Colorado Examples of Tax Reform Good News

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Posted by John Kartch on Thursday, February 20th, 2020, 6:00 PM PERMALINK

Colorado is benefiting greatly from the Tax Cuts and Jobs Act enacted by congressional Republicans and President Trump:

393,740 Colorado households are benefiting from the TCJA’s doubling of the child tax credit.

Every income group in every Colorado congressional district received a tax cutNationwide, a typical family of four received a $2,000 annual tax cut and a single parent with one child received a $1,300 annual tax cut.

1,081,600 Colorado households are benefiting from the TCJA’s doubling of the standard deduction. Thanks to the tax cuts, nine out of ten households take the standard deduction which provides tax relief and simplifies the tax filing process.

98,160 Colorado households are benefiting from the TCJA’s elimination of the Obamacare individual mandate tax. Most households hit with this tax made less than $50,000 per year.

Lower utility bills: As a direct result of the TCJA’s corporate tax rate cut, Colorado. residents are saving money on utility bills. Lower electric, water, and gas bills help households and small businesses operating on tight margins.

Thanks to the tax cuts,  Colorado businesses of all sizes are hiring, expanding, raising pay and increasing employee benefits:

King Scoopers ( Denver, Colorado) – raised 401(k) contributions, launched new tuition program for employees:

 

This year, King Soopers made two changes dedicated to supporting workers. Reinvesting the money it gained from the GOP tax reform bill, King Soopers raised its employee 401(k) match from 4 percent to 5 percent on June 1, Williamson said. In May it also launched its “Feed Your Future” program.

Thanks to tax reform, the grocery chain raised its employee 401(k) matches and offered workers a new tuition reimbursement program.September 17, 2018 – Denver Post

 

SALUS (Manitou Springs, Colorado) - Hiring a new engineer, equipment deductions:

“For our business, pennies add up,” Jerell Klaver, co-owner of SALUS, a 14-year old business that produces health and beauty products, said in a recent article on app.com. “If I can save a penny, it gets big really fast.” Taking advantage of the future deduction on equipment purchases, Jerell and Elissa Klaver did the math and hired an engineer to help make new manufacturing equipment for their company. All told, the couple expects to save between $500,000 and $1 million annually under the new law. - April 18, 2018, Capital One blog post excerpt

Ball Corporation (Broomfield, Colorado) - Expanding operations, hiring new employees:

We have also heard from Ball Corporation Senior Vice President and CFO Scott Morrison, who told us that his company is looking to expand its presence in the United States and add 400 more workers to its payrolls. - January 9, 2018, National Association of Manufacturers Shopfloor blog excerpt

Centennial Bolt (Denver, Colorado) – Tax reform bonuses, hiring new employees, updating facilitates, increasing paychecks, increasing community giving, and business expansion:

Mark Cordova, President of Centennial Bolt and a longtime champion of American manufacturing is part of the National Association of Manufacturers’ Executive Committee, is hailing the recently signed legislation...

“I’m mapping out putting in a new plant in the Midwest,” Cordova said. The new product line he plans to launce from that facility “is something right now that’s being manufactured primarily in China. We’re actually going to be at a competitive level to build it in the United States again.”

Other advances Cordova attributed to tax reform include:

  • New hiring: To staff Centennial Bolt’s new facility, Centennial Bolt plans to increase the size of its workforce between all its partner companies by 30 percent, growing overall from 50 employees to 65 employees.
  • New upgrades: The company plans to completely overhaul production at his existing facilities in Colorado and California.
  • New investments: Over the next two years, Cordova plans to “pour all of his profits back into the business,” and setting Centennial Bolt up to be competitive as technology continues to advance. “In our industry, there are people using 1940s equipment because it still works,” Cordova said. But the big savings from tax reform will “really allow companies that weren’t willing to make those kind of capital investments to modernize their facilities.”
  • New bonuses: Last year, soon after the tax reform was signed into law, Centennial Bolt gave its hourly workers an unexpected bonus as a “Christmas gift,” totaling about 5 percent of their annual salary. Cordova stressed that the windfall for his employees was made possible solely because of the benefits of tax reform. Centennial Bolt intends to offer another similar-sized bonus sometime in mid-2018, also as a result of tax savings.
  • Increased paychecks: Because Centennial Bolt has generous profit-sharing with their employees, much of the increased profits from Centennial’s expansion and capital investments will also go directly into the paychecks of their workforce.

“Tax savings aren’t just for me,” said Cordova. “It’s so people can have a better life. It’s always been a family motto: our goal is that people will do better for themselves so they can improve their lives and take care of their own.” Centennial Bolt’s new equipment will not just allow the firm to increase production and make work easier for employees—but Cordova said it’ll give the men and women on his shop floor a new reason to be hopeful, rather than watch more and more of their manufacturing jobs go overseas.

In addition, Centennial Bolt is using some of its tax savings to give back to the community—namely, its efforts to combat homelessness in its native Denver. At the end of last year, Centennial Bolt supported the opening of a new, 150-bed women’s shelter—helping an important group of people that have long been overlooked. Centennial Bolt also plans to expand its charitable giving to California, where it also has a sister facility, Cordova Bolt, Inc. where he is also the President of the family business. – April 24, 2018 National Association of Manufacturers article excerpt

Wibby Brewing (Longmont, Colorado) – Because of the Tax Cuts and Jobs Act, the brewing company was able to expand:

“We are so thankful that Congress has extended the current federal excise tax rates for another year,” said Ryan Wibby, president and brewmaster, Wibby Brewing, Longmont, Colo. “When preparing the 2020 budget, I was struggling to find the capital needed for the expansion of our growing brewery. The extension of the FET rates will free up $20,000, which will allow us to purchase the production equipment necessary to meet our projections and achieve our goals.” – Dec. 23, 2019, Wine Industry Advisor article.

Red Leg Brewing Company (Colorado Springs, Colorado) – The local brewery was able to use money saved because of the Tax Cuts And Jobs Act and put it towards hiring more people, health insurance for employees, 401(k) contributions for employees, and for production growth:

In a matter of days, Red Leg Brewing Company will tap into its next chapter.

The company announced this week it will break ground on an $8 million expansion project Friday along Garden of the Gods Road.

Todd Baldwin, president and founder of Red Leg, told News 5 the move will enable his company to increase its beer output from 2,500 barrels to 10,000.

"Our goal was always to be the craft beer of the military, to be on every military base in the world, and this new facility's going to allow us to do that," Baldwin said.

Red Leg's growth is not only tied to the product and innovative ideals. As a whole, craft brewers have also capitalized on an excise tax break included in President Trump's 2017 tax cuts, reducing what they pay the government for every barrel produced.

That relief allowed brewers to use the money elsewhere. At Red Leg, Baldwin said it paid for production growth, improvements in quality assurance and manpower.

"The last two years, we've invested more in now only our people here, but we were able to start health insurance and a 401(k) this year for our employees, which is super cool. And we were able to bring on more employees," Baldwin said.  – Dec. 10, 2019, NBC Southern Colorado.

Xcel Energy (Denver, Colorado) – The utility will pass tax cut savings along to customers:

Xcel Energy will pass on $20 million in federal tax savings to its natural gas customers in Colorado, with more savings on the way for electric customers.

Federal tax obligations go into the calculation that Xcel Energy and other utilities use to determine their cost of service. The Tax Cut and Jobs Act, which Congress passed in December, cut the federal corporate tax rate from 35 percent to 21 percent at the start of the year. – March 1, 2018, Denver Post article excerpt

Chipotle Mexican Grill (Headquarters in Denver and many locations statewide) – Bonuses ranging from $250 to $1,000; increased employee benefits; $50 million investment in existing restaurants:

With regard to the impact of the Tax Cuts and Jobs Act, Jack Hartung, Chief Financial Officer, said, “We’re pleased that the lower income tax rate from the tax law change will result in savings of approximately $40 to $50 million in 2018. We plan to invest more than one-third of these tax savings in our people, including by making all of our restaurant managers and crew eligible for a one-time cash bonus, awarding one-time stock bonuses to a broad group of staff employees, and enhancing a number of other benefits such as parental leave and short term disability, all to help position Chipotle as the employer of choice in the restaurant industry. We’re excited to share further details about these programs in the coming days.” – Feb. 6, 2018 Chipotle Mexican Grill statement excerpt

First Southwest Bank (Alamosa, Colorado) – Base wage raised to $14 per hour which will include full benefits:

While some long-standing businesses leave our rural Colorado towns, for more urban options, First Southwest Bank stands committed to growing and investing in the people of our Western communities.

As part of this commitment, starting team members at First Southwest Bank are immediately benefitting from the recent tax law changes, as the bank raises its starting wage to $14 an hour plus full benefits.

“We’re excited to take advantage of the tax reform and give the positive impact it has on First Southwest Bank right back to our team members and the rural Colorado community,” says Kent Curtis, First Southwest Bank CEO. “By being able to provide a higher living wage to our starting employees, and invest in our team, we can be a catalyst for economic growth, and reaffirm our commitment to a better quality of life in all of the rural Colorado communities our branches serve.”

The increased starting wages are effective immediately across their six branches in rural Colorado. – Jan. 22, 2018 First Southwest Bank press release

Canary LLC (Denver, Colorado) – due to tax reform, the company will hire more employees and increase capital spending:

“There are two components. One is ordering more capital equipment, which is what the expensing provision of the new tax reform bill allows us to do. And the second leg of that is hiring more people which we are furiously working on right now.”

"So what the tax reform package is allowing us to do is really dial up our capital spending even more, so we are going to try to achieve 50 percent revenue growth next year in 2018 over 2017."

--

"We've got a lot of aging equipment that needs to be replaced—that money is going to be spent locally. And as our activity picks up, we're also going to need to hire more people." CEO Dan Eberhart

FirstBank (Longmont, Colorado) -- $1,000 bonuses for full-time employees; $500 for part-time employees; base wage raised, salary increases.

Waste Management Inc. -- multiple locations in Colorado, with a total of 1,243 employees statewide -- $2,000 bonuses:

In light of the meaningful contributions of its employees and the new U.S. corporate tax structure, the company will distribute US $2,000 in 2018 to every North American employee not on a bonus or sales incentive plan; that includes hourly and other employees.

“We are about to get a tax benefit as our U.S. corporate tax rate goes from 35 percent to 21 percent. In considering how to best spend that, we wanted to find a way to help grow our economy, which in turn, will help grow our business, and give some of the tax savings back to those hardworking employees who do not get the opportunity to participate in our salaried incentive plans,” said Jim Fish, president and chief executive officer, Waste Management.

“So, we are offering each North American hourly full-time employee and salaried employee who does not participate in any sales incentive or bonus plan during 2018, a cash bonus of US $2,000 to show our appreciation to so many of our valued employees while growing our business and returning a good portion of the tax savings directly to the overall economy,” he continued. – Jan. 10 2018, Waste Management Inc. press release excerpt

Apple (Apple stores in Boulder, Broomfield, Colorado Springs, Denver, Littleton, Lone Tree) - $2,500 employee bonuses in the form of restricted stock units; Nationwide, $30 billion in additional capital expenditures over five years; 20,000 new employees will be hired; increased support of coding education and science, technology, engineering, arts, and math; increased support for U.S. manufacturing:

Bonuses:

Apple Inc. told employees Wednesday that it’s issuing a bonus of $2,500 worth of restricted stock units, following the introduction of the new U.S. tax law, according to people familiar with the matter.

The iPhone maker will begin issuing stock grants to most employees worldwide in the coming months, said the people, who asked not to be identified because they weren’t authorized to speak publicly. The move comes on the same day Apple said it would bring back most of its cash from overseas and spend $30 billion in the U.S. over the next five years, funding an additional technical support campus, data centers and 20,000 new employees.

Apple confirmed the bonuses in response to a Bloomberg inquiry Wednesday. – Jan. 17, 2018 Bloomberg News article excerpt

     Capital expenditures, etc:

Apple expects to invest over $30 billion in capital expenditures in the US over the next five years and create over 20,000 new jobs through hiring at existing campuses and opening a new one.

Building on the initial success of the Advanced Manufacturing Fund announced last spring, Apple is increasing the size of the fund from $1 billion to $5 billion. The fund was established to support innovation among American manufacturers and help others establish a presence in the US. It is already backing projects with leading manufacturers in Kentucky and rural Texas.

Apple works with over 9,000 American suppliers — large and small businesses in all 50 states — and each of Apple’s core products relies on parts or materials made in the US or provided by US-based suppliers.

Apple, which has a 40-year history in education, also plans to accelerate its efforts across the US in support of coding education as well as programs focused on Science, Technology, Engineering, Arts and Math (STEAM). – Jan. 17, 2018 Apple press release excerpts

Bank of Colorado (Fort Collins, Colorado) -- $1,000 bonuses to all full time employees:

Bank of Colorado is paying a special bonus of $1,000 to each full-time associate to share the benefit of the tax cut passed earlier this month by Congress.

President of Bank of Colorado, Shawn Osthoff said, "We feel strongly that the message should be loud and clear that this is a tax cut that will benefit all Americans." Bank of Colorado has 641 associates in Colorado and New Mexico.

Customers will also benefit from the tax cut as Bank of Colorado has raised interest rates on its Money Market accounts. – Dec. 27, 2017 Journal Advocate article excerpt

Scheels All Sports (Colorado location in Johnstown) -- $1,000 and $500 bonuses; investment in new stores, increased charitable donations:

SCHEELS is about our PEOPLE and the communities in which we live and work. As we enter 2018, the new tax reform bill offers a huge opportunity for American business and notably our employee-owned company. This new bill allows SCHEELS to:

- Invest in new stores
- Create jobs in new and existing markets
- Increase our charitable impact in our communities
- $1,000 bonus for Scheels associates working >1000 hours
- $500 bonus for Scheels associates working 500 hours

It’s opportunities like this that give our employee-owned company the ability to create a vision for steady and healthy growth in our communities. – Dec. 28, 2017 Scheels statement

--

Right after the tax reform bill became law in December, leaders of Fargo-based Scheels All Sports decided employees would get some extra money, a company official said during Vice President Mike Pence's campaign-style rally here Tuesday, March 27.

"We knew we wanted to do something intentional right away," said Chief Financial Officer Michelle Killoran. "So we decided to give a tax-reform bonus to our associates."

After hearing from employees, it became clear many didn't know what tax reform was or that it had happened, she said. Company leadership responded by holding meetings to explain to employees the "positive impacts" of the reforms to them and their employer, she said. – March 27, 2018 Fargo Forum article excerpt

STERIS Corp. (Colorado location in Denver -- Synergy Health) -- $1,000 bonuses totaling $7 million for non-executive U.S. -based employees:

"Like many companies, the recent tax reform in the U.S. will result in significant additional earnings for STERIS to strategically grow our business and return value to Customers, employees and shareholders.  One of our first actions on that front will be a one-time special discretionary bonus of $1,000 to all U.S. employees other than senior executives." -- Feb. 7, 2018 STERIS plc press release

AT&T -- $1,000 bonuses to 2,675 Colorado employeesNationwide, $1 billion increase in capital expenditures:

Today, Congress approved legislation representing the first comprehensive tax reform in a generation. The President is expected to sign the bill in the coming days.

Once tax reform is signed into law, AT&T* plans to invest an additional $1 billion in the United States in 2018 and pay a special $1,000 bonus to more than 200,000 AT&T U.S. employees — all union-represented, non-management and front-line managers. If the President signs the bill before Christmas, employees will receive the bonus over the holidays.

“Congress, working closely with the President, took a monumental step to bring taxes paid by U.S. businesses in line with the rest of the industrialized world,” said Randall Stephenson, AT&T chairman and CEO. “This tax reform will drive economic growth and create good-paying jobs. In fact, we will increase our U.S. investment and pay a special bonus to our U.S. employees.”

Since 2012, AT&T has invested more in the United States than any other public company. Every $1 billion in capital invested in the telecom industry creates about 7,000 jobs for American workers, research shows. -- Dec. 20, 2017 AT&T Inc. press release 

FMS Bank (Fort Morgan, Colorado) – Increased 401(k) contributions.

T.J. Maxx – 17 stores in Colorado – Bonuses, increased retirement plan contributions, parental leave, enhanced vacation benefits, and charitable donations:

The 2017 Tax Act benefited the Company in the fourth quarter and full year Fiscal 2018. The Company expects to continue to benefit from the 2017 Tax Act going forward, primarily due to the lower U.S. corporate income tax rate. As a result of the estimated cash benefit related to the 2017 Tax Act, the Company is taking the following actions:

Associates

  • A one-time, discretionary bonus to eligible, non-bonus-plan Associates, globally
  • An incremental contribution to the Company’s defined contribution retirement plans for eligible Associates in the U.S. and internationally
  • Instituting paid parental leave for eligible Associates in the U.S.
  • Enhancing vacation benefits for certain U.S. Associates

Communities:

Made meaningful contributions to TJX’s charitable foundations around the world to further support TJX’s charitable giving. – Feb. 28, 2018 The TJX Companies Inc. press release excerpt

Best Buy -- 26 stores in Colorado -- $1,000 bonuses for full-time employees; $500 bonuses for part-time employees. Over 100,000 employees will receive bonuses:

Best Buy is the latest major corporation to hand out bonuses to its employees as a result of the recently passed corporate tax reform.

In a letter sent to employees Friday afternoon, CEO Hubert Joly said full-time employees will receive a one-time bonus of $1,000 and part-time employees $500.

All permanent employees who are not on an existing bonus plan will receive the additional funds. The bonuses are expected to show up in their paychecks this month.

In all, more than 100,000 of Best Buy’s 125,000 employees in the U.S., Mexico and Canada are slated to receive the extra payouts.

In addition, Best Buy is making a one-time contribution of $20 million to the Best Buy Foundation to help further expand its teen tech centers and Geek Squad Academies across the U.S.

“Our goal was simple: to say ‘thank you’ to more than 100,000 of our employees and help accelerate our work to bring much needed technology training to 1 million underserved teens a year,” said Jeff Shelman, a Best Buy spokesman. — Feb. 2 2018, Minneapolis Star Tribune

National Bank Holdings Corporation (Greenwood Village, Colorado) – $1,000 bonuses for employees making less than $50,000 (exact number receiving bonus unknown at this time):

“This move is in part a response to the recently enacted tax legislation, which is anticipated to have a positive impact on the U.S. economy.” – Dec. 27, 2017 National Bank Holdings Corporation press release

Home Depot -- 46 locations in Colorado -- Bonuses for all hourly employees, up to $1,000.

Lowe's -- 3,000+ employees at 29 stores and one distribution facility in Colorado: Employees will receive bonuses of up to $1,000 based on length of service, for 260,000 employees; expanded benefits and maternity/parental leave; $5,000 of adoption assistance.

Ryder (Eight locations in Colorado) – Tax reform bonuses:

Ryder System is the latest company to give its employees a bonus as result of the new tax law.

The Miami-based fleet management company (NYSE: R) will give a one-time cash bonus to all non-incentive bonus-eligible employees of the company employed on Dec. 31, according to a Securities and Exchange Commission filing.

The bonuses, totaling about $23 million, stem from a huge tax benefit that Ryder will receive as a result of changes in the recently passed Tax Cuts and Jobs Act, which reduces federal corporate tax rates to 21 percent from 35 percent.

Ryder said it will get a one-time tax benefit of about $586 million, or $11.04 a share, for the quarter ended Dec. 31. It said the net benefit is due to the estimated impact of reduced future tax rates on the company’s deferred tax liabilities.

The Fortune 500 company had 34,500 employees at the end of 2016, and reported $1.8 billion in revenue and $11.3 billion in assets in its most recent quarter. -- Jan. 30, 2018 South Florida Business Journal article excerpt

CarMax (Locations in Colorado Springs and Boulder) – $250-$1,500 bonuses depending on length of service:

“The nation’s largest retailer of used cars, announced plans to provide one-time bonuses to most hourly and commissioned full-time and part-time associates as a result of the recently passed Tax Cuts and Jobs Act of 2017. Bonus amounts will vary from $200 up to $1,500 based on length of service with the company.” – Feb 23. 2018, EPR Retail News article excerpt

Walmart - Colorado employees at 89 Walmart stores received tax reform bonuses, wage increases, and expanded maternity and parental leave. Walmart employees who adopt children will be given $5,000 to help cover expenses.

Cintas (Multiple locations in Colorado) --  $1,000 bonuses for employees of at least a year $500 for employees of less than a year. 

U-Haul (Multiple locations in Colorado) – $1,200 bonuses for full-time employees, $500 for part-time employees.

Taco John’s (18 Colorado locations): All full-time and part-time crew members received a $200 after-tax bonus:

Taco John’s International, Inc. announced today that in response to the 2018 Tax Cut and Jobs Act, the company gave part of its projected tax savings to its restaurant crews, general managers, corporate staff and CORE (Children of Restaurant Employees).

On Friday, Feb. 23, Taco John’s International, Inc.’s employees received a one-time bonus, as follows:

  • Every restaurant crew member - full-time and part-time - received $200 (after taxes);
  • General managers and employees at the Taco John’s Franchisee Support Center in Cheyenne received $1,000 each; and,
  • The Executive Council of Taco John’s International, Inc. (Vice Presidents and above) donated their $1,000 bonuses (a total of $10,000) to CORE, a national not-for-profit organization that grants support to children of food and beverage service employees who are navigating life-altering circumstances.
     

“At Taco John’s International, our team is our family, so sharing the financial benefits that were a result of the recent tax reform legislation only makes sense,” said Jim Creel, CEO of Taco John’s International, Inc. “We encourage other restaurant brands to follow our example and give a portion of their savings to the people that are at the heart of what we do and to great organizations like CORE that support our crew. One hundred percent of CORE’s funds directly benefit children of restaurant employees who have been afflicted with life-threating conditions.”

“We are so grateful to the Taco John’s team for their generous donation to our CORE family members,” said Lauren LaViola, executive director of CORE. “Donations like theirs help us provide for our food and beverage service families experiencing loss, illness and other life-changing circumstances, and help us get closer to our goal of helping even more families across all 50 states in 2018.”

The total amount that Taco John’s International, Inc. gave exceeded $150,000.00. – Feb. 28, 2018 Taco John’s International, Inc. press release

Starbucks Coffee Company (Multiple locations in Colorado) – $500 stock grants for all retail employees, $2,000 stock grants for store managers, and varying plan and support center employee stock grants. Nationally, 8,000 new retail jobs; an additional wage increase this year, totaling approximately $120 million in wage increases, increased sick time benefits and parental leave.

McDonald’s (230+ locations in Colorado) – Increased tuition investments which will provide educational program access for 400,000 U.S. employees. $2,500 per year (up from $700) for crew working 15 hours a week, $3,000 (up from $1,050) for managers, and more:

McDonald’s Corporation today announced it will allocate $150 million over five years to its global Archways to Opportunity education program. This investment will provide almost 400,000 U.S. restaurant employees with accessibility to the program as the company will also lower eligibility requirements from nine months to 90 days of employment and drop weekly shift minimums from 20 hours to 15 hours. Additionally, McDonald’s will also extend some education benefits to restaurant employees’ family members. These enhancements underscore McDonald’s and its independent franchisees’ commitment to providing jobs that fit around the lives of restaurant employees so they may pursue their education and career ambitions.

The Archways to Opportunity program provides eligible U.S. employees an opportunity to earn a high school diploma, receive upfront college tuition assistance, access free education advising services and learn English as a second language.  

“Our commitment to education reinforces our ongoing support of the people who play a crucial role in our journey to build a better McDonald’s,” said Steve Easterbrook, McDonald’s President and CEO. “By offering restaurant employees more opportunities to further their education and pursue their career aspirations, we are helping them find their full potential, whether that’s at McDonald’s or elsewhere.”

Accelerated by changes in the U.S. tax law, McDonald’s increased investment in the Archways to Opportunity Program includes:

  • Increased Tuition Investment:
    • Crew: Eligible crew will have access to $2,500/year, up from $700/year.
    • Managers: Eligible Managers will have access to $3,000/year, up from $1,050.
    • Participants have a choice for how they apply this funding – whether it be to a community college, four year university or trade school. There is no lifetime cap on tuition assistance – restaurant employees will be able to pursue their education and career passions at their own pace. The new tuition assistance is effective May 1, 2018 and retroactive to January 1, 2018.
  • Lowered Eligibility Requirements: Increase access to the program by lowering eligibility requirements from nine months to 90 days of employment. In addition, dropping from 20 hours minimum to 15 hours minimum (roughly two full time shifts) per week to enable restaurant employees more time to focus on studies.
  • Extended Services to Families: Extension of Career Online High School and College Advisory services to restaurant employees’ family members through existing educational partners Cengage and Council for Adult and Experiential Learning (CAEL).
  • Additional Resources: Career exploration resources for eligible restaurant employees to be available later this year.
  • Creation of an International Education Fund: Grants to provide local initiatives and incentives in global markets to further education advancement programs.
     

“Since its inception, Archways to Opportunity was meant to match the ambition and drive of restaurant crew with the means and network to help them find success on their own terms,” said David Fairhurst, McDonald’s Chief People Officer. “By tripling tuition assistance, adding education benefits for family members and lowering eligibility requirements to the equivalent of a summer job, we are sending a signal that if you come work at your local McDonald’s, we’ll invest in your future.”

After launching in the U.S. in 2015, Archways to Opportunity has increased access to education for over 24,000 people and awarded over $21 million in high school and college tuition assistance. Graduates have received college degrees in Business Administration, Human Resources, Communications, Accounting, Microbiology and more. March 29, 2018 McDonald’s Corporation press release excerpt

FedEx (Multiple locations in Colorado) – Accelerated and increased compensation; pension plan contributions:

“FedEx Corporation is announcing three major programs today following the recently enacted U.S. Tax Cuts and Jobs Act:

  • Over $200 million in increased compensation, about two-thirds of which will go to hourly team members by advancing 2018 annual pay increases by six months to April 1st from the normal October date. The remainder will fund increases in performance- based incentive plans for salaried personnel.
  • A voluntary contribution of $1.5 billion to the FedEx pension plan to ensure it remains one of the best funded retirement programs in the country.
  • Investing $1.5 billion to significantly expand the FedEx Express Indianapolis hub over the next seven years. The Memphis SuperHub will also be modernized and enlarged in a major program the details of which will be announced later this spring.

FedEx believes the Tax Cuts and Jobs Act will likely increase GDP and investment in the United States. – Jan. 26 2018, FedEx press release

Comcast (Multiple locations in Colorado) -- $1,000 bonuses; nationwide, at least $50 billion investment in infrastructure in next five years.

Wells Fargo   144 locations in Texas -- Raised base wage from $13.50 to $15.00 per hour; $400 million in charitable donations for 2018; $100 million increased capital investment over the next three years.

Note: If you know of other Colorado examples, please email John Kartch at jkartch@atr.org

The running nationwide list of companies can be found at www.atr.org/lis

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Nevada Examples of Tax Reform Good News

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Posted by John Kartch on Thursday, February 20th, 2020, 3:55 PM PERMALINK

Nevada is benefiting greatly from the Tax Cuts and Jobs Act enacted by congressional Republicans and President Trump:

228,870 Nevada households are benefiting from the TCJA’s doubling of the child tax credit.

Every income group in every Nevada congressional district received a tax cut. Nationwide, a typical family of four received a $2,000 annual tax cut and a single parent with one child received a $1,300 annual tax cut.

1,040,450 Nevada households are benefiting from the TCJA’s doubling of the standard deduction. Thanks to the tax cuts, nine out of ten households take the standard deduction which provides tax relief and simplifies the tax filing process.

52,130 Nevada households are benefiting from the TCJA’s elimination of the Obamacare individual mandate tax. Most households hit with this tax made less than $50,000 per year.

Lower utility bills: As a direct result of the TCJA’s corporate tax rate cut, Nevada residents are saving money on utility bills. Lower electric, water, and gas bills help households and small businesses operating on tight margins. Nevada utilities that have passed along tax savings include -- but are not limited to -- Southwest Gas and Nevada Energy (see below.)

Thanks to the tax cuts, Nevada businesses of all sizes are hiring, expanding, raising pay and increasing employee benefits:

Universal Plumbing & Heating Co. (Las Vegas, Nevada) – Hiring new employees, purchasing new equipment, giving employee bonuses:

President Donald Trump added some Sin City flavor to a Rose Garden event Thursday to highlight the impact of his tax cut on small businesses and working families: a pair of Las Vegas plumbers.

Kerzetski said the tax cuts paid for purchases of “much-needed trucks, tools and office equipment.” Then there were “bonuses of $500 and $1,000 to all our employees.” And his firm hired several new employees, he said. – April 13, 2018 Las Vegas Review-Journal

Junk King (Reno, Nevada) -- Purchase of additional truck; increased hiring:

These provisions allow job creators to save money on a new oven, delivery vehicles or added storefronts the moment they buy them. Perhaps more importantly, small business owners are left with more resources for new hiring, wage increases and bonuses.

For my own business, an environmentally friendly debris, clutter and junk removal franchise in Reno, tax savings will translate to hiring more workers and investing in another truck to keep up with demand.

If there’s one thing I’ve learned since opening Junk King three years ago, it’s that success in my business is also indicative of the economic health of the Greater Reno area. When homes and commercial property are sold, or families and businesses decide to upgrade their spaces, they need junk removal services. Just as the 2018 tax cuts will allow me to invest in more employees and new equipment, they also give American families the leg up to finance the projects they had once put off under harder economic times. -- Jan. 26, 2018 Nevada Independent op-ed excerpt by Brian Cassidy, owner of Junk King

Kalb Industries of Nevada, Ltd. (Las Vegas, Nevada) – Pay raises for employees who have been with the company three months or longer:

We received a tax cut from the bill that Congress passed last night and as part of our family, we would like to pass along some of that savings to you all. On your next payroll check, all employees that have been here more than three months will receive a raise on their next check. Again thank you all for all the hard work, and dedication this year. – Dec. 20, 2017 note to employees

HBM Technology Partners (Reno, Nevada) – Tax reform bonuses for employees.

Prospector Hotel & Gambling Hall (Ely, Nevada) - $500 bonuses and increase base wage to $12 per hour. 

South Point Hotel, Casino and Spa (Las Vegas, Nevada) - Doubling of bonuses for 2,300 employees.

Following the passing of the 2018 Trump Tax Reform Bill, South Point Hotel Owner Michael Gaughan will distribute more than $1 million among the property's employees. As part of the contribution, Gaughan will double all the employees' 2017 bonuses in addition to rescinding the price increase for employee health insurance. 

"Las Vegas has experience a significant amount of growth over the past two years, and this tax reform will continue to drive the economy of the city," said Gaughan. "The new bill will have a monumental effect on our economy and, in turn, our property. We want to be sure that our extended family is taken of." -- April 1, 2018 South Point Hotel, Casino and Spa press release excerpt

Fontainebleau (2755 Las Vegas Boulevard, Las Vegas, Nevada): Plans to resume the resort project which had previously committed to creating over 10,000 jobs.

Nevada Energy (Las Vegas, Nevada) – The utility is passing tax reform savings to customers:

Effective April 1, 2018, we are passing on to you a monthly savings as a result of federal tax reform – Excerpt from NVEnergy’s Energy Pricing Plans

AT&T -- $1,000 bonuses to 1,102 Nevada employees; Nationwide, $1 billion increase in capital expenditures:

Today, Congress approved legislation representing the first comprehensive tax reform in a generation. The President is expected to sign the bill in the coming days.

Once tax reform is signed into law, AT&T* plans to invest an additional $1 billion in the United States in 2018 and pay a special $1,000 bonus to more than 200,000 AT&T U.S. employees — all union-represented, non-management and front-line managers. If the President signs the bill before Christmas, employees will receive the bonus over the holidays.

“Congress, working closely with the President, took a monumental step to bring taxes paid by U.S. businesses in line with the rest of the industrialized world,” said Randall Stephenson, AT&T chairman and CEO. “This tax reform will drive economic growth and create good-paying jobs. In fact, we will increase our U.S. investment and pay a special bonus to our U.S. employees.”

Since 2012, AT&T has invested more in the United States than any other public company. Every $1 billion in capital invested in the telecom industry creates about 7,000 jobs for American workers, research shows. -- Dec. 20, 2017 AT&T Inc. press release

Taco John’s (Reno, Nevada): All full-time and part-time crew members received a $200 after-tax bonus:

Taco John’s International, Inc. announced today that in response to the 2018 Tax Cut and Jobs Act, the company gave part of its projected tax savings to its restaurant crews, general managers, corporate staff and CORE (Children of Restaurant Employees).

On Friday, Feb. 23, Taco John’s International, Inc.’s employees received a one-time bonus, as follows:

  • Every restaurant crew member - full-time and part-time - received $200 (after taxes);
  • General managers and employees at the Taco John’s Franchisee Support Center in Cheyenne received $1,000 each; and,
  • The Executive Council of Taco John’s International, Inc. (Vice Presidents and above) donated their $1,000 bonuses (a total of $10,000) to CORE, a national not-for-profit organization that grants support to children of food and beverage service employees who are navigating life-altering circumstances.
     

“At Taco John’s International, our team is our family, so sharing the financial benefits that were a result of the recent tax reform legislation only makes sense,” said Jim Creel, CEO of Taco John’s International, Inc. “We encourage other restaurant brands to follow our example and give a portion of their savings to the people that are at the heart of what we do and to great organizations like CORE that support our crew. One hundred percent of CORE’s funds directly benefit children of restaurant employees who have been afflicted with life-threating conditions.”

“We are so grateful to the Taco John’s team for their generous donation to our CORE family members,” said Lauren LaViola, executive director of CORE. “Donations like theirs help us provide for our food and beverage service families experiencing loss, illness and other life-changing circumstances, and help us get closer to our goal of helping even more families across all 50 states in 2018.”

The total amount that Taco John’s International, Inc. gave exceeded $150,000.00. – Feb. 28, 2018 Taco John’s International, Inc. press release

Southwest Gas (Las Vegas, Nevada) – The utility will pass along tax cut savings to customers:

Southwest Gas said its rate request incorporates reduced tax liability associated with the 2017 federal tax overhaul, which cut the corporate tax rate to 21%, among other changes. The tax cuts partially offset the rate increase the utility is requesting, the company said. June 1, 2018 SNL Financial article excerpt

Walmart – Nevadans employed at 42 Walmart stores received tax reform bonuses, wage increases, and expanded maternity and parental leave. Walmart employees who adopt children will be given $5,000 to help cover expenses.

Apple (Four Apple store locations in Las Vegas and one in Reno) -- $2,500 employee bonuses in the form of restricted stock units; Nationwide, $30 billion in additional capital expenditures over five years; 20,000 new employees will be hired; increased support of coding education and science, technology, engineering, arts and math; increased support for U.S. manufacturing. 

Home Depot -- 21 locations in Nevada, bonuses for all hourly employees, up to $1,000:

"This incremental investment in our associates was made possible by the new tax reform bill." -- Jan. 25, 2018 Home Depot press release

Best Buy -- Thirteen locations in Nevada; $1,000 bonuses for full-time employees; $500 bonuses for part-time employees.

CarMax (Locations in Reno and Las Vegas) – $250-$1,500 bonuses depending on length of service:

“The nation’s largest retailer of used cars, announced plans to provide one-time bonuses to most hourly and commissioned full-time and part-time associates as a result of the recently passed Tax Cuts and Jobs Act of 2017. Bonus amounts will vary from $200 up to $1,500 based on length of service with the company.” – Feb 23. 2018, EPR Retail News article excerpt

Ryder (Four locations in Nevada) -- Tax reform bonuses for employees.

Lowes -- 2,000 employees at 17 stores in Nevada; bonuses of up to $1,000 based on length of service; expanded benefits and maternity/parental leave; $5,000 of adoption assistance. 

Starbucks Coffee Company (253 locations in Nevada) – $500 stock grants for all retail employees, $2,000 stock grants for store managers, and varying plan and support center employee stock grants. Nationally, 8,000 new retail jobs; an additional wage increase this year, totaling approximately $120 million in wage increases, increased sick time benefits and parental leave. 

U-Haul (Multiple locations in Nevada) – $1,200 bonuses for full-time employees, $500 for part-time employees.

T.J. Maxx – (9 locations in Nevada) – Tax reform bonuses, retirement plan contributions, parental leave, enhanced vacation benefits, and increased charitable donations:

The 2017 Tax Act benefited the Company in the fourth quarter and full year Fiscal 2018. The Company expects to continue to benefit from the 2017 Tax Act going forward, primarily due to the lower U.S. corporate income tax rate. As a result of the estimated cash benefit related to the 2017 Tax Act, the Company is taking the following actions:

Associates

  • A one-time, discretionary bonus to eligible, non-bonus-plan Associates, globally
  • An incremental contribution to the Company’s defined contribution retirement plans for eligible Associates in the U.S. and internationally
  • Instituting paid parental leave for eligible Associates in the U.S.
  • Enhancing vacation benefits for certain U.S. Associates

Communities

Made meaningful contributions to TJX’s charitable foundations around the world to further support TJX’s charitable giving – Feb. 28, 2018 The TJX Companies Inc. press release excerpt

Cintas (Multiple locations in Nevada) -- $1,000 bonuses for employees of at least a year, $500 for employees of less than a year.

Comcast (Multiple locations in Nevada) -- $1,000 bonuses; nationally, at least $50 billion investment in infrastructure in next five years.

Chipotle Mexican Grill (Multiple locations in Nevada) – Bonuses ranging from $250 to $1,000; increased employee benefits; nationally, $50 million investment in existing restaurants.

McDonald’s (150+ locations in Nevada) – Increased tuition investments which will provide educational program access for 400,000 U.S. employees. $2,500 per year (up from $700) for crew working 15 hours a week, $3,000 (up from $1,050) for managers, and more:

McDonald’s Corporation today announced it will allocate $150 million over five years to its global Archways to Opportunity education program. This investment will provide almost 400,000 U.S. restaurant employees with accessibility to the program as the company will also lower eligibility requirements from nine months to 90 days of employment and drop weekly shift minimums from 20 hours to 15 hours. Additionally, McDonald’s will also extend some education benefits to restaurant employees’ family members. These enhancements underscore McDonald’s and its independent franchisees’ commitment to providing jobs that fit around the lives of restaurant employees so they may pursue their education and career ambitions.

The Archways to Opportunity program provides eligible U.S. employees an opportunity to earn a high school diploma, receive upfront college tuition assistance, access free education advising services and learn English as a second language.  

“Our commitment to education reinforces our ongoing support of the people who play a crucial role in our journey to build a better McDonald’s,” said Steve Easterbrook, McDonald’s President and CEO. “By offering restaurant employees more opportunities to further their education and pursue their career aspirations, we are helping them find their full potential, whether that’s at McDonald’s or elsewhere.”

Accelerated by changes in the U.S. tax law, McDonald’s increased investment in the Archways to Opportunity Program includes:

  • Increased Tuition Investment:
    • Crew: Eligible crew will have access to $2,500/year, up from $700/year.
    • Managers: Eligible Managers will have access to $3,000/year, up from $1,050.
    • Participants have a choice for how they apply this funding – whether it be to a community college, four year university or trade school. There is no lifetime cap on tuition assistance – restaurant employees will be able to pursue their education and career passions at their own pace. The new tuition assistance is effective May 1, 2018 and retroactive to January 1, 2018.
  • Lowered Eligibility Requirements: Increase access to the program by lowering eligibility requirements from nine months to 90 days of employment. In addition, dropping from 20 hours minimum to 15 hours minimum (roughly two full time shifts) per week to enable restaurant employees more time to focus on studies.
  • Extended Services to Families: Extension of Career Online High School and College Advisory services to restaurant employees’ family members through existing educational partners Cengage and Council for Adult and Experiential Learning (CAEL).
  • Additional Resources: Career exploration resources for eligible restaurant employees to be available later this year.
  • Creation of an International Education Fund: Grants to provide local initiatives and incentives in global markets to further education advancement programs.
     

“Since its inception, Archways to Opportunity was meant to match the ambition and drive of restaurant crew with the means and network to help them find success on their own terms,” said David Fairhurst, McDonald’s Chief People Officer. “By tripling tuition assistance, adding education benefits for family members and lowering eligibility requirements to the equivalent of a summer job, we are sending a signal that if you come work at your local McDonald’s, we’ll invest in your future.”

After launching in the U.S. in 2015, Archways to Opportunity has increased access to education for over 24,000 people and awarded over $21 million in high school and college tuition assistance. Graduates have received college degrees in Business Administration, Human Resources, Communications, Accounting, Microbiology and more. – March 29, 2018 McDonald’s Corporation press release excerpt

Western Alliance Bancorporation (16 branch locations in Nevada) – Base pay raise of 7.5 percent for the lowest-paid 50% of employees; increased bonuses; increased 401(k) match; etc.

Western Alliance, which has $20 billion in assets, plans to increase the base pay of the lowest-paid 50% of employees by 7.5% once the bill becomes law, the bank’s chief executive Robert Sarver said in an interview Wednesday. Bonuses will also go up, bringing the total pay increase for this group of employees to around 10%. These employees generally make $75,000 or less.

Western Alliance, which operates units including Bank of Nevada and Torrey Pines Bank, also plans to increase its 401(k) match from 50% of an employee’s contribution up to 6% of pay to 75% of an employee’s contribution up to that same level. The bank, which has about 1,700 total employees, also plans to improve maternity leave benefits, though Mr. Sarver declined to detail those changes. – Wall Street Journal article excerpt

Bank of America (66 locations in Nevada) -- $1,000 bonuses for non-executive employees.

Wynn Resorts (Las Vegas, Nevada) -- Employee bonuses.

Wells Fargo – 181 bank locations in Nevada; raised base wage from $13.50 to $15.00 per hour; nationally, $400 million in charitable donations for 2018; $100 million increased capital investment over the next three years.

Note: If you know of other Nevada examples, please email John Kartch at jkartch@atr.org

The running nationwide list of companies can be found at www.atr.org/list

More from Americans for Tax Reform


Biden Lied About His Tax Hikes on Small Business

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Posted by John Kartch on Thursday, February 20th, 2020, 1:30 PM PERMALINK

Biden will indeed raise taxes on small business

Joe Biden lied during the NBC Democratic presidential debate on Wednesday night when he said that taxes on small businesses would not go up in a Biden administration.

Here's the key exchange:

Moderator: "I want to ask you about Latinos owning one out of every four new small businesses in the United States. Many of them have benefited from President Trump's tax cuts. And they may be hesitant about new taxes or regulations. Will taxes on their small businesses go up under your administration?"

Biden: "No. Taxes on small businesses won't go up."

Biden is lying. Biden's threatened repeal of the Tax Cuts and Jobs Act would raise taxes on small businesses by raising marginal income tax rates and eliminating the 20 percent small business deduction.

Small businesses typically pay taxes through the individual tax system. If Biden repeals the TCJA as he has promised, marginal tax rates go up across the board, hitting millions of small businesses.

Biden's threatened repeal of TCJA would also eliminate the law's 20 percent deduction for small business pass-through income. There are nearly 30 million pass-through entities in the United States.

Biden's steep corporate tax increase from 21 percent to 28 percent would also hit many small businesses organized as corporations.

Biden's corporate tax hike will also directly cause utility bills to rise in all 50 states, hitting small businesses with higher electric, gas, and water bills.

Biden has been lying about taxes for a while. When he ran for Vice President in 2008 he repeatedly said he would not support any form of any tax that imposed even “one single penny” of tax increase on any American making less than $250,000. Biden shattered that promise upon taking office.

If you want to stay up-to-date on their threats to raise taxes, visit www.atr.org/HighTaxDems.


Sen. Kelly Loeffler Makes “No New Taxes” Commitment to Georgia Taxpayers

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Posted by Adam Radman on Thursday, February 20th, 2020, 9:00 AM PERMALINK

Americans for Tax Reform (ATR) commends U.S. Senator Kelly Loeffler for becoming the first candidate in Georgia's special U.S. Senate race to sign the Taxpayer Protection Pledge, a written commitment to Peach State taxpayers to oppose tax increases.

“The Taxpayer Protection Pledge stands as a barrier against tax hikes and makes continued pro-growth tax reform possible. We are ecstatic about Sen. Loeffler’s decision to sign the Taxpayer Protection Pledge to the taxpayers of Georgia,” said Grover Norquist, President of Americans for Tax Reform.

Candidates running for public office like to say they will not raise taxes, but often turn their backs on the taxpayer once elected. The idea of the Taxpayer Protection Pledge is simple enough: Make them put their no-new-taxes rhetoric in writing. It is offered to every candidate for state and federal office and all incumbents. Nearly 1,400 incumbent elected officials are signers of the Taxpayer Protection Pledge.

“The American people are tired of the tax-and-spend policies coming from Washington and they are looking for solutions that create jobs, cut government spending, and grow the economy. Signing the Taxpayer Protection Pledge and holding the line on taxes is the first step in that process,” continued Norquist.

Photo Credit: Kelly for Senate

More from Americans for Tax Reform


Michael Bloomberg is Running to Become America's Nanny

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Posted by Isabelle Morales on Tuesday, February 18th, 2020, 4:00 PM PERMALINK

Always be wary of politicians who want to control individuals’ behavior for the sake of their “well-being.” The prevalence of these paternalistic policies create what we call a “Nanny State.” Any policy created under this rationale must be based on this assumption: politicians know how to live your life better than you do. 

Ronald Reagan once said: ‘‘Government exists to protect us from each other. Where government has gone beyond its limits is in deciding to protect us from ourselves.’’

The position of humility is the non-interventionist one: people should decide how they want to live their lives and reap the benefits, or consequences, of those decisions. The idea that the government should become an intermediary between your decisions and the subsequent effects makes null our value in responsibility and accountability.

Among the 2020 Democratic candidates, former NYC mayor Mike Bloomberg stands out as one of the biggest proponents of the Nanny State.

In a 2018 interview with Christine Lagarde of the International Monetary Fund, Bloomberg contested that taxing the poor helps them live longer and "deal with themselves."

Bloomberg: "Some people say, well, taxes are regressive... That's the good thing about them because the problem is in people that don't have a lot of money. And so, higher taxes should have a bigger impact on their behavior and how they deal with themselves. So, I listen to people saying 'oh we don't want to tax the poor.’ Well, we want the poor to live longer so that they can get an education and enjoy life. And that's why you do want to do exactly what a lot of people say you don't want to do... Taxes or life? Which do you want to do? Take your poison."

Here are just a few more examples of the paternalistic policies Bloomberg championed as mayor:

1. The Infamous Soda Ban 

Michael Bloomberg proposed the sugary drinks portion cap rule, or the “soda ban,” on May 30, 2012. This proposed amendment would have barred restaurants, movie theaters, food carts, and other businesses subject to NYC Board of Health regulation from selling sodas and other sugary beverages larger than 16 ounces. The rule made its way through the courts to eventually be found unconstitutional. The New York Court of Appeals found that the New York City Board of Health exceeded “the scope of its regulatory authority,” in implementing this rule. 

The New York City Council passed the Women's Restroom Equity Bill with Mayor Bloomberg’s support. This bill establishes a 2-to-1 ratio for women's restrooms in new public venues like bars, restaurants, and concert halls.

Yvette D. Clarke, the bill's chief sponsor, explained that women are conditioned to expect restroom lines; she called this "degrading."

3. Banning Trans Fats from Restaurants

In 2006, New York City’s Board of Health, under the direction of Mayor Bloomberg, banned artificial trans fats from all of the city’s restaurants. 

At the time, “restaurant industry representatives called the ban burdensome and unnecessary.” 

The Bloomberg administration implemented a measure to force chain restaurants (with 15 or more outlets in New York City or across the country) to display calorie information on their menus or menu boards.

A study done at the NYU Langone Medical Center found that the amount of calories consumed at NYC restaurants with calorie displays was statistically the same as those without calorie displays. 

5. A War on Salt

In 2010, the Bloomberg administration unveiled a broad health initiative aimed at pressuring food manufacturers and restaurant chains to diminish the amount of salt in their products.

The administration went so far as to ban food donations to homeless shelters because they couldn't assess the sodium levels in the donated foods.

Perhaps Mayor Bloomberg’s biggest “accomplishment,” New York City banned smoking in commercial establishments like bars and restaurants in 2003, even if those establishments had allowed it themselves. In 2011, NYC banned smoking in city parks, on beaches, boardwalks, and in pedestrian plazas. Citing the danger of “second-hand smoke” as the reason for these policies, Mayor Bloomberg argued that they were necessary to improve public health. 

Ironically, in 2013, Mayor Bloomberg rushed through a law to extend the NYC Smoke-Free Air Act to include e-cigarettes. The use of e-cigs is now forbidden in indoor and outdoor locations wherever smoking is banned. E-cigarettes do not release any second-hand (or first-hand) smoke. 

Mayor Bloomberg signed a city-wide ban on flavored tobacco products into law in 2009. The legislation covers “chocolate, vanilla, honey, candy, cocoa, dessert, alcoholic beverage, herb or spice flavors,” but exempts “tobacco, menthol, mint or wintergreen flavors.”

The federal ban, at the time, was limited to cigarettes; Bloomberg extended this ban to cigars and smokeless tobacco in New York City.

In 2013, Mayor Michael Bloomberg called for legislation to make New York the first U.S. city to require stores to conceal tobacco products. This legislation would require that tobacco products be kept in cabinets, under the counter, behind a curtain, or somewhere else concealed from consumers’ eyes. 

Mayor Bloomberg facilitated a 2013 campaign to encourage teens and young adults to turn down the music on their headphones. This campaign cost the city of New York $250,000. 

The Mayor also led the effort to prohibit any commercial music sources from exceeding 45 decibels as measured in a residence.

As the New York Post explains, “The Hearing Loss Prevention Media Campaign will target teens and young adults, conducting focus-group interviews and using social-media sites like Facebook and Twitter. Bloomberg has had a bug about ear-splitting rackets since taking office at City Hall, making noise reduction one of his key quality-of-life initiatives.”

In 2006, Mayor Bloomberg implemented a city-wide ban on cellphones in New York City public schools. CBS News reported students dismantling their phones to get past metal detectors at school and hiding their phones in areas where they knew school officials would not pat them down. Overall, parents were infuriated by the ban, “insisting they need to stay in touch with their children in case of another crisis like Sept. 11.”

In the face of all of this anger, Mayor Bloomberg refused to drop the ban, claiming that cellphones are distractions used to cheat, take inappropriate photos in the bathroom, and organize gang rendezvous. 

Despite Bloomberg’s suspicions, students are probably just scrolling through their Instagram feeds. Most schools take an "out-of-sight, out-of-trouble" approach.

Our government exists to ensure each of us lives safely and freely. A small group of politicians in Washington or a city council, for that matter, has no business deciding how life should be lived by the masses. 

It is not the government’s job to dictate need, nor mandate our priorities. Bloomberg’s violations of human autonomy were objectionable when done in New York City. If done on the national level, his policies would be devastating.

 

Photo Credit: Gage Skidmore/Flickr


ATR Supports the “Education Freedom Scholarships and Opportunity Act”

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Posted by Tom Hebert on Tuesday, February 18th, 2020, 2:45 PM PERMALINK

Senator Ted Cruz (R-Texas) has introduced the “Education Freedom Scholarships and Opportunity Act, “ legislation that would help equip American workers and families with the skills they need to thrive in a 21st century economy. 

Americans for Tax Reform urges all members of Congress to support this legislation. 

President Donald Trump has made expanding access to education a priority of his administration. The Cruz bill builds on this success by providing a federal tax credit to individuals that donate to nonprofit scholarship funds, which will generate new education opportunities for students of all ages and backgrounds. These new opportunities would allow men and women to seek the technical training and apprenticeships necessary to thrive in the skilled labor force.

Similar legislation has been introduced in the House by Rep. Bradley Byrne (R-Ala.), which allows for $5 billion a year in tax credits as opposed to the $10 billion provided for in the Cruz version. The Cruz legislation is cosponsored by Sens. Tim Scott (R-S.C.), Lamar Alexander (R-Tenn.), Joni Ernst (R-Iowa), Pat Toomey (R-Penn.), Tom Cotton (R-Ark.), James Lankford (R-Okla.), Todd Young (R-Ind.), Bill Cassidy (R-La.), Jim Inhofe (R-Okla.), John Boozman (R-Ark.), Marsha Blackburn (R-Tenn.), Richard Burr (R-N.C.), Ben Sasse (R-Neb.), and Rick Scott (R-Fla.). 

18 states have already implemented similar tax credit programs to expand vocational opportunities for their residents. Cruz has worked with President Trump, Vice President Mike Pence, and Secretary of Education Betsy DeVos on how to best implement a federal version of this initiative. 

Key provisions of the Cruz bill include: 

  • States have the flexibility to create the programs that best work for them. States decide eligibility criteria for students, what constitutes education expenses, and more. 
  • Encourages workplace training education. In addition to the new federal tax credit, the Cruz bill will encourage scholarships for career and technical education, apprenticeships, certifications, and other forms of workforce training.
  • Prohibits federal control of education, and makes state participation optional. This bill completely closes the door on more federal control over state and local education priorities. 
  • Helps the most vulnerable students. The tax credit will give students in need vital scholarships and important opportunities to prepare them for gainful employment in the future. 
     

The “Education Freedom Scholarships and Opportunity Act” builds on the Trump administration’s success in expanding education opportunities for all Americans. If implemented, this bill would equip students of all backgrounds with the tools they need to succeed in a 21st century economy. 

ATR supports this legislation and urges its swift passage. 

Photo Credit: US Department of Education


Dems Want To Reimpose Obamacare Individual Mandate Tax On Millions

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Posted by Alex Hendrie, Tom Hebert on Tuesday, February 18th, 2020, 12:30 PM PERMALINK

The Democrat effort to repeal the Trump tax cuts would re-impose the Obamacare individual mandate tax penalty on millions of households, hitting thousands of families in every state and Congressional district.

Americans for Tax Reform has broken down the most recent IRS data on the individual mandate tax penalty by Congressional district, which you can view here.

The individual mandate was one of the most regressive taxes in the code before it was repealed in 2017 by the Republican passed Tax Cuts and Jobs Act. Every single Democrat in the House and Senate voted against the repeal of the Obamacare individual mandate tax. 

Prior to repeal, the mandate forced households to purchase government approved health insurance or pay a tax totaling almost $700 for an individual and $2,000 for a family.

Reinstatement of this tax will hit low and middle-income families hard.

In 2017, the tax hit 4,654,990 households according to IRS data. Nationwide, roughly 74 percent of those paying the mandate had annual income of less than $50,000 and roughly 32 percent had annual income of less than $25,000. 

Key swing states that President Trump won in 2016 would be hard-hit if the Democrats reimposed the individual mandate tax penalty. 

In Pennsylvania, the tax hit 153,140 households. 

  • 56,490 of those households, or 37 percent, had annual income of less than $25,000. 
  • 121,100 of those households, or 79 percent, had annual income of less than $50,000.


In Wisconsin, the tax hit 80,240 households. 

  • 24,550 of those households, or 31 percent, had annual income of less than $25,000. 
  • 62,440 of those households, or 78 percent, had annual income of less than $50,000. 


In Michigan, the tax hit 132,750 households. 

  • 50,920 of those households, or 38 percent, had annual income of less than $25,000. 
  • 106,910 of those households, or 81 percent, had annual income of less than $50,000. 
     

Here is the breakdown from some notable House members: 

In Ways and Means Ranking Member Rep. Kevin Brady's district (R-Texas), 13,880 households paid the Obamacare individual mandate tax penalty in 2017.

  • 3,270 of those households, or 24 percent, had annual income of less than $25,000.
  • 8,900 of those households, or 64 percent, had annual income of less than $50,000. 
     

In Ways and Means Chairman Rep. Richard Neal’s district (D-Mass.), 10,140 households paid the Obamacare individual mandate tax penalty in 2017.

  • 3,390 of those households, or 33 percent, had annual income of less than $25,000.
  • 8,060 of those households, or 79 percent, had annual income of less than $50,000. 
     

In House Speaker Rep. Nancy Pelosi’s district (D-Calif.), 9,700 households paid the Obamacare individual mandate tax penalty in 2017.

  • 2,280 of those households, or 24 percent, had annual income of less than $25,000.
  • 6,050 of those households, or 62 percent, had annual income of less than $50,000. 
     

In House Minority Leader Kevin McCarthy’s district (R-Calif.), 8,000 households paid the Obamacare individual mandate tax penalty in 2017.

  • 2,530 of those households, or 32 percent, had annual income of less than $25,000.
  • 5,870 of those households, or 73 percent, had annual income of less than $25,000. 
     

[View ATR's breakdown of the most recent IRS individual mandate tax penalty data by Congressional district

Photo Credit: Nancy Pelosi - Flickr


Rep. Harris Leads Letter Against Price Controls

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Posted by Alex Hendrie, Tom Hebert on Tuesday, February 18th, 2020, 10:15 AM PERMALINK

Congressman Andy Harris (R-Md.) recently led a letter opposed to price controls as a solution to surprise medical billing.

The letter was signed by 38 other members including House Freedom Caucus Chairman Andy Biggs (R-Ariz.), House Judiciary Committee Ranking Member Jim Jordan (R-Ohio), Republican Study Committee Chairman Mike Johnson (R-La.), and House Oversight Committee Ranking Member Mark Meadows (R-N.C.),

Rep. Harris and all signers should be commended for standing against price controls.

ATR has long opposed policies that directly or indirectly impose price controls on the US healthcare system. Price controls are bad policy because they utilize government power to forcefully lower costs in a way that distorts the economically efficient behavior and natural incentives created by the free market.

In the context of surprise billing, some lawmakers have proposed using rate-setting for any payments made to out-of-network providers. Under this system, the government would set a benchmark rate to resolve out-of-network payment disputes between insurers and providers. Benchmark rate-setting would replace private negotiations between insurers and providers with government-set prices, a blatant price control on the healthcare system. 

The signers explained the numerous problems with using rate-setting to address surprise billing, noting: 

“...we oppose price controls as a solution to the issue as a solution to the issue of surprise medical billing. By design, placing such price controls on purely private transactions, would reduce access to care, increase the power of the federal government, and result in negative unintended consequences.” 

Signers also acknowledged that while Congress should act on surprise billing, any legislation that includes price controls would be a nonstarter. As the letter states: 

“Congress should act on surprise medical billing, but it should avoid top-down price controls that would simply be trading one problem for another.” 

Conservative lawmakers have consistently expressed significant opposition to price fixing mechanisms within healthcare. For instance, 192 Republicans opposed H.R. 3, legislation that would impose price controls on pharmaceutical innovation under threat of a 95 percent excise tax.

Lawmakers need to take a serious, deliberative approach in addressing surprise billing instead of rushing to pass a flawed proposal that imposes price controls on our healthcare system. 

Thankfully, conservative lawmakers are standing firm in advocating against surprise billing proposals that rely on distortionary price fixing mechanisms. 

Photo Credit: Gage Skidmore


White House Report Highlights Foreign Freeloading of American Medical Innovation

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Posted by Alex Hendrie on Monday, February 17th, 2020, 4:32 PM PERMALINK

Foreign countries are freeloading off American medical innovation according to a recent report by the White House Council on Economic Advisers. 

Because of foreign price controls, the prices paid by other countries for pharmaceuticals is less than what is needed to incentivize the development of innovative new medicines. This harms foreign countries through lack of access to new medicines and harms the U.S. because prices are higher than they would otherwise be.

The U.S. healthcare system largely relies on free market forces that promote competition between various stakeholders. In comparison, most foreign developed countries utilize price controls to forcefully lower costs. In many cases, these countries are able to strong arm manufacturers into accepting lower prices, as the report notes: 

“In the U.S., private insurance plans compete and make decisions that reflect the value to pharmacy benefit managers or individuals selecting plans. In contrast, if a government-run monopoly plan’s employees decide not to cover a drug, there is no risk of losing a customer because the customers cannot leave. Moreover, drug companies would often rather sell drugs at prices below the value of their products than not sell at all.”

However, this does not come without costs. By relying on price controls, these developed countries have far fewer innovative cures than the U.S. In some cases, there is a wide disparity in terms of available treatments, as the report notes:

“[M]any of the 200 top-selling drugs examined here show no quantities sold in the countries of comparison, suggesting that those drugs are not available for sale in that country. For example, in Australia, only 97 of the 200 drugs show evidence of significant sales. Similarly, Canada has only 120 of the drugs, France 109, and Germany 133.”

Where prices are artificially lower in other countries, this indirectly harms American patients and taxpayers, who shoulder a greater share of the cost of innovative medicines than they are consuming. As the report notes, this problem is increasing:

“[F]or the past 15 years, stringent government underpricing in foreign countries has substantially increased foreign free-riding on the United States. Our main finding is that prices are much lower in other developed nations than would have been predicted by income differences alone and that this discrepancy is substantially widening.”

The fact is, developing new medicines is a complex, time consuming process. A manufacturer must invest a substantial amount in research and development. In addition, the clinical development and approval times average 90.3 months for a pharmaceutical drug and 97.3 months for a biologic. Given this extensive process, there is a clear linkage between the ability of manufacturers to recoup their investment and their willingness to innovate, as the report notes:

“The gains from global sales of innovative products drive incentives for research and development, which means that the challenge of financing global biopharmaceutical R&D poses a public-goods problem.”

Some proposals, like Speaker Nancy Pelosi’s plan to impose a 95 percent excise tax on manufacturers that don’t accept government price setting, or the International Pricing Index to tie U.S. prices to prices in foreign countries, would lead to the U.S. adopting the same pricing schemes that underpay for innovation.

Not only will this harm American patients in the form of fewer treatments and worse health outcomes, it will also harm the economy because of a decline in American R&D.

Manufacturers invest over $100 billion in the U.S. economy every year, directly supporting over 800,000 jobs. When indirect jobs are included, this innovation supports 4 million jobs and $1.1 trillion in total economic impact. Pharmaceutical jobs are also high paying – the average compensation is over $126,000 – more than double the $60,000 average compensation in the U.S.

If the U.S. implements the same price controls as those utilized in other countries, these jobs will be threatened. Medical innovation will be curtailed, reducing access to medicines in the U.S. and abroad. 

Rather than adopting these proposals, lawmakers should prioritize proposals that protect the free market and medical innovation and ensure that foreign countries pay their fair share.

Photo Credit: Jim Grey


RSC GEAR Report Gives 100+ Powerful Solutions For Smaller Government

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Posted by Tom Hebert on Friday, February 14th, 2020, 11:00 AM PERMALINK

The Republican Study Committee’s (RSC) Government, Efficiency, Accountability, and Reform (GEAR) Task Force recently released a report highlighting more than one hundred commonsense solutions to move the federal government in a smaller, smarter direction. 

RSC Chairman Rep. Mike Johnson (R-La.) and GEAR Task Force Chairman Rep. Greg Gianforte (R-Mont.) should be commended for their efforts in creating this extensive plan of action. 

The report identifies three central problems that plague federal bureaucracy, the first being power. Runaway federal bureaucrats have seized power from Congress, and that has opened the floodgates for abuse of power in agencies like the IRS.

The GEAR report calls for a restoration of the proper balance of power between Congress and the Executive Branch. Notably, the report recommends (among many proposals): 

  • Enacting the REINS Act, which would require Congress to pass a joint resolution for any major rule within 70 days of promulgation before the rule takes effect. This legislation would fundamentally change the rule-making process and save taxpayers money by expanding Congressional oversight on major rules. 
     
  • Expanding use of the Congressional Review Act (CRA), which allows Congress to roll back recently promulgated regulations under an expedited parliamentary process. Expanding CRA use will allow Congress to use its rightful constitutional power to prevent the implementation of harmful, costly regulations. 
     
  • Codifying that CRAs apply to “regulatory dark matter,” which would encompass so-called “guidance documents” that function as de-facto regulations. The RSC plan gives Congress an expedited avenue to strike down initiatives that do not follow the CRA process.
     
  • Enact the Article I Restoration Act, which would require federal regulations to expire every three years if not specifically authorized. 
     

Of course, restoring the proper balance of power is only the first step in constraining runaway bureaucrats. Step two is reforming government practices with a special focus on eliminating waste. The report has many suggestions large and small for eliminating waste, including: 

  • Improving metrics for regulatory decision-making. In the private sector, managers do not make strategic decisions without evidence. The RSC plan would hold bureaucracy to the same standard and encourage Congress to modernize the government’s collection of metrics to ensure policymakers are informed by the best data available. 
     
  • Utilize excess federal office space. As of 2016, federal agencies own 3,120 vacant buildings and 7,859 underutilized buildings. The GEAR Task Force recommends that agencies sell unused buildings and lease office space (when appropriate) to like-minded organizations instead of letting the buildings waste taxpayer dollars for absolutely no reason. Citizens Against Government Waste projects that these reforms would save taxpayers $15 billion over the next five years. 
     
  • Stop paying dead people. In 2016, the Social Security Administration (SSA) paid out $37.7 million in benefits to 746 dead veterans. In 2015, the SSA Inspector General identified 6.5 million individuals listed as being 112 years of age or older without any recorded death information. Embarrassingly enough, the SSA has failed to curb these improper payments to deceased individuals. GEAR Task Force Chairman Rep. Greg Gianforte (Mont. – At Large) has introduced legislation that would provide a framework for SSA to partner with state and local agencies to collect and disseminate death data. 

 

Finally, the GEAR Task Force recommends that the federal government realign its personnel policies with those of the private sector. Namely, the report proposes: 

  • Modernizing the hiring process so that hiring managers can efficiently and effectively recruit highly qualified candidates to fill jobs. On average, it takes federal agencies three times longer than the private sector to hire employees. The RSC plan recommends that Congress focus on two goals in streamlining the hiring process –– empowering hiring managers to recruit outside of OPM recommendations, and automating human resource functions to more efficiently utilize taxpayer funds. 
     
  • Enact the MERIT Act so that managers can more easily remove toxic federal employees. Currently, it takes over 300 days to remove a bad employee due to the myriad red tape associated with the process. The MERIT Act offers a framework to realign firing procedures on the federal level with the efficient practices of the private sector. Additionally, the MERIT Act also limits retirement compensation and allows managers to recoup bonuses from employees who were later found to commit workplace violations. 
     
  • Provide mandatory removal of federal employees who commit crimes. In 2016, the VA demoted (but kept on staff) an individual who was convicted of assisting an armed robbery. This plan would fully empower agencies to terminate serious criminals. 
     
  • Ban taxpayer-funded union work. Under current law, federal employees are paid for engaging in union activity while on the job. The RSC plan would eliminate this and make it a fireable offense. 
     
  • Enact merit-based pay in federal agencies, which would allow managers to reward employees based on performance. Under current law, there is barely a merit-based component to the existing compensation system, and federal workers are paid based on seniority and demonstrating an “acceptable level of competence.” The RSC plan recommends moving towards a merit-based pay system that rewards exception and highly-skilled employees with appropriate compensation. 
     

The RSC GEAR Task Force report on commonsense government reform is a powerful plan of action for when Republicans take back the House majority in November. The plan is chock-full of reforms that will rein in runaway bureaucracy and leave the American people with a smaller, better, more efficient government. 

 

Photo Credit: Joe deSousa


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