Tag Archives: Public Affairs

Guest Post | Thoughts on PPAI L.E.A.D. in Washington, D.C.

If Coke and Pepsi can set aside their battle of the brands for a worthwhile cause, so too can the promotional products industry. During PPAI’s Legislative Education and Action Day (L.E.A.D.) event held in May, industry representatives from around the country united to encourage our nation’s legislators to consider critical issues important to the entire industry.

Today I am pleased to present a guest post, “Thoughts on PPAI L.E.A.D. in Washington, D.C.”  by Kyle A. Richardson, editorial director of Promo Marketing magazine. This PM blog originally appeared in the June 27, 2016 issue of Promo Marketing.

Thank you, Kyle, for joining us for the PPAI L.E.A.D. We are grateful for your participation and retrospective on the critical importance of our industry’s unified voice in D.C.

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Last month I had the privilege of joining a select group of promotional products professionals in Washington, D.C., for Promotional Product Association International’s (PPAI) Legislative Education and Action Day (L.E.A.D.). Influential industry members from across the country volunteered their time to head to our nation’s capitol, to raise awareness about our industry and the legislation that impacts suppliers and distributors.

We’ve reported on many of these business topics—independent contractor requirements, the Affordable Care Act, Toxic Substances Control Act reform—but it is another thing entirely to go to D.C. and speak to senators and representatives about our industry, our concerns and our needs. When you see a small section of our community—just 80 volunteers in all—organize more than 300 meetings over two days, you start to appreciate the significance of what PPAI has put together.

It isn’t just the numbers, either: Who was in attendance is just as important. Supplier CEOs, distributor franchisees, multi-line representatives and more all stood united in D.C. We were organized by state, with many groups consisting of companies in direct competition with one another. Along with some suppliers and distributors, I was on the Pennsylvania team representing Promo Marketing next to ASI’s own senior vice president and senior counselor, Chuck Machion. No one was concerned about business rivalries. We were all there to do the same job.

PPAI_LEAD - PM 6-27-16

Left to Right: Kyle A. Richardson; Bruce Korn, CAS, president of Zakback Inc.; U.S. Rep. Ryan Costello (R-PA); Larry Whitney, director of global compliance for Polyconcept North America.

What most stood out, however, was seeing that what we’re doing works. In several meetings, staffers greeted members of our team by name, recalling them from last year’s event. In other meetings, representatives mentioned receiving emails from suppliers and distributors as part of Promotional Products Work! Week. One staff member we met with took notes on the PPAI L.E.A.D. notebook he received in 2015. If you think events like this don’t have an impact, you’d be surprised.

You also may be surprised to learn that every D.C. staffer looks like they’re 17. Don’t let “House of Cards” fool you: Everyone in the Capitol is too young to drink.

I want to thank PPAI for inviting me along this year, as well as all the members of my team—Chuck, Bruce Korn of Zakpack Inc., George Jackson of George Jackson Promotions, Larry Whitney of Polyconcept North America and Norm Hullinger of alphabroder.

It’s said you should lead, follow or get out of the way. The promotional products industry has made it clear which path it will take.

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Kyle Richardson

Kyle A. Richardson is the editorial director of Promo Marketing. He joined the company in 2006 brings more than a decade of publishing, marketing and media experience to the magazine. If you see him, buy him a drink.

 

PPAI Responds to The Oklahoman’s Report on State Spending on Promotional Products

Oklahoma Take Action: Tell your officials and representatives that you support responsible spending and the effective use of promotional products to promote essential government programs – and urge them to do the same.

Write your representatives now.

The Oklahoman MastheadA few days ago, The Oklahoman editorial board published the article, “In attacking Oklahoma state budget hole, every little bit of savings helps,” on wasteful government spending on promotional products.

PPAI answered the report with a response supporting responsible spending and the effective use of promotional products to promote essential government programs. Thus, allowing readers to consider the facts for themselves.

I encourage you to write your representatives to share how extensive industry research demonstrates that promotional products deliver the highest rate of reach, recall and response making them one of the most effective advertising and marketing media for all advertisers, including federal, state and local governments.

Thank you for your support.

Paul

Inside PPAI’s 2013 North American Leadership Conference & Product Safety Summit | A special message from PPAI Chair, Marc Simon

NALC 2013: Perspectives on the Promotional Products Industry presentation.

NALC 2013: Perspectives on the Promotional Products Industry presentation.

On August 11-15 in Chicago, PPAI hosted two of our most popular and powerful educational opportunities—North American Leadership Conference and Product Safety Summit. Over the course of four-and-a-half days, we were treated to a series of superb speakers who shared countless years of experience on hotly relevant topics from innovation, marketing and the economy to product recalls, FDA regulations and social compliance—to name just a few. For PPAI’s Chair of the Board Marc Simon, it was also a thrill to hold these two exceptional events in his hometown. Below, Marc shares a special message with you.

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Greetings to our valued members!

For those of you who attended PPAI’s North American Leadership Conference (NALC) and/or PPAI’s Product Safety Summit (Summit) in Chicago earlier this month, I want to thank you, on behalf of the PPAI Board of Directors and staff, for your enthusiastic and attentive participation. Based on the comments we have received, it is fair to say that NALC and Summit were enormous successes.

If you were unable to attend either conference, let me tell you what you missed.

First, a few numbers: We had more than 150 participants at NALC and more than 180 participants at Summit. Notably, these were largely different groups of people. More frequently, senior management attended NALC and a combination of senior execs and people responsible for product safety and compliance attended Summit. Approximately 300 people in total participated in various aspects of this great week.

There were two themes to these back-to-back conferences: content and volunteerism. Let me explain.

For both conferences, we recognized that everyone’s most valuable resource is his or her time. We needed to be certain that we used everyone’s time judiciously. Both NALC and Summit participants heard from recognized experts who were impressive and even entertaining.

Gary Shapiro, CEO of the Consumer Electronics Association (CEA), was NALC’s first speaker. Gary made the point that innovation is critical for an industry, for a company, indeed for an individual, to survive and prosper. He observed that innovation is cultural and spoke of the many ways in which the culture and diversity of the United States breeds innovation. He contrasted that with other cultures, including China. It was ironic that the CEO of CEA, the bastion of technology—which is often blamed for limiting human interaction—spoke of the importance of relationships, face-to-face experiences and five-sense experiences to build trust and confidence, which are the essential ingredients of innovation. Gary’s presentation gave reason for encouragement—innovation is cultural (our culture), and relationships remain vitally important.

Next, Northwestern University Professor Frank Mulhern led us through the evolution of advertising from the presumed monolithic, homogenous state in which we know what consumers want and where consumers are captive to where we are today and where we are headed. Brands are shifting from products and services to people and lifestyles. Content marketing is everything, and “earned” media is growing rapidly. Marketing is becoming organized by interests, and people connect based on shared interests. As a result, marketing is becoming more analytical and targeted. (And therein lies the reason our industry will continue to grow. What can be more targeted and analytically based than our solutions?) Also, gamification is growing in popular appeal, another trend that favors our industry.

Our most knowledgeable, interesting and entertaining NALC speaker highlighted Tuesday’s lineup. Austan Goolsbee was previously chairman of the White House Council of Economic Advisors and is now a University of Chicago professor. He made three key points: 1. The economy is in for another 12 to 24 months of sluggishness, 2. The government is not going to help, and 3. Pent-up demand, the most productive work force in the world and our culture of innovation and entrepreneurialism will eventually push through all the clutter to lead us to new economic heights. I could not possibly do justice to the wit, humor and delivery style Goolsbee displayed, but we all laughed at the unintended consequences of lasagna and plumbing bombs (ask someone who attended for the details) as well as the observation that no one ever died jumping out of a basement window. Goolsbee spoke for an hour and took questions for another half hour. The universal comment we all heard was, “I could have listened to him all day.”

Product Safety Summit speakers included a panel of brand-integrity officers representing three of the world’s most valuable brands—The Coca-Cola Company, The Walt Disney Company and John Deere— speaking to the challenges and goals they face every day. Directors from the Consumer Products Division of Underwriters Laboratories gave a primer in the product safety requirements our industry faces.

It was a huge honor to have Neal Cohen, U.S. Consumer Product Safety Commission Small Business Ombudsman, as one of Summit’s keynote speakers. He spoke to the special considerations that exist in our laws and regulations to account for the practical limitations of small businesses. John Fuson, most recently the U.S. Food and Drug Administration’s associate general counsel for major enforcement actions, was fascinating as spoke of the practical requirements to which our industry’s food and drug niche (including hand sanitizers, for instance) is subject. Another government speaker, Jim Joholske, the assistant executive director of the Office of Import Surveillance for the CPSC, gave insights into new laws and regulations that our people now encounter every day. His interest in helping our industry was obvious—especially as he told listeners that if they couldn’t resolve an import issue, they were welcome to reach out to him for help.

The big hit of the outside expert Summit speakers was Katherine Cahill, an independent consultant. She spoke about the responsibilities that arise when product recalls are indicated. Her session, scheduled for 90 minutes, ran over by a full hour, as no one was willing to leave the room. She was filled with practical advice and everyone got a lot from her session.

Now for the second theme: volunteerism. None of this would have been possible without the tireless efforts and painstaking attention to detail from several PPAI members who volunteered their time to make this event so valuable for all of us—and each of these people has a full-time, demanding job outside of PPAI volunteer responsibilities.

We owe a great debt of gratitude to Gene Geiger, CEO of Geiger, and to Rick Brenner, CEO of Prime Resources, for their passion and commitment in personally attending to each and every detail of the Product Safety Summit. I also want to recognize CJ Schmidt of Hit Promotional Products and Marc Held of Bodek and Rhodes for their exceptional work as co-leaders of the NALC Work Group. Jonathan Isaacson, CEO of Gemline, had to have spent 100 hours doing the research, analyzing the results and putting together his highly informative NALC presentation on trends that are apparent on the supplier side of our industry. NALC presentations by Larry Cohen, CEO of Axis Promotions, on how suppliers can work more effectively with distributors and by Jeff Meyer, CEO of Certified Marketing Consultants, on mergers and acquisitions were just two of the many sessions that were both interesting and valuable. Thank you also to those peers who shared their valuable insights on a series of panels that explored relevant topics throughout both conferences. A final and personal thank-you goes to the dozen large distributor and supplier companies that quietly sponsored Austan Goolsbee’s appearance.

I was very proud to have my hometown show so well to all of our participants. Next August (August 10-12, 2014, and August 13-14, 2014, respectively), we are going to Boston, and the prospect of interacting with professors from Harvard and MIT is at least as exciting. So please join us!

Marc Simon
PPAI Chair of the Board

For session summaries, photos and a video Q&A with Austan Goolsbee, visit http://ppblive.tumblr.com.

 

 

Guest Blog: George Jackson, Legislative Chair of TRASA, shares his L.E.A.D. experience.

PA Group with Rep Tim Murphy

L.E.A.D., Legislative Education Action Day, sponsored by PPAI, is a unique experience. In April, I was able to attend my fourth L.E.A.D. experience. Each year they are similar, yet different. Attending meetings on the “Hill” in Washington, D.C. with your Member Of Congress and/or their staff is an exciting and challenging event.

This year I was again in charge of Team PA (Pennsylvania), and we had 13 scheduled meetings and 10 drop-in meetings. One of the challenges that you face each year is keeping the MOC and their staff in your corner. We have met with several MOCs and staff members from year to year and they remember us. This is what we strive for, them remembering who we are and what we do as well as their stating to us that they will keep on the lookout for legislation that could have a negative effect on the promotional products industry; a small yet meaningful victory for L.E.A.D.

Take the independent contractor issue as an example. Four years ago, very few if anyone even knew what we were referring to. We continue to discuss this issue each year we attend L.E.A.D. This year, after four trips, we came away with both MOCs and staff not only knowing the details of the issue, but now we are able to depend on their support on this issue if it comes up in either chamber. They now understand more about the PP Industry, the large number of small businesses that are it’s makeup and the impact that could result. Another small victory for PPAI.

This year we were invited to a senator’s AM coffee. The senator and staff are there to meet and greet with you and discuss briefly, issues that affect your industry. It is a way for the senator and his staff to meet with many people in a short period of time. We were again able to garner support on industry issues from this meeting.

L.E.A.D. is an event that strengthens your resolve towards the leaders in Washington, D.C. and proves that a small group of individuals can band together, meet with a MOC or staff from almost all 50 states and accomplish something important. We are a small group, which needs to grow, yet a mighty one. The PPI is an $18 billion industry that is slowly making inroads at both the federal and state government levels to ensure the protection of our members.

PPAI supports all of the Regional Associations’ Legislative Committees across the USA and brings them together with other volunteers at L.E.A.D. Even with this we need your help and support. Plan to join PPAI at L.E.A.D. in 2014. Attend an education class at Expo, Expo East, or at your local regional trade show, on government relations, legislative and/ or consumer product safety. This is your industry and it needs your help and support to keep it viable and productive.

Thank you,
George Jackson
Legislative Chairman, TRASA

The Washington Report- Marketplace Fairness Act

Marketplace Fairness Act Targets Out-Of-State Sellers

Through our legislative contacts and lobbyists, PPAI has access to up-to-the-minute information, insight and analysis that you won’t see published anywhere else. The information in this month’s special Washington Report focuses on the Marketplace Fairness Act and the debate over the collection of sales and use taxes from consumers by out of state sellers. It is timely information that will help you become more aware and better prepared to advocate for your business, profession and industry.

I hope you find this information beneficial to your business.

Legislation has been introduced that addresses a long-standing debate over the collection of sales and use taxes from consumers by out-of-state sellers for the states in which those consumers reside.

The Marketplace Fairness Act, introduced in the Senate as S. 336 and in the House as HR 684, reflects several states’ acceptance of the Streamlined Sales and Use Tax Agreement (SSUTA) in 2002. The SSUTA is essentially a multi-state agreement to simplify national sales tax laws by establishing a uniform system of administering and collecting sales tax on out-of-state retail transactions—these transactions alone add up to several trillion dollars.

The SSUTA was approved in 2002 by a vote of representatives of 33 states and the District of Columbia. That number currently stands at 44 states.

The effort as it is being implemented by participating states is known as the Streamlined Sales Tax Project (SSTP). Twenty-four states representing more than 33 percent of the nation’s population have adopted the simplification measures set forth in the SSUTA by passing legislation that conforms to the agreement.

Under the SSUTA, member states are allowed to require remote sellers to collect and remit sales-and-use taxes after 90 days. The legislation exempts sellers who make less than $1 million in total remote sales in the year preceding the sale; they qualify for an exemption and would not be required to collect the tax.

States that do not want to become SSUTA members would only be allowed to collect sales and use taxes on out-of-state transactions if they adopted certain minimum simplification requirements and if they provided sellers with additional notices on the collection requirements, which are similar to but less comprehensive than SSUTA member conditions.

Sales And Use Tax History

The legislation’s history dates back more than four decades. Under the structure of state taxation, sales and use taxes are imposed on the consumer. The obligation on the seller, if any, is to collect and remit the tax. While the sales tax is the component collected by a seller on a transaction occurring within the state, the use tax is essentially a fictional component created to capture the tax made on out-of-state sales.

The purchaser is obligated to pay the use tax on any goods or services bought out of state and used in the state. Theoretically, the purchaser is always obligated to pay either the sales tax or the use tax. But few purchasers voluntarily pay the use tax and it is impossible to enforce compliance on a purchaser-by-purchaser basis.

A state can force a seller to collect sales tax since it has jurisdiction over the seller and can use leverage—such as the seizure of assets—to force compliance. If the seller has a facility in the state, the question of jurisdiction is easily resolved. In the case of an out-of-state seller, determining whether the seller has sufficient contact with a state to warrant collecting use tax from an in-state purchaser has been disputed long before the Internet became a marketplace.

In-State Presence

In National Bellas Hess v. Illinois Department of Revenue (1967), the Supreme Court ruled that states could not collect a sales or use tax from a firm that did not maintain a retail outlet within the state’s boundaries. In legal parlance, the company had to have “nexus,” or a connection with the state, upon which the state could claim jurisdiction.

In 1992, the Supreme Court decided the Quill Corp. v. North Dakota case involving a North Dakota statute drafted to specifically circumvent National Bellas Hess case. The North Dakota statute was drafted to define nexus to include “regular or systematic solicitation of a consumer market.” Regulations further defined this as three or more advertisements within a 12-month period.

Justice Stevens, speaking for the Supreme Court, said: “We do not share [North Dakota’s] conclusion that the ruling of Bellas Hess is no longer good law.” The Supreme Court, however, did make an observation that is essential to understanding the significance of the Streamlined Sales Tax Project agreement and possible federal legislation on nexus: “Our decision is made easier by the fact that the underlying issue is not only one that Congress may be better qualified to resolve, but also one that Congress has the ultimate power to resolve. No matter how we evaluate the burdens that use taxes impose on interstate commerce, Congress remains free to disagree with our conclusions.”

The Marketplace Fairness Act is the proponents’ answer to this suggestion.
The following states have passed legislation to conform to the SSUTA:
Arkansas; Georgia; Indiana; Iowa; Kansas; Kentucky; Michigan; Minnesota; Nebraska;
Nevada; New Jersey; North Carolina; North Dakota; Ohio; Oklahoma; Rhode Island;
South Dakota; Tennessee; Utah; Vermont; Washington; West Virginia; Wisconsin; Wyoming

The lead sponsors of the Marketplace Fairness Act are:
Sens. Mike Enzi (R-WY); Dick Durbin (D-IL), Lamar Alexander (R-TN); Heidi Heitkamp (D-SD)
Reps. Steve Womack (R-AR); Jackie Speier (D-CA); Peter Welch (D-VT); John Conyers (D-MI)

Additional co-sponsors of the legislation:
House of Representatives
Aaron Schock (R-IL); Dennis Ross (R-PA); Chris Gibson (R-NY); Steve Cohen (D-TN);
Mario Diaz-Balart (R-FL); Judy Chu (D-CA); Ander Crenshaw (R-FL); Chellie Pingree (D-ME);
Renee Ellmers (R-NC); Allyson Schwartz (D-PA); Don Young (R-AK); Keith Ellison (D-MN);
Ted Poe (R-TX); Ted Deutch (D-FL); Rick Crawford (R-AR); Linda Sanchez (D-CA);
Michael Grimm (R-NY); Niki Tsongas (D-MA); Charlie Dent (R-PA); Hank Johnson (D-GA);
Mark Amodei (R-NV); Michael Capuano (D-MA); Mike Conaway (R-TX); Betty McCollum (D-MN);
Kristi Noem (R-SD); John Larson (D-CT); Lou Barletta (R-PA); James Langevin (D-RI);
Tim Griffin (R-AR); Eleanor Norton (D-DC); Suzan DelBene (D-WA).

U.S. Senate
Tim Johnson (D-SD); John Boozman (R-AR); Jack Reed (D-RI); Roy Blunt (R-MO);
Sheldon Whitehouse (D-RI); Bob Corker (R-TN); Mark Pryor (D-AR); Jay Rockefeller (D-WV);
Amy Klobuchar (D-MN); Al Franken (D-MN); Ben Cardin (D-MD); Dianne Feinstein (D-CA);
Mary Landrieu (D-LA); Joe Manchin (D-WV)

PPAI’s Washington Report

Through our legislative contacts and lobbyists, PPAI has access to information, insight and analysis that you won’t see published anywhere else. Information that will help you better understand how what happens in D.C. can affect your business and employees at home—information that will help you become more aware and better prepared to advocate for your business, profession and industry.

This edition of the report highlights the very recent work of the Securities and Exchange Commission (SEC) on the Dodd-Frank Reform’s conflict-minerals provision and the possible impact of the shortened Congressional session on several expiring tax provisions.

I hope you find this information beneficial to your business.

CONFLICT MINERALS
The Securities and Exchange Commission (SEC) has issued a final rule providing guidance on what had become a very confusing issue—tracking “conflict minerals.” It started when Congress passed and the President signed into law the Dodd-Frank Wall Street Reform And Consumer Protection Act in 2010. Public Law 111-203 includes a provision that will require some businesses already required to file reports to the SEC under other laws (the SEC calls them “issuers”) to disclose the source of certain conflict minerals. According to the Conference Report issued by Congress, the provision of the new law “requires disclosure to the SEC by all persons otherwise required to file with the SEC for whom minerals originating in the Democratic Republic of Congo and adjoining countries are necessary to the functionality or production of a product manufactured by such person. Such a public disclosure report by the person must describe the measures taken to exercise due diligence on the source and chain of custody of such materials, the products manufactured, and other matters; requires an independent audit of the report.” The term “conflict mineral” means columbite-tantalite (coltan), cassiterite, gold, wolframite, or their derivatives; or any other mineral or its derivatives determined by the Secretary of State to be financing conflict in the Democratic Republic of the Congo or an adjoining country.

Most businesses in the promotional products industry do not file reports with the SEC and therefore do not have a direct conflict mineral reporting requirement under the law. The earlier confusion about this law resulted from the fact that businesses that do file reports with the SEC (some of our end buyers) were asking all of their suppliers and vendors to supply information about the vendors and suppliers’ products. The SEC has confirmed the law applies only to the products that the company required to file SEC reports manufactures or contracts to have manufactured for them. In other words, the reporting and supply chain tracking is confined to their (the end buyer) products only, not your products. This is not like the situation created by the Consumer Product Safety Improvement Act (CPSIA) that created a potential liability for the end buyer for your products.

 SHORT SEMESTER
Congress returns after Labor Day and will attempt to get out of town by mid-October. Unless you have been vacationing in Antarctica, you probably are already acutely aware that the entire House of Representatives is up for re-election, as is one-third of the Senate. Their desire to campaign drives their interest in a short session of Congress before the November elections.

The House will only be in session for 13 days before the congressional elections–not a lot of time to turn the car around before we come to the fiscal cliff you have heard about. All kinds of tax relief provisions expire at the end of the year (some have already!), automatic across-the-board-spending cuts in the federal budget take effect in January, and we will probably bump up against our federal debt ceiling again. Only the most optimistic fans of Congress still think they will do something before the election. Most observers have long been convinced we will hear the quacking call of a lame duck session after the election. As a result, the 13 workings days are probably 12 more than they will need unless they want to get serious about the fiscal cliff. There is certainly plenty of evidence that we would be better off if they got serious sooner than later. The Congressional Budget Office recently told Congress: “In CBO’s judgment, the sharp increases in federal taxes and reductions in federal spending that, under current law, are scheduled to begin in calendar year 2013 are likely to interrupt the recent economic progress, resulting in what would probably be considered a recession.” If they wanted to deal with tax issues, there is a short list of important items. The following are some we have identified.

The latest extension of the temporary increases in the income levels for which the Alternative Minimum Tax (AMT) is waived expired at the end of 2011, so technically many of us are already at risk. This “rolling” extension is referred to as the AMT “patch.” The law provided that the individual AMT exemption amounts for taxable years beginning in 2011 were $74,450, in the case of married couples filing a joint return and surviving spouses and $48,450 in the case of individuals. In 2012, the exemption amounts have reverted to $45,000 for married couples filing jointly and $33,750 for individuals.

The top individual marginal income tax rate has been sitting at the reduced rate of 35 percent for the past decade-plus. It will return to its pre-2001 level of 39.6 percent in 2013.

For the past decade, the maximum rate of tax on net capital gain of a non-corporate taxpayer has been 15 percent. In addition, any net capital gain which otherwise would have been taxed at a 10 or 15 percent rate generally has been taxed at a zero-percent rate. For taxable years beginning after December 31, 2012, generally the rates on net capital gain will be 20 percent and 10 percent, respectively.

For the past decade, dividends received by a noncorporate shareholder from domestic corporations and qualified foreign corporations generally have been taxed at the same rates that apply to net capital gain. Thus, dividends received by an individual, estate, or trust have been taxed at rates of zero and 15 percent. For taxable years beginning after December 31, 2012, dividends received by a non-corporate shareholder will be taxed at the same rates as ordinary income.

The estate tax exemption is currently $5 million per person and $10 million per couple and the top estate tax rate is 35 percent. The exemption amount is indexed beginning in 2012 and is $5,120,000. Under prior law, couples had to do complicated estate planning to claim their entire exemption. A recent temporary change allows the executor of a deceased spouse’s estate to transfer any unused exemption to the surviving spouse without such planning, effective for estates of decedents dying after December 31, 2010. The system will revert to pre-2001 status at the end of 2012. This means we are going back to a single graduated rate schedule with a top rate of 55 percent and a single effective exemption amount of $1 million.

The depreciation bonus sits at 50 percent for most assets acquired in 2012. It disappears at the end of 2012. The adjusted direct expensing allowance for capital assets acquired in 2012 is $139,000 and the phase-out cap on purchases for the year is $560,000. At the beginning of 2013, the amounts revert to pre-2003 levels of $25,000 and $200,000 without inflation indexing.

Earlier this year, Congress passed and the President signed into law the Middle Class Tax Relief and Job Creation Act of 2012 (MCTRJCA). It extended the temporary two-percentage-point payroll tax “holiday” for employees (and to the same extent, to the self-employed) through the end of 2012.

Beyond The Headlines: PPAI’s Washington Report Gives You The Inside Scoop

Postal service reform and small business tax cut bills have made national headlines lately. I’m glad to offer PPAI members an in-depth look into these issues and how they could impact your business.  

I hope you enjoy this month’s inside-look into the issues that make headlines—PPAI’s Washington Report:

HELP FOR THE POSTAL SERVICE
As predicted last month, the Senate returned to the topic of United States Postal Service (USPS) reform and the Senate has passed S. 1789, the 21st Century Postal Service Act, introduced by Senators Susan Collins (R-ME) and Joe Lieberman (I-CT). Among other things, the bill would give the Postmaster General access to money the USPS has overpaid into one of its pension funds (Federal Employees Retirement System, or FERS) and use it to offer buyouts or retirement incentives to reduce the active postal workforce by 100,000 or more employees over the next several years.

The bill would also allow the USPS to offer non-postal products or services if the PRC has determined that the products and services: 1) make use of USPS’s processing, transportation, delivery, retail network, or technology; 2) are consistent with the public interest and a demonstrated demand for the USPS to offer them; 3) do not create unfair competition with the private sector; and 4) have the potential to improve the USPS’s financial condition.

The reason the Senate had to take two runs at passage was that there were objections to the possibility of cutting back delivery services and closing some post offices and processing facilities. The Senate-passed version includes compromises on those issues. The House will now consider its own version, H.R. 2309, and it does not include the compromises. House Oversight and Government Reform Committee Chairman Darrell Issa (R-CA) made the following statement upon the passage of the Senate bill: “While the Postal Service is actually trying to shutter some facilities it does not need, the Senate bill forces the Postal Service to keep over one hundred excess postal facilities open at a cost of $900 million per year. Worst of all, the Senate bill does not stop the financial collapse of USPS, but only delays it for two years, at best, when reforms will only be more painful. The Senate’s approach is wholly unacceptable.”

The House bill would give the USPS the option of eliminating Saturday delivery six months after the enactment of the legislation. It would create a two-year task force, directed to recommend a plan to consolidate redundant post offices and other facilities. To stop implementation, Congress would have to pass a joint resolution disapproving the recommendations of task force.

We will see whether the House can withstand the constituent pressure on the closure and delivery issues.

DON’T HANG THAT POSTER YET
Last year, the National Labor Relations Board (NLRB) decided that you should post a poster informing your employees that of their workplace rights. The effective date was to be April 30th.

While the employer community expressed concern from the moment the proposal surfaced, it took a couple of court decisions for the NLRB to take notice.

The NLRB has suffered a series of setbacks in the court in cases challenging its authority to issue the poster requirement. As a result, the NLRB has announced:

“In light of conflicting decisions at the district court level, the DC Circuit Court of Appeals has temporarily enjoined the NLRB’s rule requiring the posting of employee rights, which had been scheduled to take effect on April 30, 2012.

“In view of the DC Circuit’s order, and in light of the strong interest in the uniform implementation and administration of agency rules, regional offices will not implement the rule pending the resolution of the issues before the court.”

HOUSE SMALL BUSINESS BILL
The House passed House Majority Leader Eric Cantor’s (R-VA) H.R. 9, the Small Business Tax Cut Act that would allow profitable small businesses to reduce their taxable income by up to 20 percent for one year. A small business is one with less than 500 full time employee equivalents for the purpose of the bill. The reduction is limited to not more than 50 percent of wages paid in the year.

SENATE SMALL BUSINESS BILL
Senate Majority Leader Harry Reid (D-NV) has his own ideas about a small business bill and says he will have the full Senate consider it soon.

S. 2237, the Small Business Jobs and Tax Relief Act would provide a one-time tax credit of up to ten percent of the incremental increase in wages paid by an employer in 2012 over 2011 wages. The incremental increase in the amount of wages eligible for the credit is capped at $5 million. His bill would also extend the temporary 100 percent depreciation bonus through 2012.  At the end of 2011, the temporary bonus dropped to 50 percent and it will expire at the end of the year.

It is hard to imagine the House considering the Senate bill (that is, if the Senate even passes the bill—it is not clear the Majority Leader can get the 60 votes needed to overcome a filibuster) or vice versa so, at the end of the day, this is an exercise in election year politics.

JUST IN CASE
The House Oversight and Government Reform Committee has approved H.R. 4067, a moratorium on “Midnight Rules,” introduced by Rep. Reid Ribble (R-WI). The bill would prohibit federal agencies from proposing or finalizing major “midnight rules” during an outgoing President’s lame-duck period. Under the bill, major rules are those that have an annual effect on the economy of $100 million or more; a major increase in costs or prices for consumers, individual industries, Federal, State, or local government agencies, or geographic regions; or significant adverse effects on competition, employment, investment, productivity, innovation, or on the ability of United States-based enterprises to compete with foreign-based enterprises in domestic and export markets.

We doubt the Senate majority will be inclined to embrace legislation that just happens to deal with the possibility of a lame duck president.

A Love Letter

It goes without saying that I am a big fan of PPAI.  I get excited to come to work each day and I fully embrace my role at the industry’s international nonprofit trade association.  Each day, the PPAI staff works hard to grow the viability, visibility, credibility and community of the promotional products industry, our member companies and hundreds of thousands of industry practitioners.

The fact that PPAI owns and produces The PPAI Expo – our industry’s largest, longest running and most successful tradeshow – is both a blessing and a curse. It is a blessing in that it, along with revenue generated through membership dues and media sales, provides the funding to do all the non-revenue generating activities the association must provide.  Activities such as awards, public affairs, government relations, product safety, research, professional development, regional support, strategic partnerships and buyer outreach – while all integral to building the viability, visibility, credibility and community of our industry – are not in themselves self-sustaining.

It is a curse, only in a matter of speaking, because The PPAI Expo is so dominant, some industry practitioners think it’s all we do.  But, it is truly the sum of the parts that sustain us and produce the growth we’ve enjoyed over the past 109 years.

I am pleased to share the attached “love letter” with you. It speaks specifically to PPAI’s value to the industry and why we’re so much more than a tradeshow.

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