebound in October, setting the stage for a strong holiday season
Retail sales surged in October, recovering from a slower September, according to the CNBC/NRF Retail Monitor. Driven by strong job gains and higher wages, October’s rebound positions the retail sector for a robust holiday season, says NRF President and CEO Matthew Shay.
Total retail sales, excluding automobiles and gasoline, rose 0.74% seasonally adjusted from September and were up 4.13% unadjusted year-over-year. Core retail sales, which exclude restaurants, automobiles, and gasoline, saw even stronger growth, increasing 0.83% month-over-month and 4.59% year-over-year.
October’s performance marks the strongest year-over-year gain in total sales since November 2023 and reflects consumer confidence as inflation remains focused on services, with prices for some goods declining. Online sales led the growth, up 19.38% year-over-year, followed by gains in clothing, health and personal care, and general merchandise stores.
Despite challenges like the end of student loan relief and recent port strikes, retail categories broadly benefited. With October’s momentum, the industry anticipates a promising start to the holiday shopping season.
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Inflation increases in October, raising concerns for consumers and the Fed
Inflation in the U.S. rose modestly in October, marking the first increase in seven months, driven by higher rents, used car prices, and airfares. Consumer prices climbed 2.6% from a year earlier, up from 2.4% in September. Core inflation, which excludes volatile food and energy costs, remained steady at 3.3%. While most economists expect inflation to continue slowing, the uptick may signal rising costs at the grocery store and make it harder for the Federal Reserve to reduce interest rates further.
Despite the modest price increases, some costs, like gas and grocery prices, have shown improvement. Gas prices fell by 0.9%, while grocery costs increased only slightly by 0.1%. However, used car prices saw a notable spike of 2.7%, reversing months of decline.
The Federal Reserve remains focused on bringing inflation closer to its 2% target, with many expecting another rate cut in December. But with the economy growing faster than expected and consumers spending freely, future inflation and interest rate trends remain uncertain. Lower inflation expectations may offer consumers some relief as price pressures appear to be cooling.
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King County Executive Dow Constantine announces he will not seek reelection in 2025
King County Executive Dow Constantine, who has served since 2009, announced Tuesday evening that he will not seek reelection to a fifth term in 2025.
Reflecting on his 15 years in office, Constantine expressed his commitment to building a more just and thriving community for all King County residents. During his tenure, he focused on expanding access to opportunity, addressing systemic injustices, and advancing policies related to transit, climate, and housing. A Seattle native and fourth-generation Washingtonian, Constantine also served in the state House and Senate before his time as county executive.
As he prepares to step down, Constantine emphasized the importance of continued progress, particularly in behavioral health and housing. "King County must stay the course of progress," he stated, affirming his ongoing dedication to the region even after leaving office. Constantine's leadership has helped shape a better future for King County, and he leaves a lasting legacy of commitment to equity and community development.
Constantine’s departure will also impact Sound Transit after 2025. He is currently the chair of the regional transit agency’s board.
The competition to succeed Constantine has already begun. County Councilmember Claudia Balducci has announced her candidacy for Executive and her colleague, Councilmember Girmay Zahilay has stated that he is “strongly considering” entering the race.
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Ballots still being counted – Election certification December 5
Several thousand ballots are still to be counted before the election can be officially certified on December 5 by the Secretary of State. Movement has been seen in several close races. While most outcomes are already decided, the victors are preparing to govern.
- In the U.S. Senate, Maria Cantwell has secured another six years in office.
- In U.S. Congress, Washington will welcome former State Senator Mike Baumgartner to the 5th District (Spokane area).
- Current State Senator Emily Randall will be welcomed to the 6th District (Gig Harbor, Port Orchard, and surrounding areas).
- There were no other changes in the remaining eight Congressional seats.
For Statewide elections:
- Current Attorney General Bob Ferguson won the governor’s race and has already begun assembling his team.
- Nick Brown, former U.S. Attorney, will take his place as Attorney General.
- Steve Hobbs will remain as Secretary of State.
- Lt. Governor Denny Heck earned another four years in office.
- State Senator Patty Kuderer will be the new Insurance. Commissioner, replacing the retiring Mike Kreidler.
- Dave Upthegrove, current King County Councilmember and former State Legislator, will become the new Lands Commissioner.
- Chris Reykdal will remain as Superintendent of Public Instruction.
- Pat McCarthy will continue as Auditor.
- Mike Pellicciotti will serve another term as Treasurer.
In the Legislature, Democrats are likely to gain one seat in both the House and Senate.
- In the open 26th District House race (Gig Harbor/Port Orchard), former State Rep. Jesse Young is trailing former House candidate Adison Richards.
- In the open 18th District Senate race (Vancouver), former candidate Adrian Cortes is leading political newcomer Brad Benton by just 264 votes.
Both sides are currently working to “cure” ballots, meaning they are helping voters whose ballots were not initially counted (for reasons such as missing signatures or mismatched names) correct any issues so their votes can be counted. In close races, these efforts can be the deciding factor between winning and losing.
Regardless of the final results, WR, its members, and its staff extend congratulations to all newly elected and returning officials. We look forward to working collaboratively with you to preserve and improve the retail industry for our customers, employees, and business owners.
Thank you to all the voters who participated in this important and historic election.
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Let’s Go Washington marks milestone on energy choice initiative
Let’s Go Washington (LGW) has announced the passage of Initiative 2066, which secures natural gas and energy choice for Washington State. The measure, backed by 533,005 signatures, reflects strong public opposition to legislation aimed at phasing out natural gas.
WR supported I-2066, emphasizing its importance for protecting business energy options and controlling costs.
The initiative was spurred by HB 1589, a law allowing Puget Sound Energy to limit natural gas service and require costly retrofits to electric systems. LGW’s campaign highlighted the potential financial impact, with retrofitting costs estimated between $40,000 and $70,000 per home or business.
Support for I-2066 united over 450 small businesses, including breweries, bakeries, and culturally diverse restaurants reliant on natural gas. The coalition emphasized that natural gas remains a crucial, reliable, and affordable energy source for many residents, particularly in rural areas facing severe winters.
For more information, visit letsgowashington.com.
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Washington State’s incoming administration declares support for the ORC Task Force
During the November 7 Washington State Organized Retail Crime Task Force meeting both Governor-Elect Bob Ferguson and Attorney General-Elect Nick Brown made an appearance to express strong support for the Attorney General's ORC Task Force. The unit, established in 2023 to address the rising threat of organized retail crime, has become a vital resource to prosecute large-scale ORC rings.
With ORC incidents increasing nationwide, Ferguson and Brown’s commitment to the Task Force signals a continued focus on protecting Washington’s retail businesses and communities. Both leaders have emphasized the importance of tackling retail crime through collaborative, multi-agency initiatives that can respond swiftly to complex theft networks and provide essential resources to local law enforcement.
WR looks forward to working with the incoming administration to improve public safety and combat ORC across Washington.
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Ulta Beauty transforms supply chain with market fulfillment centers
Ulta Beauty is revolutionizing its supply chain with a shift to a Market Fulfillment Center (MFC) model, blending efficiency and adaptability. Unlike competitors that rely on large, capital-intensive facilities, Ulta is opting for a smaller, nimble network. The model includes four regional distribution centers, three market fulfillment centers, and a “fast” fulfillment center, said Erik Lopez, Chief Supply Chain Officer.
The MFC model accelerates fulfillment, keeps inventory centralized, and requires less capital investment. “It’s faster to build and gets closer [to customers],” Lopez explained.
To optimize this strategy, Ulta is retrofitting existing distribution centers with advanced automation. Following upgrades to its Greenwood, Indiana, facility, similar improvements are underway at its Dallas center, set for completion in 2025. These upgrades include warehouse execution software, which acts as the “brains” of the operation, streamlining workflows and enhancing efficiency.
The retrofits also aim to empower employees by reducing repetitive tasks and offering skill development opportunities. “We’re focusing on reducing steps and waste while being less labor-intensive,” Lopez said.
Ulta’s thoughtful approach positions the retailer to meet growing customer demands while fostering innovation within its workforce.
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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, Dir of Local & State Government Affairs — 360.200-6453 — Email
Rose Gundersen, VP of Operations & Retail Services — 360.200.6452 — Email
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