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RTA NEWS YOU CAN USE
December 15, 2014

TIA's Weekly Legislative Update

AS WE HAVE MENTIONED RECENTLY WE TRY TO POST COPIES OF TIA'S WEEKLY LEGISLATIVE UPDATE WHENEVER WE CAN. WE MAY MISS SOME WEEKS BUT WE WILL KEEP TRYING AND THE REASON WE DO IS BECAUSE THE WEEKLY MESSAGES FROM ROY LITTLEFIELD ARE TIMELY AND VERY MUCH WORTH READING IF YOU WISH TO KEEP ABREAST WITH THE GOINGS ON IN WASHINGTON, ESPECIALLY WHEN THEY ARE TIRE RELATED.

TIA VOWS TO FIGHT RMA PROPOSAL
FOR MANDATORY TIRE REGISTRATION

The Tire Industry Association (TIA) has forcibly announced that they would fight a proposal from the Rubber Manufacturers Association (RMA) to reinstate a mandatory tire registration program. During a panel on tire registration and recalls at the Passenger Vehicle Tire Safety Symposium held by the National Transportation Safety Board (NTSB), the RMA cited low registration rates of tires sold by independent retailers as the reason behind the proposal.

TIA Senior Vice President of Training, Kevin Rohlwing, participated on the same panel and called for a collective effort to educate consumers on the importance of registering tires. Rohlwing pointed to the fact that the National Highway Transportation Safety Administration (NHTSA), RMA and tire manufacturers have made little to no effort to educate consumers as well as the fact that low registration rates are more reflective of consumer apathy than the lack of compliance on the part of independent tire dealers.

"We are incredibly disappointed that RMA supports a legislative solution to the problem of low tire registration rates rather than educational," remarked Roy Littlefield, TIA Executive Vice President. "TIA has been working with RMA on a number of legislative issues like tire repair and used tires over the past few years, but there have been no discussions related to mandatory tire registration. We had talked about working together to educate and improve voluntary numbers, so it was a total shock to hear that they are proposing legislation over education."

Rohlwing's presentation also drew comparisons to NHTSA's system for registering child restraints where the retailer does not play any role nor bear any responsibilities with regards to the process. He questioned why tire retailers are treated differently and manufacturers are allowed to shift the burden onto the back of small businesses. Rohlwing cautioned the NTSB to consider all of the factors related to the low rate of tire registration before making any recommendations to NHTSA.

Tire retailers must still comply with current tire registration laws that require them to provide the customer with the Tire Identification Number (TIN) on a card so the consumer can register their tires. And while RMA's proposal for mandatory tire registration is simply a recommendation, TIA will be stepping up efforts to promote voluntary registration and educate consumers on the importance of registering their tires. TIA is currently working on a "Tire Safety Starts with Registration" video, to be released in early 2015, as the next addition to its consumer education video series. TIA will follow up and submit additional comments to the docket regarding the attempt by the tire manufacturers to place the burden for tire registration on retailers.

"It's important for the industry to recognize that while the RMA's solution to the tire registration problem is to legislate rather than educate, they took the reverse approach when commenting on tire service life," said Rohlwing. "During the panel on tire aging, RMA repeatedly defended their 'educate not legislate' approach citing the lack of scientific data that proves legislation is necessary. Interestingly enough, there is a similar lack of data regarding the number of retailers who supply the registration cards in accordance with the law and the percentage of consumers who follow thru with the registration process."
 
TIA will continue to monitor the situation and maintain an ongoing dialogue with NTSB to make sure that the voices of independent tire dealers are heard on this issue. The Association also wants to remind retailers that Congressional action will be required to overturn voluntary registration in favor of mandatory registration. This fight is far from over and TIA will utilize all resources and expertise to ensure that the voluntary tire registration program remains in place.

TIA is hosting a Federal Lobby Day on February 5, 2015 to meet with representatives on Capitol Hill to discuss the Highway Bill. The issue of tire registration will now be added to the agenda. For more information on this effort, please contact Roy Littlefield IV, TIA Government Affairs Manager, at rlittlefield2@tireindustry.org.

THE BATTLE GOES ON...RSVP FOR LOBBY DAY!
 
In 2015, Congress will need to act on a highway bill. The Highway Trust Fund will run out of money by the end of May, 2015. This could potentially have a huge impact on the tire industry!
 
A variety of options have been proposed including, increasing the motor fuel tax by $.15-$2.00 per gallon, reinstating the Federal Excise Tax on passenger tires, increasing the Federal Excise Tax on truck tires by 10%, reinstating the Federal Excise Tax by $.05-$.15 per pound on tread rubber used in the retread process, increasing the Federal Excise Tax on trucks and truck parts by 10%, and dozens of others.
 
We were an early supporter of legislation introduced by Congressman John Delany (D-MD) "The Partnership to Build America Act" (H.R. 2084). This act is a bipartisan effort to find new funding for roads, bridges, and transit. The act could essentially solve two problems in one. With companies stashing an estimated $1.45 trillion overseas, this act would allow for a means to fund transportation while bringing money from abroad back into the United States economy.
 
Congressman Delaney will be giving an overview of his proposal at the lunch on lobby day.
 
The more attendees we have, the stronger our message becomes. The next transportation bill could include tax provisions that would affect the tire industry adversely for the next decade. With transportation funding being addressed in the spring of 2015, the timing could not be better to have our voices heard in front of the decision makers in Washington.
 
FREE transportation will be provided on February 5th, as well as a FREE lunch, FREE cocktail reception, and most importantly the PRICELESS opportunity to have your voice heard in the halls of Congress.
We ask that you RSVP for this event as soon as possible so that we can accurately plan for the events that day.
 
To register for the Federal Lobby Day on February 5th, contact us.

TAX EXTENDERS
 TIA has been very active in the effort on Capitol Hill to pass the tax extenders legislation.
 
The Senate moved closer to passing the Tax Extenders on December 13 when Republicans relented and joined Democrats in passing a short-term funding bill to keep the government from shutting down.
 
Senator Sessions removed his hold on the Omnibus, leaving Senators Cruz and Lee the lone filibusterers.
 
Recall that 67 strong GOP conservatives in the House are of the same mind as Senators Cruz and Lee-they wanted to use the Omnibus to deny funds to carry out executive action on immigration, but their leaders refused because they lack the votes to override an inevitable veto.
 
Cruz meets regularly with these strong conservatives-they approvingly refer to him as "Speaker Cruz," so he was on the spot when the Omnibus came to the Senate-he almost had to object to keep faith with others who believe he's right to make this fight.
 
To win permanent WOTC in the tax reform bill Congressman Paul Ryan will write next year, we must win the support of these strong GOP conservatives-they are fighters, and as opponents they could cripple our next year's campaign out of the box.
 
Senators Cruz and Lee withdrew their holds on the Omnibus late Saturday after being allowed a vote on a Cruz point of order that funding the President's executive action on immigration was unconstitutional.
 
The Cruz point of order failed and the final vote of the evening on passage of the Omnibus succeeded, 56-40.
 
No more funding bills and threats of government shutdown till next September, except for homeland security and war.
 
The Senate will reconvene this morning to finish approving appointments and dealing acting on final legislative business, i.e., tax extenders and terrorism insurance.
 
The tax extenders bill, H.R. 5771, can come up anytime Senator Reid and Senator McConnell finish canvassing their colleagues to clear the bill and agree to go into legislative session to pass it.
 
The Majority Leader wants to avoid filing cloture on the Tax Extenders, which will occur if a senator wants an amendment-senators will be sounded on amendments or a clean bill today.
 
This doesn't mean an extenders vote can't happen today-it means the timing is entirely in the hands of the Majority and Minority Leaders.
 
Right now, the floor schedule issued by Senator Reid calls for votes on appointments to offices in the executive branch and judiciary all day Monday and Tuesday. The schedule puts pressure on Republicans to speed up the votes as they did for the Omnibus, and that breakthrough would allow the Senate to move to legislative session and pass H.R. 5771.

PRESIDENT WOULD VETO EXTENDERS BILL
 
In an effort to head off an extenders deal that doesn't contain middle class tax cuts the President wants (Child credit, Earned Income Tax Credit expansion, American Opportunity Credit), the White House Press Secretary made the following statement on November 25:
 
"The President would veto the proposed deal because it would provide permanent tax breaks to well-connected corporations while neglecting working families."
 
Details of the proposed deal are circulating but full text isn't available yet.  The R&D tax credit, capital gains exclusion for small business stock, commuter tax credit, and deduction for charitable donations of food would be made permanent, and wind energy production tax credit would be phased out.
 
Other extenders in the Senate's EXPIRE bill, including WOTC, Empowerment Zones, and Indian Employment Tax Credit, would be extended retroactively for two years.
 
The proposed deal would add an estimated $450 billion to the Federal deficit over ten years.
 
Where do we go from here?
 
First, note Speaker Boehner, Majority Leader Reid, and Minority Leader McConnell haven't delivered their opinion on the deal.  It's a deal crafted by the tax chiefs and it has yet to stand the test of whether the Leaders will get behind it.  For leaders of both parties a big question is, will members vote for a large increase in the deficit?
 
The President's veto threat will likely galvanize the Leaders into stepping in to see if they can come up with a bill the President can sign-there's still time for a scenario where the Leaders come together on a bill.
 
There's another scenario whereby House and Senate pass the current deal or something similar near the end of the session and send it to the President, take it or leave it.  If he doesn't sign it, negotiations could resume in January where they left off-on a new bill, of course.
 
The White House is in action and could possibly have a big voice in revising the tentative deal to avoid a veto.  As a result, we're again bringing forward our case for permanent WOTC which the President supports.  
 
We will reach out to our White House contacts during the week of December 1st to ask them to explore including permanent WOTC in the President's wish list for an extenders bill he can support.

OSHA'S EXPANDED REPORTING
AND RECORDKEEPING REQUIREMENTS
 
In 2015 employers must comply with two changes to OSHA reporting and recordkeeping requirements.
 
New Reporting Rules
 
According to the first change, employers must contact their state OSHA agency:
 
Within eight hours if a work-related accident results in a fatality, and
Within 24 hours if a work-related accident results in the hospitalization of one or more employees, an amputation, or the loss of an eye.
 
This requirement will go into effect as of January 1, 2015 in most states, including North Carolina and Georgia. For employers in South Carolina, the new reporting rule will take effect once it is adopted by the General Assembly and implemented by the South Carolina Department of Labor, Licensing, and Regulation-which may not be until the summer of 2015.
 
Currently, employers have to report only accidents that result in a fatality or in the inpatient hospitalization of three or more employees; amputations do not have to be reported.
 
Under the new rule, a fatality must be reported within eight hours if it occurs immediately or if it occurs within 30 days of when the work-related accident took place. An inpatient hospitalization, amputation, or loss of an eye must be reported within 24 hours if it takes place within 24 hours of the incident. The reporting clock does not begin until the employer learns about the reportable event.
 
OSHA defines an inpatient hospitalization as "a formal admission to the inpatient service of a hospital or clinic for care or treatment." Hospital visits for observation or diagnostic testing are not reportable events.
 
An amputation is defined as the traumatic loss of a limb or other external body part. Amputations include fingertip amputations with or without bone loss.
 
New Recordkeeping Rules
 
Also, effective on January 1 for employers in most states, OSHA has narrowed the list of industries that are partially exempt from its requirement to keep records of occupational injuries and illnesses. As a result, many employers that are currently exempt will soon have to maintain these. The records include the OSHA 300 log, 301 form, and 300A annual summary.
 
 
Some of the industries that will be covered by the recordkeeping rule starting with the new year include:
 
"Automobile dealers"
"Automotive parts, accessories and tire stores"
"Commercial and industrial machinery and equipment rental and leasing"
"Direct selling establishments"
"Performing arts companies"
"Museums, historical sites, and similar institutions"
"Amusement and recreation industries"
"Other personal services"
 
The rule exempting any employer with 10 or fewer employees from the recordkeeping requirement will remain in place.
 
The expansion of these reporting and recordkeeping requirements is expected to lead to more OSHA inspections and citations. So as a new year brings new rules, employers should resolve to become familiar with them and prepare to comply with them.

WHITE HOUSE ROLLS OUT NEW TIRE SAFETY, EFFICIENCY PROGRAM ADVOCATING FOR LOW ROLLING RESISTANCE TIRES
 
On December 9, the White House rolled out a new program aimed at getting U.S. consumers to by tires that will enable cars to get better mileage and take better care of them to cut down on tire-related crashes.
 
The program, will encourage consumers buying replacement tires to choose low rolling resistance tires, which cost more initially than those with more friction but increase fuel economy and save money on gasoline.
 
The National Highway Traffic Safety Administration estimates that if 10 percent of replacement tires sold in the United States each year were upgraded to tires with lower rolling resistance, consumers would save more than $200 million in fuel costs and cut carbon pollution by 690,000 tonnes per year.
 
The program requires a formal rule-making, which the Obama administration wants to finish by 2017.
 
The administration also plans to highlight tire safety during the next month, working with tire manufacturers, retailers and oil and gas companies to explain how tire inflation, balance, alignment and rotation can prevent crashes.
 
TIA will continue to follow the developments of this program while promoting our own tire safety programs.

TAX DUE DATES
 
December 15  
 
Corporations - Deposit the fourth installment of estimated income tax for 2014. A worksheet, Form 1120-W, is available to help you estimate your tax for the year.

 Employers Social Security, Medicare, and withheld income tax - If the monthly deposit rule applies, deposit the tax for payments in November.
 
Employers Nonpayroll withholding - If the monthly deposit rule applies, deposit the tax for payments in November.

ESTATE TAX EFFORTS CONTINUE
 
TIA continues to be involved in the Estate Tax battle and in 2015 we have a chance to make some real progress. It has been almost 10 years since the last Estate Tax vote and this is simply unacceptable. In 2015 there will be a vote and we hope it will make a statement. With the Republicans holding both the House and Senate it is a real possibility that over the next few months an Estate Tax bill could be sent to the President's desk (although him signing it would be a long shot). Moreover, this vote would be symbolic and it would bring the issue back to light with the American public. Republicans in the House are now trying to find a Democratic co-sponsor for the bill. Last time there was an Estate Tax vote, several Democrats voted for the measure. Of those who voted for repeal, there are still 33 of those Democrats in office. Yet, getting them behind the bill today in a political environment that has grown more partisan will continue to be a challenge. It is the goal to have an Estate Tax vote around Tax Day.

ESTATE TAX REPEAL IN RETURN FOR A GAS TAX INCREASE IN NEW JERSEY?
 
In New Jersey the state highway trust fund is broke and the state will need to come up with new revenues in order to keep the program funded. As many states have done, NJ is looking at increasing the gas tax. But Republicans have let it be known that they would not pass such a visible tax without a compromise on other issues such as the Estate Tax. It is believed that legislators could quite possibly be faced with the decision of raising the gas yet, yet eliminating the Estate Tax as part of the trade. Many in the state have been calling for full repeal and such a scenario may allow for just that. TIA will continue to monitor this situation. We ask that our members in NJ share their opinion on this proposal.  

CRUDE PRICE DROP REVIVES HOPES FOR GAS TAX INCREASE
(Bond Buyer, 12/11/14)
 
DALLAS - The steady drop in gasoline prices may make an increase in the federal gasoline tax more politically palatable as the next Congress looks for a way to bolster transportation funding, industry experts and politicians said on Thursday at a forum on infrastructure finance.
 
The 40% drop in the price of crude oil over the past few months and a resulting $1.00-plus decrease in the price of a gallon of gasoline provide an opportunity to look very closely at increasing the federal gasoline tax, which is currently 18.4 cents per gallon, said panelist Doug Peterson, CEO of McGraw-Hill Financial.
 
"There is a huge oversupply of crude oil in the market driving down the price and I think that is going to continue," Peterson said at the forum, which was sponsored by the Bipartisan Policy Center. "We could take 3 or 6 or 12 cents out of that $1.00 decrease and still give the taxpayers 95 to 88 cents of savings."
 
Sen. Patrick Leahy, D-Vt., who was in the audience, said he and other lawmakers intend to find some way to correlate the drop in crude oil prices to a higher gasoline tax.
 
"We're going to try something exciting," Leahy said. "I hope we can make it happen."
 
The price of oil should stabilize at about $60 a barrel, down from more than $100 a barrel earlier this year, Leahy said.
 
"American oil producers can survive with $60 oil," he said. "It's the market speculators who will lose money at $60 per barrel, not the oil companies."
 
The gasoline tax is the best way currently available to fund federal transportation spending, said Leahy.
 
Significant revisions are needed to the current system of federal transportation funding because the gasoline tax can no longer generate enough revenue, said Doug Holtz-Eakin, president of the American Action Forum.
 
"The funding mechanism is broken," he said, recommending transportation funding come from general revenues and be subject to the congressional appropriations process.
 
Janet Kavinoky, executive director for transportation and infrastructure at the U.S. Chamber of Commerce, said the gasoline tax remains the simplest and most effective source for federal transportation funding.
 
Using revenues generated through corporate tax reform for transportation would violate the principle of "user pays" that the gasoline tax provides, she said.
 
"Just because everyone says there is no political will to raise the gasoline tax, that doesn't mean the Highway Trust Fund is broken," Kavinoky said. "I'm not ready to give up on it as dead."
 
A vehicle-mile-traveled fee system may be an answer to the transportation funding puzzle but a nationwide program is at least 10 years away, Kavinoky said.
 
"There's a $100 billion hole in the Highway Trust Fund over the next six years and no technically viable solution," she said.
 
Former Los Angeles Mayor Antonio Villaraigosa was skeptical that the Republican-controlled Congress would raise the gasoline tax in 2015.
 
"I see no prospect for that in the short-term or even the mid-term," he said. "There is no political will in either party for that."
 
There should be more flexibility in the use of federal dollars for local transportation projects, Villaraigosa said.
 
"The federal government isn't doing what it should be doing," he said. "It should be providing incentives for states and local governments to get projects done, whether it is public-private partnerships or innovative financing that allows us to put the money to work right now.

TIA's Legislative Update is written by: Roy Littlefield, TIA Executive Vice President

Telephone Contact:  301.430.7280 ext. 108
rlittlefield@tireindustry.org