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NUCA Washington Summit
May 8-10 2012
Legislative Report
NUCA of NM Representatives in attendance: Jane Jernigan, NUCA of NM; Burr Dickinson, TLC Plumbing & Utility; Kari Biernacki, AUI Inc.
We had appointments and met with either staff or representative with: Senator Udall, Senator Bingaman, Congressman Heinrich, Congressman Lujan, and Congressman Pearce on 5/9/12.
Issues Discussed and feedback from NM's Delegation
Sustainable Water Infrastructure Investment Act - Requested Action: SUPPORT & Co-Sponsor
- The Sustainable Water Infrastructure Investment Act would allow for significant increases in opportunities for private investment in America's underground environmental infrastructure market by removing water and wastewater projects from under the state volume cap for tax exempt facility bonds (EFBs) or otherwise known as private activity bonds (PABs).
- Current law caps the amount of PABs each state can issue, water infrastructure projects are commonly overshadowed by more attractive infrastructure projects. It is estimated that lifting the cap on these exempt facility bonds would cost the government a modest $354 million over 10 years; it would result in as much as $5 billion annually in incremental private capital for water and wastewater infrastructure projects.
- This bill does not change the public/private relationship and does not privatize the industry, but transfers the risk to private investors while the municipality maintains ownership.
- For every $1 billion spent on water infrastructure, $82 million flows through the state.
- In 1986 the caps were lifted from the solid waste activity bonds and the funding has steadily provided for the industry's needs since.
H.R. 1802 introduced on May 10, 2011. Congressman Lujan is a current sponsor of HR1802. Congressman Heinrich and Pearce indicated interest in supporting the bill but neither has co-sponsored nor confirmed their support. A follow-up letter was sent on 5/15/12 and still no confirmation on their position on the bill.
S. 939 introduced on May 10, 2011. The Senate bill was referred to the Committee on Finance and was incorporated as Section 40205 of the Senate Highway Bill (S. 1813) which passed the Senate by a wide bipartisan margin on March 29, 2012. Both Senator Bingaman and Senator Udall voted Yay on S. 939.
Surface Transportation Reauthorization (Highway Bill) - Requested Action: SUPPORT
- Reauthorization of federal highway and public transportation programs has been on hold since October of 2009, impeding the ability of state departments of transportation to move forward with long-term transportation improvement plans.
- The average distribution of costs on State Highway Contracts is:
- o Aggregates 7%
- o Concrete Pavement 4%
- o Bituminous Pavement 36%
- o Grading/Excavation 10%
- o Drainage 4%
- o Site Preparation 3%
- o Traffic Control 12%
- o Bridge 15%
- o Other 8%
Source: National Highway Construction Cost Index Federal Highway Administration, Office of Highway Policy Information.
- On March 29, 2012 the Senate passed a full two-year reauthorization bill (S. 1813) by a wide bipartisan vote of 74-22. The Senate bill includes language to remove the cap on private activity bonds for water and wastewater projects. On March 30, 2012 President Obama signed a 90-day extension of current highway and public transportation programs into law (PL 112-102) -These short extensions have been happening since October 2009.
H.R. 4348 - Both Congressman Lujan and Congressman Heinrich voted NO on this bill. They both referred to an oil and gas provision in the bill as reason for voting against it. Congressman Pearce voted for the bill but said that some proposed changes in the Senate might result in a Nay vote when it comes back to the House.
S 1813 Both Senator Bingaman and Senator Udall voted for S. 1813 which includes the PAB provision.
Bush Tax Cuts Expiration - January 1, 2013 (Taxmageddon)
- Taxmageddon: a list of expiring tax policies that would result in an unprecedented $494 billion tax increase on Americans in 2013 alone. Taxmageddon means reduced marginal tax rates for millions of Americans and included an increase in the Child Tax Credit and a reduction in the marriage penalty. Thus, the tax increases of Taxmageddon would adversely affect Americans at all income levels, not just "the rich." Other provisions expiring include the payroll tax cut, alternative minimum tax patch, and a series of tax extenders. Eighteen tax hikes under Obamacare, totaling $23 billion, will strike in 2013 as well.
- Each NM Representative was fully aware and concerned about the expiring tax cuts on January 1 2013. It was related that Congress will have to do something before the end of the year even if it is a temporary extension.
- If Congress does not act Dividend Taxes will rise to 43.4%; Capital Gains to 23.8%; Estate Tax to 55% with a mere 1 million dollar extension (death tax). Tax brackets rates will rise between 3 and 5%.
- Congress has also imposed Sequestrian on itself if it fails to cut spending. What that means is that on January 15, 2013 there will be automatic cuts in the amount of 1.3 Trillion with 50% coming from discretionary spending and 50% from defense.
For the most part, we received some very positive support and interest of our issues. I will be following up with each office until I receive a definitive answer on support or opposition on the legislation discussed. As if gridlock isn't bad enough, it's even worse in a presidential election year, but NM's Delegation certainly conveyed concern over the seriousness of our issues and concerns and seemed determined and willing to work hard on solutions. If you have any question, or would like more detailed information on any of the issues, please call me at 505 888 0752.
Jane Jernigan NUCA of NM Executive Director
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Bill Devinney, AON Risk Services
