Friday, May 28, 2010

Promoting Sustainable Economies in South Carolina

For everybody in the Charleston area, you need to check out Lowcountry Local First . They are an alliance that educates the public on the importance of supporting the local economy, and encourages businesses and consumers to be environmentally sustainable and socially responsible. Lowcountry Local First is one of over 60 chapters of the Business Alliance for Local Living Economies (BALLE).

Last weekend BALLE held its annual conference in Charleston. I was asked to be on a panel called “Unchambering National Business Policies” with moderator David Levine (American Sustainable Business Council) and fellow panelists Holly Sklar (Business for Shared Prosperity) and Bob Keener (Wealth for the CommonGood). While I had already established a working relationship with David, Holly and Bob, this was the first time I had met them in person.

It was a great experience to talk to people from all parts of the country about what The S.C. Small Business Chamber of Commerce is doing to promote small business development and how our position on issues is often different from that of the U.S. Chamber and other large local chambers. Being unconflicted makes all the difference.

Tuesday, May 25, 2010

Raises at utilities—Who pays?

This week the S.C. Public Service Commission (PSC) is holding a hearing on SCE&G’s request for an electric rate increase. As an intervenor I have been actively involved in the negotiations with the power company in an effort to significantly cut the initially requested 9.5% hike in rates.

The S.C. Office of Regulatory Staff (ORS), which is responsible for representing all consumers and also tasked with insuring the fiscal health of our private utilities, did the heavy lifting in forging a plan that will reduce the rate hike to 4.88% over three years. All but two of the parties officially involved in this case have agreed to the compromise but the PSC still must approve the plan after the hearing is over.

As part of the compromise reached by the parties, ORS insisted that consumers would not be asked to pay for any discretionary bonuses and raises for SCE&G employees. In these hard economic times, ORS believed that these costs should be borne by the stockholders of the company not the consumer.

The consuming public can expect this kind of oversight process because the state regulates our private utilities. After participating in four previous SCE&G rate hearings that have cut proposed rate increases by
over $200 million, I am a believer in government exercising strong regulatory oversight of utility monopolies.

Unfortunately, there is one power generating monopoly in this state that we do not regulate through the PSC—Santee Cooper. Ironically, the state of South Carolina and thus the public owns Santee Cooper and by doing so it is exempt from PSC regulation. Not only does the PSC not oversee Santee Cooper’s business, our elected leaders don’t have any oversight either. It is really a kingdom unto itself with an independent Gubernatorial appointed board.

Which brings us to the announcement this week that Santee Cooper’s Board has agreed to give 3% raises to the top five executives of the power company and in addition adjusted the salary of two of these executives upward by $36,650 and $22,000 respectively.

The pay of these Santee Cooper executives now range from $416,899 for the president to a lowly $249,534 for the general council. Every penny of these salaries and raises will be paid by the consumers of Santee Cooper. No questions asked.

For some time now I have been advocating that Santee Cooper be placed under the regulatory authority of the PSC and thus also be scrutinized by ORS. It is just as much a monopoly as SCE&G, Duke and Progress Energy with the only difference being that it is publicly owned by us. But that doesn’t mean it is making the best decisions for its consumers.

Thursday, May 20, 2010

Still Fighting the War

Photo by Kim McManus

It sure is difficult to give good information about the new health care law when the critics keep fighting the war. Such was the case this morning when I appeared on a panel sponsored by the Charleston Regional Business Journal.

One of the other three panelists was the CEO of a large primary care physician group. Armed with his talking points from the now-over Congressional battle, the gentleman kept listing all the reasons to be afraid of the new law including the bogus charge that the law requires 17,000 new IRS agents to be hired to enforce the individual mandate.

His opening salvo was that the Charleston community had plenty of primary health care available through free clinics and faith based organizations to take care of the uninsured. So the new law is trying to fix something that wasn’t broken.

I’ll let Ashley Frampton’s story in today’s SCBIZNews tell you what happened next:

Knapp fired back, criticizing what he called discrimination against the working poor. He said he would encourage everyone to use free or church-based clinics for medical care if they are real alternatives to the care available to people with insurance. “Is that the real medical home you want?” Knapp said.

My primary health care friend did say that his group would be expanding into more rural areas and locate in strip shopping malls to serve the increased demand from having more people with Medicaid or private insurance. The new locations, he said, would help solve the transportation problem some people have in getting to a doctor.
After the panel ended I congratulated the gentleman for his expansion plans and told him that his idea was exactly what needs to be done. I went away wondering why he was so adamantly opposed to a new law that obviously was going to increase demand for his services and thus his bottom line.

Tuesday, May 18, 2010

Voter Unrest

Today's primary elections in several states are said to be a test of voter unrest. A large source of that unrest I discuss in my opinion editorial that ran in The Hill's on-line version today.

Contrary to what you have heard from the tea partiers this unrest has more to do with present day Main Street than what is in the future for our grandchildren. It isn't about tomorrow's federal deficits. Its about today's local deficits for small businesses trying to keep their doors open or grow to meet some increased demand.

In my op.ed I give some solutions to today's deficit in small business loans. Hopefully the message will resonate on the Hill.

The Hill is known among those who influence policy as a "must read" in print and online. It signals the important issues of the moment. In an environment filled with political agendas, The Hill stands alone in delivering solid, non-partisan and objective reporting on the business of Washington, covering the inner-workings of Congress, as well as the nexus between politics and business. The Hill serves to connect the players, define the issues and influence the way Washington's decision makers view the debate.

Friday, May 14, 2010

NFIB Fights to Protect Their Money…At Your Expense

When the media ran the story that the National Federation of Independent Business (NFIB) was joining the “frivolous” lawsuit against the U.S. government over the new healthcare law, there were a couple important pieces of information missing. The national press is not doing its job so let me help them.

As we all know, the NFIB fought against the new law so it is no surprise that they are still fighting it. However, the new law means that this year businesses with less than 25 employees are eligible for health care tax credits that will make health insurance more affordable—the number one issue for small businesses. According to Dan Danner, the NFIB president and CEO in a March 16, 2009 letter to the Obama Administration, over 90% of their members fit into this category.

So why is the NFIB committing “malpractice” by trying to stop the new law that can benefit nearly all their members? Follow the money.

Go to and see for yourself. The NFIB has an income stream from selling health insurance. Come 2014 when the new insurance exchanges kick in, this NFIB revenue bites the dust because they won’t be able to hang in there price-wise with the other insurance carriers competing for the large pools of people.

Money is far more likely to be NFIB’s motive for joining the lawsuit than some principled concern over constitutionality.

Thursday, May 13, 2010

DONE!!! Guv’s Veto Overridden

The SC Legislature gave Governor Mark Sanford a “parting” gift—a 50-cent increase in the state’s cigarette tax.Thanks for playing, Guv.

Sanford has successfully fought the tax increase for years regardless of the purpose of the tax—even when it was to help make health insurance more affordable specifically for small business. (OK, he said he would support an increase if an equal amount of tax was reduced somewhere else. A typical proposal from the Guv that doesn’t solve a problem.)

So while it’s been a long, long time coming (8 years or more), the General Assembly has taken a significant step toward addressing the problem of affordable healthcare for many of our low income citizens, reducing health insurance premiums for businesses by reducing cost-shifting and discouraging our children from taking up the habit in the first place. It was a good week.

Listen to my radio interview today with Sen. Thomas Alexander who lead the fight in the Senate to pass the cigarette tax.

Monday, May 10, 2010

Chairman Emeritus Tim Wilkes

I took a short drive up to Winnsboro this weekend to visit an old friend who I hadn’t seen in far too long. Tim Wilkes is the chairman emeritus of our Small Business Chamber. He served as our organization’s chairman until he developed some life-threatening health problems which forced him into permanent disability. Since then he has been in and out of the hospital numerous times including last month.

But as you can see from the pic below, Tim is looking pretty good. He and his beautiful wife Nancy surround themselves with plenty of cats, dogs, goldfish, and lots and lots of plants. Tim also keeps himself plenty busy with his day-trading and antiques-collecting.

When we started the Small Business Chamber, Tim was a member of the S.C. House and a very well-known politician. It is safe to say that if Tim hadn’t put his reputation and influence behind the new organization, we might not have been able to fend off all the big business detractors that tried to stop us.

A highlight of Tim's chairmanship was appearing before a Senate Finance subcommittee in 2005 with only two other invited guests: Dr. Bill Gillespie of the Board of Economic Advisors and Governor Mark Sanford. Senator Wes Hayes and his subcommittee were making a decision on whether to support the Governor's plan to reduce all personal income tax from 7% to 4.8% over 10 years, which had already passed the House. The alternative plan, originally proposed several years earlier by the Small Business Chamber, would phase in a reduction in the income tax on small businesses from 7% to 5% over a much shorter time. A bill to do this had been introduced by Senator Hugh Leatherman and co-sponsored by 36 other Senators.

At the subcommittee hearing Governor Sanford argued for his plan. Wilkes urged the subcommittee to support Leatherman's plan saying that small businesses should not have to wait on the passage of larger tax reduction programs for the tax relief they deserved now. He also pointed out that big business C-corporations already paid only 5% in income tax and that small businesses only wanted parity. Dr. Gillespie testified that the Governor's plan had a one billion dollar price tag when the tax reduction was fully implemented. Plus, Dr. Gillespie pointed out that compared to Florida that has no income tax, Floridians pay more in overall taxes than South Carolinians.

The subcommittee voted unanimously to support Leatherman's bill. The language in the House bill was replaced with Leatherman's bill, the Senate passed it and sent it back to the House. Facing a certain loss in the House if he continued to fight, Governor Sanford voiced his support for the new plan. Because of our persistant efforts, small business owners today pay only a 5% income tax on the profits from their business. Had the Governor succeeded back then, one can only imagin how much worse our state's economic situation would have been today.

Friday, May 7, 2010

The First Blog of Many

Thanks for reading my first blog. I’m new at this so I'll await comments from the more experienced to give me direction.

Last month was a real thrill for me. Being asked to be in two press conferences at the U.S. Capitol with Senators was quite an honor. Check out the pics for details. Congressman Clyburn also asked me to speak at a House Democratic Caucus on fighting critics on the new health care law. Speaker Pelosi, House Majority Leader Hoyer and other’s that you’d recognize from Keith and Rachel’s show were there. We’re trying to edit the dvd’s of the two press conferences to post on YouTube but we’re not having great success. Any suggestions would be appreciated

We started running a new TV spot on the new health care law’s benefits to small business on ABC Columbia WOLO. Watch it and see my dig at the end about “death panels”. The SC Healthare Voices (SC Appleseed Legal Justice Center, SC Fair Share, AARP-SC and The SC Small Business Chamber of Commerce) just finished our first round of public forums on implementing the new health care law. More to come on that.

And finally for this first blog attempt, start calling your SC House and Senate members and asking them to override Sanford’s veto of the cigarette tax legislation. I know he hasn’t done it yet but it’s coming probably next week.

SC Small Business Chamber TV AD

Wednesday, May 5, 2010

Frank meets with the Congressmen

In April, Frank Knapp met with Congressmen John Spratt and James Clyburn in Washington, D.C. to present them each with a plaque on behalf of The S.C. Small Business Chamber of Commerce, thanking them for their work in passing the

historic health care reform bill. 

Their work on this legislation was invaluable. Joining Frank was Terry Gardiner of the SmallBusiness Majority.