Business The Salina Journal Sunday, February 2,1986 Page 26 Businesses want tougher bad check laws By JUDITH WEBER Staff Writer If Kansas' largest small business organization has its way, bad-check writers soon may be facing tougher penalties. Hot checks continue to be a serious problem for merchants. It is estimated to cost them up to $5 billion annually, with much of the loss being passed on to consumers through higher prices. But the National Federation of Independent Business in Topeka is trying to take the bounce out of bad checks with legislation that would make bad-check writers liable for triple the amount of a dishonored check. James Yonally, governmental relations director for NFIB in Kansas, said the bill is still being drafted. The triple damage proposal would include a minimum penalty of $100 and a maximum penalty of $500 for people who do not make their check good within 21 days after being notified of a returned check, he said. A poll of 8,000 Kansas NFIB members showed that 84 percent feel businesses should be afforded more legal protection from bad check writers. "The small business owner has always been a sitting duck for the bad check passer because criminals have correctly assumed that it's too costly for most small merchants to sue for damages, particularly for smaller amounts. A $100 fine makes it worthwhile to go after," Yonally said. "Kansas misdemeanor or even criminal- class penalties don't provide much support, let alone a deterrent, to those who intentionally set out to defraud store owners." There are a number of people who take advantage of the system, and it is that criminal element the association is going after, Yonally said. "This is not a witch hunt for people who may occasionally write a check with insufficient funds due to a simple bookkeeping error," he said. Yonally said that nine other states have passed legislation setting tougher penalties for bad check writers that have proven successful. In Colorado, bad check passing has been reduced by 12 percent, and California experienced a 21 percent decline, he said. "We're not at all interested in collecting triple damages. We're just trying to get people to stop writing bad checks.'' Yonally also said his association's proposal has received a good response from Kansas legislators. Associate District Judge Gene Penland estimates that 500 to 600 bad check cases are filed annually in district court. "It's always been that way. It's just a con- tinuous problem," he said. Saline County Attorney Mickey Mosier said that most bad checks turned over to his office are for amounts less than $50. Dealing with bad check cases is almost a full-time job for one employee in his office, he said. Many of the people appearing in court for such offenses are not criminal types, but mostly irresponsible or careless people, Penland said. "It's amazing how many people write checks and keep no record at all." Penland said that first offenders usually are ordered by the court to pay the merchant the '"We're not at all interested in collecting triple damages. We're just trying to get people to stop writing bad checks." — James Yonally value of the bad check and court costs. Court costs for a misdemeanor are $86, and for a felony are more than $100. A bad check written for an amount of more than $150 is a felony in Kansas. Repeat offenders receive stiffer penalties, which could include probation or jail, Penland said. Current penalties are sufficient, he said, because "the rate of recidivism is not that great." The experience of having to go through the court system is enough to keep many people from repeating the offense, he said. "I don't know of any way it could be stopped completely when checks are so widely used and accepted." Gary Wickersham, manager of the Salina K mart store, estimated the store is unable to collect $5,000 to $6,000 a year from bad checks. And about three times that amount is eventually paid after bad-check writers are tracked down, he said. "That takes a lot of tune and effort." The hours involved in trying to collect bad checks also adds to consumers' costs, he said. Many of the cases are turned over to a collection agency or the county attorney. Wickersham said many customers are upset when informed that their check bounced. "Their first response is "The bank messed up.' Most of the time that's not so." K mart keeps a list of bad-check writers and Many merchants favor tougher penalties for bad check writers. doesn't accept checks from customers outside a certain geographical area. Checks for more than a certain amount have to be approved by management, he said. Cashiers at Dillons in Sunset Plaza also note information on checks and ask for proper identification. The store has a computerized scanning system with information on former bad-check writers, manager Wendell Scott said. But first time offenders are hard to stop, he said. "I think Kansas needs tougher laws." There are repeat offenders who continue to write bad checks, Scott said. Joyce Marrs, who with her husband runs the Salina Check Rite office, said more merchants seem to be taking steps to control the problem. More merchants subscribe to Check Rite's services every year, she said. Check Rite is a franchise check recovery agency based in Denver. Check Rite is getting competition in some cities as more and more check collection agencies are created, she said. Such agencies allow merchants to work together to fight the problem and a pool of information allows patterns of bad check writing to be detected, Marrs said. She said the percentage of bad check writers who intentionally skirt the law is small. "But when they do it, they do it in such large amounts it makes the average consumer pay for it for some time." Time announces profit decline, worker layoffs NEW YORK (AP) — Time Inc., seeking to protect its financial health after a decline in profit, said Thursday it was laying off 136 editorial and business employees in its magazine division. The move came as the media conglomerate announced a $16 million decline in fourth-quarter profit, including an estimated $13 million cost of the layoffs. Its profit for the full year also was down by $16 million. "We must run leaner operations," company officials said in a memorandum distributed to magazine employees. They said the staff reduction was part of an effort to reduce expenses by $75 million, or 2.5 percent, this year. Tune Inc. said its profit in the fourth quarter of 1985 was $51 million, down from $67 million a year before despite a $95 million increase in revenue. Earnings for the full year were $200 million, compared with $216 million in 1984; revenues was $3.4 billion, up from $3.1 billion. Time Inc. magazines, with a combined circulation of 19 million, include Time, Sports Illustrated, Discover, Life, People, Fortune and Money. The firm last week halted tests of a new magazine, Picture Week, for editorial changes. The corporation also owns Home Box Office Inc., American Television and Communications Corp., Time-Life Books Inc.. the Book-of-the- Month Club and Little, Brown and Co., a publishing company. Laid-off workers will remain on the payroll for two months and will receive severance benefits based on longevity. The magazines' 1,545 editorial employees are represented by The Newspaper Guild, while the 2,188 business employees do not have union representation. Retirees filling more temporary positions By The New York Times HARTFORD, Conn. — After working for 44 years, Sylvia Corvo looked forward to retirement. But after seven years of travel, bridge games and lunch parties, she recalls, "I woke up and realized I was bored." Today Corvo, at age 76, is back on the job. Her lifelong employer, the Travelers Insurance Cos., hired her back under a new program using retirees for part-time jobs. In the last several years, an increasing number of companies across the country have filled temporary positions with a new source of labor: retirees. And, as Travelers is doing, many of the employers are hiring the part- timers from the ranks of their own retirees. Labor experts say the trend is a reflection of the aging of the country's population. "The number of young people is down and businesses are finding themselves shorthanded," said Fran Rothstein, director of research at the National Alliance of Business in Washington. In the next 35 years, the portion of the population over 65 is expected to nearly double, from 11 percent today to 20 percent in 2020. And by the end of this century, experts believe, the number of people under 65 who are available to work will level off. "We will see more and more incentives for people to work later in their lives," said T. Franklin Williams, director of the National Institute on Aging. Retirees say part-time employment keeps mem in better physical, mental and financial shape than full retirement. Company officials say returning retirees are more motivated and better trained than temporary workers provided by outside agencies. Older workers, they add, often imbue young workers with good work habits. Sometimes, they have unique qualifications. "Western Savings and Loan in Arizona has found that many of its older employees appear to relate better to older customers and therefore has actively sought older persons for jobs as tellers," according to a study by a special U.S. Senate committee on aging. The study looked at 38 American companies that employ retirement-age workers. At Travelers, a major insurance and financial services company based here, retirees are regularly recruited at "Un- Retirement Parties." They are urged to sign up for the company's Retiree Job Bank, and are given big red buttons declaring: "You can't play golf seven days a week or go fishing seven days a week." — Gil Chapman "I want to be Un-Retired." The last such party produced 400 retirees for the Job Bank. "It's a win-win situation — the company wins, you win," said Gil Chapman, 66. Chapman, a former pension analyst, gave up full retirement recently to work three days a week on projects at Travelers. "You can't play golf seven days a week or go fishing seven days a week," Chapman said, as he paused from writing job descriptions. "You've got to have a feeling of worth, a feeling of making a contribution." Managers praise retirees as reliable and conscientious. They recall when, during a blizzard here, many of Travelers' 11,000 employees stayed home but 10 retirees came to work. "We cannot fill the requests we get from our managers for retirees," F. Peter Libassi, a senior vice president of Travelers. Libassi noted that in the United States the trend has been for the elderly to work less. The portion of Americans over 65 who work has dropped steadily, he said, from 40 percent in 1959 to 16 percent today. Despite this, more and more companies are hiring retirees on a part-time basis. Benefits of oil price drop lie ahead NEW YORK — Send up two cheers for the sudden drop in the market price of oil. It's too soon to feel these drops at the gasoline pump or in your home-heating bills. But assuming, as I do, that oil prices are down for a while, some interesting prospects lie ahead. On gasoline: Last year, average gasoline prices rose a few cents a gallon, even though crude-oil prices fell. The main reason, says price analyst Daniel Lundberg, was the higher cost of refining gasoline, in order to meet the new, lower lead levels required by law. Today's average prices, as compiled by the Lundberg Survey: $1.37 a gallon for full-service gasoline, and $1.16 if you pump it yourself. Lundberg thinks that the recent oil- price drops are not enough to bring gasoline prices down. "Dealers are paying sharply more for rent and insurance," he says, "and the costs of the lead phase-down have only begun to be felt." He predicts higher prices, unless the oil market keeps on falling. One other important point to understand about the cheap-oil headlines is this: So far, crude oil has sold for less than $20 a barrel in a relatively limited number of transactions — principally in the "spot" markets, which handle quick transactions of available oil. Longer-term contract Jane Bryant Quinn WASHINGTON POST prices are more like $24 to $27. But oil analysts say that, in the past couple of months, the total amount of American imports from the Persian Gulf has probably doubled, and some of that oil has been carrying some remarkable discounts. So have cargoes of surplus oil from the North Sea, and spot shipments in Texas. At the same time, oil refiners have been producing flat out. If those trends continue, gasoline stations may be lowering prices sooner than they planned. But even at present prices, the increased fuel efficiency of automobiles makes driving a bargain. Adjusted for inflation, gasoline cost 4 cents per mile driven in 1981, according to Cambridge Energy Research Associates. By the end of 1985, that was down to 2.7 cents per mile driven. Heating oil: The cost of heating homes with oil will also fall, if the drop in crude-oil prices is sustained. You won't see it right away. Deal- ers will wait for their contract prices to reflect the bargains in the spot markets; other business considerations, like operating costs and inventories, also affect price. Short supplies in the early part of this winter put heating-oil prices up. But over time, the price oil users pay to heat their homes will follow the path of the cost of crude. If you're building a house or an addition to your home, and have to choose between heating it with oil or with electricity generated by fossil fuels, oil is looking like a more competitive choice. Prices should be level to down, while electricity prices are generally going up. (But electricity is still the better choice, where it's generated by cheap water power.) Natural gas: Cheaper oil also has an impact on the future price of natural gas. Many major industrial users can switch back and forth between the two fuels, so the lower the oil price, the lower the ceiling on what gas pipelines are able to charge. Right now, gas prices are well below their equivalent in oil prices. If you're paying $2 to $2.50 per thousand cubit feet of gas, you have the equivalent of heating oil at $12 to $15 a barrel, says David Montgomery of the U.S. Department of Energy's Energy Information Administration. That compares with a heating-oil price today of around $23 a barrel. If you're able to choose between natural gas and oil for heating your house, gas still looks like the better buy — not only today but probably well into the future. There's enough price difference for gas to maintain its edge, even if oil prices decline. "Also, I don't think that oil prices will stay at rock bottom over 10 or 20 years," says Michael Toman of Resources for the Future in Washington, D.C. "Over the long term, I have more confidence in the long- term pricing and availability of natural gas than I do of oil." Last January's partial deregulation of natural gas, and lower prices for certain types of gas in the field, have not yet been felt in average contracts for supplying consumers. But given time, they will. Solar energy: With oil and gas prices flat to falling, it's getting hard to justify Luying a solar hot-water heater, especially hi the northern parts of the country. But it still makes sense to add passive solar and energy-saving features to your house: big windows on the south, extra insulation, weath- erstripping. Heating-oil prices may be edging down, but they're still a lot higher than they were 15 years ago. No one can afford to let heat escape into the winter air. Millions elect to go it alone with tax returns NEW YORK (AP) — Although professional tax preparation has become a big business, millions of Americans again this year will do battle on their own with their income tax returns. A good many of the do-it-yourselfers actually relish the challenge. They believe that their thorough familiarity with their own personal finances gives them an edge over any outside "expert." They save the expense of the preparer's fee, which can be substantial for anyone in even moderately complicated circumstances. What of the time and trouble required to fill out the forms and keep abreast of changing tax laws? Do-it-yourselfers say the pay for this work is pretty good, when you consider that a few hours of effort can sometimes produce large savings, in after-tax money. Obviously, going it alone isn't for everyone. It you know of some savvy adviser whom you trust completely and whose fee looks reasonable for the services provided, it makes sense to get that person's help. The same goes if tax preparation bewilders or bores you, and you are busy with other important things. If the past year has brought some major change in your life — say a change of jobs or a move from a rental apartment to a home of your own — you may be well advised to seek outside advice. If, on the other hand, your working and financial activities in 1985 were pretty much the same as they were the year before, you already have one valuable guide to go by: Your return for 1984. It can serve as a check against overlooking some important item you deducted in the past. One of the popular tax guides published each year can provide you with a summary of the relatively few changes in the tax rules that took effect in 1985. For tax filers who go it alone, what follows is a sampling of some often-overlooked deductions, credits and other useful tax angles, gleaned from analyses by specialists on the subject: • Check thoroughly for all interest payments you made, not just on a mortgage or car loan, but on credit cards, educational loans, and even perhaps on back taxes. • Similarly, review all taxes paid to state and local government. The tax forms contain tables you can use to figure deductions for sales taxes. "However," notes the accounting firm of Del- oitte Haskins & Sells, "your deduction is not limited to this amount. You are also permitted to deduct substantiated sales taxes paid on the purchase of a car, motorcycle, motor home, boat, airplane, home or home materials, in addition to. the amount in the table. "Of course, you also have the option of disregarding the IRS tables and deducting actual sales tax expenditures, but all such amounts must be substantiated." • In figuring deductions for charitable contributions, don't forget any transportation costs related to such things as volunteer work. "Non-itemizers can claim a limited deduction for contributions to charity," notes Commerce Clearing House, an organization that reports on tax and business law. • Lawyers' fees for obtaining a divorce aren't deductible. But alimony is, for the person who pays it. So are any legal fees paid to assure collection of alimony. • Deductible business expenses may include costs of uniforms and uniform cleaning, dues paid to unions or professional associations, and subscriptions to publications that are necessary in your work. • If you paid a professional preparer to figure your taxes a year ago, be sure to deduct the fee on this year's return.
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