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House Small Business Committee

Graves' Statement on Tax Day and the Small Business Tax Burden

House Small Business Committee News - Mon, 09/15/2014 - 12:00am
Small Business Committee Chairman Sam Graves (R-MO) today released the following statement on Tax Day and the effects of tax policies on small businesses:

“Every year, the tax burden becomes more costly for America’s 28 million small businesses. The tax code is increasingly complicated and changes often. Most small businesses spend 40 hours or more preparing their taxes, and four out of ten businesses spend two full workweeks on compliance. That is a high cost in lost time and productivity for a small business. One in three small firms spends $10,000 on compliance. Jobs are still scarce, and the combined burdens of complex taxes and high rates are obstacles to growth. The jobs-stifling tax code is not just a Tax Day problem for small companies, but a year-round burden on their budgets that can impact their entrepreneurial decisions. Small businesses overwhelmingly support sensible reforms for lower rates, simpler preparation and clearer guidelines.”

Last week, the Small Business Committee examined these very challenges for small businesses. The growing number of tax provisions means that owners must spend significant resources on compliance that could otherwise be spent growing their companies. According to the Internal Revenue Service’s own National Taxpayer Advocate, there were over 500 changes to the tax code in 2010 alone, an average of more than one per day. And the steep tax rates mean small firms have less capital to invest back into hiring or expanding.

The National Small Business Association released a survey on April 9, 2014, in conjunction with the testimony of NSBA member Tim Reynolds, a small business executive. The growing complexity of the tax process causes 86 percent of small businesses to pay tax preparers.

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Committee Examines Onerous Licensing Barriers for Entrepreneurs

House Small Business Committee News - Wed, 07/16/2014 - 12:00am
The House Small Business Committee, under the chairmanship of Rep. Sam Graves (R-MO), today examined the barriers that certain state licensing requirements impose on entrepreneurs and individuals seeking economic opportunity, and how the Federal Trade Commission (FTC) can utilize advocacy and enforcement of federal anti-trust laws to prohibit anticompetitive regulations.

On March 26, 2014, the Subcommittee on Contracting and the Workforce held a hearing with testimony from entrepreneurs who encountered licensing obstacles to starting small businesses, even when those licenses did not directly apply to their business ideas or protect public health and safety. Today’s second hearing expanded the Committee’s examination of these challenges by looking at the FTC’s role in combating onerous licensure through the enforcement of federal anti-trust laws that promote competition. Andrew Gavil, Director of the Office of Policy Planning, Federal Trade Commission, testified.

“Sixty years ago, only 5 percent of occupations required state licenses. Since then, the number of occupations subject to these requirements has soared to nearly 30 percent, and in many cases, these rules impose a significant regulatory burden on small businesses and entrepreneurs,” said Chairman Graves. “Licensing regulations create barriers to work that disproportionately affect lower and middle-class Americans. As state licensing boards are typically comprised of people from that profession, their decisions about who can enter their profession can reduce competition. It is important that these regulations are narrowly tailored to provide a public benefit without unfairly limiting opportunities. As the Committee continues examining ways to reduce barriers to entrepreneurship, the FTC’s testimony today was insightful regarding the agency’s role in protecting a free market.”

Materials from the hearing are available on the Committee’s website HERE.

Notable Quote:

Andrew Gavil, Director, Office of Policy Planning, Federal Trade Commission, Washington, DC, said, “[Licenses] can protect consumers from actual health and safety risks and support other valuable public policy goals. However, that does not mean that all licensure is warranted and, most importantly in our experience, it does not mean that the benefits of all of the specific restrictions imposed on occupations are sufficient to justify the harm they can do to competition and mobility in the workforce. We have seen many examples of licensure restrictions that likely impede competition and hamper entry into professional and services markets, yet offer few, if any, significant consumer benefits. In these situations, regulations may lead to higher prices, lower quality services and products, and less convenience for consumers.”

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EPA's Backyard Blitz Imperiled

House Small Business Committee News - Tue, 07/15/2014 - 12:00am

EPA's Backyard Blitz Imperiled
​By Chairman Sam Graves

President Ronald Reagan once said our “government’s view of the economy could be summed up in a few short phrases: If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.” Twenty-eight years later, anyone who cashes a paycheck, files their taxes, picks up the local newspaper or turns on the TV knows these words ring true just as they did in 1986.

Back home in Missouri, I frequently speak with people who are worried about our out-of-control federal government. It does not take much effort to see what is happening in Washington. Government bureaucrats at the IRS, the Food and Drug Administration and Department of Energy are becoming increasingly aggressive, and the biggest bully of the bunch, by far, is the Environmental Protection Agency.

During this administration, the EPA has overreached time and time again, seeking to accomplish by regulation what normally becomes law through legislation.

Several years ago, the EPA tried to regulate farm dust, which would impact family farms and agriculture producers. Then it went after wood burning stoves used for inexpensive home heating. Now, the president and the EPA are trying to force some of the most crushing regulations on coal power plants in history. What will this mean for my constituents, small businesses and Americans around the country? Higher electric bills.

But few regulations are more damaging and intrusive than the EPA’s proposed rule to give bureaucrats in Washington a stronger foothold in our backyards. The recent EPA and Army Corps of Engineers “Waters of the U.S.” proposed rule would give the government control over thousands of small streams, ditches and ponds on private property, some of which may contain little or no water. In bypassing Congress and without the consent of the governed, the EPA’s egregious agenda is poised to smother economic activity and job growth.

After a lengthy period of intense public outcry and bipartisan objections from lawmakers, including from the Small Business Committee, which I chair, the EPA and the Army Corps of Engineers delayed the rule. This is good, right? After all, a longer period to review this proposal allows Americans more time to voice their concerns to the EPA. However, the agencies haven’t been forthcoming about the rule’s actual consequences for small businesses, which makes it more deceiving and difficult to comprehend.

What we already know is that the EPA’s new federal regulatory scheme employs arbitrary, ambiguous, and confusing terms to vastly expand the size and scope of its authority. Yet, the agencies have failed to assess the impacts of the proposed rule on small businesses as the Regulatory Flexibility Act requires. As a result, the proposed rule is actually creating more confusion for businesses. And, slow-walking its proposed rule will do little to dispel the many fears held by property owners and small businesses around the country. It would be wiser to simply withdraw the rule altogether.

The EPA’s overreach is nothing new. With so much at stake, Congress needs to have more say when the EPA comes out with rules that will significantly impact our economy, and we should be given an up-or-down vote. The EPA should be required to take a second look at regulations already on the books, and further regulation should not take place until this happens.

The president has made clear that his administration will go to any length to enact his environmental agenda. His model of big government is spiraling out of control. Higher costs, more confusion and economic stagnation are all on the way unless the EPA is stopped. Our government is putting the squeeze on middle class Americans and small businesses, and the water rule needs to go. It’s time to close the flood gates on this administration.

Rep. Sam Graves is a Republican from Missouri and chairman of the House Small Business Committee.

Read the article online HERE.

 

Small Contractors Slam The SBA For Inactivity On Reform Implementation

House Small Business Committee News - Tue, 07/15/2014 - 12:00am

The Small Business Subcommittee on Contracting and Workforce, under the chairmanship of Rep. Richard Hanna (R-NY), today held a hearing to examine the slow implementation of the numerous small business procurement reforms included in the National Defense Authorization Act (NDAA) for Fiscal Year 2013. The law was signed by the President on January 3, 2013, yet the regulatory promulgation process has not begun yet.
 
The reforms make various changes to procurement law that help small businesses compete for federal contracts, including making small business goals part of senior agency employee reviews and bonus discussions, preventing contracting fraud by penalizing companies that front for large businesses, and changing limitations on subcontracting to make it easier for small companies to team on larger contracts, just to name a few. Given that most procurement regulations affecting small businesses must undergo a two-step regulatory process by the Small Business Administration (SBA) and the Federal Acquisition Council, these delays make it unlikely that the reforms will be fully implemented before the next President takes office in 2017.

"The slow implementation of these critical small business contracting reforms is extremely disappointing, not only to legislators but also to the small businesses that could benefit from better public policy,” Chairman Hanna said. “Taxpayers want the Administration to actually implement laws which will help grow the economy. Unfortunately, the delay we are witnessing is the real-world consequence of an overly bureaucratic federal government. The priorities of our federal agencies are misplaced and need to change so that the sound policies approved by Congress and signed into law become a reality for American small businesses desperate to grow and create jobs.”

Materials from the hearing are available on the Committee’s website HERE.

Notable Quotes:
Charlotte Baker, President of Digital Hands in Tampa, FL said, “The delayed implementation of this “similarly situated entity” [Section 1651 of P.L. 112-239- subcontracting transparency] provision has negatively impacted the [women-owned small business] community. Digital Hands’ recent experience is a clear example of why this is so important.

“My recommendation is simple: urge the SBA to implement this provision as quickly as possible to bring these necessary changes that impact businesses who are the economic engine in the United States. Thanks to this Committee’s leadership, Congress passed the change; now, the SBA needs to implement it. The longer the delay, the more that all small businesses will continue to miss out on opportunities
.”

Larry Allen, President of Allen Federal Business Partners in McLean, VA said, “I am here today to discuss Sections 1681, 1682, and 1683 of the FY’13 NDAA. Collectively, these laws will limit the liability of companies receiving advice from federally-supported entities on government contracting matters, provide greater clarity about small business suspension and debarment procedures, and provide this body with additional reporting on that process to ensure the fair treatment of small business government contractors.

“Our firm recommends that Congress continue to provide oversight on the SBA’s lack of progress in implementing these three key elements of the 2013 NDAA and take steps to hold senior agency officials accountable for this inaction. Small firms are not getting the benefit of the protections originally envisioned. Businesses that are not truly small are still competing with legitimate businesses for small business work
.”

Angela Styles, Partner at Crowell & Moring, LLP. in Washington, DC, said, “SBA’s failure to act has created significant ambiguity for federal contractors—both small and large.  While this uncertainty keeps the lawyers busy, it costs government contractors—and ultimately results in higher prices for the federal government and taxpayers.”

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Chairmen Urge Labor Secretary Perez To Reverse Davis-Bacon Decision

House Small Business Committee News - Fri, 07/11/2014 - 12:00am

House Small Business Committee Chairman Sam Graves (R-MO) today joined House Education and the Workforce Chairman John Kline (R-MN) and Subcommittee on Workforce Protections Chairman Tim Walberg (R-MI) to urge Labor Secretary Thomas Perez to reverse the Department’s decision to unilaterally extend the Davis-Bacon Act requirements to survey technicians due to inadequate analysis and outreach to industry stakeholders.

Graves, Kline and Walberg wrote in a letter to Perez, “When the department’s Wage and Hour Division (WHD) issued AAM No. 212 along with a guidance letter on March 22, 2013, survey technicians were included under Davis-Bacon for the first time in the act’s history.   For over 50 years, both Republican and Democrat administrations have consistently excluded survey technicians from Davis-Bacon requirements. However, after receiving unsolicited input from the International Union of Operating Engineers (IUOE), the department proceeded to make this unprecedented policy change based solely on the information from the IUOE without consulting any other stakeholders.  To make matters worse, the department made this change through an agency memorandum, rather than the public rulemaking process.  The department’s action in this case has resulted in confusion as to what work is covered by the memorandum and when the change in policy officially began.”   

In 2013, Graves, Kline and Walberg wrote a letter requesting documents and communications concerning its decision to overturn decades of policy and apply Davis-Bacon wage requirements to survey technicians. The Department’s response was significantly delayed and failed to provide all the documents and communications that been requested. However, the documentation provided show that only the IUOE was consulted during the nearly two years the Department considered the change.

As Graves, Kline and Walberg continued in today’s letter, “Based on the most recent documents provided to the committee, it is clear the department worked exclusively with the IUOE to make this significant policy change.  The entire process appears to have started on May 4, 2011, when an assistant for William Waggoner, Business Manager, IUOE Local 12, contacted the department stating that Mr. Waggoner had discussed this issue with then-Secretary Solis at a luncheon and would like to meet in Washington, D.C. to discuss the matter.” 

To read the full letter, click HERE.

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Week Ahead for the Committee: July 14-18

House Small Business Committee News - Fri, 07/11/2014 - 12:00am

Committee to Hold Hearings on the Implementation of Contracting Reforms and Impact of Occupational Licensing on Entrepreneurship

The House Small Business Committee, chaired by Rep. Sam Graves (R-MO), today announced the schedule for the week of July 14, 2014:
 
On Tuesday, July 15, at 1:00 p.m., the Small Business Subcommittee on Contracting and Workforce, under the chairmanship of Rep. Richard Hanna (R-NY), will hold a hearing titled, “Action Delayed, Small Business Opportunities Denied: Implementation of Contracting Reforms in the FY 2013 NDAA.” The purpose of this hearing will be to address the sluggish implementation of the numerous small business procurement reforms included in the National Defense Authorization Act (NDAA) for Fiscal Year 2013. Given that most procurement regulations affecting small businesses must undergo a two-step regulatory process; first being promulgated by the Small Business Administration (SBA), and then promulgated by the Federal Acquisition Council, these delays make it unlikely that the reforms will be fully implemented before the next President takes office in 2017.
 
"Over 18 months ago, the President signed into law small business contracting reform within the FY2013 NDAA, but little progress has been made on the implementation of these reforms,” Chairman Hanna said. “This is a classic example of a bloated bureaucratic federal government that is wasting taxpayer dollars and dragging its feet on the promulgation of important laws. Rather than creating new, untested entrepreneurial development programs, the SBA should focus on completing its core responsibilities efficiently.”
 
On Wednesday, July 16, at 1:00 p.m., the Committee will conduct a hearing titled "Barriers to Entrepreneurship: Examining the Anti-Trust Implications of Occupational Licensing." This hearing will examine whether economic opportunity is being denied by onerous state licensure requirements to engage in certain occupations. Specifically, this hearing will focus on the role that the Federal Trade Commission (FTC) plays in combating the rise in occupational licensure through the enforcement of federal anti-trust laws.
 
“While the intent of occupational licensing may be to provide benefits to the public, there also are potential costs associated with erecting broad regulatory barriers to pursuing work and realizing the American dream. These hurdles are disproportionately high for lower and middle class Americans,” said Chairman Graves. “This hearing will take a good look at whether the state licensing boards, which are typically made up of individuals already working in the profession, are creating broad requirements that unfairly restrict competition and examine the role the FTC plays in promoting competition and ensuring compliance with anti-trust laws.”

Watch the hearing live HERE.

Event Details:
Tuesday, July 15, 1:00 p.m. EDT
2360 Rayburn House Office Building
Small Business Subcommittee on Contracting and Workforce
Action Delayed, Small Business Opportunities Denied: Implementation of Contracting Reforms in the FY 2013 NDAA
 
Wednesday, July 16, 1:00 p.m. EDT
2360 Rayburn House Office Building
Small Business Committee
Barriers to Entrepreneurship: Examining the Anti-Trust Implications of Occupational Licensing       

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Small Business Owners Encourage Congress To Expand Use of Cash Accounting

House Small Business Committee News - Thu, 07/10/2014 - 12:00am

The Small Business Subcommittee on Economic Growth, Tax and Capital Access, under the chairmanship of Rep. Tom Rice (R-SC), today conducted a hearing on the issue of cash accounting, how it affects small businesses, and whether policies should be changed to allow small firms more flexibility in using an accounting method that best suits their operations. Before being elected to Congress, Rep. Rice worked as a tax attorney.
 
According to a survey by the National Federation of Independent Businesses, 41 percent of small businesses use cash accounting, making it the preferred method of accounting for small businesses. Nevertheless, the Internal Revenue Code (IRS) requires that many small businesses in the United States use the more complicated accrual method of accounting for tracking cash receipts and disbursements.

“Today’s witnesses overwhelmingly believe that Washington should expand the use of cash accounting because the majority of small businesses prefer it for their business operations,” said Chairman Rice. “The IRS prohibiting some small businesses from using cash accounting is a perfect example of a government barrier to private sector growth. As a tax attorney, I’ve dealt with small companies who spend too much time dealing with tax compliance requirements that are time-consuming and unnecessary. We should be doing everything possible to make it easier for small businesses to grow and create jobs. In addition, any tax reform proposal that Congress considers should protect and expand the use of cash accounting.”

Materials from the hearing are available on the Committee’s website HERE.

Notable Quotes:
Sarah Windham, Senior Tax Manager of Dixon Hughes Goodman, LLP in Charleston, SC said, “Since their income can fluctuate widely from year to year, accrual accounting, coupled with our progressive tax system, would likely cause farmers to pay more taxes over time than a company in a different industry with stable income over the same time period. Cash accounting allows them to accelerate expenses or defer income giving farms the option to even out their taxable income comparable with long‐term earnings of other industries.”
 
Terry Durkin, Owner of Durkin Associates in Burlington, MA said, “As Congress begins reforming the tax code, I urge you to keep in mind how essential cash basis accounting is to startup businesses, especially micro businesses. I believe Congress can do more to help them. Both Chairman Camp and former Senator Baucus’s proposals are good first steps, but I strongly recommend that Congress go even further.”

Donald Williamson, Executive Director of the Kogod Tax Center at American University in Washington, DC said, “My testimony will describe and highlight the burden placed upon small businesses when the Internal Revenue Code requires them to be on the accrual method of accounting. However, even where the law permits a small business to use the simpler cash method of accounting, the general requirement to maintain inventory records creates burdens that may only influence by only a few months the timing of a small business’s taxable income. Therefore, we urge Congress to not only expand the number of businesses eligible to use the case method of accounting but to also enact a “simplified” cash method of accounting for small business that would further reduce unnecessary record keeping and compliance burdens. We believe such simplification will neither adversely affect the accuracy of tax returns nor impact the ability of the IRS to collect tax.”

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Graves’ Concerns Regarding Obamacare Small Business Program Continue To Go Unanswered

House Small Business Committee News - Fri, 06/27/2014 - 12:00am

WASHINGTON, DC – House Small Business Committee Chairman Sam Graves (R-MO) released the following statement after again hearing from the Obama Administration that no enrollment data or metrics exists for the health care law’s Small Business Health Options Program (SHOP):

“The mismanagement of the Small Business Health Options program is very frustrating,” said Graves. “The Administration isn’t able to answer even the most basic questions about the program’s enrollment or its progress. Going back to last year, the program’s delays and lack of choices have contributed to headache after headache for small businesses who are trying to follow all of the twists and turns of the program. It’s astonishing how little information has been disclosed about a law in which the taxpayers are investing billions. What is the Administration hiding?”

Earlier this month, Graves wrote to CMS Administrator Marilyn Tavenner to request information about the SHOP enrollment for the second time this year. The Administration responded this week with general information about the program, but shared no enrollment data or timetable.

In January, Graves requested enrollment numbers and related information from Health and Human Services Secretary Kathleen Sebelius. The Administration responded in March, a month after the requested deadline, that the metrics were unavailable, but would be available at a later date.

This list of delays and mismanagement of SHOP:

• On April 1, 2013 the Obama Administration announced that the employer health insurance choice on the federal SHOP exchanges would be delayed until 2015, limiting employers to one single plan.
• In June, 2013 a GAO report requested by Chairman Graves confirmed the administration was ill-equipped for the implementation of the SHOPs, showing potential for “implementation challenges going forward.”
• On September 26, 2013 the Health and Human Services Department announced the SHOPs online enrollment would be postponed from October 1 until November, forcing small businesses to enroll using paper forms. That same day, White House Press Secretary Jay Carney clarified the enrollment would begin on November 1, 2013.
• During a Ways and Means Committee hearing on October 29, 2013, CMS Administrator Marilyn Tavenner said the SHOPs would be operating at the end of November.
• On November 22, the administration extended the Obamacare federal exchange signup deadline (for January 1 coverage) from December 15 to December 23.
• On November 27, 2013, the day before Thanksgiving, the Administration announced a fourth SHOP-related delay, postponing online enrollment for a full year.
• On June 10, 2014, CMS delayed the employee choice option until at least 2016, further limiting the breadth of choice.

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Tipton Subcommittee Examines Oil Production and Refining Solutions That Will Lower Energy Costs and Boost Energy Small Businesses

House Small Business Committee News - Thu, 06/26/2014 - 12:00am

The Small Business Subcommittee on Agriculture, Energy and Trade, under the chairmanship of Rep. Scott Tipton (R-CO), today conducted a hearing to examine the disparity between the growing rate of domestic crude oil production and a limited refining capacity, as well as how that mismatch impacts small energy businesses, energy costs, and the broader economy.

“In contrast to a decline in oil production on federal lands, oil production on private lands is growing rapidly. However, the U.S. is not able to enjoy the full economic benefits from this surge because our refining capacity can’t keep up due to bureaucratic barriers,” said Chairman Tipton. “To address our unstable energy and gas prices, we must unleash our abundant energy resources.”

“Today’s discussion on solutions to this emerging problem, whether its easing regulations on refiners or lifting the export ban on domestically produced crude oil, was substantive. The testimony also confirmed that Washington must remove expensive and time-consuming construction and operational permitting requirements and regulations so our energy industry can safely produce and refine oil in a cost-efficient manner, which will reduce foreign imports of crude oil, create hundreds of thousands of new jobs, and help drive down gas prices for overstretched consumers and small businesses.”

Materials from the hearing are available on the Committee’s website HERE.

Notable Quotes:

Russell Smith, Senior Vice President of Quantum Energy in Williston, ND said, “If there is a bottom line message in my testimony today, it is that government regulations have a very real impact on our business and our business planning for the future. Perhaps most important is that uncertainty about overall federal policy toward crude oil refining and market availability has an indisputable impact on how all investors view business opportunities in this sector.”

Jared Blong, CEO/President of Octane Energy in Midland TX said, “While some may think that this [oil and natural production] growth can be attributed exclusively to the “majors” – that is, the larger, independent or integrated oil and gas companies -- let me suggest that the vast majority of the nearly 10 million Americans who work in the energy sector are small business entrepreneurs like me, dedicated to conservation, innovation, efficiency and stewardship -- and our contributions are and will continue to be, instrumental to America’s energy future.”

Kevin Book, Managing Director of ClearView Energy Partners, LLC in Washington, DC said, “My testimony today suggests that even as many Americans celebrate the renewed production of light, sweet crude oil, current production trends may be creating an unstable equilibrium. Domestic crude supply appears poised to outgrow its available outlets under current export policy, creating uncertainty for upstream and downstream investments. Producers may soon see deeper discounts relative to global prices, while refiners must consider whether to commit capital to new infrastructure predicated in large part on these feedstock discounts. In my view, moving as quickly as possible towards a clear and durable policy decision regarding crude oil exports appears to in the interest of all parties.”

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Graves Supports Lowering Gas Prices Bill to Benefit Small Firms

House Small Business Committee News - Thu, 06/26/2014 - 12:00am
House Small Business Committee Chairman Sam Graves (R-MO) today released the following statement in support of the Lowering Gasoline Prices to Fuel an America that Works Act (H.R. 4899):

“Rising gasoline prices harm small businesses and slow the economy. In fact, small businesses face a ratio of energy costs per sale that is 2.7 times what a large company pays. When costs go up, they have to cut jobs, raise prices or postpone major investments in equipment, and the economy suffers as a result. In contrast, developing America’s own energy resources creates good jobs, strengthens national security and boosts the economy. While much of America’s abundant oil and natural gas supply has remained off limits, the average price of a gallon of gas has roughly doubled under President Obama’s red tape policies. This legislation helps streamline the bureaucratic tangle to reduce the price at the pump and create jobs. Small businesses will benefit from a responsible ‘all-of-the-above’ energy strategy that expands production from America’s vast onshore and offshore oil and natural gas sources.”

“Today’s hearing in the Small Business Committee examines the regulatory roadblocks and refining impediments that limit the benefits of domestic energy production and hold back the job-creating innovations that small energy businesses offer.”

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Graves Supports Energy Infrastructure Legislation for Small Business Growth

House Small Business Committee News - Tue, 06/24/2014 - 12:00am

House Small Business Committee Chairman Sam Graves (R-MO) today released the following statement in support of the North American Energy Infrastructure Act (H.R. 3301):

“Advances in technology and new market realities have greatly increased the energy production potential of the United States and its neighbors.  In fact, the energy production sector has been one of the few job-creating bright spots in an otherwise feeble economy.  However, the benefits of this energy bounty won’t be realized until government eliminates needless political meddling and bureaucratic inertia so that abundant North American energy can reach the market.  Building the infrastructure to support North American energy development will improve our nation’s energy security, and create tens of thousands of high paying energy, construction and manufacturing jobs while also promoting stable energy prices. 

 “This week’s hearing in the Small Business Committee also addresses some of the challenges for small energy companies, and the role they can play in a changing energy paradigm.”

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Congressman Sam Graves “Small Business Program Mismanagement Epitomizes Obamacare Incompetence”

House Small Business Committee News - Mon, 06/23/2014 - 12:00am

Congressman Sam Graves “Small Business Program Mismanagement Epitomizes Obamacare Incompetence”
​By Chairman Sam Graves

The Obama administration just can’t seem to deliver on its promises for Obamacare, and the Small Business Health Options Program (SHOP) clearly illustrates this. This program was designed to simplify the process for small businesses to compare health plan costsand select an appropriate plan for their employees, and through competition, bring down costs.  In practice, it has done just the opposite because of a series of missed deadlines and delays. In fact, the program has now been delayed five times since April 2013.

During the Obamacare debate, many questioned the wisdom of granting the government more control over health care, but the botched rollout and implementation of the policy adds an additional concern that this law is leading to further confusion and uncertainty for small businesses.

In the turmoil of the administration’s rollout of Obamacare, the small business program repeatedly fell behind schedule. We first learned of the administration’s inability to deliver SHOPs as planned with their announcement on April 1, 2013, that the employer health insurance choice on the federal SHOP exchanges would be delayed until 2015,

limiting employers to one single plan. That delay was the first of many.

On June 19, 2013, a report I requested from the Government Accounting Office (GAO) confirmed the administration was ill-equipped to implement SHOP and that there could be “implementation challenges going forward.” The report proved to be accurate, because the incompetence continued like clockwork.

On September 26, 2013, the Department of Health and Human Services announced the federal SHOPs online enrollment would be postponed until November, 2013, forcing small businesses to enroll using paper forms. That same day, White House Press Secretary Jay Carney clarified the enrollment would begin on November 1, 2013. CMS Administrator Marilyn Tavenner then further clarified in a congressional hearing on October 29, 2013, that the SHOPs would be operating at theend of November. Just when you thought they were done, another delay was announced on November 27, 2013 while most of the country wasn’t paying attention, the day before Thanksgiving.

The pattern of stops and stutters has continued with the latest delay coming last week!

These delays and lack of choices are contributing to increased premium costs for businesses, which is exactly what Nancy Pelosi and President Obama said wouldn’t happen. To be exact, costs are increasing for nearly two-thirds of small businesses that provide health insurance to their employees, according to a CMS report released in February. Small businesses do not expand and hire when facing increasing costs and confusion, and the administration’s disarray in managing this program is just one more element of uncertainty for small firms in a weak economy.

Topping off the administration’s ongoing and obvious dysfunction is its unwillingness to release basic data about participation in the program. Back in January, I requested enrollment numbers and related information from Health and Human Services Secretary Kathleen Sebelius but received no data. I asked again this month, with no luck. For a President that ran on more government accountability, it’s astonishing how little information is disclosed about a program in which the taxpayers are investing billions.

As a Missouri Representative and Chairman of the Small Business Committee, I will continue to work for transparency from these federal agencies on behalf of small businesses and families. This mismanagement and inadequacy is causing the American people and small business owners to lose trust in their government’s ability to do just about anything. We deserve better.

Read the article online HERE.

Expanded Clean Water Act Rules Hurt Small Business

House Small Business Committee News - Tue, 06/17/2014 - 12:00am

Expanded Clean Water Act Rules Hurt Small Business
​By Chairman Sam Graves

Congress passed the Clean Water Act more than four decades ago to safeguard our nation’s major waterways. These rivers and other bodies of water are sources for drinking water and transportation, known as “navigable waters.” In my northern Missouri district, situated between the Missouri and Mississippi rivers, healthy rivers are absolutely essential to the local economy and farm communities.

The Environmental Protection Agency and U.S. Army Corps of Engineers seem to be losing sight of their fundamental mission and instead are more concerned with expanding their own regulatory footprint. Under a newly proposed “Waters of the United States” rule, thousands of small streams, ditches, ponds and other isolated bodies of water, and lands near them, will be subject to federal jurisdiction and all the regulation, permitting and mitigation that entails. The consequences for millions of small businesses, farmers and local governments could be dire.

Over the years, the agencies’ regulatory interpretation of CWA jurisdiction has been stretched further and further to include bodies of water that have little or no connection to waters that are used for traditional commerce. This proposed rule was touted as necessary to provide more clarity, but is doing the exact opposite by using vaguely defined terms that may be read to include small ponds, ditches or small streams that run only when there is heavy rain. And this extraordinary regulatory intrusion into the lives of many farmers, ranchers and small-business owners has the likely potential to be economically devastating.

Recently, the Small Business Committee, which I chair, held a hearing and heard from small businesses that will be affected by the proposed rule. Alan Parks, an executive with a Memphis, Tenn., stone and gravel company explained the proposed rule’s problems and consequences for small businesses, stating, “The proposed rule has no clear line on what is ‘in’ and what is ‘out,’ making it very difficult for our industry and other businesses to plan new projects and make hiring decisions. If it is determined development of a site will take too long or cost too much in permitting or mitigation, we won’t move forward. That means a whole host of economic activity in a community will not occur — all of this in the name of protecting a ditch or farm pond.”

While the proposed rule clearly has significant consequences for small businesses, the agencies failed to assess those impacts. Had the agencies conducted outreach to and solicited input from small businesses, as required by the Regulatory Flexibility Act, they may have identified and fixed some of the problems with the rule before it was proposed. My colleagues and I on the Small Business Committee have called on EPA and the Army Corps of Engineers to withdraw the proposed rule and examine the real-world consequences of their rule on small businesses before they move forward. Although I appreciate the EPA’s recent decision to extend the comment period, it would be wiser still to withdraw the rule altogether, step back and thoroughly weigh the costs and economic consequences for small businesses.

While all Americans want clean water, they don’t want the federal government to regulate every drop of it. A heavy spring rain shouldn’t result in a bureaucratic bonanza of permits and delays for routine projects and basic activities like cleaning debris and vegetation from a ditch or building a fence near a small stream that merely runs intermittently. Under this proposed rule, however, that will be the result.

Much is at stake. This rule should be halted and subjected to rigorous analysis to ascertain the true benefit, and at what cost to small businesses and landowners. It’s time for the Obama administration to ditch this rule that threatens to drown small businesses in unnecessary regulatory requirements.

Read the article online HERE.

Graves Welcomes Small Business Tax Relief Act

House Small Business Committee News - Thu, 06/12/2014 - 12:00am
House Small Business Committee Chairman Sam Graves (R-MO) today released the following statement on House passage of America's Small Business Tax Relief Act of 2014 (HR 4457):

“The Small Business Tax Relief Act encourages job-creating investment in new equipment. The bill would allow small businesses to plan with the certainty that Section 179 expensing levels are set at $500,000. The tax burden is always one of the top concerns for small businesses, and small businesses need more certainty in order to budget and make long-term plans. Small businesses, farmers and ranchers would greatly benefit from this stability as they consider major purchases of equipment. Often these investments require loans and significant advance planning, and it’s important that small businesses know the Section 179 expensing policy isn’t likely to change in the midst of their planning. This is timely legislation in an economy that did not grow last quarter. Small business growth is a key to the strong recovery this nation needs.”

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Committee Examines Impact of FAA’s 2020 NextGen Mandate on General Aviation

House Small Business Committee News - Wed, 06/11/2014 - 12:00am
The House Small Business Committee, chaired by Rep. Sam Graves (R-MO), today examined the challenges and benefits of the Federal Aviation Administration’s 2020 NextGen mandate for general aviation small businesses.

In an effort to modernize the nation’s aviation surveillance system, as part of its NextGen initiative, the Federal Aviation Administration (FAA) has mandated that by January 2020 all aircraft operating in certain airspace be equipped with advanced technology systems. This hearing will examine the benefits of the 2020 mandate to the General Aviation (GA) industry, challenges GA may face in complying with the mandate, and the importance of both incentivizing and ensuring widespread adoption. 

“The FAA’s 2020 NextGen initiative is an ambitious effort to improve the safety and reliability of air travel through the use of available technologies,” said Chairman Graves, a pilot who also co-chairs the House General Aviation Caucus. “General Aviation plays a vital part in the nation’s commerce, creating jobs while directly and indirectly supporting thousands of small businesses. We commend the FAA’s NextGen initiative goals of reducing congestion and improving safety, but recognize the 2020 mandate creates challenges that could act as barriers to widespread general aviation adoption. We appreciated today’s testimony from FAA Administrator Michael Huerta, owners of general aviation small businesses and leaders of industry.”

Materials from the hearing are available on the Committee’s website HERE.

Notable Quotes:

Michael P. Huerta, Administrator, Federal Aviation Administration, Washington, DC, said, “We are confident that users of the [National Airspace System], including the general aviation community, will see the advantages to ADS-B as they continue to equip and begin using the technology it offers. But, we also realize that increased technology generally requires increased investment for the government, private industry, which includes both large and small businesses, and individual aircraft owners. The FAA has made a significant investment in infrastructure to enable the technology being delivered through NextGen, including ADS-B. We are now calling on users of the NAS to equip their aircraft in a way that allows us to maximize the benefits of NextGen in designated airspace.”

Paula Derks, President, Aircraft Electronics Association, Lee's Summit, MO, said, “…general aviation aircraft owners are ‘on the clock’ as ADS-B installation capacity today far exceeds aircraft owner demand. This inverse relationship will not last unless the industry immediately begins to see 100 or more installs completed per day – a 25-fold increase over the current installation rate.”

Tim Taylor, President and CEO, Free Flight Systems, Inc., Irving, TX, testifying on behalf of the General Aviation Manufacturers Association, said, “…the idea that has been suggested by some that equipage is going to get cheaper as we get closer to the deadline is misleading and a major reason for delay. The prices we are offering for equipage now are artificially low. FreeFlight Systems is making high-volume purchases and we have reduced our margin expectations to get products in the market at an acceptable price point. As volumes start to go up, we will not be able to hold these low prices.”

Bob Hepp, Owner, Aviation Adventures, Manassas, VA, testifying on behalf of the Aircraft Owners and Pilots Association, said, “By creating a fund to provide low-cost guaranteed loans and leveraging existing equipment to provide benefits like improved point-to-point navigation, extended surveillance, and precision approaches at airports not currently served, the FAA can take advantage of the equipment already in cockpits, keep NextGen moving forward, and help GA businesses thrive.”

Kenneth  Button, Director, Center for Transportation, Policy, Operations and Logistics, George Mason University, Arlington, VA, said, “While the initial adoption of ADS-Out in the United States will provide only some of the potential benefits of a full ADS system it, nevertheless, will impact positively in terms of safety and more efficient use of air space… The costs to both the aviation sector and taxpayer are not small, and the expenses of retrofitting part of the general aviation fleet to meet new certification standards by 2020 are equally far from negligible.”

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EPA, Army Corps Extend Comment Period For Rule Clarifying Water Act Jurisdiction

House Small Business Committee News - Tue, 06/10/2014 - 12:00am

Bloomberg BNA: EPA, Army Corps Extend Comment Period For Rule Clarifying Water Act Jurisdiction
By Amena H. Saiyidi
June 10, 2014

 

The Environmental Protection Agency and the U.S. Army Corps of Engineers confirmed that the public has until Oct. 20 to comment on a proposed rule that would clarify Clean Water Act jurisdiction over the nation's waters and wetlands.

The agencies said June 10 that they are granting the 90–day extension from the initial July 21 date in response to numerous requests, including letters from state environmental officials, industry groups and Republican lawmakers.

After a private meeting with several Western governors, EPA Administrator Gina McCarthy told reporters June 10 that some of the governors raised concerns about the proposed rule.

“There's a lot of concern among agricultural interests in their states and what the industry has read into it,” she said. “We need some time to get out there and, if need be, write the rule in a way so the intent is understood.”

The proposed “Waters of the United States” rule, which the EPA published April 21, would bring under federal jurisdiction all tributaries of streams, lakes, ponds and impoundments, as well as wetlands that affect the chemical, physical and biological integrity of larger, navigable downstream waters (79 Fed. Reg. 2,218); (77 DER A-13, 4/22/14).

Interpretive Rule Deadline Extended

The agencies also granted a 30-day extension until July 7 to comment on an accompanying interpretive rule, which took effect immediately. The interpretive rule codified 56 agricultural practices that will be exempt from obtaining Section 404 dredge and fill permits if the activities occur in waters covered by the Clean Water Act.

In a statement, Bob Stallman, president of the American Farm Bureau, called the proposal “a highly burdensome rule” and said, “Rest assured we will use that time to its best advantage. We will ditch this rule.”

The agencies extended the comment period a day before the House Transportation and Infrastructure Subcommittee on Water Resources and Environment is scheduled to hold a public hearing to examine the potential impacts of the joint rulemaking.

In a draft fiscal year 2015 spending bill for energy and water programs, House appropriators included language to bar the corps from writing, promulgating and enforcing the proposed rule.

Rep. Sam Graves (R-Mo.), chairman of the House Small Business Committee, praised the agencies for extending the comment period, saying in a statement June 10, “We told the agencies that they need to listen to America's small businesses, farmers and ranchers about the costly impact of this rule. The decision to give more time for input, as we suggested, is a step in the right direction.”

 

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Graves Welcomes Extended Comment Period for Controversial ‘Waters’ Rule

House Small Business Committee News - Tue, 06/10/2014 - 12:00am
House Small Business Committee Chairman Sam Graves (R-MO) today welcomed the Environmental Protection Agency’s and the U.S. Army Corps of Engineers’ decision, as requested by Graves and other Committee Members, to extend the comment period on a controversial and costly new proposed rule that would expand the reach of Clean Water Act regulations. 

“We told the agencies that they need to listen to America’s small businesses, farmers and ranchers about the costly impact of this rule. The decision to give more time for input, as we suggested, is a step in the right direction,” said Chairman Graves. “It’s clear that the agencies simply didn’t fully assess the impact on small businesses as the Regulatory Flexibility Act requires. It would be wiser still to withdraw the rule, step back and thoroughly weigh the costs and economic consequences for small businesses. As small businesses learn of this proposed rule, they are deeply concerned that ordinary activities on their land may require permits and result in delays, new costs or the loss of productive land. With a district that includes the Missouri and Mississippi rivers, I understand safeguarding our nation’s waters, but the CWA was not intended for small farm ponds or ditches and streams that run during heavy rains. There’s no question that the agencies have overstepped.”

The Committee held a May 29 hearing on the small business impacts of the rule.

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Another Day, Another SHOP Delay

House Small Business Committee News - Tue, 06/10/2014 - 12:00am

House Small Business Committee Chairman Sam Graves (R-MO) released the following statement on Centers for Medicare and Medicaid Services’ (CMS) decision to delay the Small Business Health Options Program (SHOP) ‘employee choice’ option until at least 2016, further limiting the breadth of choice that was originally envisioned, which could lead to increased premium costs.
 
“Today’s announcement from CMS is yet another in a long line of bad news and signs of poor management of SHOP,” said Chairman Graves. “HHS and CMS haven’t answered my inquiries regarding the development of SHOP and it appears that the dysfunction is worse than many of us thought. This pattern of continued delays and confusion is especially disappointing to me and the small business community as many firms grapple with increased health costs. Under Obamacare, costs are increasing for nearly two-thirds of small businesses that provide health insurance to their employees, according to a CMS report released in February. Just imagine trying to run a small company and keep up with all of the changes and delays regarding this law.”

Last week, Graves wrote to CMS Administrator Marilyn Tavenner to again request information about the SHOP enrollment. In January, Graves requested enrollment numbers and related information from Health and Human Services Secretary Kathleen Sebelius. The information has not been produced.

List of previous delays and mismanagement:
• On April 1, 2013, the Obama Administration announced that the employer health insurance choice on the federal SHOP exchanges would be delayed until 2015, limiting employers to one single plan.
• On June 19, 2013, a GAO report requested by Chairman Graves confirmed the administration was ill-equipped for the implementation of the SHOPs, showing potential for “implementation challenges going forward.”
• On September 26, 2013, HHS announced the SHOPs online enrollment would be postponed from October 1 until November, forcing small businesses to enroll using paper forms. That same day, White House Press Secretary Jay Carney clarified the enrollment would begin on November 1, 2013.
• During a Ways and Means Committee hearing on October 29, 2013, CMS Administrator Marilyn Tavenner said the SHOPs would be operating at the end of November.
• On November 22, 2013, the Administration extended the Obamacare federal exchange signup deadline (for January 1 coverage) from December 15 to December 23.
• On November 27, 2013, the day before Thanksgiving, the Administration announced a fourth SHOP-related delay, postponing online enrollment for a full year.

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EPA Review Finds ‘Continued Need' For Regulating Concentrated Animal Feedlots

House Small Business Committee News - Wed, 06/04/2014 - 12:00am

Bloomberg BNA: EPA Review Finds ‘Continued Need' For Regulating Concentrated Animal Feedlots
By Amena H. Saiyidi
June 4, 2014

Key Development: The EPA concludes CAFOs need to be regulated and there is no need to revise the rules to minimize impacts to small businesses.

Potential Impact: Small CAFOs will not get any regulatory relief from the EPA.

June 4 (BNA) -- The Environmental Protection Agency concluded June 4 that there is a “continued need” to regulate concentrated animal feeding operations that discharge pollutants.

Moreover, the agency concluded that “revisions to minimize the regulations' impacts on small entities are not warranted at this time.”

The conclusions are the result of a review of the CAFOs regulations performed under Section 610 of the Regulatory Flexibility Act. EPA agreed in October 2012 to carry out the Section 610 review, which requires an agency to evaluate a rule within 10 years of its promulgation to determine whether it has or will have a significant economic impact on a substantial number of small entities (77 Fed. Reg. 44,494;.

The EPA said the purpose of the Section 610 reviews is to “decide whether the agency should continue a rule unchanged, amend it, or withdraw it.”

Items to Be Reviewed

As part of this review, the EPA sought to address:

• whether there is a “continued need” for the CAFO rule;

the nature of complaints received on this rule;

the complexity of the rule;

• the extent to which the rule overlaps, duplicates or conflicts with other federal, state or local government rules, and

• the degree to which technology, economic conditions or other factors have changed in the area affected by the rule.

Don Parrish, senior regulatory relations director for the American Farm Bureau Federation, was unfazed by the conclusion reached by the EPA, saying, “It took them a while and no real surprise.”

In Minnesota, the farm bureau has sued the EPA seeking to prevent the agency from re-releasing the names, home addresses, global positioning system coordinates and personal contact information of operators and owners of concentrated animal feeding operations in 29 states and releasing such information in six other states in response to freedom of information requests by environmental groups. The case is ongoing (American Farm Bureau Fed'n v. EPA, N.D. Minn., No. 13-1751, 10/2/13)

Mired in Litigation

The CAFO regulations, which were last updated in 2012, have been mired in litigation since the agency promulgated requirements in 2003 that all CAFOs, regardless of whether they discharge, obtain NPDES permits, according to the EPA.

The EPA said the 2012 rule in question is the result of lawsuits by the livestock industry and the environmental community challenging the original 2003 regulation.

The 2012 rule was issued in response to a 2011 appeals court ruling over another CAFO rule, this one issued in 2008, which said EPA will require NPDES permits for CAFOs that discharge or “propose to discharge” and will require voluntary certification for unpermitted operations (73 Fed. Reg. 70,418).

The U.S. Court of Appeals for the Fifth Circuit ruled in March 2011 that EPA could mandate discharge permits only for operations that actually discharge pollutants (National Pork Producers v. EPA, 635 F.3d 738, 72 ERC 2204, 2011 BL 68765 (5th Cir. 2011);51 DER A-42, 3/16/11)).

EPA responded to the Fifth Circuit's ruling with its 2012 rule, eliminating the requirement that CAFOs that “propose to discharge” must obtain NPDES permits. EPA also removed the voluntary certification provision in the 2008 rule in the latest iteration of the CAFO rule.

Rep. Sam Graves (R-Mo.), chairman of the House Small Business Committee, criticized the EPA's review, saying it was inadequate.

“The EPA's continued track record in complying with the RFA is inconsistent and sorely lacking,” Graves said in a statement to Bloomberg BNA June 4. “It is incumbent upon the agency to adequately analyze the impacts of its proposed rules on small businesses and conduct outreach with those that will be affected. The recent ‘Waters of the U.S.’ proposed rule is the perfect example of the EPA pushing out proposals without doing their homework.”

An environmental advocacy group commented that the agency has never done a good job regulating animal feedlots.

“More than 60 percent of CAFOs remain unregulated, more than any other point source in the country owing to the political pressure exerted by the agriculture lobby,” Scott Edwards, co-director of Food and Water Watch Justice, said in a statement. “The 2003 rules have been watered down so much that the only regulatory burden is faced by people who live near these facilities.”

 


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GAO Report Finds Gaps in Collaboration On Federal, State Export Promotion Efforts

House Small Business Committee News - Wed, 06/04/2014 - 12:00am

Bloomberg BNA: GAO Report Finds Gaps in Collaboration On Federal, State Export Promotion Efforts
By GAO Report Finds Gaps in Collaboration On Federal, State Export Promotion Efforts i
June 4, 2014

 

Export Promotion Efforts

Key Development: The Government Accountability Office releases a report examining state, local and federal collaboration on export promotion efforts.

Next Steps: The GAO makes a number of recommendations for improving collaboration, including enhancing federal information-sharing with state trade offices where possible, on the Commerce Department's export promotion efforts.

June 4 (BNA) -- Gaps in collaboration among federal government trade agencies and state trade offices may result in inefficient use of the limited resources available for export promotion, the Government Accountability Office (GAO) said in a report released June 4.

Although the Trade Promotion Coordinating Committee (TPCC) has initiatives designed to advance federal-state collaboration on export promotion, results of these efforts have been limited in part due to the failure to follow consistently key collaboration practices, the GAO said. The GAO's prior work has found that collaboration is enhanced by following key principles such as agreeing on roles and responsibilities and articulating common outcomes.

According to the report, GAO investigators found weaknesses in the implementation of Export Outreach Teams, a TPCC initiative, in the states they visited. The Export Outreach Team concept is a Commerce and Small Business Administration Initiative aimed at strengthening local networks of export service providers.

The report said the TPCC's involvement in an initiative to engage metropolitan areas in export promotion has “unknown implications” for federal export promotion efforts and resources since Commerce does not have a way to monitor the initiative's results. The GAO also said an agreement between Commerce and a group representing state trade offices expired without reaching its collaboration objective.

The report recommended that the interagency TPPC take steps consistent with key practices for collaboration, expand TPPC agencies' collaboration on export promotion with nonfederal entities and enhance information-sharing with state trade offices. The GAO also urged the TPCC to improve implementation of the Export Outreach Teams to better achieve their intended objectives.

Exports Fall Short of Export Initiative Targets

The 2010 National Export Initiative (NEI)—aimed at doubling U.S. exports by 2015—calls on the federal government to step up coordination with state and local partners on export promotion efforts. U.S. exports reached record levels in 2013 but still have fallen short of levels needed to reach NEI targets, the GAO said.

House Small Business Committee Chairman Sam Graves (R-Mo.) asked the GAO to prepare the report. “More than 95 percent of the world's consumers live outside the borders of the United States, and the ability to serve these consumers is important to the future of small businesses and the American economy,” Graves said. “Unfortunately, too many small businesses have difficulty accessing and taking advantage of the variety of federal and state programs intended to help them reach these foreign markets. This GAO report provides important guidance to federal agencies that should help them improve their individual programs as well as better facilitate interagency coordination of federal small business export promotion efforts,” he said in a press release.

 

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