Small Business Weekly: Officials knew health care site would be delayed back in August


When did the Obama administration know the small-business health insurance site would not be ready on schedule? No later than Aug. 13, it seems. (Andrew Harrer/Bloomberg)

A review of some of the biggest small business and start-up stories from the past week, with a focus on Washington.

Officials knew of SHOP delay in August

Obama administration officials knew the online small business insurance marketplace mandated by the health care law would not be ready on time long six weeks before they announced the delay, according to e-mails released Friday.

An email sent to officials on Aug. 13 from HealthCare.gov’s main contractor, CGI Federal, indicates that the rollout was scheduled to be pushed back to November 15, six weeks later than the planned start on Oct. 1. It was not until September 26, just four days before the site was slated to open, that officials announced the launch would be pushed to November.

House votes to ease private equity rules

The House of Representatives last week approved legislation that would exempt most private equity firms from registering with federal regulators, a move meant to ease the flow of capital to new and growing businesses.

Currently, most financial advisory firms that manage more than $150 million are required to register with and file regular reports to the Securities and Exchange Commission. The bill approved Wednesday would exempt from many of those requirements any private equity firm with an outstanding investment balance no more than double its capital investment commitments.

Small-business hiring hard to read

The National Federation of Independent Business reports that small businesses added only 0.05 workers per firm in November, half the pace at which they were hiring in October and little changed from an average loss of 0.04 worker during the same month last year. Only one in seven small firms added workers during the month, while one in eight cut back on their payroll, according to the poll.

Meanwhile, a second jobs report by payroll company ADP showed that firms with fewer than 50 workers added 102,000 jobs in November, nearly triple the pace of October, when they added 37,000, and five times the gains posted during the same month last year (19,000). It was the largest jobs gain for the sector since January.

New tax proposal a mixed bag for small firms

Senate Finance Committee Chairman Max Baucus (D-Mont.) recently started rolling out a broad tax reform proposal, which would lower the corporate tax rate, simplify accounting rules, and double the amount of equipment and property investments business owners can deduct from their tax bill — a helpful change for small business owners planning to expand or retool in the coming years.

However, the legislation would also slow the rate at which firms could write off certain other investments going forward, potentially giving an advantage to existing firms who made investments in years past over start-ups trying to get off the ground. Baucus’s plan would also take an axe to longstanding tax deductions for advertising investments as well as tax breaks for research-and-development expenses.

What are you keeping an eye on this week? Please let us know below.

Follow J.D. Harrison and On Small Business on Twitter.

J.D. Harrison covers startups, small business and entrepreneurship, with a focus on public policy, and he runs the On Small Business blog.

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