SAY NO TO OUTDOORS RETAIL SUBSIDIES

CEO Makes Case Against Corporate Welfare: An Interview with Mark Baker

Gander Mountain CEO stands against tax handouts
Written By: David Ewald
Published In: Budget & Tax News
Publication Date: July 1, 2006
Publisher: The Heartland Institute

With nearly 100 stores in 18 states, Gander Mountain is the nation's third-largest outdoors retailer. Unlike its two larger competitors, Bass Pro Shops and Cabela's, Gander Mountain has achieved impressive growth without seeking targeted tax incentives from state or local governments.

In this interview, Gander's chief executive, Mark Baker, tells us why he believes government officials should oppose retail tax incentives.

Ewald: Gander Mountain has launched a national campaign in opposition to government subsidies in the outdoors retail industry. What is wrong with subsidies?

Baker: Competitors of Gander Mountain have successfully convinced state and local governments in several states to provide large tax incentives in order to build stores in their communities. They portray their stores as "destination retail" in order to secure the incentives, claiming that by having their store in a community it will draw millions of tourists, and their wallets, to the area. However, these retailers are in the marketplace to sell product and turn profit, and like all retailers they analyze the markets to determine where their customers live and shop.

Playing one community off another, these retailers push for tens of millions of dollars from taxpayers to help finance their stores. Even more troubling, in some cases they are persuading states to give them favorable "nexus rulings" that are costing taxpayers even more in lost sales tax collections.

Cabela's estimates that tax increment financing and other forms of government assistance [cover] about one-third of the cost of building new stores--or an average of $10 million to $20 million per location. However, the public financing packages can be larger. For instance, Cabela's received a tax increment financing package totaling $40 million to build a mammoth 180,000-square-foot store in Kansas City, Kansas.

Neither Cabela's nor Bass Pro would disclose the total amount of public money they have received over the years, but our estimates put the combined total at well over $400 million. When you add the value of the nexus rulings, the total goes even higher.


Ewald: What are you doing to oppose these subsidies?

Baker: We've put together and distributed a booklet and educational materials for state and local officials all across the country outlining our concerns. We are meeting with state and local officials directly, and communicating with the media and opinion leaders all around the country. We are building coalitions with taxpayer groups and other nonprofit organizations that share our concerns. We have worked extensively to identify and assist grassroots opposition in targeted communities.

We are building a network of like-minded individuals and think tanks that can defeat these proposals on the ground. We are doing everything in our power to encourage a discussion about retail subsidies and educate the state and local officials that will have the final say.


Ewald: Why doesn't Gander Mountain join in and take the subsidies?

Baker: We believe in the American system of free enterprise and consider these demands to be anti-competitive and fundamentally inappropriate. We cannot in good conscience go down that road and maintain our integrity as a good corporate citizen. We think it's wrong. So we are unwilling to accept the "everyone is doing it" argument and become part of the problem.


Ewald: What do you see as the negative impact of these subsidies on the communities involved?

Baker: Resources that could be used for education or true economic development are being wasted on private retail developments. Communities have been paying big money to bring in low-paying retail jobs. Buda, Texas, for instance, gave Cabela's subsidies worth $61 million, or about $271,000 for every full-time job, according to our estimates. Reno, Nevada spent $54 million, or $208,000 for every job.

It also should be noted that incentives to lure retail into a community often do harm to businesses already located in the area. Local stores and other national firms like Gander Mountain, who don't seek subsidies, are placed at a competitive disadvantage by this practice. Studies have also demonstrated that the promises of increased revenue, jobs, and economic growth are seldom fulfilled.


Ewald: Cabela's and Bass Pro argue their stores are "destination retail" and are appropriate for governments to subsidize. How do you respond?

Baker: The idea of destination retail may have held some merit when you had a very small number of outdoors megastores in the country. But the industry's exponential growth, with Cabela's planning stores in all 50 states, makes these claims obsolete.

If they built 50 Disneylands, do you think they'd be as successful as three? I think Cabela's and Bass Pro have really interesting stores, but when you get to 30, 40, or 50 of them, they become much less of a destination. There are already examples of these companies opening new stores within the purported drawing area of one of their existing stores.


Ewald: Do you consider any government subsidies for retail to be appropriate?

Baker: Yes. Sometimes, government infrastructure expenditures for improved roads or services may be necessary for the construction of a major new development. Modest expenditures of that kind may be appropriate, and Gander Mountain does not object to an appropriate level of government involvement.

But those are not the kind of expenditures we are objecting to. Our competitors are brazenly demanding that taxpayers finance a significant portion of their direct investment costs. Moreover, they ask for favorable tax rulings that exempt Internet and catalog sales from applicable taxes.


Ewald: Bass Pro and Cabela's have criticized Gander Mountain for also accepting subsidies. How do you respond?

Baker: That argument is a red herring. In just a few instances, Gander Mountain or the project developer has received tax assistance of limited amounts for a limited duration, typically amounting to less than $85,000 per store for a five- to seven-year period. Compare this to the $500 million accepted by Cabela's and Bass Pro for subsidy deals in total across the nation for both firms, not including the special tax deal Cabela's has been securing on Internet and catalog sales.


Ewald: How does the explosion in outdoors retail construction over the past few years affect this debate?

Baker: Government policymakers need to understand what's happening in the outdoors retail industry. In the past 10 years, the retail sporting goods industry increased square footage from 1 million to 14 million across the nation. There will be 77 Bass Pros and Cabela's by the end of the year.

As these stores become less unique and more ubiquitous, arguments for government subsidies become ever more unsubstantiated. Gander has been opening about 20 new stores a year for the past two years and plans to open seven to nine more in the next year--all without government subsidies.

FRIDAY, SEPTEMBER 22, 2006 8:13 AM

Sanford still on the hunt
Panel could hinder Cabela's incentives

BY CAROLINE FOSSI

The Post and Courier

Gov. Mark Sanford says he has "one last chess move" up his sleeve to foil an unprecedented set of tax breaks aimed at luring a major outdoor retailer to North Charleston.

Unless lawmakers reconsider legislation crafted for outfitting giant Cabela's, Sanford said Thursday he may ask an arm of the state Commerce Department to oppose the incentives created in that bill.

The Coordinating Council for Economic Development, a 10-member panel that includes some Sanford appointees, must approve certain parts of the package. While the council could not derail the deal entirely, it could throw a wrench into the works, the governor said.

Sanford tried to kill the bill, which for the first time in state history created tax breaks and other incentives for retail businesses. Lawmakers overrode his veto in June.

Sanford said he opposes the legislation because it would force other Palmetto State merchants to subsidize a multimillion-dollar competitor. "We would welcome them (Cabela's) to South Carolina, but we have real problems doing it in this particular way," Sanford said.

The outfitter is said to be eyeing a North Charleston site known as the Ingleside Plantation tract, at Interstate 26 and U.S. Highway 78. It would be the company's first South Carolina store.

Competing retailers say they don't have a problem with Cabela's setting up shop in the state. But most oppose the use of incentives.

"It would give Cabela's an unfair advantage," said Stu Utgaard, chief executive of the Sportsman's Warehouse, which recently opened its first South Carolina store in Columbia.

Local retailers agreed.

"I still don't believe in corporate welfare," said David Clifford, owner of the Seacoast Sports and Outfitters store near Kiawah and Seabrook islands.

Clifford said if the state is going to offer tax breaks to big retailers, it should offer them to small, local businesses as well. "If everybody benefited ... I would strongly support it," he said.

Sanford said he plans to urge lawmakers to nix the deal when they return to the statehouse in January.

"The store hasn't been built yet," Sanford said. "There is still a chance to get state policy right."

Last month, Sanford wrote to about three dozen Charleston-area hunting, fishing, boating and camping stores, asking for their help in criticizing the law.

While incentives are common to lure large industrial or manufacturing projects, they are unusual in the retail sector, given the highly competitive nature of the industry and the mostly low-paying jobs it creates.

The legislation passed in June was tailored specifically for a chain like Cabela's, but did not identify the company by name. It offers sales and income tax credits to an "extraordinary" retail destination that has an aquarium or museum and draws at least 2 million visitors a year. It also required a minimum $25 million investment and at least $2 million a year in sales-tax collections.

Other states have offered incentives to the retailer, stirring controversy in some places. The company has said that the negotiation of tax breaks is a key part of its business strategy.

The bill's sponsors and other supporters, including North Charleston Mayor Keith Summey, have said incentives are justified because Cabela's stores double as tourist attractions.

The chain is known for its expansive layouts, which often feature aquariums, restaurants, gun libraries and fake indoor mountains adorned with wildlife taxidermy displays. The company, which also has a sizeable catalog business, posted a $72.6 million profit last year.

Local tackle shop owner Mike Able said he's talked to dozens of retailers and customers across the state who oppose the Cabela's incentive plan.

Many have contacted lawmakers to voice their opinions, said Able, co-owner of Haddrell's Point Tackle & Supply.

But he doesn't expect the General Assembly to change course. "That's like admitting they were wrong," he said. "There aren't many politicians that would do that."

Reach Caroline Fossi at 937-5524 or cfossi@postandcourier.com.

Outdoor retailer eyes Lacey
Cabela’s could bring 400 jobs; jurisdictions would bear costs
BY CHRISTIAN HILL

THE OLYMPIAN

LACEY — Cabela’s, which describes itself as the world’s foremost outfitter of fishing and hunting gear, is considering a store site in Lacey, but the city, state and property owner would have to spend up to $30 million to land its 400 jobs.


The Nebraska-based company has expressed a strong interest in property in Hawks Prairie for a $40 million store.

Negotiations have just begun on the property off Marvin Road just north of its Interstate 5 interchange.

The economic effect of the store could be tremendous for the community. Cabela’s is known as much for being a tourist attraction as a retailer, and its stores are top draws in many of the states where it operates. The stores feature two-story replica mountains with waterfalls and beaver ponds, 50,000-gallon aquariums with live fish, outdoor walking trails and taxidermy displays that, a spokesman said, can rival what visitors can find at the Smithsonian.

The store is projected to be 225,000 square feet. To compare, the Hawks Prairie Wal-Mart is expanding to become a 216,076-square-foot “supercenter.”

According to one estimate, Cabela’s would attract millions of visitors each year and create hundreds, possibly thousands, of direct and indirect jobs. Of greater interest to South Sound, the store is projected to generate millions annually in new spending from tourists and area residents. The store also could finally realize Lacey’s longtime dream of having a vibrant commercial center in Hawks Prairie.

“You probably couldn’t ask for a better anchor or better draw,” City Manager Greg Cuoio said.

But those benefits wouldn’t come cheaply.

Landing Cabela’s will require a hefty incentive package. The city has applied for nearly $10 million in state grants to help pay for the estimated $29.7 million in road and utility improvements needed for the store. Without the financial assistance, the project can’t move forward, according to documents obtained by The Olympian.

In addition to the grant, the city will kick in $5 million toward the rest of the cost of the infrastructure, estimated at $19.8 million; the property owner has committed to pick up the remainder. The city has left open the possibility that Cabela’s might pick up some of that cost.

The company also must negotiate an agreement for the property. Landowner Tri Vo and his partner have offered about 38 acres at no cost to Cabela’s, according to a letter Tim Holland, the company’s director of new store development, wrote to Lacey Community Development Director Jerry Litt.

The acreage is part of a larger property that Vo and his partner acquired late last year.

“Based on the foregoing assumptions, Cabela’s has a strong interest in moving forward with discussions and investigation of the location and learning more about the potential incentive package,” Holland wrote in the letter, obtained by The Olympian through a public-records request.

Reached Monday, Vo said he was doing research about Cabela’s but declined to comment further.

Company spokesman James Powell advised against reading too much into the inquiry.

“It’s not uncommon for us to be in entry-level discussions without that meaning we’re going to be coming to that location,” he said. “That might be the case there.”

Powell said the company is in an aggressive expansion mode. Cabela’s is one of the largest catalog retailers — mailing 150 million catalogs a year — and it wants its retail division to match that success, he said.

The company operates 14 retail stores — none on the West Coast — and plans to open six more this year.

“It’s very likely we’ll be doing more than that in ’07,” he said.

Powell said it’s likely the company is looking at other properties around the state, but declined to name specific locations.

Asked about the importance of an incentive package to secure a store, Powell responded: “For a large store, it’s very important to crucial, I would say.”

The incentives are sizable, but both the developer and city realize that Cabela’s has the ability to draw hotels and other retailers around its stores.

It’s the type of activity the city has been seeking since it zoned the property as a business district to pull visitors into Hawks Prairie.

A family trust held the property for decades, and it wasn’t until Vo and his partner bought the 374-acre property in October for $25 million that the city’s vision was revived. The property Cabela’s is eyeing is only a tiny portion of what Vo and his partner purchased.

Michael Cade, executive director of the Economic Development Council of Thurston County, said he would expect Cabela’s shoppers to come here from as far as Seattle and Portland.

“They are a retailer that brings dollars into the area, and not just from local people,” he said. “It’s destination retail.”

Cade said he tried to woo Cabela’s when he was in a similar position in Snohomish County. Cuoio said the city staff made its first contact with Cabela’s six years ago.

Cabela’s is looking to open the proposed store in early 2008, according to Cuoio.

Cuoio said he has heard that company representatives are impressed with the property’s wooded terrain, easy access to I-5 and view of Mount Rainier.

But he said a lot of pieces have to fall together for a proposal of this scale to become reality.

“While we’re enthused, we’re measured in our outlook,” he said.


ADDING UP THE COSTS

The effort to draw Cabela’s to Lacey won’t come cheaply for the property owner or city.

The city estimates it will cost $29.7 million to make the needed road and utility improvements to serve a proposed 225,000-square-foot store.

The city and developer tentatively have committed $19.8 million for the projects. The city has applied for state grant money to cover the rest.

The improvement projects and costs are:

• Ten thousand linear feet of new roadway to connect to the store, $9.4 million

• The right of way for the roadway, $8.8 million

• Widening Britton Parkway, $720,000

• Adding a lane to the southbound offramp from I-5 at Marvin Road, $500,000

• A regional facility to collect stormwater from the store site and new roadway, $4.3 million

• A lift system and pipes to collect wastewater and move it for treatment from the store and surrounding properties, $3.5 million

• An acceleration lane for the I-5 interchange, $100,000

• Development fees and other off-site improvements, $2.4 million.

The city filed a pre-application for the grant money earlier this month. State officials will review and comment on the application by Friday. The city must submit a final, more formal, application by April 3.

The Legislature is expected to earmark up to $49.5 milion in 2007 for projects that will compete for the money.

Sanford takes aim at Cabela's incentives
Monday, September 11, 2006

Gov. Mark Sanford, never one to shy away from scrapping with the General Assembly, fired another salvo at fellow lawmakers this weekend when he attended the Columbia ribbon-cutting for a Sportsman's Warehouse.

Sanford probably wouldn't normally make it to such an event, but a multimillion-dollar incentive package passed for Cabela's a few months ago is still sticking in his craw. The governor was on hand to note that Sportsman's Warehouse was getting no such deal.

"Getting into the business of subsidizing retailers in this way that's never been done before is a menace to mom-and-pop shops all over South Carolina," Sanford said. "It amounts to a penalty against family-owned businesses, and a penalty against straight-up competitors like Sportsman's Warehouse and Bass Pro Shop who didn't ask for special treatment and subsidies."

The governor called on the General Assembly to reel the incentives back in when they reconvene.

Sanford, however, missed the ribbon-cutting for the Tanger Outlet Center a week earlier, where North Charleston Mayor Keith Summey once again championed the Cabela's incentives. "I think it's a tourism draw," he said.

Article published September 14, 2006

Bass Pro education facility in Rossford to get $1million
State also approves rebate of sales tax

By JENNIFER FEEHAN
BLADE STAFF WRITER


The state is sweetening the pot for Bass Pro Outdoor World LLC to locate a $50 million retail development in Rossford.

Gov. Bob Taft announced yesterday that the Ohio Department of Natural Resources had committed $1 million to help develop an outdoor education center at the Bass Pro store proposed for the Crossroads of America off I-75 near the Ohio Turnpike.

The Department of Development also notified Wood County officials late yesterday that Bass Pro had qualified for a rebate of up to 75 percent of the county's 1 percent sales tax on sales made at the new store for up to 10 years or until the megasports outfitter had recouped its development costs.

"This clearly is an important step in the right direction with a little bit of additional good news in that the state Department of Natural Resources sees value to this project as well," Wood County Commissioner Tim Brown said.

State Rep. Bob Latta (R., Bowl-ing Green), who has been working for more than eight years to land Bass Pro, said the $1 million from ODNR would come from hunting and fishing license fees and from federal excise taxes on hunting and fishing equipment that is rebated to the state based on the number of hunting and fishing licenses it sells.

Mr. Latta said that money often is funneled to ODNR projects in other parts of the state. But under this proposal, local anglers and hunters would see some of the dollars they spend come back to the area.

"This would be a perfect fit," he said.

"I think it's great news for the local sportsmen in the area," Commissioner Jim Carter added.

Rick Ferguson, owner of Szuch Live Bait on Corduroy Road in Jerusalem Township, said he likes the idea that the money will be coming back to the area, but he would prefer to see it spent on educational endeavors, not bricks and mortar.

"If it's for education, I'm all for the kids. But if they're giving it to them to just build, then I've got a problem with it," Mr. Ferguson said. "It's kind of a double-edged sword for me because it's going to hurt my business if they open here."

ODNR spokesman Jane Beathard said a similar deal was given to Bass Pro when it located a store off I-275 near Cincinnati. Money generated from Ohio hunting and fishing licenses as well as the state's share of a federal tax on hunting equipment was used to pay for a large aquarium and an interpretative kiosk in the educational section of the store.

She said Ohio law forbids the use of the money to subsidize Bass Pro's retail operations. Although ODNR has underwritten native wildlife displays at Ohio zoos and at COSI, the Bass Pro projects are the only instances where the department has joined forces with a retailer.

"By Ohio law, outdoor education is one of the purposes for money generated by the sale of hunting and fishing licenses," she said. "It promotes hunting and fishing because it promotes outdoors education and the development of outdoor skills.

"They teach everything from nature interpretation to angling skills and hunting safety," she said.

County commissioners said they planned to get a letter off to Bass Pro today letting the company know that it had qualified for the sales tax rebate outlined in a new state law that was crafted specifically to attract Bass Pro.

The law applies to retail and entertainment facilities deemed impact facilities if they invest at least $50 million within two years, draw more than 50 percent of their customers from at least 100 miles away, dedicate at least 10 percent of their facility to educational and exhibition space, and maintain a minimum employment level of 150 full-time equivalent workers.

"Now that the Department of Development has said it is an official impact facility, that clears the way to negotiate with Bass Pro as to the percentage of tax and length of time," Mr. Carter said.

The timetable for the project will be up to Bass Pro, Mr. Brown said.

"When we got their letter notifying us of their interest, we Federal Expressed it down to the state for consideration, and we will act immediately again to notify Bass Pro that we have received the green light to negotiate," Mr. Brown. "We are acting as quickly as we can."

In Bass Pro's application for the sales tax rebate, it outlined plans for a 150,000 to 180,000-square-foot restaurant and retail store that would "offer northwest Ohio's largest selection of quality outdoor gear, clothing, and accessories from leading industry names, including equipment and clothing for fishing, hunting, boating, hiking, backpacking, wildlife viewing, outdoor cooking, and more."

The store also would feature a gift and nature center, a large boat showroom, an 18,000-gallon aquarium, and native wildlife and artifact displays.

Other features planned at the Rossford store are "museum-quality wildlife dioramas, huge murals and chandeliers depicting outdoor scenes, massive log and rock work, waterfalls and other water features, and aquariums stocked with native fish species."

Exhibition and recreation space would include climbing walls, archery ranges, fine gun rooms, NASCAR shops, and a laser arcade.

The company said it planned to offer free outdoor-skills workshops and invite scout, school, and church groups to the store for field trips.

Bass Pro expects the development to create the equivalent of 250 full-time jobs

Jim Provance of The Blade's Columbus bureau contributed to this report.

Contact Jennifer Feehan at:
jfeehan@theblade.com
or 419-353-5972.

Article published Sep 12, 2006

Cabela's tax break raises eyebrows
Sales tax exemption gets scrutiny in Idaho, other states

Ken Dey
Idaho Statesman

Idaho officials contend they were only following the law when the Tax Commission ruled that Cabela's Inc. would not have to collect Idaho sales taxes on its online and catalog sales.

But legal and legislative efforts under way nationwide would tighten the tax laws and eliminate the so-called gray area that allow companies like Cabela's to avoid collecting state sales taxes from online customers.

The issue has caught the attention of Idaho legislators.


"I definitely think we need to look at this in the next session. I'm concerned about it, and others are too," said Sen. Brent Hill, R-Rexburg, who will likely be the new chairman of the Senate's Local Government and Taxation Committee when the Legislature convenes in January. "I don't want people to think we're bending over backwards for the big outfits while sacrificing our small businesses and putting them at a competitive disadvantage."


Cabela's successfully argued that the company's online and catalog divisions are separate companies from the company's retail operations and therefore have no "nexus" — a physical presence, such as an office, branch, warehouse or employees — in the state to require the collection of taxes.

The Idaho Tax Commission denied the Idaho Statesman's public records request for additional information about the Cabela's ruling and rulings for other companies, citing the state's taxpayer confidentiality laws.


Deputy Attorney General Ted Spangler, who represents the commission, said rulings aren't required. If other companies are not collecting sales taxes for online and catalog sales, they're doing so because they think they're operating within the law, he said.

Time for a challenge


Idaho isn't alone in giving Cabela's a favorable ruling. The company said it has received such rulings in 11 states where it has retail stores and claimed no nexus for the online operations.

Cabela's says it requests rulings because its customers don't like paying the taxes, and the taxes put the company at a competitive disadvantage with other online retailers with no presence in Idaho that don't collect taxes.

But in Maine, where Cabela's hopes to build, a number of state and business leaders are speaking out against Cabela's request for the tax break because, they say, it would be unfair to other Maine companies that collect sales taxes on online sales.


"States could easily say no," said Michael Mazerov, senior fellow with the Washington, D.C.-based Center on Budget and Policy Priorities, a nonpartisan organization that monitors tax policy and how it affects low-income families. "But you never know when a big economic development deal comes forward how much pressure will be bought to bear to get a ruling like this."

Mazerov said it's a "murky" area of the law and, if tested, he believes the Supreme Court would uphold a state's right to require companies like Cabela's to collect sales taxes.


Idaho's sales tax collection policies are based on a 1992 U.S. Supreme Court ruling in Quill Corp. v. North Dakota. North Dakota wanted the Quill office-products company to collect state sales taxes from its customers despite having no presence in the state.

The Supreme Court ruled that the company must have a nexus before the company can be required to collect sales taxes.

Cracks in Cabela's strategy


Cabela's declined to comment for this story. The company said in its annual report with the U.S. Securities and Exchange Commission that it would challenge any efforts to deny the sales tax exemption in states where Cabela's has no online nexus but conceded that it might not prevail.

California denied a similar exemption for Borders Books and Music, which maintained that its online operation was separate and had no presence in California. Borders appealed, but the denial was upheld by the state's court of appeals. The court ruled in June 2005 that Borders retail and Borders online were not separate companies and couldn't be exempt from collecting sales tax for online purchases. The court cited Borders practices such as allowing customers to return online items to retail stores, imprinting its receipts with the company's online address, referring retail customers to its online site, and using similar logos and shared market and financial data between online and retail.


A similar case against Cabela's is now pending in Texas. Gander Mountain Co., a competing sporting goods company based in Minnesota, alleges that actions by Cabela's do not support the company's contention that its retail operations are separate from online and catalog operations.

The lawsuit alleges that online and catalog customers can return items to a retail store, that catalogs are distributed at retail stores, that retail store employees assist customers in placing catalog orders at the store, and that Cabela's retail stores promote and advertise the Cabela's Web site in the stores. Gander Mountain also alleges that the company's Web site provides information about its retail stores.

Mazerov said the allegations clearly show that Cabela's retail sales representatives are acting as representatives of the Web site.
"To me that should be a no-brainer for nexus," he said.

Changing the laws


Although the Idaho Tax Commission ruled in favor of Cabela's, the commission is supporting changes that would no longer allow Cabela's and others to qualify for an exemption.

As a member of the Interstate Tax Commission, Idaho last month voted in favor of a model statute for states to clarify what actions establish a nexus. The Sales Tax Nexus Provision would conclude that an out-of-state company with no physical presence in a state would still be considered to have a nexus in the state if an online company is related to a retail store within that state for tax and financial purposes. The two also would have to share a similar name, trade name or trademark.

The provision didn't pass but could be brought up again.


Idaho has also been monitoring the Streamlined Sales Tax project, which asks states to simplify sales-tax collection procedures to make it easier for online and catalog sellers to collect the tax. Twenty states have passed legislation to accomplish that, but Idaho hasn't yet pursued legislation. A bill in the U.S. House would make streamlining sales tax procedures a nationwide requirement, but few people believe it will pass this session.

The Streamlined Sales Tax project indirectly addresses the nexus question, but proponents hope that by streamlining sales tax collection, online and catalog companies will be more receptive to collecting the taxes. Many of the larger retailers, including Wal-Mart, Target and Best Buy, support the Streamlined Sales Tax project and already collect sales taxes in states where they have a presence.