Error in tax-cut bill could harm HFA members

Sen. Doug Jones

Sen. Doug Jones (above), the Democrat who upset Republican Roy Moore in Alabama’s 2017 special election, didn’t take his seat in time to vote for or against the Tax Cuts and Jobs Act. But he does want to fix it.

There have been plenty of political arguments about the effect of the tax cuts, Republicans’ signature legislative accomplishment during the Trump administration. But there’s no dispute about a provision that all but wiped out a tax break for businesses like furniture retailers that expand or renovate their property:

It was a screw-up.

The bill writers meant to create a better depreciation allowance. Instead, a drafting error changed the language to make it worse. As a result, the recovery period for a normal business expense was extended from 15 years to 39 years, far beyond the reasonable life of any business improvement.

The inadvertent change makes it much less feasible for a furniture retailer to renovate his or her showroom, warehouse or distribution center, which discourages growth, employment and other economic benefits – just the opposite of what was intended.

You can read a good overview on this snafu here.

So, a “technical correction” bill was written last year to fix this and other flaws in the Tax Cuts and Jobs Act. In all the end-of-year chaos of the government shutdown, however, the corrections didn’t pass.

Well, it should be easy to try again this year, right?

“Should be,” maybe. But we’re talking about Washington, D.C., with more than the usual level of dysfunction and partisan warfare.

Democrats now control one-half of Capitol Hill, the House of Representatives. They opposed the tax cuts bill in the first place, and some of them look at this problem as one that’s owned by the Republicans. They have little interest in helping the Republicans fix it.

Petty? You bet. The Democrats should be ashamed. For the sake of partisan advantage, they may not address an issue that could mean a lot to small businesses in the districts they represent.

On the other hand, there’s no arguing the fact that the Republicans had an entire year to deal with this error and didn’t. Why not? Some observers say they didn’t want to acknowledge such a stupid blunder, let alone make it right.

Well, whatever the explanation, the problem remains. The question is whether anyone can rise above partisan politics and do something about it.

Which brings me back to Jones, a Democrat who represents a very conservative, and normally Republican, state. He aims to introduce a bill in the Senate to correct the error and is trying to enlist a few fellow Democrats to sign on. Several are needed, because a Senate bill must get 60 votes to clear a preliminary hurdle and earn a final vote on the floor.

This is a matter of real importance for Home Furnishings Association members, so the HFA has joined a coalition of business groups pressing for a correction. The coalition has targeted several moderate Democratic senators and is organizing lobbying efforts to urge them to support Jones’ bill when it emerges. They include Sherrod Brown of Ohio, Maggie Hassan and Jeanne Shaheen of New Hampshire, Joe Manchin of West Virginia, Tim Kaine of Virginia, Gary Peters of Michigan, Tammy Duckworth of Illinois, Catherine Cortez Masto of Nevada, Tina Smith and Amy Klobuchar of Minnesota, Robert Menendez of New Jersey and Angus King of Maine (who’s technically an independent).

So far, word within the coalition is that Manchin and King will support Jones’ bill. Others may be favorably inclined as well.

It’s pretty much assumed that all GOP senators would favor the bill, which Republican Sen. Pat Toomey of Pennsylvania likely will co-sponsor with Jones.

The HFA’s Government Relations Action Team will ask HFA members in key states to call on their senators and urge their support. If a bill can pass the Senate, maybe it will have a chance to advance in the House – although some Democrats there indicate they likely would attach it to something that would be unpopular among Republicans. Darn politics!

This is the sort of government-relations work the HFA does on behalf of members. I am privileged to serve as the staff liaison for the GRAT, working with our Washington lobbyists at Dutko GR.

We are planning our annual Washington Fly-in, which will be May 13-15, and we hope to see some of the important players on this issue while we’re there. If you’d like to go, please give me a call or shoot me an email.

It’s a shame that it’s become so difficult to get even simple, beneficial things done in Washington, but we can’t accomplish anything if we don’t try. Your participation, and your voice, can only make us stronger and more effective.

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