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The Legislative Report blog provides timely information on federal and state legislation and regulations and state trends as well as the myriad issues affecting the private club industry. A companion to CMAA's Legislative website, this resource should be your first stop for any information regarding legal, tax or legislative club-specific issues.

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House Passes Permanent Tax Incentives for Conservation Easements

(Congress, IRS) Permanent link

02_19_15

On February 12, the House of Representatives passed HR 641 – the Conservation Easement Act of 2015 as part of the America Gives More Act of 2015 (HR 644). Introduced by Representative Mike Kelly (R-PA), HR 641 would alter the 1986 tax code by making the tax incentive for qualified conservation easement permanent. HR 644 also included permanent restorations for other charitable giving incentives including contributions of food inventory.

Conservation easements allow a property owner to deduct the value (a partial interest) that is donated to a qualified charitable organization exclusively for conservation purposes.

In December, Congress acted retroactively to reinstatement multiple tax provisions for tax year 2014, including conservation easements (HR 5771). However, this extension is only applicable to tax year 2014 and expired as of December 31, 2014.

This measure will now move to the Senate for consideration. Stay tuned to the CMAA Watch List for more information!

OSHA Explains Reporting Rule for Amputations and Sight Loss

(OSHA, Regulation) Permanent link

1_26_15OSHA’s new reporting requirements became effective January 1. Now clubs are required to notify OSHA of work-related fatalities within eight hours, and work-related in-patient hospitalizations, amputations or losses of an eye within 24 hours. Previously, employers were not required to notify OSHA of these types of injuries.
 
However, the new regulation lacked clarity for employers on what constitutes an amputation or sight loss. In an interpretation letter, OSHA has sought to provide clarity on this important question.
 
What is Amputation? “An amputation is the traumatic loss of a limb or other external body part. Amputations include a part, such as a limb or appendage, that has been severed, cut off, amputated (either completely or partially); fingertip amputations with or without bone loss; medical amputations resulting from irreparable damage; amputations of body parts that have since been reattached. Amputations do not include avulsions, enucleations, deglovings, scalpings, severed ears, or broken or chipped teeth.”

 
Most interesting, OSHA suggests relying on the diagnosis of a health care professional to determine if the injury fits this definition.
 
What is Sight Loss? “Loss of an eye is the physical removal of the eye, including enucleation and evisceration. Loss of sight without the removal of the eye is not reportable under the requirements of section 1904.39. A case involving loss of sight that results in the in-patient hospitalization of the worker within 24 hours of the work-related incident is reportable.”

 
Further, “The reportability of the loss of an eye is not determined by the type of medical care received to treat the injury. The physical removal of the eye from the socket as a result of a work-related event is a reportable event.”
 
For more information, please visit OSHA’s website on this topic.

Congress Challenges Health Care Reform

(Health Care Reform, Legal Issues) Permanent link

1_20_15_175wWith the change in power in the Senate, a new session of Congress and a group of newly-elected Congressmen, there are multiple new bills that challenge the Affordable Care Act (ACA).

Here are two to watch:

HR 30 - Save American Workers Act of 2015 – Introduced by Representative Todd Young (R-IN), this bill would repeal the Affordable Care Act definition of “full-time employment” as 30-hours and restore the traditional 40-hour workweek as it pertains to the minimum essential health care coverage required under the employer mandate. This measure has already passed the House of Representatives by a 252 – 172 vote on January 8, and has been reference to the Senate Finance Committee for further consideration. In addition, ,the Senate Health, Education, Labor and Pensions Committee will hold a hearing on January 22 on this issue as well as to consider the current system of employer provided health care.  

HR 248 - American Job Protection Act
– Introduced on January 9 by Representative Charles W. Boustany, Jr. (R-LA), this measure would repeal the entire employer health insurance mandate from the ACA.  The bill is currently awaiting consideration in the House Committee on Ways and Means.

However, the Presidential veto threat looms on both these measures. It is unlikely the President will sign anything which he deems to weaken the original intentions of the ACA.

Stay tuned to the CMAA Watch List for up-to-date information on these and other measures affecting the club industry!

Don’t Forget to Post Your 300A Illness Injury Summary in February

(OSHA, Regulation) Permanent link

01_19_15OSHA is reminding employers of their responsibility to post the club’s Form 300A from February 1 through April 30, 2015. The OSHA Form 300A summarizes the total number of job-related injuries and illnesses that occurred during the 2014 year. This summary comes from OSHA’s Form 300, the log of work-related injuries and illnesses.
 
The summary should be displayed in a common area where notices to employees are usually posted. Think bulletin board next to the time clock - if you have one.
 
Exemptions to this rule exist for employers with 10 or fewer employees.
 
And, don’t forget, OSHA’s new reporting requirements are now in effect. Review these significant changes before you need to use them!

NLRB Issues Final Ambush Election Rule

(Dept of Labor, Regulation) Permanent link

12_17_14_175On December 12, the National Labor Relations Board (NLRB) published its final ambush election rule which was first proposed in 2011. In February, the NLRB reissued the rule for public comment. The rule is slated to become effective April 14, 2015.

Here is an overview of the changes, as provided by the NLRB. The final rule:

  • Provides for electronic filing and transmission of election petitions and other documents;
  • Ensures that employees, employers and unions receive timely information they need to understand and participate in the representation case process;
  • Eliminates or reduces unnecessary litigation, duplication and delay;
  • Adopts best practices and uniform procedures across regions;
  • Requires that additional contact information (personal telephone numbers and e-mail addresses) be included in voter lists, to the extent that information is available to the employer, in order to enhance a fair and free exchange of ideas by permitting other parties to the election to communicate with voters about the election using modern technology; and
  • Allows parties to consolidate all election-related appeals to the Board into a single appeals process.

The renewed rule will significantly change NLRB election procedures by decreasing the time between the filing of a petition and the occurrence of an election. It could be disadvantageous for both employers and employees by hampering an employees’ ability to obtain complete information about the costs of unionization and limiting the employer’s ability to effectively prepare for the process. An election could be scheduled in as few as 10 days. The current average is 30 days.

Stay tuned as this is an issue which will be contested in 2015!

IRS Targets Nontraditional Activities

(IRS) Permanent link

12_16_14_175In recent months, the Internal Revenue Service (IRS) has begun focusing on nontraditional income for 501 (c)(7) tax-exempt clubs in examinations and Private Letter rulings. In a PLR released on Friday, December 12, the IRS revoked the tax-exempt status of a social club who had incurred significant nontraditional income, apart from its core mission as a social club.   

Mitch Stump, CPA, and author of the Club Tax Book, shares "The issue of non-traditional income has come up recently and repeatedly on IRS examinations. Now, with this recent PLR which uses a 'Modified gross receipts per. Rev. Proc. 71-17' methodology, all 501(c)(7) tax-exempt clubs should be on notice that their non-traditional activities could cost them their tax exempt status."

So what are nontraditional activities? In short, they are any activity that does not meet the club's central purpose which should be organized "exclusively for pleasure, recreation and other nonprofitable purposes." Think to-go food and wine sales, where the consumption by the member is off-site.

Read more on this topic in McGladrey’s eClub New's article “Non-traditional activity in private clubs.

Court Strikes Down Private Wage Surveys for H-2B Visa Program

(Legal Issues, Dept of Labor, Immigration) Permanent link

12.11.14A_175On December 5, the Third Circuit of the US Court of Appeals overruled the use of private wage surveys in the determination of wages for H-2B visa workers. In its decision, the court cited the negative effects of the use of these surveys on both employers and employees.

For employers who cannot afford the cost of commissioning a private survey, they must rely on the Occupational Employment Statistics survey from the Department of Labor's Bureau of Labor Statistics. For employees, both H-2B workers and US workers, the Court argued that the surveys created "depressed" wages and earnings when compared to the wages from DOL’s statistics.

Further, Judge Morton I. Greenberg argued in his decision that the DOL had violated the Administration Procedures Act by failing to "offer any rational justification for this policy as it leads to similarly situated workers in the same market in the same season bringing home widely disparate paychecks."

Due to ongoing litigation involving the DOL and H-2B visa program wages, H-2B visa wages are being calculated based on interim 2013 rules, with most employers obtaining a prevailing wage determination from DOL. Earlier this year, the DOL announced its plans to issue a new notice of proposed rulemaking specific to H-2B wages. These proposed rules were expected this month but have yet to be announced.