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Catherine Treadwell Perry, J.D. Director of Government Affairs
The Ways and Means Committee – Tax Subcommittee is already in full swing and the 2019 agenda is already starting to play out. Last week I attended a S Corporation Association meeting where we concentrated on: 2019 tax policy outlook, death tax, and The Department of Treasury -163J regulation issues.
The Chief Tax Counsel from Ways and Means, Andrew Grossman, briefed the room on Chairman Richard Neal (D-MA) possible legislative agenda. Chairman Neal will most likely be concentrating on retirement issues and infrastructure in 2019. There has already been a hearing on automatic IRA enrollments and there could be a markup on the Retirement Enhancement and Savings Act of 2018, also known as, RESA. There also will be at least two hearings on lower income tax payers and the Tax Cut and Jobs and Act. This will pertain to how the TCJA is structured and an analysis of how efficient it is.
Kathryn Chakmak, who is from the office of Representative Jason Smith (R-MO), spoke about the Main Street Act. This act would give permanence for 20% pass through companies, so that main street businesses can get some of the same benefits as C-CORPs. Right now, they are trying to make this act as bi-partisan as possible. Rep. Smith is also looking for a possible counterpart bill in the senate and is currently exploring possible options. ASA supports and encourages reasonable regulations from Congress and the IRS to implement and make permanent the 20% deduction for pass-through businesses.
The death tax or also known as, estate tax, has also been a hot topic, especially lately. The Tax Cut and Jobs Act (TCJA) didn’t repeal the estate tax, as originally proposed. It did, however, temporarily reduce the potential impact of these taxes. The Death Tax Repeal Act should be reintroduced, once it is made more bipartisan. This would give permanency to the reduced rates of the TCJA. It currently has 37 original co-sponsors and now has 44 co-sponsors. Senator Steve Daines (R-MA) will be taking the lead on reintroducing the bill in the Senate. ASA supports legislation to repeal the Death Tax and will be signing the Family Business Coalition letter in support of the Death Tax Repeal Act. This letter will be sent to Senator John Thune (R-SD) and Congressman Jason Smith (R-MO).
The 163J regulation covers limitation on deductions for business interest expense that companies can write off on their taxes. The new regulations make the expense that you can write off smaller. It is supposed to go into effect in 2022, but the Treasury Department has already started putting this into effect, even though that is not Congresses intent. The ASA Advocacy Team is drafting comments to submit about this issue. You can find the Notice of Proposed Rule Making here. This is also something that SCORP and the National Association of Manufactures is tracking very close.
The ASA Advocacy Team is dedicated to being your voice on The Hill, but we want to hear from you! Please contact Catherine Treadwell Perry, J.D., Director of Government Affairs at firstname.lastname@example.org to let us know what legislative or regulatory issues you are seeing within your company.
- National spending on employer-sponsored health plans reached a record $5,641 per-person in 2017, according to a new report from the Health Care Cost Institute, an increase of 16.7 percent between 2013 and 2017. Between 2016 and 2017, average utilization across sectors increased by 0.5 percent while spending increased by 4.2 percent, and experts attribute some part of the price hikes to the increased consolidation within the industry. (Modern Healthcare)
- The Environmental Protection Agency is considering allowing sales of higher blends of ethanol in gasoline without simultaneously setting limits on biofuel credit trading, restrictions it has told the oil industry it would implement, according to three sources. One source said the limits have been delayed to ensure that the permission for higher ethanol blends is finished "in a timely manner." (Reuters)
- Federal court reverses New York State's denial of Northern Access Pipeline. The long-delayed Northern Access natural gas pipeline expansion regained its footing as the U.S. Court of Appeals for the Second Circuit vacated the State of New York's denial of a key permit that halted work on the project two years ago. The 97-mile pipeline will carry .5 bcf/d from northeastern Pennsylvania to interconnections near Buffalo. The court ruled that the decision by the New York State Department of Environmental Conservation (DEC) to deny a water quality certification for the National Fuel Gas Co. project was baseless. (Toby Mack- EEIA)
- McConnell said he plans to hold a vote on the so-called Green New Deal, a move that could put Democrats on the record as backing a policy agenda Republicans have derided as a "socialist fantasy." The platform has been pushed by Rep. Alexandria Ocasio-Cortez (D-N.Y.) and Sen. Ed Markey (D-Mass.), and has the backing of Democratic presidential hopefuls in the Senate, including Cory Booker, Kirsten Gillibrand, Kamala Harris and Amy Klobuchar. (Politico)
- Congress sent President Donald Trump legislation to avert a government shutdown, including $1.3 billion for border barriers, a fraction of the $5.7 billion he requested for his proposed wall along the U.S.-Mexico border. He signed it Friday.
- Trump said he'll use emergency powers to shift some of the executive branch's funding around, including $3.5 billion Congress approved for military construction, $2.5 billion from the Defense Department's drug interdiction efforts and $600 million from the Treasury Department's drug forfeiture program, according to a source. House Speaker Nancy Pelosi (D-Calif.) accused Trump of "doing an end run around Congress," and Trump's likely to face a lengthy legal battle over presidential powers.
- The Treasury Department called reports of an 8.4 percent drop in average refund amount from the same period last year "misleading" in a tweet. Treasury said refund amounts are consistent with 2017 levels and blamed the year- over- year decline on a small sample size. (The Hill)
- President Donald Trump is weighing pushing back the March 1 deadline for imposing higher tariffs on China imports by 60 days if the United States and China can get close to a trade deal, according to people familiar with the matter. U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin are currently in Beijing for high-level trade talks with Chinese Vice Premier Liu He. (Bloomberg) 2020
- Retired astronaut Mark Kelly announced his candidacy for the Democratic nomination for Senate in Arizona, a race that is expected to be one of the most closely contested in the country next year against Republican Sen. Martha McSally (R). Kelly gained prominence as a gun-control advocate after his wife, former Rep. Gabrielle Giffords (D-Ariz.), was shot in a failed assassination attempt in 2011. (The Associated Press)
- Senate Minority Leader Chuck Schumer (D-N.Y.) is trying to recruit Amy McGrath, an ex-fighter pilot who unsuccessfully challenged GOP Rep. Andy Barr in last year's midterm elections, to run against Senate Majority Leader Mitch McConnell (R-Ky.) in 2020. McConnell's team has been compiling opposition research on McGrath and examined her unsuccessful 2018 bid, and senior Republican officials involved with a pro-McConnell super PAC are set to meet in Washington today to begin mapping out a potential campaign against her. ( Politico)
- Sen. Bernie Sanders (I-Vt.) recorded a video announcing his bid for president, two people familiar with the ad said.
- EPA Says to Regulate Two PFAS Chemicals. EPA announced this week that it will set federal drinking water standards for PFOA and PFOS, two manmade chemicals in a class of toxic compounds that have been found in the water supplies of millions of Americans. (EPA Press Release)
| || NEWS FROM STATE AND LOCAL |
|State Legislative Activity
NOTE: ASA is proud to add this section to the Washington Weekly. We have increased our tracking capabilities down to the State level and will be providing up to date information on state activities going forward.
- New York - S 3698: and Maryland HB 1253: both state bills are looking at requiring testing for the presence of lead in drinking water in school buildings ASA is currently looking at forming a small group to develop a position on this issue so if any ASA members are interesting in participating please contact Jim Kendzel and email@example.com
- Michigan HB 4175 and Kansas SB 171: both legislations update the definition of “lead free” for pipes, pipe fittings, plumbing fittings, and fixtures. ASA has responded to these proposed legislations providing comment on the definition to ensure it is consistent with the current EPA definition for “lead free”.
- Kentucky HB 349: The General Assembly finds and declares that a small business apprenticeship 6 tax credit shall be available to encourage the development of skilled workers 7 through registered apprenticeship training programs in order to counter the 8 current and projected shortage of skilled workers which exists in Kentucky.
- Illinois HB 3658 APPLIANCE EFFICIENCY STANDARDS: Creates the Minimum Energy and Water Efficiency Standards Act. Provides that the Agency shall adopt rules establishing minimum efficiency standards for the types of new products. Provides that the rules shall provide for specified minimum efficiency standards. Provides specified dates for the implementation of efficiency standards relating to particular products. Provides that the Agency may adopt new rules increasing efficiency standards. Provides protection against repeal of federal standards. Provides penalties for noncompliance with the Act. Provides that the Act's provisions are severable
- Illinois HB3445 Lead Service Line Replacement – Proposed bill requires community water supplies to identify and replace all lead service lines that connect to a water main. Provides that every community water supply in Illinois that has known lead service lines shall create a plan, to be submitted to the Environmental Protection Agency for approval, to replace all lead service lines and galvanized service lines if the service line is or was connected to lead piping. Effective immediately.
- The House and Senate are not in session.
- The United States and China will continue trade talks in Washington this week.
- The ASA Advocacy Team will be attending the monthly High Performance Building Coalition meeting on Friday.
President Donald Trump said he’s open to extending a March 1 deadline to raise tariffs on Chinese products if the two sides are near an agreement, sending a conciliatory signal amid talks to resolve the trade war between the world’s two biggest economies. “If we’re close to a deal where we think we can make a real deal and it’s going to get done, I could see myself letting that slide for a little while,” Trump told reporters during a cabinet meeting Tuesday. “But generally speaking I’m not inclined” to delay raising tariffs, he added.
Senator Elizabeth Warren issued a pointed campaign finance challenge to fellow Democratic U.S. presidential contenders at her official 2020 White House election launch. “I’m not taking a dime of PAC money in this campaign. I’m not taking a single check from a federal lobbyist. I’m not taking applications from billionaires who want to run a Super PAC on my behalf. And I challenge every other candidate who asks for your vote in this primary to say exactly the same thing,” Warren said during her rally last Saturday in Massachusetts.
Senate Minority Leader Chuck Schumer met with former Texas Rep. Beto O’Rourke last week to discuss a possible 2020 Senate campaign against GOP Sen. John Cornyn, according to a source familiar with the meeting.
O’Rourke, a Democrat who lost narrowly against Sen. Ted Cruz in 2018, is considering running for president and hasn’t publicly discussed running for Senate in 2020. But he also hasn’t ruled it out.
Prominent Democrats have rushed to embrace the "Green New Deal" — and Republicans couldn't be happier about it.
As liberal groups pressure presidential candidates and lawmakers to back the ambitious climate proposal, Republicans hope their opponents drift so far left that they will be vulnerable in 2020. Since the election of President Donald Trump — who dismisses the link between carbon emissions and rising temperatures — Republicans have steered clear of climate change, but in the Green New Deal they see a chance to pivot the argument back toward economics as growing majorities accept the underlying science.
Rep. Alexandria Ocasio-Cortez (D-N.Y.) and Sen. Ed Markey (D-Mass.) released a blueprint for a Green New Deal on Thursday, urging a "10-year national mobilization" for a speedy shift away from fossil fuels and calling for national health care coverage and job guarantees in a sweeping bid to remake the U.S. economy.
The burgeoning left-wing faction within the Democratic Party quickly persuaded several 2020 White House contenders to sign onto the Green New Deal’s tenets in a bid to push climate change and the broad economic platform up the ladder of party priorities.
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