Will State Lawmakers Heed New SBA Data, Small Business Concerns?

Jan. 26, 2012

There’s more evidence that small business plays a pivotal role in creating jobs in Washington and other states, according to the Office of Advocacy in the Small Business Administration (SBA). The Office of Advocacy released small business data for each of the 50 states.

SBA believes the new data is “an invaluable resource for small businesses, legislators, academics, government officials, and policymakers in each state.”

Why?

“Small businesses are the foundation of economic growth in Washington and in our nation” said Dr. Winslow Sargeant, Chief Counsel for Advocacy. “By supporting policies that promote innovation and entrepreneurship, we help small businesses tackle these challenging economic times. These statistics are a resource for a path to economic growth.”

As for Washington state, the report explains “small business employment; business starts and closings; bank lending; business ownership by minorities, women, and veterans; and firm and employment change by major industry and firm size.”

Salient data about small business:

  • There were 532,162 small businesses in Washington in 2009. Of these, 142,854 were employers and they accounted for 53.3 percent of private sector jobs in the state. Small firms made up 98.1 percent of the state’s employers.
  • Throughout 2010, the number of opening establishments was lower than closing establishments and the net employment change from this turnover was negative.
  • Washington’s real gross state product increased 0.7 percent and private-sector employment decreased 1.8 percent in 2010. By comparison, real GDP in the United States decreased 1.3 percent and private sector employment declined by 0.8 percent.
  • Self-employment in Washington surged over the last decade. Female self-employment fared the best compared with other demographic groups during the decade.

To promote entrepreneurship, this week the Washington Policy Center sent state lawmakers in the 2012 legislative session these recommendations:

  1. Revisit the voluntary settlement agreement as passed by the state Senate in 2011 – $1.2 billion
  2. Reform the displaced worker retraining program
  3. Simplify sales taxes by using an ‘origin based’ tax (as opposed to a ‘destination based’ tax) and creating a flat rate for out-of-state businesses
  4. Review regulations to ensure that Washington rules don’t exceed federal regulations
  5. Enact Tort Reform
  6. Do no harm in transportation policy – do not reduce road lane capacity
  7. Do not follow Seattle in enacting statewide paid sick leave

In addition, Gov. Gregoire suggested her strategies to aid small business — business and occupation tax relief.

How has the Legislature responded? Lawmakers have ignored their $1.5 budget-deficit crisis.

Instead, lawmakers are considering other matters – mandating paid sick leave and safe leave, banning plastic bags, abolishing the death penalty and gay marriage.

When will Washington’s Legislature demonstrate wisdom?

From the Coach’s Corner, also read:

WPC Hits Target, but Will Washington State Legislature?

Washington: A Balanced Budget Is No Longer Enough

Does the Federal Reserve Understand Small Business?

Knowledge is knowing a tomato is a fruit.  Wisdom is not putting it in a fruit salad. 

_______

Columnist Terry Corbell is also a business-performance consultant and profit professional. Click here to see his management services (many are available online). For a complimentary chat about your business situation or to schedule Terry Corbell as a speaker, why don’t you contact him today?

Agency Provides Help for Small Business to Cope with Federal Government


If you’re a small business owner, most likely you’re feeling the pain of overzealous regulation by government.

Small business owners feel the pain – losses in time and money – more readily that management in large companies. They’re closer to the cash register and have fewer resources – especially, micro businesses.

That means, in general, they’re more fiscally conservative and more likely to implement change to improve their cash flow.

In my experience, depending on the locale, the majority of small businesspeople complain of bureaucrats that make profits hard to achieve.

free stock photo Suit, Male, Ties, Work

Even a federal agency agrees, according to published reports. The Office of Advocacy at the Small Business Administration (SBA) states that federal rules cost business $1.1 trillion. And it costs small businesses 45 percent more than big businesses to comply.

That costs jobs.

So the SBA’s office says it’s been doing something about it with its regulatory review and reform initiative; what it calls “r3” to target regulations that are “ineffective, duplicative, or out of date.”

In 2008, it received 82 nominations for onerous rules that need reform. After two years of study, it whittled down the list. In 2010, it decided to focus on 10 federal rules that need revision.

“Only 10?” you’re thinking. Well, just as it took the SBA two years to decide on 10 finalist rules, getting government to reform anything takes years. So let’s congratulate the agency for its efforts.

In difficult situations, a positive attitude works wonders. The place to start is to chart progress. It’s a healthy exercise to focus on what’s right than on what’s wrong. Relish your progress. So regarding the 10 rules, let’s try to appreciate how far the agency has come.

Here’s a tip of the Biz Coach cap for the 10 federal rules:

  1. Update Air Monitoring Rules for Dry Cleaners to Reflect Current Technology
  2. Flexibility for Community Drinking Water Systems
  3. Simplify the Rules for Recycling Solid Waste
  4. EPA Should Clearly Define “Oil” in its Oil Spill Rules
  5. Update Flight Rules for the Washington, DC, Metropolitan Area
  6. Eliminate Duplicative Financial Requirements for Architect-Engineering Services Firms in Government Contracting
  7. Simplify the Home Office Business Deduction
  8. Update MSHA Rules on the Use of Explosives in Mines to Reflect Modern Industry Standards
  9. Update OSHA’s Medical / Laboratory Worker Rule
  10. Update Reverse Auction Techniques for Online Procurement of Commercial Items

Do you have questions, concerns or comments? Here’s an e-mail address: advocacy@sba.gov.

I say keep it going. If state and local governments would only see the light.

From the Coach’s Corner, does your small business need economic data or research? Try this article: Strategic Planning: List of Informative Web Sites

“Government is not a solution to our problem, government is the problem.”

-Ronald Reagan


__________

Author Terry Corbell has written innumerable online business-enhancement articles, and is a business-performance consultant and profit professional. Click here to see his management services. For a complimentary chat about your business situation or to schedule him as a speaker, consultant or author, please contact Terry.





How Healthcare Law Would Affect Small Business

 

Updated May 14, 2010

Some 350,000 small business advocates have joined the legal fight against the healthcare law. They are members of the National Federation of Independent Business. The so-called healthcare reform pushed by Congress and the Obama Administration has caused more angst for small businesspeople than any issue in recent memory. For fiercely independent entrepreneurs, there are questions of socialism and constitutionality. They see a further deterioration in the makeup of the United States.

They’re grateful to the 14 state attorneys general who are fighting the law’s constitutionality. Republicans are hoping for enough votes for their candidates in the November elections to mount a revocation drive when Congress reconvenes in 2011.

Meantime, if the law is allowed to stand, it’s important for small businesspeople to understand how they’re affected. For starters, make sure you convert from a sole proprietorship to a limited liability partnership or corporation.

There would be no limits on premium rate hikes before 2014.

If you have 50 more employees, the government would fine you if you don’t provide coverage to your workers. Employers with less than 50 workers are exempt.

However, personal coverage is mandatory.

There would be 19 new taxes.

Generally, indigent self-employed are likely to get Medicaid. You can’t be denied insurance if you have a pre-existing condition.

Starting with your federal tax filing for 2010, employers with 25 or fewer workers that pay half of the workers’ premiums would get a 35 percent write-off. If employers purchase health insurance through an exchange beginning in 2014, they’ll receive a 50 percent deduction for healthcare premiums on their tax returns.

To save money, companies with as many as 100 workers can join a pool – Small Business Health Options Programs (SHOP). It’s hoped that such SHOP exchanges will enable a lower of premiums.

Federal subsidies would be available to the self-employed for healthcare who earn up to 400 percent of the federal poverty level. Subsidies would be available to families of four earning as much as $88,200.

Dependent children – up to the age of 26 – would be covered on their parents’ policy.

Beginning in Sept. 2010, insurance coverage would include a lot more than basic catastrophic coverage. Preventative care must be included.

For individuals earning $200,000 and families making $250,000 beginning in 2013, the Medicare rates will increase from 1.45 percent to 2.35 percent. For businesspeople getting capital gains, dividends or interest income, there will be an extra 3.8 percent tax.

Lifetime maximum limits on insurance policies would be outlawed.

Finally, regarding the so-called “Cadillac” plans, companies that pay more than $10,200 for individuals or $27,500 for families would be required to pay another 40 percent in the form of a tax. Naturally, this would be a huge hit to many small businesses.

My sense is that the so-called healthcare reform is a denunciation of individual economic and political freedom. And I fervently believe there are grounds to over-rule the law on constitutional grounds.

From the Coach’s Corner, in conjunction with April being “National Financial Literacy Month,” the Small Business Administration is offering entrepreneurs free webinars on its Web site to learn fiscal fitness.

Seattle business consultant Terry Corbell provides high-performance management services and strategies.