• Preston Sails Through Nomination Vote, Sworn In As Administrator of SBA
• House Committee Hears Testimony on HSAs
• Senate Focuses on Small-Business Pension
• Member Poll: Immigration Reform

Preston Sails Through Nomination Vote, Sworn In As Administrator of SBA

Steven C. Preston Steven C. Preston was confirmed by the U.S. Senate by unanimous consent for the position of Administrator of the U.S. Small Business Administration (SBA). The Senate Committee on Small Business and Entrepreneurship had unanimously recommended Preston’s confirmation. He was sworn into office on Monday of this week. “I am grateful to President Bush for the opportunity to serve in a way that so directly affects the lives of so many Americans,” Preston said. “I am also humbled by the bipartisan support I have received in Congress and am committed to fostering a strong relationship with the many stakeholders of the SBA.” Preston is the 22nd Administrator of the SBA since the agency’s establishment in 1953, succeeding Hector Barreto, who took office on July 25, 2001. For more information, visit www.SBA.gov. House Committee Hears Testimony on HSAs On June 28th the House Ways and Means Committee held a hearing to discuss whether health savings accounts (HSAs) paired with high-deductible insurance plans have been a successful way to deal with the skyrocketing costs of health care. Over 3.2 million people are now covered by HSAs in the United States; half of those covered by a high-deductible plan with an HSA have an income of less than $50,000. Several business owners testified that HSAs have helped them insure more of their employees, reduce premiums and increase flexibility and personal tailoring of service. Opponents of HSAs highlighted their concerns that HSAs only benefit the young, healthy and wealthy. Supporters believe that HSAs are playing a pivotal role in covering the previously uninsured. According to America's Health Insurance Plans (AHIP), in the individual market, 31 percent of those enrolling in HSA/high-deductible health plans were previously uninsured. That number is 33 percent in the small group market. Additionally, in the individual market, 50 percent of enrollees were age 40 and over. The NASE supports HSAs as an affordable health care option for micro-business owners and strongly supports several changes that would improve HSA coverage. These changes included raising the limits on employee contributions to HSAs; permitting the rollover of money from flexible spending accounts; allowing separate deductibles for individual family members instead of one rate for everyone in the family; covering more prescription drugs; and specific rule changes for retirees, veterans, the chronically ill, and low income employees. Tell your legislators what you think of HSAs by using the NASE online Legislative Action Center at http://advocacy.NASE.org. Senate Focuses on Small-Business Pension Plans The Senate Finance Committee recently held a hearing to discuss the problem of small-business pension plans. Only 15 percent of employees who work in businesses with fewer than 20 employees are covered with a retirement plan, and many small-business employers complain that the cost and complexity of a plan outweighs the benefits. The committee listened to suggestions about how to fix this problem. Suggestions from the witnesses included making permanent the savings provisions of the Tax Act of 2001, adding further incentives for retirement savings, changes to the external audits rules, streamlining the process, and lowering the catch-up age for plans to 45 (currently at age 50). Perhaps the most interesting suggestion was to develop a “safety net retirement plan” for businesses that choose not to set up a 401K plan for their employees. In this proposal, businesses with ten or more employees that have been in business for at least two years and have no pension plan would be required to provide automatic payroll deductions. These deductions would be placed into an IRA of the employer’s choice, unless specified differently by the employee. This plan has the potential to positively affect the retirement savings of 40 million of the 71 million Americans who work for a company without a pension. The NASE is considering the impact of many of these proposals. The NASE supports new incentives for personal savings and new small-business pension plans that are simpler and more financially attractive. For more information on the NASE’s position on retirement savings, visit http://advocacy.NASE.org. Member Poll: Contributing to the Community The self-employed and micro-businesses play a vital part in America’s communities. Many micro-businesses support local youth leagues, charities and other community efforts. Let the NASE know how you contribute to your community by visiting the MyNASE Web site at http://my.NASE.org/. Log in to your free MyNASE Web account. If you have not set up an account, you can do so at http://my.NASE.org/ with your member number.