ESCA and the Foundation for Private Employee Ownership had a record turnout of over 150 ESCA members and guests attending the Leadership Summit at our new location in Fort Lauderdale last week.
Attendees were privileged to hear from three Members of Congress who play pivotal roles in the tax policy process and were first-time speakers at an ESCA conference: Senators Ben Cardin (D-MD) and John Thune (R-SD) and Representative Lynn Jenkins (R-KS). Additionally, prior to the conference kickoff, Representative Richard Neal (D-MA), who has spoken at the previous three Leadership Summits, met with the Board of Directors.
For those of you who were unable to join us, here are some key takeaways from our guest speakers (in order of appearance):
Senator Cardin, the lead sponsor of S. 1512, legislation to promote S corporation ESOPs, told ESCA members, “You are the type of companies that will give us the growth we need for America’s future and keep the jobs here.” Senator Cardin is well aware of our concerns about the possible threats to S corporation ESOPs as Congress and the Administration pursue tax reform, that could potentially include the elimination or major changes to pass-through entities. He stated, “I believe in S corps and am an unabashed supporter of pass-throughs.” He concluded with a powerful statement: “I’m for tax reform, but I’m going to make sure at the end of the day that you are protected.” We are thankful for Senator Cardin’s strong support and leadership on behalf of private, employee-owned companies that go back to his days on the House Ways and Means Committee.
The ESCA political update that followed Senator Cardin’s remarks walked ESCA members through:
- the fiscal challenges continuing to confront our economy and policymakers as they search for revenue;
- the President’s budget and tax reform proposals that take from one group to give to another;
- new attacks on pass-throughs from the Administration, C corps pressing for lower rates, and even small business groups; and,
- the politics of the 2012 election where House Republicans will likely lose seats and Senate Democrats might lose their majority.
ESCA of course has a plan to continue building support for S corp ESOPs in this pivotal election year. New initiatives include drilling down in the states represented by policymakers important to our efforts, meeting with key Governors, an enhanced communications program that will include social media, cultivating influential third party allies and launching “micro” lobby days. If you would like to participate in a “micro” lobby day, please let us know.
Senator Thune, third in seniority in the Republican Leadership as Chairman of the Senate Republican Conference, was our luncheon keynote speaker on Thursday. Like Senator Cardin, he is also a new member on the Senate Finance Committee this Congress. ESCA Chairman Greg Klein knows Senator Thune personally from their days growing up together in South Dakota. Greg has played a lead role in educating the Senator and his staff on the benefits of employee-ownership. Attendees cheered when Senator Thune concluded his remarks by announcing that he is signing on to S. 1512 as a cosponsor. (Senator Thune also received another round of applause early in his remarks when he noted that, growing up in South Dakota amidst Minnesota Vikings fans, he “was a closet Green Bay Packers fan.”)
Representative Jenkins, a CPA by training, walked attendees through a power point giving an informative look at the fiscal challenges facing America. Her slides are available on the ESCA website (www.esca.us/). A newly-appointed member to the Ways and Means Committee this Congress, Rep. Jenkins quickly got to know ESCA’s Kansas companies and was an early cosponsor of H.R. 1244, the Promotion & Expansion of Private Employee-Ownership Act. Her passion for employee-ownership was evident throughout her remarks such as, “This is the best model of both a succession vehicle and a retirement savings plan that you could ask for” and “You’ve got an advocate in me.” Rep. Jenkins even volunteered to help us add cosponsors to our bill.
Our final speaker was economist Alex Brill from the American Enterprise Institute (AEI), a moderate-to-conservative leaning Washington-based think tank. Brill has served as policy director and chief economist for the House Ways and Means Committee and was tax counsel for the National Commission on Fiscal Responsibility and Reform. By way of background, the Commission, known more popularly by its co-chairs names as “the Simpson Bowles Commission,” was established by President Obama in 2010 to draft a plan with bipartisan consensus to balance the budget and achieve fiscal stability. While the Commission did not meet its goal of attaining 14 of 18 commissioner votes on the proposal to move forward to Congress, the Simpson- Bowles proposal is still looked at by many federal policymakers as the most credible model for tax, spending and entitlement reforms. In fact, Senator Cardin in his remarks called Simpson-Bowles “the best blueprint, it’s credible.” While the report does not provide specifics, it does concern ESCA as it recommends eliminating most tax expenditures in order to lower individual and corporate tax rates.
Given the importance of the proposal and its relevance to today’s tax reform discussions in Washington, we thought ESCA members would find it informative to hear from a “veteran” of the Commission and what this proposal means as Congress moves forward on tax reform. Brill also walked through his own tax reform plan which was recently published by AEI.
Newer members to ESCA should know that the unabashed support for S corp ESOPs by Members of Congress like Senator Cardin and Representative Jenkins is developed through frequent contacts from meetings on Capitol Hill, to even more importantly, visits to local, employee-owned companies. At the conference, we encouraged all of you to help us build our ranks of supporters by inviting your Members of Congress to visit.
In addition to this congressional lineup and other speakers, attendees participated in the popular peer-to-peer breakout sessions and were briefed on the elections and political giving. Attendees also enjoyed networking opportunities at the opening reception and dinner events.
If you attended or if you missed this event, we hope you are marking your calendars now for the 2012 Federal Policy Conference and Lobby Day to be held in Washington, DC July 24-26.