Webinar: Thriving People + Planet — Confronting Threats to the Outdoors

Speakers:
Lise Aangeenbrug – Executive Director, Outdoor Industry Association
Representative Joe Neguse (D-CO-02) – Chairman of the House Natural Resources Committee’s Subcommittee on National Parks, Forests, and Public Lands

Key Takeaways:

1. For the outdoors to thrive, it must be open and accessible to all.

2. The American Jobs Plan is a historic opportunity to make a difference on climate – now is the time for the outdoor industry to step up and urge Congress to act.

3. A Civilian Climate Corps will provide jobs and economic growth AND combat climate change and conserve green spaces for generations to come.

4. As outdoor climate policy priorities take center stage, your business voice matters.

A Washington Town Hall on Trade for Outdoor Companies

When: Wednesday, May 5

OIA Director of Government Affairs Rich Harper will lead a discussion with OIA’s outside trade counsels, Ron Sorini and Andrew Samet, on the wide range of issues that impact global supply chains of critical importance to outdoor companies. Sorini, Samet & Associates has represented OIA for over 15 years, helping our membership navigate a myriad of issues, from punitive tariffs on products sourced from China to securing duty-free treatment for travel goods in the Generalized System of Preferences (GSP).

These are among the topics that Rich, Ron and Andrew will discuss:

  • China tariffs: how long they might continue and prospects for a new exclusion process
  • What the focus in Washington on forced labor means for the industry
  • Implications of the Biden administration’s Build Back Better plan for the industry
  • Shipping challenges for outdoor companies
  • The prospects for new tariffs or free trade stemming from the Section 301 investigations with Vietnam
  • The future of critical trade programs such as GSP and miscellaneous tariff bills (MTBs)
  • Your questions

Webinar: ​​​​​​2021 E-Commerce Growth in China for the North American Outdoor Industry

Speakers: Joseph Cooke, President and Co-founder of WPIC Marketing + Technologies; Todd Embley, Host and Executive Producer of The Negotiation podcast

Is growing your brand in the world’s largest online market on your organization’s trajectory for the next year? As the world emerges from the COVID pandemic, do you see opportunity for market growth across Greater China in the next year?

Join WPIC, a leading APAC e-commerce consultancy, for an exclusive webinar, discussing how outdoor industry brands from across North America can succeed in the Chinese market in 2021.

Whether your organization is in the market, is actively looking to launch in China in 2021 or is interested in learning more about the mechanics of a market entry, this webinar will feature insights across a variety of topics, including the following:

  • What sort of growth the outdoor industry can expect in 2021 and beyond
  • Which tactics drive growth in the market today
  • What are the first steps to successfully enter the market and what sort of results can a brand expect in its first year?
  • How will the 2022 Beijing Winter Olympics affect consumer behavior?
  • How can North American brands solve challenges around logistics and capital expatriation?
  • What sort of data can be leveraged to drive decisions?

Webinar: 2021 Threats to the West and the Best Policies to Address Them

Speakers: Dave Metz, Partner and President, FM3 Research
Lori Weigel, Principal, New Bridge Strategy

The 11th annual Conservation in the West survey sponsored by Colorado College’s State of the Rockies Project is the most comprehensive view of Western-state voters’ attitudes about conservation issues and challenges. In years past, the survey has focused on issues such as state control of public lands, water rights and wildfire. The 2021 survey has a heavy focus on climate change and how lands and waters can affect that crisis. Our panel of pollsters will highlight findings from this year’s report, key distinctions among different racial/ethnic sub-groups within this region and how current or future federal and state policies can address conservation issues.

A NEW BEGINNING? OPPORTUNITIES AND CHALLENGES FOR OUTDOOR PRODUCTS AND GLOBAL SUPPLY CHAINS IN 2021A NEW BEGINNING? OPPORTUNITIES AND CHALLENGES FOR OUTDOOR PRODUCTS AND GLOBAL SUPPLY CHAINS IN 2021

Moderator: Rich Harper; Outdoor Industry Association

Presenters: Sara Bowersox, Senior Manager of Global Trade Compliance, OIATAC Vice Chair, Keen; Ben Christensen, VP of Operations, OIATAC Chair, Simms Fishing Products; Brent Meriam, COO, NEMO Equipment; Loren VandenBerghe, Director Global Logistics, REI; Emily Vedaa, Senior Manager, Global Customs & Trade, Columbia Sportswear

Description: Over the past few years, outdoor companies, from importers to domestic manufacturers alike, have had to deal with a series of threats to their supply chains, from steel and aluminum tariffs and the US-China trade war, to the covid-19 pandemic and the uncertainty of what may come next. With a new administration and Congress, outdoor companies look to turn the corner and take advantage of a surge in interest in outdoor recreation by doing what they do best: develop and bring to market innovative outdoor apparel, footwear and equipment to enhance the outdoor experience. Join us for an informative discussion with representatives from several outdoor companies on how they have dealt with multiple disruptions to their businesses and supply chains and where they see opportunities for growth in 2021 and beyond.

An Interior Secretary the American People Deserve

Outdoor recreation is a cornerstone of American life that relies on the health and wellbeing of the environment. Widespread access to public lands and waters is critical to maintaining and expanding the many benefits of outdoor recreation. As more and more Americans find refuge outdoors during the COVID-19 pandemic, recreation can be a big piece of the economic recovery puzzle.

Americans of all ages and the outdoor industry keenly understand this – as does President Biden’s nominee for Secretary of the Interior, Debra Haaland. With her stellar track record on public lands and waters, climate change, and environmental justice, the Senate would do well to swiftly confirm her nomination.

Secretary-designate Haaland will marry outdoor policy with this potential for economic growth. Throughout her career and during her time in Congress, she has demonstrated a sharp understanding of the impact of the $788 billion outdoor recreation economy and the benefit it has to communities. She led the charge on the Simplifying Outdoor Access for Recreation (SOAR) Act, a bill to cut bureaucratic red tape that prevents Americans from accessing outdoor spaces. She also supported the historic and broadly bipartisan Great American Outdoors Act (GAOA) last session, which provided much-needed funding for public lands and waters. In talking about this bill, she highlighted the close connection between environmental policy and economic recovery, saying “spending time outdoors…creates jobs in the outdoor recreation and restoration economies, but without proper federal funding, the parks, rodeo grounds, and National Parks…are vulnerable, as are the jobs that go along with them.”

In addition to increasing access to public spaces, the conservation and protection of the outdoors is of critical importance. 30×30 – the goal of conserving 30 percent of our lands and oceans by 2030 – is a top policy priority for the outdoor industry and for Haaland, too. As an industry that works closely with the Department of the Interior, it’s encouraging to see that she understands the massive opportunity to fight climate change and protect access, all while conserving public lands and waters. The outdoor industry will gladly work with her agency to develop a cohesive public and private sector action plan.

Addressing climate change is also a top priority for the entire outdoor industry. Businesses that operate in outdoor recreation have been feeling the impact of climate change for years and intimately understand the need for an aggressive, coordinated effort to address the crisis. With Deb Haaland at the helm of Interior, we believe progress can be made while leveraging the outdoor recreation economy as one part of the solution to support the traditional energy communities that will be affected by these changes. In her time in the House of Representatives, she cosponsored the Ocean Based Climate Solutions Act and introduced the Climate Stewardship Act, both of which worked to mitigate climate change by promoting natural climate solutions to keep the planet healthy. She also promised to “continue to push for natural climate solutions” going forward.

To effectively address the growing threat from climate change and protect the environment, we need everyone from Democrats and Republicans in Congress to Fortune 500 companies to park rangers to work together. Secretary-designate Haaland has a history of working across the aisle – she’s gotten more Republicans to sign on to her bills than any other Democrat in the House of Representatives. Her proven willingness to work in a bipartisan manner will be a boon for the outdoors, which after all are enjoyed by Americans from all backgrounds and walks of life.

The American people deserve an Interior Secretary that will fight for all of us. From conservation to economic recovery to climate change, Deb Haaland understands the broad impacts of decisions made by the Department of the Interior. For the good of the environment, the economy, and the people, the Senate should quickly vote to confirm her so she can get to work.

COVID-19 Stimulus Package Highlights

The following provisions are related to small businesses and access to Paycheck Protection Program (PPP) second draw loans. For additional information on obtaining PPP loans, view OIA’s webinar from March 2020 with Small Business Administration.

Additional expenses are now allowable and forgivable with PPP funds:

  • Covered worker protection expenditure. PPE and adaptive investments to help a loan recipient comply with federal health and safety guidelines or any equivalent state and local guidance related to COVID-19 during the period between March 1, 2020, and the end of the national emergency declaration.
  • Covered property damage costs. Costs related to property damage due to public disturbances that occurred during 2020 that are not covered by insurance.
  • Covered supplier costs. Expenditures to a supplier pursuant to a contract, purchase order, or order for goods in effect prior to taking out the loan that are essential to the recipient’s operations at the time at which the expenditure was made. Supplier costs of perishable goods can be made before or during the life of the loan.
  • Covered operations expenditures. Payment for any software, cloud computing, and other human resources and accounting needs.
  • These forgiven loans will not be counted as taxable income.

Specific Group Insurance Payments as Payroll costs:

  • Clarifies that other employer-provided group insurance benefits are included in payroll costs. This includes group, life, disability vision and dental insurance.
  • This provision applies to loans made before, on, or after 12/22/2020 (enactment date), including forgiveness of the loan.

PPP Second Draw Loans:

  • This “PPP second draw” loan will be for smaller and harder-hit business, with a maximum amount of $2 million.
  • To be eligible to receive a PPP loan, you must:
    • Have fewer than 300 employees
    • Have used (or will use) the full amount of your first PPP loan
    • Demonstrate at least a 25% reduction in gross receipts in the first, second, or 3rd quarter of 2020 relative to the same 2019 quarter.
  • Eligible entities must be a business, certain non-profit organizations, self-employed individuals, sole proprietors, independent contractors and small agricultural co-operatives
  • Loan terms:
    • Seasonal employers may calculate their maximum loan amount based on a 12-week period beginning February 15, 2019 through February 15, 2020
    • New entities may receive loans of up to 2.5x the sum of their average monthly payroll costs
    • Businesses with multiple locations that are eligible entitles under the initial PPP requirements may employ not more than 300 employees per physical location
    • Wavier of affiliation rules that applied during initial PP loans apply to a second loan
    • An eligible entity may only receive one PPP second draw loan
  • Loan forgiveness: borrowers of a PPP second draw loan would be eligible for loan forgiveness equal to the sum of their payroll costs, as well as covered mortgage, rent, and utility payments, covered operations expenditures, covered property damage costs, covered supplier costs, and covered worker protection expenditures inured during the covered period. The 60/40 cost allocation between payroll and non-payroll costs in order to receive full forgiveness will continue to apply.
  • Guidance to prioritize underserved communities: directs the SBA Administrator to issue guidance addressing barriers to access to capital for underserved communities no later than 10 days after enactment
  • Application of Exemption Based on Employee: extends existing safe harbors on restoring full time employees (FTE) and salaries and wages.
    • Specifically, applies the rule of reducing loan forgiveness for the borrower reducing the number of employees retained and reducing employees’ salaries in excess of 25 percent.

Increased Ability for PPP Borrowers to Request an Increase in Loan Amount due to Updated Regulations:

  • Requires SBA to release guidance to lenders withing 17 days of enactment that allows borrowers who returned all or part of their PPP loan to reapply for the maximum amount applicable so long that they have not received forgiveness
  • This section allows borrowers whose loan calculations have increased due to changes in interim final rules to work with lenders to modify their loan value regardless of whether the loan has been fully disbursed, or if Form 1502 has already been submitted

Eligibility of 501(c)(6) and Destination Marketing Organizations for Loans Under PPP:

  • Expands eligibility to receive a PPP loan to include the following organizations –
    • 501(c)(6) if:
      • The organization does not receive more than 15 percent of receipts from lobbying
      • The lobbying activities do not exceed $1 million during the most recent tax year that ended prior to February 15, 2020
      • The organization has fewer than 300 employees
      • Professional sports leagues or organizations with the purpose of promoting or participating in a political campaign or other political activities are not eligible under this section
    • Destination Marketing Operations if:
      • Sections 1-3 above, and
      • The destination marketing organization is registered as a 501(c) organization, a quasi-government entity, or a political subdivision of a state or local government

      Prohibition on use of Loan Proceeds for Lobbying Activities:

      • Proceeds of the covered loan may not be used for lobbying activities, as defined by the Lobbying Disclosure Act, lobbying expenditures related to state or local campaigns, and expenditures to influence the enactment of legislation, appropriations, or regulations

      Limitations on Eligibility:

      • Businesses or organizations that were not in operation on February 15, 2020 are not eligible for a second draw PPP loan
      • This was the case for initial PPP loan
      • Eligible entities that receive a grant under the Shuttered Venue Operator Grants will not be eligible for a PPP second draw loan

      Direct Appropriations:

      • $284.45 billion for PPP, including:
        • $35 billion for first-time borrowers
        • $25 billion for second draw PPP loans
        • $15 billion for PPP loans issued by community financial institutions
        • $15 billion for PPP loans issued by certain small depository institutions
      • $15 million for the Minority Business Development Centers program
      • $50 million for PPP auditing and fraud mitigation
      • $3.5 million for Debt Relief program

New ban on products made with forced labor in Xinjiang, China

The Trump administration announced last week that it would ban all inbound shipments containing cotton or any cotton products – including textiles and apparel – originating from the Xinjiang Production and Construction Corps (XPCC) due to forced labor and human rights concerns.

The XPCC is a paramilitary organization that is responsible for most of the cotton production and harvest in the Xinjiang Uighur Autonomous Region (“XUAR”) of China. The U.S. Department of Agriculture estimates that XUAR’s cotton harvest accounts for more than 80 percent of China’s overall cotton production.

This action is the latest in the administration’s effort to combat forced labor and other human rights violations in the Xinjiang region, home to China’s Muslim Uyghur community.

In September of 2020, the U.S. Customs and Border Protection (CBP) announced it would detain imports suspected of being made with forced labor from the following entities in XUAR:

  • Xinjiang Junggar Cotton and Linen Co. and its subsidiaries – Cotton
  • Hefei Bitland Information Technology Co. – Computer parts
  • Yili Zhuowan Garment Manufacturing Co. – Apparel products
  • Baoding LYSZD Trade and Business Co. – Apparel products
  • Lop County No. 4 Vocational Skills Education and Training Center – All products
  • Lop County Hair Product Industrial Park – Hair products

In July of 2020, the administration listed the XPCC as a specially designated national (SDN) under U.S. sanctions laws enforced by the Office of Foreign Asset Controls (OFAC) by the Treasury Department; this bars all transactions that benefit the XPCC or its subsidiaries and affiliates with a 50-percent-or-greater controlling share by XPCC. The Commerce Department has also placed companies connected to the Xinjiang region on its Entity List subject to technology export controls.

In addition, the Senate may consider the House-passed Uighur Forced Labor Prevention Act (H.R.6210/S.3471) before the end of the year. As currently drafted, the bill includes the following provisions:

  • A requirement for the administration to develop an action plan to address forced labor in the XUAR.
  • A prohibition starting 120 days after enactment of the importation of all goods produced, in whole or in part, in the XUAR, based on a presumptive link to forced labor – unless the importer can provide clear evidence to the contrary.
  • A requirement that SEC-reporting companies include new disclosures about any nexus to the XUAR.

It is possible that the bill’s provisions could be amended before a final vote in the Senate. We will keep you posted on any developments.

To learn more about this important issue and the impact on outdoor companies, check out this OIA webinar from September.

FAQ: 2020 BUREAU OF ECONOMIC ANALYSIS REPORT ON OUTDOOR RECREATION RELEASED

Outdoor Recreation Is an Economic Force; Accounts for Over 2 Percent of U.S. Gross Domestic Product

November 20, 2020

How is the Bureau of Economic Analysis (BEA) study different from the OIA economic study?
The featured BEA measures include gross output, a measure of outdoor recreation goods and services produced by domestic industries; and value added, a measure of the contribution of outdoor recreation industries to gross domestic product (the primary measure of economic activity in the nation). OIA’s study measures consumer spending on all gear-related expenses and associated travel for outdoor recreation, including spending on imported products.

How does the $842B nominal gross output ($788B real gross output*) contribution line up with the OIA’s $887 billion consumer spending on outdoor recreation?
Both are true, they just measure different economic contributors. The BEA satellite account measures gross output while OIA’s study measures consumer spending on all gear-related expenses and associated travel for outdoor recreation.

It is important to note; the BEA estimate only includes the wholesale and retail mark-ups applied to imported products while the OIA’s figures report all consumer spending.

* Current-dollar estimates are valued in the prices of the period when the transactions occurred—that is, at “market value.” Also referred to as “nominal estimates” or as “current-price estimates.” Chained-dollar (Real) estimates are calculated by taking the current-dollar level of a series in the base period and multiplying it by the change in the chained-type quantity index number for the series since the base period. Chained dollar estimates correctly show growth rates for a series but are not additive in periods other than the base period.

What is the methodology of the OIA Outdoor Recreation Economy Report?
BEA’s analysis for the time period 2012-2019 was just released on November 10. We have not had an opportunity to review the methodology at this point, but what we do know is that our economic report is based on consumer spending, while the BEA’s numbers are focused on measuring gross output and value added.

Essentially, our economic report – which is basic economic input-output modeling – starts with the consumer and works down to the manufacturing/imports point. The BEA goes the opposite direction, starting with production in manufacturing and other industries and works up to the consumer. This approach uses different data sets and methods which accounts for differences, too.

What is the difference between gross output and value added (or GDP)?
Gross output (GO) is the measure of total economic activity in the production of goods and services. It is a much broader measure of the economy than gross domestic product (GDP), which measures final output (finished goods and services).

Election 2020 Outcome Outlook

This article was published Thursday, Nov. 5. For updates as of Nov. 10 and a deeper dive into these insights, watch our Post-Election Analysis webinar.

At the time of publication, the Associated Press has declared a presidential victor in all but a handful of states, leaving pivotal Georgia, Nevada, North Carolina and Pennsylvania up in the air. A few key Senate seats, including two in Georgia and one in North Carolina and more than 30 House seats, are also too close to call. But with help from our D.C.-based consultants at Forbes Tate Partners, we’ve gamed out the various potential scenarios to explore what the White House and Congress could look like, who are likely to be key players on our issues, what can we expect between now and inauguration and how the outcomes might influence our work moving forward.

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The House of Representatives

Democrats Poised to Hold the House, But Republicans Gain More Seats Than Expected

What Does This Mean: Democrats will retain control of the House but fell well short of expectations to pick up between 10 and 15 seats. In fact, Republicans may still gain some seats, narrowing the Democratic majority. While we believe the House will remain active on climate issues in the new Congress, it’s possible that, combined with Republicans likely retaining the Senate, Democrats might temper their ambitions when it comes to putting together a climate package. Likewise, while we could see additional protections for public lands and waters, Speaker Nancy Pelosi (D-CA) will have to be mindful of what she brings to the floor given her possible reduced majority. On trade, the House will likely continue to prioritize labor and environmental protections in any trade deals, as well as—for the first time—binding climate provisions.

While we believe the House will remain active on climate issues in the new Congress, it’s possible that, combined with Republicans likely retaining the Senate, Democrats might temper their ambitions when it comes to putting together a climate package. Likewise, while we could see additional protections for public lands and waters, Speaker Nancy Pelosi (D-CA) will have to be mindful of what she brings to the floor given her possible reduced majority.

The Senate

Republicans Likely to Hold Senate

What Does This Mean: While control of the Senate is still officially undecided, it is likely that Republicans will retain control. One or both of the Senate races in Georgia could go to a run-off in January, and the Republican candidate would be favored in both races. Democrats picked up seats previously held by Republicans in Arizona and Colorado, while Republicans flipped Alabama. As we saw with the Great American Outdoors Act, we could still see movement on recreation and conservation issues with a Republican Senate, though it will be tougher to pass more robust climate initiatives. Passage of the United States-Mexico-Canada Agreement (USMCA) suggests that a Democratic House and Republican Senate could work together on international trade issues.

As we saw with the Great American Outdoors Act, we could still see movement on recreation conservation issues with a Republican Senate, though it will be tougher to pass more robust climate initiatives. Passage of the United States-Mexico-Canada Agreement (USMCA) suggests that a Democratic House and Republican Senate could work together on international trade issues.

The White House:

Biden Has a Clearer Path to Victory

What Does This Mean:  While the race has not yet been officially called (though that could happen as soon as today), indications are that Biden will win the presidency by successfully flipping Arizona, Wisconsin, Michigan and Pennsylvania. Aggressive action on climate will remain a top priority for his administration, but if Republicans maintain control of the Senate, Democrats will likely set aside more ambitious plans. The Great American Outdoors Act shows how Republicans and Democrats can work together on conservation issues and additional public lands and waters protections. On trade, Biden will prioritize “Made in America” and a more multilateral approach to trade disputes, relying on dialogue and negotiation rather than punitive tariffs. That being said, China Section 301 tariffs are likely to remain for the foreseeable future. Biden and the Democratic House will push Senate Republicans on strong labor and environmental and climate provisions in any new trade deals, using USMCA as a model.

 

The Cabinet

New Faces Likely, Whoever Wins

What Does This Mean: Obviously, with a Biden presidency, we will see new leadership at Interior, Commerce, the Office of the United States Trade Representative and other agencies, with dramatically different priorities on issues affecting the outdoors and the outdoor industry. Should Biden win, his nominees for those positions will be released over the next several weeks. With a Republican-controlled Senate, he may be compelled to send over more moderate nominees.

The Key Committees and Chairs

Republicans have term limits on their chairs. Democrats do not, and they appoint committee chairs and ranking members based on seniority.

House Natural Resources

  • Raul Grijalva (D-AZ) retains the chairmanship.
  • OIA will have a great opportunity to work with Chairman Grijalva on conservation, streamlining the permitting process, promoting diversity in the outdoors, implementing the Great American Outdoors Act and combating climate change.

House Ways & Means

  • Richard Neal (D-MA) will remain chairman.
  • OIA anticipates that one of our key outdoor champions, Earl Blumenauer (D-OR), will continue as chair of the trade subcommittee and work with us on our balanced trade agenda.

Senate Energy & Natural Resources

  • Senator John Barrasso (R-WY) will likely take over from Senator Lisa Murkowski (R-AK) who is term-limited. Senator Joe Manchin (D-WV) is ranking member.
  • The outdoor community worked closely with Senator Manchin on passing the Great American Outdoors Act. Senator Barrasso helped lead the effort to pass America’s Conservation Enhancement Act.

Senate Environment & Public Works

  • Senator Shelley Moore Capito (R-WV) is the likely incoming chair, with Senator Barrasso (R-WY) moving over to Energy and Natural Resources.
  • Senator Tom Carper (D-DE) a longtime friend of the industry on climate and public lands and is ranking member.

Senate Finance

  • If Republicans maintain control, the gavel could pass to Senator Mike Crapo (R-ID), as the current chair, Senator Chuck Grassley (R-IA), is term-limited. Senator Ron Wyden (D-OR) will continue as ranking member.
  • Senator Wyden is a longtime supporter of the outdoor industry and has led several initiatives in the past consistent with our balanced trade agenda, including the U.S. OUTDOOR Act. Senator Crapo, in fact, was also a lead sponsor of the OUTDOOR Act and worked closely with outdoor companies on miscellaneous tariff bills and the Generalized System of Preferences (GSP).

Prospects for a Lame Duck

We have seen early signals that Senate Majority Leader Mitch McConnell (R-KY) and Speaker Pelosi will push for a Covid-relief package in the lame duck session, in addition to an omnibus spending bill to keep the government open through the end of the fiscal year. It is unclear, however, if an outgoing President Trump will have any interest in working with congressional leadership on either issue. It is possible that Congress could pass a short-term spending bill and consider the broader spending bill and Covid relief when the new Congress is sworn in in January.