Choosing Sides in the 2012 Elections

The National Grocers Association is putting its money where it wants its voice to be heard.

Beginning early in 2012, Arlington, Va.-based NGA has been raising funds for its new Political Action Committee, called Grocers PAC, and has tallied an average of about $5,000 a month in contributions from individuals and from other PACs.

“In January of this year we reconstituted our PAC, and set the goal to raise $50,000 this cycle, and we are on target to reach our goal,” said Tom Wenning, executive vice president, NGA. “Looking to the future, we are hoping we are able to get to the point where we are able to raise a few hundred thousand dollars in the next congressional election cycle.”

While the total NGA spending pales in comparison with the billions of dollars that will be spent on the presidential race between incumbent President Obama and his Republican rival, former Massachusetts Gov. Mitt Romney, and on other national and local elections, NGA and others in the food-retailing industry are hoping to have some influence over some key races.

As expected, supermarket operators and their associations predominantly favor Republicans with their contributions — although some Democratic candidates are getting support this year as well — while the United Food and Commercial Workers Union backs the Democratic Party.

Another key difference between the industry’s business operators, as reflected in their associations, and the people who work in the stores, as reflected in their union, is that the retail associations are providing funding exclusively for congressional candidates, while the UFCW is focusing on the re-election of Obama, as well as on congressional and state races.

“We believe there is nothing more important than the presidential election,” said Tim Schlittner, a spokesman for the UFCW. “President Obama has proven to be a president who supports workers, and we want to continue with the progress he has made in the last four years.

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“On the other hand his challenger has shown himself as someone who is aligned with the wealthy and special interests.”

The business side of the industry and the union are at odds on some key issues that could be decided in this year’s election, especially the tax code and the function of the National Labor Relations Board, which many retailers claim has shifted to become too pro-labor under Obama.

The UFCW, however, believes Obama has guided the NLRB back toward the center.

“We believe that the NLRB should be a fair referee, and the NLRB under President Obama has begun to get back to that,” Schlittner said. “Unfortunately it became ‘The National Business Board’ under President Bush, when it is supposed to be a fair arbiter between employees and employers. We wouldn’t want to go back to a board that makes business their priority instead of the actual mission of the NLRB.”

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On tax issues, the union also favors the Democratic positions, he explained, while retailers are concerned about the costs of potential hikes.

“There have been 60 measures of the tax code that expired in 2011 and another 40 that are expiring in 2012, and a majority of those directly affect our members in their planning and in determining the future of their investment,” said Wenning of NGA. “Without those issues being addressed, whether it is income tax issues for their businesses and depreciation, or whether it’s estate tax — those are key issues that our members have told us are front of mind.”

That is leading NGA to target its election contributions toward members who serve on the House Ways and Means Committee and the Senate Finance Committee, he said.

“We’re trying to inform them about the importance of tax policy going forward, not only this year, but in 2013 when they start to address tax reform,” Wenning explained.

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Through July, NGA’s Grocers PAC had raised $33,250, according to filings with the Federal Election Commission. That included $25,250 in contributions from individuals and $8,000 from other PACs, in so-called PAC-to-PAC donations.

Recent disbursements from the PAC have included $2,500 for the campaign of Rep. John Boehner, R-Ohio, the Speaker of the House; and $1,000 for the campaign of the Senate Minority Leader, Sen. Mitch McConnell, R-Ky., who is a senior member of the Senate Appropriations, Agriculture and Rules committees.

Grocers PAC has also made several other donations to various members of Congress, including $1,000 to Gillibrand for Senate, which supports Sen. Kirsten Gillibrand, D-N.Y., who sits on the Senate Agricultural Committee. Recent polls show Gillibrand has a substantial lead over her Republican challenger, Wendy Long.

Senate Is Focus

At Arlington, Va.-based Food Marketing Institute, Jennifer Hatcher, senior vice president of government and public affairs, said the balance of power in the Senate — where Democrats currently hold a 53-to-47 advantage (including two Independents) is a key area of focus for Food PAC, FMI’s PAC, in this year’s election.

A recent analysis by Real Clear Politics projected 48 likely Democratic seats after the election, and 46 seats that appear likely to be held by Republicans. The remaining six are seen as toss-ups, including races in Montana, North Dakota, Indiana, Virginia, Connecticut and Massachusetts.

“A big issue is control of the Senate,” Hatcher (right) told SN. “Will Republicans gain control, or will the Democrats maintain control?”

The recent congressional gridlock — particularly in the last two years, Hatcher noted — has made it difficult for legislation to move.

“With an increasing number of folks both on the far left and the far right, with a dwindling group in the middle, there have been a number of issues where it has been more challenging to come up with a compromise,” she said.

This situation is exemplified by the lack of progress on any appropriations bills in the Senate this year, she noted.

“Part of our focus is looking at how these races influence the ability to get things done,” she explained. “With Republican control in the House, and Democratic control in the Senate and Democratic control in the White House, it’s been a challenging time to get anything accomplished.”

NGA’s Grocers PAC has also weighed in on several of those key Senate races, with support for candidates like Republican Sen. Scott Brown in Massachusetts, who is locked in a tight race with consumer advocate Elizabeth Warren, a Democrat; and Rep. Denny Rehberg, R-Mont., running to unseat Democratic incumbent Sen. Jon Tester. NGA also supports former Virginia Gov. George Allen, the Republican running for Senate there against former Gov. Tim Kaine, a Democrat.

Hatcher said FMI’s Food PAC has been bipartisan in its contributions — although historically it has been predominantly Republican — and is focused solely on congressional races in the House and the Senate, not on the presidential race or any local state races.

“We certainly are bipartisan, and that’s important to us, but we don’t come up with a percentage and say we have to have this much in this bucket, and this much in that bucket,” she told SN. “Particularly in the Senate, because of the way the cycles are with one-third of the Senate opening up every two years, there might be one cycle when a lot more Democrats come up, then another cycle might have a lot more Republicans come up.”

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The association’s approach to Food PAC, Hatcher explained, is to steer its contributions into three general areas — legislators with whom FMI member companies have strong relationships; legislators who have been helpful working on issues of importance to the industry; and legislators who serve key roles on congressional committees or subcommittees.

Donations come from individuals or from other PACs — about 10 FMI member companies have PACs — and although the donations are not earmarked for specific candidates, FMI members tend to be in contact with the association about which races and legislators they consider important.

As of its July filing with the FEC, FMI’s Food PAC had given about three-fourths of its contributions to Republicans, although some key Democrats in both the House and Senate have received funding for their campaigns — notably Sen. Dick Durbin of Illinois, whose Durbin Amendment on the financial reform legislation introduced the federal regulation of debit-card interchange fees, something long sought by the industry.

In the House, FMI’s Food PAC has contributed about three times as much to Republicans as to Democrats, according to Center for Responsive Politics, which tabulates information from FEC filings.

Estate Tax Crucial

Although NGA’s Grocers PAC — like FMI’s Food PAC — is focusing specifically on congressional races, and not contributing to the presidential race, Wenning noted that NGA members are concerned about President Obama’s position on some issues, notably taxes — including the estate tax — and his appointments at the National Labor Relations Board.

“We know where the president stands as far as raising taxes on what he calls ‘millionaires’ but actually can apply to entrepreneurs who own businesses and operate them as sub-Chapter S corporations,” Wenning said. “A lot of members would be substantially hurt by that.”

NGA supports the Republican platform on the estate tax, which calls for preserving the current rate at 35% for one year — with the first $5 million of an inherited estate exempt from taxes for individuals and the first $10 million for couples.

“That would give families and businesses some certainty for one year, and then Congress could try to tackle reform in 2013, which is what we support,” said Greg Ferrara, vice president of public affairs, NGA. “We certainly support the elimination of the estate tax, but that’s not likely to happen in the near future. So the next best thing for us is to make what we have today permanent, and that will hopefully be a part of tax reform going forward.”

In addition to providing funding through their PACs, NGA and FMI members also work with state associations and in other ways in various areas around the country to both help raise funds for congressional campaigns and to help educate members about industry issues.

“It’s important to do things like store tours,” said Ferrara. “To take the elected official or the candidate around and actually show them how country-of-origin labeling is working, show them food safety is practiced in our stores, show them how energy impacts us, and talk about tax policy.

“We have had a lot of success with members who have done that, and have a lot of other members who are looking to do that as well. Never take for granted that the elected official understands your business, and you can take advantage of opportunities to educate them about that.”

Wenning said the relaunch of the NGA’s Grocers PAC has been a success.

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“We’re very excited about the opportunity and the response we’ve gotten from our members, and from our board of directors, to be engaged in the political arena,” Wenning said. “Even though it’s been a small amount in this cycle, we are already seeing that it is beneficial to the members and the NGA to be engaged in this process. We’ve very pleased with the results that we’ve been getting.”

NGA previously had a PAC but had replaced it with what Wenning described as congressional education activities, which include lobbying on issues of importance to independent grocers and their wholesalers.

“Over the years we’ve found that it’s more important now to not only be involved in educating congressional members, but also to be involved in the election process, and to support candidates and congressional officeholders who support the independent grocer and the wholesaler that serves them,” Wenning said.

Sidebar: NGA, FMI Seek  ‘Bagging’ Rights

The National Grocers Association and Food Marketing Institute both have incorporated grocery bags into their election efforts this year.

NGA staged a “best bagger” competition on Capitol Hill in June to raise awareness for the industry, and independent grocers in particular, while FMI staged a bagging fund-raiser of its own in conjunction with the Republican National Convention in Tampa, Fla., last month, and also handed out party-specific reusable grocery bags at both parties’ conventions.

“It was a fun event,” said Tom Wenning, executive vice president, NGA, of the bagging competition. “A lot of members came and watched the contest, and had an opportunity to learn about NGA and get some information about who the independent retailers are in their community and how they serve their consumers.”

FMI, meanwhile, partnered with the charity Feeding America for a grocery-bagging event during the Republican Convention, donating the bags of food to Tampa-area families.

“We did attend both conventions and had a presence,” said Jennifer Hatcher, senior vice president of government and public affairs, FMI. “We gave reusable grocery bags to all members of the House and Senate.”

The bags for Republicans had a picture of an elephant, and the ones for Democrats had a picture of a donkey.

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