Democrats Hit Speedbumps on Reconciliation and Minimum Wage:
Tonight, the House is set to pass a $1.9 trillion reconciliation package to provide funding to state and local governments, direct payments to individuals, and funding to address the ongoing COVID-19 pandemic. Republicans have criticized the legislation for not focusing on COVID relief, instead including hundreds of billions of dollars to bailout pension funds and state and local governments.
Democrats have also hit some speedbumps on the package after the Senate Parliamentarian ruled that the $15 minimum wage hike would fall in violation of the Senate’s Byrd Rule for reconciliation. Though the House still plans to pass the package with the $15 minimum wage included, Democrats are scrambling to include alternative language that could pass Byrd Rule requirements for reconciliation.
Senate Majority Leader Chuck Schumer is considering whether to add a provision that would penalize large corporations that don’t pay workers at least a $15 hourly wage, and Senate Finance Chairman Ron Wyden outlined the idea of a penalty tax earlier today. If framed as a penalty, however, the tax might not necessarily qualify under reconciliation rules, congressional experts said. Wyden’s proposal would impose a tax on larger U.S. companies on their total payroll that would start at 5% and increase over time if any workers earn less than a certain amount, though Wyden didn’t specify the amount or the size of companies affected. He said he would provide a benefit to “the smallest of small businesses,” with an income-tax credit equal to 25% of wages, up to $10,000 a year per employer, to those that pay their workers higher wages.
Senate Budget Committee Chairman Bernie Sanders on Thursday night also proposed a plan, stating large corporations should lose their tax breaks if they don’t pay a $15 an hour wage, and smaller companies should get incentives to pay higher wages.
ABC Supports Tax Permanence for Small Business:
ABC joined a coalition of small business organization in a support letter for H.R. 1381 and S. 480, the Main Street Tax Certainty Act of 2021, to make permanent the 20-percent deduction for qualified business income included in Section 199A of the Tax Cuts and Job Act, signed into law in 2017. Section 199A is scheduled to sunset at the end of 2025.
Led by Representatives Jason Smith (MO) and Henry Cuellar (TX) in the House, and Senators Steve Daines (MT), Bill Cassidy (LA), Tim Scott (SC), and Rob Portman (OH) in the Senate, this bipartisan legislation will help ensure permanent tax parity for the millions of employers organized as S corporations, partnerships and sole proprietorships.
House Set to Vote on PRO Act in March—ACTION NEEDED:
With the PRO Act (H.R. 842) at 209 cosponsors, House Majority Leader Steny Hoyer announced on Twitter that the House will be considering the PRO Act the week of March 8. You can view a list of current cosponsors here and a view of last year’s recorded vote here.
Additionally, the Senate bill (S.420) has been officially reintroduced with 44 original Democratic co-sponsors, including several Senate Democratic freshmen: Ossoff (Ga.), Warnock (Ga.), Hickenlooper (Colo.), Lujan (N.M.), and Padilla (Calif.). Only five moderate Democrats in the Senate are not yet signed on to support the PRO Act: Kelly (Ariz.), King (Maine), Manchin (W.Va.), Sinema (Ariz.), and Warner (Va.), and it is critical that members continue to contact these offices to urge their opposition to the bill.
ABC is leading the Coalition for a Democratic Workplace (CDW) in launching a full campaign to educate lawmakers and the public about the devastating consequences of this bill and its dozens of radical policy provisions. This includes the sign-on letter discussed below. If the bill passes the House, CDW will hold House members who voted in favor of the bill accountable for their votes and target Senators who may be on the fence.
ABC also encourages chapters and members to sign-on to this letter opposing the PRO Act. This coalition sign-on letter to the House and Senate in opposition of the PRO Act needs as many organizations on this letter as possible, so please email firstname.lastname@example.org by Monday, March 1, if your organization would like to join the letter.
It is also critical that members reach out to their members of Congress to oppose this legislation and online resources, including the PRO Act petition, are available below:
PRO Act Website – with fact sheets, op-eds, and coalition activity against the PRO Act
PRO Act Petition
PRO Act Score Card
ABC Action App Information (PRO Act petition, site, and voting record on app)
Chapter Specific Resources: PRO ACT RESOURCES & MATERIALS
REMINDER—ACTION NEEDED—The Fair and Open Competition Act Introduced in Congress:
FOCA has been reintroduced in the 117th congress by Sen. Todd Young (R-Ind.) (Sen. Young press release) and Rep. Ted Budd (R-N.C.) (Rep. Budd press release): H.R. 1284 in the House, and S. 403 in the Senate. This ABC-supported priority legislation was introduced in the Senate this week along with Sen. Tim Scott (R-S.C.) and with the support of 37 original cosponsors in the U.S. House of Representatives. Please see the bill link above for list of cosponsors.
After the bill was introduced, an ABC-led coalition of 17 construction industry and business associations sent a letter to congress in support of the bill, urging them to immediately pass this common-sense legislation.
ABC Chapters and Members can take action to urge their representatives to sign on as a cosponsor in the 117th Congress here.
In an ABC press release sent Wednesday, ABC applauded the introduction of the bill that would encourage more qualified construction companies to compete for federal and federally funded construction projects, providing value for hardworking taxpayers while benefiting the construction industry. ABC also encourages members to share posts on social media with the press release and retweet ABC Gov Affairs post here.
A National Taxpayers Union-led coalition of a dozen taxpayer, free market, and consumer advocate groups also sent Congress a letter of support for FOCA:
FOCA was introduced as the Biden administration is signaling its support for more government-mandated project labor agreements on our nation’s construction projects. FOCA would prevent federal agencies and recipients of federal funding from requiring contractors to sign controversial PLAs as a condition of winning federal or federally assisted construction contracts.
ABC also sent a Feb. 4 letter to President Biden expressing concerns about government-mandated PLAs and the “expansion of existing policies that needlessly limit competition and increase costs on taxpayer-funded federal and federally assisted construction projects.”