Debit Card Swipe Fee Rule to Come Next Week
Reports circulated yesterday that the Federal Reserve would unveil a proposed rule next week that would limit swipe fees on debit cards- the transaction fees that banks can charge retailers when a customer uses a debit card.

The debit rulemaking was authorized as part of the Wall Street Reform and Consumer Financial Protection Act and was supported by over 200 national and local trade associations including NACS. The provision was also supported by national consumer groups and more than 5 million individual consumers who signed petitions supporting swipe fee reform.

The Act simply requires that the Federal Reserve write standards to ensure that debit card swipe fees charged by the megabanks – those in excess of $10 billion in assets – be “reasonable and proportional” to the actual cost to process a transaction. The Federal Reserve has prohibited just these types of fees on check transactions for decades. Now that most of these transactions happen electronically through the use of debit cards (which is cheaper for the banks to handle than checks), it is time for the Federal Reserve to take similar actions here.

For too long swipe fees have not been set by a free market but instead by collusion and price fixing by the card networks and megabanks, which have masked from consumers the true cost of credit and debit products. The swipe fee provisions signed into law are intended to realign incentives so that consumers can make informed decisions while enhancing competition in the retail industry.

NACS Staff Contact: Lyle Beckwith, lbeckwith@nacsonline.com

Mini Med Health Care Plans Receive More Scrutiny
The Department of Health and Human Services (HHS) today released new guidance that will give consumers more information about their health insurance plan. Under the new rules, health insurers offering “mini-med” plans must notify consumers in plain language that their plan offers extremely limited benefits and direct them to HealthCare.gov where they can get more information about other coverage options. HHS has also issued guidance restricting the sale of new mini-med plans except under very limited circumstances.

The Affordable Care Act will end limited-benefit health insurance plans, sometimes called “mini-med” plans, in 2014. Many part time and hourly workers have these types of plans. In order to protect coverage for these workers, HHS has issued temporary waivers from rules restricting the level of annual limits to some group health plans and health insurance issuers. Waivers only last for one year and are only available if the plan certifies that a waiver is necessary to prevent either a large increase in premiums or a significant decrease in access to coverage.

Guidance issued yesterday ensures that consumers in plans with low annual limits are notified of the exact components of their health plan so that they can make informed decisions about whether mini-med coverage is right for them. The supplemental guidance requires health plans with waivers to tell consumers if their health care coverage is subject to an annual dollar limit lower than what is required under the law. Specifically, the notice must include the dollar amount of the annual limit along with a description of the plan benefits to which the limit applies. 

Additional guidance issued also provides new rules on when mini-med plans can continue to be sold. Under limited circumstances, insurers that have obtained a waiver of the annual limit requirement can sell policies to new employers and individuals.

More information about the new guidance can be found here and the the guidance can be found here.

NACS Staff Contact: Julie Fields, jfields@nacsonline.com

House Committee Chairs Announced
With the Republican takeover of the House of Representatives this election cycle a new slate of Representatives will be heading up the Committees. Most of these members served as Ranking Members while they were in the minority but some are new appointments.

NACS Staff Contact: Julie Fields, jfields@nacsonline.com

Dems Tell White House to Work on Tax Extenders Package
The House Democratic Caucus rejected the White House-backed tax cut deal in a non-binding vote yesterday. House Speaker Nancy Pelosi (D-CA) stated “we will continue discussions with the President and our Democratic and Republican colleagues in the days ahead to improve the proposal before it comes to the House floor for a vote.” Among other things, the tax packaged includes:

• Extending the 2001 and 2003 Income Tax Rates for two years for all income levels
• A tax cut equal to 2 percent of FICA wages for all wage and salary workers in 2011
• Extending the estate tax with a $5 million exemption taxed at 35% thereafter
• Extending the biodiesel and ethanol subsidies through 2011

There is a great possibility that some of these extensions might be tweaked as negotiations are currently taking place in order to garner the sufficient votes to move this package through the House and Senate.

We are watching the Senate very closely through this process as Senate Majority Leader Harry Reid (D-NV) has signaled that he might attach an online gambling bill to this tax package to appease his friends back home. NACS is vigorously opposing the online gaming bill as it legalizes the online sales of lottery tickets. Senate Republicans have vowed to prevent Reid from attaching this legislation.

NACS Staff Contact: Corey Fitze, cfitze@nacsonline.com

Ozone Control Decision Delayed
This week, the Environmental Protection Agency (EPA) announced it was delaying until July a decision to reduce the permissible levels of ozone emissions into the air. The announcement provides retailers with additional time to secure a regulatory decision that will render expensive Stage II vapor recovery obsolete.

The Clean Air Act requires re-evaluation of the ozone standards every 5 years. The Bush EPA had revised the limit for ozone attainment to a lower level, prompting an increase in non-attainment counties. Under the Bush standard, 322 of the 675 monitored counties are considered in non-attainment.

The new EPA disagrees with the standards set by the previous administration and has proposed to revise the standards to a more stringent level. Under the Obama proposal, potentially 650 of the 675 counties would be considered in non-attainment.  It is unclear yet how many of these counties would be classified with the most severe non-attainment designations, which trigger mandatory implementation of Stage II vapor control systems at petroleum outlets.

The Clean Air Act provides that requirements for Stage II vapor recovery at retail facilities would be removed once the number of vehicles equipped with on-board vapor recovery (ORVR) devices reaches “widespread use.” EPA has yet to finalize its determination of “widespread use” and, hence, Stage II continues to be required in many markets where it otherwise would be considered obsolete. With the new ozone standards coming down, the importance of finalizing “widespread use” and retiring Stage II takes on greater urgency.

The delay in EPA’s decision provides additional time to secure a definition of ORVR widespread use and sunset the requirements for Stage II before new ozone standards impose unsustainable costs on thousands of retailers.

NACS Staff Contact: John Eichberger, jeichberger@nacsonline.com