Time to end the dangerous shell game

The Hill's Congress Blog
August 28, 2013

By Frank Knapp Jr.

Iran heads the list of countries the United States and other nations have targeted for sanctions because of its believed nuclear weapons goal and its support of terrorist groups. There are few governments that elicit more concern among Americans than the one in Tehran.

Certainly no law-biding U.S. citizen or business would provide goods or services directly to Iran or any organization that funnels money to that regime. In fact, it is illegal to do so. But that is exactly what has happened and likely is still happening because it is perfectly legal in the U.S. to set up anonymous shell corporations--secretive entities often exploited by criminals to move dirty money

Before 2009, companies renting office space in a skyscraper at 650 Fifth Avenue in New York were unknowingly sending money to the Iranian government. If you were shopping in the retail businesses in that building, you were unwittingly financing the Iranian government.

You wouldn’t have known that you possibly were contributing to Iran’s nuclear weapons program because an anonymous shell company was set up to disguise that Bank Melli co-owned the building and collected the rent, according to court documents. The Iranian government owns and controls Bank Melli.

Federal agencies discovered the corporate shell game and the matter is now in the courts.  Fortunately that particular revenue stream to Iran has stopped.

But how many other shell companies are used to financially benefit enemy states because U.S. state laws don’t require the identity of owners to be disclosed? How many are used by drug traffickers, terrorist cells, tax cheats, pimps, arms traders, fraudsters or other criminals to further illegal activity? How many American dollars are secretly sent to groups most of us would never support?

Because of legalized corporate secrecy, we don’t know the answers to these questions.

In many states it is easier to incorporate a business than to get a driver’s license. Very few states require that the ultimate owner or owners of a business be listed on the incorporation form. Imagine applying for a driver’s license without having to reveal your identity. Yet every day in America, businesses are created without any obligation to provide this basic information.

I spoke with the person in charge of business filings in South Carolina. She acknowledged that, like almost all other states, the law does not require the state to collect information about the identities of the real persons that own or control a business. Remedying this problem might be of interest to her agency, she told me.

A state-by-state effort, however, probably wouldn’t succeed because a state like Delaware, which intentionally has notoriously lax corporation filing requirements and collects substantial revenues from incorporations, has a financial incentive to resist such efforts. If even one state remains a haven for corporate secrecy, a state-by-state solution fails.

Congress can fix this problem. The bipartisan Incorporation Transparency and Law Enforcement Assistance Act (ITLEAA) is a common sense solution that would require companies to disclose the names, addresses, and driver’s license or passport numbers of the real people who ultimately own or control them. This would make it harder for criminals to exploit the U.S. system to hide and finance their activities.

The ITLEAA lets states decide whether to make this information public or to only make it available to law enforcement with a subpoena. States can choose to respect the privacy of business owners by not requiring their personal information be made public. Yet it is difficult to overstate the importance of this information to local, state and federal law enforcement authorities engaged in pursuing criminals who currently count on anonymity to mask their illegal actions. Complying with ITLEAA would not be a significant regulatory burden on small business owners.

The U.S. Department of Justice and the Treasury Department believe this is so important, they have offered $40 million in forfeiture funds they’ve seized from criminal activity to help states with any cost of complying with the law.

No Main Street small business or consumer wants to inadvertently support an anonymous shell corporation that is laundering money, supporting terrorists, or funneling money to enemy governments. The ITLEAA will help make sure that this doesn’t happen.

Knapp is the president & CEO of the South Carolina Small Business Chamber of Commerce and chairman of the American Sustainable Business Council Action Fund.

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Read the speech

Take the time to read the full text of the Reverend Martin Luther King Jr.'s speech from 50 years ago today.  It's only 5 1/2 pages.  You can find it here.

The Tom Coburn woolly mammoth project

A soon to be released United Nations report will say that scientists have 95% certainty that humans are the principle driver of our warming planet.  Scientists aren’t arguing about whether the Earth’s atmosphere is warming.  The melting glaciers and thermometers don’t lie. 

But yet all the physical signs of climate change don’t point to increases in temperatures according to one scientist.

“I am a global warming denier. I don’t deny that,” said Tom Coburn, a Republican U.S. Senator and physician on Monday.

So what do all the physical signs of warming really mean according to Coburn?

A “mini ice-age”, he says.

Yep.  We better hurry up and clone the woolly mammoth.  We’re going to need it for food soon.

Small Business v. Personal Credit Cards: How They're Different

ABC News
August 24, 2013

By ODYSSEAS PAPADIMITRIOU, CEO of CardHub

> When Rep. Nita Lowey, D-N.Y., introduced the Small Business Credit Card Act of 2013 to Congress back in June, she was attempting to right a wrong that has persisted since the original CARD Act took effect in October 2010.

The landmark law, which has increased transparency and bolstered consumer rights throughout the credit card industry, does not apply to credit cards branded for small business use. And while Lowey's bill has the potential to correct this oversight, it has only a 1 percent chance of being enacted, according to GovTrack.

The roughly 37 percent of small business owners who leverage credit card debt each year must therefore learn how to get by without important legislatively provided rights if they wish to achieve debt stability and avoid losing money. CardHub conducted a study analyzing the small business credit card policies employed by the nation's 10 largest issuers, and the five major takeaways are listed below.

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Workgroup for Safe Markets launches new website

My friends at the Workgroup for Safe Markets have launched a new website that you might find interesting.  Go to http://www.safemarkets.org/.  

The Workgroup for Safe Markets is a US-based collaborative of groups united by a common concern about hazardous chemicals in our homes, our bodies and our environment; and a common vision of a cleaner, healthier economy. These groups are leading the effort to protect our families and communities from the devastating impacts of toxic chemicals, and to shift the economy to safer products and practices. The Workgroup for Safe Markets is part of the Coming Clean collaborative, which hosts leading environmental health and justice experts who are working to reform the chemical and energy industries so they are no longer a source of harm. For more information, visit www.ComingCleanInc.org.

Clearly identifying toxic chemicals in products small businesses use and sell to customers is important.  Protecting the health of our employees, customers and ourselves is a goal we should strive to achieve.  And if we can do that while at the same time creating jobs through the development of safer chemicals to replace the toxic ones, we improve our economy also.

Where do we go from here? Congaree Vista Development Symposium – 2013

Thirty years ago Columbia embarked on its most ambitious re-development effort ever – seeking to renew and rehabilitate a long neglected city warehouse district located near the downtown urban core. These efforts paid off and many small businesses have turned the Vista into a vibrant area of retail shopping, restaurants and entertainment.  The Vista is Columbia's premier redevelopment success story.

SC Small Business Chamber of Commerce will host a public forum Thursday, August 22, 9-11 AM at the Hilton Columbia Center Hotel. This forum will explore the history of the Vista redevelopment, examine the City of Charleston’s ongoing renewal efforts, and discuss steps forward for continuing the development of the Columbia’s Vista.

The event is free and open to the public, although advance registration is suggested.

Featured Guests:

• Tim Keane, Director of Planning, Preservation & Sustainability for the City of Charleston
• Fred Delk, current Executive Director of the Columbia Development Corporation
• John Fellows, Planning Administrator for the City of Columbia
• Rosie MacFarlane Craig, developer and owner of two historic Vista properties

Moderator: Frank Knapp, Jr., President & CEO, South Carolina Small Business Chamber of Commerce

To register for the Symposium send an email to sbchamber@scsbc.org.

For More information, contact Frank Knapp at 803-252-5733.

 

You’re invited to hear Bill McKibben in Charleston

The South Carolina Small Business Chamber of Commerce is pleased to co-sponsor a free lecture by Bill McKibben in Charleston on October 16^th at 6PM.   McKibben is the founder of 350.org and has been called by Time Magazine “the planet’s best green journalist”. 

The title of the lecture is “The Climate Heats Up” and it comes just months after the Small Business Chamber launched our sea level rise education project (www.scbars.org) along the S.C. coast.  There is no bigger threat to the state’s small business coastal tourism industry than rising seas resulting from climate change.  If the nation doesn’t take significant steps soon to transition to a clean energy economy, the cost to the state and cities to deal with a sea level rise of up to 6 feet or more by the end of the century will be astronomical.  However, even with such a mammoth and expensive effort of resilience our coastal tourism economy will suffer immensely.

The Small Business Chamber has 10 reserved seats for the McKibben lecture that will otherwise be general seating with no reservations.  If you would like to join us in our reserved seating area, please email me at sbchamber@scsbc.org. 

Details for the event are as follows:

What: Bill McKibben Lecture: "The Climate Heats Up"

When: Wednesday, October 16, 2013 at 6pm

Where: Physician's Auditorium on the College of Charleston Campus, 66 George St., Charleston, SC

Doors will open at 5pm.  Limited general seating is available, so please plan to arrive early.  

65 Percent Isn't Enough And Job Creation Is Suffocating

The South Carolina Small Business Chamber is making steady progress on setting up a donation and investment crowdfunding portal to give small businesses and entrepreneurs another means to access capital.  To find out more click here.

Below is an excerpt from an opinion editorial in Forbes by Ty Kiisel that addresses the issue of capital access.

Unfortunately, partially because of the way the SBA defines small businesses, traditional small business lending has moved upstream since 2008 and is catering to the bigger businesses on the small business continuum. The average 7(a) loan amount in 2012 was far more than what those Main Street business owners are looking for to grow their businesses and create jobs.

We recently pulled a sampling of about 44,000 borrowers who visited our platform during the first six months of 2013 and 59 percent of those business owners were looking for small business loan amounts of $50,000 or less—39 percent were seeking loan amounts of less than $25,000.

As credit tightened following the financial meltdown and the community banks and other traditional lenders small business owners would have turned to 10 years ago collectively turned them away, access to the inexpensive capital small businesses rely on to grow and hire employees dried up—leaving the nation’s biggest employer [small business] out in the cold.

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SC Small Business Chamber of Commerce to Host Congaree Vista Development Symposium 2013

Found—the thousands of new jobs promised from Keystone XL pipeline

How many new jobs might be created if the Keystone XL pipeline is built from Canada to the Gulf Coast for the purpose of carrying the dirtiest, carbon-saturated oil in the world for refining into fuel? This has been a perplexing question. 

TransCanada, the would-be builder of the approximately 2000 mile long pipeline, has claimed 20,000 new jobs.  The U.S. State Department estimates that the construction might create less than 4,000 temporary jobs and only 35 permanent jobs. 

How can this significant discrepancy in predictions be explained? Here is the obvious answer.

The State Department had too narrow a definition of a new job created by the pipeline.  It’s not just how many workers are involved in the construction and operation.  TransCanada and other supporters of the pipeline are also counting all the jobs needed to clean up the mess from the inevitable oil spills.

The New York Times ran a story yesterday that tells about recent pipeline oil spills that take years and tens of millions of dollars to clean up.

It has been three years since an Enbridge Energy pipeline ruptured beneath this small western Michigan town, spewing more than 840,000 gallons of thick oil sands crude into the Kalamazoo River and Talmadge Creek, the largest oil pipeline failure in the country’s history. Last March, an Exxon Mobil pipeline burst in Mayflower, Ark., releasing thousands of gallons of oil and forcing the evacuation of 22 homes.

Both pipeline companies have spent tens of millions of dollars trying to recover the heavy crude, similar to the product Keystone XL would carry. River and floodplain ecosystems have had to be restored, and neighborhoods are still being refurbished. Legal battles are being waged, and residents’ lives have been forever changed.

“All oil spills are pretty ugly and not easy to clean up,” said Stephen K. Hamilton, a professor of aquatic ecology at Michigan State University who is advising the Environmental Protection Agency and the state on the cleanup in Marshall. “But this kind of an oil is even harder to clean up because of its tendency to stick to surfaces and its tendency to become submerged.”

These massive cleanup operations will directly hire workers that are sure to be high-paying jobs with long-term security given the spillage record of pipelines.  In addition there will be thousands of jobs created in the construction industry to build new homes for displaced families and to deconstruct the homes adjacent to the oil spill.  Then there are all the jobs needed for the increased demand for relocating folks.  And we know that people like to buy things for a new home so retailers will need more employees, manufacturers will have more goods to produce and so on and so on.

There is the explanation for the different predictions of new jobs from constructing the Keystone XL pipeline.  The State Department was just not counting all new jobs.  The real short-term employment growth is in the aftermath of the TransCanda-expected oil spills from the pipeline.

 

Pollution Economics

The New York Times
August 10, 2013

By DIRK FORRISTER and PAUL BLEDSOE

WITH more than a million people in China dying prematurely each year from breathing its dirty air, and with warming temperatures portending rising sea levels and disruptions to food production, the centrally planned Communist country is experimenting with a capitalist approach to address the problem: it is creating incentives so that the market — and not the government — will force reductions in emissions.

The United States invented this approach in the 1990s to deal with acid rain. The effort was tremendously successful in reducing sulfur dioxide emissions that were poisoning lakes and streams, contaminating soils and accelerating the decay of buildings, at a cost lower than even its advocates anticipated.

But the United States has taken a policy detour that has hurt its efforts to reduce greenhouse gases. Congress has spurned the cap-and-trade approach China is trying, even though it is widely recognized as a cheaper way to lower emissions. As a result, President Obama has had little choice but to turn to government regulation to reduce these pollutants. Consumers will pay a higher price for electricity as a consequence.

China, the world’s largest emitter of carbon dioxide, has begun its effort in the southern city of Shenzhen, paving the way for a national Chinese market in a few years. Like Europe, which voted to extend and improve its emissions market, and Australia and New Zealand, Shenzhen chose a carbon market as the most efficient way to lower its greenhouse gas emissions.

Under the Shenzhen program, the government will set limits on carbon dioxide discharges for 635 industrial companies and 197 public buildings that together account for about 40 percent of the city’s emissions. Polluters whose emissions fall below the limit can sell the difference in the form of pollution allowances to other polluters. These companies must decide whether it is cheaper to reduce emissions or pollute above their limit by buying allowances, whose price will be set by supply and demand. But the pressure will be on, because the limits will decrease over time. Six more regional pilot programs are planned over the next year.

More than 20 percent of global greenhouse gas emissions are now subject to carbon pricing systems. About 60 other states, provinces or countries are considering similar approaches, according to a recent World Bank report.

Carbon cap-and-trade programs align environmental goals with market incentives. Conventional regulatory approaches “cannot ensure achievement of emissions targets, create problematic unintended consequences, and are very costly for what they achieve,” says the economist Robert N. Stavins, director of the Harvard Environmental Economics Program.

So how did America detour away from emissions markets, which are the preferred approach of many economists, climate and consumer advocates, and many electric utility companies that own and operate power plants?

It all comes down to politics. Before the last recession, political support was building for a carbon market, with various Republicans, including Senator John McCain, his party’s 2008 presidential nominee, supporting a market-based approach. After House Democrats approved a cap-and-trade bill in 2009 that put a price on fossil-fuel emissions, the issue became a target of the Tea Party. In the midst of the worst economy in 75 years, the Senate declined to take up the measure, and cap and trade became a dirty term on Capitol Hill.

Even so, several states already have turned to this approach. California’s effort began in January. Nine mid-Atlantic and Northeast states use it under the Regional Greenhouse Gas Initiative.

In Washington, faint whispers of a carbon tax are still occasionally heard as a solution for budget and environmental problems in a single policy. But even if that were to happen, the tax would probably be small and would not guarantee the reduction in emissions needed. Like a tax, carbon markets can also generate revenue that can be rebated to consumers or used to lower other taxes.

The United States can still move back into a leadership position in the effort to reduce carbon dioxide in the atmosphere. Learning from the experiences of the European Union and other programs, America can avoid the hiccups that hampered early efforts.

As the effects of a warming climate become increasingly apparent and the costs of adaptation rise, inaction will become an untenable political position. Markets play to America’s strengths. As the first President Bush said about his policy of emissions markets for controlling acid rain, markets “harness the creativity and ingenuity of the private sector.” What could be more American than that? Just ask the Chinese.

Dirk Forrister is president and chief executive officer of the International Emissions Trading Association. Paul Bledsoe is a senior fellow in the energy and climate program at the German Marshall Fund of the United States.

http://www.nytimes.com/2013/08/10/opinion/pollution-economics.html?nl=todaysheadlines&emc=edit_th_20130810&_r=0

A misleading ‘Obamacare’ poll, courtesy of the Chamber of Commerce and Harris Interactive

U.S. Chamber and Harris Interactive teamed up to lie to public about Obamacare in a recent survey.  Read the story from The Washington Post below that exposes the fraud.

Here are the important points.

--The survey was not a traditional random survey of businesses.  Instead it was an opt in of 499 U.S. Chamber members (think big businesses that hate Obamacare) and 805 non-U.S. Chamber members considered to be small businesses by Harris Interactive.  But since this group was not random and we don’t know what list they were drawn from, they could have all been from the National Federation of Independent Business (the NFIB is another Obamacare-hater group).

--The U.S. Chamber released the results of this poll like this:  “Despite the Administration’s delay of the employer mandate by a year, small businesses expect the requirement to negatively impact their employees. 27% say they will cut hours to reduce full time employees, 24% will reduce hiring, and 23% plan to replace full time employees (30 hours per week or more) with part-time workers to avoid triggering the mandate.”

--The U.S. Chamber wanted the public to believe that 74% of small business owners will be cutting employee hours or not hiring because of Obamacare.  Here is a tweet from Speaker of the House John Boehner, “Study: ‘74% of small businesses will fire workers, cut hours under #Obamacare.’”

--Close analysis of the survey and the results actually show something quite different. The actual number of  “small business” owners or executives in the survey saying that they might reduce employee hours or not hire was only 4.5 to 8.5 percent.  

The Washington Post story concludes, “the Chamber of Commerce got exactly what it paid for in this poll.”  That would be the U.S. Chamber, not those of us that actually represent small businesses.

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The Washington Post
July 31, 2013

A misleading ‘Obamacare’ poll, courtesy of the Chamber of Commerce and Harris Interactive

By Glenn Kessler

We have long warned readers about the perils of relying on data from opt-in Internet polls, especially those that make broad claims about estimating population values. We have given Pinocchios both to President Obama, for relying on an opt-in poll when he claimed that a majority of millionaires support the Buffett rule, and the National Rifle Association, for asserting that an opt-in poll reflected the views of the nation’s police.

This is a yet another case, but with a wrinkle. Here, the polling company, Harris Interactive, and the sponsor, the U.S. Chamber of Commerce, presented the data in a highly misleading way — and then made false claims about the type of poll that had been conducted.

The Chamber has been a fierce opponent of the health-care law, a.k.a. Obamacare, and we frequently warn readers they should always be skeptical of polls peddled by partisan organizations. Perhaps it should be no surprise that this poll was released just as the GOP-led House of Representatives scheduled a vote to repeal the law.

Given the way the data was presented, Republican lawmakers thought they had been handed a gift — and ended up with egg on their faces.

Read more.

Fewer Than 50 Staffers? Your Four Main Obamacare Options

Entrepreneur
August 7, 2013

BY Dinah Wisenberg Brin

Small businesses with fewer than 50 full-time employees -- or the equivalent -- as defined by the U.S. Affordable Care Act may wonder what they should do to prepare for employee open enrollment on the new healthcare exchanges this October.

If you're among those with questions, watch this recent webinar hosted by a state office of the U.S. Small Business Administration. In it, Frank Knapp Jr., president and CEO of the South Carolina Small Business Chamber of Commerce, shares the main options. We've listed the highlights below, but you can access it yourself here.

Option 1: Do nothing. Businesses with fewer than 50 "full-time-equivalent" employees aren't obligated to provide coverage under the ACA. These businesses can opt out of providing health insurance and take no action. In this scenario, employees will be responsible for obtaining their own health insurance and will be eligible for government premium subsidies if they qualify based on income and if they purchase coverage on the individual exchanges. Bear in mind that the law defines full-timers as employees who work, on average, at least 30 hours weekly, and counts the hours worked by part-timers toward an employer's number of full-time-equivalent workers.

To note: You may decide to "do nothing" as a business owner, but you're still required (as an individual) to obtain health insurance for yourself and family, either via the exchange, outside the exchange or through your spouse's employer.

Option 2: Do not offer health insurance, but offer help. These companies can find an insurance agent or broker to guide employees through the exchange, and help them choose the most appropriate coverage for themselves and their families. Qualifying employees will be eligible for subsidies under this scenario as well. Keep in mind that subsidies are not just for low-income Americans; many middle-class individuals and families will qualify as well. Brokers receive commissions from the exchanges and might negotiate fees with businesses, depending on the additional services they can offer you.

Option 3: Use the exchanges to offer one plan for all employees. Offer health insurance to employees through the small-business exchange in your state, choosing one plan for all employees. You can do this on your own or consult with an insurance broker or agent who also can handle enrollment. Employees enrolled in this plan will not be eligible for government premium subsidies. (The Obama administration expects that employers eventually will be able to offer employees a choice of plans on the small-business exchanges for coverage starting in 2015.)

Option 4: Obtain health insurance for employees outside of the exchange. Employers may do this on their own or through a broker or agent. By securing group health insurance outside the exchange, however, the employer will become ineligible for the tax credits that are available to many small businesses offering coverage through the official, state-based marketplaces. Employees won't be eligible for government premium assistance in this scenario.


Read more: http://www.entrepreneur.com/article/227674#ixzz2bOF4eRAE

NOAA: 2012 among 10 hottest years

The Hill's Energy & Environment Blog
August 6, 2013

By Zack Colman

Last year was one of the 10 hottest on record for the planet, according to a new federal report that could provide new fuel for President Obama's climate change push.

The National Oceanic and Atmospheric Administration-led study said 2012 was either the eighth or ninth hottest on record globally, depending on the data set used. Temperatures in the United States specifically were the warmest on record.

"Many of the events that made 2012 such an interesting year are part of the long-term trends we see in a changing and varying climate-carbon levels are climbing, sea levels are rising, Arctic sea ice is melting, and our planet as a whole is becoming a warmer place," acting administrator Kathryn D. Sullivan said in a statement.

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S.C. laws hinder clean energy investment

Columbia Regional Business Reports
August 6, 2013

The state has missed out on millions from the American Recovery and Reinvestment Act. Meanwhile, South Carolina’s laws also are blocking projects on Defense Department sites.

By Mike Fitts
colanews@scbiznews.com
Published Aug. 5, 2013

South Carolina’s laws are holding back growth in promising clean energy fields while other Southeast states are forging ahead, according to several experts on entrepreneurship in the field.

State rules require that solar companies be regulated like full-blown utilities if they sell energy to any third party, even a U.S. military base. This imposes a burden on startups that is blocking the state’s potential, a top expert in financing clean energy projects told attendees of the S.C. Clean Energy Summit on July 11.

“Your state policy doesn’t lend itself to renewable energy development,” said Lee Peterson of Cohn Reznick, an Atlanta-based accounting and tax advisory firm.

Federal tax laws encourage clean energy projects, and there is substantial capital out there from hedge funds and other investment groups looking to back them, Peterson said.

In other states, Peterson said, entrepreneurs can set up and operate a solar or wind farm, for instance, and capital investors will buy a majority interest in exchange for the tax breaks. South Carolina laws shut all that down, except for projects launched by the major utilities, and the capital flows to other states.

Missing out on investment

South Carolina has missed out on millions from the American Recovery and Reinvestment Act, Peterson told the conference. North Carolina has gained more than $700 million in clean energy projects from one of the act’s tax reimbursement provisions, while South Carolina has only drawn $57 million. That shortfall is directly attributable to the state’s outdated laws on clean energy investment, Peterson said.

South Carolina’s laws also are blocking projects on Defense Department sites, according to Dave McNeil, president of Hannah Solar Government Services. The Charleston-based company launches renewable energy projects on military bases, but has none in South Carolina, despite federal incentives.

A bill to change how South Carolina regulates clean energy (House bill 3425 and similar Senate bill 536) failed to advance in this year’s legislative session. The Legislature’s Public Utilities Review Committee has appointed an advisory panel to work on these issues, and South Carolina Electric & Gas is working in that process, according to utility spokesman Eric Boomhower. Boomhower points out that SCE&G has more than 200 customer-owned solar powered generators, providing or displacing nearly 1.3 megawatts of generating capacity. Owning your own solar or wind power system avoids the legal issue that has left entrepreneurs unable to resell power in the state.

The Clean Energy Summit brought renewable energy entrepreneurs and utility leaders into the same room together; SCE&G served as one of the event’s sponsors. The event saw some positive and substantial discussion among the parties, said Tom French, executive director of the event host, the S.C. Clean Energy Business Alliance.

“The issue is complicated, but both sides are trying to define win-win outcomes,” French said after the summit.

In his keynote address at the event, Sen. Vincent Sheheen, D-Camden, noted the differences of opinion in the room and urged the sides to come together so that the state can grow its economy and jobs with clean power.

Keeping dollars at home

Helping clean energy build in the state would keep billions of dollars here that now flow to other states that produce fossil fuels, he said.

“This is an industry we need to get behind,” said Sheheen, considered the likely Democratic candidate for governor next year.

State government needs to show more leadership on clean energy, including showing taxpayers how embracing solar power and energy efficiency can save them money, Sheheen said. Such projects as solar arrays on state office buildings would help with government’s huge power costs and help the industry show what it can accomplish, Sheheen said.

“Our state government certainly should be a good example,” he said. Sheheen described constituents

That shows how much room South Carolina has to improve on energy, Sheheen said. To address this, Sheheen endorsed making small loans for efficiency improvements available, to be repaid through customers’ energy bills.

Not improving energy efficiency and clean energy use would be a waste of the state’s resources, Sheheen said. So far, the state has fallen behind because of a lack of leadership on energy, he said.

“The big vision needs to come from the governor’s office,” Sheheen said.

https://www.columbiabusinessreport.com/news/48495-s-c-laws-hinder-clean-energy-investment?rss=0

SC Department of Insurance releases bogus analysis of data to scare public

The Greenville News
August 3, 2013

“I would strongly encourage the public not to get too excited about these numbers, because there’s actually good news coming in federal subsidies,” said Frank Knapp, president and CEO of the South Carolina Small Business Chamber who supports the changes to how customers buy health insurance.

Health law to hit some hard

By Eric Connor

Health insurance premiums for those in South Carolina who aren’t covered through their employers could rise dramatically next year once the federal government’s Affordable Care Act takes effect, according to a state insurance agency’s review that proponents of the new health care law insist doesn’t paint a complete picture.

The state Department of Insurance on Friday released the results of its review of health plans that insurance companies want to offer on the new federally subsidized insurance exchanges that are required under what’s commonly referred to as Obamacare.

The agency’s director, Ray Farmer, said that average rates for individuals buying insurance will likely increase between 50 to 70 percent, and in some cases could more than double depending on age, health and insurance needs.

Those who participate in small group plans will likely see average rate increases between 10 to 20 percent, Farmer said.

Premiums for people who are insured through employer-sponsored plans won’t be affected when new coverage plans go into effect on Jan. 1, he said.

“Due to a number of new federal requirements going into effect next year as part of the Affordable Care Act, consumers should plan for premiums to increase significantly,” Farmer said.

The estimates are based on comparing plans insurance companies offer now to those they have submitted for exchange enrollment on Oct. 1.

However, critics of the findings said Friday that the analysis doesn’t elaborate on other factors of the health care law, such as federal subsidies that will help most customers afford the premiums.

“I would strongly encourage the public not to get too excited about these numbers, because there’s actually good news coming in federal subsidies,” said Frank Knapp, president and CEO of the South Carolina Small Business Chamber who supports the changes to how customers buy health insurance.

The insurance plans offered today aren’t comparable and in fact many wouldn’t be allowed under provisions of the new law that ban limits on pre-existing conditions and mandate coverage for everyone, said Cheryl Fish-Parcham, deputy director of health policy for the advocacy group Families USA.

“Insurance will be covering more than it has in the past,” she said. “In the past, many people faced crazy exclusions of benefits like buying coverage but it not covering maternity care for a woman. For the first time, people are going to be getting real coverage that covers them.”

The state’s largest insurer, BlueCross BlueShield, said the rates it submitted for review were fair but that new requirements must be taken into account, such as more benefit requirements, federal taxes and fees, changes in how companies must calculate rates and guaranteed coverage.

“These additions and changes add unavoidable, additional expense for our customers,” said BlueCross spokeswoman Elizabeth Hammond.

Lawmakers in South Carolina have fought implementation of the health care law from the start, citing an overreach of government authority that requires people to buy health insurance they might not want.

The state opted not to create a state exchange, instead relying on the federal government’s system, and rejected federal money expanding Medicaid.

“Today’s news that insurance premiums in South Carolina may skyrocket as much as 70 percent for some South Carolinians is as awful as it is unsurprising,” said Doug Mayer, spokesman for Gov. Nikki Haley.

About 900,000 uninsured South Carolina residents will have to sign up for insurance or face fines under the law.

In 2014, a person who doesn’t pay for health insurance but is deemed financially able to faces a fine of $95 or 1 percent of annual income, whichever is greater. The fine is $47.50 per child but no more than $285 for a family.

In 2015, the fine increases to $325 per adult, $162.50 per child but no more than $975 for a family, or 2 percent of annual income.

The fine in 2016 and beyond will be $695 per adult, $347.50 per child but no more than $2,085 for a family, or 2.5 percent of annual income.

The fine wouldn’t provide health insurance if a person got sick.

The federal government must now approve the exchange plans insurance companies submitted to the state.

Of South Carolina’s 12 health insurers, four will be selling policies on the exchange with the remaining selling alternate policies off the exchange, Farmer said.

The policies off the exchange will be reviewed in the next 45 days, he said.

The insurance department provided wide-ranging estimates for how the new requirements could impact premiums.

For instance, a person at age 20 could see rates increase anywhere from 5 to 151 percent, Farmer said. A person age 40 could see increases between 2 to 162 percent, a person age 60 between 13 to 134 percent.

The department is “actively working with all carriers seeking approval of filings for products to be sold in the state,” Farmer said.

“It’s a new process for everyone,” he said. “I encourage our citizens to shop around.”

 

http://www.greenvilleonline.com/article/20130803/NEWS/308020062/Health-law-hit-some-hard?odyssey=tab|topnews|text|FRONTPAGE

 

 

 

 

 

 

 

Obama’s tax plan a bad bargain for small business

The Hill's Congress Blog

8/2/13

 

By Frank Knapp Jr. - 08/02/13

President Obama is right to address the urgent need to modernize our once grand infrastructure. Unfortunately, the president’s corporate tax reforms would leave us in a deeper hole down the road.

The president’s plan to cut corporate tax rates responds to the tireless mantra of U.S. multinational corporations that America’s tax rates hurt their global competitiveness. In reality, American corporations are enjoying their highest level of profits in 60 years while their federal income taxes are close to the lowest level. The Government Accountability Office recently reported that large profitable U.S. corporations paid an effective federal tax rate of just 12.6 percent in 2010, a rate lower than many small businesses and middle-class families.

Large corporations like Pfizer, Bank of America and Google have avoided paying their fair share of U.S. taxes by abusing offshore tax havens and using accounting gimmicks to disguise U.S. profits as foreign profits. U.S. corporations are holding about $2 trillion offshore to shield it from U.S. taxation. These corporations have gamed the tax system, contributing mightily to the deficit while leaving small businesses and households to pick up a greater share of the cost of public services and infrastructure – from schools and police to roads and safe drinking water.

While the details aren’t clear, the president’s plan includes a one-time fee on offshore profits – much lower than the regular corporate tax rate – that he wants to use for investing in our country’s aging infrastructure and other priorities. Small businesses applaud increased investment in bridges, ports and other needed infrastructure that will also create jobs and put money on Main Street. However, history shows that rewarding corporate tax dodgers with hundreds of billions of dollars in tax breaks – as happened with the 2004 tax holiday that promised job creation and delivered a windfall to CEOs and shareholders instead – only accelerates tax haven abuse in the future. It would incentivize the armies of corporate accountants and lobbyists to create and exploit new loopholes even as old ones may be closed.

Ending corporate tax dodging is not a Republican issue or a Democratic issue; it’s an American issue. In a nationally representative poll, in which Republicans outnumbered Democrats, more than 90 percent of small business owners said it is a problem when large corporations use accounting gimmicks to shift their U.S. profits to foreign tax havens in order to avoid taxes pay. Whether called a one-time fee or a tax holiday, a corporate tax amnesty policy is completely unacceptable to small businesses.

The president could close offshore tax loopholes without temporarily or permanently cutting corporate tax rates through a number of bills currently pending in Congress. These include bills to end deferral of taxes on corporate profits held offshore so that corporate income is taxed as it is earned and requiring offshore transactions to have an economic purpose beyond simply avoiding taxes.

Moreover, lobbyists who could not prevent the top-bracket Bush tax cuts from being reversed are saying that the president’s plan for reducing corporate tax rates to 28 percent, with a lower 25 percent rate for manufacturers, should be accompanied by a reduction in top tax rates for individuals in order to be fair to small business owners – most of whom report their business profits on their personal tax returns. This is another effort to use middle-class small business owners as a foil to help hedge fund managers, wealthy lawyers and big businesses like Bechtel, the nation’s largest engineering firm, that are formed as pass-through income organizations. These are the two to three percent of high-income “small business” owners who would reap a big windfall if income tax rates for those at the top were reduced; the rest of the real small business owners would not be affected.

The reality is that what small businesses really need is dependable modern infrastructure and more demand for their goods and services, not tax breaks for big corporations and wealthy individuals. We can strengthen this demand by making big corporations pay their fair share of taxes and investing the new revenue in economic development.

Tax reform should be about building a vibrant 21st century economy for all businesses, not rewarding big corporations for free loading on the rest of us.

Knapp is the president and CEO of the South Carolina Small Business Chamber of Commerce and co-chair of the American Sustainable Business Council Action Fund.

Read more: http://thehill.com/blogs/congress-blog/economy-a-budget/315087-obamas-tax-plan-a-bad-bargain-for-small-business#ixzz2aq1cxhqx