ASA Washington weekly update

The House and Senate are in session this week.

Congress

A new way forward: On Tuesday, White House staff went to Capitol Hill to hold talks with Republicans on possible bipartisan support for a new infrastructure bill. Republicans had put forth a $568 billion infrastructure bill, which is about 25% of the Biden plan. While Senate Republicans have publicly opposed the size and purpose of the $2.25 trillion Build Back Better proposal, many are now starting to lean towards a larger bill – anywhere from $600-900 billion.

Negotiations: “I would say there is progress, but we still have a ways to go,” said Sen. Shelley Moore Capito (R-WV), who is leading negotiations on the Republican plan. The White House said it was “encouraged” by the discussions. The appears to be some bipartisan agreement on a new surface transportation authorization (read: highways) bill, which needs to be agreed to and signed into law by the end of September. The larger infrastructure bill should have a price tag that both sides are comfortable with, before moving on to details.

Endless Frontier Act: Majority Leader Chuck Schumer (D-NY) and Sen. Todd Young (R-IN) have crafted legislation, reported out of committee this week, to help make the United States more competitive with China. Among other purposes, the bill will direct the Department of Commerce to: “(1) establish a supply chain resiliency and crisis response program to address supply chain gaps and vulnerabilities in critical industries, (2) designate regional technology hubs to facilitate activities that support regional economic development that diffuses innovation around the United States, and (3) award grants to facilitate development and implementation of comprehensive regional technology strategies.”

House GOP leadership: As expected, House Republican Conference Chair Liz Cheney (R-WY) was ousted from her role in a vote last week. She was quickly replaced by Rep. Elise Stefanik (R-NY), who is now the #3 Republican in House leadership, after Minority Leader Kevin McCarthy (R-CA) and Minority Whip Steve Scalise (R-LA).

ASA Federal action

ASA joined, with its Family Business Estate Tax Coalition (FBETC) partners, on a letter to Senate Finance and House Ways & Means Committee leadership. The letter asks Congress to defend the step-up basis on inherited assets in family businesses. “According to a recent EY study, the report forecasts: that 80,000 jobs would be lost in each of the first 10 years and GDP would decrease by $100 billion over 10 years if stepped-up basis were repealed. Additionally, for every $100 of revenue raised by repeal via taxing capital gains at death, $32 would come out of the paychecks of workers.”

Politics

Voting: On Tuesday, House Democrats met for a presentation from Democratic Congressional Campaign Committee (DCCC) Chair Sean Maloney (D-NY) on what went wrong for their caucus in 2020. With President Biden enjoying a 7.4 million vote victory over former President Trump to recapture the White House and their Senate colleagues gaining three seats for the majority, House Democrats lost 11 seats, to hold their current 219-211 majority. Some of the takeaways: Democrats underestimated the number of Trump voters, ‘socialism’ and ‘defund the police’ attacks on Democratic candidates were highly effective and some polling oversampled Democrats, giving a false sense of security in key races.

The next elections for vacant House seats are – Previously Democratic-held: New Mexico’s 1st (6/1), Ohio’s 11th (11/2) and Florida’s 20th (1/11/22). Previously Republican-held: Texas’ 6th District (Special Election Runoff – 7/27) and Ohio’s 15th (11/2). The House now has composition of 219 Democrats to 211 Republicans.

Small Business Administration (SBA)

The SBA is taking Paycheck Protection Program loan applications until May 31, 2021. More can be found here.

ASA State legislative action

ASA joined a broad coalition in California to oppose AB 100, unless amended. This legislation is similar to AB 2060, which ASA and its members defeated last year. The bill currently seeks to: 1.) institute the sale of only endpoint fixtures that comply with the NSF 61 2020 standard starting on January 1, 2022 and 2.) institute a California-specific labeling requirement, among other purposes. The letter asks the author to change the sell by date to January 1, 2024 and revise the labeling requirement to a more uniform standard.