By Mark Valentini, Director of Legislative Affairs
On Monday, Nov. 15, President Biden signed into law HR3684, the Infrastructure Investment and Jobs Act (more commonly known as the Bipartisan Infrastructure Framework, or “BIF”). The bill includes over $110 billion for water infrastructure and building resiliency projects with the potential to put PHCC contractors to work, in addition to $73 billion to reinforce the national energy grid, $5 billion for western U.S. water storage to mitigate the effects of the ongoing drought, and $50 billion for climate resiliency projects that in part would build or reinforce dams and levees for flood mitigation. Half of the overall cost of the bill is expected to go toward surface transportation projects such as roads and bridges. The large investment is expected to spark a construction boom that could help the U.S. economic recovery.
The BIF passed the Senate in early August on a bipartisan 69-30 vote; upon arrival in the House of Representatives, House Speaker Nancy Pelosi attempted to use the legislation as leverage to pass her party’s other legislative priorities encompassed in a separate bill, the $1.75 trillion Build Back Better plan. The strategy did not have the intended result: while “BIF” waited for final passage in the House, debate on the Build Back Better plan dragged out for three months as negotiators attempted to reach an agreement that would gain the support of moderate Democrats uneasy about the bill’s original $3.5 trillion price tag. As that debate continued, the Biden administration suffered a significant drop in public opinion polls while Democrats took major losses in gubernatorial races in Virginia and New Jersey that highlighted a disconnect with voters on key issues. President Biden eventually put pressure on House Democrats at the last minute, needing a much-needed legislative victory in the wake of recent election losses. The BIF passed the House on a 228-206 vote on Nov. 5, sending it to the President for his signature on Nov. 15.
Build Back Better Plan Passes the House
The Build Back Better plan passed the House of Representatives on Nov. 19. However, in light of Democrats’ election losses and dismal outlook going into the 2022 midterms, in addition to economic fears as inflation sets in, there is a diminished appetite to pass the spending bill in the Senate even though it’s original $3.5 trillion pricetag has been whittled down by roughly $2 trillion during negotiations. The Congressional Budget Office scored the bill’s cost at approximately $367 billion over ten years, accounting for $1.63 trillion in spending and $1.26 trillion in revenue offsets. However, that estimate does not take into account whether certain programs slated to expire are extended or made permanent, which could add hundreds of billions more to the bill’s cost.
With the Senate planning to vote on Build Back Better after Thanksgiving, it is expected to make further amendments to the bill with the hopes of placating Senator Joe Manchin (D-WV), the lone holdout in his party who continues to have reservations in light of the negative economic outlook. The bill includes a number of provisions that could impact PHCC contractors, including:
- Four weeks of paid family/medical leave for employees;
- Mandatory participation in employer-sponsored retirement plans;
- Tax changes and increases, including a possible rollback of the estate tax to pre-2017 levels, increases in the top individual and corporate rates, elimination of the 20% pass-through deduction for small businesses, and methane fees imposed on oil and gas producers that will increase the cost of natural gas for consumers and disincentivize its continued use; and
- Restrictions on qualification for tax incentives for commercial building owners that could deter them from making improvements to HVAC systems.
Passage of the bill is not guaranteed to have Manchin’s support and if it does, it could be whittled down enough to lose support of progressives in the House with removal of paid leave provisions and other social programs. While the Build Back Better plan’s future remains in limbo, it is no time to sit back. If you haven’t already, click here to tell the Senate to voice your opposition to proposed new taxes and tax increases or follow this link: https://igniteadvocacy.com/go/tell-congress-no-tax-hikes-on-p-h-c-contractors-/250
PHCC will keep you informed as legislative developments occur.
