-by John McCue
Classified Ads--- Sales Manager
Sales Manager: Atlanta, GA
30 years in transportation Finance with strong management/ sales background. Represented company on national & region markets. Started two successful operations- produce profits and growth. Email:firstname.lastname@example.org
Sales Manager: Dallas/Fort Worth, TX.
Domestic-int'l exp. Small to middle ticket. 24 yrs with Fortune 500 firms(2). Consistently achieves margin/ volume goals. Email: email@example.com
Sales Manager: New York, NY
I have over 25 years owning an independent leasing company that specialized in truck leasing. Tow trucks, Limos, ambulances, tractors, etc.. Email:firstname.lastname@example.org
Sales Manager: Pennsauken, NJ.
17 Years Leasing in all capacities from CSR and Collections to National Sales Management and Vice President Vendor Development. Exceptional People Skills. Many industry references. email: email@example.com
Sales Manager: Portland, OR. 18+ yrs w/bank leasing company. Supervised 14- 20 sales people. Willing to relocate for the proper position. Email:firstname.lastname@example.org
Sales Manager: Seattle, WA
Senior level sales professional w/ (20) plus experience in mid market financing & leasing. The last (8) plus years being self employed in middle market brokerage. Email:email@example.com
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Economic Events This Week
Balance of Trade: January
Retail Sales: February
Weekly Jobless Claims
Inventory-Sales Ratio Jan.
Time To Pull Together
President, McCue Systems Inc.
As one who has been around the equipment leasing industry for over 30 years, I've been dismayed at the recent shellacking our business has been taking in the mind of the public, particularly in the way it was portrayed in the recent PBS special, "Tax Me If You Can". While some of what was reported may have been valid, the overall tone of the piece for equipment leasing was gravely unfair.
I think it's time for those of us who care about this industry to speak up and make sure that the truth of what we contribute to the overall health of this economy is told!
I salute Michael Fleming for having the courage to "get out there" and face the lions! His recent press conference was an act of courage and helped to redress the balance. And I thank Mike and the ELA for their leadership role in this controversy and for showing that industry has created between $100-$300 billion to real GDP, $227 billion in new equipment manufacturing and 3-5 million jobs.
But all of us need to step forward and be counted. Especially given our recent experience. After all, the leasing industry has just survived one of its most difficult periods: in the face of shrinking volume (especially in big-ticket) and industry consolidation, we've had to deal with heightened scrutiny and regulatory restructuring, and bad business press.
Right now was not a good time for a nationally- broadcast special to take a handful of the most egregious cases of aggressively packaged products and suggest that they represent the form and substance of an entire industry.
Equipment leasing cannot be characterized by sham transactions and hidden ownerships that exploit the tax code and harm the average citizen. Granted, it is an election year and governments from state and municipal up to the Federal level are feeling the pinch from tight economic times and struggling to figure out how to make ends meet. It looks like they have found their convenient scapegoat…one singular place where they can squeeze 33 billion of tax dollars over the next 10 years (by their very questionable estimation).
We are partly to blame for putting ourselves in this position, as we have not done enough to make sure that our lawmakers and the public understand the workings and benefits of equipment leasing.
When I went to Capital Hill Day last year, I was amazed to see that the members of Congress had little understanding of the true flow of capital through our system and the significance of leveraging the value of capital available to businesses, municipalities, or non-profit entities that we make possible. We have allowed them to think of syndication as underhanded and designed to hide ownership, when in many cases it is simply dividing transactions down into manageable portions. The underwriting institution is performing a service as a kind of wholesaler and is not in the position to carry the entire block of paper for the entire duration of the transaction.
When policymakers think of these transactions as tax shelters, they think of "tax avoidance" when it is really "tax deferral". Because what is being changed is the timing of the taxation, as depreciation is taken in the early years to position the taxation of the income of transactions to later years.
We need to remind Congress that it was they who created these "shelters" in the first place. These transactions were intended to attract capital into markets where it would not have otherwise gone, either because the deals were too risky or did not provide sufficient yield. Tax sheltering, when reasonably applied, is and was a reasonable means to have highly taxable entities divert their funds at a lower interest rate than would otherwise be available to stimulate investment without having to use federal dollars in the form of grants, loans, or direct expenditures.
Yes, there may be abuses in the system that need to be reformed. And perhaps the zealous and creative among us have pursued an approach that generated an even higher volume of transactions than had originally been anticipated or budgeted for in the federal budget when the leasing guidelines were enacted. We need to address the abuses, and do so immediately.
I think it's time for all of us to pull together and become more self-policing. Let's agree which kinds of shelters are outside of the box so that we can define the parts of the box that are truly adding value. Although we as an industry may resist the codification of economic substance, a more effective strategy may be to focus on what would work for our industry and the economy …and to work pro-actively with those in Congress who are participating in the review of industry practices.
Thinking about which of these behaviors are defensible, I suggest that there are three areas that may cross over the line:
Offshore municipal deals that provide lower cost capital to foreign municipalities by subsidizing them (through tax savings) with US federal tax dollars. (At the same time, we can defend providing such support to US municipalities, with a resulting overall tax neutral outcome. (And all the more favorable if our transactions are actually purchasing some new equipment somewhere in the mix, thus creating some extra jobs.)
Sale and lease-back transactions that require over 65% defeasance (compensating balances) of the purchase value of equipment. To be a real transaction, it needs to free up more cash for the leasing entity than the tax shelter effect it generates.
Sales and leasebacks where an entity sells some of its used infrastructure are somewhat questionable. It is not generating the sale of new equipment, and in many cases is not exactly equipment (such as a 30 year old sewer system) as one would think of it that would go to anyone but the lessee at the end of the lease term.
It appears that the so-called SILO (Sale-in/ Lease-out) transactions that have come under question represent only a small portion of the industry volume yet are having an oversized impact on leasing's reputation. According to recent reports, the total is about $10-$15 billion and only half of these are offshore (about $6-7 billion) while perhaps another $3 billion are for either used infrastructure or require over 65% compensating balances. Thus, collectively it appears that the offending transactions may be only a total of $10 billion out of a $220 billion industry volume or about 5%.
We need to correct the general perception by Wall St, the public, and Congress by actively closing the most questionable of transactions while emphasizing the contribution to the economy of the remaining 95%.
Let's confront the problems, work to fix them, and start talking about what's RIGHT in equipment leasing. For openers, consider the many ways industry acts as an economic stimulant (and Lord knows we need an economic stimulant at this point). In the deals that are properly structured, we make capital equipment upgrades possible, and so create jobs for the user and the producer of the goods. We do this even better than lending can especially at a time where capital availability is scarce. Participation in the equipment ownership from someone (like the manufacturer) who has a vested interest in selling it is going to be necessary at the beginning of a general recovery where so many companies' credit ratings are compromised.
There is one thing that is important for all of us to reflect on at a time like this. Our public perception as an industry has been tarnished.
We, as an industry, must pull together with a unified voice ...and get back to the basics of communicating the value that the leasing industry brings to building a robust economy and growing investment in the capital goods that have made US industry and agriculture among the most productive on our planet.
This year, more than ever, we all need to stand behind ELA and Capital Hill Day and in local community business forums to get this message out, so that neither Congress nor the business public overreacts. They need to understand how to effectively partner with the leasing industry in the areas that need help, to stimulate domestic economic growth, building jobs and prosperity. With 95% of our transactions, we have a very strong story that shows that we contribute far, far more to GDP than any offsets or sheltering that comes with leasing transactions.
Streamline Sales Tax Project
The Equipment Leasing Association (ELA) has scheduled an informative web-based seminar examining technology that will implement Streamlined Sales Tax (SST). Scheduled from 1:30 – 3:00 pm Eastern Time on Thursday, April 8, the web seminar is designed for commercial equipment lessors but will have some applicability to other industries since the basic technology platform concerns all parties implementing the software-driven SST. Taxware will guide participants through a review of lease origination, accounting and tax software integration with certified automated systems and certified service provider systems considered critical for compliance with SST. To learn more about the agenda and to register, go here: http://www.elaonline.com/events/2004/SST/
The surprising success in gaining state enactments of the SST agreement has focused ELA attention on informing lessors of the technology intended to drive the system. This web based seminar is scheduled in anticipation of release of the Request For Proposal in 2004 to potential Certified Service Providers leading to certification that would allow a third party to calculate, collect, report and remit applicable state and local sales and use taxes on behalf of a retailer or lessor. Using their systems as a representative example of the SST platform, Taxware tax and technical representatives will explain how lessors will need to accommodate the transaction tax criteria established for the new software-based tax regime.
Discussion during the web seminar will focus on the linkage between the accounting systems used by industry and SST-mandated tax systems, including:
· What Is Streamlined Sales Tax and How Will it Change Your Operations?
· Will Your Lease Origination, Tax and Accounting Software Integration Meet System Criteria?
· Learn Streamlined Sales Tax Technology Options: Certified Service Providers and Certified Automated Systems
We invite you to participate this important event. To register and to learn more about the agenda, please go here: http://www.elaonline.com/events/2004/SST/
Equipment Leasing Association
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Cartoon---Industry Attitude Problem
### Press Release ###########################
The FDIC announces the sale of a $ 2.2 million performing lease portfolio from Southern Pacific Bank
The FDIC is selling the remaining $2.2 million performing lease portfolio of Southern Pacific Bank. The leases were originated by Southern Pacific BanCapital, a division of Southern Pacific Bank and consist of two performing lease agreements offered separately in two pools- one pool consists of lease loans secured by leased equipment; the second consists of direct finance leases.
A competitive bid sale will be conducted by the FDIC with electronic information being available on March 5, 2004. Hard copy due diligence will be conducted at the FDIC office in Dallas, TX from March 15 through April 2, 2004. The sealed bid deadline is scheduled for April 6th.
The lease pools are part of the FDIC’s quarterly offering of assets from failed banks. In addition to the lease pools, there are 16 additional pools of performing and non-performing SFR 1-4’s, commercial real estate and commercial loans.
For sales and registration information, visit the FDIC web site at www.fdicsales.com or contact Michael Hankinson, Resolutions and Receivership Specialist at firstname.lastname@example.org. or (972) 761-2420.
Sites of Reference:
Federal Deposit Insurance Corporation
Phone Number: 972-761-2420
Fax Number: 972-761-8241
### Press Release ###############################
Classified Ads---Help Wanted
Senior Sales Executive
Vendor Sales Manager
February hiring falls far short of predictions
Nearly all new positions created by government
Offshoring's giant target: the Bay Area
Silicon Valley could face export of 1 in 6 jobs -- worst in nation
Mortgage rates little changed; 30-year at 5.59%
Here's the deal: T.O. was not free despite his view to the contrary
This Day in American History
1717 - On Fishers Island in Long Island Sound, 1200 sheep were discovered to have been buried under a snow drift for four weeks. When finally uncovered, one hundred sheep were still alive.
1790—The first U.S. Census started this month and was completed on August 1. the population was placed at 3,929,625,including 697,624 sales and 59,557 free blacks. the most populous state was Virginia with 747,610 people, and the lagest city was Philadelphia, with a population of 42,444. The center of U.S. population was aboaut equally divided between New England and the Middle Atlantic States, and the South. Massachusetts was the only state to report no slaves.
1862- The Confederate ironclad Virginia destroyed two Union frigates at Hampton Roads, Va., whereupon the Virginia retired, leaving the Union blockade intact. The crew of the Monitor, following naval regulations, had been using only half charges in its two 12-inch guns.
1863--In a daring raid with his commando-style raiders, Colonel John Mosby captured Union General E.H. Stoughton from his headquarters in Fairfax County Courthouse in Virginia . Mosby’s irregular forces patrolled a northern area of Virginia that became known as Moshys Confederacy. Supported by the local populace and reviled by his Northern enemies, Mosby’s Rangers were one of the most successful of the Southern irregular forces.
1888- Susan B. Anthony appeared before the Judiciary Committee of the House of Representatives for four days, appealing for the woman’s right to vote. On June15,1919, the passed what they called the “Anthony Amendment” which the states ratified on August 26, 1920, giving women the right to vote in the United States. http://memory.loc.gov/ammem/today/mar08.html
1909 - The town of Brinkley AR was struck by a tornado which killed 49 persons and caused 600,000 dollars damage. The tornado, which was two-thirds of a mile in width, destroyed 860 buildings. Entire families were killed as houses were completely swept away by the tornado. Tornadoes killed 64 persons and injured 671 others in Dallas and Monroe counties during the Arkansas tornado outbreak.
1912—birthday of Louis Beavers. Her Hollywood careers spanned 30 years and more than 125 films. Though she was forced to play stereotypical roles, such as those of maids, her authentic talent was always apparent. Her starring role in the film Imitation of Life earned her high praise. Beavers was a member of the Black Filmmakers Hall of Fame. She also played the title role in the TV series ‘Beulah’ (1951—53). Born at Cincinnati, Ohio, died at Los Angeles, Oct 26, 1962.
1913- The Internal Revenue Service began to levy and collect income taxes. The 16th Amendment to the Constitution, ratified Feb 3,1913, gave Congress the authority to tax income. The US had also levied an income tax during the Civil War. President Abraham Lincoln signed into law a bill levying a 3 percent income tax on annual incomes of $600—$10,000, and 5 percent on incomes of more than $10,000. The revenues were to help pay for the Civil War. This tax law actually went into effect, unlike an earlier law passed August 5,1851, making it the first income tax levied by the US. It was rescinded in 1872.
1918-Arranger/tenor sax/trombone player/bank leader Sam Donahue Birthday http://www.hepjazz.com/bios/samdon.html
1922- Carl Furillo, baseball player born at Stony Creek Mills, PA. Furillo played right field for the Brooklyn Dodgers “Boys of Summer” teams of the late 1940’s and 1940’s. He compiled a .299 lifetime batting average and was known for his strong throwing arm, giving rise to his nickname, the “reading Rifle.” Died at Stony Creek Mills, Jan 21, 1989.
1925 - Bernard McFadden was a physical culturist who had a radio show in New York City. He failed to show up this day for his daily morning program, causing a young, studio engineer, John Gambling, to ad-lib on the air for a solid hour. As a result, the radio station (WOR) decided to give Gambling the morning announcer’s job. John Gambling stayed at WOR for many years, then turned the mike over to his son, who, finally, turned the program over to his son ... all named John. Mr. Gambling’s "Rambling with Gambling" program attracted tri-state (New York, New Jersey, Connecticut) audiences in record numbers for over 70 years on the 50,000 watt talk-radio powerhouse at 710 AM on your radio dial from New York each morning.
1935-Trumpet player Wingy Manone records, “ Isle of Capri.”
1935 -- Thomas Wolfe's second novel, Of Time and the River, is published to great acclaim.
1935-saxophone player George Coleman born Memphis TN
1936-guitarist Gabor Szabo born Budapest, Hungry. Died February 26, 1982
1940- Cab Calloway Band records “Diz’s Pickin’ the Cabbage,” perhaps the first Dizzy
Gillespie music recorded.
1948-1960s pop singer Little Peggy March, whose real name is Margaret Battavio, was born in Lansdale, Pennsylvania. She was heard singing at a cousin's wedding, and someone passed the word along to RCA Victor. She was only 15 when she recorded "I Will Follow Him," which topped the Billboard Hot 100 in the spring of 1963.
1951-Pianist James Williams born Memphis, TN
1954- the Milwaukee Hawks and the Baltimore Bullets played the only two-team doubleheader in NBA history. The Hawks won both games, 64-54 and 65-54.
Sincerely - McGuire Sisters
The Crazy Otto (Medley) - Johnny Maddox
The Ballad of Davy Crockett - Bill Hayes
In the Jailhouse Now - Webb Pierce
Walk like a Man - The 4 Seasons
Rhythm of the Rain - The Cascades
You’re the Reason I’m Living - Bobby Darin
The Ballad of Jed Clampett - Flatt & Scruggs
1964 -- Malcolm X announces split with Nation of Islam.
1965-The first U.S. combat forces in Vietnam, more than 3500 Marines, landed in South Vietnam to guard the U.S. Air Force base at Da Nang. They joined 23,500 other Americans serving as “advisers” in South Viet Nam. The United States began supplying Viet Nam with troops to fight the Japanese. In 1945, Lt. Col. A. Peter Dewey, head of American OSS mission, was killed by Vietminh troops while driving a jeep to the airport. Reports later indicated that his death was due to a case of mistaken identity -- he had been mistaken for a Frenchman. in 1945. After World War II, to stop communism, President Truman sent over military advisors. The first American to be killed was an OSS officer. In 1950, more aid was sent; $10 million dollars and 35 troops. Eisenhower continued this policy. During his term, Eisenhower will greatly increase U.S. military aid to the French in Vietnam to prevent a Communist victory. U.S. military advisors will continue to accompany American supplies sent to Vietnam. To justify America's financial commitment, Eisenhower will cite a 'Domino Theory' in which a Communist victory in Vietnam would result in surrounding countries falling one after another like a "falling row of dominoes." The Domino Theory will be used by a succession of Presidents and their advisors to justify ever-deepening U.S. involvement in Vietnam. Kennedy continued this policy. On December 21, 1961 that President Kennedy sent troops to Vietnam, actually 425 helicopter crewmen to provide support and training for South Vietnamese forces. It was not until Johnson had made promises to send in troops on his visit to Viet Nam. In 1961, during a tour of Asian countries, Vice President Lyndon Johnson visits Diem in Saigon. Johnson assures Diem that he is crucial to US objectives in Vietnam and calls him "the Churchill of Asia." It was he who was promoting a war to “stop communism.” He did not want to appear “soft. History shows the first ground troops sent to Vietnam were 3,500 Marines who landed at the port of Da Nang in South Viet Nam on March 8,1965, authorized by President Johnson. The Marine’s mission was to guard the air base there. They raised the total U.S. troop strength in Vietnam to 27,000. Eventually over 400,000 troops would be in Southeast Asia. It was Johnson’s war. It was the reason he did not seek a second term.
1968-Tommy Moore, 6 years old, made a hole-in-one at the Woodbrier Golf Course in Hagerstown, MD.
1968 -- Bill Graham, owner of the Fillmore, San Francisco's legendary rock ballroom, opens Fillmore East in New York City. Opening bill features Albert King, Tim Buckley & Big Brother & the Holding Company.
1968 -- Meanwhile, back in the Frisco Bay area, Cream, James Cotton
Blues Band, Jeremy Satyrs, & Blood Sweat & Tears at the Fillmore
Auditorium. Over to the Avalon Ballroom is Love, Congress of Wonders,
& Sons of Champlin.
1969 - Sly and the Family Stone began their fourth, and final, week at number one on the pop music charts with "Everyday People". When he was presented with the gold record for this achievement, Sly ripped it out of its case and played it, to hear, "People", by Barbra Streisand. He was heard to utter a few not printable words.
One Bad Apple - The Osmonds
Mama’s Pearl - The Jackson 5
Me and Bobby McGee - Janis Joplin
I’d Rather Love You - Charley Pride
1971- Joe Frazier won a 15-round unanimous decision over Muhammad Ali at New York’s Madison Square Garden to become the heavyweight champion of the world. For the night, both Frazier and Ali collected $2,500,000.
1971-a snowstorm dropped 10 to 20 inches of new snow across Vermont to raise snow depths to record levels. 116 inches was measured on the ground on top of Mount Mansfield, the second highest snow depth ever recorded on the mountain up to the time. The town of Orange measured 88 inches on the ground for a new state low elevation snow depth record.
1975 - Olivia Newton-John reached #1 on the pop charts with "Have You Never Been Mellow". Olivia also reached the top spot with "I Honestly Love You", "You’re the One That I Want" (with John Travolta), "Magic" and "Physical".
Da Ya Think I’m Sexy? - Rod Stewart
I Will Survive - Gloria Gaynor
Tragedy - Bee Gees
Golden Tears - Dave & Sugar
1986- Martina Navratilova became the first woman tennis player to pass the $10 million mark in career earnings. She also set the single year record, $2,173,556 in 1984.
1987 -a record 24 hour temperature fall began at Detroit, Michigan. It started at 1:00 PM EST with a temperature of 74 degrees when a sharp cold front dropped the temperature down to 23 degrees at 1:00 PM EST on the 9th. The total temperature fall for the 24 hour period was 51 degrees. - Thirty-two cities in the eastern U.S. reported new record high temperatures for the date, including Madison WI with a reading of 71 degrees. Afternoon highs of 68 degrees at Houghton Lake MI and 74 degrees at Flint MI smashed their previous records for the date by fourteen degrees.
Livin’ ---Top Hits on a Prayer - Bon Jovi
Jacob’s Ladder - Huey Lewis & The News
Somewhere Out There - Linda Ronstadt & James Ingram
Mornin’ Ride - Lee Greenwood
1990 - Late afternoon thunderstorms produced severe weather in east central Iowa and west central Illinois. Thunderstorms spawned a tornado south of Augusta IL which traveled 42 miles to Marbleton. Golf ball size hail was reported at Peoria IL and near Vermont IL.
1992 -in the first 8 days of March, Las Vegas, Nevada recorded 1.87 inches of rain. This set a new monthly record for rainfall in March. The previous record was 1.83 inches set in 1973.
1994- Scottie Pippen and Pete Myers of the Chicago Bulls became the first teammates in NBA history to make four point plays in the same game. A four-point play is a three-point field goal followed by a free throw. The bulls beat the Atlanta Hawks, 116-95.
1994-a major snowstorm buried sections of Oklahoma, Missouri, and Arkansas. Ozark Beach, Missouri recorded 19 inches of snow, while Harrison, Arkansas checked in with 18 inches. Tulsa, Oklahoma had 12.9 of snow, for its greatest single storm snowfall ever.
The Sign- Ace Of Base
The Power Of Love- Celine Dion
Whatta Man- Salt-N-Pepa Featuring En Vogue
Without You/Never Forget You- Mariah Carey
1996 -Elkins, West Virginia received 2.1 inches of snow on this day to bring its seasonal snowfall to 125.8 inches -- its snowiest winter on record.
1996 - An updated remake of La Cage Aux Folles, The Birdcage starring Robin Williams, Nathan Lane, Gene Hackman, Dianne Wiest, and Calista Flockhart, opened in United States theaters. The farcical film, directed by Mike Nichols, won a Screen Actors Guild award for Outstanding Performance by a Cast.