To: ASC Member Representatives
From: Mark Collatz, Director of Government Relations
Recently, ASC worked with a coalition of associations to have favorable tax incentives placed in the federal stimulus package, the American Recovery and Reinvestment Act of 2009 (ARRA). While the effort eventually proved unsuccessful, the law firm that handled the negotiations with Capitol Hill put together a description of various provisions that could prove helpful to the to the coalition of associations’ member companies. These provisions will provide massive spending for construction utilizing building products and home furnishings as well as tax incentives and benefits for home purchases, school construction bonds, businesses and vehicle purchases.
To give you some idea of what and where these key provisions, both for spending provisions and tax provisions, I have identified the section in the final legislation. To obtain a copy of the complete final legislation go towww.house.gov.
In the center of the page you will find a link entitled Find a Bill, Amendment or Debate – click on Search Thomas by bill text or number. At the next site click on enrolled bills and submit. The ARRA will be at the bottom of the page. If you have problems getting to the electronic copy of the stimulus package, call me at 301/986-9700 ext. 112
Spending Provisions American Recovery and Reinvestment Act of 2009:
- GAP Financial Proposal
The ARRA provides the HOME Investment Partnership Program with an increase in block grant funding to enable state and local government, in partnership with community-based organization to acquire, construct, and rehabilitate affordable housing and provide rental assistance for poor families. HOME funds will be principally used to jump-start affordable housing projects in desperate need of gap financing due to the collapse of the Low Income Housing Tax Credit (LIHTC) market, and to ensure that vulnerable families obtain and maintain stable housing during the economic downturn. This provision is expected to result in 50,000 units in 2009.
Title XII TRANSPORTATION SND HOUSING AND URBAN DEVELOPMENT
Community Development Fund
home investment partnership fund - Department of Defense Facilities
Billions of dollars are provided for defense facilities including; $1.3 billion for new construction to provide state-of-the- art medical care to service members and their families (Medical Facilities); $4.2 billion to invest in energy efficiency projects and to repair and modernize Department of Defense facilities of which $400 will be used to improve military medical facilities and $153 million will be used to restore Army barracks; $890 million to improve base housing for our troops and families and to provide re-stationing military homeowners; $240 million for new child development centers: $100 million for new construction to support Guard and Reserve units across the country with operations and training facilities and utilities infrastructure: and $150 million Grants for Construction of State Extended Care Facilities.
Title X MILITARY CONSTRUCTION AND VETERANS AFFAIRS - Department of Veterans Affairs
One billion dollars is provided for veterans’ medical facilities repairs, including energy efficiency projects.
Title X MILITARY CONSTRUCTION AND VETERANS AFFAIRS - Federal Buildings
$4.5 billion is provided to the General Services Administration (GSA) for construction, renovations, and repairs of federal buildings and courthouses. Projects are to be selected based upon their ability to be awarded within 120 days so that construction can begin as soon as possible and emphasis is on energy efficiency.
Title V FINANCIAL SERVICES AND GENERAL GOVERNMENT
GENERAL SERVICES ADMINISTRATION - Home Weatherization
$5 billions provided to expand the number of households eligible for assistance under the Department of Energy’s “Weather Assistance Program.” The program provides grants to states to assist low income households with the purchase and installation of materials that improve energy efficiency.
Title IV ENERGY AND WATER DEVELOPMENT
DEPARTMENT OF ENERGY-ENERGY PROGRAMS - Health Care Facilities
Several billion dollars are provided for healthcare infrastructure, including: $500 million, part of which is designated for building Public Health Center health centers; $1.5 billion for renovation and repair existing health centers; $1.3 billion in grants and contracts to renovate or repair existing non-federal, university research centers; and $500 million for National Institute of Health building repairs and improvements.
Title VII INTERIOR, ENVIRONMENT AND RELATED AGENCIES
DEPARTMENT OF HEALTH AND HUMAN SERVICES - Education Facilities
$39.5 billion of the “State Fiscal Stabilization Fund” is designated for distribution by states to local school districts, part of which may be used for school “modernization” and other purposes. Additionally, $8.8 billion is designated to states for high priority needs, including modernization repairs and renovations of public schools and facilities and institutions of higher learning.
Title XIV STATE FISCAL STABILIZATION FUND
DEPARTMENT OF EDUCATION - Federal Buildings
$5.5 billion is provided to GSA for real property activities including construction, renovations and repairs of federal buildings and courthouses and conversion of GAS buildings to High-Performance Green Buildings. Projects are to be awarded based upon their ability to be selected in 120 days.
Title V FINANCIAL SERVICES AND GENERAL GOVERNMNET DEPART OF THE TREASURY
GENERAL SERVICES ADMINISTRATION
Real Property Activities - Department of the Interior-Bureau of Indian Affairs
$450 million is provided for construction, repairs and replacement of schools, detention facilities, roads, bridges, employee housing and maintenance.
Title VII INTERIOR, ENVIRONMENT AND RELATED AGENCIES
Bureau of Indian Affairs - Other
The ARRA includes many other spending provisions, such a $30 billion to states for highway, bridges and transit projects, $8 billion for high speed rail projects, and over $33 billion for various energy efficiency and renewable energy programs, including research and modern electric grid development. Some of these spending provisions may benefit ASC members through calls for additional adhesive and sealants.
- Refundable First-Time Home Buyer Credit
Last year, Congress provided taxpayers with a refundable tax credit that was equivalent to an interest-free loan (for a term of 15 years) equal to 10 percent of the purchase of a home (up to $7,5000) by first time home buyers. The provision would have expired July 1, 2009. The credit phases out for taxpayers with adjusted gross income in excess of $75,000 ($150,000) in the case of a joint return). The ARRA eliminates the repayment of the obligation for taxpayers that purchase a home after January 1, 2009 and increases the maximum value of the credit to $8,000. It expires November 30, 2009.
Subtitle A-Tax Relief for Individuals and Families
PART I GENERAL TAX RELIEF
SECTION 1006 - Five year Carryback of Net Operating Losses
The ARRA includes a provision that allows businesses (with gross receipts of less that $15 million or less) to “carryback” their operating losses in 2008 and 2009 for up to five years, rather than the two year permitted under current law. The provision requires that businesses choosing the longer period reduce their losses by 10%.
Subtitle C-Tax Incentives for Business
PART II SMALL BUSINESS PROVISON - Extension of Bonus Depreciation
Last year, Congress temporarily allowed businesses to recover the costs of capital expenditures made in 2008 faster than ordinary depreciation schedule. Specifically, Congress enacted a provision that would allow businesses to immediately write-off fifty percent of the cost of depreciable property acquired in 2008. ARRA would extend this temporary benefit for expenditures in 2009.
Subtitle C-Tax Incentives for Business
PART I TEMPORARY INVESTMENT INCENTIVES
