Small-business owners concerned about increasing regulatory mandates from Washington gathered in Denver to complain directly to federal officials Tuesday morning.
And complain they did, about issues such as a requirement to track drugs, immigration reform and tax policy.
The most contentious complaint involves a pending U.S. Food and Drug Administration regulation that pharmaceutical supplies must be tracked from manufacturer to final dispenser.
Chinook Medical Gear of Durango has stopped making medical kits used by the military in Iraq and elsewhere because it can’t provide the so-called pedigree of all the medicines it uses, said Kathleen Keesling, a sales director at the firm.
“This is touching our troops,” she said. “We find this is unduly stressful on a company our size.”
Mark Snyder, chief executive and president of Superior Medical Supply in Broomfield, said he doesn’t object to tracking drugs, which is designed to screen counterfeits. But the FDA has exempted the nation’s three largest drug distributors, who control 90 percent of the market, from the chain-of- custody regulation, making it difficult to maintain a pedigree, he said.
Without a complete reporting chain, independent distributors are left vulnerable to stiff fines or even prison sentences, he testified before the federal regulatory-fairness hearing hosted by the Small Business Administration’s Office of the National Ombudsman.
“We will be out of business by Dec. 1. Without us, lives will be put at risk,” Snyder said.
The FDA said in June it would push forward with final guidelines by December, focusing first on drugs most susceptible to counterfeiting.
Colorado legislators compounded the problem by passing a law that mimicked the federal rules late in the state legislative session, Keesling said.
“We were not given any warning this law would be passed,” Keesling said.
Nicholas Owens, the national ombudsman for the SBA, fielded the complaints before an audience of about 45 people.
Representatives for most of Colorado’s congressional delegation and several government agencies were also present.
Colorado’s nearly half-million small businesses generated $18.4 billion in income in 2003. Those firms had more than 350,000 workers, according to the most recent statistics available from the SBA.
Harold Jackson, CEO of Buffalo Supply Inc., a Lafayette-based medical-supply company, objected to a pending requirement that government agencies withhold 3 percent of a federal contract’s value upfront to pay taxes.
The change, expected in 2010, will unnecessarily tie up $1 million of the company’s cash flow a year, forcing it to borrow funds, he said.
Immigration reform also came up. A guest-worker program with strong enforcement is needed, testified James Helgoth, president of Elward Systems Corp., a Lakewood provider of composite panels used in construction.
“The magnet of jobs in the United States coupled with employers’ thirst for inexpensive labor will continue to lure undocumented workers,” he said.
Colorado recently passed stricter laws regarding illegal immigrants. Employers could find themselves at a disadvantage in attracting laborers, some construction contractors fear.
Owens responded that immigration reform was a public-policy issue beyond the scope of his office. But he promised to bring the other complaints raised to the proper channels.
