• New Session of Congress Commences

• NASE Announces 2003 Legislative Priorities

• White House Releases Stimulus Plan

• SBA AND DOD Streamline Database for Small Business Access to Federal Contracts

• SBA Ombudsman Publicizes Meeting Schedule

New Session of Congress Commences

The 108th Congress arrived in Washington, D.C., this week, ready to finish outstanding appropriations bills and move on to a new Republican-led agenda. Sen. Bill Frist (R-TN) was sworn in as the chamber’s Majority Leader after controversy forced Sen. Trent Lott (R-MS) to step down from the position. Republicans also control the House of Representatives, with Rep. Dennis Hastert (R-IL) retaining the top position as Speaker.

Both Chambers will hold committee elections this week, so the make-up of the House and Senate small-business committees will change. Sen. Olympia Snowe (R-ME) will take over as chair of the Senate Committee on Small Business and Entrepreneurship. Visit http://advocacy.nase.org/ and urge Sen. Snowe to focus the committee’s agenda on the needs of the self-employed and micro-businesses.
 

NASE Announces 2003 Legislative Priorities

The NASE announced its 2003 Legislative Priorities as the 108th Congress convened in Washington, D.C., this week. Clarification of the independent contractor definition, access to affordable health care and tax equality top the priorities list.

“This set of legislative priorities really focuses on the needs of the self-employed and micro-businesses, businesses with 10 employees or less, as a segment of the larger ‘small-business’ community,” said Kristie Darien, NASE director of government affairs. “By concentrating on these issues, we bring the needs of the backbone of the American economy to Congress.”

A clarification in the independent contractor definition is needed to help the self-employed and micro-businesses determine who is an employee and who is a contractor for tax purposes.

Access to affordable health care is also a priority for the NASE. According to a 2002 NASE survey, 70 percent of micro-businesses did not have health coverage themselves or offer it to their employees. Census data indicates that 62 percent of the more than 41 million Americans without health insurance are from families in which the head of household is self-employed or working for a company with fewer than 100 employees.

In 2003, the NASE will work to influence passage of favorable health care legislation. Key legislation for the coming year includes Association Health Plans and health care tax credits. The NASE is also determined to find a solution to unfair taxation on the self-employed’s health insurance premiums. Under present tax laws, corporations are able to deduct health insurance premiums as a business expense and to forego FICA (Social Security and Medicare) taxes on these premiums. In contrast, the self-employed are required to pay an additional 15.3 percent self-employment tax on these expenses.

The NASE tax equality priorities include an increase in the deduction for business meals and equipment expensing.

Also in 2003, the NASE will continue its Women Entrepreneurship initiative. Last summer the NASE co-sponsored summits across the nation to address the concerns of this growing sector of the small-business population. NASE President Robert Hughes, who runs his own accounting practice, spoke to summit participants about health care and tax issues.

Read about these issues and more NASE Legislative Briefs at advocacy.nase.org.
 

White House Releases Stimulus Plan

President George Bush and the White House unveiled their economic stimulus plan this week with hopes that it will strengthen the current economy. The proposal would provide close to $670 billion in tax cuts over a 10-year period.

The President's economic plan would:

• Speed up the 2001 tax cuts. Currently, taxpayers will receive additional relief in 2004 and then again in 2006. This new plan would make all the tax rate reductions from the 2001 tax law effective this year - and retroactive to January 1, 2003.

• Speed up three other tax reductions from the 2001 approved tax cut:

  • Marriage penalty tax would be reduced this year rather than in 2009.

  • Child tax credit would be raised to $1,000 from $600 in the current year rather than in 2010.

  • Several million taxpayers would be shifted to the lowest tax bracket of 10 percent this year instead of in 2008.

• Cut dividend taxes by allowing taxpayers to exclude dividend payments from their taxable income.

• Provide small-business tax relief by increasing Section 179 expensing limits for business equipment purchases. Current tax laws permit small-business owners to write off $25,000 of equipment purchases. The President’s plan would increase that to $75,000.

• Extend unemployment benefits that expired on December 28, 2002.

The National Association for the Self-Employed is pleased to see the addition of an increase in business equipment expensing, which had been a top legislative priority for the NASE throughout the last legislative session.

The President’s economic package will likely be a point of debate within Congress. Democrats have introduced their own economic stimulus plan, which also includes tax incentives for small-business investment and payroll tax relief.

For more information, please contact Kristie Darien, NASE director of government affairs, at kdarien@nase.org.
 

SBA and DOD Streamline Database for Small Business Access to
Federal Contracts

The U.S. Small Business Administration and the Department of Defense recently completed the integration of two federal contractor databases: the Procurement Marketing and Access Network (PRO-Net) and the Central Contractor Registration (CCR). The linkage is aimed at simplifying the contracting process for small and micro-businesses. This economic sector provides over $50 billion in goods and services to federal agencies each year.

The CCR-PRO-Net linkage allows vendors to input information in both databases simultaneously. Through this single registration effort, a small business can now market its wares, furnish the information an agency will need to do business with it and ensure it receives timely payment for the work it performs. According to an SBA press release,

It will save new small-business registrants approximately 30 minutes during the initial registration process.

PRO-Net is the government’s electronic gateway to information by and for small and micro-businesses. It serves as both a marketing development tool for small businesses seeking to do business with government agencies and a market research tool for government buyers looking for small businesses that can help to meet their agencies’ needs. The system can be used free of charge by micro- businesses looking to partner with other small companies to handle the larger, more complex contracts. It also has a special section dedicated to subcontracting opportunities at http://web.sba.gov/subnet.

The CCR is a central repository for information about federal contractors that the government needs in order to transact with them. The CCR allows contractors to provide and update information in one place and agency buyers to obtain the information they need from one site. It is currently used by Department of Defense and several other agencies and is being ramped up to become the primary repository for all agencies.

For more information, please visit the PRO-Net and CCR Web sites.

For more information about all of the SBA’s programs for small businesses, call the SBA Answer Desk at 1-800 U ASK SBA or TDD 704-344-6640, or visit the SBA’s extensive Web site.
 

SBA Ombudsman Publicizes Meeting Schedule

The U.S. Small Business Administration National Ombudsman, Michael Barrera, announced the following meeting schedule for the first quarter of 2003. The NASE encourages its Members to attend meetings near them, especially if you have had a problem with specific excessive regulatory enforcement actions by federal agencies. Check the National Ombudsman Website and look under “Events” for registration information and new announcements.

January 14: Salt Lake City Fair Federal Enforcement Roundtable at the U.S. Small Business Administration District Office, 125 South State Street, Salt Lake City, UT. In addition to in-person attendance, small-business owners and trade organization leaders from Montana, North Dakota, South Dakota, Wyoming, Colorado and Utah are invited to participate through free audio teleconferencing.

January 29: A New Jersey Fair Federal Enforcement Hearing will be hosted by the U.S. Small Business Administration at the State House Annex, 4th Floor, Assembly Budget Committee Hearing Room, State Street, Trenton, New Jersey.

February 3-10: Hilo and Oahu, Hawaii, Fair Federal Enforcement Hearing and Roundtables plus media and trade association meetings.

February 20: Washington, D.C., Fair Federal Enforcement Hearing, Martin Luther King Memorial Library, 901 G Street, NW, A-5 Auditorium, Washington, DC.

March 25: Tuscon, Arizona Hearing

March 27: Denver, Colorado Hearing
 

Do any of these issues affect you? Do you want to be proactive in helping the micro-business community? Visit the NASE's Legislative Action Center and “Tell Your Small Business Story.” This will help the NASE understand - on a personal level - how key legislative issues are affecting your business and your bottom line.

For more information about any of the articles in Washington Watch, contact Maureen Petron, NASE public affairs manager, at (202) 466-2100 or mpetron@nase.org.