NRF in Washington: Advocacy update May 2023

The 118th Congress is in full swing as lawmakers work toward achieving priority policy goals despite a narrowly divided legislature. Congress’s recent attention has been on raising the debt limit and dealing with the southern border. While both are impactful to the retail industry, and the U.S. economy, here are a few priority issues retailers are tracking.

Reining in organized retail crime

Organized retail crime is a persistent and growing problem that impacts retailers, their customers and the communities they operate in. The increased scope and complexity of ORC activity not only results in billions of dollars in financial loss for retailers, but also endangers store employees, associates and customers and disrupts store operations.

NRF and K2 Integrity recently released Organized Retail Crime: An Assessment of a Persistent and Growing Threat, a comprehensive report on U.S.-based ORC groups, their tactics and techniques for theft and resale, and their links with other types of organized crime. The report also identifies critical gaps in the current understanding of ORC. The report’s key findings highlight the need for federal policy to combat these burgeoning crimes.

NRF strongly supports the Combating Organized Retail Crime Act (S. 140/H.R. 895), which would help address the significant deficiencies in the availability of consistent and consolidated ORC data across national, state and local authorities by establishing the Center to Combat Organized Retail Crime at Homeland Security Investigations. Increased coordination between law enforcement and the retail industry is a critical step toward countering ORC.

On June 27, the NRF-supported INFORM Consumers Act will go into effect. This new law will work to curb the resale of stolen merchandise online.

Swipe fee reform

Retailers of all types and sizes continue to pay a record number of swipe fees, which have become the second highest operating cost after labor. Last year, U.S. merchants paid $160.7 billion in processing fees, up 16.7% from the previous year even though purchases for goods and services tied to card payments grew by only 12.3% over the same period.

This problem stems from the fact that two major credit card networks control 80% of the market, allowing them to centrally set fees charged by the nation’s largest financial institutions that issue these cards. That leaves retailers and other merchants with no negotiating power or choice.

NRF continues to push for reform in the credit card routing market through the Credit Card Competition Act. The bill, which is awaiting reintroduction, would require the nation’s largest credit card-issuing financial institutions to enable a competing network to route credit card transactions. Swipe fee reform through increased competition is estimated to save $11 billion per year.

Meaningful immigration reform

The House’s passage of the Secure the Border Act on May 9 was an important first step toward meaningful immigration reform. NRF has been involved in discussions with members of Congress on both sides of the aisle and both sides of the Capitol as part of our efforts to achieve a modernized immigration system. NRF has long held that a functioning immigration system is necessary to address retailers’ need for eligible, legal workers.

Following House passage of border security legislation, NRF will urge Congress to find middle ground and overhaul our dysfunctional immigration system to foster legal immigration pathways to the country. Another important step Congress can take is to pass the bipartisan Dream Act, which would end the legal uncertainty surrounding people who were brought to the United States as minors. NRF will continue to work with Congress to achieve bipartisan solutions to fix our nation’s immigration laws.

The future of workforce and labor policy

Retailers continue to face significant challenges on the labor and workforce front. The ongoing labor shortage, pending regulatory actions and supply chain-disrupting labor disputes have all impacted retailers and their employees. NRF has long advocated for balanced labor laws that spur job creation and economic growth.

Concerned with the future of labor policy and regulations, NRF is closely tracking the nomination of Julie Su to serve as Secretary of Labor. On April 26, the Senate Committee on Health, Education, Labor and Pensions voted along party lines to advance her nomination. The nomination is now under full Senate consideration. NRF has repeatedly expressed our concerns about Su’s track record of hostility to business and her lack of experience in resolving disputes that could negatively impact the supply chain.

Trade and China competitiveness

Congress’ focus on China could have larger impacts on retailers’ broader trade agenda priorities. The anti-China sentiment driving the congressional trade agenda has resulted in discussions on revoking China’s permanent normal trade relations status, continuing the harmful Section 301 tariffs and reducing de minimis thresholds. The sentiment also complicates efforts to renew expired beneficial trade programs, such as the Generalized System of Preferences program and the Miscellaneous Tariff Bill.

NRF continues to call on Congress and the Biden administration to seek alternative measures to address China’s unfair trade practices, such as working with allies through new free trade agreements and partnerships, realigning the Section 301 tariffs, retroactively renewing expired trade preference programs and supporting efforts to diversify supply chains.