To quickly help you navigate the full impact of IHRSA's efforts advocating for your business and the industry, we have divided each issue in this section of the report into five categories.
Victory
Industry positive legislation passed or industry negative legislation prevented due to IHRSA’s direct advocacy.
Pending
Bills that are still active as the Legislature in that state remains in session.
Favorable
Industry positive legislation that became law.
Building Momentum
Industry positive legislation that did not advance into law.
Defeat
Negative legislation that became law despite IHRSA’s direct advocacy efforts.
Automated External Defibrillator (AED)
IHRSA supports AED legislation that contains necessary liability protections—use and non-use—for club owners and their employees, reasonable staffing requirements for staffed and unstaffed clubs, and adequate compliance time.
VICTORY
Georgia SB 420—IHRSA monitored Senate Bill 420, legislation that would have required health clubs with 500 or more members to have at least one AED onsite during business hours, ensure that designated staff members are trained in CPR and AED use, and notify emergency medical services after any person administered emergency care to another person using an AED. SB 420 passed in the Senate but did not advance in the House. IHRSA also tracked
House Bill 992, which would have recommended that health clubs maintain an AED onsite. HB 992 passed both legislative chambers in different forms but ultimately did not become law.
New York SB 6357—Senate Bill 6357 was first introduced in 2017 and carried over to the 2018 legislative session. Currently, only health clubs with 500 or more members must have an AED on premises and ensure that at least one staff member trained in CPR and AED use is present during business hours. SB 6357 would have expanded this mandate to health clubs with 50 or more patrons. SB 6357 did not pass during the 2018 legislative session.
Tennessee HB 94—House Bill 94 was first introduced during the 2017 legislative session and carried over to the 2018 legislative session. It initially required facilities with a capacity for 500 or more occupants to maintain an AED on the premises and have at least one staff person trained in CPR and AED use present during public functions. In 2018, the bill was amended to remove the occupancy requirement and apply only to facilities with 12,000 or more square feet. IHRSA submitted testimony in opposition to HB 94, and it ultimately did not pass.
PENDING
Virginia SB 654—IHRSA actively monitored Senate Bill 654 in 2018 and will continue to monitor the bill in 2019. Originally, SB 654 required all health clubs to maintain an AED on the premises, develop an emergency response plan with local emergency medical providers, and ensure that at least one staff member trained in AED use is present during business hours. SB 654 was ultimately amended to include only the provision that health clubs maintain an AED on the premises. After SB 654 passed the Senate, IHRSA sent a letter to House leadership requesting clearer liability language. The bill was passed by indefinitely (PBI) in the House. This action will allow the committee to reconsider the legislation before the established deadline. Although this bill is likely dead, it cannot be considered a victory as the Virginia legislative session continues into 2019.
BUILDING MOMENTUM
Massachusetts HB 2278—House Bill 2278, required clubs to draft and rehearse emergency response procedures and ensure that AED(s) are accessible and well-marked. IHRSA supported a second emergency response bill—HB 94—which strengthened immunity provisions for health clubs. It advanced but did not pass during 2018.
Rhode Island S.2698—IHRSA supported Senate Bill 2698, legislation that would have extended immunity protections to all people who use or omit to use an AED during an emergency situation. Existing law provides protections for health clubs and their employees in AED use and non-use situations.
Automatic Renewal
IHRSA supports contract provisions that allow for automatic continuation of service at the end of the original term on a month-to-month, at-will basis, as it offers consumers increased choice and flexibility.
VICTORY
Minnesota HF 209—House File 209 was introduced in 2017 and did not advance past the committee stage in 2018. If passed, it would have mandated that businesses employing automatic renewal contracts clearly and conspicuously disclose to the consumer the automatic renewal clause and the procedure for canceling it at the time the consumer enters contract, and notify the consumer of the automatic renewal clause and the procedure for canceling it.
Senate File 230—IHRSA monitored Senate File 230, legislation that was substantively similar to HF 209. It did not advance out of committee.
New York A.5223—Assembly Bill 5223 proposed that it shall be unlawful for a business that automatically renews a consumer agreement to:
- Fail to present the renewal terms in a clear and conspicuous manner;
- Charge the consumer without first obtaining the consumer’s affirmative consent to the agreement containing the renewal terms;
- Fail to provide an acknowledgment of the renewal terms and cancellation policy in a manner that is capable of being retained by the consumer.
A.5223 was introduced during the 2017 session and was active during the 2018 legislative session, but did not advance out of committee.
Washington, D.C. Bill 20—Bill 20 was first introduced in 2017 but passed during the 2018 legislative session. Bill 20 mandates that businesses utilizing automatic renewal contracts that renew for a period of one month or more disclose the terms of the automatic renewal provision in a clear and conspicuous manner, disclose to the consumer that the contract will automatically renew unless the consumer cancels the contract, notify consumers between 30 and 60 days before the cancellation deadline of the automatic renewal, and provide the consumer with an opportunity to cancel the automatic renewal provision before charging the consumer for continuation of service.
IHRSA’s direct advocacy efforts led to substantive changes to Bill 20 that benefitted clubs. For instance, IHRSA worked with a lobbyist and successfully submitted amendments that stipulated that businesses could notify consumers of an automatic renewal provision by an easily accessible form of communication and removed a provision that mandated that businesses receive the consumer’s affirmative consent before charging them for continuation of service. IHRSA also organized a grassroots campaign that allowed clubs in Washington, D.C., to advocate against the bill.
Maryland HB 1372—The Maryland Legislature considered House Bill 1372, which proposed that businesses utilizing automatic renewal contracts:
- Clearly and conspicuously notify the consumer that the contract will automatically renew unless the consumer cancels the contract;
- Receive the consumer’s affirmative consent before charging the consumer for continuation of service;
- Disclose the cancellation policy and procedures for canceling the contract.
IHRSA expressed concerns with the bill to the Attorney General’s office and submitted written opposition to the House Committee on Economic Matters. HB 1372 did not advance in the Senate and did not become law.
Massachusetts HB 3471—IHRSA submitted testimony against HB 3471 in 2017, and it did not gain traction during the 2018 legislative session. It was added to a study order in July, but it has not moved since. If passed, it would have required businesses to send notification of automatic renewal between 30 and 60 days prior to renewal.
Missouri HB 2536—House Bill 2536 required businesses to present the terms of automatic renewal contracts in a clear and conspicuous manner, provide consumers with an acknowledgement with the terms of the automatic renewal provision and cancellation policy, and receive consumers’ affirmative consent before charging them for continuation of service. IHRSA submitted testimony in opposition to this bill. It did not make it out of committee.
Virginia HB 911—The Virginia General Assembly approved House Bill 911, which requires businesses that make automatic renewal offers present the terms of automatic renewal offer in a clear and conspicuous manner and receive the consumer’s affirmative consent before charging the consumer for continuation of service. Because of IHRSA’s direct advocacy efforts, health clubs were granted an exemption to HB 911.
West Virginia SB 368—Senate Bill 368 required businesses making automatic renewal offers to present the terms of the offer in a clear and conspicuous manner, obtain the consumer’s affirmative consent before charging them for continuous service, remind the consumer at least 30 days before the contract was scheduled to renew, and inform the consumer how to cancel the continuous service offer in a manner that could be retained by the consumer. SB 368 also imposed additional notification requirements for businesses making free trial offers that automatically renew. IHRSA submitted testimony in opposition to SB 368 after it passed the Senate and started a grassroots advocacy campaign to engage our West Virginia members. It did not pass in the House and will not carry over to the 2019 legislative session.
Wyoming SF 38—IHRSA tracked Senate File 38, which required that businesses utilizing contracts with automatic renewal provisions causing the contract to be enforceable for more than 6 months to:
- Inform the consumer of the automatic renewal provision in a clear and conspicuous manner, using understandable language;
- Notify the consumer between 30 and 90 days before the consumer may cancel the contract.
Senate File 38 also required that businesses utilizing contracts with an automatic renewal provision providing for a renewal term exceeding 12 months display the provision on the first page of the contract. SF 38 was defeated in the Senate Corporations Committee shortly after IHRSA submitted testimony in opposition to it.
PENDING
New Jersey SB 2326—Senate Bill 2326 was introduced in 2018 and is active during the 2019 legislative session. It requires businesses that utilize automatic renewal contracts to clearly and conspicuously disclose the terms of the automatic renewal contract, notify the consumer between 30 and 60 days before the contract is scheduled to renew, and inform the consumer that the contract will automatically renew unless the consumer cancels it. IHRSA will continue to monitor the bill in the new legislative session.
DEFEAT
Vermont H.593—On May 28, House Bill 593 passed into law without Governor Phil Scott’s signature. H.593 requires that businesses utilizing automatic renewal contracts that renew for a period of more than one month disclose the terms of the automatic renewal provision in a clear and conspicuous manner, receive the consumer's affirmative consent before allowing the contract to renew automatically, and notify consumers before the automatic renewal date or the date by which the consumer must provide notice to cancel the continuation of service. IHRSA submitted testimony in opposition to this bill and was in contact with members of the House Committee on Commerce and Economic Development and the Senate Committee on Economic Development, Housing and General Affairs throughout the legislative session. H.593 goes into effect on July 1, 2019.
Consumer Protection
IHRSA supports consumer protection legislation that safeguards the public against fraud, deceit, and financial hardship while fostering and encouraging competition, fair dealing, and prosperity in the health and fitness industry.
VICTORY
Massachusetts HB183—House Bill 183 would have allowed those who become disabled for longer than three months to suspend their memberships. IHRSA was concerned that because the law did not include any limits on reinstatement, that consumers could abuse the system and attempt to reinstate their membership years later. IHRSA’s lobbyist met with the sponsor and IHRSA submitted testimony voicing our concerns, and ultimately the bill did not advance.
Illinois HB 4275—IHRSA, working with Steve Schwartz of Midtown Athletic Club and other club operators within the state, was able to pass House Bill 4275, repealing the cap on what operators could charge for membership fees. The maximum cap on membership fees of $2,500 a year had not been changed in more than 40 years. The bill also reduced the initial term of a service contract to one year, down from the previous two-year max.
Personal Trainer Regulation
IHRSA works to ensure that legislation does not limit a club's access to qualified personal trainers, or make fitness services more expensive and difficult to acquire for consumers.
VICTORY
Louisiana HB 748—IHRSA monitored and communicated with the sponsor of House Bill 748, which aimed to change the definition of “licensed” personal trainers within the state and restricted the use of the term “certified." Following IHRSA’s efforts, the problematic language was removed.
Nebraska LB 299—Originally this allowed for the creation of an occupational board to regulate personal trainers (among other professions) via licensing and registration. IHRSA submitted written testimony to the Committee on Government, Military, and Veterans Affairs, prompting lawmakers to remove language concerning regulations for personal trainers. The governor signed LB 299 after lawmakers passed it in the final day of the 2018 session.
Bonding
IHRSA opposes bonding legislation that creates an undue burden on club businesses, while failing to safeguard the consumer.
VICTORY
Hawaii SB 2770—At the request of the governor, legislators in Hawaii were determined to pass a bill requiring club operators to maintain a $100,000 bond, regardless of length of business or fiscal health. IHRSA repeatedly submitted testimony to stop this harmful legislation and prevailed when the differences between the House and Senate versions of the bill could not be resolved.
Sales Tax
IHRSA opposes taxes on health club memberships and services. IHRSA believes that government should encourage regular exercise and healthy lifestyles, not discourage them by taxing health club memberships and services.
BUILDING MOMENTUM
Connecticut HB 5019—After speaking with the bill’s sponsor, IHRSA determined that the bill was intended to exempt health club membership dues from the sales tax. The bill did not. IHRSA worked with the bill’s sponsor to amend the bill, which ultimately did not make it past the committee stage. IHRSA will revisit the idea of a sales tax rollback on membership dues with the lead sponsor in the coming session. It is estimated that repealing the state sales tax applied to health clubs in Connecticut would save each club $45,000 per year (based on industry research).
Washington SB 6501—To address public health concerns, particularly obesity and diabetes, Senate Bill 6501 would have excluded fitness services and activities from the state sales tax. Unfortunately, this bill did not advance and the sponsor has since retired, IHRSA is working on finding a new sponsor for 2019. It is estimated that repealing the state sales tax applied to health clubs in Washington would save each club $46,000 per year (based on industry research).
VICTORY
California SB 993—Senate Bill 993 would have required businesses pay a sales tax on the purchase of services, adding a sales tax on business-to-business service transactions. The bill would have exempted certain types of services, including health care services, and businesses with gross receipts of less than $100,000 in the previous four quarters. IHRSA alerted members to the bill, which received a hearing but otherwise did not advance out of committee.
Louisiana HB 19—House Bill 19, would have applied the state’s 5% sales tax to a long list of services, including massage parlors and steam baths. IHRSA contacted the sponsor who indicated a willingness to clarify that the bill was not intended to apply to health clubs that offered massage. The bill did not advance out of committee.
Georgia HB 543—Dubbed the “FairTax Act,” the bill would have eliminated all sales tax exemptions and expanded the sales tax to services, likely health club memberships and fitness services. This bill did not advance from committee. It is estimated that it would cost each club in Georgia approximately $23,000 per year if the state sales tax applied to health clubs (based on industry research).
Pennsylvania SB 76—A push to eliminate property taxes statewide continues to drive proposals to expand the sales tax to make up for the potential lost revenue. Senate Bill 76 proposed a 7% tax on health club membership and services. IHRSA and Pennsylvania health clubs have been actively opposing this legislation for multiple sessions. It would cost each club in Pennsylvania approximately $35,000 per year if the state sales tax was applied to health clubs (based on industry research).
Washington SB 5937A—The bill proposed a sales tax exemption for membership at CrossFit facilities, as long as the facility has 300 or fewer members. IHRSA’s position is that a sales tax repeal should benefit all fitness consumers. The bill did not progress out of committee. However, following outreach from IHRSA, the sponsor subsequently filed SB 6501, which would have repealed the sales tax on fitness services and activities.
Nebraska LB 312 and LB 1084—Though membership dues are already subject to the state sales tax, services, such as personal training, are not currently taxed. Two proposals, Legislative Bill 312 and Legislative Bill 1084, would have expanded the sales tax to instruction in recreational activities (in addition to music and golf), which would have impacted group fitness and personal training. IHRSA submitted testimony in opposition to both measures. Ultimately, LB 312 did not advance from committee, nor did LB 1084 despite several amendments to the bill. It is estimated that repealing the state sales tax applied to health clubs in Nebraska would save each club $39,000 per year (based on industry research).
Ohio HB 177—Members of the Ohio House introduced legislation that would repeal the sales tax on non-profit fitness facilities. IHRSA’s position is that a sales tax repeal should benefit consumers at all fitness facilities. IHRSA and Ohio member clubs provided testimony in opposition and the bill did not make it out of committee.
West Virginia SB 125 and SB 123—After fighting off ten pieces of legislation, threatening the current sales tax exemption for fitness memberships, in 2017, IHRSA and West Virginia clubs faced two additional sales tax proposals in 2018. Senate Bill 125, proposed eliminating the fitness sales tax exemption, while Senate Bill 123, proposed eliminating the fitness sales tax exemption and dedicating the resulting revenue to veterans’ programs and volunteer fire departments. IHRSA submitted testimony in opposition to both proposals and neither made it out of committee, saving the average health club approximately $38,000 per year.
Wyoming—Though the Wyoming Legislature was out of session, the Interim Joint Committee on Revenue met and created draft legislation that would have made amusement and recreation services—including dance studios, schools and halls, bowling centers, physical fitness centers, public golf courses, and sports clubs—subject to the state sales tax beginning July 2018. IHRSA contacted the committee and submitted testimony in opposition to the draft bill. The committee elected not to advance the bill. IHRSA estimates the bill would have cost each club $28,000 per year, based on industry data and a 4% sales tax.
Tennessee HB 1736 and SB 1751—Currently, Tennessee health clubs are exempt from the sales tax if certain conditions are met, such as having at least 15,000 square feet of facility space. House Bill 1736 and Senate Bill 1751 would have replaced the exemption rules, offering exemptions only to certain types of nonprofit facilities. IHRSA and its members testified in opposition to the change and proposed that all fitness facilities be exempted from the sales tax. SB 1751 was reported out of committee, but did not receive a vote in the Senate, while HB 1736 did not make it out of committee. If passed, removing the exemption would have cost clubs $49,000 per year.
DEFEAT
Kentucky HB 366—In the 11th hour of Kentucky’s 2018 legislative session, lawmakers introduced and passed a tax reform package that expanded Kentucky’s 6% sales tax to 17 select services, including health club memberships. The bill was written over a weekend, introduced and passed on the following Monday without any public hearing or comment. Governor Matt Bevins vetoed the bill but it was overridden. In addition to expanding the sales tax, the bill eliminated tax brackets and levied a flat 5% tax on individuals and corporations. It is the largest change to Kentucky’s tax code since 2005.
