This is Eric Wareham, Vice President of Government Affairs for WEDA, and welcome to another edition of Legislative Landscape. In this episode we update you on the demise of Right to Repair legislation, the winding down of state legislative sessions and the push towards a Biden infrastructure and tax plan.
The clock is running out on Right to Repair legislation around the country. After over 40 bills were introduced in 27 states, it looks like we will keep our track record intact of not having a single bill pass a chamber of origin. This was a difficult year to continue that streak given the difficulty of communication with legislators because of covid protocols that ranged from all virtual legislative sessions to legislative sessions broken up by covid outbreaks. Since 2016, we have now defeated well over a hundred individual pieces of Right to Repair legislation.
After this year’s legislative session, its clear that we need to do more to inform legislators and customers about what the industry has done to increase uptime for farmers and ranchers. Claims were made this last session that manuals are not available for farm equipment. An absurd claim for all who know, but many legislators took that information as credible. WEDA and manufacturers are planning a series of dealer demonstrations for stakeholders to show what is available to support customers ability to perform their own repairs. WEDA will also be participating in several legislator conferences to share this information as well. Combined with defeat of legislation several years in a row, the hope is that we can prevent this legislation from ever moving beyond being introduced as a bill.
Moving on to a broader view of legislative sessions as many states have already adjourned or are sprinting to the finish line, its worth taking a look back on what the trends were. At the outset of this year, the consensus was that states would be in a serious bind financially because of the covid crisis and decreasing revenue figures. The opposite has turned out to be true for most states, even before considering federal financial aid. Because of preemptive measures to rein in spending last year in anticipation of a budget crunch, many states actually saw their coffers more than full this year, most notably California has led the way with a staggering $75 billion dollar surplus and is now projecting refund checks to taxpayers. Many states are in good shape as the economic fundamentals remained sound during covid and spending was cut back, which allowed many states to scrap plans for increased state taxes.
The same cannot be said for the federal government, however. After several trillion in deficit spending, the Biden administration is pushing their infrastructure plan that will be required to have a payfor element. Probably more significant than the actual infrastructure spending is the tax plan that accompanies it which portends to drastically change the tax landscape moving forward. There are many elements to the tax plan that will affect high income earners, small business and agriculture, but the details are not completely clear just yet.
The end of this month will provide some much desired detail around Biden’s tax proposal. Sometime at the end of May, Treasury will be releasing their green book detailing how the Biden tax plan will be applied. Around the same time, the White House Office of Management and Budget will be releasing their 2022 full fiscal budget request that will also detail projected revenue and spending increases. These two documents will be the first real look under the hood at how the Biden tax plan will operate. Of course, the Biden plan is just that-a plan- and is subject to change through negotiations with democrats and republicans. However, as with past legislation by crisis, it seems that whatever the ultimate package is, it will take shape swiftly. Speaker Pelosi has already stated that she wants to pass an infrastructure bill before the July 4th recess.
Whatever the changing landscape looks like, you can bet WEDA will be in the middle of it and communicating to dealers what to expect. Look for an upcoming webinar covering the expected changes and certainly one to follow once any legislation is passed. WEDA is also working in the trenches on legislation to ensure that certain elements of the 2017 tax cut and jobs act remain intact, like the floor plan interest amendment.
So even though state legislative session is winding down, we don’t have time to catch a breath as things are heating up at the national level. Be sure to check in with the association about any questions you have as we work on this legislation. Lots of expertise in tax and business planning to help you make decisions as we adapt to a fast changing legislative landscape.
Podcast By Eric Wareham
ERIC WAREHAM is the vice president of government affairs for the Western Equipment Dealers Association. He is a graduate of the Willamette University College of Law and Augusta State University. Eric may be reached by writing to email@example.com.