LEAD STORY
The Never-Ending Fight for Small Business
When Grafton “Cap” Willey, CPA, first heard the following quote, he thought it was witty. He thought it delivered an entirely appropriate message: “Small business – hugged in public, mugged in private.” It is attributed to Milt Stewart, who was the first U.S. Small Business Administration Chief Counsel of Advocacy, appointed by President Jimmy Carter in 1978.
Willey, a managing director in the CBIZ Tofias office in Providence, has long been a friend to Rhode Island’s small business community. He has been an advisor, an advocate – and a fighter. That’s why it bothers him so much that Stewart’s sentiment, three decades old, remains so apropos.
“Milt Stewart recently passed away,” said Willey. “He was a great small business advocate who I had worked with for many years.”
Willey had hopes that the climate for small business would change over all those years, but unfortunately it hasn’t.
“If I had a nickel for every time I’ve been told by a politician that small business is the economic engine that drives the economy, I would not be in small business anymore,” he said.
But Willey continues to fight for the small businesses across Rhode Island, because he knows the challenges many of them are facing on a daily basis. As a local champion for them, in September, he was named the “2011 Lewis Shattuck Small Business Advocate of the Year.” The award is given by the National Small Business Association, which noted that Willey has held various leadership positions in several small business associations and has been elected twice as a delegate and state chair to the White House Conference on Small Business. Cap was also appointed to a three-year term on the Small Business Advisory Council to the Federal Accounting Standards Board and served on numerous state advisory committees to the General Assembly, as well as the governor.
Of late, Willey’s lobbying efforts on behalf of the small business community have been fueled by some important victories, perhaps most notably is the issue of personal income tax, where significant reforms were adopted by the General Assembly.
“Passing the personal income tax reform package was a huge accomplishment,” he said. “The old Rhode Island system left us in a terribly uncompetitive disadvantage when we were compared to other states. Our high marginal tax rate was 9.9 percent, which placed Rhode Island at number two or three in the country. When Massachusetts was at 5.3 percent and Connecticut was at 6.5 percent it was an easy decision for companies to locate in Seekonk or Attleboro and still serve the Rhode Island markets. The savings were significant and we are so small that our borders can easily be avoided.”
Through the tax reform efforts, Willey and others were able to convince legislators to lower the marginal rate down to 5.99 percent. They accomplished it by broadening the base by eliminating itemized deductions in place of a standard deduction. As Willey stated, “This is particularly helpful to small businesses, most of which operate as pass through entities that pay taxes at the individual tax rates.”
Willey’s efforts on behalf of the small business community, and other RISCPA members often found testifying at State House subcommittee hearings, such as Patricia Thompson, CPA, another RISCPA member, is helping to increase RISCPA’s visibility and credibility at the State House. In fact, Willey has seen up close that the RISCPA has earned a level of respect within the state legislature.
“I think the RISCPA over the past few years has established itself as a knowledgeable resource that the legislators can count on to give them an honest answer to the fiscal issues that they are facing. Most other groups are viewed as special interests with an agenda.”
But other battles loom. And opponents of small business – and there are many -- are always ready for the fight.
“Special interest groups invest lots of money to get their points across,” said Willey. “Small business owners don’t have the time because they are running their small businesses.”
Willey will be watching closely in the coming weeks as Gov. Lincoln Chafee, members of the General Assembly, and General Treasurer Gina Raimondo tackle pension reform. Discussions about pension reform have centered on retirees and the crippling weight that their pensions have become for cities and towns across the state. But Willey warns too of the impact that the cost of such pensions has on the business climate.
“I see the potential of infrastructure, social service programs, education, and city and town services being affected dramatically,” said Willey. “This will have a negative impact on the ability of small businesses to operate in Rhode Island.”
Like never before, the small business community needs help -- in public – and in private. Fortunately, Cap Willey will be there to continue fighting for them.
