News From Congresswoman
Nydia M. Velázquez
Representing New York's 12th Congressional District - Brooklyn, Manhattan, Queens
Ranking Democratic Member, House Small Business Committee

For Immediate Release
April 13, 2005

CONTACT: Kate Davis, Allyson Ivins, (202) 225-4038

Republicans Block Attempt to Protect Small Businesses Under Social Security Reform
Democrats pledge to ensure small firms are protected from negative impacts

WASHINGTON – In the first vote during the 109th Congress on Social Security reform, Republicans on the House Small Business Committee refused to support a proposal to make protecting small businesses under Social Security reform a priority.

The debate occurred during a mark-up of H. Res. 22, “Small Business Bill of Rights,” which outlines priorities and non-binding rights for small businesses. Democrats offered several amendments to improve the scope of the bill, and to reflect the needs of the small business community nationwide. Congressman Raúl Grijavla (D – AZ) offered the amendment that would protect small businesses under Social Security reform. It is a concern for small firms because of the additional costs, regulatory burdens and liability they could incur from the President’s personal savings accounts proposal.

“Social Security is particularly critical given that small business owners and their employees rarely have retirement plans,” Congresswoman Nydia Velázquez, Ranking Member said. “We need to make sure that not only will any reform provide them with a secure retirement, but also that small businesses are not unfairly burdened when it comes to administering Social Security.”

While there has been a great deal of discussion on Social Security reform, there has been little on how it will impact small businesses. Democrats believe Social Security reform is of particular relevance to small businesses due to the additional costs, regulatory burdens and liability that would be imposed through personal savings accounts. Republicans argued against the proposed amendment, saying that issues such as tort reform, and the repeal of debt tax, were more important to small firms and that Social Security was not as high of a priority.

“Clearly there is a disconnect between Republicans and the needs of our nation’s small businesses,” Rep. Velázquez said. “Every small business owner in this country not only submits Social Security payroll taxes, but they rely on Social Security; and to imply that protecting them under social security reform is not a top priority is just plain wrong.”

Republicans on the committee rejected the amendment with a vote of 11 to 14. However, Democrats pledged to continue fighting to ensure that small businesses will be protected under social security reform.

“Given the importance of the issue, I cannot believe that this committee would pass a bill giving rights to small businesses that fails to provide the necessary protection from the potential harmful impacts of any Social Security reform,” Congresswoman Velázquez said. “It is a travesty that this amendment would not be included to protect our nation’s 23 million small businesses from being negatively impacted by one of the most significant proposals we will face this Congress.”

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