In what amounted to the legislative equivalent of a grand-slam home run, Outdoor Industry Association's (OIA) efforts to secure permanent funding for the Stateside Land and Water Conservation Fund, tariff exemptions for outdoor footwear, and normalized trade relations for Vietnam all sailed through in the closing hours of the 109th Congress.
Congress approves permanent funding source for Stateside LWCF
For the first time, Congress has approved legislation that provides a permanent source of funding for local parks and trails. The precedent-setting legislation establishes a direct source of funding for the Stateside Land and Water Conservation Fund (LWCF), which is not subject to the whims of the appropriations process.
Stateside LWCF has underwritten the development of more than 40,000 state and local park and recreation projects in 98 percent of the counties in the United States, according to OIA.
Sens. Lamar Alexander, R-Tenn., and Ken Salazar, D-Colo., both past Friends of the Outdoor Industry award winners and strong legislative friends of OIA, secured the money for local communities by inserting the provision into a larger bill that will open a portion of the eastern Gulf of Mexico to new energy exploration.
In championing the legislation, Alexander and Salazar were successful in ensuring that the original intent of the LWCF Act is fulfilled by requiring that 12.5 percent of lease sale revenues in the area be used to create or enhance open space, parkland, wildlife habitat, recreation areas or trails. Funds directed to state parks and trails would be small in the initial years, but could reach more than $125 million a year by 2017, and as much as $215 million a year after that.
Best of all, since this source of funding is guaranteed, Frank Hugelmeyer, president of OIA, told SNEWS® that it can no longer be reduced or eliminated through the appropriations process as LWCF funding has experienced in the past.
"The Stateside Land and Water Conservation Fund collects approximately $450 million in receipts each year, all authorized for State LWCF programs, yet Congress and the president have failed to appropriate a significant portion of these funds. OIA thanks Sens. Alexander and Salazar for their vision in dedicating a permanent revenue stream to this program," said Hugelmeyer
OIA made the Stateside LWCF program a top priority because of its importance in providing close-to-home recreation opportunities for all Americans and the role local parks play in promoting an active outdoor lifestyle.
"Everyone who attended the Capitol Summit in the last two years can take credit for this victory," Hugelmeyer told us. "The relationships our members established through direct meetings with members of Congress were invaluable.
"OIA will continue to work with the new Congress to ensure that the program is fully funded because Stateside LWCF is critical to ensuring the active outdoor lifestyle grows and the recreation economy remains healthy," Hugelmeyer added. "It is OIA's belief that the decline in National Park system visitation is partly caused by a decline in local park infrastructure and funding Stateside LWCF directly addresses that decline."
In 2005, state LWCF grants funded projects at Roan Mountain State Park, Panther Creek State Park, Harrison Bay State Park, Rugby State Natural Area and T.O. Fuller State Park in Tennessee. State LWCF funds benefited 17 trail projects throughout Colorado, and paid for improvements at Cheyenne Mountain State Park in El Paso County, Mule Deer Park in Gilpin County and Lory State Park in Larimer County.
Congress approves 12 OIA footwear tariff bills
The House and Senate passed trade legislation containing several OIA-crafted provisions that will eliminate import tariffs on certain kinds of athletic footwear. The legislation will also grant permanent normalized trade relations (PNTR) for Vietnam. Both were top priorities for this first year of OIA's trade program.
The 12 footwear tariff relief measures will apply to certain footwear that incorporates a laminated or coated textile fabric, such as Gore-Tex or Event. It also protects footwear with plastic polymer supports, like those used commonly in trail running footwear. Until this exemption, all of these types of footwear had been classified under custom's duty codes as rubber protective footwear. Ten measures will eliminate tariff rates on these products, some as high as 37.5 percent, and two will reduce tariff rates to 12.8 percent and 15.2 percent.
"We're extremely pleased that tariff relief for specialty outdoor companies was included in the trade bill passed by Congress," said Hugelmeyer. "Manufacturers and retailers of outdoor performance footwear can look forward to substantial savings and remaining very competitive when developing and launching new innovative products."
What this also means, Hugelmeyer told us, is that when the tariff reduction goes into effect the beginning of 2007, the immediate savings will allow manufacturers to take the money that would have otherwise been spent on tariffs and instead put it into research and development to add technical features to existing footwear without having to raise the price. Or, lower the price of existing technical outdoor footwear to make it more competitive with mass-market shoes.
In the past year, OIA led a trade working group of several dozen member companies, which included The North Face, REI, W.L. Gore, Columbia, Patagonia and EMS, that assisted in drafting the tariff relief bills with many also joining OIA in Washington, D.C., to lobby.
OIA also worked in conjunction with several members and a broad coalition of American businesses from a variety of industries to advocate for Vietnam's permanent trade status. Currently, the outdoor products made in Vietnam have a retail value of over $100 million. The new trade legislation now makes it easier for U.S. companies to do business there.
OIA's trade agenda for next year includes working on additional tariff relief measures for other outdoor products, especially various apparel categories, Hugelmeyer tells us.
"We have asked for a review by the International Trade Commission to find product categories that are non-controversial, so we can work with member companies to once again revisit reduction of appropriate duties," Hugelmeyer told SNEWS®. "Members of the ITC will be at Winter Market at OIA's request conducting this review."
OIA said it hopes that by June there will be product categories identified that it can then go to work on to either move products into correct custom codes to reduce duties or seek non-domestic production tariff exemptions.
The legislation is expected to be signed by President Bush in the next few weeks with the duty eliminations taking effect 15 days later and Vietnam PNTR applying immediately after the bill becomes law.
SNEWS® View: Anyone who has, and you know who you are, in the past debated the worth or value of membership in OIA can now take a seat please and be quiet. Better yet, send your membership check in now, especially if you are a footwear manufacturer for goodness sake. Because of OIA's lobbying efforts, hard work behind the scenes in Washington, D.C., meeting rooms and legislative offices, and listening to membership needs, this industry will realize millions of dollars in savings that would have gone simply to tariffs. And, manufacturers are not the only ones to benefit by this, but specialty retailers too, as the resulting price reductions and technical improvements to footwear will make the products they sell all the more competitive.
And, if you have never attended a Capitol Summit, now you know how important industry participation is. As a member company that has never missed the event, we agree with OIA that LWCF would NOT have succeeded without the lobbying and relationships established before, during and subsequent to the last two Capitol Summits.
Do yourself and this industry a favor and look into attendance at next year's Capitol Summit 2007, April 17-19, in Washington, D.C. It truly is "your best chance to discuss our industry's economic contribution and the issues affecting your business with the decision makers in Washington, D.C."