Q&A with MRAA Washington representative Larry Innis

Posted on Written by Reagan Haynes

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Larry Innis is no stranger to Capitol Hill. The legislative veteran has been testifying before Congress on issues ranging from the Coast Guard budget to the Sport Fish Restoration and Boating Trust Fund on behalf of the Marine Retailers Association of the Americas for a quarter of a century.

After spending 2-1/2 years on the staff of the Coast Guard subcommittee of the House Committee on Merchant Marine and Fisheries, Innis was hired by the marine retailers’ trade organization as a contractor to set up its first Washington, D.C., office in March 1989. He has been lobbying members of Congress on behalf of the boating industry ever since.

As the MRAA’s Washington representative, Innis writes the Washington Watch newsletter, as well as calls to action for members. He played a leading role in the creation of the Marina Operators Association of America — which later became the Association of Marina Industries — and the Marine Environmental Education Foundation. Both organizations were established to better serve the interests of marine retailers who operate marinas and boatyards. Innis was chairman of National Clean Boating Week in the outreach campaign’s first three years and he created the voluntary Clean Marina program.

He served a six-year term on the National Boating Safety Advisory Council (appointed by the secretary of transportation), which advises the Coast Guard on boating safety matters such as life jackets, prop guards, boating safety education and operator licensing.

He also has worked on state legislative issues in conjunction with regional marine trade associations, including boating safety issues and dealer bills in Alaska, Texas, Missouri, Oklahoma, Louisiana, Maryland, Maine, Ohio and Michigan.

The American Boating Congress enables industry members to get the undivided attention their representatives in Congress.

The American Boating Congress enables industry members to get the undivided attention their representatives in Congress.

Ahead of this year’s May 5-7 American Boating Congress, Soundings Trade Only caught up with Innis to ask him about the evolving ABC and discuss the hot topics for this year’s session.

Q: Can you talk about the American Boating Congress this year and what participants can expect?

A: I’m certainly excited. I think there are 36 co-hosts this year so far, and that’s already more than there were last year. It’s everybody in the industry — manufacturers, dealers, distributors, state associations, boatyards, marinas. It’s a really great group of people.

It’s really going to be a good event, and I encourage everybody to come — the more, the merrier, because we are faced with issues. If we’re for an issue, there’s always somebody against us. Just look at the ethanol issue, where the ethanol producers and manufacturers are having a conference and they bring in thousands of people on the Hill. They have a big conference, with entertainment such as Led Zeppelin as a draw. So we need everybody we can get to come.

Q: In my short time covering the event, I’ve seen some growth and traction. How have you seen ABC evolving through the years? How do you get the message out about the event and the issues?

A: We do it through our website and press releases, through the newsletters that I write. When I speak in front of marine trades associations I encourage them to participate. I think there is more marketing going on among the industry. I think that when the National Marine Manufacturers Association moved to co-hosting the event and encouraging co-hosts, that was a significant change. It went from being more or less a manufacturer-based event to being a whole cross-industry event, and I think we’ll continue to see it grow.

Engine problems caused by ethanol in gasoline continue to be a major industry issue.

Engine problems caused by ethanol in gasoline continue to be a major industry issue.

Every industry has a Washington event. I know people may not want to come to Washington — a lot of people don’t like what’s going on in Washington — but it’s so important to meet with legislators and their staffs on issues that are important to their business.

Q: I’m sure you hear often that they don’t like the way things are functioning, so they don’t want to participate. How do you approach that head-in-the-sand mentality, and do you see more people becoming active, even if they do feel more frustrated?

A: I think people recognize that the events in Washington impact their business, sometimes for the good and sometimes not. I think there is a greater desire these days to participate and to be involved and influencing a member of Congress.

Whenever I speak before a group, usually I give people an assignment. I ask them to get to know the issues that affect their business and ask that they get to know their legislative member, local, county, state or federal, and to invite them to their business, give them a tour and introduce them to their employees. I ask them to contact them, talk with them and work with them on what it is that’s important to them — their businesses, the local economies — as well as share how they can grow business, how they can grow jobs. I think more and more people are starting to recognize that is important to do.

Innis expects Congress to consider and perhaps approve some tax breaks this year.

Innis expects Congress to consider and perhaps approve some tax breaks this year.

Just look at boating. People buy a boat to get away from all that kind of stuff. They want to buy a boat and be free. I think people in our industry, to a great degree, are boaters. They have that attitude of wanting to be free, and government regulations and rules take that away from them, so they’re getting involved more and more. They’re seeing that excessive regulations and rules are taking that freedom away and they want to participate to change that.

Q: Sometimes when people are less involved, this process can be more daunting. How do you help people become comfortable speaking to the issues?

A: Washington certainly can be intimidating. It’s difficult for many. I’ve been to many meetings with members or staff with people in our industry, and they want to present themselves professionally and well, and they’re concerned with how that comes along. They want to know what they should say, how they should say it. I think as an association we need to educate and train our people, provide them with the information they need and background materials on the issues.

We should also give them information on how to write a member of Congress or communicate with them during a face-to-face meeting. We try to do that. NMMA and MRAA individually have sidebar meetings with participants. We put information on our website all about education and what to do, and how to communicate with Washington, D.C. I think it’s part of our job to make members feel at ease.

The most confusing thing about Washington is just how big and complicated it is. There are so many different committees on the Hill doing this and that. It’s difficult to put all that together for a lot of people. That’s what we try to do for them.

Q: Do people have an easier time if they are used to dealing with their local governments? They seem to be more manageable in size.

A: They appear to be less formal, too, and quicker-moving. Washington sometimes moves very slowly, so it’s frustrating to get something passed when it takes two and three and four years.

Q: I imagine that plays into some people’s hesitance to participate.

A: I think so. I think as they feel more at ease, it helps, so we ask people — not just coming to ABC, but throughout the year — to contact a member of Congress as a way to get comfortable. They do it. We provide … some basic language, and more and more people are doing it. But I fear that Washington, D.C., is a little scary to a lot of small business people. Even if they contact their local members and know their local city council member or state representative, the idea of coming to Washington and walking around in that big Capitol building is sometimes intimidating. Sometimes it’s hard to make the leap.

I think once you do it — contact an office and talk to a staff person — you realize they’re just people and they’re there to be educated and understand. They want to know what the impact of an idea or bill would be on their constituents. They’re eager to learn. It becomes less intimidating than it once was. The key is to take that first step, and ABC is providing that opportunity. The MRAA and NMMA provide position tables and guidelines and as much guidance and education as we can to make the experience a good one.

Q: How productive do you think Congress will be in 2014?

A: This is an election year, and as we get closer and closer to elections, the leaders of both parties will be doing things without any intention of passing it, or of it becoming law, just for the politics. It’s very difficult to weed through what is real and what is not real during an election year.

Congress this year is starting to work more together than in prior years. We have been hearing about bipartisanship kind of coming back and that they’re working to come up with solutions. So this is a very interesting year because of the politics involved, and the perception may be out there that the American people want Congress to work more together because their approval rating is only 10 percent.

So we didn’t have a problem over the debt limit recently, we didn’t have a problem with the extension of unemployment benefits, we didn’t have a problem with passing a budget in December or appropriation bills, as we have in the past, where they closed down government for two weeks.

Q: Do you think this election cycle is unusual because there has been such an impasse and people are so fed up, they [Congress] do need to find common ground on some issues so they can at least say they got something done? And might the boating industry benefit from that?

A: Ethanol is one they can work together on, and it’s also interesting because the lead right now in a renewable fuel repeal is taking place in the Senate. The House is sitting kind of watching what the Senate is doing because they want to move on something that’s more bipartisan.

My gut tells me there are probably enough votes in the House on the Republican side to pass an ethanol repeal or modification, but they’re not bringing it up yet. They’re waiting to see what happens in the Senate. So the Cardin bill, there’s action on it. I feel optimistic that they’re going to hammer out something in the Senate first, and I think the House is going to act on whatever happens in the Senate.

My feeling is they’re going to try to hammer out something to repeal the E15 mandate. They may rescind that, they may make changes to the blend wall, but as of now I would guess there’s going to be a decision to keep ethanol at E10 instead of totally repealing it.

I think it’s going to be very important at ABC for the industry to reiterate the effects that higher levels of ethanol blends have on outboard motors and marine engines, the high cost of maintenance for boaters and the safety issues. When a boater breaks down, it’s usually out on the water somewhere or in the hot sun, and they have a fear of what’s going to happen to them. They have to wait for a tow or for help somewhere along the line to get them back.

If we go into Congress during ABC and emphasize this again, I think the timing is good. We need to emphasize the higher levels, like E15, and that the ethanol producers are wanting to push E35 and E85. It’s mind-boggling what it would do to our industry. The timing is good to push that issue. There’s a good chance it will pass at some level this year.

Funding for dredging projects is expected to be a congressional topic this year.

Funding for dredging projects is expected to be a congressional topic this year.

Q: That’s an issue that five years ago people didn’t know much about, but that has completely changed.

A: I think so. I remember walking on the Hill five years ago and talking about the problems with ethanol, and I remember getting one deaf ear after another. You could just see on the staff people’s faces, they just didn’t want to hear it. They wanted a clean environment.

Now they’re starting to recognize that there is a problem, with millions of acres of wetlands being converted to farmland to grow more corn. They’re starting to see this has an environmental impact that is negative and that is a direct result of, year after year, people in our industry and in other industries coming to Washington and talking about the effects of ethanol.

Even more environmental groups are getting on board because of dead zones in the Chesapeake Bay and the elimination of wetlands. I think some of the environmental groups are starting to understand that ethanol may not be the best oxygenator of gasoline. Maybe there’s another product we could use. And the Department of Energy is doing research with boat manufacturers and others to try to find another product that would be a little bit better for the environment and protect our engines and the safety of users.

Q: What other issues are coming up for ABC, not necessarily just on the MRAA’s radar, but also for the overall industry?

A: As far as the overall industry is concerned, ethanol is a big issue and invasive species is another big one. I think somewhere Asian carp is going to need some attention.

I think dredging and WRDA is going to be an issue this year. We passed the Water Resources Development Act for the first time in several years, and this provides money for Army Corps of Engineers dredging projects. I think there may be some attempt to start another WRDA authorization. They’re supposed to do it every year, but they haven’t been getting that done recently. But I think we’re going to have dredging come up as an issue. A big issue probably within the Sportfish Restoration Trust Fund will be access to water. We have to continue to provide people access.

Some people are talking about the Marketplace Fairness Act. We’ll have to figure out if that’s an issue the industry should put on the burner. The act would allow for the collection of sales tax on Internet sales, but exempt small businesses that have less than $1 million in annual Internet sales. We like the fairness because our guys have been competing against catalog sales for years and years, and they don’t pay taxes. For some states, it’s getting up to 8.5 percent.

It’s kind of been personal for some of our members because their customers talk to them about a product, but buy it on the Internet without paying sales tax. Then they ask the dealer or marina for advice on how to install it free. In the past we’ve supported it, so I’m not sure if it’s going anywhere, so we’ll have to watch that carefully so people aren’t spending time on an issue that’s dead.

We haven’t touched on taxes. We didn’t include that on any of our lists this year. I think Congress will pass the tax extenders bill, some of the Bush tax cuts that many people have passionate feelings for and against, but there’s estate tax repeal that’s been important to us for a long time. I think that’s going to be passed, and I think they’re going to pass it at the same level as what it was last year. So the exemption would be $5 million. That is good for many marinas because many are valued between $5 [million] and $10 million. That’s going to help some people in our industry.

It is a tax on your death. It was one of the first taxes passed by Congress, and it was passed to fund the Spanish-American War. It was implemented before the income tax. When your estate is valued independently over a certain amount of money — it was $5 million as of Dec. 31, but it reverted back to something in the area of $3 million — so this exempts the first $5 million of an estate. So if a couple owns a marina valued at $10 million, one person dies, half of that would be owned by the surviving spouse, so they wouldn’t have to pay taxes on the other half of the estate. And this affects family farms, and ranches, small businesses. We have been in favor for many years and watching that. I think it’s going to pass.

Congressman Dave Camp from Michigan, chair of the Ways and Means Committee, has been floating around a draft tax rewrite bill, but I think they’re just going to run out of time this year and there won’t be enough legislative days left for it. They spend more and more time campaigning as you get closer to elections. So I don’t think it’s on the agenda for this year, but it is still an issue we’re watching.

There will be a tax extender bill, maybe, but not a major rewrite to the tax bill where we have a flat tax or something like that. Second-home interest deductions are another topic. We want them to keep the deduction for boats. There’s talk of eliminating it or reducing the amount you can take. Right now, it’s $1 million.

The mortgages total cannot exceed $1 million, and they may cut that to $500,000. Most of the people who take this are not buying the kind of yachts that people think of. Most people who buy yachts can’t use this because the value of their home is too high to qualify.

This is something that a truly middle-class person considers because they choose to have a boat for a weekend home, a getaway place. Some people who work in auto plants in Michigan will have a fishing cottage on the lake that they maybe built themselves. Other people maybe have a smaller boat they go down to, and it’s worth $100,000 or $50,000, but they need the deduction in order to make it work for them financially. We support that.

Q: The recreational industry seems to be speaking with a more cohesive voice and speaking more to the economic impact of recreational boating. How do business owners play into the overall industry voice being heard in Washington? How important are those voices, and how do you convince dealers who don’t want to participate how important it is?

A: It’s so important and you know, it’s important for a politician to have a whole group of different organizations like [those that] are coming to ABC and to hear all those different organizations united and supporting an issue. If one person comes up there, it’s one voice, but if you have many, it’s a movement. They recognize that, “wow, maybe I should listen to these guys.”

When you have groups coming to ABC, the wide range of groups — from environmental groups to fishing groups to boating groups and all of the different groups within boating from manufacturers, dealers, representatives, distributors, marinas, boatyards, everybody coming and talking on the Hill — it’s important for these guys to do that.

I hear it, too, from dealers who don’t want to spend the money or time, or marinas are starting to put boats in the water and the yards are busy getting them cleaned up. It’s a time when the boat shows are just completing and this is their big selling time of the year. They don’t want to leave their businesses.

I understand all those things, but it’s important that they get involved and come, and write letters or send an email, listen to what we have to say about how this stuff can affect their business, and they can be a voice. One voice may not be so loud, but many voices are heard.

This article originally appeared in the May 2014 issue.

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