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    A Day on the Hill

    I spent last week in Washington, D.C., doing my best to educate lawmakers, federal government officials, industry groups, think tanks, and charitable organizations about the good work that fraternals do in communities across the U.S.  But I didn’t go alone.  I was armed with brochures and fact sheets detailing the economic impact of our contributions; the anecdotes that you provided, through the new fraternal survey, highlighting the difference we make in the lives of members and the countless people we assist on a daily basis; and ably assisted by one or more of the professionals from our federal advocacy firm, McBee Strategic Consulting.

    I met with legislative staff – primarily tax counsel – for Rep. Kent Conrad (D-ND); Senator Charles Schumer (D-NY); Senator Jon Kyl (R-AZ); Rep. Richard Neal (D-MA); and Sen. Max Baucus (D-MT).  These lawmakers and the committees on which they serve will play a crucial role in the debate over changes to the tax code in 2011.  I also met with the new CEO of the National Association of Insurance and Financial Advisors, the leadership of the National Military Family Association, the director of the financial services center of the Heartland Institute, and Joshua DuBois, director of the White House Office of Faith-Based and Neighborhood Partnerships.

    Here is a quick summary of the “takeaways” from my meetings with congressional staff:

    • NFCA’s “Fraternals Serve” brochure really works. It explains who we are and what we do with compelling pictures and concise copy. And the individual state inserts bring home the message that we are making these contributions in lawmakers’ own backyards. The brochure does a great job of setting the table for conversations with public policymakers because it communicates a clear message that “fraternals do good work.” These brochures are available in large quantities to members who are using them in a variety of ways to describe the impact they and the system are having in their states. To request “Fraternals Serve” brochures, e-mail our office at nfca@nfcanet.org
       
    • Lawmakers are concerned about retirement security for baby boomers. I heard this theme from congressional staff on both sides of the aisle. With concern about reduced Social Security benefits and the increasingly long lifespan of Americans, public policymakers are concerned that people will outlive their assets. Fraternals’ efforts to enhance their members’ financial literacy and help them build a secure retirement through the correct life insurance and annuity products is a key point we want to communicate to members of Congress. By better protecting our members, we are better protecting our nation. This message, combined with our community service activities, creates a powerful “one-two punch” that demonstrates that value and validity of the financial and fraternal components of our societies.
    • Tax issues – including a review of organizations with exemptions and special treatment – are going to be front and center in 2011. Health care reform has passed. Financial services reform has passed. Intensifying political pressure to reduce deficits is likely to result in increased taxes and reduced spending. And it’s anyone’s guess how the results of the November election will impact this debate. The bottom line is that we must be prepared to defend our exempt status in 2011. That means getting more fraternal executives to Capitol Hill to meet with legislators (Stu Buchanan of the Catholic Order of Foresters is making the rounds this week), getting more lawmakers to community service events in their districts (showing folks what we do is always more effective that telling them), and getting your rank-and-file membership educated on the issue and ready to write letters to lawmakers at a moment’s notice.
    • Grassroots communications impacts public policy. There wasn’t a staff member I met with that didn’t take note of the fact that there are nine million members of fraternal benefit societies in the U.S. Several asked if those members would write letters to elected officials if the tax exemption were threatened. Of course, I said that they would – in droves. But the threat of “hearing from folks back home” won’t be enough to ensure the preservation of our exemption. If we can’t back it up with solid statistics and persuasive anecdotes, we’ll be like the boy the cried wolf.
    • The economic equation rings bells. After communicating our overarching message that “fraternals do good work,” I tried to quantify the value of our efforts to the American public – over $400 million per year in direct financial contributions; nearly $2 billion per year in volunteer service – and contrast that to new revenue that would be raised by taxing fraternals ($50 million per year, according to the most recent report by the Joint Committee on Taxation). More than one staff member asked, “Did you say $50 million – with an “M”? Given the huge gap between government revenue and expenses, $50 million in new taxes is less than a drop in the bucket. There are other, larger fish to fry – fish that won’t generate millions of letters in opposition from folks in the district.
    • None of this should be interpreted as saying that we have a free pass that will get us out of the coming debate on tax reform – as I said before, every exemption is likely to be on the table next year. But is does reinforce my belief that we have a good story to tell and that if we communicate our message in an effective and timely manner (i.e. before we get added to the menu in a tax reform bill) we can take an important step to providing fraternals the opportunity to succeed as both financial services and community services organizations.

    So my question to you is this: What are you doing to prepare your society’s executives, board, lodge leaders, and rank-and-file members for the upcoming tax reform debate?  Post your responses here…

    In my next post, I’ll brief you on the results of my meetings with the other organizations mentioned above, and share a few interesting white papers, reports and studies that I’ve come across recently.  Stay tuned…

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