North Carolina small businesses need a clean repeal of HB 2

This post originally appeared on Huffington Post and was authored by John Arensmeyer Founder & CEO of Small Business Majority

Across the Tar Heel State, small businesses brighten up main streets, drive innovation and provide a paycheck to nearly half of the private sector workforce. In a state that’s known as a research and innovation hub and a basketball powerhouse, entrepreneurs depend on a steady stream of tourists, loyal customers and talented employees to keep their businesses thriving. That’s why the fallout over HB 2, the state’s anti-LGBT law, has been particularly harmful to small firms. While the state legislature passed a replacement measure for HB 2 last week, many entrepreneurs are concerned the new law is just as discriminatory and won’t be enough to bring business back to the state.

The NCAA indicated this week it will “reluctantly” lift its ban on holding championship events in North Carolina after reviewing the new HB 2 replacement measure, but others have said the new law is just as bad as the old one. Mayors from major cities around the country have said they will continue to ban city-sponsored travel to the state. And major corporations like Levi Strauss have spoken out against the measure.

At issue is the fact that the so-called compromise legislation leaves in place key aspects of the original law, including a provision that prevents municipalities from enacting local non-discrimination protections for LGBT people until 2020. This provision is harmful, and is out of touch with what small business owners really want.

Stan Kimer, a small business owner in Raleigh who consults other businesses on diversity and inclusion practices knows all too well how the replacement measure will continue to harm the state’s reputation and economy.

“The updated law was a very small first step, but it still sends a message that we are not an inclusive, welcoming business environment,” said Kimer. “North Carolina is one of more than 20 states that does not provide discrimination protections for LGBT people, and we are now also only one of three states that prohibits cities and counties from adding protections of their own.”

Kimer is also concerned about the financial consequences of the legislature’s failure to fully repeal HB 2.

“This will continue to harm our economy. It is often the large cities with high-tech and research industries that are trying to recruit top new talent, and these prospects often value diversity and inclusion. Preventing cities like Charlotte and Raleigh from promoting an inclusive business environment can truly hinder employee recruiting and retention efforts, which will have a ripple effect on local economies.”

There’s no doubt the economic consequences of HB 2 have been harsh and destructive. A report from UCLA estimated the law would cost the state up to $5 billion a year. Many are well aware of the high-profile boycotts of the state—from PayPal canceling the creation of 400 new jobs, to entertainers canceling concerts to the NBA moving the 2017 All-Star game from Charlotte to New Orleans. Last year it was estimated the city of Charlotte alone lost a whopping $285 million, with a projection to lose an additional $86 million in canceled events.

As these numbers show, discrimination is bad for business. And entrepreneurs understand this better than anyone. Small Business Majority’s scientific opinion pollingfound more than two-thirds of small business owners in North Carolina believe the state should have a law protecting LGBT individuals against employment discrimination. Additional polling found an overwhelming 8 in 10 entrepreneurs nationwide support protecting LGBT individuals against discrimination in public accommodations, such as restaurants, hotels and other businesses that are open to the public.

If lawmakers are serious about preventing more damage to the state’s economy and small businesses, they need to step up and end discrimination in the state once and for all. That is the only way to show North Carolina is truly open for business for everyone.