Business owners say health law buries them in paperwork

McClatchy NewspapersFebruary 10, 2011 

WASHINGTON — A North Carolina business owner and supporter of U.S. Rep. Renee Ellmers testified Wednesday before the House Small Business Committee at her invitation, saying the health care overhaul that passed last year threatens small companies such as his.

Jerol Kivett owns Kivett's Inc., a company that makes church pews, courtroom millwork and other furniture in Clinton, a small Sampson County town about 60 miles south of Raleigh.

Kivett and his wife, Telia, were among the hosts of Ellmers' swearing-in reception Jan. 5 at the Hay-Adams Hotel in Washington. According to the Open Secrets campaign-tracking database at the Center for Responsive Politics, Telia Kivett donated $2,000 to Ellmers' campaign in the last election cycle.

Jerol Kivett testified Wednesday against a measure in the health reform law that requires companies to file paperwork known as a 1099 form every time they spend more than $600 on a vendor. The form, sent to the Internal Revenue Service, is intended to keep track of transactions for tax purposes and build revenue to pay for health reform.

But small businesses around the country have loudly opposed the provision, saying the paperwork is onerous and costly. There is a bipartisan effort, also supported by President Barack Obama, to repeal the 1099 requirement.

Ellmers, a Dunn Republican, also supports repealing the 1099 requirement.

"Working through a recession is tough, but adding to the burden with cumbersome and confusing new laws and regulations makes a recovery twice as hard," Kivett said in his testimony.

He testified on behalf of the National Federation of Independent Business. Also testifying were a restaurant owner, a jeweler and a homebuilder. All four men said the 1099 provision and the whole health care overhaul threaten small businesses.

Kivett said that with the expanded requirements, he would have to go from filing an average 25 Form 1099s per year to an average 300 forms per year.

It is common for members of Congress to invite constituents to testify on panels to show the real-life impact of federal policy, and Ellmers introduced Kivett to the panel Wednesday as a friend.

Kivett told Ellmers and other House members that the health care law "is the biggest burden on small business today."

He said the recovery has been tough, and told the panel he expects to cut staff in the coming year.

"We've been chipping away at money we had set aside for expansion and equipment," Kivett said. "I cut my salary in half three years ago. It's very difficult."

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