House Passes Stimulus Bill with Key Provisions of AIA’s Rebuild and Renew Plan

by Andrew Goldberg, Assoc. AIA
Senior Director, Federal Relations

Summary: On January 28, the U.S. House of Representatives passed an $816 billion economic stimulus bill that includes several provisions from the AIA’s Rebuild and Renew campaign. “The inclusion of many of the AIA’s priorities into the bill is the direct result of sustained advocacy by the AIA and its members who have sent thousands of messages to their House representatives in support of the plan,” says AIA Executive Vice President/CEO Christine McEntee.

The bill now goes to the Senate, which will debate a slightly different version next week in advance of President Obama’s desire to sign it into law by February 13.

1. Investing in long-term projects
Rebuild and Renew called on Congress to split money between “shovel-ready” projects and those still in the planning and design phases.
The House bill allows up to 50 percent of funding to be used on projects where construction can commence within the next 18 months, allowing for longer-term investments than just “shovel-ready.”

2. 21st century schools
Rebuild and Renew called for a major federal investment in modernizing and greening America’s schools.
The House bill provides $20 billion for school modernization, including $14 billion for K-12 schools and $6 billion for higher education institutions. It creates new modernization, renovation, and repair programs for schools and colleges, with a minimum of 25 percent of the funds focused on green building projects. It also creates a new bond-financing program for school construction, rehabilitation, or repair.

3. Green buildings
Rebuild and Renew called for funds for greening federal buildings, affordable housing, and commercial and institutional buildings, including health-care facilities.
The House bill provides $7 billion for upgrading federal buildings and making them energy efficient. It provides energy sustainability and efficiency grants and loans to help school districts, colleges, local governments, and some hospitals become more energy efficient. It promotes energy-efficient investments in homes by extending and expanding tax credits through 2010 for purchases such as new furnaces, energy-efficient windows and doors, or insulation; establishes a new program to upgrade HUD sponsored low-income housing to increase energy efficiency; and invests in energy efficiency upgrades in public housing to improve living conditions for residents and lower the cost of operating these facilities.

The bill also increases support for several critical housing programs, including providing $4.2 billion for the Neighborhood Stabilization Program to help communities purchase and rehabilitate foreclosed, vacant properties to create more affordable housing and reduce neighborhood blight; $1.5 billion for the Emergency Shelter Grant program to provide short-term rental assistance, housing relocation, and stabilization services for families during the economic crisis; and $500 million to support the Rural Housing Insurance Fund.

4. Transit and livable communities
Rebuild and Renew called for funding for transit projects and community development through Smart Growth and planning.
The House bill invests $10 billion in transit and rail, including new construction of commuter and light rail and improvements to intermodal and transit facilities. It helps state and local governments make investments for innovative best practices to achieve greater energy efficiency and reduce energy use, including building- and home-energy conservation programs, energy audits, fuel conservation programs, building retrofits, and Smart Growth planning and zoning. It also encourages states to adopt updated energy-efficient building codes and regulatory policies to encourage utility-sponsored gains in energy efficiency.

5. Tax relief
Rebuild and Renew called for tax relief for businesses, especially small architecture companies badly hurt by the recession, including a repeal of an onerous tax withholding requirement and accelerated depreciation for new equipment.
The House bill repeals the withholding tax on payments to government contractors. And it helps businesses quickly recover costs of new capital investments by extending the increased bonus depreciation for businesses making investments in new plants and equipment in 2009.

Also of interest
In addition, the bill:

• Provides a 65 percent subsidy for COBRA premiums for up to 12 months for people who were involuntarily separated from their jobs between September 1, 2008, and December 31, 2009
• Provides immediate and sustained tax relief to 95 percent of American workers through a refundable tax credit of up to $500 per worker ($1,000 per couple filing jointly), phasing out at $200,000 for couples filing jointly and $100,000 for single filers. These tax cuts would be distributed to millions of families by reducing tax withholding from workers’ paychecks.
• Cuts taxes for the families of more than 16 million children through an expansion of the child tax credit. By expanding the child tax credit, the plan would provide a new tax cut for more than 6 million children and increase the existing credit for more than 10 million children.
• Allows businesses to improve cash flow by providing a five-year carryback of net operating losses (NOLs). This would allow businesses to write off 90 percent of losses incurred in 2008 and 2009 against taxes assessed over the previous five years. (Current law limits NOL carryback to the previous two years.) This would not be available to companies that have benefited under the Troubled Assets Relief Program (TARP).
• The bill continues through December 2009 the extended unemployment benefits program, which provides up to 33 weeks of extended benefits and is otherwise scheduled to begin to phase out at the end of March 2009. This will help an additional 3.5 million jobless workers.

In the coming days, the AIA Federal Relations team will perform a more detailed analysis of the bill to assess the impact on jobs creation and retention for architects.