Aug. 1, 2008
NFIB and small business were well represented on Capitol Hill this week. Two NFIB members, John Nicholson and Pete Van De Putte, addressed important challenges currently facing small business owners: high gas prices and burdensome federal regulations. Nicholson, owner of Company Flowers & Gifts Too!, spoke at a press conference hosted by the Senate Republican Conference calling for drilling, and Van De Putte, former NFIB board member and owner of the Dixie Flag Manufacturing Company, testified before the House Small Business Committee on paperwork reduction and the standard home office deduction.
John Nicholson, Company Flowers & Gifts Too!, Arlington, Virginia
The Senate Republican Conference's press conference was held to make it clear to members of congress how badly rising energy costs are hurting small business. Nicholson specifically highlighted the high cost of keeping his delivery trucks running. Nicholson has found that his wholesale flower costs have risen dramatically, too. Nicholson has not raised his prices even though wholesalers have increased delivery fees, and the basic cost of flowers has gone up, too. Both costs increases are a direct result of the rising fuel costs.
Nicholson's remarks were picked up by the New York Times in an article focusing on small business owners that rely on delivery vehicles to run their businesses. Nicholson was quoted in the Times, saying "Higher gas for our van alone runs more than $12 per delivery" though he added that so far he has kept delivery charges at $9.50. "We don't want to discourage our customers from sending flowers." Still, he added, "After a while I guess we'll have to raise prices."
The NFIB Research Foundation was also quoted in the Times article. "The National Federation of Business Research Foundation, which surveys owners via mail every four years about problems of greatest concern, reported in June that energy costs, excluding electricity, were the second most pressing concern after the cost of health insurance. Energy jumped two spots from the earlier survey. The primary expenditure for 38 percent of the companies was to operate vehicles. Most small businesses cannot afford to switch to more energy-efficient vehicles."
Pete Van De Putte, Dixie Flag Manufacturing Company San Antonio, Texas
In front of the House Small Business Committee, Van De Putte's testimony focused on reducing regulatory burdens on small business, specifically paperwork reduction and the standard home office deduction.
"Being a small business owner means, more times than not, you are responsible for everything, including ordering inventory, hiring employees and dealing with the mandates imposed by federal, state and local governments. That's why government regulations, and the paperwork they generate, should be as simple as possible," said Van De Putte in his testimony.
Home based businesses are one of the fastest growing segments of the economy, representing 53 percent of all small businesses. While the rate of new and home-based businesses continues to grow, the existing home deduction remains burdensome and complicated. It requires a small business owner to determine how much of their house is used for business and to keep detailed records that substantiate the deduction. The complicated record keeping now required by the IRS to qualify for a home office deduction is a barrier to many who would qualify but do not have the time and staff to do the paperwork. That barrier would be removed if a standard deduction for home-based businesses were allowed.
Van De Putte owns Dixie Flag Manufacturing, which celebrated its 50th year in business this year. The business, started by his parents and grandmother in the bedroom of his family home has grown to employ more than 40 people. Van De Putte is a former NFIB board member and a founding member of the NFIB Texas Leadership Council.
