• Micro-Businesses Sound Off On Mortgage And Housing Crisis
• Small Group Health Plan Introduced In Senate
• House Explores Credit Card Usage Among Small Businesses
• Fast Facts: Clinton Health Plan To Limit Premium Costs

Micro-Businesses Sound Off On Mortgage And Housing Crisis

In past years, low interest rates and adjustable mortgages have made home ownership much more affordable for those who had been unable to qualify due to their financial situation or credit score. However, interest rates and mortgage payments have risen sharply during the current slump in the housing market, and that has some home-owning entrepreneurs worried about foreclosure or bankruptcy, according to a recent poll by the NASE. Most micro-business owners currently run successful businesses from a home office. However, forty percent said they were unsure about their ability to afford their home now or in the next few years due to the type of mortgage they have. Continuing to think about future plans, sixty-two percent reported being troubled about the resale value of their home and property. To see the full results of the survey, including solutions most favored by micro-business owners, visit www.nase.org.

Small Group Health Plan Introduced In Senate Lawmakers and health groups have banded together to spread the word about new legislation designed to offer better access to health insurance for the 6 million small businesses and for 14 million self-employed individuals. "We are pleased to see Members of the Senate moving forward in bipartisan fashion to address the critical issue of access to affordable health coverage for micro-businesses,” said Kristie Darien, executive director of the NASE legislative office. “The NASE is currently reviewing this bill to determine if this approach will best assist our members as well as all of our nations’ self-employed." The Small Business Health Options Program (SHOP) allows small firms to consolidate into groups on both the state and national level for the purpose of purchasing health insurance and obtaining lower premium costs. Businesses of a certain size would receive tax breaks in return for contributions to workers’ premiums. SHOP would prohibit the practice of rating based on current health status or previous illness. The bill specifically allows the self-employed to band together and participate in these pools with small businesses in order to obtain health insurance, and offer the self-employed a tax credit to purchase coverage. “The majority of uninsured Americans are self-employed individuals and employees of small businesses,” remarked bill sponsor Senator Blanche Lincoln (D-AR). “This legislation will help our small businesses—the economic backbone of our communities—offer health insurance to their employees, which helps with recruitment, retention, employee performance, and the overall success of the business. Most importantly, our bill will allow us to begin to address the needs of the millions of working uninsured Americans whose top priority is access to quality and affordable health care for their families.” Learn more about the proposal at http://durbin.senate.gov.

House Explores Credit Card Usage Among Small Businesses The House Small Business Committee held a hearing recently to discuss the increasing role of credit cards as financial tools for small businesses. The witnesses at the hearing cited the ease of using credit cards to secure financing as a significant factor in their popularity among small businesses. They reported that, for the approximately 70% of small businesses who pay off their debt every month, credit cards act as an easy cash advance. However, they acknowledged that the “loans” often come at the cost of significantly higher rates. The hearing also served to highlight problems resulting from the recent fee and rate increases to Small Business Administration (SBA) loan programs. According to a recent Federal Reserve survey, 65% of senior loan officers reported tightening lending standards in the first quarter of 2008. Committee members argued that this, in combination with rising fee and rates on SBA loans, will force many small business owners to find other sources of financing, such as credit cards. Committee members claim that this has contributed to a 14% increased in the use of credit cards among small businesses. This coincides with an NASE poll conducted last year that found that 21% of respondents cited credit cards as their primary source of ongoing financing. To view the hearing, please visit House Committee on Small Business website: www.house.gov/smbiz/democrats.

Fast Facts: Clinton Health Plan To Limit Premium Costs Democratic presidential candidate Senator Hillary Clinton (D-N.Y.) is calling for a universal health care plan wherein individuals would pay no more than 10 percent of their income for insurance. While not disclosing specific figures, Sen. Clinton mentioned implementing a restriction on premium costs to aid in helping obtain coverage for the nation’s 47 million uninsured. Visit the NASE’s Health Resource Center to read more about the proposed health plan.     Lawmakers and media outlets across the country rely on and regularly cite the NASE as a source of small and micro-business expertise. Help the NASE make sure the micro-business perspective is heard by taking this month’s poll. Click here to log-in and participate. Washington Watch Online Visit the NASE Advocacy Web page to view archived editions of Washington Watch. While you’re there, read the latest updates from the Washington, D.C. office, write your Congressperson, and find out how you can join the fight for micro-business. Web site: http://advocacy.NASE.org.