May 11, 2011
Keeping tabs on the government is a big responsibility for the National Restaurant Association, one of the most powerful trade organizations in the U.S. The Association represents all types of restaurant and foodservice concepts, including quick-service, fast casual, managed foodservice, casual and fine dining, along with manufacturers, suppliers and distributors, for an industry of 960,000 foodservice outlets and 12.8 million employees.
Restaurant Hospitality’s Megan Rowe asked president and c.e.o. Dawn Sweeney to recap some of the last year’s most important national developments affecting foodservice operators.
What are a few of the biggest advocacy victories the Association has scored in the last year?
Sweeney: First, the tax relief package that was signed into law at the end of 2010 included extension of the restaurant depreciation provisions. It also included a pro-vision that enhanced charitable deductibility for contributions of food. Also the Work Opportunity Tax Credit was extended. Next, the passage of the FDA Food Safety Modernization Act provides some meaningful improvements in food safety. Third, we will have one national labeling standard for chain restaurants with 20 or more locations that operate under the same brand. A national standard will preempt all kinds of state, county and local mandates. There is a liability provision within this bill for protecting restaurants that comply with the federal standard. The regulations were released in March, and we think the government will allow about a year for the comment period.
Then there is the Travel Promotion Act. We have been trying for several years to create an environment to aggressively market the U.S. as a great travel destination. Our industry is heavily dependent on tourism; some segments rely as much as 40 percent on business from international travelers. So now there is a corporation for travel promotion with a 12-person board. Two of the board members are restaurateurs: Roy Yamaguchi of Roy's and Dan Halpern of Jackmont Hospitality.
We activated what we call the Win 2010 strategy. The essence was to help elect more business-friendly members of Congress. It was extremely successful. We supported almost 80 competitive House and Senate candidates, and our victory rate was about 84 percent. With 13 new senators and 92 new house members, we have a great opportunity to educate and support these folks.
Is the Employee Free Choice Act still under debate?
Sweeney: Given the present makeup of the House of Representatives, with a Republican majority, we feel that from a legislative standpoint we have a reprieve for the moment. But the National Labor Relations Board, which oversees many of these same issues, is taking action on EFCA-like labor reforms. We’ve filed amicus briefs on such proposals one that requires employers to hang a poster in each workplace informing employees of their rights to organize. We are still actively engaged.
What about proposals to increase the percentage of business meals that would be deductible? In this economic climate, is that wishing for too much?
Sweeney: That’s where we are right now—a bill introduced this year by Arizona Congresswoman Shelley Berkley that would increase deductible amount to 80 percent. It will probably be tough to get passed this year, but we continue to fight aggressively to get the word out about the role restaurants play in the economy and in jobs creation and the role of small businesses in our country.
What’s up with the drive to simplify 1099 paperwork?
Sweeney: We’re making some progress with that. There has been an outpouring of incredible negativity around this. It’s insanity that small businesses have to file a 1099 for any single vendor engagement that involved more than $600 a year. We are hopeful about this one, since it’s a truly bipartisan issue. We are optimistic that the rule will be repealed.
What other issues are demanding more of NRA’s resources these days?
Sweeney: One big one is excessive debit card interchange swipe fees (what banks charge businesses for accepting cards). For many restaurants this is the third or fourth highest expense after labor, rent and food. We’ve been engaged for several years in a merchant payment coalition. The coalition includes a lot of retailers and convenience stores. We are supporting Rep. Dick Durban’s amendment to make sure fees authorized by the Federal Reserve Bank on these transactions are reasonable and proportional. The amendment would allow restaurants to set a minimum amount for credit card transactions and allow customers to get a discount for cash. Healthcare reform is still a huge issue on our radar screen. Obviously, politically it’s not likely the act will be repealed, but we are very concerned as one of nation’s largest job creators that this bill as currently written really negatively impacts industries like ours that are very labor intensive. We would like to eliminate the employer mandate, the provision of the law that says the employer is ultimately responsible to make sure all employees have insurance. There are a lot of cost drivers in our insurance and healthcare sys-tem, and we would like to identify those and bring those down. The goal would be for affordable health insurance that would work well for a low-profit, high-labor industry like ours.
How does the Association track what is going on at the state and local level?
Sweeney: Many of the emerging issues start in state and local arenas: banning of packaging materials, drive-throughs, water bottles and so on. These can quickly catch fire and become national issues. We have quarterly meetings with all state association c.e.o.s where we review all the issues. They have an elected council of 13 people who represent them each year. That council and our senior executive team meet quarterly. When an issue does come up and a pattern emerges, we’re getting in there and getting that precedent for the first situation set properly so over time we don’t have a patchwork of negative out-comes that comes to the federal level. It’s really a matter of taking the resources of the whole industry and bringing them to bear.
What are some underused tools or resources that the Association offers to members?
Sweeney: One of the metrics we’re using to measure our success is how aware our members are of the tools and solutions we provide. There’s always a gap between what is available and what the customer is aware of. Our goal is to close that gap. If you operate in one community your needs are different from a regional operator. Our challenge is to do a better job of matching the tools and solutions with each individual member type. We’re also developing our premier products at the national level—the ServSafe certification program is pilot testing several new products for both the man-ager and employee levels. We are also testing some health insurance products. And the NRA Show is also one of the greatest opportunities to get engaged. It gives you a 360-degree view of the organization in one spot.
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