1. House Ways and Means Introduces, Reports Tax Reform 2.0
This week saw the introduction and approval of three bills that collectively build on the growing economic successes of the Tax Cuts and Jobs Act. These bills constitute the legislative package that will be known as “Tax Reform 2.0”. The following bills constitute the Tax Reform 2.0 package:
The Protecting Family and Small Business Tax Cuts Act of 2018
H.R. 6760 makes permanent all the tax breaks for individuals (and therefore S-Corps) in the tax relief from the Tax Cuts and Jobs Act – which included a nearly doubled standard deduction, a doubled Child Tax Credit, lower rates across the board, and a historic 20-percent pass-through deduction for Main Street businesses.
The Family Savings Act of 2018
H.R. 6757is designed to make it easier for businesses to offer multiple employer retirement Savings plans while ensuring workers can easily participate in these plans. Most significantly, it includes the NECA-developed 529 legislation that will allow apprentices with such plans to use them to help offset costs for participating in the apprenticeship.
The American Innovation Act of 2018
H.R. 6756 is designed to increase innovation by simplifying the deduction for start-up firms.
NECA’s Look Ahead:
This legislation, which NECA advocated for since the Tax Cuts and Jobs Act was enacted in December 2017, includes several major priorities for NECA contractors. Most important, it give contractors and employees the predictability of permanent lower tax rates and it includes the NECA-developed 529 language that will help make it easier for apprentices to utilize 529 funds.
2. Additional One-Year Delay of Cadillac Tax Up Next
A package of health care and employer-related bills, including a one-year delay of the “Cadillac Tax,” which would delay it to 2023, is being finalized for a vote on the House floor. In addition to the one-year Cadillac tax delay, the legislation contains a number of provisions related to providing employer relief related to the Affordable Care Act including: changes to the definition of full-time employee, repeal of the tanning tax, employer reporting changes, and retroactive delay of the employer mandate.
NECA’s Look Ahead:
Note that because the bills will be packaged together for one floor vote, Democrats who support individual pieces of the package are not expected to vote in favor of the whole package. Senate action on the package is not expected prior to the mid-term election, but the passage of the additional delay will help make the case for future action in the Senate.
3. Senate and House Leaders Finalize Water Infrastructure Agreement
This week Senate and House leaders announced agreement on a wide-reaching comprehensive water resources and water infrastructure bill. The announced text of the America’s Water Infrastructure Act of 2018 includes four titles (below). Upon agreement, the House swiftly passed the bill on September 13, by voice vote and sent it to the Senate for final consideration.
- Title I authorizes proposed U.S. Army Corps of Engineers civil works activities for port, waterway, flood protection, and other water infrastructure improvements for the country. This title incorporates much of the NECA-supported H.R. 8, the Water Resources Development Act (WRDA) of 2018, which overwhelmingly passed the House in June, as well as key provisions from the America’s Water Infrastructure Act that was unanimously approved by the Senate Environment and Public Works Committee in May.
- Title II seeks to bring greater investment in and modernization of the country’s aging drinking water infrastructure. It also helps facilitate compliance options by our drinking water delivery systems. This title incorporates substantial portions of H.R. 3387, the Drinking Water System Improvement Act, which passed the Energy and Commerce Committee unanimously in July 2017. Key provisions include the authorization of almost $4.4 billion over three years for the state drinking water revolving loan fund program.
- Title III encourages the use of clean, baseload hydropower by streamlining the burdensome regulatory approval process. This title incorporates several NECA-supported bills that passed the House including, H.R. 2880, the Promoting Closed-Loop Pumped Storage Hydropower Act; H.R. 2872, the Promoting Hydropower Development at Existing Nonpowered Dams Act; H.R. 2786,To Amend the Federal Power Act with Respect to the Criteria and Process to Qualify as a Qualifying Conduit Hydropower Facility; as well as key provisions from H.R. 3043, the Hydropower Policy Modernization Act.
- Title IV addresses several NECA-supported stormwater and wastewater infrastructure improvements as it also reauthorizes and strengthens the Water Infrastructure Finance and Innovation Act (WIFIA) program.
NECA’s Look Ahead:
Given the bipartisan nature of this agreement, this bill is expected to pass with significant support. The water infrastructure bill could serve as a legislative vehicle that lawmakers may utilize to help avert or scale back a government shutdown in October.