Current trends and legislation affecting small business.
Keep your calendar open for another White House Conference on Small Business in early 1994. John LaFalce (D-N.Y.) has introduced a bill proposing the conference, at which delegates from small companies would draft recommendations for Congress and the President; state conferences would precede it in 1993. The bill seeks $5 million for administration; as in previous conferences, participants would pay their own way.
Looking for information about exporting? Two new toll-free numbers offer basics to small companies. One, (800) 243-7232 (800-244-7232 in Massachusetts), is operated by the Small Business Foundation of America. The other, (800) USA-EXPORT, is run by consultants at International Strategies; it is available only in Massachusetts but, if successful, will be expanded nationwide. With big-company sponsorship, both offer free basics and referrals; both have relationships with for-profit companies with more in-depth data -- for a fee.
A new workers' compensation formula will increase small companies' incentives to reduce claims. This is the first major revision in more than 20 years. In general, smaller companies with good safety records will do comparatively better on premiums; those with bad records comparatively worse. The formula comes from the National Council on Compensation Insurance, which is involved in rate setting in 37 states; 17 states will have switched by September. Consultant John Lewis warns of possible opposition, however -- some large companies with good records will suffer.
Small-business lobbyists aren't wild about proposed legislation to replace Internal Revenue Code Section 2036(c) but admit it's a step in the right direction. Passed in 1987, 2036(c) curtailed the estate-freeze method of reducing taxes when passing a family business to heirs; without the freeze, owners feared estate taxes would wipe out their companies. Legislation before the House restores the freeze but adds stipulations to make sure enough gift taxes are paid when owners pass on control. "It's complicated and it's overly broad," says John Carson of the U.S. Chamber of Commerce. But some form of freeze legislation is expected to pass this session.
The latest trend in corporate wellness programs: giving employees breaks on their portion of health-insurance premiums if they don't smoke or aren't overweight. A handful of companies figure that the higher claims of smokers and the overweight more than justify the discounts. One example: Warren Distribution, in Omaha, requires its 300 employees to pay 25% of their premiums, but it now lowers that 7.5% for nonsmokers and 7.5% for those within a recommended weight range.