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Six ways we can improve our response to state tax reform measures…

February 5, 2018
The most striking difference between the state and federal legislative processes is…speed. Bills rarely move quickly through the U.S. Congress, and are often carried over from session to session. State legislative sessions, on the other hand, are typically far shorter – 30, 60, 90 days – which means a bill can move from introduction, to committee hearing, to a floor vote, to the governor’s desk at what seems like warp speed. That’s exactly what happened on a measure to repeal the fraternal tax exemption in South Dakota this year, and what has the potential to happen on a far more complex measure in Oregon. Looking ahead, state legislative and regulatory issues – from solvency to taxation to “best interest” standards for the sale of our financial services products – are likely to consume as much, if not more, of the Alliance’s advocacy resources as our ongoing effort to preserve, protect and promote the fraternal tax exemption at the federal level. Here are six ways – call them “lessons learned” from our South Dakota experience – that the Alliance and its members can more effectively advocate for the fraternal community in future state legislative battles:
  1. An effective early warning system – Knowing what’s out there is the first step to effective advocacy. The Alliance subscribes to an electronic service that provides summaries of legislative and regulatory proposals that would impact life insurers and then whittles these down to determine which measures pose serious threats and which are just political grandstanding. In South Dakota, not only did our early warning system put the repeal bill on the radar screen, two other member societies alerted us to the measure, as well. Having such a system in place – and having the ability to analyze legislation to separate the wheat from the chaff, is critical to our future success in the advocacy arena.
  2. Just the state stats, ma’am – While fraternals’ national impact – in terms of dollars contributed and hours volunteered – is impressive, what lawmakers really want to know is how our members are impacting communities in their state and district. That’s why making sure the Alliance’s “State Sheets” contain the most accurate and up-to-date information on fraternal activities is so important. The only way we can do that is for each member to submit the most detailed information possible on their society’s community service efforts each and every year via the Local Lodge Report.
  3. Individual society statistics – And just as important to our policymaker communication efforts is the information provided by individual member societies on their fraternal activities in each state. These tend to drill down even further and provide more details on the type and impact of activities at the state level. Here is a sample of Modern Woodman's and Thrivent Financials’ Fact Sheets for South Dakota. If every society could produce something similar for every state in which they operate we’d have many more arrows in our quiver when it comes time to let lawmakers know who we are and what we do. If you’ve already created these, please share them with us by contacting Melanie Hinds at mhinds@fraternalalliance.org.
  4. Who knows who? – What we found in South Dakota was that a handful of member societies had very close relationships with state lawmakers. In some cases, society members served as elected officials. This is critically important information to have prior to a bad bill getting introduced. It would be exceptionally helpful if each member society could create a list of members that serve in the state legislature or that have close personal relationships with state policymakers.
  5. On the ground resources – OK, so maybe you don’t have any members that currently hold elected office. But you very likely have individuals in the state that are shining examples of what your society is all about. These could be local chapter leaders dedicated to organizing meaningful community service events, field representatives with a passion for serving not only their clients but their communities, district managers or regional employees who live and breathe your society’s mission. These are the folks we’re likely to call on to testify at a legislative hearing or contact the elected officials to let them know the impact of a bill on their society and the communities it serves. Creating this roster is another item to add to your society’s “to do” list.
  6. Who ya gonna call? – Finally, the Alliance needs the name and contact information for the person at each society who is responsible for maintaining all this state-by-state information. Sometimes it’s the fraternal director. Other times it’s the public affairs professional. In some cases, it’s the CEO. Whoever it is, we need to know who to contact so that we can quickly compile the data, line up witnesses, and organize our political strategy to support or oppose a particular measure.
None of this is particularly difficult.  In fact, I’m guessing most members have compiled this information but have it stored in multiple silos with multiple people responsible for maintaining it. Well it is time to tear down those walls and centralize these functions. The Alliance staff will be working with members for the rest of the year to fine tune this project. Because when it comes to advocating for fraternals at the state level, there is not a moment to lose.