Small-Business Owners Criticize Health Proposal [View All]

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July 28, 2009 – 9:28 p.m.
Small-Business Owners Criticize Health Proposal
By Jane Norman, CQ Staff


Owners of small businesses including a Maryland pizza franchise and a family-owned Virginia construction company gathered with House Republicans to blast away at the Democratic health overhaul plan, saying it would force them to cut back on employees and purchases from their suppliers.

“We’d like to see an atmosphere out of Washington that says let’s help the small businessman, not an atmosphere that says we have to pay for something ... let’s hit small business,” said Steve Rosenfield of Westminster, Colo., who owns 50 Carl’s Jr. chain restaurants with one partner and 21 more with a second partner. Westminster lies in the 2nd Congressional District represented by Rep. Jared Polis , who’s been a leader among Democratic freshmen in raising concerns about a proposed surtax that would help fund the overhaul with $544 billion in revenue.

Tuesday’s roundtable event came as Republicans pushed back aggressively at Democrats who are struggling to amass enough support in the House Energy and Commerce Committee to report out the health bill. Republicans for days have been attacking the proposed surtax for its impact on small businesses because many business owners report their profits on their individual income tax forms. However, business income represents less than a third of the money affected by the surtax.

Under the version approved by the House Ways and Means Committee, the extra tax on adjusted gross income would kick in for individuals making more than $280,000 and married couples making more than $350,000, rising to a top rate of 5.4 percent for individuals making more than $800,000 and married couples making more than $1 million. There’s been discussion of moderating that provision so that there’s a trigger for the surtax.

Business owners are also unhappy about a provision in the bill that most larger employers provide insurance to their workers or pay a penalty. Beverly McCauley of Fairfax, Va., who works for a family-owned construction company, said the firm now pays about $300,000 for employee health care and about 40 percent of workers participate. Those who don’t choose to enroll are often sending money overseas, she said. “If we fail to exist, we not only fail to exist, we take a tremendous amount of our suppliers with us,” said McCauley.

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