Service Members Home Ownership Tax Act Of 2009

Floor Speech

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Ms. STABENOW. Mr. President, first, I wish to thank my friend from New Hampshire for her advocacy on health care reform in general, but specifically working together on the areas that affect small business, I very much appreciate, and we are so pleased to have her in the Senate.

I come to the floor to join my colleagues. I know the chair of the Small Business Committee, Senator Landrieu, has been here and others will be here--Senator Lincoln, who has played such a critical role in putting together the small business provisions in the bill.

I am very pleased to have authored one of the provisions in the managers' amendment that will guarantee that small businesses get immediate help starting next year--tax cuts to help them pay for the cost of health insurance. Michigan has close to 200,000 small employers that represent about 96 percent of the employers in our State.

Most folks who think of Michigan think of large employers, large manufacturers. But, in fact, the majority of our employers, as in the majority of each of our States, are small businesses. That is where the majority of the new jobs are being created. We have just 41 percent of our firms that have fewer than 50 employees who actually are able to offer health insurance. So less than half our small businesses are able to offer health insurance, which is why we are focused on small businesses in this reform bill.

The majority of people in this country who don't have insurance are actually working. The majority of us--about 60 percent--have insurance through our employers. We have about another 20 percent or so who receive their insurance through Medicare or Medicaid or the Veterans' Administration or some other public entity and then 15 to 20 percent of the people overall in America who don't have insurance are predominantly small businesses--people working for small businesses or they are self-employed or they are working one, two, or three part-time jobs just to try to hold things together. So that is a major focus of the health care reforms that are in the legislation that is before us.

I am very pleased we have been able to put together a package that has $40 billion in direct tax cuts--$40 billion in direct tax cuts--for small businesses across America to help them afford health insurance going forward, rather than waiting for the new insurance pooling--the exchange--which will provide additional help for small businesses. This help, this tax cut, starts right away. We will see 3.6 million small businesses that could qualify for the tax cuts in this bill that will begin next year.

In my State, that means over 109,000 small businesses that could be helped by the small business tax cuts that will make premiums more affordable. So I am very pleased to be part of a group of Members who came together and worked very hard to focus on the fastest growing part of the economy, which are our small businesses.

I will just share one story, and this was from Crain's Detroit, a highly respected business publication in Michigan. Mark Hodesh, who is the owner of an Ann Arbor home and garden store, said he has seen his health insurance premiums go up more than 300 percent since 1997. In 1996, he paid $132 in health care premiums a month per employee; and this year, regular premium increases have led him to pay upward of $375 per month for each employee. So that is a 300-percent increase. He says:

I have been in small business for 40 years, and my conclusion is that without health care reform, these increasing costs will put me out of business.

That is the reality for businesses across this country. I do believe health care reform is directly tied to jobs, whether it is large businesses competing internationally that make a determination to move their facility because of health care costs, whether it is small businesses going out of business or having to decide if they keep people working or pay for health insurance or whether it is the self-employed person out on their own, in their own enterprise--maybe it is local realtor. We know realtors have struggled for years because they haven't been able to buy through a large insurance pool.

That is what this reform is all about. That is what this legislation is all about, to help small businesses, people who are working out of their homes, who are self-employed, as well as people who have lost their job and then lost their insurance. That is what this is all about.

When we look at this legislation, according to the Small Business Majority, without health insurance reform that is in this legislation the annual costs of health benefits will more than double in less than a decade. They will more than double. We know, because we have seen the statistics, that when we talk about doubling health care costs for businesses in the next 10 years, it is estimated to equal another 3.5 million jobs.

We cannot afford to lose another 3.5 million jobs because of the doubling of health care costs in America. We are focused on creating more jobs. We need to be laser focused--certainly, I am, coming from Michigan--on creating jobs not losing jobs. According to the economic analysis of the Small Business Majority, health insurance reform could save up to 72 percent of small business jobs otherwise lost to a continuing rise in health care costs. We need those jobs.

Again, health insurance reform is all about saving lives, saving money, saving Medicare, and it is certainly about saving jobs. That is why I am so pleased we have made small businesses a major priority in this legislation--both through $40 billion in tax cuts for small businesses, creating the new insurance pool through which small businesses can get the same kind of deal, have the same kind of clout as a large business today in being able to negotiate with private companies, and other provisions that are in the bill as well.

There are many reasons to support health insurance reform. Standing up for small businesses is certainly at the top of the list.

I yield the floor.

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Ms. STABENOW. Madam President, as we work toward economic recovery, it is imperative that we act quickly to extend critical tax provisions scheduled to expire this year that promote research and development, spur community development, support the deployment of alternative vehicles and fuels, and provide certainty for businesses and families.

Knowing these tax provisions are in place allows Americans to plan for the upcoming year. The longer we wait to pass this legislation, the more uncertainty we place on businesses during a time when they are starting to recover. Many of these tax provisions encourage investment, the development of new technologies, and business growth, which allow our companies to be competitive in a global marketplace.

Delaying the extension of the research credit could put more than 100,000 jobs and billions of dollars in economic activity and Treasury revenue expected in 2010 in jeopardy, according to estimates from TechAmerica. If the credit is renewed, the association estimates that 120,000 jobs would be generated and/or sustained, there would be an additional $16 billion in additional research and development and other economic activity and $13 billion in Federal tax revenue over the course of 2010. However, for every day that the credit is left expired, there is the potential to lose 331 jobs, $45 million in economic activity, and $37 million in tax revenue.

Another important tax provision set to expire this year allows businesses to write off the expenses of cleaning up brownfields, industrial land that would otherwise continue to be a blight on our communities and harm our environment. In my home State of Michigan, these credits will be needed more than ever to address the brownfields that have been left behind as a result of the restructuring of the automotive industry. Revitalization of these brownfields will be critically important to communities throughout the State and the Midwest.

It is also imperative that we restore the estate tax retroactively to January 1, 2010. I am extremely disappointed that an extension was blocked and that the estate tax will be allowed to expire in 2010. Contrary to Republicans' claims, more heirs of farm and business estates will be hit with a tax increase than if we extended the estate tax at current levels. If the 2009 rules are retroactively applied, then only approximately 6,000 estates would pay the estate tax each year; however, if the estate tax expires, then it is estimated that 61,000 estates could be hit with the capital gains tax. It is critical that we extend the estate tax under the 2009 parameters to protect small businesses and family-owned farms, continue the incentive that the estate tax provides for charitable giving, and provide certainty for the heirs of farm and business estates.

During one of the most challenging economic times our country has faced, dragging our feet on these tax extensions could have a substantial impact on our Nation's businesses and families at a time when we should be doing all we can to help them succeed. I look forward to working with Chairman BAUCUS and Ranking Member GRASSLEY to retroactively extend expiring tax credits expeditiously when we return next year.

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