BOMA International Advocacy Update - Fiscal Cliff Averted, Energy Tax Incentives and Lead Paint Safety

BOMA Priority Issues Pass Congress as Fiscal Cliff is Avoided

Congress passed legislation to address the looming tax increases and spending cuts scheduled to go into effect starting in 2013. On New Year’s Day, the American Taxpayer Relief Act was passed, which, among other items, addressed two key issues for BOMA International and its members: The bill extended for 2012 and 2013 the 15–year timeline for depreciating leasehold improvements, a policy that had expired at the end of 2011; the measure also permanently enacted a 15–percent tax rate on capital gains for those individuals with taxable income below $400,000 and for couples earning under $450,000. Those with income over those levels will pay 20 percent on capital gains. The bill also raises tax rates for these higher income earners from 35 to 39.6 percent, but keeps the lower President George W. Bush–era rates for all others.

Other notable elements of the bill include a permanent patch to the alternative minimum tax (AMT), a permanent extension of the estate tax exemption amount at current levels and a two–month delay of the automatic spending cuts enacted in 2011 known as sequestration. Congress failed to include an extension of the payroll tax holiday, which was in effect the past two years.


Senate Holds Hearing on Energy Tax Incentives

On December 12, the Senate heard testimony on tax proposals to promote energy efficiency. Legislation to extend and improve the 179D tax provision for energy efficient retrofits was one of the bills discussed. The measure would increase the maximum available deduction for new construction from $1.80 to $3.00 per square foot, and up to $4.00 per square foot for retrofits to existing buildings. This new legislation also allows for energy savings to be calculated based on the building’s own pre–retrofit baseline instead of comparing it to a reference building that meets the ASHRAE 90.1 Standard.

Despite the fact that the committee held the hearing during the 112th Session of Congress, it was largely a placeholder for the 113th Session and legislation will need to be reintroduced. Unfortunately, the bill’s two main co–sponsors, Sens. Jeff Bingaman (D–N.M.) and Olympia Snow (R–Maine), have retired. BOMA and our coalition partners are actively engaged in identifying potential co–sponsors in both the Senate and the House to carry this issue forward in the 113th Session of Congress.


EPA Announces Public Hearing on Lead Paint Rulemaking

Under a settlement agreement between the U.S. Environmental Protection Agency (EPA) and the Sierra Club and other environmental and children’s health advocates, EPA agreed to either sign a proposed rule covering renovation, repair and painting activities in public and commercial buildings, or determine that these activities do not create lead–based paint hazards by July 1, 2015. On December 31, EPA announced its plans to hold a public meeting on the issue on July 26, 2013 and solicited public comments due April 1, 2013, as the next part of that process.

EPA is specifically looking for information concerning: the manufacture, sale and uses of lead–based paint after 1978; the use of lead–based paint in and on public and commercial buildings; the frequency and extent of renovations on public and commercial buildings; work practices used in renovation of public and commercial buildings; and dust generation and transportation from exterior and interior renovations of public and commercial buildings. BOMA plans to submit comments and more information will be forthcoming. If you or your company has any information that would assist in this process, please contact Karen Penafiel at kpenafiel@boma.org.