Sanity on the Hill for a Change

UPDATE: It's the law now. The President signed it.


Former House Speaker Nancy Pelosi (D-CA) asked us to wait until the bill was passed to see what was in it. We all know that this refers to the Patient Protection and Affordable Care Act (Health Care Reform or PPACA). Most observers would say that the bill (now law) had a number of good things in it. Most observers would also say that it had a number of bad things in it. With regard to some of those elements, however, there was near unanimity. One, in particular, is the requirement that businesses and landlords file a Form 1099 with the IRS for all goods and services purchased with value above $600. Surely, this has something to do with either patient protection or affordable care, but the connection escapes me.

In the House of Representatives, the bill passed by a vote of 314-112. In fact, in addition to Representative Dan Lungren (R-CA) who introduced the bill, there were 273 co-sponsors. That was enough to get it through the House without any of the non-sponsors voting for it. The co-sponsors were from both parties. No Republicans voted against the bill. The Democrats were fairly evenly split with roughly 40% of them supporting passage of the bill.

Yesterday, the Senate acted on the bill, introduced by Senator Mike Johanns (R-NE) and co-sponsored by 10 others representing both major parties. The Senate passed the bill by a vote of 87-12. The Library of Congress website has not yet reported the vote, so I can't report to you who the 12 with particularly lame brains are, but if you find the need to know yourself, check here and click on 'major congressional actions' when that link becomes active.

The bill now goes to the President who I expect will sign it. Now that this is over with, perhaps we can have a budget for Fiscal 2011 before Fiscal 2011 ends.

House Votes to Repeal 1099 Requirement

Yesterday, the House of Representatives voted to repeal the silly 1099 requirement in health care reform (PPACA). For those who have been in hibernation, this provision requires businesses to provide Forms 1099 to report payments for goods and services in excess of $600.

When this language, that is oh so related to health care, was put in PPACA, it was clear that the drafters were looking for a way to make the act revenue positive. Little did they seem to realize or care about the tremendous burden that this would put on businesses, especially small businesses.

Given the public uproar over this provision, one would think that its repeal would fly through the Senate as well for signature by President Obama. However, Democrats in the Senate are reported to be concerned about how this affects the price tag on PPACA.

To me, this is what happens when we load up a bill with things that are entirely unrelated to the bill's intent,or at best, peripherally related to it. Some may recall that the Pension Protection Act (PPA) of 2006 had pages and pages of provisions that were encouraged by lobbyists. Even going back to my earlier days in this business, the Tax Reform Act of 1986 had provisions that applied, for example, to every company whose primary business is in the field of widget-making and which was incorporated in the State of Delaware on some random date in 1923. Every company, huh?

The 1099 provision needs to be repealed. While I usually try to keep this blog apolitical to the extent that I can, this provision neither improves health care, changes the cost of health care, nor stimulates the economy. Companies can react in one of several ways, but I expect that most small businesses will simply see an increase in their cost of outsourcing their reporting, and that can't be good.

In any event, if the Senate does pass this, I am sure that it will make the news, but I will do my best to cover it here.