Get Connected
Subscribe to our e-newsetter and get the latest information delivered straight to your inbox.
Straight Talk E-News
Small Biz Straight Talk (7/17/09)
Washington,
July 17, 2009
Friday, July 17, 2009 News from Ranking Member Sam Graves and Committee Republicans: • Ranking Member Sam Graves in St. Joe News Press: “Local voices debate health care legislation” Administration and the SBA: • Small business lender CIT Group announced on Wednesday that the Obama Administration would not be providing immediate government aid to help them with their financial situation. This decision leaves them with very few options to avoid bankruptcy. Some worried that this could have a ripple effect on the economy considering the role CIT Group played in helping small businesses with financing. Republicans expressed concerns with the Obama Administration favoring “too big to fail” companies over those that play an important role for small businesses and highlighted President Obama’s tendency to ignore small businesses when they are in need. • OMB Director Peter Orszag advised federal agency officials that the Federal Acquisition Regulation Council is expected to implement President Obama's Executive Order 13502 “without delay” to repeal a previous executive order that had prohibited agencies from requiring Project Labor Agreements (PLA). According to the Independent Electrical Contractors Association, the proposed rule would increase the costs of federal contracts by narrowing competition if contractors and subcontractors are discouraged from bidding because of PLA terms. According to an association release, “Small businesses and their employees should not be forced to sign a contract with a labor union in order to work on a project that is funded with their own tax dollars. Such a discriminatory policy is without justification and denies job opportunities to the vast majority of our industry.” “Both the administration and the Congress have consistently advocated for more small business access to federal contracts, Executive Order 13502 would deny opportunities to numerous subcontractors who refused to bid on the work that stipulates compliance with a project labor agreement. Further, 84 percent of the construction workforce chooses not to be represented by a labor union.” • The Obama Administration came out in strong opposition of a House plan that would force General Motors and Chrysler to restore agreements with dealerships shed during the automakers’ bankruptcy proceedings as a condition of receiving federal aid. Language was attached to the FY10 Financial Services Appropriations bill that passed the House on Thursday by a vote of 219-208. “The decision by Chrysler and GM to rationalize their dealer networks was a critical part of their overall restructuring to achieve long-term viability,” the administration said in a statement. House Minority Leader John Boehner said, “These people paid serious money for these dealerships, they’ve got a big investment there in real estate, and all of a sudden they’re out of business. I think a lot of these auto dealers have been treated unfairly.” Review of House Activity: • This week, the House continued to push through appropriations bills. Earlier in the year Speaker Nancy Pelosi set a goal to pass all spending bills by the August recess. In an attempt to do so, Democrats have restricted debate on a traditionally open process and Republicans expressed strong concerns on the House Floor. After the dust settled, the House was able to pass a Financial Services Appropriations bill on Thursday and the Energy and Water appropriations bill today. For more information on these and other appropriations bills, please visit the appropriations committee website. Review of Senate Activity: • The Senate this week concluded deliberations on the nomination of Judge Sonia Sotomayor to the Supreme Court. A Senate floor vote on her confirmation is expected in August. House Small Business Committee hearing summary this week: • On Wednesday, July 15, 2009, the House Committee on Small Business held a hearing entitled, “Economic Recovery: Tax Stimulus Items that Benefitted Small Business with a Look Ahead.” Witnesses included Stan Johnson, Stan’s Heating and Air Conditioning, Arlington, VA, on behalf of the Air Conditioning Contractors of America; Charles McMillan, President, National Association of Realtors, Dallas, TX; R. Michael Menzies, President and CEO, Easton Bank & Trust, Easton, MD, on behalf of the Independent Community Bankers of America; Douglas Woods, President, The Association for Manufacturing Technology, McLean, VA; Rea Hederman, Jr., Senior Policy Analyst and Assistant Director, Center for Data Analysis, The Heritage Foundation. The hearing reviewed the stimulus tax provisions, what seems to be working and what isn’t, and heard suggestions for further action. The witnesses testified that some of the tax provisions included in the American Recovery and Reinvestment Act (P.L. 111-5), or “stimulus,” have helped small firms through the current economic climate. But because of the narrow applicability and temporary effectiveness of those provisions, they simply skirt the edges of economic recovery. According to Mr. Hederman, real economic recovery requires pro-growth policies, such as broad marginal tax rate reduction for all taxpayers. In addition, he said, the 2001 and 2003 tax relief should be made permanent. Ranking Member Graves introduced legislation, H.R. 664, the Economic Stimulus Enhancement and Tax Relief Permanency Act, to give small firms the tax code predictability they need to make investments and hire more workers. Ranking Member Graves said, “President Obama and Speaker Pelosi promised that their $800 billion stimulus would create jobs. But in June, unemployment rose to 9.5%, the highest level in nearly three decades. It is clear that the “stimulus” isn’t working. Now Speaker Pelosi wants small businesses to pick up the tab for health care.” When asked about tax increases to pay for more government spending and health care reform, the witnesses said tax hikes would be devastating to their businesses. Mr. Johnson said, “In February we had a national meeting in Fort Worth, Texas that focused on health care, and we voted with 500 people in the room. Sixty to seventy percent of our membership was in support of what President Obama had on the table at that time. That support has evaporated. You are taking too much money.” • This week the Subcommittee on Investigations and Oversight conducted a hearing on the draft highway reauthorization bill and how it will impact small businesses. Members from the Associated General Contractors, Associated Equipment Distributors, American Institute of Architects, National Stone, Sand and Gravel Association, American Traffic Safety Services Association, and the American Road and Transportation Builders Association all participated. Hearing participants highlighted how the nation’s infrastructure is vital to the economy and small business. The maintenance and expansion of transportation infrastructure is critical for small businesses to deliver their goods to the consumer, but also to the small businesses that contribute to infrastructure construction and maintenance. However, with increasing users and rising costs of maintenance, highways are suffering. Subcommittee Ranking Member Mary Fallin said, “Our country’s infrastructure is critical to this economy and improvements are desperately needed. I believe that small businesses will benefit from efficient infrastructure spending. However, we must be careful about how we move forward. Raising taxes to pay for this bill in a time when gas prices and unemployment are rising will be counterproductive.” Suggestions from the hearing participants varied, but it became clear that a long term reauthorization is needed to help small businesses plan for the future. Thomas Kirchoff with the Associated Equipment Distributors said, “A multi-year highway bill with increased investment is needed to give contractors and the dealers the long-range view to be able to plan accordingly and invest in the future.” Other Small Business off the Hill: • A study by the Tax Foundation examines the tax increases that would pay for health care reform. Looking Forward:
|