Government Funding Deadline Extended to Dec. 18 as Pandemic Relief Package Proposals Face “COVID Cliff”
Congress this week extended government funding until Dec. 18 to avert a government shutdown and give bipartisan negotiators more time to finalize a pandemic relief bill, which remains at an impasse over business liability and state and local government aid provisions. President Trump is expected to approve the one-week spending bill before current funding expires tomorrow. (CNBC, Dec. 11)
- Policymakers engaged in intense pandemic aid negotiations also face the expiration of unemployment and housing benefits scheduled at the end of this month. This “Covid cliff” includes the Dec. 31 expiration of a national eviction moratorium by the Centers for Disease Control. (CNBC, Dec. 4 and The Hill, Dec. 9)
- House Speaker Nancy Pelosi (D-CA) and Senate Majority Leader Mitch McConnell (R-KY) recently signaled their goal was to combine a 2021 fiscal year spending bill with pandemic relief as part of a massive “omnibus” bill this month before recessing. (Politico, Dec. 4)
- McConnell this week backed a $916 billion GOP pandemic aid proposal released Dec. 8 by Treasury Secretary Steven Mnuchin, while Democratic leaders support a $908 billion proposal issued by a bipartisan group of lawmakers last week. (BGov, Dec. 10)
- The bipartisan coalition on Dec. 9 released details on its $908 billion stimulus proposal that includes $25 billion for residential rental assistance, state and local aid, augmented unemployment insurance benefits, a scaled-down Paycheck Protection Program (PPP) – as well as money for vaccine development, supply, and testing and tracing programs. (Framework summary for details on the bipartisan Emergency COVID Relief Act of 2020, Dec. 9)
- Although the dueling relief plans are close in total costs, significant policy differences over business liability and state and local government aid threaten the completion of negotiations. (Wall Street Journal, Dec. 9)
- The bipartisan group reportedly agreed this week on a needs-based formula to distribute $160 billion in state and local aid, but will not release details until compromise language addressing liability is finalized. (CQ, Dec. 9 and BGov, Dec. 10)
- Sen. Chris Coons (D-DE) on Dec. 9 said that emerging liability language may include a six-month moratorium on coronavirus-related lawsuits that would give states time to develop their own protections. An "affirmative defense" provision may also be included to counter excessive claims against institutions subject to lawsuits. (Roll Call, Dec. 9)
Pelosi yesterday suggested that discussions over the emergency legislation could now stretch beyond the holiday season. “If we need more time, then we take more time. But we have to have a bill and we cannot go home without it,” Pelosi said. “I would hope that it would honor the December 18th deadline ... We’ve been here after Christmas, you know.” (Business Insider, Dec. 10)
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Bipartisan House Bill Would Spur Energy Efficiency Upgrades in Commercial and Multifamily Residential Buildings
New legislation introduced this week by House Ways and Means Committee members Brad Schneider (D-IL) and Tom Rice (R-SC) would accelerate depreciation for high performance upgrades in commercial and multifamily buildings – creating new jobs in the construction, design, and energy sectors; boosting equipment manufacturing; and reducing the built environment’s carbon footprint. (Rep. Schneider news release, Dec. 9)
- The Energy Efficient Qualified Improvement Property (E-QUIP) Act proposes the establishment of an elective 10-year, straight-line cost recovery period for a new category of E-QUIP expenditures that meet strict energy efficiency criteria. The E-QUIP benefit would apply to “above code” heating and cooling equipment; lighting; building shell components (e.g., roofs, insulation, and windows); and “smart controls” (e.g., web-enabled thermostats, occupancy and daylight sensors) – as long as they are installed through 2025.
- Real Estate Roundtable President and CEO Jeffrey D. DeBoer helped to launch support for the E-QUIP Act during a Dec. 8 virtual meeting led by Reps. Schneider and Rice that reached a spectrum of stakeholders representing environmental, manufacturing, and real estate organizations.
- “The E-QUIP Act checks all of the boxes for smart energy, climate, and economic policy,” DeBoer said. “Installation of high performance HVAC, lights, windows, and other building components will modernize aging buildings, save businesses billions of dollars on their energy bills, create tens of thousands of jobs, and avoid carbon emissions equal to taking 22 million cars off the road for a year. The E-QUIP Act can also encourage state-of-the-art retrofits that enhance outdoor air ventilation rates — a key practice to improve a building’s health and indoor air quality, according to the best available science.”
- The Roundtable and numerous other stakeholders wrote to congressional tax writers last year about the need to establish an accelerated depreciation schedule for E-QUIP. (Coalition E-QUIP letter, May 8, 2019)
The American Council for an Energy-Efficient Economy (ACEEE) released research this week estimating the E-QUIP Act’s economic and environmental impacts would include:
- 130,000 net additional job-years
- $15 billion energy bill savings
- 100 million tons of carbon dioxide emissions avoided – or the equivalent emissions from 560,000 rail cars full of coal, or taking 22,000 cars off the road for one year. (ACEEE’s E-QUIP policy brief and fact sheet)
- “Many building owners want to make energy efficiency investments, but existing law disincentivizes them. This fix will help them upgrade from old equipment to state-of-the-art options that will reduce their energy bills while cutting carbon emissions,” said ACEEE Executive Director Steven Nadel in a press release.
- Most investments in existing commercial and multifamily buildings are currently ineligible for the immediate tax deductions available to other business investments under the 2017 Tax Cut and Jobs Act. Instead, they are subject to depreciation periods as long as 40 years, depending on the kind of building, whether the investments affect the interior or exterior, and the tax status of the owner.
- The current patchwork of depreciation periods is largely unrelated to the useful lifetime of the investments. The new E-QUIP proposal would apply uniform criteria to an elective 10-year depreciation period.
- The Roundtable and other supporters aim to undertake a coordinated advocacy effort to identify additional House sponsors for the bill, and support introduction of companion legislation in the Senate.
The E-QUIP Act will be discussed in greater detail at the “virtual” meetings of The Roundtable’s Tax Policy Advisory Committee (TPAC) and Sustainability Policy Advisory Committee (SPAC) on Jan. 27.
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Roundtable President and CEO Jeffrey DeBoer Recognized for Third Consecutive Year as One of the “Top Lobbyists” in Washington, DC
The prominent policy news publication The Hill this week recognized Real Estate Roundtable President and CEO Jeffrey DeBoer as one of the Top Lobbyists in Washington, DC. This is the third consecutive year that DeBoer has been recognized in the annual list. (The Hill, Dec. 10)
- The Hill’s 2020 recognition acknowledges a variety of industry representatives for their advocacy efforts as “the people who wielded their clout and knowledge most effectively on behalf of their clients.”
- The publication also notes, “The ranks of policy experts and influencers run deep in Washington, but these are the players who stand out for delivering results for their clients in the halls of Congress and the administration.”
- The Roundtable’s DeBoer commented, “It is an honor to be recognized individually, but my inclusion on the list is more reflective of the overall Roundtable organization, its membership and our staff team effort. I am proud to work with highly effective leaders from the commercial real estate industry and with a staff of advocacy professionals who communicate our balanced policy agenda positions to lawmakers and regulators with a fact-based, non-partisan approach.”
- DeBoer added, “I appreciate the consistent recognition by The Hill but I share it side-by-side with our talented membership, staff and others who work on behalf of The Real Estate Roundtable.”
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