Educating Lawmakers About Private Capital Is Top Priority in New Congress

ACG New York’s Middle Market Week ends with panel’s post-midterm legislative outlook

By Kathryn Mulligan

A Democratic majority in the U.S. House of Representatives following November’s midterm elections will impact the Association for Corporate Growth’s legislative agenda and its approach to engaging with lawmakers and regulators, according to speakers at the ACG New York Policy Breakfast last week.

A freshmen class of legislators presents “an amazing opportunity to get in early,” said Maria Wolvin, ACG Global’s vice president and senior counsel, public policy, speaking on a panel at the Nov. 29 event. ACG and members of the middle-market M&A community can educate newly elected officials about the private capital model at the start of their tenure, before they’ve identified their full list of priorities, she said.

A divided Congress is expected to slow legislative activity in 2019, but cybersecurity and workforce development are two areas where lawmakers could act, said Patrick Ottenhoff, a director with The Cypress Group, an advocacy firm that works with ACG.

Gretchen Perkins, a partner with Huron Capital Partners, cited the forthcoming Farm Bill as a piece of legislation to watch. The bill likely will delist hemp products and create new investment opportunities related to cannabidiol, a nonpsychoactive cannabis compound known as CBD. “We can expect to see an explosion in CBD-infused beverages, food and other products,” said Perkins, who serves as co-chair of ACG’s Public Policy Committee. “Other than that, I don’t think anything economically will be accomplished [in the next session of Congress],” she said.

Peter Coy, economics editor of Bloomberg Businessweek, gave an economic update prior to the panel discussion and offered an optimistic outlook for the Federal Reserve. Comments from Fed Chairman Jerome Powell a day earlier were interpreted by market watchers as a sign that interest rates would not increase as quickly as previously indicated. “He’s not a guy that’s going to raise rates in a way that would kill the economy just out of some abstract commitment to an economic model,” Coy said.

ACG will continue to engage with regulators at the Securities and Exchange Commission and other agencies, Wolvin said. Among the topics ACG is tracking is regulatory guidance for private equity marketing, which the SEC plans to issue a notice of proposed rulemaking for in April 2019. Growing the ACG Political Action Committee and engaging ACG members on policy activities are other areas of focus for the association next year.

ACG also plans to focus on legislative issues outside of financial services, such as manufacturing, that are relevant to its membership base.

The policy breakfast was presented as part of ACG New York’s Middle Market Week, which featured a number of topical sessions and the chapter’s annual Private Equity Wine Tasting Gala. The policy panel was held at Winston and Strawn’s New York office and moderated by Tom Clement, a partner with Plante Moran, the event sponsor.

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