NFDA Key Federal Issues Update
|
NFDA KEY FEDERAL ISSUES UPDATE November 2009 INTRODUCTION The 111th Congress is aggressively addressing President Obama’s activist legislative agenda. While concern for the economy remains high, it has taken a backseat to health care reform, the deficit/budget, a total revamping of our energy policy and most recently the War in Afghanistan. With public and political support rapidly eroding for all of these proposals and concern for the skyrocketing federal deficit and potential for increased taxes to pay for it all rising, the prospects for passage of any of these initiatives is becoming harder politically especially with the 2010 Congressional elections looming on the horizon and the results of the recent elections in Virginia and New Jersey fresh in the minds of all members of Congress in conservative leaning Districts. As always, NFDA will be extremely active in all these arenas protecting and advancing the interest of funeral service and small business. 1.LEGISLATIVE ISSUES. Estate Tax (H.R. 3905). Given all the major issues on their plate, any movement by Congress on the estate tax issue has been deferred until later this year. While freezing the current exclusion and rates (with indexing) still appears alive, Congress is considering extending the 2009 exclusion and rate through 2010 then in 2011 have it return at the 2001 levels as a means to deal with the rapidly escalating federal deficits. However, there is a new development on this issue with the recent introduction of H.R. 3905 as a compromise. The bill, sponsored by Rep. Berkley (D-NV), would maintain the current estate tax exclusion and rate through 2010, then increases the exclusion to $5million and reduces the rate to 35% both over a 10-year period. NFDA and the Family Business Estate Tax Coalition strongly support H.R. 3905 and will actively advocate for its passage and ultimate signing into law. NFDA members can send an e-mail to their members of Congress via Congress-at-a-click at www.nfda.org. urging them to support H.R. 3905. Health Care Reform (H.R. 3962/No Senate bill yet). Late on November 2, House Republicans released an alternative health care reform bill. Republican’s report their bill will lower costs and increase access, without raising taxes, cutting Medicare benefits, adding to the nation debt, interfering with the doctor - patient relationship, or involving a government takeover. Other key provisions of the bill include • Insurance reforms - high risk pooling, availability, no lifetime caps, and preventing unjust cancellations. • Association health care plans • Interstate purchasing of health insurance • Improved HSAs • Medical liability reform Earlier that day, the House Democratic Leadership filed their manager’s amendment to HR 3962 “Affordable Healthcare for America Act”. Speaker Pelosi has promised 72 hours to review the bill, so floor consideration could start on Saturday, with final passage by Veterans’ Day (November 11th). Reports indicate that Pelosi will not allow any Democratic amendments and only 1 Republican amendment (their substitute bill). In the Senate, reports indicate that Majority Leader Reid is having difficulty obtaining the 60 votes necessary to evoke cloture on the final passage of the bill. Progressive Democrats are concerned with the excise tax on “Cadillac” insurance plans and lack of employer mandate. Moderate Democrats are concerned with the public insurance option. As a result the timetable for Senate consideration is slipping. Senator Reid is now suggesting that the Senate may start debate in December. If this is the case, it will be very difficult for House and Senate Democrats to finish the bill by the President’s deadline of the State of the Union address. As you know, NFDA is a member of The Small Business Coalition for Affordable Healthcare which opposes H.R. 3962 because it fails to reduce the growth in healthcare costs and health insurance and threatens to hamper the economic recovery. As part of NFDA’s efforts to ensure affordable health care for our members, we have signed onto a coalitional letter that will be distributing today that opposes the “Affordable Healthcare for America Act” (H.R. 3962). Particularly egregious provisions in the Democratic bill include: Employer mandate tied to a punitive “pay-or-play”: H.R. 3962 combines an employer mandate with a “pay-or-play” tax. Aside from the overly prescriptive tests an employer who provides coverage must meet, the payroll tax penalties threaten both those who do and do not provide coverage. Economic research has shown time and again that mandates are a “one-two punch” that is first borne by the employer, but is ultimately borne by the employee – through job loss and lower wages. ü Surtax: Seventy-five (75) percent of small businesses are structured as pass through entities and pay their business taxes at the individual level. More than one-third of small businesses employing 20 to 250 employees would face the tax. Finally, since the tax is not indexed for inflation, the effect of the tax will creep downward, making more and more businesses vulnerable to a tax increase. ü Public Option: A government-run plan cannot compete fairly with the private market, and ultimately is funded on the backs of small businesses. We believe that with proper reforms, the private market can be held accountable to provide greater competition and lower-cost solutions for small businesses and their employees. ü Takes Working Solutions off the Table: Small employers need more, not fewer, affordable health insurance options. However, the prohibition of HSA, FSA and MSA funds to purchase over-the-counter medications, along with the $2,500 limit on FSA contributions, threatens to further limit the ever-shrinking options employers have to provide meaningful healthcare to their employees. ü Big Benefit Package and More Mandates: Small employers typically pay 18 percent more for their healthcare. Small employers need a guarantee that plans offered in an exchange will be less costly, not more expensive, than what they are paying today. The benefit packages in H.R. 3962 are far more “benefit rich” than plans offered in today’s marketplace and also require some small employers to provide additional benefits that go beyond the scope of current federal law. ü Big Price Tag for the Government = A Bigger Bill for Small Business: As though the $1.05 trillion dollar price tag wasn’t enough to cause small employers concern, a recent CBO report revealed that $1.67 billion would be realized through penalties on employers and individuals. This only reinforces the fact that, as the cost of the government programs grow, so too will the financial burden placed on small businesses in the form of more penalties, fees and taxes. Codification of SSI Irrevocable Funeral/Burial Trust Exemption. (S. 427/H.R. 1352). We are still looking for appropriate legislative vehicles on which to attach our bill. The most recent are the massive health care reform bill or the SSA FY 2010 appropriations bill. Others may arise, but these seem to be the most viable right now. We also are discussing our proposal with officials at SSA to assuage any fears they may have about our bill and encourage their support or at least neutrality if asked. They are still in the process of putting in place their legislative affairs staff and as a result have not been able to make any definitive decisions on our bill. We hope to meet with them once they are settled and have had a chance to review it. Passage of these bills continues to be a high NFDA priority for 2009. NFDA members can send an e-mail to their members of Congress via Congress-at-a-click at www.nfda.org. urging them to support H.R. 1352 and S. 427 . Simplified Union Organizing Bills (S.560/H.R. 1409). In spite of strong union support, there has been no attempt to move either of these bills. They continue to be very controversial and many of the original supporters are now backing away from it. These are mainly conservative Democrats and those in Republican leaning districts. We do not expect either of these bills to be acted on this year in spite of strong union lobbying and White House support. Unclaimed Veterans Remains (H.R. 2642). We have been working on a solution to this problem for several years. However, we believe that Rep. Tiberi’s bill, with a minor technical amendment we have suggested, has addressed our concerns and offers a realistic solution to this problem. NFDA has advised Rep. Tiberi (R-OH) of our support, with the suggested change we have proposed. NFDA is working with Rep. Tiberi to get this bill passed and signed into law this year. Subchapter S Corporations (H.R. 2910/S. 996). Introduced by Rep. Kind (D-WI) and Senator Lincoln (D-AR), these bills would modernize the current outdated Subchapter S rules to make it easier to elect this corporate form, free up accumulated capital, attract new investors and utilize the value of appreciated property among other things. Since many NFDA members have indicated that they use this corporate form or would like to, we believe this legislation would be extremely helpful to those members. NFDA has joined with other business groups in support of these bills. Financial Product Safety Commission Act of 2009 (H.R. 3126) – this bill would establish a federal consumer watchdog agency over all consumer financial products, services and those who offer them to the public. This may also include preneed trusts and state association Master Trusts and those who sell and manage them. NFDA is seeking language in the Committee Report that will accompany this bill indicating it is not the Committee’s intent to include funeral trusts, master trust or those who sell or manage them under the jurisdiction of this new agency. Bereaved Consumer’s Bill of Rights Act of 2009 (H.R. 3655). Rep. Rush (D-ILL) has introduced this bill in response to the Burr Oak Cemetery scandal that occurred in Illinois this year. It directs the FTC to initiate a federal rule that would regulate cemeteries and all sellers of funeral goods or services in much the same way the FTC Funeral Rule regulates funeral homes. NFDA strongly supports this bill and has indicated that to Chairman Rush in a recent letter. NFDA members can send an e-mail to their members of Congress via Congress-at-a-click at www.nfda.org. urging them to co-sponsor and support H.R. 3655. Indigent Funeral Expense Reimbursement Act of 2009 (H.R. 3809). At NFDA’s request,Representative Broun (R-GA) introduce legislation to allow a federal tax deduction of up to $3,000 for unreimbursed expenses for each indigent funeral and/or burial a funeral home performs at the request of the state or local government. NFDA members can send an e-mail to their members of Congress via Congress-at-a-click at www.nfda.org. urging them to co-sponsor and support H.R. 3809. 2. REGULATORY ISSUES Mass Fatality Management. NFDA continues to work with key officials in the federal government with responsibility for disaster management to ensure that the role and responsibilities of funeral homes, cemeteries and crematories and all funeral service personnel, including industry suppliers are included in the National Response Framework or any mass fatality and family assistance plans that may be adopted. Recent meetings with HHS, DHS, NORTHCOM and various state officials have generated the first ever comprehensive draft federal mass fatality management document (FM CONOPS) dealing with the recovery of human remains, morgue operations, family assistance and final disposition which has be submitted to senior government officials at HHS for review and adoption. Suffice it to say, NFDA will continue to be active in this process to insure the interests of funeral service are properly represented. This is particularly important with the advent of the fall flu season and the estimated additional 90,000 deaths that are expected from the H1N1 flu virus in a brief 3-4 month period. In addition, NFDA continues to develop its own mass disaster plan to insure operational continuity in case of a natural or man-made disaster event. Shipment of Human Remains by Commercial Air Carriers. The implementation of the TSA “Known Shipper” rules that went into effect for funeral service on August 1st seems to have gone very smoothly. Thanks to NFDA’s advocacy and educational efforts, very few problems have arisen since the rules went into effect. We will continue to address unique situations that may arise from time to time with the airlines or TSA to insure our members can properly serve their families. We are now preparing for and working with TSA in developing the new TSA 100% screening for all air cargo, including human remains, which goes into effect in August 2010. Formaldehyde. We continue to monitor the international, federal and state regulatory landscape for any signs of interest or action on limiting the use of formaldehyde for embalming purposes and several interesting developments have recently occurred. First, we have been advised that the publication of the NCI study on formaldehyde exposure and embalmers will be this month. Second, we have learned unofficially that the International Agency for Research on Cancer (IARC) at its Conference in France earlier this month has declared formaldehyde a carcinogen. Third, the federal Environmental Protection Agency (EPA) is undergoing a review of the National Toxicology program and the possible link between formaldehyde exposure and leukemia. In the meantime, we are working with the Communications Department to develop talking points and other materials for our members, the press, public and other audiences in advance of the publication of the NCI study as well as these other proceedings surrounding formaldehyde. They will all be refined once these studies and decisions have been made final and public. Fourth, our ventilation study is almost completed. We expect to have a full report by the time the NCI study is published or immediately thereafter. We anticipate this to be a very valuable document for our members to use to evaluate and upgrade where necessary their prep room ventilation systems to insure they are providing the maximum protection for embalmers from formaldehyde exposure during embalming. Fifth, we anticipate that both EPA and OSHA will propose some sort of regulations in the next year significantly limiting the use and exposure limits for formaldehyde based on all these studies. NFDA will be actively engaged in that process on behalf of funeral service. |