BOMA ADVOCACY UPDATE September 2019 Emily Naden, Director of Federal Affairs
Who We Are • 5 Fabulous government affairs staff based in DC • 2 federal lobbyists covering Capitol Hill and the federal agencies • 2 great state and local affairs staff • 1 political fundraiser • The most comprehensive codes team in all of real estate
ADVOCACY IN YOUR INBOX
A Divided Capitol
2019 Priority Issues Update • 179D-Energy Efficient Tax Deduction • Fixing Qualified Improvement Property • Terrorism Risk Insurance (TRIA)
179D : Energy Efficient Commercial Buildings • First enacted in 2006 • Remains the only federal incentive for EE improvements • Expired at the end of 2017 • BOMA testified before Congress in March of 2018 President Henry Chamberlain Testifies
179D: Commercial Buildings Energy Efficient • House: “Tax Extenders” legislation including 179D was passed out of committee in the House in late June. It would reinstate and extend the deduction through 2020. • We are working closely with Rep. Blumenauer (D-OR) and Tom Rice (R-SC) on a bill that would make 179D permanent • Senate: Senate Finance convened task forces to examine each unresolved tax provision- BOMA has presented the case for 179D • The bi-partisan report recommended 179D be made permanent
Qualified Improvement Property (QIP) • A drafting error in the Tax Cuts and Jobs Act (TCJA) of 2017 combined 4 property types, including leasehold, into one category (Qualified Improvement Property) and neglected to specify a depreciation period • Meant to provide immediate expensing through 2022 and then revert to 15 year depreciation. • Under present law, leasehold improvements depreciate at 39 years • Treasury was a potential path for fix, but not going to happen
Qualified Improvement Property (QIP) • The Restoring Investment in Improvements Act was introduced in both the House & Senate • Senate: (S.803) sponsored by Sens. Jones, Toomey, King, Manchin & Shaheen • Currently has 44 co-sponsors • House: (H.R. 1869) sponsored by Reps. Panetta & Walorski • Currently has 193 co-sponsors • Lots of Co-sponsors means lots of momentum, but the bill will not move on its own
TRIA Reauthorization • First enacted in 2002 TRIA has been reauthorized 3 times • Federal backstop for insurers and reinsurers • BOMA cares because TRIA coverage is required for our transactions • Set to expire at the end of 2020 • So we’ve got a ton of time right??
Opportunity Zones Deadline to buy-in to get full benefit end of this calendar year Potential Pitfalls Potential Benefits Doubling the basis is hard and harder the Defer capital gains and avoid other larger the business capital gains Bad press: Zones are not equal, some of the most poor census tracts were not Rejuvenate a blighted, populated area selected, some that were are 3X poverty rate Bring jobs, commerce, money flows = Does nothing for a business already in the people are happy Ozone Donut holes where there is no census tract Who will this really benefit?
Timeline for Using Opportunity Zones
Lands of OZ in PAC NW
Parking Taxation At first this was merely a tenant issue…then the IRS issues guidance. Any tenants who use parking on your lots or structures may be subject to pay taxes on the value of that parking…even if you don’t charge And who do they think is going to calculate this imputed value? And does their calculation make any sense?
Wyden’s Capital Gains Plan • Gains taxed at ordinary income levels instead of 20/15/0 current preference levels • Pay taxes on annual gains, not just at realization event and take deduction for losses • Applies to taxpayers $1million in income or $10 million in assets for 3 consecutive yrs • $1.5-$2 TRILLION in revenue would shore up Social Security Trust Fund
State and Local Resources
State and Local Resources New Tools State Legislative Tracking - Local associations can opt to receive regular reports on relevant legislation and/or email alerts on specific bills as actions take place Issue Maps - Information on state and local priorities will be displayed on the BOMA website, where you can easily see what’s going on across the country State & Local Community - This tool is being launched as an important vehicle for asking questions and sharing information among colleagues on policy and legislation
The Industry Defense Fund Works for You
BOMA W 2 Challenge 412 400M + 2,000 + 2,000 + Cities Buildings Buildings Square Feet Represented Signed Up Signed Up Shared 493 M+ 27 Square Feet Cities Shared Represented
BOMA CODES PROGRAM
BOMAPAC is Growing
$1,000 BOMAPAC Challenge • Our goal for this year is $90,000 • If all local associations commit to raising at least $1,000 for the PAC in 2019 we can surpass this goal • Each BAE who raises $1,000 for PAC from his/her local association will be entered to win a $500 VISA gift card
February 3, 2020 Washington, DC National Issues Conference
BOMA International Advocacy Staff Advocacy & Building Codes Contacts Emily Naden John Bryant Ken Rosenfeld Meg Novak Maria Balzer-Pisciotta Director of Federal Affairs VP, Advocacy & Building Codes Director of State & Local Affairs GA and PAC Manager Manager of State & Local Affairs Advocacy, Codes and Standards John Catlett Andrew Klein Senior Codes Consultant Energy Codes Consultant
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