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Fashion to Congress: ‘Our Industry Needs Help Now’

Associations representing the fashion industry sent a letter to Congressional leaders Monday highlighting the sector’s needs as Congress debates additional stimulus measures in response to the Covid-19 pandemic.

Signed by the CEOs of the American Apparel & Footwear Association (AAFA), Accessories Council, Council of Fashion Designers of America and the Travel Goods Association, the letter recommends measures that would support American businesses and American workers.

The group’s recommendations include a federal, short-term backstop to support trade credit insurance, which is primarily used by small businesses that rely on insurance to facilitate cash flow; limited legal liability protection to safeguard businesses from unfair lawsuits; and a return to workplace incentives.

In addition, the letter asks for a Healthy Workplaces Tax Credit to support those businesses that have retrofitted facilities and purchased personal protective equipment (PPE) to protect employees and customers, and a duty drawback, or rebate, for charitable donations to fix a problem in current law that disincentivizes donations of imported excess inventory.

Due to “the immense risk and uncertainty the pandemic has generated in the economy, access to trade credit insurance, a critical facility for cash flow in the industry, has dried up,” the letter read.  The federally backed short-term facility would enable the thousands of small businesses that depend on trade credit insurance to stay in business and participate in the safe restart of the economy, it added.

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On the return to work incentives, the groups said companies are finding it difficult to bring workers back during the pandemic and that incentives to get Americans back to work would benefit workers and companies alike.

“The fashion industry has played its part throughout the COVID-19 pandemic by repurposing supply chains to quickly fill our need for personal protective equipment, adjusting operations in line with health guidance, and creating safe spaces to shop for essential apparel and footwear needs across many seasons of this pandemic,” Steve Lamar, president and CEO of the AAFA, said.

“The stimulus measures delivered by Congress to date have been a lifeline for the economy, however as the pandemic continues to wreak havoc, more is needed to support American businesses and American workers,” he added. “The provisions we recommend will directly help American business, employ more Americans, and support safe retail operations. With the finish line in sight, we must avoid tripping up at the final hurdle and do all we can to prevent further loss due to the pandemic.”

Michele Marini Pittenger, president and CEO of the Travel Goods Association, said the travel goods industry is facing “the perfect storm as a result of the pandemic.”

“Our customers aren’t traveling, which has made the severe drop in sales caused by pandemic that much worse,” Pittenger said. “Our industry and our 100,000 American workers need help now.”

Karen Giberson, president of the Accessories Council, added that the fashion and accessory industries are largely made up of small entrepreneurial companies, many owned by women and minorities. Giberson said “it is critical that we support these companies during this challenging time.”

President Biden has proposed a $1.9 trillion “American Rescue Plan” that among its provisions would fund a national vaccination program to contain Covid-19 and safely reopen schools, deliver immediate relief to working families bearing the brunt of this crisis by sending $1,400 per-person checks to households across America, extend and expand unemployment insurance benefits ,and ensure that families hit hard by the economic crisis won’t face eviction or foreclosure.