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From the January 17, 2003 print edition
Small business optimistic on Lingle era
Ben DiPietro

After waiting 40 years for change, small business is understandably optimistic the state's first Republican administration since 1962 will enact widespread changes to improve the business climate.

But many businesspeople realize it may take longer than a year for that to happen, and are willing to wait a little longer for the changes promised by new Gov. Linda Lingle.

Jeff Vrechek, owner of Balloons & Things, wants state government run more efficiently and more as a business, but understands it may take more than a year for Lingle to begin implementing substantive changes.

"The first year is going to be more about assessing where things are, looking for what needs to be righted and then moving to make the change," he said. "It's got to be done thoughtfully, instead of haphazardly, done for effect as opposed for the sake of just doing it."

For the first time in years, local businesses that are part of the National Federation of Independent Business are optimistic about the future, says Bette Tatum, state director of the national small-business advocacy group.

"We asked if they are more optimistic today about the business climate and the future and, for the first time in years, 70 percent said yes," she said. "That is nice. Before, small business said they [legislators] hate us. That's where you get the hope, and when you have hope it really helps people."

Lowering employer costs for health-care insurance is the paramount concern of local NFIB members, Tatum said, but to change that requires approval from the U.S. Congress to amend the 1974 Hawaii law capping employee health insurance contributions at 1.5 percent.

"We need a fairer sharing of health costs," she said. "That law was done 30 years ago; it makes no sense today."

Other issues are eliminating workers' compensation stress claims and removing the loophole that requires limited-liability partnerships to have workers' comp coverage when the partners are the only employees while the law exempts partners in a limited-liability corporation from the same mandate.
"Since an LLP is a partnership under state law, it doesn't make sense to treat it differently than any other partnership," Tatum said.

Other issues for the NFIB are lowering the general excise and personal income tax rates, and initiating liability and insurance reforms. Tatum wants to see some progress this year, but understands change will take some more time.

"You're not going to get everything in the first year," she said. "I don't see a whole lot other than the budget being done, but I hope they leave some time to get down to what is going to help business."
Making sure Hawaii-based companies get their fair share of the hundreds of millions of dollars of military construction projects now up for bid is a prime concern for Christine Camp of Avalon Development and the Chamber of Commerce of Hawaii's small-business coalition.

"How do we make sure local companies participate in that?" Camp asked. "It's a huge amount of money into the economy."

Other issues identified by the chamber include lowering the excise tax and reforming workers' comp rules, said Camp, adding some technology companies will devise ways to help make government operations more efficient.

Gregory Blotsky, owner of Cisco's Cantina, likens the change Lingle is bringing to government to building a skyscraper.

"You don't start at the top floor; you start at the bottom and you start building and you can see things going up, you can see things coming along," he said. "That's what I think we'll see here … but it's not going to happen that quickly. It will take time."

Reach Ben DiPietro at 955-8039 or bdipietro@bizjournals.com

Pacific Business News (Honolulu) - January 20, 2003


© 2003 American City Business Journals Inc.






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