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Small Biz Straight Talk (7/10/09)
Washington,
July 10, 2009
Friday, July 10, 2009 News from Ranking Member Sam Graves and Committee Republicans: • Ranking Member Graves and Rep. Aaron Schock in St. Joe News Press: “House passes small-business bill” Must-Reads from the Week: Administration and the SBA: Review of House Activity: • On Wednesday, the House passed H.R. 2965, the “Enhancing Small Business Research and Innovation Act of 2009,” by a vote of 386-41. The legislation reauthorizes the Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) program’s eligibility requirements. Among other things, H.R. 2965 increases the size of SBIR grants from $100,000 to $250,000 for Phase I, and from $750,000 to $2,000,000 for Phase II awards; increases information flow between program participants and federal agencies; and requires federal agencies to collect more and better information so Congress can better gauge the progress of the program’s improvement. Perhaps the most important change the bill makes deals with the level of venture capital involvement with small businesses that use the programs. The bill reverses a 2003 Small Business Administration decision to limit participation to businesses with less that 50% ownership by a venture capital firm, thereby increasing the number of small businesses that qualify for the programs.
• On Thursday, the House passed H.R. 2997, the “Agriculture, Rural Development Food and Drug Administration and Related Agencies Appropriations Act of 2010,” by a vote of 266-160. House Republicans were outraged by the limitation of amendments made in order for consideration during floor debate. H.R. 2997 provides an 11.9% increase above the FY 09 funding level. Also on Thursday, the House passed H.R. 3081, the “Department of State, Foreign Operations, and Related Programs Appropriations Act, 2010,” by a vote of 318-106. H.R. 3081 provides a 33% increase above the FY 09 funding level. • On Friday, the House considered H.R. 3082, the “Military Construction and Veterans Affairs Appropriations Act of 2010.” H.R. 3082 provides a 7% increase above the FY 09 funding level. *At the time of publication, deliberation on H.R. 3082 was ongoing on the House floor. Legislation and Letters Circulating Around the House: • Rep. Pete Olson (R-TX) recently discovered that the Obama Administration has specifically removed “job creation” as a criterion for funding projects under at least one stimulus-funded program -- the Department of Energy Smart Grid program, which received $4 billion in the stimulus. Rep. Olson sent a letter to Vice President Biden (who announced the funding in April, promising that it would “create good jobs that will drive our economic recovery”) to explain why job creation was quietly removed as a criteria for participating in this program and replaced with a simple reporting requirement. If you have questions or would like to cosign, please contact J. T. Jezierski at 6-4187 or jt.jezierski@mail.house.gov by noon Thursday, July 9. Review of Senate Activity: • On Thursday, the Senate Committee on Small Business and Entrepreneurship held a roundtable entitled “Healthcare Reform: The Concerns and Priorities from the Perspective of Small Businesses.” According to the Chairwoman’s opening statement, increased health care costs are the number one issue for small businesses. The Committee received input from a diverse group of witnesses. House Small Business Committee hearing summary this week: • On July 8, 2009, the House Committee on Small Business held a hearing entitled, “The Looming Challenge for Small Medical Practices: The Projected Physician Shortage and How Health Care Reforms Can Address the Problem.” The Committee heard testimony on how physician shortages will affect small group and solo medical practices. Witnesses included Robert Harbaugh, M.D., Professor and Chair, Department of Neurosurgery, Penn State University, Hershey, PA; George Sheldon, M.D., Professor of Surgery and Social Medicine, University of North Carolina at Chapel Hill, Chapel Hill, NC; Lori Heim, M.D., President-elect, American Academy of Family Physicians, Laurinburg, NC; Carlo DiMarco, D.O., President, American Osteopathic Association, Erie, PA; and Bruce Kauk, M.D., Northland Internal Medicine, Gladstone, MO. Witnesses spoke about comprehensive health care reform, the reasons for the shortage of physicians, and possible solutions. Numerous studies have shown that there is a growing shortage of physicians, nurses, and other health care professionals in primary care fields such as family medicine, primary care, and pediatrics. A 2008 University of Missouri study found that the U.S. could face a shortage of up to 44,000 family physicians, general internists and general pediatricians in the next 20 years. These physician shortages are affecting populations such as the elderly and underserved. At a time when primary care physicians are in demand, the entire primary care system may be on the verge of collapse. Many primary care and family care physicians run solo or small group practices – small businesses. As Bruce Kauk from Northland Internal Medicine in Gladstone, MO, testified, “Most physicians traditionally have been small businessmen…We employ 4-5 people per practice, pay taxes, and insurance for those people. We all agree that there is a shortage in all of medicine, particularly in primary care.” Ranking Member Sam Graves (R-MO) cautioned against including employer mandates in health care reform, saying, “I strongly oppose employer mandates and a government-run health system. These alternatives could cause as many as 120 million Americans to lose their current coverage, drive insurance companies out of the market, and require substantial tax increases on the small businesses we are depending on to create jobs. I hope that Congress will not pass a bill that hurts the small firms that are already struggling to make ends meet.” This was another in a series of health care hearings as several House Committees begin to consider comprehensive health care reform legislation. • This week, the Subcommittee on Contracting and Technology held a hearing titled: “Helping Small Business Innovators Through the Research and Experimentation Tax Each of the witnesses commented on the important role that the R&D tax credit plays in the growth of small business innovation in the United States. The tax credit encourages small technology-based businesses to invest resources in the research, development, and testing of products and services, all of which promotes job creation. The witness also made several recommendations to strengthen and improve the R&D credit. Foremost among those suggestions is to make the R&D credit permanent. The credit has been renewed a total of 13 times since its inception in 1981, but has never been a permanent fixture in the Internal Revenue Code. Additionally, several of the witnesses commented on the difficulty of navigating the regulations associated with the credit. For many small businesses, it can be a daunting task to wade through the red tape because they do not have lawyers and accountants on their payroll. Often times, many small businesses decide it is simply is not worth the effort or even economically feasible to explore qualifying for the credit. Both Chairman Nye and Ranking Member Schock expressed support for improving and strengthening the R&D tax credit and making it permanent. Other Small Business off the Hill: • The New York Times questions, “Who is the Small Business Majority?” Looking Forward: |