Big issues for small business Featured

9:37am EDT July 22, 2002

Listen to the 2000 presidential campaign rhetoric and you might start to think that business issues aren't causing much of a stir in Washington.

The debate is dominated by talk about social issues, mostly education, preserving Social Security and trying to figure out what to do with all the cash that's pouring into the federal coffers. There's lots of talk about money, it seems, but not a whole lot of discussion about business and what it needs, wants or ought to be getting. That's because business isn't the battleground where the presidential election is going to be decided.

"They're fighting for the 20 percent in the middle," says Jon Delano, a local political analyst and managing partner of law firm Meyer Darragh Buckler Bebeneck & Eck. That fifth of the electorate comprises mostly women whose concerns revolve not around the interests of business, but around issues close to them, like education and working family concerns.

"Business issues don't play with that swing group," Delano says.

But a lack of high-profile public discussion of some of business's concerns belies the amount of proposed legislation concerning business that is circulating through Congress. A number of key issues have worked their way into various stages of legislative action in the U.S. House and Senate, and, since few issues of gravity exist in a vacuum, several are closely related to the ones enjoying heavy play on the campaign trail.

SMC Business Councils, a locally based business organization with at least 5,000 members, has compiled a report that focuses on key issues of interest to business. In May, SMC sent a delegation to Washington to meet with legislators to discuss its concerns and hear what the lawmakers had to say.

Here, according to SMC, are some of the issues business owners ought to be watching:

Social Security. SMC says that all of the jawboning by politicians about reforming Social Security clouds the real issues. The solution to fixing the government program is to make it easier for employers to set up pension plans and more attractive for employees to participate in them.

Health care access. This is a huge problem for small business, which has seen double-digit increases in cost over the last three years and has no reason to expect any relief. SMC opines that legal liability for employers would curtail employment-based coverage almost immediately, and new federal mandates would block access. SMC recommends immediate and total deductibility of health care expenses for the self-employed and encourages collaboration between health care purchasers and providers.

Family medical leave. There are ongoing efforts to put businesses with as few as 24 workers under the Family Medical Leave Act. SMC says that most problems with the FMLA have been in companies with 50 to 100 employees and concludes that extending it to smaller employers will create more widespread woes. Additionally, one legislative proposal would force businesses to provide paid leave, paying for it out of state unemployment compensation funds.

OSHA. The Occupational Safety and Health Administration is considering final rules in safety and health programs, ergonomics and record keeping that would impose increased burdens on small businesses. SMC supports pending federal legislation that would allow businesses to forego OSHA inspections if third-party audits disclose no workplace health or safety threats.

Estate tax reform. The so-called "death tax," a levy that can take as much as 55 percent of the value of a small business from its heirs, has gotten a considerable amount of attention in the current campaign. SMC says the Federal Estate and Gift Tax "combines these two unpleasant certainties into one onerous liability for small businesses."

SMC advocates the repeal of the tax, asserting that it contributes to the demise of the 70 percent of small businesses that do not survive through the second generation and the 85 percent that are not passed on to a third. But as punitive as it is for small businesses, the tax accounts for less than 1 percent of annual federal revenue.

>Additionally, there is legislation pending or proposed concerning bankruptcy reform, job training and tort reform, and SMC is supporting changes to simplify the federal tax code, and increase funding for the Small Business Administration's Office of Advocacy. How to reach: SMC at www.smc.org or (412) 371-1500

Ray Marano (rmarano@sbnnet.com) is associate editor of SBN.