Senate Debates Stimulus Package – Final Vote Coming Soon
The U.S. Senate is struggling to finish its work on its nearly $900 billion version of the American Recovery and Reinvestment Act of 2009, with a vote expected by the end of the week. The U.S. House of Representatives passed its $819 billion version by a vote of 244 to 188 on January 28 with no Republican support. Senate debate on the package has been largely partisan where neither party holds enough seats to guarantee passage. As a result, a bipartisan group of Senators is working with the Obama Administration to craft a compromise which would eliminate more than $50 billion in “wasteful” spending proposed in the bill. At the same time, Senate Majority Leader Harry Reid (D-Nev.) believes there are enough votes to pass the measure as early as Thursday evening.
While differing from the House version in cost, the Senate version is largely similar in the spending and tax provision it proposes. Both bills, for example, recommend over $150 billion in federal construction spending and authorize nearly $50 billion in new and existing bonds to finance infrastructure projects. The Senate version, however, includes a costly provision to “patch” the alternative minimum tax (AMT) for 2008 at a cost of about $70 billion. It also includes an amendment that would increase the $7,500 first-time homebuyer credit to as much as $15,000 for any home purchased in 2009 and remove the repayment requirement. In addition, the Senate passed an amendment to paper over free trade concerns regarding the “Buy American” requirements in the bill, but did not approve an amendment to remove the controversial provision.
The House and Senate must still negotiate a final package and pass it before presenting it to the President for his signature. We strongly urge you to reach out to your employees, your suppliers, your subcontractors and your state and local community leaders to ask them to use the tools on the AGC Web site to contact their Senators and Representatives. Urge your members of Congress and Senators to add additional infrastructure investment to the bill. For more information on the economic stimulus proposals and to contact Congress, visit www.agc.org/stimulus.
Highlights of the Senate Stimulus Package:
• Highway and Transportation Funding: Over $47 billion for transportation infrastructure, including $27.1 billion for the federal-aid highway program; $5.5 billion for competitive surface transportation grants (new program); $8.4 billion for transit; $3.1 billion for Amtrak and high-speed rail; and $2.5 billion for airport improvements.
• Building Infrastructure Funding: Over $58 billion for building infrastructure repair, renovation, and construction, including $9.3 billion for the General Services Administration; $6.3 billion for Military Construction; $3.4 billion for Veterans Affairs construction; and $20 billion for public school and higher education construction.
• Water and Environmental Infrastructure: Over $24 billion for water and environmental infrastructure, including: $4 billion for the Clean Water State Revolving Loan Fund (SRF) program; $2 billion for the Drinking Water SRF; $1.4 billion for U.S. Department of Agriculture rural water grants and loans; $4.6 billion for the Corps of Engineers; $1.4 billion for the Bureau of Reclamation; and $6.4 billion for former weapon production and energy research site cleanup.
• Tax Provisions: One-year deferral of the 3 percent withholding tax on government contractors; a 5-year carryback of net operating losses; extension of small business expensing and 50 percent bonus depreciation; a tax credit bond option for states and local governments; extension and increase in unemployment benefits; temporary suspension of taxation on unemployment benefits.
Other provisions in the bill:
• Davis-Bacon Requirements: Any projects funded directly or assisted in whole or in part by and through the federal government will have Davis-Bacon wage requirements. In addition, the bill calls for the application of Davis-Bacon to any projects funded by tax bonds.
• Buy American: The bill mandates that iron, steel and manufactured goods used in the construction and repair projects funded under the bill be produced in the United States. The provision “shall be applied in a manner consistent with United States obligations under international agreements.”
• Federal Contracting Requirements: The House bill would apply the Federal Acquisition Regulation (FAR) to contracts awarded with stimulus funds where pre-existing contracting regulations do not exist. The Senate bill does not contain a similar provision.
• E-Verify: The House bill contains language that would make any contractor who receives funds through the stimulus to use the E-Verify electronic verification system. The Senate bill does not have this provision, although an amendment could be offered that would make the same requirement.
For more information, contact Jeff Shoaf at (703) 837-3350 or firstname.lastname@example.org.
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