Evonne Agnello Pacific Northwest Newspaper Association	A. L. (Butch) Alford, Jr. Lewiston Morning Tribune Lewiston, ID	Alton F. Baker III The Register-Guard Eugene, OR
Chris Bennett The Medium Seattle, WA	Debbie Berto Issaquah Press Issaquah, WA	Rob Bickler Yakima Herald-Republic Yakima, WA
Jerry Brady Post Register Idaho Falls, ID	Scott Campbell The Columbian Vancouver, WA	Betsy Cowles Cowles Publishing Co. Spokane, WA
Wm. Stacey Cowles The Spokesman-Review Spokane, WA	Randy Frisch The Salt Lake Tribune Salt Lake City, UT	Stephen Hartgen The Times-News Twin Falls, ID
Peter Hovitz Eastside Journal Bellevue, WA	Bill Howard Howard Publications Seattle, WA	Don Kramer Kramer Publications Casa Grande, AZ
David Lord Pioneer Newspapers Seattle, WA	Brown Maloney The Sequim Gazette Sequim, WA	Elizabeth McCool The Bulletin Bend, OR
Thad Poulson Daily Sitka Sentinel Sitka, AK	Mike Sexton Anchorage Daily News Anchorage, AK	Michael Shepared Walla Walla Union-Bulletin Walla Walla, WA
Ronald Stewart The News-Review Roseburg, OR	Stewar Rowland Thompson Allied Daily Newspapers of Washington	John Walker Herald and News Klamath Falls, OR
Dennis Waller The Chronicle Centralia, WA	Lew Williams, III Ketchikan Daily News Ketchikan, AK	Sam Wolgemuth Freedom Communications, Inc. Irvine, CA
L. Stedem Wood Skagit Valley Herald Mt. Vernon, WA	Rufus Woods The Wenatchee World Wenatchee, WA

cc:

Alejandro Aguirre Diario Las Americas Miami, FL	Chris Anderson Orange County Register Santa Ana, CA	Bill Block, Jr. Blade Communications Toledo, OH
Paul Boyle Newspaper Association of America	Chuck Cochrane Yakima Herald-Republic Yakima, WA	Edwin Heminger The Courier Findlay, OH
Diana Kramer Washington Newspaper Publishers Association	Dorthy Leavell Chicago Crusader Chicago, IL	Virginia Moorehouse The Bakersfield Californian Bakersfield, CA
William S. Morris, III Morris Communications Augusta, GA	Max Paxton The News-Gazette Lexington, VA	Gary B. Pruitt The Sacramento Bee Sacramento, CA
Russ & Myrta Pulliam Indianapolis Newspapers, Inc. Indianapolis, IN	Alexis Scott Atlanta Daily World Atlanta, GA	Louis (Chip) Weil Central Newspapers, Inc. Phoenix, AZ

Death Tax Newsletter
This bi-monthly newsletter is produced by The Seattle Times for family-owned newspapers. Please share it with other family businesses in other industries. Any suggestions for distribution or content will be greatly appreciated. Contact Jill Mackie, Director of External Affairs, at 206-464-2028.

DEATH TAX REPEAL (H.R. 8) A REAL POSSIBILITY NOW!!!!

With +70% of the American public favorable, huge budget surpluses and historic votes in the House and Senate, we are on the verge of repeal. To succeed, we must convince the president not to veto H.R. 8 or try to negotiate a compromise. Now is the time for your action! Focus on the White House and your congressional delegation Ü especially Democrats. The more calls, letters and contacts, the better.

Key Points:

(1) This is a bi-partisan issue.

(2) It is incredibly popular with the public (+70% favorable).

(3) Veto or ineffective compromise proposals will hut Democrats in this fallÍs elections.

(4) H.R. 8 contains the provision sought by Senate Democrats Ü elimination of the stepped-up basis in capital gains.

(5) The administrationÍs proposal for "significant relief" is specious (see below for more detail).

(6) Repeal is about jobs.

(7) Repeal is about preserving family-owned, minority-owned and female-owned businesses.

(8) Repeal will stimulate the economy and actually increase federal tax revenue.

(9) Repeal will be a significant step towards reversing the "consolidation" trend in many industries and, conversely, preserving locally-owned businesses.

SENATE PASSES DEATH TAX REPEAL

In a show of remarkable support, the U.S. Senate voted on July 14 to approve H.R. 8, The Death Tax Elimination Act, 59-39. Nine Democrats (Breaux Ü LA, Cleland Ü GA, Feinstein Ü CA, Landrieu Ü LA, Lincoln Ü AR, Murray Ü WA, Robb Ü VA, Torricelli Ü NJ, Wyden Ü OR) voted to repeal the Death Tax. Thank you letters, particularly to the nine Democrats who supported repeal, are very important at this time. Also, special thanks are in order to Senator Jon Kyl, R-AZ, who championed the legislation in the Senate.

REPEAL BILL LIKELY TO BE SENT TO PRESIDENT JUST BEFORE LABOR DAY Ü CONTACTS TO WHITE HOUSE NEEDED

While President Clinton has indicated his intention to veto H.R. 8, it is critical that he hear from citizens regarding the terrible effects of this tax and the enormous difference repeal would make to family businesses all across America and to the economy. Congressional leadership has indicated that while no final decisions have been made, they are leaning toward sending the bill to the president shortly after the August recess. Both Senate Majority Leader Lott, and Boston Globe columnist Ellen Goodman indicated that public support for this legislation is overwhelming.

DEMOCRATIC SUBSTITUTES INEFFECTIVE

In attempts to slow down the Death Tax repeal momentum, Democratic substitutes were offered both in the Senate and in the House. This so-called "significant relief" provides only minor relief, to no help at all, depending on the make-up of the individual business. While the idea of a compromise often sounds reasonable, it is critical not to be beguiled by schemes that do not allow the transfer of a family business intact from one generation to the next. Legislative provisions that require continued extensive and complicated tax planning and cost prohibitive life insurance are not acceptable.

The major components of the ineffective substitutes are:

• Increase in the unified credit Ü this very modestly increases the amount of any estate exempt from the tax. But for businesses of any size or substance, this is not at all helpful. When did any of us last hear of a daily newspaper selling for less than $30-$50 million!! The so-called credit is a fraction of real small business values.


• Expanded family business carve out language Ü so-called "carve out" language already exists. The president proposes to expand the existing language. The problem is that ALMOST NO BUSINESSES QUALIFY now, or will under any expanded language! So expanding the benefits will be of no use in saving 97% of family-owned businesses, and itÍs impossible to define for tax purposes a multi-generational family business.



• Minor rate reduction Ü some Democratic proposals include minor rate reduction Ü generally around 10% off the top 55% rate. They argue that to do more benefits only the richest of the rich. And they falsely contend that since most businesses are taken care of by the family business carve out described above, substantial rate reduction is unnecessary. A family business worth $20 million, whose top tax rate was reduced to 45%, still faces an obscene burden. It is critical that those negatively effected by this terrible tax remember that the generally accepted criteria for a "good tax" is simplicity, fairness and economic impact. The death tax is fundamentally a bad tax and the momentum exists to kill it for good. WE SHOULD NOT SETTLE FOR COMPROMISES THAT DO NOT SOLVE THE PROBLEM.


MINORITY GROUP SUPPORT OF DEATH TAX REPEAL

Critical to winning support of many Democrats has been the endorsement of several significant minority groups. Those who have affirmatively indicated their support for repeal of the Death Tax include:

• National Association of Women Business Owners


• National Black Chamber of Commerce


• Texas Conference of Black Mayors


• National Indian Business Association


• The National Congress of American Indians


• U.S. Hispanic Chamber of Commerce


• Hispanic Business Roundtable


• U.S. Pan Asian American Chamber of Commerce


• National Association of Neighborhoods


DEATH TAX REPEAL ADS AVAILABLE ON DEATHTAX.COM

Beginning the week of August 7, Death Tax repeal ads will be available to be downloaded from www.deathtax.com. The ads, available in quarter, half and full page formats, can be run with a sponsorship logo of the newspaper running the ad, or attribution can be directed to the Family Business Estate Tax Coalition, a broad coalition of national associations supporting repeal. For additional information, please contact Jill Mackie at 206/464-2028 or Paul Boyle at 202/638-4784.

MORE INFO

See www.deathtax.com or call Jill Mackie at The Seattle Times or Paul Boyle at NAA.

Web site - www.deathtax.com

Did You Know?

The death tax brings in less than 1.1 percent of total federal revenues.

And, it is estimated it costs the government 65 cents of every dollar raised for enforcement and compliance.

The death tax is a jobs issue.

Repeal of the tax would result in 145,000 new jobs over the first 9 years of repeal.

And that doesn’t include the countless jobs that would be saved if the death tax didn’t force 70% of family and small businesses to liquidate or sell out after only one generation.

99% of all private businesses have fewer than 500 employees. This represents 50% of all private sector jobs which generate 50% of all revenue.

77% of the American voters polled by the 60 Plus Association indicated that they would be "more likely" to vote for their member of Congress if he or she voted to eliminate the death tax.