Influencing Legislation That Could Impact Our Businesses
With the economy still on the mend, it appears many state and local governments dealing with budget issues are looking for quick fixes, and these fixes usually end up affecting small businesses like ours one way or another. Whether it’s a tax on sugary drinks, a ban on plastic bags, or new menu labeling requirements, these measures will most certainly impact our stores and our customers.
Over the last several years the National Coalition has ramped up its efforts to educate franchisees about legislation that could affect us, and to organize storeowners to action. If there’s one thing we know it’s that as a group, franchisees can make a difference. This was clearly demonstrated in 2009, when franchisees teamed with SEI for a signature collection campaign to call on Congress to reform unfair and excessive credit card interchange fees. At the time, the company’s “Stop Unfair Credit Card Fees” petition drive was the largest for a public-policy issue. In September of that year, a contingent of franchisees joined Joe DePinto and other SEI executives in Washington, D.C. to deliver 130 boxes full of the signed petitions to members of Congress. This effort helped pave the way for the Durbin Amendment of the Dodd-Frank Wall Street Reform Act of 2010, which called for the Federal Reserve to set reasonable debit card transaction fees.
More recently, we were also highly involved with the national issue regarding establishments with roll-your-own cigarette machines, the big-soda ban in New York City, and the Illinois online Lottery sales issue. The National Coalition has been using its public relations firm, Russell Public Communications, to keep track of legislative issues at the national and local levels and to assist FOAs in organizing opposition or support for certain proposed bills or ordinances. The National Coalition and Russell Public have also been lending support to the California 7-Eleven Franchisees Political Action Committee (PAC) in their efforts to reach out to local politicians and effect policy.
The biggest issues we are presently monitoring and getting involved with on the national level are swipe fee reform, the anti-trust litigation against Visa and MasterCard, online lottery sales, and the menu labeling requirements that are part of the Affordable Care Act.
With swipe fee reform, although we had a big win with the Durbin Amendment, the Federal Reserve wound up setting new debit card interchange fees that overwhelmingly favor the banks. As a result, there is now a lawsuit in federal court to get the Fed to adjust the swipe fees to a rate that is fairer to retailers. NACS and several other associations are spearheading the lawsuit, and the National Coalition is standing behind them in this endeavor.
We are also keeping a close eye on the $7.25 billion antitrust settlement with Visa, MasterCard and some of the nation’s biggest banks that was the consequence of a lawsuit filed by six merchant groups and 13 big retailers in 2005. The settlement was offered over the summer, and since then it has been rejected by four of the individual companies and all six of the trade associations. Thousands of retailers—7-Eleven included—will be affected by this case because rather than reform the anticompetitive practices engaged in by the credit card industry, it will allow the credit card companies and banks to continue to take advantage of merchants and their customers while blocking competition and choice.
Many states are presently considering online sales of lottery tickets. Illinois was the first to implement it and the National Coalition started working with the Chicagoland FOA as soon as state lottery officials announced their plans to make sure franchisees’ concerns were addressed by the Lottery Commission. These concerns are the loss of foot traffic and sales, fewer winners coming to stores to cash their winnings and make other purchases, and the potential for fraud and lottery sales to minors. Now that Maryland is moving forward with its own plans for online lottery ticket sales, we will be working with franchisees there get these same concerns addressed.
In regard to menu-labeling, we are joining NACS to push for an amendment to the Affordable Care Act not to be included in its menu-labeling requirements. Besides requiring employers to provide health insurance to their workers, the Affordable Care Act also contains menu-labeling rules that require chain restaurants and similar retail food establishments to post specific nutritional information in menus and menu boards. The Common Sense Nutritional Disclosure Act—which is currently making its way through Congress—would exempt c-stores from this requirement, and we are fully behind it.
On the local level, we are helping California franchisees fight the soda taxes on the November election ballots in El Monte and Richmond. Also in California, we are assisting storeowners in the effort to defeat Proposition 37, a bill that would require any food containing even trace amounts of a genetically engineered ingredient to be labeled as such, and makes storeowners responsible for ensuring that the food products are properly labeled. This bill also includes a “bounty hunter” clause that allows lawyers to sue storeowners for not following the labeling rules. Needless to say, this measure would be very detrimental to California franchisees if it passes.
Our business environment is changing, and in no small part due to an economy that continues to recover. Any time we find out about legislation that could affect our stores, we need to take the time and get involved as a group. I also encourage you to contact your local FOA leadership and the National Coalition if you hear of any legislation that could impact our business. United, we can make a difference.