It was certainly a pleasure to spend some quality time earlier this week with AMBA members who made the trek to Washington for our Advocacy Day event. As I mentioned last week, it’s important for Members of Congress and their staff to hear directly from you—the constituent and job creator—about what the federal government can do—and not do—to make your lives easier.

One of the highlights for me was the issue briefing on Monday, where our members addressed the group on some of the more detailed intricacies of our policy priorities. Tax issues can be daunting and overly complicated, but we all came away with a clearer understanding of why bonus depreciation matters and why Congress must act to restore this critical benefit.

Another highlight for me was a Hill meeting in which I participated with the Massachusetts group. We had asked for a meeting with Senator Markey but ended up in a conference room with his staff. I have found that it can be very difficult to secure meetings with some Senators from Northeastern states. Anyhow, we were in the middle of a conversation about the Credit Card Competition Act and in walks Senator Markey to greet our group. We hit him quickly on the need for action on the tax bill and he gave us the thumbs up that he is fully on board and we need to convince Republicans to act now and get this legislation to the President.

As with any event, there is always room for improvement, and we have taken notes on some areas on which we will focus for next year. But from my perspective, I thought things went well, and the groups that I walked the halls with seemed pleased and that their time was well spent.

Updates on the Farm Bill

This week featured some significant developments on reauthorizing the Farm Bill. As we have mentioned, this statute—reauthorized every five years—is important to the wood building products sector as there are many provisions in the Forestry and Energy titles that seek to promote markets for renewable, sustainable building products. 

On Tuesday, House Agriculture Committee Chairman Glenn Thompson (R-PA) rolled out a high-level summary of what his bill will look like. We have been told by his team that the legislation will renew the Community Wood grant program that promotes development and production of innovative wood products, as well as heating and renewable energy technologies that rely on sawmill residuals. His bill will also reauthorize the Wood Innovation Grant program and includes provisions to promote active forest management on our nation’s federal forest landholdings. On workforce, we have been told by committee staff that there will be language based on the Jobs in the Woods Act to standup training programs around the country to entice young adults to enter the forestry and forest building products workforce.

We are hearing that a markup on this legislation will take place on May 23. Specific legislative text should be available a few days before the markup. And then the following day, Senator Debbie Stabenow (D-MI), Chairman of the Senator Agriculture, Nutrition and Forestry Committee unveiled a 94-page summary of her version of a Farm Bill. Her legislation, which is not supported by her Ranking Member Senator John Boozman (R-AR), doubles the funding for the Community Wood grant program to $50 million a year over the life of the Farm Bill. That amounts to $250 million—a significant investment in the wood building products sector. Her bill also makes changes and beefs up the Bio Preferred program, which is a procurement preference and labeling program for biobased products, which includes wood building materials. 

There is no sense yet when the Senate is looking to move on this legislation or when legislative text will be available.

Contact:
Francis Palasieski
Director of Government Affairs
American Building Materials Alliance
Direct Line: 518-880-6376

American Building Materials Alliance (�������ý) Hosts Successful Advocacy Day in Washington, D.C.

Washington, D.C. – April 30, 2024 – The American Building Materials Alliance (�������ý) convened its highly anticipated Advocacy Day on April 29th and 30th in Washington, D.C., with an impressive turnout of over 60 dedicated members flying in for the two-day event. Addressing a range of critical issues impacting the industry, the event showcased �������ý’s commitment to driving tangible progress in key areas such as renewing Trump-era tax benefits, enhancing the CDL licensing process, prioritizing workforce development, and tackling the challenge of exorbitant credit card fees.

The event kicked off on Monday afternoon with a comprehensive issue briefing at the Hamilton Hotel’s filled ballroom. Pat Rita, ABAMA’s Government Affairs Associate, provided key insights into the legislative agenda, supported by firsthand accounts from industry leaders. Claudia Homan, CFO of Bethel Mills (Vt.), shed light on tax-related challenges, while Eric Murphy, Purchasing, Marketing, and IT Manager at East Coast Lumber Building Supply Co. (N.H.), underscored the urgency of streamlining the CDL licensing process to mitigate workforce shortages. Doug Ford, VP of Public Relations & Purchasing at Curtis Lumber (N.Y.), lent a personal perspective to workforce development initiatives emphasizing the real-world impact of these issues. Members engaged in dynamic discussions, particularly emphasizing the detrimental effects of high credit card fees and the important role of tax incentives in fostering small business competitiveness.

The briefing culminated in a presentation by Bruce Lundegren, Assistant Chief Counsel at the US Small Business Administration, who shed light on the challenging regulatory landscape confronting businesses in the LBM (Lumber and Building Materials) industry. Lundegren underscored the SBA’s unwavering commitment to safeguarding small businesses amidst these challenges.

Central to Lundegren’s address were the pressing issues surrounding OSHA regulations and the proposal of new ‘heat rules’. With a keen understanding of the complexities involved, he outlined the SBA’s proactive stance in advocating for policies that balance regulatory compliance with the unique operational needs of small businesses in the LBM sector.

On Tuesday, �������ý members engaged in a series of impactful meetings on Capitol Hill, advocating for their priorities directly with legislators. Notable highlights included the Maine delegation’s meeting directly with Senator Susan Collins to champion the renewal of critical tax incentives and the New York delegation’s private tour of the Capitol with Representative Elise Stefanik, House Republican Conference Chair. The Vermont delegation’s constructive dialogue with Senator Bernie Sanders’ team yielded commitments to enhance key aspects of �������ý’s workforce development agenda.

Reflecting on the event’s success, �������ý Chair Joe Cecarelli expressed satisfaction, stating, “�������ý’s Advocacy Day was a resounding success. Our alliance stands stronger than ever, and our members have made significant strides on issues vital to our industry.”

Doug Ford, Chair of the Northeastern Retail Lumber Association (NRLA), lauded the event as unparalleled in its effectiveness, noting, “This was by far the most productive advocacy trip to D.C. in my experience. We achieved meaningful progress across the board, bringing many of our pressing issues to the brink of reaching the President’s desk.

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We are looking forward to seeing many of you in Washington next week for �������ý’s Advocacy Day. Staff is finalizing preparations for what promises to be a successful couple of days in our nation’s capital. Like last year, dozens of meetings have been scheduled with key Members of Congress and/or their staff and we expect many productive discussions on the suite of our federal public policy priorities.

It’s important for organizations like ours to come to Washington on the regular for a number of reasons. One, while Members of Congress and staff expect to interact on a daily basis with government affairs consultants based in D.C., they prefer to speak directly with the actual job creators in their states and districts. Only you know the intricacies of your business and the daily challenges and opportunities you face. And it is refreshing for these Members to hear from business owners and employees in plain terms what is on their minds instead of the word salady “Washington speak” to which they have grown accustomed. 

Another benefit of in-person visits is that these interactions often set in motion follow-up visits where the Member shows up at your operation for a yard tour. When we have Hill meetings when you are not here, we focus on our policy priorities and strategies for moving them forward. The prospect of a yard tour back in the district just does not emerge as organically as it does when �������ý members are conversing face to face with their elected officials. It just seems to happen naturally during these Advocacy Days and that’s a positive.

Again, we are looking forward to seeing you. Remember to relax and be yourself in these meetings and just have fun with it. You have likely forgotten more about what your business does, what you do and the contributions you make to your community than they will ever know.

In terms of dress code, Washington remains one of the last bastions that is clinging to business attire. A word of caution, however. If you have a pair of great looking shoes that you really love but hurt your feet, leave them at home. Lots of walking is in your future next week so choose comfort and practicality over style. You’ll be tired at the end of the day, but it will be a “good tired.”

See you on Monday!

EPA Power Plant Rulemaking

On Thursday, EPA rolled out a suite of final rules seeking to control air and water pollution from our nation’s coal-fired power plants. The announcement marks yet another major regulatory move by the Administration in an attempt to lock in President Biden’s policies ahead of the November election and protect them from a Congressional Review Act override.

The rules impose stringent air quality controls on electric utilities which will force coal-fired units to either shut down or commit to investing in carbon capture technology. The rule also applies to new natural gas-fired utilities and requires both to ultimately control 90 percent of their carbon pollution. The other rules in the package tighten mercury and air toxics standards at coal-fired facilities as well as wastewater discharge and coal ash ponds at these units.

�������ý is monitoring this rule package out of concern with increased power costs for businesses like ours. There will likely be litigation challenging the rules and we will report on developments.

White Oak Legislation Introduced

A bipartisan group of House members have introduced , the White Oak Resilience Act, legislation intended to prevent the supply of white oak lumber from dwindling to unsustainable levels as market demand for the material remains high. Specifically, the bill would establish pilot projects for the U.S. Forest Service “to regenerate white oak where appropriate” and empowers the Civilian Conservation Corps to “plant white oak and associated hardwoods.” While foresters do not generally recommend planting hardwood species as they regenerate naturally, the situation with white oak is concerning and has even spawned an organization dedicated solely to it– . The impetus for this organization originally came from the bourbon industry out of concern for white oak supply to make bourbon barrels. 

The bill has been referred to the House Agriculture Committee and we will keep our eyes on it.  

EPA Formaldehyde Action

The Environmental Protection Agency is moving forward with a proposal to ratchet down the workplace exposure level to formaldehyde to 11 parts per billion (ppb). This threshold is extremely low and below background levels for most exposure situations. In fact, this level is only slightly above the level exhaled in human breath. Moreover, it is far below the OSHA Permissible Exposure Level of 750 ppb and also lower than the recently determined European Union Occupational Exposure Level of 300 ppb.

The action is particularly concerning for wood products manufacturers as formaldehyde occurs naturally in wood. Moreover, formaldehyde is present in off gassing associated with glues in composite wood products. Public comments are being prepared by trade groups representing the wood manufacturing sector. We are close to these groups and will provide those comments when a draft is available. 

While we are at Advocacy Day speaking with our legislators there are three important boxes to check – communicate our policy goals, explain who we are, and make a connection. 

Meeting with legislators and telling them what bills we support is important, but what makes your voice powerful is sharing your real-world experiences and stories as they relate to the issues. Our conversation should focus on why these issues are important for our members. Explaining who we are and what we do as an industry is also equally important. Many legislators have never heard of the lumber and building materials (LBM) industry, and those that have may not understand what it really is.

A member recently said that the LBM industry is “the largest industry that no one has ever heard of.” It is important that legislators understand who we are so that they can understand why our issues are important. Talking about what your business is and what you do is an essential part of Advocacy Day. It goes hand in hand with the policy and displays how the real-world examples you provide matter. 

I encourage you to be yourself in these meetings and to share your experience in the best way you know how. Don’t worry about diving into the complicated language and details of the bill, that’s your congress person’s job. Your job is to tell them your story and the story of LBM to help them better understand what needs to be done.

CDL Licensing

For example, the SHIP IT Act, which includes improvements and incentives relating to obtaining a CDL license and pursuing a career with it, is crucial. Members from all over talk about the shortage and how hard it is to find the folks we need. They discuss how the training requirements are expensive and go well beyond what our drivers need.

Rather than concentrating your discussion around the ins and outs of the legislation itself, share the story of a small business struggling with the daunting process and expenses of obtaining a CDL license, either for yourself or your employees. By explaining the hurdles faced and the implications for your business operations, you can emphasize the urgent need for initiatives like the SHIP IT Act.

Credit Card Fees

Credit card swipe fees are high, and many of them cannot be negotiated. Our members see fees all over their bills with little explanation or information about what they are for or why they are the price they are. However, instead of solely discussing the economic implications of swipe fees, talk about your own frustrations with the lack of transparency and control over these charges in your monthly statements. Don’t be afraid to use real numbers. By highlighting the financial strain and obstacles encountered, you can underscore the critical importance of reforms like the Credit Card Competition Act in leveling the playing field for small businesses like yours.

Business-friendly Taxes

Extending and renewing tax credits for R&D and immediate expensing will create a business-friendly tax climate. This is important for our members because it allows them to invest in their business and their employees. It allows them to buy new equipment, which supports jobs and grows the business. But rather than solely focusing on the potential cost benefits of tax credits and expensing provisions, consider sharing how you’ve utilized these incentives to invest in workforce development and equipment upgrades, driving innovation and job creation within your company. By showcasing tangible examples of how such legislation directly impacts your business operations and employee livelihoods, you can underscore its significance.

WIOA Reauthorization

The Workforce Innovation and Opportunity Act (WIOA) Reauthorization (H.R. 6655) will allocate funding to upskill the American workforce, prioritize employer-led initiatives, and ensure displaced workers access skill development programs. Finding qualified employees and retaining them has been an issue for our members. Share what you are witnessing with these struggles with workforce shortages and skills gaps, either within your own company or across the LBM industry. By highlighting the challenges faced in recruiting and retaining qualified talent, you can underscore just how important initiatives like the WIOA Reauthorization are in equipping workers with the skills needed to thrive in the modern economy. Tell your legislators what the industry is already doing to address these shortages.

Why it Matters

Making a connection with a legislator is perhaps one of the most powerful things you can do while in D.C. Opening a line of communication can create a lifelong relationship while at the same time allowing �������ý members to carry real weight. At the end of your meetings, do not hesitate to ask the legislator to share the best way to contact them. You will be surprised; many will share more than a generic business card. Some might even share their personal contacts. Legislators actively seek out individuals who have insights into complex issues; they appreciate and need the perspective of people outside the Capitol. 

I am looking forward to seeing all of you in D.C. in eleven days, and I am looking forward to making pizza with my kids this weekend. It’s a good thing one is coming before the other because homemade pizza with the kids is hard to beat.  

In addition to reauthorizing and fully funding all the workforce development programs embedded in WIOA the bill would:

• Dedicate 50 percent of the adult and dislocated worker funding toward upskilling workers through “individual training accounts” (ITAs).
• Manages the nation’s network of One-Stop Career Centers.
• Administers the Job Corps program with increased performance accountability.
• Streamlines the application process for “eligible training providers” to promote faster eligibility determinations and minimize administrative burdens for training providers active in multiple states.
• Encourages innovative sector partnerships by allowing states to invest in critical industry skills initiatives.
• Authorizes state and local workforce boards to aid employers in implementing skills-based hiring practices.
• Places greater emphasis on work-based learning for youth and on workforce education programs at community colleges that align with in-demand jobs.
• Establishes grant programs that support employment and training services for formerly incarcerated individuals.
• Strengthens the workforce data system by promoting the use of real-time labor market information, facilitating access to wage records data and promoting data transparency.
• Incentivizes regional consortia for workforce development areas so that workforce development boards may ensure that jobseekers are connected to industries and employers that are prominent in a region’s economy.

To read the fact sheet for A Stronger Workforce for America Act, .

To read the summary for A Stronger Workforce for America Act, .

To read the section-by-section for A Stronger Workforce for America Act, .

The bill now proceeds to the Senate where its path forward is uncertain. �������ý will be checking in with the Senate Health, Education, Labor and Pensions (HELP) Committee staff to obtain a better sense of the upper chamber’s plans on this issue/legislation.

Also, for those who missed Thursday, here is an overview of WIOA Reauthorization. The recording of that second briefing will be coming soon!

Get ready to dive deeper into �������ý Advocacy Day 2024! Join �������ý staff virtually on Microsoft Teams on Wednesday, April 17, and Thursday, April 18, from 12:00 PM to 1:00 PM (EST). Don’t miss out, !

These sessions will offer a comprehensive overview of �������ý Advocacy Day 2024, ensuring attendees understand what to expect. We’ll also be joined by �������ý’s Government Affairs Associate, Pat Rita, for a closer look at �������ý’s 2024 Legislative Priorities, shedding light on critical industry issues and providing insights on D.C. developments.

While attending one or both sessions is encouraged, it’s not mandatory—we recognize busy schedules. However, your participation is crucial in shaping our advocacy efforts, so if you are unable to attend, please feel free to forward any questions to Francis and Nicolina. Both sessions will be recorded and shared, along with any related documents and links, for your convenience.

We aim to ensure all �������ý members benefit from these briefings, so the more questions, the better! Missed our last session or need a recap? Find it here. Don’t miss this chance to gain valuable insights and contribute to our advocacy efforts!

We’re excited to connect with you all!

�������ý is hearing that Senate Finance Committee Chairman Ron Wyden (D-OR) is planning to introduce legislation soon that would amend the Lacey Act, a statute enacted in 1900 to combat illegal trafficking in wildlife, fish and plants. The law was amended as part of the Farm Bill in 2008 to include trees and products derived from them, including wood building materials and pulp and paper. At that time, the wood products and pulp and paper sectors supported the Lacey Act amendments (as they were known) as a way to preclude illegally harvested timber from flooding the U.S. market at prices that undercut U.S. producers. The law requires importers to submit import declarations on wood and wood products coming into the U.S., noting the species, import value and country of harvest among other information. It also requires importers to exercise “due care” in ensuring all wood products are derived from legally and sustainably managed forests. There are serious penalties for non-compliance.

While U.S. wood products and pulp and paper manufacturers continue to support the intent of Lacey, there have been hiccups with implementation and enforcement since 2008. Among other things, Senator Wyden’s bill would require that the Animal and Plant Health Inspection Service (APHIS) immediately begin enforcing Phase 8 of Lacey, which is the import declaration requirement on pulp and paper. Complexities with tracking the various sources of wood and wood fiber that end up at a pulp and paper mill has stalled implementation of this last tranche of affected entities. While that provision will not affect our sector, �������ý is monitoring the situation closely in the event that the legislation veers into areas affecting wood building products.

There is considerable activity in this space of late. The European Union has enacted its EUDR—the European Union Deforestation Regulation which probits wood and pulp and paper (among other commodities) from entering the EU marketplace unless the producer can prove that that product is derived from a legally harvested and sustainable forest. The EUDR is creating major angst for U.S. companies as it imposes a geolocation requirement whereby producers have to be able to identify the exact parcel of land where the lumber is sourced.  Here in the U.S., the World Wildlife Fund and the Environmental Investigation Agency are making the rounds with various groups on Lacey Act-related policy issues and there is also legislation proliferating at the state level.

Tax

Members of Congress return next week after a two-week recess. We are watching developments on the tax front closely as Senate Majority Leader Chuck Schumer (D-NY) was signaling that he intended to bring up the House-passed tax bill (H.R. 7024) for a vote on Senate floor—bypassing Senate Finance Committee consideration. �������ý has been visiting with key Senate staffers and representatives from other trade groups that are working this issue. What we are hearing is that Leader Schumer may be reluctant to move quickly to a Senate floor vote as it threatens to poison the well with Senate Republicans and may have serious repercussions for negotiations on other policies/legislation. However, the politics are intriguing for Democrats as forcing a vote in the Senate would put Republicans on record as opposing key business tax benefits (100 percent bonus depreciation, R&D tax credit) as well as the Child Tax Credit. The situation is fluid, but �������ý is close at hand and will report on our efforts and developments.

Congress

Members of Congress are back home in their states and districts this week and next and will return to town on April 9.

With President Biden signing the second of two appropriations packages last week to fund the federal government through the end of the fiscal year, there is no rest for the weary on the appropriations front. The fiscal year 2025 appropriations process is already underway with Congressional offices accepting appropriations requests in advance of the appropriations committees fashioning the 12 bills that fund all of the federal departments and agencies that make up the federal government footprint. Committee action is expected later this spring.

Regulatory Machine on Overdrive

The Biden regulatory agenda will be overly active in the coming weeks as the President seeks to solidify his legacy on policies ranging from climate and other environmental issues to labor. Evidence of this is already occurring with the recent unveiling of EPA’s final tailpipe emissions rule affecting light and medium-duty vehicles beginning in model year 2027. Before that announcement, the Administration finalized the Securities and Exchange Commission’s climate disclosure rule as well as the Department of Labor’s independent contractor rule. The sense of urgency is tied to two factors—the potential change in who occupies the White House next year as well as the Congressional Review Act or CRA.

The CRA is a little-known (outside of Washington) parliamentary tool whereby the next Congress—in this case, the 119th Congress—may repeal rules and regulations issued in the previous year. A Congressional Review Act resolution only needs a simple majority in the House and Senate to pass Congress and then, of course, needs to be signed by the President to take effect. This “lookback” provision is limited to the final 60 working days of the previous Congress, which is a bit of a moving target since it is not known right now when Congress is going to adjourn. Based on history, the 60 working-day lookback reaches at least into June but can extend to May or even April of the previous year.

Given the specter of the CRA, the Biden Administration is on the clock and is accelerating the finalization of rules and regulations so that they are not subject to this parliamentary procedure.

�������ý is close to the action and monitoring developments from departments and agencies that oversee policies that affect our sector. As always, we will keep you regularly informed.

Workforce

In meetings in the House and Senate recently, �������ý has picked up that Representatives Glenn “GT” Thompson (R-PA) and Suzanne Bonamici (D-OR) will be circulating a “Dear Colleague” letter in the House soon asking for appropriations support for the Perkins Basic State Grant. Thompson and Bonamici are co-chairs of the Congressional Career and Technical Education (CTE) Caucus.

Each year under the Perkins statute, Congress appropriates approximately $1.4 billion in State formula grant funds under Title I (Basic State Grants) to develop more fully the academic knowledge and technical and employability skills of secondary and postsecondary education students who elect to enroll in career and technical education programs. This letter will purportedly be calling on appropriators to provide robust funding for the Perkins Basic State Grant. As soon as we have a copy of the letter, we will provide that to you.

SUPPORT

Focused on introducing competition into the credit card network market, presently dominated by the Visa-Mastercard duopoly, the Credit Card Competition Act (CCCA) has stood as a key legislative priority for �������ý since its first introduction in 2022. In addressing concerns about inflation and escalating prices, the CCCA’s broader impact is anticipated to positively influence consumer spending and provide relief to small businesses grappling with the financial strains associated with high transaction fees.

As retailers grapple with substantial swipe fees, ranking just below labor costs, their ability to invest in expansion is stifled. The year 2022 witnessed a staggering $126.4 billion in swipe fees paid by U.S. retailers, marking a significant 20% increase from the preceding year. With a resounding 81% of consumers backing legislation aimed at fee reduction, and 73% expressing trust in small businesses over large banks for advocating fair policies, it is evident that consumer sentiment favors change.

Here’s How the CCCA Will Help:

• Increased Payment Options: The act stops credit card networks from limiting the number of networks businesses can use for transactions. This gives retailers more choices, leading to better service and lower fees.
• Routing Flexibility: This prevents networks from controlling how transactions are routed, so businesses can choose the fastest or cheapest options. This could save retailers money and make transactions smoother.
• Security Technology Adoption: Under this provision, networks are unable to force businesses to use security tech that only works with one network. This encourages the adoption of security measures that work across different networks, making transactions safer for everyone.
• National Security Considerations: By mandating the creation of a public list identifying networks with security concerns or foreign ownership, the act aids businesses in recognizing potential threats, allowing them to make informed decisions regarding their payment collaborators.

�������ý strongly supports the CCCA as it aims to empower merchants, promote better service, and reduce costs, fostering a fairer credit card market. We urge lawmakers to prioritize the passage of S. 1838 to bring about positive changes in the credit card market.

Download our comprehensive PDF guide to discover more about the Credit Card Competition Act and ways you can contribute.

On Thursday, the House Education and Workforce Committee reported H.J.Res. 116 on a party line vote of 21-13. The measure is known as a Congressional Review Act (CRA) resolution and, if passed and signed into law, would nullify the new Independent Contractor rule that took effect last week. That rule rescinds the 2021 independent contractor rule issued under former President Donald Trump and replaces it with a six-factor test that considers:

1. opportunity for profit or loss depending on managerial skill
2. investments by the worker and the potential employer
3. degree of permanence of the work relationship
4. nature and degree of control
5. extent to which the work performed is an integral part of the potential employer’s business; and
6. skill and initiative.

All six factors are weighed equally in determining status. In other words, it makes classifying as an independent contractor much more difficult.

As we know, the independent contractor model is relied on heavily by the trucking industry. In fact, over 350,000 drivers on the road today choose to operate as independent contractors and the American Trucking Association has been a vocal opponent of the proposal. During the markup Thursday, Chairwoman Virginia Foxx (R-NC) had this to say: “Allowing for entrepreneurship through pursuits such as independent contracting is how we will repair the American economy, not through bad government regulations that destroy the freedom to work independently.”

Senator Bill Cassidey (R-LA) has introduced a similar resolution in the Senate. While these CRAs are helpful in messaging opposition to the new rule, they are unlikely to pass. Even if the measure were to clear the Democrat-controlled Senate, it would most certainly be vetoed by President Biden and the votes would not be there to overturn a veto.

�������ý Signs Coalition Letter to Delay CTA

Last week, �������ý signed onto a letter here: urging the Chair and Ranking Member of the Senate Banking Committee to pass legislation delaying the compliance deadline for the Corporate Transparency Act. Despite a favorable court striking down the CTA as unconstitutional, we have come to find out that the ruling applied to the plaintiffs only – members of the National Small Business Association (NSBA). The letter points out that—

 FinCEN (Treasury’s financial crimes unit) indicated it would continue to enforce the CTA against all small businesses and other entities not named in the lawsuit. This decision effectively creates two classes of small businesses: those that were members of the NSBA as of March 1st will enjoy the protections of the Constitution while the remaining 32 million small businesses targeted by the CTA will not.

Meanwhile, many small business owners will hear about the ruling and conclude that they are no longer obligated to comply, unaware that they are making themselves vulnerable to the CTA’s stiff fines and criminal penalties. FinCEN, meanwhile, has no practical means of distinguishing between NSBA members and other small businesses. The NSBA’s membership is not public, and the courts have previously ruled that the government cannot compel trade associations like the NSBA to turn over their membership lists. 

Legislation to delay CTA implementation is S. 3625, the Protect Small Business and Prevent Illicit Financial Activity Act, introduced by Senator Tim Scott (R-SC). The House companion is H.R. 5119, introduced by Representatives Zach Nunn (R-IA) and Joyce Beatty (D-OH), which passed the House of Representatives on a bipartisan vote of 420-1 on December 12, 2023. �������ý will continue to monitor action on this issue and report on developments.

Congress to Avert Shutdown with Appropriations Package

On Thursday morning, Congressional leaders unveiled text of an appropriations package covering the remainder of the federal agencies and departments whose funding runs out on Friday. The package would fund the Departments of Defense, State, �������ýland Security, Treasury, Labor and Health and Human Services through the end of the fiscal year—September 30, 2024. A brief government shut down is still possible over the weekend, but the measure will be enacted and the threat of more government funding lapses will be off the table, at least for the foreseeable future.