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Small Business: A Political Conversation

Jan 01, 2017 08:30AM ● Published by Jason Huddle

Small Business: A Political Conversation

Cabarrus Magazine realizes the impact a new political administration has on the local economy, both from the standpoint of those who lead Cabarrus County in expanding the business landscape and from those who own businesses themselves. 

According to the Small Business Administration, there are 28 million small businesses in the U.S. and they’re responsible for 54 percent of all sales in this country. They provide 55 percent of all jobs and occupy between 30 and 50 percent of all commercial space.

Sage, a business finance and accounting firm with North American headquarters in Atlanta, recently conducted a survey of 500 owners of small to medium-sized businesses. It concluded that 62 percent “feel confident about their businesses’ prospects” over the next six months; 38 percent “believe the results of the U.S. election will have a negative impact on their business;” and 51 percent “believe a Trump administration will have a positive impact.”

All are anxious to see what regulations will remain in place after the Obama era, and what changes will positively or adversely affect them. So, locally, we went directly to the source and asked a group of professionals what they see ahead in 2017.

Robert J. Carney Jr. is executive director of Cabarrus County Economic Development Corporation, the county’s lead economic development agency. Carney is responsible for growing existing business and industry, recruiting new business, product and site development, and collaborating with local, regional and state partners.

Q: In your opinion, will the recent elections bring in new – or expand existing – businesses in Cabarrus County? Why?

“At the local level, my answer would have to be an overwhelming yes. I believe that, countywide, we have a collective leadership that has made economic development a priority. I’ve witnessed a collective focus to grow jobs and investment in a healthy and positive way. Together, our elected leadership is providing the vision and direction our corporation requires to operate at a high level.

“I would say, in my humble opinion, it’s too early to know at the national level. The markets have responded positively to the new president-elect in many ways and that’s promising. The president-elect has stated growing the nation’s economy and improving critical infrastructure is his highest priority. Also, his statements recently have indicated his desire to make the U.S. more attractive/competitive through tax policies and regulation. We’ve also seen his direct involvement in the economic development process.

“What’s difficult to determine at this time is not only the support he’ll receive from House and Senate, but also how these actions will affect the U.S. on a global stage. All action has foreseen and unforeseen consequences, and although we are beginning to get an idea of his intentions, it’s very difficult to translate how those intentions will affect us at a national, state and local level.”

Q: Is there anything the EDC wants to do differently in 2017 with regard to attracting business?

“Our program of work operates on a fiscal year basis, June 2016- July 2017. Some new initiatives include:

• We are tentatively planning an Economic Development Summit for the first quarter of 2017. This meeting will be to discuss concepts/strategies of economic development and will challenge our leadership to continue defining what success looks like for each community.

• Our organization plans to move toward a more metric-based strategy: focusing our corporation’s energy in the areas that provide the greatest return on investment.

 • We also plan to conduct work regarding resetting the opportunity narrative for Cabarrus County. I believe that we have assets (opportunities) that very few communities share. We have competitive advantages in advanced manufacturing and high-density office development that set us apart from most. I think we need to continue to share that story with the private sector on a global scale.”

Barbi Jones is executive director of Cabarrus Regional Chamber of Commerce. The chamber’s function is to further the interests of businesses and serve as a business network and liaison.

Q: With the talk of revoking or revamping Obamacare and restructuring corporate taxes, do you think such changes will affect the local business climate? In what way?

 “Anytime changes are made that affect businesses’ budgets and bottom lines, it’s incredibly difficult on them. Most businesses are thoughtful and plan well, but when they don’t know what might happen and you throw in a lot of unknown variables, it’s really hard. If only we had a crystal ball to know what’s coming!

 “The Cabarrus Regional Chamber of Commerce advocates on behalf of our business community with our local, state and federal officials around education/workforce development, economic development, energy and the environment, transportation, and health care – all important areas that affect our quality of life and businesses’ wellbeing. We’ll continue to monitor the ever-changing situations, represent our members’ best interests and let them know as soon as changes occur.

 Q: Is there anything the Chamber wants to do differently in 2017?

“When I joined the Chamber in April, we sent out a survey to our members asking them what they wanted most from their membership. Educational resources and networking were the top requests.

“To help meet those needs, we’re offering monthly marketing seminars throughout 2017 that help with social media, blogging, networking and telling your story, among others. Also, we have partnered with The Employers Association to offer topical human resources programs to meet changing business needs, and will continue to do so.

 “We will continue to offer our unsurpassed networking opportunities, including a new quarterly after-hours program – What’s Up, Cab Co? – that will feature updates from the Chamber, EDC, our municipalities and a top speaker from our business community. This will replace Good Morning, Cabarrus that we’re discontinuing due to declining attendance. We’ll also anniversary our signature events: Annual Meeting, Cabarrus Chamber Golf Classic, Brew-N-‘Cue, Women in Business, New Teachers Welcome Lunch and First Responders Appreciation Lunch.”

DecisionPathHR is a staffing recruitment and placing firm founded in 2012. Owners Tom Gibson, Robin Gibson and Tanya Bennett share more than 70 years of combined experience. Tom Gibson serves as president and CEO; Robin Gibson is vice-president of operations; and Tanya Bennett is

chief operating officer.

Q: What kind of effect – good or bad – do you think the recent presidential election will have on small business in Cabarrus County? Please consider Obamacare, corporate taxes, unemployment, transitioning from Democrat to Republican in the White House, etc.

TOM: “I think, overall, we’ve had so many regulations established by executive orders coming down from the current administration that the three owners of the company here have spent more time meeting with our local officials, spending thousands of dollars on attorneys and seminars, and having meeting after meeting to assure that we’re complying with the new regulations.

“We’re only four years old, so we opened up in a bad economy and then it seemed like regulation after regulation was coming from the government. We felt like we spend just as much time complying than we do spending time building relations and taking care of clients.

“We had to completely re-engineer our compensation structure. A human resources director was hired and the owners had to come up with a plan to ensure that we followed the new Fair Labor Standards Act (FLSA) regulations. It was an executive action passed through the Department of Labor.”

Lexology.com explains. “The U.S. Department of Labor (DOL) has issued regulations updating the Fair Labor Standards Act (FLSA). Under the new regulations, any employee who is paid less than $47,476 per year will be entitled to overtime pay.

“The law also includes several exemptions under which certain employees are not entitled to overtime pay. Currently, for most exemptions, in addition to meeting a duties test, an employee must be paid on a salary basis at least $455 per week ($23,600 annually). The new regulations more than double that minimum salary to $913 per week ($47,476 annually). The minimum annual compensation for the ‘highly compensated’ exemption has increased from $100,000 to $134,004. These amounts will be adjusted every three years, beginning on January 1, 2020.

“The new regulations also change the salary basis test to allow employers to use nondiscretionary bonuses and incentive payments (including commissions) to satisfy up to 10 percent of the new minimum salary level.”

ROBIN: “It’s a change in overtime laws, but it is really who qualifies for overtime. You were exempt if you made almost $24,000 a year; the Department of Labor nearly doubled that to nearly $47,000. All those employees would either have to be paid hourly or we’d have to nearly double their pay.”

TOM: “Service organizations build incentives to employees. All of a sudden you look at their compensation and when you put them hourly, you’re taking their incentives away from them.

“The U.S. District Court of the Eastern District of Texas stopped the action from happening.”

The Department of Labor says, “On November 22, 2016, U.S. District Court Judge Amos Mazzant granted an Emergency Motion for Preliminary Injunction and thereby enjoined the Department of Labor from implementing and enforcing the Overtime Final Rule on December 1, 2016.

“The case was heard in the United States District Court, Eastern District of Texas. The rule updated the standard salary level and provided a method to keep the salary level current to better effectuate Congress’ intent to exempt bona fide white-collar workers from overtime protections.

“On December 1, 2016, the Department of Justice on behalf of the Department of Labor filed a notice to appeal the preliminary injunction to the U.S. Circuit Court of Appeals for the Fifth Circuit. The Department has moved to expedite the appeal, which was approved by the Court.”

ROBIN: “Our leadership team met four different times to try to keep our employees incentivized. How are we going to re-motivate them when we make them hourly. Just something like that was a huge time waster. With the new administration, we hope the executive orders are taken into consideration.”

TOM: “It’s affecting how people run their business, how they compensate their employees and what the federal government says they have to give them. When we went to a federal structure, they wanted to give people good roads, not dictate how we pay our employees.

“On a state level, taking down the state taxes will make us more competitive in bringing in new business. And then how the governor and the state paid off the $2.5-billion loan to the federal government.”

Governornc.gov says, “Governor Pat McCrory paid off the unemployment insurance debt owed to the federal government. That debt was as high as $2.8 billion and stood at $2.5 billion when Governor McCrory took office in January 2013.”

ROBIN: “Our hope is that a new administration will be less invasive in business and concentrate on the government.”

Zac Moretz is founding partner of Moretz & Skufca law firm. He also specializes in commercial, residential and mixed-use real estate development, and represents homeowners associations across the state.

Q: What kind of effect – good or bad – do you think the recent presidential election will have on small business in Cabarrus County? Please consider Obamacare, corporate taxes, unemployment, transitioning from Democrat to Republican in the White House, etc.

“I anticipate positive results from the election for our business and developer clients in 2017. We are seeing renewed optimism based on Mr. Trump’s initial cabinet appointments and his efforts to retain manufacturing jobs at Carrier and Ford, which were slated to move to Mexico.

“Simply, the prospect of less regulation and a more business-friendly climate is causing optimism, which will lead to more investment and, therefore, more growth and jobs, even if the actual regulatory changes themselves are slow to occur. Reducing Washington’s regulatory wet blanket on the economy will take years, but the sense of optimism that appears to be growing just from the change at the White House and from Mr. Trump’s initial statements and appointments should spur a healthy level of economic growth locally.

“We are also very optimistic regarding his proposed new EPA (Environmental Protection Agency) director, because the EPA’s rules and how it enforces them have become real problems for real estate developers. Like it or not, real estate development is a major employer in our area, and it has been slowed substantially by burdensome federal, state and local regulations, which have vastly increased over the last 10 years. I’m hoping we see some of that dialed back in 2017 and, if so, that will result in new construction that will help our local economy.”

Trey Siner owns and operates Trey W. Siner Insurance and Investment Group. As an insurance and financial advisor, he’s seen the best and worst of economic years.

Q: What kind of effect – good or bad – do you think the recent presidential election will have on small business in Cabarrus County? Please consider Obamacare, corporate taxes, unemployment, transitioning from Democrat to Republican in the White House, etc.

“For the record, I am not a politician, nor do I enjoy all the ‘trash talking’ that goes on in the

presidential races each election year. As for the results of the 2016 presidential election, I am happy that Donald Trump won. I have wanted a businessperson in the White House since Ross Perot ran years ago.

“America is a business at the end of the day, in my opinion. We must manage our resources and stick to a budget! If you or I spend more than we make, we will go bankrupt over time…it really is that simple. He certainly has faults like the rest of us, but the way he makes things happen is very encouraging to me.

 “I truly believe that Trump believes in capitalism, growth and competition, and that is what we need in our country right now. Let’s keep this simple. Lower corporate taxes means more companies will have money to invest in employees and infrastructure. We all hire more people; therefore, more people are working and paying taxes. Brilliant! That is true for smaller companies as well. I know – I am a small business owner.

“United States’ growth depends solely on GDP (Gross Domestic Product) and if people are not working they don’t make money and, therefore, can’t buy anything, which means America does not grow and prosper. This also reduces unemployment, which is a drain on the economy, so now we have another positive for lowering taxes.

 “Obamacare and, frankly, all health insurance is a debacle and it has been for many years. We overpay for higher and higher deductibles and less and less coverage, and in some cases cannot even see the doctor of our choice. The other issue is healthy people pay the same as unhealthy people; why is that? I should be rewarded with lower premiums for being healthy.

“I have seen where people with Obamacare have had 50 percent to 100 percent rate increases each year in the last one to two years! So think about this – your government is making you buy something you may not even want or can afford and charging you a fee if you don’t buy it. I say we must revamp the system. Bringing choice to Americans and opening up competition may be one of the answers to helping lower costs. All I know at this point in time is the system has been broken with Democrats and Republicans in the White House. It is high time to make responsible changes that benefit hardworking Americans and businesses.

“I loved when Trump said to ‘drain the swamp’ in Washington, D.C. There is so much waste and inefficiency in our government that is creates total confusion, chaos and lack of trust. I am hopeful that, by not having a politician in the office, we can reduce overhead, trim spending, get rid of special interests and become a well-oiled machine that actually works for the people of America. The transition from Democrat to Republican has already started and it excites me to see it.

 “I want to make a very clear statement, though. I have built a company from nothing over the last 15 years. When I started we had a Republican in the White House and we had a major blow to our country – 9/11…we all remember that horrific day. I have been successful in building my company during the Democratic presidency as well.

“I do not believe that our elected presidents, nor the parties they represent, will make me successful or a failure. I have total faith in my God, and He has given me the talents and ability to build my business. It is up to me, and what I do each and every day that will make or break me – not the president of the U.S.A.”

Cabarrus Magazine would like to thank those who chose to voice their opinions in this article; we did not know their political party affiliation or what their opinions were before reaching out to them.

There were others who declined and we certainly understand their apprehensions. With so much contention in this country’s air right now, it can be intimidating to say what you honestly feel. Thankfully, the U.S. is still a democracy.

Article by: Kim Cassell

Photos Courtesy: Cabarrus EDC, Zac Moretz, Trey Siner, DecisionPathHR, Cabarrus Regional Chamber of Commerce

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