Brett Alldredge, pest management supervisor at Greenleaf Nursery in Texas, handles pest and disease control for 450 acres of ornamental crops. His biggest problem these days is chilli thrips, followed by mealybugs and scale.
Alldredge says chilli thrips start in April and continue to be a problem through October, peaking in the hot summer months. They attack plants with new growth on the foliage, and deform and at times discolor foliage. Chilli thrips are much smaller than the western flower thrip, so they are very hard to see when you’re scouting.
“Those are a real challenge because they fly in in waves and they attack anything that flushes,” he says. “In cooler weather they aren’t a problem. You just don’t see them. Usually April is early, but with mild winter, you see them.”
Features - Taxes
A change in administration most likely means several new tax laws.
Every change in Washington brings the possibility, indeed the likelihood, of tax law changes, and the election of Donald Trump as the 45th President of the United States is no exception. In his campaign, the President-elect highlighted several goals of tax reform that included reducing the official corporate tax rate to 15 percent from its present 35 percent.
In addition, the President-elect would like to see the top individual tax rate at 33 percent, down from 39.6 percent. And, it is not just the President-elect who would like to see the Affordable Care Act (Obamacare) repealed.
President-elect Trump’s campaign promise to work with Congress to introduce broader legislative measures within the first 100 days of his administration included the following:
Middle Class Tax Relief And Simplification Act. An economic plan designed to grow the economy four-percent per year and create at least 25 million new jobs through massive tax reduction and simplification, in combination with trade reform, regulatory relief and lifting restrictions on American energy.
End The Offshoring Act. Would establish tariffs to discourage companies from laying off their workers in order to relocate in other countries and ship their products back to the U.S. tax-free.
American Energy & Infrastructure Act. This would leverage public-private partnerships, and private investments using tax incentives, to spur $1 trillion in infrastructure investment over 10 years. It is revenue neutral.
But, what would this mean for a nursery or growing business?
Of interest to the owners of nursery businesses – and their heirs – the estate tax would be repealed if the president-elect’s proposals bear fruit. However, capital gains on property held until death and valued over $10 million would be subject to tax – with an exemption for small businesses and family farms. To prevent abuse, contributions of appreciated assets into a private charity established by the decedent or the decedent’s relatives would be disallowed.
Corporate tax rate reduction
Both President-elect Trump and House Republicans want the corporate tax rate cut from its current top rate of 35 percent (the highest worldwide) to 15 percent and 20 percent, respectively. The Trump plan “would be a bold step that leapfrogs the United States all the way to having one of the lowest rates in the developed world,” according to the campaign’s Web site.
Trump specifically proposed reducing the top corporate tax rate to 15 percent while extending the same 15 percent top rate to the income of pass-through entities and sole proprietorships. The current top corporate tax rate is 35 percent, and the current top rate on business income from pass-through entities and sole proprietorships is the top ordinary, personal income tax rate of 39.6 percent.
The House Republican’s plan, on the other hand, is more moderate. Their tax plan includes so-called “base broadeners,” which would counter the revenue lost from the rate drop. Trump’s plan doesn’t have those. As a result, under the president-elect’s proposal, the corporate income tax raises less revenue for the government than the House GOP’s plan.
Trump has proposed some sort of tax, similar to the tax on corporate dividends, that would be applied to distributions of business income from other business entities. The Trump campaign has stated that it hopes to include provisions that would prevent the conversion of ordinary income into business income, but more about that below.
With congressional concerns about deficit projections resulting from the Trump proposals, the proposed rates may have to come up somewhat. Congress may also be concerned about extending the corporate tax rate to other business income due in part to the deficit.
The majority of incorporated businesses, so-called “C” corporations, are presently taxed twice – once at the entity level and again when shareholders pay taxes on dividends and capital gains. In other words, pass-through businesses such as LLCs, partnerships and S corporations, don’t pay taxes since their profits are passed through to the owners and taxed at each individual’s personal tax rate.
That’s long been a stumbling block for would-be tax reformers. There’s general agreement that the marginal tax rate on C corporations is too high, but if that is cut pass-throughs would a tax increase rather than a reduction. Some proposals consider cutting the ordinary income tax rate but, according to many experts, that could be expensive to the government’s coffers.
One alternative might be to give pass-throughs a reduced rate compared to wage income – as proposed by Trump (a 15-percent rate cap) and the House GOP (a 25 percent rate cap). Both plans have a top ordinary rate of 33 percent, according to published reports.
However, creating a special rate for pass-throughs can encourage “gaming,” according to the Tax Foundation, a Washington-based think tank, because business owners would have an incentive to recategorize their wage income as business income. The president-elect’s campaign materials seemingly include rules that would prevent pass-through owners from converting their compensation income taxed at higher rates into profits taxed at the proposed 15 percent rate.
The most likely scenario appears to tax pass-through entities at 15 percent but taxed again on distributions. Good news for nursery and growing businesses that retain a substantial share of their income within the business. It would also increase the tax differential between corporate investment and pass-through investment.
Corporate tax expenditures eliminated
Most corporate tax expenditures, except for research and development (R&D), could be eliminated in exchange for a lower corporate tax rate. That’s right, in order to pay for lower business tax rates, President-elect Trump proposes eliminating certain, unspecified “corporate tax expenditures.” He has indicated the research and development credit would be spared.
In the past, Congressional Republicans have run into trouble with lobbyists whenever they get too specific about what tax breaks they would eliminate in return for lower corporate rates. In all likelihood, this will continue to be a difficult hurdle.
Of interest to many small businesses, Trump has proposed a doubling of the Code Sec. 179 small business expensing election from $500,000 to $1 million. That would mean that up to $1 million of expenditures for new equipment and other business property could be immediately written-off as an “expense.” Presumably, the ceiling for all capital expenditures after which the first-year expensing is lowered, dollar-for-dollar would also be rasied.
The lame duck congress
As Congress meets in a “lame duck” session it is expected they will tackle taxes. Exactly what tax legislation Congress will consider remains to be seen but will likely include:
Legislation to renew some expiring tax provisions, especially energy extenders.
Legislation to fund the federal government, including the IRS, through the end of the 2017 fiscal year.
Legislation to enhance the retirement savings of individuals.
Legislation to help citrus farmers, small businesses and more.
As the new Congress is seated, it’s more than likely that Trump’s proposals will be incorporated into a host of already proposed changes. Where this will end up is difficult to predict because a number of tax proposals might emerge on the congressional drawing board in the lame-duck session. More likely, when Congress undertakes the 2018 budget this spring, the process will include:
Creating a new business rate for small businesses that are organized as sole proprietorships or pass-through entities instead of taxing them at individual rates;
reducing the corporate tax rate to 20-percent;
providing for immediate expensing of the cost of business investments;
allowing interest expense to be deducted only against interest income, with any net interest expense carried forward and allowed as a deduction against net interest income in future years (with special rules that will apply for financial services companies);
allowing net operating losses (NOLs) to be carried forward indefinitely and increased by an interest factor, and eliminating NOL carrybacks;
retaining the research credit (but evaluating options to make it more effective);
generally eliminating certain (but unspecified) special interest deductions and credits; and
moving “toward a consumption-based tax approach.”
Paying for the cuts
Obvioiusly, the government must find a way to pay for any tax cuts, real or proposed. Some estimates put the 10-year deficit increase at $9 trillion for the proposals of the president-elect. Obviously, there is some sleight-of-hand that can be used to ignore at least part of the problem currently, but it’ll show up quickly.
The economy will have to grow faster than it has in some time to solve the problem. If not, after the initial cuts, tax rates could creep higher. That has happened in the past, although it might be avoided with significant spending cuts. That approach has, however, proved elusive in the past.
In the long run, the overall tax bills of most taxpayers – including many growers, garden centers and nursery retailers – are almost sure to be lower. Reduced individual deductions may, unfortunately, result in higher personal tax bills. Plus, there could be cutbacks in certain tax credits and other deductions for particular industries meaning some taxpayers may benefit less than others, making it more important than ever to keep an eye on the actions of our lawmakers.
Mark Battersby is a freelance writer in Ardmore, Pa. His tax and financial features have appeared in leading business magazines and trade journals for more than 25 years.
Departments - Green Guide
This stately tree provides the complete package with shade, flowers and fall color.
There’s something magical about standing in the shade of a majestic tree and having to lean your head completely back and squint to see the top. I’m still awed by trees that stretch nearly 100 feet into the sky. In today’s market, many plants are being touted as perfect for small spaces. But the tuliptree (Liriodendron tulipifera) needs a large swath of land to live up to its potential.
This grand hardwood grows from 60 feet up to 90 feet high in the landscape, although they have been known to grow up to 150 feet high in a forest setting. As it ages, the tuliptree bark changes from smooth to deeply furrowed. It features a pyramidal crown which becomes more conical with age.
The four-lobed, bright green leaves measure up to 8 inches across. Fall color ranges from gold to orange to copper.
In the spring, it bears cup-shaped yellow flowers with an orange band at the base of each petal. The flowers are lovely, but not necessarily conspicuous, sometimes partially hidden behind the leaves. The flowers are followed by cone-shaped brown fruits with winged seeds.
Why grow Liriodendron tulipifera?
It’s a fast-growing tree, and its large size creates a commanding presence in the landscape.
The flowers are a nice touch in spring.
It’s a source of wildlife food.
Departments - Tip Jar
We’re confusing most consumers with our marketing jargon.
Years ago, when wholesale nurseries made catalogs and websites (if they even had one), they thought they were talking to people like them – people who know a lot about plants. Today, anyone can access an online catalog or website to get information about plants. That’s a problem because only 20 percent of Americans know a lot about plants. Which means 80 percent know little or nothing. Anyone born after 1963 was most likely not taught to garden by their parents because both of their parents worked. This was the first generation with two working parents, and people had no time for anything extra – including gardening. We need to sell plants to these folks. How can we entice them to buy something with copy they don‘t understand?
The following is an example of website copy written for quite possibly the most famous horticultural introduction in the world. Is this enticing consumers? My comments are in parentheses.
Rose ‘Radrazz’ Knock Out® PP#11836 CBPR#0993
The original member of The Knock Out® Family. This shrub rose set a new standard in disease resistance with little to no maintenance required. (What’s disease resistance?) The bloom cycle (What the?) produces rich cherry red/hot pink blooms that will continue until the first hard frost (A first hard frost is?). Black spot resistant, drought tolerant and self-cleaning (Wait, it cleans? Cleans what?), this rose suits every garden and every lifestyle. (Finally, something we can understand, but still jargon, right?)
Here’s my criticism, and trust me, we are all guilty of this. It has way too much lingo. We need to talk directly to consumers, not to ourselves. Say what you mean. Brag about the plant if it warrants bragging. Describe everything to the lowest common denominator, because we need to be talking to everyone, not the 20 percent who understand. Disclaimer: I worked for Star Roses and Plants when Knock Out was introduced, and the copy I wrote back then and the copy they use now is great, but still full of jargon. I pointed this out to Steve Hutton, president of Star Roses and Plants when I asked his permission to use Knock Out as the example. He told me to tell you he cringed and then promptly fainted.
Why aren’t we telling people how completely amazing the plants are or how to take care of them? Why not make this rose sound like the easiest plant to grow in the whole world, because it could be.
Let’s try this instead.
If you have never gardened before, this is the plant for you.
Plant it - water it really well every two days for the first month, then once a week for the rest of the first summer. After that - watch it grow! This is one of the easiest plants to grow and it will give you months of beautiful pinkish-red flowers. In the fall, the leaves turn deep purple and then fall off after a few frosts. Next spring when the forsythia are blooming (if you don’t know what a forsythia is, Google it and you will know), take some sharp pruners and cut the plant’s branches back to 12-18” tall. Follow this diagram to make sure you remove any stems that are crossing. [Insert a rose pruning diagram on the tag.] That’s all you have to do and this plant will come back year after year and flower from early summer until fall. It’s THAT easy!
Okay, so maybe I went a little too far, but I’m trying to prove a point. But is it really too far or is this what people need to be successful? We send newly adopted pets home with a littany of instructions, but we send most plants home with with a 1x3-inch plastic tag that says next to nothing.
If we write copy for the 100 percent instead of the 20 percent, we can continue to sell more plants to people who know a lot, as well as the people who know little to nothing. We can get people excited about gardening and teach them how to be successful so they buy more plants.
Selling more plants – isn’t that the point?
Angela Treadwell-Palmer founded and co-owns Plants Nouveau LLC., a company that specializes in introducing and marketing new plants to the nursery industry. She’s been around the world, experiencing world-famous gardens and remote areas looking for new ideas and exciting plants. firstname.lastname@example.org.
Rethink employment relationships
Departments - The Human Resource
Try these 9 strategies to retain employees in the age of disloyalty.
Savvy employers recognize that the influx of millennials has fundamentally altered the workplace and calls for a new employment relationship. Still, many employers are unprepared and, worse yet, unwilling to accept that traditional retention rules do not apply.
As 2017 approaches, the demand for labor will intensify. To retain talented workers in a fluid job market, you must begin to think out of the box.
Treat your employees like real business partners. Promote entrepreneurial vision by allowing employees to make decisions that impact the business. Millennials gravitate toward positions that give them flexibility, freedom and control over their lives. They want to make decisions on their own and control the outcome of a situation. Control is often what brings satisfaction in work. That is why so many people start their own businesses!
Maximize job functions. Challenge employees constantly. Once boredom and mediocrity set in, their resume gets posted.
Consider innovative, meaningful benefits. The one thing many college graduates (and their parents) have in common is student debt. According to a May 2016 Wall Street Journal article, 70 percent of college graduates carry average debt of $37,172. To enhance loyalty, consider adopting a loan assistance (repayment) program as an employee benefit. Another thing millions of workers have in common is pet ownership. Consider adding pet insurance as a voluntary benefit. And, to tap into millennials’ sense of social responsibility, consider adding a paid day off for volunteering in the community.
Review your compensation program now. Total compensation must be competitive in today’s market. Gather reliable market data and update your rates and ranges, if necessary.
Get rid of traditional vacation and sick policies. If you want to attract and retain talent in today’s market, a Paid Time Off (PTO) policy is essential. PTO policies combine sick and vacation time and provide employees with flexibility to manage their time off without having to justify their whereabouts. Ensure that the amount of PTO available is consistent with market rates. Millennials value time off far more than traditional benefits, such as insurance.
Provide a road map to success. Clearly define the path to professional growth and development. Create programs for internal certification or promotions. Initiate people immediately upon hire by means of unique, interesting and state-of-the-art orientation.
Promote a continuous learning curve. Think in terms of educating your employees — giving them knowledge for a lifetime versus training them, which typically amounts to teaching them skills for a narrow function. If conducted properly, education becomes an asset, not a cost. Keep employees involved in industry trends and changes. The more immersed they are in the business, the more likely they are to commit.
Communicate unceasingly by means of an employee handbook, personal notes, frequent performance feedback and routine meetings and educational sessions. Instill culture, mission and philosophy every day. Consider an annual opinion or engagement survey to “take the temperature of the workplace” and identify gaps in quality, leadership, safety, morale and other important areas.
Make employees feel like part of the family. Recognize and celebrate important achievements, employment anniversaries and other significant events in their lives.
One thing is abundantly clear from studies in organizational development — loyalty isn’t something you can buy — not for the long term, anyway. Money alone rarely keeps millennials (or any employees) motivated and deeply committed. You must start by hiring the right person and then promote a culture of trust, flexibility, transparency, enthusiasm and challenges. Support the system with strong leadership and innovative programs, and you’re sure to build commitment and loyalty.
Jean Seawright is president of Seawright & Associates, a management consulting firm located in Winter Park, Fla. Since 1987, she has provided human resource management and compliance advice to employers across the country. She can be contacted at 407-645-2433 or email@example.com.