OCTOBER 8, 2019 has significant meaning for me for two reasons. First, and most importantly to me, it marks the 25th year I’ve had the good fortune to be married to my wife, Kelleen. She has been a great source of inspiration, pride and support over those years and it’s hard to believe that much time has passed. Second, it will have been six months since I joined the staff of the National Club Association—and for this I also feel fortunate. I want to take a moment to thank all the NCA members and staff who have given their time and support to me in making the transition a smooth one and I’m looking forward to the years ahead.
I wish I could say that things were as inspirational, supportive and smooth in Congress. Investigations, litigation over the investigations, accusations of all types and political gamesmanship seem to be reaching a crescendo—and we haven’t really even begun the real Presidential campaign season yet! At times it feels we need to summon the optimism of the child sifting through a pile of manure, certain that a pony has to be in there somewhere. All that said, there have been some good moments and we could see a few more bright spots before the end of the year.
Before Congress broke for their traditional August recess period, the House, Senate and the president reached an agreement on spending caps for the next two years that lifted the debt ceiling through July 2021. While there may be disagreements among those on the left about not enough spending and those on the right believing there was too much spending, the agreement passed and was signed into law. This sets the stage for the work Congress will do for the remainder of the year and clears pathways for other important legislation to be considered.
Pending Legislation
One piece of legislation NCA is pushing to have considered by the end of the year is the “Personal Health Investment Today (PHIT) Act,” which would allow individuals and couples to use up to $1,000 a year ($2,000 for a couple) from their health savings account to pay for fitness activities and equipment. This could be for themselves or their children and would cover things like organized sports activities, instruction, tournament and practice fees. It also allows individuals to purchase apparel and equipment, up to a $250 limit on any item, that is solely for the purpose of the fitness activity. While the legislation specifically excludes membership fees for private clubs, it still allows members of private clubs to use funds outlined above. The bill is bipartisan and aims to provide a way for people to invest in their health and fitness to prevent illness instead of limiting spending only after someone gets sick—which is an important shift in the way we approach our health care dollar. NCA is working with the PHIT Coalition to push for it to be passed this year and we are gaining cosponsors and momentum.
In July, the House of Representatives also passed legislation that would increase the federal minimum wage from the current level of $7.25 an hour to $15 an hour by 2025. NCA opposed this legislation because of the impact it would have on clubs around the country and the upward pressure it would cause on wages well above the minimum. The typical club uses about 45 percent of their annual budget for hourly wages and an increase of that size over that short of a time span means most clubs would have to raise their dues significantly each year for five to seven years in order to meet the increases in labor costs alone. It’s been 10 years since the federal minimum wage has been increased and most people would agree we’re due for an increase. In fact, since 1939 the federal minimum wage has been increased 70 times at an average interval of just under 3 years between increases. The longest periods between increases going into effect is 10 years, which happened twice, from 1997 to 2007 and 2009 to 2019. The Senate is very unlikely to take up the House-passed legislation, but it would behoove all clubs to start planning for an increase in the minimum wage soon, because we’re reaching the outer limits of historical intervals between increases going into effect.
NCA’s Policy Agenda
NCA’s Government Relations Committee held a conference call in July and among the many topics we discussed were changes we’re implementing to our government relations program. Our plan is to be more inclusive in building relationships on both sides of the aisle, which you will see reflected in this issue of Club Director. We’ve also embarked on developing a policy agenda that is member-driven and clearly articulates the issues private clubs are concerned about: Taxes, labor, health care, environment and immigration. We hope to bring that document to the board of directors for approval later this year. This policy agenda will lay out the issues in broad terms to provide members with a better understanding of what NCA is working on and allows the association to have guideposts by which to evaluate the support or opposition to legislation and regulation in Washington and in the states. I hope you agree this will be a useful tool for us to better represent the community of private clubs and I encourage you to reach out to me anytime to share your thoughts on regulations and legislation being considered in Washington.
Joe Trauger is NCA’s vice president of government relations. He can be reached at 202-822-9822 or [email protected].