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Broad Stimulus Package
Will Create New Jobs, |
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Deliver
Needed Help for Families |
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“This is an Investment in
the Future of Nevada and the Nation”
Calling the package an
investment in the future of Nevada and the nation, Congresswoman Shelley Berkley
voted in favor of a broad economic stimulus package. The American Recovery
and Reinvestment Act, which passed on a vote of 244 to 188, will create
millions of new jobs, deliver tax relief to working families and provide funding
to states for healthcare, education, clean energy and new roads and highways.
“Nevada families and
businesses will benefit from the resources included in this broad stimulus
package, which will create millions of new jobs and fund important needs like
education, healthcare and clean energy production. Families will also see a tax
savings of up to $1,000 per year that they can use to help cover expenses from
groceries to gas and rent,” said Berkley, who helped to shape the tax relief
provisions included in the stimulus package through her seat on the House Ways
and Means Committee.
“Our bill has the strong
support of police, teachers, parents, economists, doctors and nurses, mayors,
construction workers, homebuilders and businesses large and small – just to name
a few. At a time when the economic picture remains bleak and families are
struggling to stay afloat, we are truly making an investment in the future of
Nevada and this nation and the time to act is now,” said Berkley.
TAX RELIEF
“The ‘Making Work Pay’ tax
credit will mean more money in the pockets of 950,000 Nevada taxpayers. Under
our plan, 95% of all Americans will see a tax savings, with married couples
eligible for up to $1,000 and individuals eligible as much as $500 in much
needed tax relief,” said Berkley.
NOTE:
The Making Work Pay Tax Credit will cut taxes for more than 95% of
working families. The bill provides a refundable tax credit of up to $500 for
working individuals and $1,000 for working families. Taxpayers can receive this
benefit through a reduction in the amount of income tax that is withheld from
their paychecks, or through claiming the credit on their tax returns.
CLEAN ENERGY & GREEN JOBS
“Southern Nevada’s solar
potential, coupled with our state’s geothermal and wind resources, can make
Nevada a leader in the use and production of clean energy. Our stimulus plan
will create new, green jobs by making critical investments in renewable energy
and energy efficiency,” said Berkley. “The energy provisions in this bill will
give geothermal and other renewable energy projects planned in Nevada the push
they need to get underway. Our package also extends the tax credit for
energy-efficiency improvements to existing homes through 2010. This will create
new employment opportunities while also conserving energy and reducing
greenhouse gas emissions,” said Berkley.
UNEMPLOYMENT ASSISTANCE
“Growing numbers of
Nevadans are relying on unemployment assistance as their only source of income
and these men and women will get extra help under this stimulus plan,” said
Berkley. “Our package provides subsidies to help unemployed families maintain
their healthcare coverage during the economic downturn that has gripped the Las
Vegas Valley. Nevadans who have lost a job should not also have to worry about
losing their insurance coverage and access to critical medical care. That is
why we are extending COBRA benefits to help individuals maintain affordable
coverage, preserving access to care from their regular doctor,” said Berkley.
TRANSPORTATION
“Modernizing and expanding
our network of roads and highways will keep Valley traffic flowing, while
funding for maintenance will increase safety and ensure that bridges and
overpasses pose no danger to drivers or their passengers,” said Berkley. “The
Las Vegas Beltway, I-15 and U.S. 95 are all critical components of the Valley’s
transportation network. Funding from the stimulus package would be made be
available for work on this vital network of freeways that serves not only
residents and businesses, but also millions of visitors to Las Vegas each
year.”
EDUCATION
“Education opens the doors
to a lifetime of opportunity. That is why our package provides substantial help
for states that are faced with slashing education spending from kindergarten all
the way to the university level. Providing Nevada and other states with
additional funding to help meet the educational needs of their students is a
wise investment that will continue to pay enormous dividends for years to come,”
said Berkley.
Nevada Will Benefit Under
Berkley/Dems Ways And Means Package -- Clean Energy Incentives/ Medicaid Help/
First Time Homebuyer Tax Credit Of $7,500/ School Construction Bonds
Ways and
Means Republicans Face Quandary: Follow or Fight Obama?
By
Richard Rubin, CQ Staff
Republicans heading into Thursday’s Ways and Means Committee markup of economic
recovery legislation face a strategic choice.
They
control just 15 of the panel’s 41 seats, making it difficult for them to win
votes on amendments to the $275 billion tax portion (HR 598) of the legislation.
But President Obama also wants his first major legislative accomplishment to be
bipartisan, meaning that even if Republican votes aren’t needed for a committee
majority, they may be politically valuable.
So do
they fight hard against a popular new president, bombarding the majority with
loud criticism? Do they offer carefully crafted amendments, forcing politically
tricky votes for Democrats? Do they search for relatively small changes that
might be find favor, giving the GOP a chance to make a mark on the bill without
altering its structure?
For now,
they seem most likely to mount vigorous opposition to the thrust of the
Democratic proposal, arguing that it would not effectively stimulate the
economy.
“The
money that they’re going to throw out the door, at the end of the day, is not
going to work,” said Ways and Means member Devin Nunes, R-Calif.
Republican leaders said Wednesday that they are developing their own set of
“fast-acting” tax plans they hope to pitch to Obama at a meeting they have
requested. The GOP counterproposals will focus on cuts to capital gains and
dividends taxes, as well as marginal rate cuts, said Charles Boustany Jr., R-La.
The tax
title released late last week already contains several items Republicans like.
A $15
billion provision would allow businesses to use their losses in 2008 and 2009 to
offset profits from five previous years instead of just two. First-time
homebuyers who purchase homes in the first half of 2009 would not have to repay
a $7,500 tax credit, as current law (PL 110-289) requires. And a $5.1 billion
provision would extend, for another year, the bonus depreciation enacted in last
year’s stimulus law (PL 110-185).
But the
tax title also contains provisions bound to irritate Republicans.
It would
require workers on many projects funded by the stimulus package to be paid the
prevailing wage under the Davis-Bacon Act. That move is popular among unions and
Democrats, but Republicans argue it unnecessarily drives up costs.
The bill
also contains a variety of provisions that operate like targeted spending.
The
renewable-energy sector would get a $20 billion boost. The main tax credit for
producing electricity from renewable sources would get a three-year extension,
and corporate research into certain energy and battery technology would get an
additional tax credit.
Homeowners making energy-efficiency improvements to existing homes, now eligible
for a 10 percent tax credit, would see that boosted to 30 percent, with a cap of
$1,500.
The bill
also would direct billions of dollars to education, creating $22 billion in tax
credit bonds for school construction and offering a new $2,500, partially
refundable tax credit for tuition and other expenses.
State
and local governments would also get a range of assistance through the tax code
under the bill.
The
largest, at $18.3 billion, would allow state and local governments to issue tax
credit bonds instead of tax-exempt bonds in 2009 and 2010. Instead of avoiding
tax on their income, bond holders would receive a federal tax credit. That would
help the governments cover the cost of the interest. The provision would also
allow state and local governments to receive direct federal subsidies instead of
tax credits if they choose, in a nod to the difficulties in the bond and
tax-credit markets.
Another
$25 billion in tax credit bonds would go to states and regions based on their
job losses, to be spent in targeted “recovery zones” on infrastructure, job
training and other investments.
Targeted
Personal Cuts
The
individual tax provisions in the bill are targeted toward lower-income people,
as opposed to the broad rate cuts that Republicans generally favor.
The
largest single provision in the package is the $145.3 billion Making Work Pay
tax credit, which would give workers a break on their income taxes, or a rebate
check, to cover their first $500 in payroll taxes, though it would begin to
phase out for individuals making more than $75,000 and couples making more than
$150,000. Workers could change their withholding immediately or receive the
money when they file their tax returns in April 2010.
Under
the bill, the tax credit would last through 2010. That’s also when the 2001 and
2003 tax cuts (PL 107-16, PL 108-27) are set to expire, forcing Congress to make
a wide range of decisions about the tax code.
The bill
also would expand the earned income tax credit for low-income workers by
increasing the size of the credit for families with three or more children and
by raising the threshold at which the credit begins phasing out for married
couples.
The
child credit would grow under the bill. An $18.3 billion provision would make
the child credit completely refundable for 2009 and 2010. The credit is worth 15
percent of income up to a maximum of $1,000 per child. Current law limits the
refundable credit for families making less than $8,500.
These
provisions, particularly the Making Work Pay proposal, seem likely to face
criticism from Republicans. House Republican Whip Eric Cantor, R-Va., called the
payroll tax break a “gimmick” that would undermine the idea that everyone shares
the burden of the Social Security system.
A House
Budget Committee release described such refundable credits and rebates as
“spending that masquerades as tax relief.”
“Is it
fair to give Americans more than they’ve actually paid in taxes?” asked ranking
member Dave Camp, R-Mich.
The
House bill lacks a one-year “patch” to prevent the alternative minimum tax from
growing in 2009 and ensnaring more than 20 million additional taxpayers.
But that
roughly $70 billion idea has support in the Senate, and Ways and Means Chairman
Charles B. Rangel, D-N.Y., said he expects it to get added there on top of the
$275 billion House plan.
Senate
Finance Chairman Max Baucus, D-Mont., who plans to mark up his bill Jan. 27,
said it would be somewhat larger than the House version.
Unemployment Provisions
The Ways
and Means bill also extends an emergency program to put federal funds behind
state-based programs to provide extended unemployment benefits to laid-off
workers. Under the bill, the term of such emergency lending is extended by eight
months, from March 31 to Dec. 31, and the secretary of Labor is given the
authority to receive from the Treasury Department whatever funds are necessary
to keep the program going.
The bill
also gives states an opportunity to slightly increase the size of unemployment
payments, by entering into agreements with the secretary of Labor to increase
the weekly benefits being paid to people in the system and their dependents by
$25 per week.
The
legislation also attempts to make the program more flexible by enabling states
to transfer funds among themselves, in order to catch the body of “displaced”
workers who have moved to seek new jobs.
Drafters
hope the unemployment spending will deliver a relatively powerful, immediate
effect. Unemployment insurance — along with food stamps and tax cuts favoring
the least well-off — is seen as providing extra bang for the stimulus buck, as
economically stressed people are likely to spend whatever marginally increased
cash flow they are given when times are tight.
Rep.
John Linder, R-Ga., said Republicans would offer an amendment to strike from the
Rangel draft the expansion of unemployment insurance and other social spending .
Also
Wednesday, the U.S. Chamber of Commerce stepped up its effort to include a
two-year provision that would reduce tax liability for companies that purchase
their own debt back from financial institutions at a discount.
The
proposal is aimed at encouraging businesses to reduce their debt loads and
helping banks get rid of devalued loans.
Joseph
J. Schatz, Drew Armstrong and Karoun Demirjian contributed to this story
Increased Unemployment Figures Underscore Need
for Broad Democratic Stimulus Package
Congresswoman Shelley Berkley pointed to new unemployment figures for Nevada as
the latest evidence of the need for Congress to quickly pass a broad economic
stimulus package. The results show Nevada’s statewide unemployment rate topping
nine percent for December of last year. As a member of the powerful House Ways
and Means Committee, Berkley helped to craft portions of the stimulus package
that would extend unemployment benefits for job seekers in Las Vegas and across
the nation. H.R. 1, The American Recovery and Reinvestment Act, is scheduled
for consideration by the full House of Representatives this week.
“Growing
numbers of Nevadans are relying on unemployment assistance as their only source
of income and these men and women will get extra help under the Democratic
stimulus plan,” said Berkley. “That is why we need to come together in
Congress, pass this broad package and get it to President Obama for his
signature.”
The Ways
and Means stimulus package passed last week with Berkley’s support would extend
unemployment insurance benefits through the end of 2009 and increase the benefit
by $25 per week. The extension would provide critical assistance to
approximately 3 million people through 2009, while the benefit increase will
help nearly 20 million unemployed workers. Also included is an extension
designed to help families maintain their health coverage even when a job is
lost.
“Our
plan provides subsidies to help unemployed families maintain their healthcare
coverage during the economic downturn that has gripped the Las Vegas Valley.
Nevadans who have a lost a job should not also have to lose their insurance.
That is why we are extending COBRA benefits so that individuals can maintain
affordable coverage and access to their regular doctor.”
The
package assembled by Berkley and her colleagues also provides tax relief to 95%
of Americans through the “Making Work Pay” tax credit.
“Democrats are delivering a tax savings of up to $500 per taxpayer or $1,000 per
married couple under our bill,” said Berkley. “This tax credit will help put
more money in the pockets of nearly 950,000 Nevadans at a time when families are
struggling just to cover the basics like food and rent.”
The
“Making Work Pay” tax credit would cut taxes for more than 95% of working
families in the United States. For 2009 and 2010, the bill would provide a
refundable tax credit of up to $500 for working individuals and $1,000 for
working families.
Summary
of Unemployment Insurance Provisions
1.
Encourage Unemployment Insurance (UI) Modernization
The
proposal, similar to legislation passed by the House in 2007, would provide up
to $7 billion to reward and encourage States enacting specific reforms designed
to increase UI coverage among low-wage, part-time and other jobless workers, as
well as provide an additional $500 million in UI administrative funding.
2.
Continue the Emergency Unemployment Compensation Program
The
current federally-funded extended unemployment benefits program (which provides
up to 33 weeks of extended benefits) is scheduled to begin to phase out at the
end of March 2009. The proposal would use general revenues to extend the program
through December 31, 2009.
3.
Increase UI Checks by $25 a Week for Jobless Workers
The
proposal would provide federal funding to increase both regular and extended
unemployment benefits by $25 a week through calendar year 2009. (The current
average unemployment benefit is roughly $300 a week.)
4.
Short-Term COBRA Subsidy for Involuntarily Terminated Workers
The
proposal would provide a 65 percent subsidy for COBRA continuation premiums for
up to 12 months for workers who have been involuntarily terminated (and their
families). This subsidy also applies to health care continuation coverage if
required by states for small employers. To qualify for premium assistance, a
worker must be involuntarily terminated between September 1, 2008 and December
31, 2009. The subsidy would terminate upon offer of any new employer-sponsored
health care coverage. Workers who were involuntarily terminated between
September 1, 2008 and enactment, but failed to initially elect COBRA within 60
days as required by law, would be given an additional 60 days to elect COBRA and
receive the subsidy. In these instances, benefits would be prospective only.
5.
Access to Medicaid for Unemployed Workers
The
proposal would provide states the option of offering coverage to unemployed
workers through their Medicaid programs, with the federal government matching
100
percent of the costs of benefits and administration. States could offer coverage
to individuals who are unemployed and uninsured and fall into one or more of the
following three categories:
(1)
individuals (and their dependents) who receive unemployment insurance benefits
or who have exhausted unemployment insurance benefits;
(2)
individuals (and their dependents) who have income below 200 percent FPL
($42,400 for a family of 4) and are not otherwise eligible for Medicaid or CHIP;
(3)
individuals (and their dependents) receiving food stamps who are not otherwise
eligible for Medicaid or CHIP.
In all
cases, the individual must be involuntarily separated from employment between
September 1, 2008 and December 31, 2010 and remain unemployed.
6.
Extension of COBRA for Older and Tenured Workers
The
proposal would provide COBRA-eligible workers who are 55 and older, or have
worked for an employer for 10 or more years, the ability to retain COBRA
coverage, at their own expense, until they become Medicare eligible at age 65 or
secure coverage through a subsequent employer.
