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Government Relations Report

Government Relations Report. Health Care. Signed into law 3/30 Important dates for franchisees: 2014: Employer requirements begin 3/1/13: Notification to employees required Exemptions: Employers with less than 50 full-time equivalent employees (FTEE’s). Health Care: Requirements.

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Government Relations Report

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  1. Government Relations Report

  2. Health Care • Signed into law 3/30 • Important dates for franchisees: • 2014: Employer requirements begin • 3/1/13: Notification to employees required • Exemptions: • Employers with less than 50 full-time equivalent employees (FTEE’s)

  3. Health Care: Requirements • Employers must provide “minimum essential coverage” • Covers “essential health benefits” • Limits cost-sharing (deductibles) • Has an actuarial value of at least 60% • Further clarification will be provided by U.S. HHS via regulation

  4. Health Care: Calculations • How to calculate who is covered: • Determine if you have 50 or more full-time equivalent employees (based on 30 hour work week) a. Ex. – 2 part-time employees working 15 hours each = 1 full time employee • If >50, you must provide health insurance to your actual full-time employees only • No penalties for not providing health care to the first 30 actual full-time employees

  5. Health Care: Penalties • Do not offer coverage AND have at least one F/T employee who uses a tax credit • $2,000 per full-time employee per year (first 30 waived) • Offers coverage but at least 1 F/T employee uses the tax credit • $3,000 per each employee receiving tax credit • Not to exceed $2,000 x FTE’s (above) • Offers coverage but FTE’s contribution is 8-9% of income • Employer must offer voucher to avoid penalties

  6. Health Care: Next Steps • HHS and IRS already have “guidance” on their websites • HHS: Group Health Plans and Health Insurance for children up to age 26 • IRS: Small business tax credit • July 2010: HHS must create a website with information for consumers and small business • Everything must be completed by 2014: • HHS • Treasury • DOL

  7. Credit Card Interchange Bills • Credit Card Fair Fee Act • Requires credit card companies to negotiate directly with merchants to lower interchange rates.  • Hearing in April - No vote taken • Credit Card Interchange Fees Act • Allows merchants to: • Provide discounts for other types of payments • Set minimums/maximums for cc purchases • FTC oversight and required transparency

  8. Credit Card Interchange Fees – Financial Services • Mid-May: Sen. Durbin (IL) introduces interchange amendment to financial reform bill which: •    Requires Fed to issue regulations where interchange fees are "reasonable and proportional" to the cost • Disallows anti-competitive restrictions placed by Visa and Mastercard. • Allows merchants to offer discounts for competing cards and cash, checks or debit cards and set minimum and maximum transaction amounts. • Provides exemption for small banks

  9. Credit Card Interchange Fees – Financial Services • 5/13: Amendment passes • 5/20: Bill passes out of Senate • Next steps: • Conference committee • Note: Interchange is NOT in House version and strong opposition to keep it out! Stay tuned for an Action Alert!

  10. Paycheck Fairness Act • Provisions: • Requires a higher “business necessity” standard on employers to prove no bias in any pay discrepancies • Cannot pay employees differently based on market forces, negotiating ability, past salary or the amount of revenue generated • Provides for unlimited "punitive and compensatory" damages for pay discrimination • Trial Lawyers benefit; Employers suffer    

  11. Paycheck Fairness Act • Status: • Passed out of the House in January 2009 with Ledbetter bill (now law) • In Senate, 42 co-sponsors – need 60 to pass • Senate looking for post-health care “win” prior to elections • No vote scheduled – may come up quickly

  12. Hiring Incentives to Restore Employment Act ("HIRE Act") • Signed into law 3/19/10 • Payroll Tax Holiday: • Employers exempt from paying SS payroll tax • Up to taxable wage of $106,800 • Employees must be hired after 2/3/10 and before 1/1/11 • Up to taxable wage of $106,800 • Applies to wages paid from March 18, 2010 through 2010

  13. Hiring Incentives to Restore Employment Act ("HIRE Act") • Tax Credits • For employees retained for at least one full year. • Employers can claim a credit for "retained workers" • Credit calculation: • The lesser of $1,000 or 6.2 percent of the wages paid to the employee for the year on their 2011 income tax returns. • Wages during the last 26 weeks of employment > at least 80% of wages during the first 26 weeks.

  14. Hiring Incentives to Restore Employment Act ("HIRE Act") • For both holiday and credits, employees must be “qualified” • Unemployed or working part-time (less than 40 hours a week) for at least the past 60 days; • Not a family member or other relative of the employer; • Fills either a new position or a position that was vacated voluntarily or for cause.

  15. Hiring Incentives to Restore Employment Act ("HIRE Act") • Small Business Expensing • Section 179 of the IRS Tax Code • Can deduct the full purchase price of financed or leased equipment placed into service in 2010 • Maximum from $125,000 to $250,000 through 2010. • Employer and employee must complete new form W-11 • Guidance and Form on IRS website

  16. Immigration • Schumer-Graham bill • Graham – tabled until 2012 – focused on climate change bill • Other • Leader Reid wants to tackle “this year” • Working with Sen. Menendez • Timing: • Will start in Senate - Judiciary • More likely June than July • Most likely 2012

  17. Employee Free Choice Act (“Card Check”) • 3/27/10 – President Obama recess appointment of Craig Becker to NLRB • Associate General Counsel for AFL-CIO • 2/9/10 Senate vote – nomination rejected • Concerns raised about administering Card Check w/o bill’s passage • Binding arbitration and secret ballot cannot be imposed administratively

  18. Building Depreciation • American Jobs and Closing Tax Loopholes Act • One-year extension of 15-year depreciation schedule (from 39 ½ years) likely included • Applies to: leasehold improvements, restaurant improvements and new construction and retail improvements. • Current extension expired 12/31/09 • Issue: costly – need “pay fors” – Chairmen Baucus/Levin looking for income sources • Permanent Extension – Meek/Tiberi bill • Recent push to increase co-sponsors

  19. Cap and Trade - “American Clean Energy and Security Act” • Provisions: • Limits greenhouse gases through declining cap on allowable emissions • Must be down 17% from 2005 levels by 2020 • Must be down 80% by 2050 • Companies must obtain a permit for every ton of C02 emissions • Permits are tradable • # of permits decreases every year → increased energy prices

  20. Cap and Trade Legislation • Impact • Increase in gas, oil, electricity • Decrease in consumption • Loss of millions of jobs • Jobs shipped overseas • Status: • 6/26/09: Passed House - 219-212 • Blue Dog Coalition concerned of cost – 30 voted against/20 in favor • Senate considering (Sen. Boxer – sponsor) • More of a priority before Reid’s announcement to focus on immigration

  21. SAVE THE DATE! 2010CFA DAY FORUM July 15-17, 2010Gaylord NationalWashington, DC

  22. 2010 CFA Day Forum Basics • Date: • July 15-17, 2010 • Location: • Gaylord National- Washington, DC • Schedule of Events: • Thursday, July 15, 2010Educational Session on Legislative Issues Keynote speaker George Will Cocktail Reception Exhibit Hall • Friday, July 16, 2010 Breakfast Hill Visits General Session Gala Dinner Event with guest speaker Sam Donaldson • Saturday, July 17, 2010Depart • Registration Fee: • Franchisees: $1,000/Guests: $300 • Includes registration, materials, meals and receptions, two nights at the Gaylord – register at www.thecfainc.com/event.html

  23. Mission Statement: To Leverage the collective strengths of Franchisee Associations for the benefit of the Franchisee Community

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