Friday, May 1, 2009

News from Ranking Member Sam Graves and Committee Republicans:

• Roll Call: Ranking Member Graves is tapped to help lead Rural America “solutions group”
• Rep. Luetkemeyer’s “Expanding Entrepreneurship Act of 2009 Gains Momentum”
• Rep. Thompson: “Cap and Tax will Devastate Small Businesses, Family Farms”

Must-Reads from the Week:
• The Washington Post: Small Businesses Brace for Tax Battle
• Business Week: House Passes Credit Card Reform, But Leaves Out Small Business Cards

Administration and the SBA:
• President Obama celebrated his first 100 days in office this week and although he continues to be popular among Americans his efforts on behalf of small businesses has been met with mixed reviews.  According to a Small Business and Entrepreneurship Council press release, “President Barack Obama's "first 100 days" have been lacking in constructive policy initiatives for entrepreneurs and small businesses and small businesses are largely dismayed by the Administration's focus on big business and labor unions while small business gets policy scraps at best.”  The release continues, “the general direction of the Administration's policy initiatives - from increased taxes, to a costly cap-and-trade program, massive government spending, mixed messages on the global trade front and support for big labor's prime policy objectives (like "card-check") - signal new cost burdens and uncertainties that will disproportionately fall on small business owners.  And, while small business owners need more affordable access to health coverage, it appears that punting the issue to Congress is producing a plan that could impose new mandates and costs that small firms cannot afford.”    

• This morning the Small Business Administration announced plans to make more small businesses eligible for their flagship 7(a) loan program.  The change in eligibility will improve a small firm’s ability to acquire capital during these tough economic times.  According the SBA’s press release, “SBA’s alternate size standard for its 7(a) loan program will go into effect early next week through Sept. 30, 2010. As a result of the temporary change, more than 70,000 additional small businesses – including auto and RV dealerships, auto industry suppliers and others – could be eligible to apply for SBA 7(a) loan.

 Review of House Activity:
• The House this week passed the $3.6 trillion Budget Conference Report without a single Republican supporting the measure.  This non-binding resolution sets the frame work for decisions on taxes, appropriations and entitlement programs later in the year.  Republicans remain concerned over the huge expansion of government and the dangerous levels to which this framework pushes the nation’s debt.

• The Credit Cardholder’s Bill of Rights passed the House on Thursday by a margin of 357-70.  Among other things, this legislation prohibits a creditor, with some exceptions,  from increasing any annual percentage rates (APR) on the existing balance of a credit card, requires written notification for increasing an APR, and prohibits double-billing or charges on preceding billing cycles.  Republicans offered a motion to recommit that prohibits the underlying bill from taking effect until the Federal Reserve Board of Governors determines that none of the provisions in the legislation will reduce the availability of credit to small businesses.  Unfortunately, this motion failed 164-263. 

Legislation and Letters Circulating Around the House:
(If you would like to publicize your small business effort in Congress, please email Paul J. Sass at Paul.Sass@mail.house.gov)

• Rep. Duncan Seeks Co-sponsors for Limitation on Government Spending Act of 2009-  Rep. John Duncan is seeking co-sponsors for the Limitation on Government Spending Act, which is identical to S. 897 introduced by Senator Hatch.  The legislation will limit Federal spending to 22% of the GDP in FY2011, 21% of the GDP in FY2012, and to 20% of the GDP in FY2013 and fiscal years thereafter.  The bill also includes a point of order in both the House and Senate for any legislation that would result in exceeding the Federal spending limit for that fiscal year.  If you have any questions regarding this legislation or if you would like to become a co-sponsor, please contact David Black in Congressman Duncan’s office at 5-5435 or David.Black@mail.house.gov.

• Rep. Chaffetz seeks original cosponsors for Cap-and-Trade Tax Disclosure Act- Rep. Jason Chaffetz is seeking original cosponsors for the Cap-and-Trade Tax Disclosure Act which will require utility companies to disclose and separately itemize the impact of cap-and-trade taxes on each customer’s utility bill. Sound tax policy requires that taxes should be visible to taxpayers and not buried in the cost of items we purchase. With this legislation, every utility customer – residential and business -- will be able to identify the cost of cap-and-trade emissions that the utility is passing on to the customer. As regulated entities, utilities pass taxes on to customers, unlike unregulated companies that can also pass taxes on to shareholders and employees. The cap-and-trade tax is potentially the largest tax increase ever imposed. According to the Administration’s own budget document, the cost will be at least $646 billion over an eight-year period. No matter where you stand on the issue of cap and trade, both sides can agree that full disclosure and transparency are good public policy. If you have any questions regarding this legislation or if you would like to become an original cosponsor, please contact Mike Jerman in Congressman Chaffetz’ office at mike.jerman@mail.house.gov.

Review of Senate Activity:
• The Senate Tuesday overwhelmingly passed bipartisan legislation to bolster existing tools and increase resources available to federal prosecutors to combat fraud.  The Fraud Enforcement and Recovery Act (FERA) will help both to protect Americans from fraud and recover taxpayers' money lost to fraud.  Senator Chuck Grassley (R-Iowa), co-author of the legislation said, "Taxpayers have been asked to shoulder an enormous burden. We simply cannot allow these funds to be unprotected from fraud, waste, or abuse. By strengthening and updating provisions to help our federal law enforcement go after the bad actors, we're deterring potential defrauders from attempting to scam the government, and helping instill confidence back into the housing and financial markets." 

• The Senate this week also passed the $3.6 trillion Budget Conference Report without a single Republican supporting the measure.

House Small Business Committee hearing summary this week:
• This week the House Committee on Small Business held a hearing entitled “Climate Change Solutions for Small Businesses and Family Farmers.”  The hearing focused on draft climate change legislation and its impact on small businesses.  Hearing participants highlighted some opportunities that would become available to small businesses by way of climate change legislation, but also expressed concerns over the costly burdens that would be associated with the measure.  Hearing participants included the following:

• Mr. Fred Yoder, Past President, National Corn Growers Association
• Mr. Robert McNamara, President, F.J.A. Christiansen Roofing Co., Inc. on behalf of the National Roofing Contractors Association
• Mr. Roger Johnson, President, National Farmers Union
• Mr. Gordon P. Sharp, Chairman, Aircuity, Inc.
• Mr. Lawrence W. Kavanagh, Vice President, Environment & Technology, American Iron and Steel Institute

Ranking Member Graves questioned how proposed climate change legislation could impact the economy and small businesses.  In summary, hearing participants responded that input costs will rise, jobs will go overseas, energy bills will be higher, and the overall cost of business and goods will go up.  Mr. McNamara, representing the National Roofing and Contractors Association, mentioned how roofers use energy intensive materials and a cap-and-trade program could adversely impact the price-sensitive roofing industry by substantially raising input prices.  Mr. Kavanagh, with the American Iron and Steel Institute, explained that “energy costs are 20% or more of the cost of making steel.  It is therefore unmistakably clear that a sharp increase in total energy cost will affect our competitive position in the global marketplace.” 

For more information on this hearing, please contact Paul Sass with the House Committee on Small Business Republican office, at (202) 225-5821.

Other Small Business off the Hill:
• The NFIB released its Small Business Economic Trends for April.

• The Associated General Contractors released a statement pointing to a recent EPA report showing the construction industry accounts for less than one percent of annual green house gas emissions.
 
Looking Forward:

House Small Business Committee hearings next week:
• Full Committee Hearing, May 6, 2009, 1:00PM entitled, “Legislation to Reauthorize and Modernize SBA’s Entrepreneurial Development Programs,” 2360 Rayburn House Office Building
• Subcommittee on Finance and Tax Hearing, May 7, 2009, 10:00AM, entitled, “How the Complexity of the Tax Code Hinders Small Businesses,”  2360 Rayburn House Office Building