Key Legislative and Regulatory Issues
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Updated: June 2010
INTRODUCTION
As summer begins, Congress seems totally focused on the oil spill in the Gulf of Mexico and not much else. The Senate is working on an "extenders" tax package that includes increased taxes for subchapter S corporations and their shareholders, a small-business tax relief bill which may include an estate tax fix and some other smaller bills. The House seems to be stuck in neutral. The immigration issue has calmed down a bit, but it will probably rise up again later this summer or in fall, just in time for the November elections. The financial reform bill is stuck in a House-Senate Conference Committee with no immediate hope of emerging. It now appears that the House Armed Services Committee will initiate an investigation – which will probably lead to hearings – into the Arlington Cemetery situation. Finally, confirmation hearings on Elana Kagan, the nominee to replace retiring Justice John Paul Stevens on the Supreme Court, will take center stage later this summer and will suck the oxygen out of anything else. All this points to a "lame duck" session after the November elections, during which Congress will have to pass a federal budget and any legislation they have not acted on prior to the election. We in Washington call this the "silly season" because no one knows what will happen. Surprises abound in these sessions because those who have been defeated in the election will have no need to be responsible to anyone anymore.With the recent results from primaries around the country, members of Congress are focusing more on their re-election campaigns than on legislation; they are running scared. This gives the NFDA Political Action Committee (PAC) an opportunity to really make a difference in the 2010 elections. There is an NFDA member from Florida running for Congress and the brother of another member running in Illinois. Other candidates who support funeral service are also running and have a fair chance of winning. In that regard, I would strongly urge all NFDA members to contribute to the NFDA PAC so we can have the resources available to help these and other candidates.
On the regulatory side, things have been rather quiet except for EPA's continued efforts to confirm that formaldehyde causes cancer and OSHA's increased inspections of funeral homes. TSA, working with NFDA and the airlines, has still not found an acceptable solution to the alarm resolution problem for screening human remains. We continue to work with all interested parties to resolve this issue.
As always, NFDA continues to be extremely active in all these arenas protecting and advancing the interest of funeral service and small business.
Click the links below to view information and updates on specific issues.For more information about any of these issues, contact NFDA's Advocacy Division staff:
- John Fitch, senior vice president, Advocacy Division, This e-mail address is being protected from spambots. You need JavaScript enabled to view it , 202-547-0441
- Lesley Witter, director of political affairs, This e-mail address is being protected from spambots. You need JavaScript enabled to view it , 202-547-0877
- Corey Eggers, coordinator, Advocacy Division, This e-mail address is being protected from spambots. You need JavaScript enabled to view it , 800-228-6332
| Legislative Issues |
| Regulatory Issues |
LEGISLATIVE ISSUES
Estate Tax (H.R. 4154). As part of the Family Business Estate Tax Coalition, NFDA is actively urging senators to support an amendment to be put forth by Sens. Jon Kyl (R-AZ) and Blanche Lincoln (D-AR) and tacked on to a small-business tax-relief package that the Senate will consider in the next few weeks. The amendment would establish a permanent estate tax exemption of $5 million and a tax rate of 35% for all amounts above the exemption. The amendment would index the exemption to inflation and include a stepped-up basis. The coalition placed an advertisement in congressional newspapers in mid-June urging them to support "meaningful estate tax reform....to help family businesses and farms to plan for success, not failure". We are doing everything we can to make this happen. NFDA members can send an e-mail to their members of Congress urging them to support estate tax reform via Congress-at-a-Click (requires member login).
Codification of SSI Irrevocable Funeral/Burial Trust Exemption. (S. 427/H.R. 1352). NFDA is working closely with sponsors of our bill in the House and Senate to devise a strategy to get it passed into law this year. In recent discussions with the staff of our Senate sponsor, Sen. Blanche Lincoln (D-AR), we identified a couple of legislative options dealing with expiring social security provisions which will be considered this fall and could be the best legislative vehicle on which to attach our bill. We will be working with Senate Finance Committee staff to clear the way, as well as making sure our House sponsors support the effort on their side. Passage of these bills continues to be a high priority for NFDA. Members can send an e-mail to their members of Congress urging them to support H.R. 1352 and S. 427 via Congress-at-a-Click (requires member login). [Back to Top]Subchapter S Corporations (H.R. 2910/S. 996). In the coming weeks, the Senate will consider the "American Jobs and Closing Tax Loopholes Act of 2010" (H.R. 4213). Section 413 of this bill would impose a payroll tax of 15.3% on subchapter S corporations on retained earnings in the business and the dividend distributions paid to employee-owners and family members who are shareholders/partners. Laudably, the provision is aimed at reducing subchapter S corporation owners from shifting income away from compensation to "dividends" that are not subject to payroll tax. However, taxing the retained earnings – the single biggest form of capital for small businesses – at a rate of 15.3% would decimate capital at a time when other funding sources remain difficult to access. Many NFDA member firms that are subchapter S corporations would be adversely impacted by this new tax.
Sens. Olympia Snowe (R-ME) and Mike Enzi (R-WY) have filed an amendment to H.R. 4213 to strike section 413 from the bill. NFDA and other small-business groups are actively supporting the amendment. As of this week, NFDA has learned that Senate Finance Committee Chairman Max Baucus, D-Mont., is putting together an alternative payroll tax provision to replace section 413. NFDA staff have not seen Baucus' proposal but believe it may not be a better solution for subchapter S corporations.
[Back to Top]Financial Product Safety Commission Act of 2009 (H.R. 3126).The differences between the House and Senate versions are now being worked out in a Conference Committee. Since a final version has yet to be agreed on, NFDA still does not know whether or not the consumer protection provisions of the bill will cover funeral and burial trusts or those who sell them. Stay tuned.
Bereaved Consumer's Bill of Rights Act of 2009 (H.R. 3655). There is still no indication when the bill will again be considered by the full House Energy and Commerce Committee. It was pulled from the Committee mark-up in May when an amendment to exempt non-profit religious organizations from the bill was offered by Reps. Phil Gingery (R-GA) and Jane Harman (D-CA). The bill sponsor, Rep. Bobby Rush (D-IL), pulled the bill because he opposed excluding religious organizations from his bill on the basis that they are entering into commercial transactions when they sell cemetery spaces, merchandise and other funeral or burial goods and services. He believes that consumers should be protected regardless of the organization from which they purchase these goods or services. We expect the bill will come back to the committee for consideration after this issue has been satisfactorily resolved, likely in late-June. NFDA members can send an e-mail to their members of Congress urging them to co-sponsor and support H.R. 3655 via Congress-at-a-Click (requires member login).
REGULATORY ISSUESFormaldehyde. We continue to monitor the activities of US EPA and the European Union on this issue, but so far they are still in the scientific review stages. In addition, the State of Massachusetts is working on a new formaldehyde rule and we have informed both the Massachusetts Funeral Directors Association and The Dodge Company of the situation and encouraged them to become involved in the process.
Shipment of Human Remains by Commercial Air Carriers. NFDA continues to meet with TSA officials and the airlines to try and resolve issues surrounding the development of a protocol for resolving security alarms that may be triggered during the screening process; if a shipment of human remains sets off a security alarm, the shipping container must be opened for a physical inspection. This continues to be a real issue for all involved. Numerous solutions have been proposed by NFDA, the airlines and TSA but none seem to be acceptable to all parties involved so the negotiations continue. In addition, NFDA is pursuing alternative options which, hopefully, will solve the problem, but even those negotiations will be difficult. NFDA is actively pursuing all avenues to solve this very serious problem. Stay tuned.
TSA and airline officials briefed Advocacy Summit attendees on the requirements of this new program. A video of this briefing, as well as the latest news and information about these regulations, can be found on the NFDA Website, www.nfda.org/tsainfo.
OSHA. OSHA and their state partners seem to be ramping up their inspections of funeral homes for compliance with the Hazardous Communication, Bloodborne Pathogen and Formaldehyde Standards. We will keep a close eye on this effort and intercede where necessary. In the meantime, NFDA members are strongly urged to ensure they are in full compliance with all these standards.
