Friday, January 9, 2015

BOMA International Advocacy Update - BOMA Scores Win on Leasehold Depreciation and Congress Passes TRIA Reauthorization

BOMA San Francisco Members:

UPDATE - January 9, 2015

BOMA and its partners in the Coalition to Insure Against Terrorism scored a huge win for the commercial real estate industry today with the reauthorization of the federal terrorism risk insurance backstop program, known as TRIA. 

As soon as the 114th Congress convened this week, both chambers made it a priority to quickly put up for vote H.R. 26, the Terrorism Risk Insurance Program Reauthorization Act of 2015. This afternoon, the Senate passed H.R. 26 by a vote of 93-4, following the House’s passage of the same legislation yesterday by an equally overwhelming majority of 416-5. The legislation extends the federal backstop for six years, gradually increasing the loss threshold that triggers federal assistance under the program from $100 million to $200 million. The 113th Congress had allowed the program to expire on December 31, 2014, despite bipartisan support for the issue.

With TRIA extended, BOMA International will now shift its efforts to advocating for certainty in the area of tax policy, as well as practical energy policy that makes sense for the commercial real estate industry and appropriately incentivizes buildings to continue to become more energy efficient.
Original Post - December 14, 2014

Last night, the U.S. Senate approved a package of tax extenders, including a one-year, retroactive extension of the 15-year depreciation period for tenant improvements, which had previously expired at the end of 2013.  This means that building owners can deduct expenses for tenant improvements made in calendar year 2014 over 15 years instead of 39—a significant victory for commercial real estate!

Unfortunately, the Senate failed to extend the federal terrorism insurance backstop program, known as TRIA, which is set to expire on December 31.  Earlier this year, the Senate passed a seven-year extension with overwhelming bipartisan support. Debate on the issue dragged on in the House, and finally, in the Lame-Duck session, the House passed a different version that would have extended the program for six years; the bill then had to go back to the Senate for a final vote.  Unfortunately, it was not a clean bill and contained other provisions that were objectionable to many in the Senate.  TRIA has been a priority issue for BOMA and our real estate partners, and we will work to ensure that this is on the top of the congressional agenda when the 114th Session convenes on January 6.

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