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REISA Charges Capitol Hill

May 15, 2013


REISA Charges the Hill
 
REISA again took to Capitol Hill to meet with members of Congress and their offices regarding issues important to REISA members. In small teams, those representing REISA visited over 20 offices outlining REISA’s positions on several topics of interest: compensation and taxation issues such as carried interest and entity-level taxation, Dodd-Frank fiduciary standards for broker-dealers, JOBS Act issues and the uncertainty of SEC rules.
 
REISA delegation co-chairs Deborah Froling (Arent Fox), John Grady (Realty Capital Securities) and Bill Winn (Passco), along with experts from Washington Council Ernst & Young, designed and led an ambitious program of visits to the offices of Senators Mike Enzi (R-Wy.), Mark Kirk (R-Ill.), Pat Toomey (R-Pa.), Jack Reed (D-R.I.), Dean Heller (R-Nev.), Tim Johnson (D-S.D.), Ron Wyden (D-Ore.), Heidi Heitkamp (D-N.D.), Mike Crapo (R-Idaho), and Mitch McConnell (R-Ky.), and Representatives Pat Tiberi (R-Ohio), Bill Pascrell (D-N.J.), Nancy Pelosi (D-Calif.), Pete Sessions (R-Texas), Dave Camp (R-Mich.), Ed Royce (R-Calif.), Sander Levin (D-Mich.), and Kenny Marchant (R-Texas).
 
Other members of the REISA delegation were Shim Plotkin (Plotkin Financial), Jason Mattox (Behringer Harvard), Stan Eigenbrodt (Behringer Harvard), Mary Jo Wenmouth (Inland Real Estate Investment), Rick Chess (Chess Law Firm) and John Harrison (REISA Executive Director). Commented Mary Jo Wenmouth on this year’s Hill Day, “I’ve been to a number of these Hill Day programs, and this one was by far the best organized and had very productive meetings.” The co-chairs of REISA’s Legislative and Regulatory Committee, Deborah Froling and John Grady, also visited FINRA and SEC offices to discuss current and pending regulations in addition to participating in meetings on the Hill. “We appreciated the chance to meet with senior staff members at the SEC and FINRA,” Grady remarked. “We were able to have constructive and frank discussions regarding on-going rulemaking initiatives and other matters of interest to our membership.”
 
In a dinner at the National Republican Club of Capitol Hill, REISA delegates met at length with Representatives Ed Royce (R-Calif.) and Gwen Moore (D-Wis.). In the discussions of how best to approach and gain from congressional visits, delegates were briefed on the value of finding the right policy expert on the staff of the member of Congress with whom to discuss concerns.
 
The REISA delegation explored several topics of interest to the alternative investments industry, such as carried interest, entity-level taxation, Dodd-Frank fiduciary standards for broker-dealers, uncertainty around Reg D general solicitation, relationship with FINRA, and other issues. Most helpful were the policy leads in the various offices, since they are at the forefront of with crafting positions for the members of Congress on the particular issues.
 
“One thing not apparent to many visitors to the Hill is the importance of learning to deal with congressional staffers. They are the experts, more so than the senators or representatives, and we do well to brief them thoroughly of how nuanced issues, such as taxation on pass-through entities and commissions to advisors, can have huge unintended consequences,” said Bill Winn, co-chair of the REISA delegation.
 
When approached on several tax issues important to the REISA delegation, Todd Metcalf, tax counsel for Sen. Ron Wyden (D-Ore.), a member of the Senate Finance Committee, said, “by the time something actually passes Congress and is signed into law, there are very few ‘unintended consequences’ any more. Things have been well-researched and thought through, given the number of special interests who make us aware of things; and if a group gets caught up in the net that’s been cast by the law, then it probably isn’t unintended.”
 
“This is one of the major reasons our delegation is here,” commented John Harrison, REISA’s Executive Director. “We have to make it known how those doing good work and protecting their investor clients will be affected by proposals before Congress. If we don’t, then they may not know to consider our point of view.”
 
In the final meeting of the day, the REISA delegation met with Rep. Kenny Marchant (R-Texas), a noteworthy and receptive stop with which to end the delegation’s long day. Said REISA delegation member Rick Chess, “Kenny Marchant, who started his own construction and home-building business and knows the tax code as well as any lawyer, speaks with a blunt honesty which is invigorating. He challenged us to craft specific proposals and analysis, which he may then use in drafting legislation.” It is a challenge the REISA delegation heartily agreed to take on, and one they can pursue in the days following their visit to Capitol Hill.