President Trump Unveils Federal Budget Blueprint for FY 2018; ENERGY STAR Among EPA Programs Slated for Cuts
President Donald J. Trump unveiled his first federal budget blueprint on Thursday for the next fiscal year starting October 1, reflecting his intentions to reduce the size of the federal government by cutting budgets across agencies and slashing the size of the federal workforce.
Trump stated the reasoning for his suggested budget is driven by the importance of national security and public safety, with a 54 billion dollar increase in defense spending to rebuild the nation’s military without adding to the federal deficit (as offset by reductions in other discretionary spending).
Both Republicans and Democrats expressed initial resistance against Trump’s proposed budget stating it would not pass Congress in its current form. (E.g.: “Trump Budget Likely to See Major Rewrite in Congress,” (Wall Street Journal, March 16); "Republicans Pan Trump Budget," (POLITICO, March 16)). Annual White House budget requests are historically only used as guidance for Congress which “controls the power of the purse” and must ultimately enact bills and funding measures for federal spending. (The Hill, March 16)
Among the departments proposed to take the biggest hits: The Environmental Protection Agency (EPA) with a 31 percent decrease, the State Department with a 29 percent decrease, and the Agriculture and Labor Departments with 21 percent decreases in their respective spending budgets.
Departments and agencies that will receive overall cuts could receive funding boosts for defense capabilities. For example, the Energy Department would receive more money to maintain the nation’s nuclear weapons system even as its science and climate-related programs are cut.
According to USA Today (March 16, 2017), House Speaker Paul Ryan (R-WI) described the plan as a "blueprint," praising its goals but not endorsing it in total. "We are determined to work with the administration to shrink the size of government, grow our economy, secure our borders, and ensure our troops have the tools necessary to complete their missions," Ryan said. "I look forward to reviewing this with the Appropriations Committee and our entire conference.”
While the budget did not provide any information regarding Trump’s potential infrastructure plan, White House budget director Mick Mulvaney said a full budget would be released in May which will contain the president’s plan for Medicare and Social Security, along with 10-year projections for taxes and spending.
Trump Proposes De-Funding ENERGY STAR
Of notable concern to CRE is Trump’s budget proposal to de-fund EPA’s ENERGY STAR program – a voluntary public-private partnership that encourages real estate industry leaders to achieve and be recognized for high energy efficiency performance in their assets.
"The voluntary ENERGY STAR buildings program creates jobs," says Anthony E. Malkin (Chairman and CEO, Empire State Realty Trust)
Over 44 billion square feet of U.S. commercial floor space—50 percent of the market—use ENERGY STAR’s online tool to measure and track energy and water use as a key platform that saves buildings and businesses billions of dollars each year. To attract investors and tenants, many Roundtable members strive to earn the well-recognized ENERGY STAR building label to distinguish their assets as top performers in the marketplace.
"The voluntary ENERGY STAR buildings program creates jobs, enhances competitiveness, increases energy independence, and saves money for American families and businesses,” said The Roundtable’s Sustainability Policy Advisory Committee (SPAC) Chairman Anthony E. Malkin (Chairman and CEO, Empire State Realty Trust.) “Americans with ENERGY STAR residences receive improved pricing on mortgages, lowering their monthly bills.”
The Energy Department’s "2017 U.S. Energy and Employment Report" noted the importance of construction and manufacturing jobs related to energy efficiency in the U.S. economy, boosted by the ENERGY STAR program. According to the report, 2.2 million Americans are employed, in whole or in part, in the design, installation, and manufacture of energy efficiency products and services, adding 133,000 jobs in 2016. Almost 1.4 million energy efficiency jobs are in the construction industry.
“The ENERGY STAR program spurs innovation and requires skilled American jobs for building design, construction and management, which pay well and deliver investments with attractive payback periods and returns,” Malkin continued. “There are no tax credits, tax deductions, or government hand-outs. This is the sort of program which should be continued and copied, not abridged or undermined in any way.”
In coalition with other real estate groups and industry stakeholders, The Roundtable will make the business case for Congressional appropriators and other policy makers on the importance of the ENERGY STAR program to the U.S. economy and the need for its continued funding.
# # #