The old saying “The world is run by those who show up” could not be more true or more meaningful than right now. Those who show up in Washington, DC, next month for the 10th Annual IFA Public Affairs Conference September 14-15 will be in the driver’s seat when it comes to voicing the franchise industry’s concerns about key legislation.
September promises to be a critical month for franchising as Congress considers the union “card check” legislation, health-care reform, and access to capital – issues critical to the future of franchising. If we don’t voice our concerns and opinions now, bills will be passed that add new costs for franchise businesses – and the industry’s economic recovery will take longer and be more difficult.
Here are just few issues that Congress is considering.
Card Check: The so-called “Employee Free Choice Act” would take away a worker’s right to a federally supervised private ballot when deciding whether to join a union. It would replace the private ballot with a scheme called “card check,” which allows a union to organize if a majority of workers simply sign a card. Under this system, paid union organizers – not the federal government – oversee the process.
Passage of the bill will reduce incentives to grow franchised businesses in the U.S., and will render existing franchises less competitive in a challenging economy.
Health Care: Some proposals currently being debated in Congress put the cost of the reform squarely on the backs of the business community, and small and franchised businesses will likely bear a big share of the burden. Under health-care proposals currently being debated, employers would have to pay for a basic level of coverage for full-time employees and pay for at least some of the costs for part-time employees. If a business did not meet the minimum coverage, it would be required to pay the federal government a tax based on its payroll, with exemptions for a certain category of small businesses (yet to be fully defined).
In preliminary data gathered by the IFA, when asked to gauge the impact of the health-care reform proposal on their businesses, 25 percent of franchisors said that the current health reform legislation would threaten the economic viability of their system, and 43 percent of franchisees said that passage of the bill as it’s written would threaten the economic viability of their store.
IFA is advocating for measures to help businesses help their employees, such as targeted tax credits or tax rebates that offset the cost of offering or maintaining health benefits. IFA is urging Congress to allow small employers to pool together to offer health insurance to their employees through either the employer’s membership in an association, or association-like group (such as a franchise system), or at a state level. We need a truly market-based health-care program that lowers costs, creates real competition and preserves and produces jobs, not destroys them.
Credit Access: IFA is urging members of Congress to promote more lending and less government spending to help franchise businesses find new capital to foster development, creating more jobs and economic activity. Congress should make further changes, even temporarily, to SBA programs, including increases in the dollar amounts for SBA 7(a) loan guarantees to accommodate the needs of larger and midsize small businesses. Congress should increase the standard 7(a) maximum loan limit from $2 million to $4 million and increase the maximum guarantee amount provided to $3.6 million, consider examining a market-based loan pricing model for the SBA loan programs, and entirely rescind the SBA’s newly established cap of $250,000 on goodwill financing while data is gathered to determine if any changes are needed.
Give us 36 hours and we’ll give you a voice in Washington.
These and other issues will be the key topics that attendees of the Public Affairs Conference September 14 -15 will discuss with members of Congress. The more people who attend, the more impact we can have on the outcome. If you make a living in franchising, you need to participate in the policy-making process.
During the 36 hours, you’ll hear directly from insiders about health-care reform, “card check” and solutions for easing the lack of available credit. Nationally syndicated columnist George Will will provide penetrating and incisive commentary on the Washington political scene. During his speech, “The Political Argument Today,” this Pulitzer Prize-winning columnist and Newsweek essayist will offer a glimpse into what the future holds for public affairs, public policy and American society.
Last year, attendees helped make a difference with a strong message against the card check bill, and we can report that the prospects for passing the Employee Free Choice Act grow dimmer every day. With more help this year, we can stop it once and for all. And finally, policymakers need to know that the sooner access to capital is opened up, the sooner franchised businesses can help start the economy on the way to a lasting recovery.
Now, more than ever, the success or failure of franchised businesses hinges on the decisions of lawmakers in Washington. We all can make a difference. This could be the most important 36 hours of the year.
Dina Dwyer-Owens is chairwoman of the International Franchise Association and chairwoman and CEO of The Dwyer Group.