From a California IC law to new taxes, 2019 has been a busy year for ASTA

Eben Peck, ASTA’s executive vice president of advocacy, speaking at the Society’s Global Convention.
Eben Peck, ASTA’s executive vice president of advocacy, speaking at the Society’s Global Convention.

FORT LAUDERDALE -- Over the course of a normal year, ASTA works to promote its members to the public and advocate for their interests with federal, state and local governments. Its advocacy work addresses spot issues, like state taxes, as well as ongoing priorities, such as a federal bill that would harmonize the definition of employee versus independent contractor (IC) nationwide.

But 2019 was not a normal year.

So far, ASTA has helped kill proposals that would have put additional taxes on agencies in six states, and it helped mitigate new taxes in a seventh.

It also secured the reintroduction of a bipartisan federal bill that would help agencies use an exemption from federal labor rules designed for retail businesses, and it helped grow support for a bill that would undo the travel ban on Cuba, among other initiatives.

Most notably, the Society is currently in the midst of an ambitious, unprecedented fight in California as it attempts to win an exemption to new rules that dictate which workers are ICs and which are employees.

"It has been a pretty extraordinary year," Eben Peck, ASTA's executive vice president of advocacy, said last week at the Society's Global Convention at the Diplomat Beach Resort here.

A 'gargantuan task'

The work ASTA does is not easy.

"It is a gargantuan task, but this is what you have a national trade association for," Peck said. "This is a key reason why our members pay their dues every year. ... The scope of the challenge should be a wake-up call to those in the industry not supporting ASTA. The more members we have, the more we can do in more places."

ASTA is just about to hit 12,000 members after striking a deal with Ensemble Travel Group. The consortium has joined many of its peers in mandating membership in ASTA, bringing 242 new members.

Members are key to what the Society does, Peck said: They are ASTA's eyes and ears, especially at the state level, and they help staff fight harmful legislation.

Oftentimes, legislators attempt to sneak policies through, Peck said. ASTA uses legislative tracking software to identify things of concern, but members are also key to that endeavor, alerting the Society to new proposals they hear or read about.

The number of issues ASTA deals with at any given time can be frustrating, especially in years like 2019.

"But again, this is our job, and no other organization does this work at so many levels on behalf of the industry," Peck said. "Our members put their confidence in us, and we do everything we can to stay on top of things and fight and win on their behalf."

Federal and state work

In the past year, ASTA has had success on the federal level.

In late 2018, it won a fight against new disclosures advisors would have to make to consumers that were unveiled in the FAA reauthorization process. ASTA estimates the disclosures would have resulted in $29.8 million lost annually in "talk time" and lost sales.

The Society also had a win with the Travel Advisor Retail Fairness Act, which has been reintroduced in the House of Representatives. The legislation, which has bipartisan support, would remove travel agencies from a so-called blacklist of industries barred from using a retail business exemption from federal labor rules.

ASTA also had a meeting in the White House regarding the topic last month. Peck said he walked away "cautiously optimistic" that the Department of Labor might revisit and update the list.

On an ongoing basis, ASTA is also working to grow the number of co-sponsors for a bill that would harmonize the federal definition of employee versus IC as well as grow the co-sponsor list for legislation that would undo the ban on unfettered travel to Cuba.

Funding for its political action committee reached an all-time high last week, with more than $400,000 raised so far in 2019.

Odd-numbered years, budget introduction years for many states, tend to carry with them proposals for new taxes that could impact the agency community, and 2019 was no exception. ASTA successfully fought a number of proposals through grassroots campaigns.

Connecticut, Nebraska and Utah this year attempted to expand sales taxes to travel agency services. ASTA also helped kill proposals in Indiana, Texas and Vermont to expand state and local taxes to agency hotel fees and markups. In Washington state, ASTA helped keep in place a reduced business and occupations tax rate for most agencies.

The Society also worked with the U.S. Travel Insurance Association in reforming complex travel insurance licensing in 48 states and Washington, D.C., providing agencies with training and licensing cost savings of more than $10 million.

A battle in the Golden State

In California, ASTA continues to fight to have agencies listed as exempt from Assembly Bill 5 (AB5), which changes the test used to determine which workers are employees and which are ICs. ASTA has sent members and staffers to the capital, Sacramento, multiple times this year to testify and meet with legislators. It is also encouraging members and suppliers to send letters and make calls on the industry's behalf.

"This grassroots campaign that we have led and participated in is really unlike anything I've ever seen since I've been here in terms of sheer numbers, in terms of intensity," Peck said.

So far this year, a record 3,200 emails or calls have gone through ASTA's grassroots portal on its website.

ASTA has fought many battles against state taxes and has a good sense of what it takes to win, but AB5 is something different altogether, Peck said. While he doesn't know if ASTA will ultimately be successful, he said the Society has done something that is consistently effective with legislators: meeting with them in person to make the industry's case.

We're getting their attention," he said.

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