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Home   Membership   Expos   Publications   Knowledge Center   Education   Coffee Service   Gov. Affairs   Career Center Dec. 17, 2010
 


Federal Issues



High Priority: Congress Voting on Tax Packages
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The U.S. Congress is working this week and next to pass legislation providing extensions of the current tax rates, and providing economic incentives. The Senate has passed the legislation, and as we go to press the House is poised to also pass the bill. The vending industry should applaud the U.S. Senate for voting for tax relief and stopping tax rate increases. All Americans will see relief. But in particular the vending industry will specifically benefit from the 100 percent expensing provision. This will help the industry keep and grow jobs. The $858 billion package, which was negotiated between the White House and Congressional leaders, proposes in-part to:
• Temporarily extend the 25 percent, 28 percent, 33 percent, and 35 percent personal income tax brackets through 2012.
• Temporary extend bonus depreciation. For investments placed in service after Sept. 8, 2010, and through Dec. 31, 2011, the bill provides for 100 percent bonus depreciation. For investments placed in service after Dec. 31, 2011, and through Dec. 31, 2012, the bill provides for 50 percent bonus depreciation. During 2011, vending operators will be able to depreciate 100 percent of equipment purchased in 2011.
• Temporarily extend increases in the maximum amount and phase-out threshold under section 179. Under current law, a taxpayer with a sufficiently small amount of annual investment may elect to deduct the cost of certain property placed in service for the year rather than depreciate those costs over time.
• Temporarily approve a Payroll Tax Holiday. Under current law employees pay a 6.2 percent Social Security tax on all wages earned up to $106,800 (in 2011) and self-employed individuals pay a 12.4 percent Social Security self-employment tax on all their self-employment income up to the same threshold. The bill provides a payroll/self-employment tax holiday during 2011 of two percentage points. This means employees will pay only 4.2 percent on wages and self-employed individuals will pay only 10.4 percent on self-employment income up to the threshold.
• Reinstate the Business Research and Development tax credit. The bill reinstates for two years (through 2011) the research credit.
• Extends enhanced charitable deduction for contributions of food inventory.
The bill extends for two years (through 2011) the provision allowing businesses to claim an enhanced deduction for the contribution of food inventory.
• Extend Work Opportunity Tax Credit (WOTC). Under current law, businesses are allowed to claim a work opportunity tax credit equal to 40 percent of the first $6,000 of wages paid to new hires of one of nine targeted groups. These groups include members of families receiving benefits under the Temporary Assistance to Needy Families (TANF) program, qualified veterans, designated community residents, and others. The WOTC program is currently set to expire Aug. 31, 2011. The bill extends this provision through Dec. 31, 2011, and would be effective for employees hired after date of enactment.
• Excludes small business capital gains. Generally, non-corporate taxpayers may exclude 50 percent of the gain from the sale of certain small business stock acquired at original issue and held for more than five years. For stock acquired after Feb. 17, 2009, and on or before Sept. 27, 2010, the exclusion is increased to 75 percent. For stock acquired after Sept. 27, 2010, and before Jan. 1, 2011, the exclusion is 100 percent and the AMT preference item attributable for the sale is eliminated.



Estate Tax Changes Coming
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As part of the above legislative package on taxes, Congress is considering changes to the federal estate tax rate. The Obama Administration supports the tax rate most likely to pass; a 35 percent tax on the value of an estate above $5 million. However, Democrats in the U. S. House of Representative lean toward a tax rate of 45 percent on estates worth at least $3.5 million. An estate tax has not been in effect during 2010 and unless Congress acts it will be increased to a 55 percent tax rate on estates worth more than $1 million. For additional information contact Ned Monroe at nmonroe@vending.org.


President Obama Signs Child Nutrition Legislation
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On Monday, Dec. 13, President Obama signed into law the Healthy, Hunger-Free Kids Act 2010. The bill, which was backed by First Lady Michelle Obama in her campaign to end childhood obesity, will expand the school lunch program, attempt to provide better access to more fruits and vegetables and will establish new standards for foods sold in cafeterias, vending machines and other school locations during the school day. The U.S. Department of Agriculture will now develop nutritional standards. This will include one standard for food sold in vending, a la carte, cafeteria and other school locations. This may help vending operators and product manufacturers since there will soon be one national standard rather than a patchwork of state and local nutritional guidelines. In addition, it does not ban vending machines from school grounds, as some activists occasionally recommend. For additional information contact Ned Monroe at nmonroe@vending.org.


Agriculture Secretary Provides Insight on School Nutrition
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Tom Vilsack, Secretary of the U.S. Department of Agriculture recently sent a letter to U.S. Representative George Miller (D-CA) discussing potential implementation of the above school nutrition legislation. In the letter, Secretary Vilsack wrote that "The language of Section 208 [of S. 3307, The Healthy, Hungry-Free Kids Act] is primarily aimed at vending machines, snack bars, and other similar venues. In addition, Section 208 only applies to foods sold outside of the school meal programs on campus during the school day and specifically directs the USDA to consider special exemptions for occasional school-sponsored fund raisers such as bake sales." The letter can be viewed here: ________. For additional information contact Ned Monroe at nmonroe@vending.org.


Debit Card Fee Rules May Be Released this Week
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According to the National Association of Convenience Stores, the Federal Reserve may announce rules this week to limit debit card transaction fees. The Fed is allowed, under the Wall Street Reform and Consumer Financial Protection Act, to study debit card fees and propose rules to ensure the costs are "reasonable and proportional" to the actual cost to process a transaction. After the proposal is made, the public will have an opportunity to study and comment prior to a final rule and implementation. For additional information contact Ned Monroe at nmonroe@vending.org.


New Calorie Disclosure Regulations Will Require 14 Million Hours per Year in Vending
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The Food and Drug Administration recently estimated that the vending industry will need more than 14 million staff hours each year to label snacks and comply with their new federal regulation. Calorie disclosure, which passed Congress in the federal health care reform legislation, requires that anyone who owns or operates 20 or more vending machines disclose the calories of all snacks and drinks prior to the point of purchase. NAMA is working with Congress and the administration to reduce this harmful economic burden. For additional information contact Ned Monroe at nmonroe@vending.org.


TAKE ACTION
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Now is your chance to let the Food and Drug Administration know of your concerns with this estimate that it will take 14 million hours to comply with calorie disclosure in vending machines. Please use this link to send a comment to the FDA on this issue. To read the FDA request for information about the vending industry, you can use this link. NAMA is sending comments to the FDA arguing that with great flexibility, we could provide calorie information to customers much more efficiently and with much less expense.


Vending Victory — President Signs Coin Legislation Protecting Vending
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On Wednesday, December 14, President Barak Obama signed into law H.R. 6162. The legislation allows the Secretary of the Treasury to research and develop alternative coinage material and alloys. However, the Secretary must consult vending machine and coin acceptor manufacturers, and “may not include any recommendation for new specifications for producing a circulating coin that would require any significant change to coin-accepting and coin-handling equipment to accommodate changes to all circulating coins simultaneously.” NAMA supported this legislation, helped provide language for the bill, and NAMA Chairman Craig Hesch testified before Congress in July regarding potential alloy change in coins. In a recent meeting between the U.S. Mint and NAMA, it is clear that the U.S. Treasury does not currently have a coinage change study in process. Since no plan currently exists to change the coin alloys, any study could take two years to conclude. For additional information contact Ned Monroe at nmonroe@vending.org.
 
 

Other Federal Issues



IRS Announces 2011 Standard Mileage Rates
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The IRS on Friday, Dec. 3 issued the 2011 optional standard mileage rates used to calculate the deductible costs of operating a vehicle for business, charitable, medical or moving purposes. Beginning Jan. 1, 2011 the standard mileage rates for the use of a car will be: 51 cents per mile for business miles driven; 19 cents per mile for medical or moving purposes; and 14 cents per mile in service of charitable organizations. As always, taxpayers also have the option of calculating the actual costs of using their vehicle rather than using the standard mileage rates. Read the IRS release here http://www.irs.gov/newsroom/article/0,,id=232017,00.html. For additional information contact Ned Monroe at nmonroe@vending.org.


Feds to Release Dietary Guidelines
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Later this month, the U.S. Department of Agriculture and the U.S. Department of Health and Human Services will formally release the 2010 Dietary Guidelines. The Guidelines are updated and released every five years, and will impact meals which are subsidized by federal programs. The food pyramid, called MyPyramid in recent years, is also being revised and should be released at the same time. Dietary Guidelines 2010 will impact school nutrition programs and foods sold in school through vending machines. For additional information contact Ned Monroe at nmonroe@vending.org.


OSHA Proposing Workplace Noise Limits
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The Occupational Safety and Health Administration (OSHA) has proposed a new regulatory action that could add millions of dollars in new compliance costs for manufacturers. It recently announced plans to change its official interpretation of workplace noise exposure requirements and enforcement. Under OSHA's proposal, employers would be required to use extensive "engineering and administrative controls" to protect employees from loud workplace noises instead of primarily using effective personal protective equipment like earplugs. The Agency has proposed redefining the existing standards to require employers to perform any changes that are "capable of being done" regardless of the effectiveness of current procedures. For additional information contact Ned Monroe at nmonroe@vending.org.


NAMA Membership Quick Poll: Legislative Priority of Congress
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What should be the Number One Priority of the new members of Congress? Should they change health care legislation, extend tax cuts, or cut spending? Vote today on NAMA government affairs webpage: www.NAMAVoice.org.


State Issues



Arizona: State Revenues Show Signs of Rebounding
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The state of Arizona is beginning to see an increase in sales tax revenue from merchants throughout the state. The figures show that sales tax revenue is up nearly $4.3 billion from last year. This figure does not include proceeds from the 1-cent-per-dollar increase in the tax rate, which voters approved last May. The Department of Commerce also reported that that the number of people working in retail trade in October was up by 7,000 from a year ago and employment in the leisure and hospitality industry, including bars, restaurants and hotels, is up by 3,300. This does not mean that the state is out of the financial woods yet. While tax receipts are up from last year, they still are lagging behind the projections used when lawmakers put the budget together. For more information contact Sandy Larson at slarson@vending.org.


Arkansas: AVC 2011 Legislative Day February 1, 2011. Save the Date!
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The Arkansas Vending Council will be building relationships with and distributing 'goody bags' to the elected representatives of Arkansas. Join the AVC in putting a face on the vending industry in Arkansas. Please contact Mary Lou Monaghan at mmonaghan@vending.org for further details.


California: Bill Introduced to Expand Family Rights Act
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A bill has been introduced in the California State Assembly to expand family and medical leave. The bill would increase the circumstances in which the employee is entitled to protected leave by expanding the definition of child by eliminating the age and dependency elements. In addition the bill would allow for protective leave to treat other family members not currently included and domestic partners. For more information contact Sandy Larson at slarson@vending.org.


Florida: Budget Shortfall Estimate
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State economists in FL are forecasting a $3 billion budget shortfall for next year, due to slumping sales tax collections and a spike in Medicaid costs. Please contact Mary Lou Monaghan at mmonaghan@vending.org for further details.


Florida: First Networking Event in 2011— January 18, 2011
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The first Automatic Merchandising Association of Florida networking event of 2011 will be between Ft. Lauderdale and Miami. Come meet fellow vendors and suppliers in your area. This is your chance to make connections to increase your bottom line in 2011. Please contact Mary Lou Monaghan at mmonaghan@vending.org for further details.


Kansas: Medicaid Recovery Contract Awarded
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The Kansas Health Policy Authority recently awarded a three-year contract to HealthDataInsights of Las Vegas. The purpose of the contract is to search Medicaid and the state employee health insurance program for overpayments and errors and to recover the money. The contract was required under last session's Omnibus appropriations bill and it is expected that the minimum recovery will be $16 million over three years, including $5.3 million to be designated for the State General fund. For additional information contact Kim Radulski at kradulski@vending.org.


Michigan: Highest Turnover in Legislative Chamber in 50 Years
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Next year, 60 of the 110 members of Michigan's House of Representatives will be newcomers, with no state legislative experience at all, and over 90 percent of the members will have only two years' experience or less. Twenty-nine of the state Senate's 38 members will also be new (although the majority have served in the lower chamber), the highest turnover in a single legislative chamber in 50 years, according to the National Conference of State Legislatures. For more information contact Pam Gilbert at pgilbert@vending.org.


Minnesota: Dayton Elected New Governor After Emmer Concedes
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Amidst a recount to determine the winner of the Minnesota governor's race, Republican Tom Emmer conceded to Democrat Mark Dayton when it became clear that Dayton would ultimately be named the governor-elect. He also decided not to file a lawsuit to challenge the findings of the recount, which gave Dayton a lead of just over 8,700 votes. Emmer's concession made Dayton the first Democrat to serve as governor since 1991. For additional information contact Kim Radulski at kradulski@vending.org.


New Jersey: Employers Would Be Prohibited from Discouraging Unemployed Job Applicants
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The NJ Senate approved AB 3359, which would prohibit employers from barring or discouraging unemployed applicants from applying for advertised job openings. The state is still facing the prospect of an $8 billion shortfall in its next two-year budget, due by June 30. For more information contact Pam Gilbert at pgilbert@vending.org.


New York: Bill Would Forbid Anyone 19 or Younger from Buying Energy Drinks
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Suffolk County Legislator Lynne Nowick has introduced a bill to forbid people 19 or younger from buying drinks with more than 80 milligrams of caffeine per serving, calling them a health risk. Manufacturers object, stating that energy drinks contain about half the caffeine of a similar size cup of coffee, and that to be consistent, coffeehouses would have to start carding customers before serving them coffee. For more information contact Pam Gilbert at pgilbert@vending.org.


Ohio: Rep. Kucinich Believes Taxpayers Are Subsidizing Childhood Obesity
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Rep. Dennis Kucinich, D-Ohio, believes that taxpayers are subsidizing the obesity epidemic by providing tax breaks to the food industry for marketing fast food and junk food to children. According to Kucinich, the federal tax code allows companies to deduct "reasonable and necessary" expenses of marketing and advertising from their income taxes, and he believes that should not be the case when the marketing targets children. Kucinich introduced HR 4310, which would prohibit any company from claiming a tax deduction for the expense of marketing fast food to children. The bill has 28 co-sponsors and has been referred to the Ways and Means Committee. For more information contact Pam Gilbert at pgilbert@vending.org.


Ohio: November Tax Receipts Surpassed Projections by 5.4%
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The Columbus Dispatch reported preliminary numbers showing November's tax receipts surpassed projections by $65.7 million, or 5.4 percent. For the fiscal year ending in June, tax revenues were running 3.3 percent above estimates. November tax collections were boosted by personal income taxes and sales taxes that came in above forecasts. Ohio tax revenues have been coming in higher than expected, positive budget news for a state that has been struggling with deficits. The state is still facing the prospect of an $8 billion shortfall in its next two-year budget, due by June 30. For more information contact Pam Gilbert at pgilbert@vending.org.


Oklahoma: Submit Comments-Attend Hearing-Be Heard!
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In response to the 300 percent increase in tax per vending machine in Oklahoma, you are being given the chance to submit written comments (by 4:30 p.m., Jan. 5, 2011, to the Oklahoma Tax Commission, Tax Policy and Research Division, 2501 North Lincoln Boulevard, Oklahoma City, Oklahoma 73194), attend a public hearing to offer suggestions on the content of the proposed rules. (Jan. 6, 2011, 10:00 a.m. in the 4th floor hearing room at the Oklahoma Tax Commission). ** There are restrictions that must be followed to facilitate entry into the building, please contact Mary Lou Monaghan at mmonaghan@vending.org for further details.


Oregon: Coalition Against Beverage Taxes Being Formed
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To plug budget shortfalls, some elected officials in the Oregon Legislature, the City of Portland and Multnomah County may propose a tax aimed at raising grocery costs on sodas, juice drinks, iced teas and other beverages. With families and businesses already struggling in the state, Oregon citizens cannot afford any new taxes. A new coalition, the Oregon Coalition Against Beverage Taxes is being formed to give Oregon’s businesses and families the ability to send a strong message to elected officials: we can’t afford new taxes on food and beverages. For more information contact Sandy Larson at slarson@vending.org.


Tennessee: TAMA 2011 Legislative Day February 22, 2011. Mark your calendars!
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The Tennessee Automatic Merchandising Association will hold their annual Legislative Day on Feb. 22, 2011. Join your fellow vendors at the Capitol to hand out ‘goody bags’ while meeting and enlightening Tennessee's elected officials on the vending industry in Tennessee. Please contact Mary Lou Monaghan at mmonaghan@vending.org for further details.


Vermont: Healthiest State in Nation
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Vermont is the healthiest state in the nation, according to the 2010 edition of America's Health Rankings, published by United Health Foundation, the American Public Health Association and Partnership for Prevention. Vermont's strengths include its high rate of high school graduation, low violent crime rate, low percentage of children in poverty and high level of public health funding. For more information contact Pam Gilbert at pgilbert@vending.org.


Washington: Legislature to Hold Special Session
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The Washington legislature is expected to go into a special session. There is not a tax package expected, it will be strictly a budget cutting exercise. For more information contact Sandy Larson at slarson@vending.org.


Wisconsin: Governor-Elect to Challenge State Employee Unions
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Wisconsin Governor-Elect Scott Walker has announced his intent to challenge state public employee unions. Walker said he is considering ways to weaken the unions, including eliminating their ability to negotiate with the state. This announcement drew a harsh response from union representatives, who believe that Walker is simply looking for someone to blame for the state's budget deficit. Governor-Elect Walker also intends to replace the Department of Commerce with a partly private agency that would be focused on economic development. He said that this public-private partnership would help him to reach his goal of creating 250,000 new jobs during his first term. For additional information contact Kim Radulski at kradulski@vending.org.


Wisconsin: Ban on Fast Food Toys Rejected
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A proposed ban on toys in fast food meals has been rejected by the Superior City Council. The ordinance was introduced by Superior City Councilor Greg Mertzig, who proposed that toys be banned in fast food meals that didn't meet certain nutritional requirements. Mertzig's motivation was to remove rewards of eating unhealthy foods. Opponents of the ban objected to government interference on an issue that should be the responsibility of the parents. This is not the first time a ban of this nature has been discussed, with San Francisco being the first city to introduce the ban in the U.S. For additional information contact Kim Radulski at kradulski@vending.org .

The next edition of the NAMA Member Legislative Alert will be circulated on Friday, Jan. 7, 2011. Have a great holiday and Happy New Year from your NAMA team!



The National Automatic Merchandising Association www.vending.org

HEADQUARTERS: 20 N. Wacker Drive, Suite 3500, Chicago, IL 60606-3102, Voice: 312/ 346-0370, Fax: 312/ 704-4140

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WESTERN OFFICE: 150 South Los Robles Avenue, Suite 830, Pasadena, CA 91101, Voice: 626/229-0900, Fax: 626/229-0777


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