Grassley wants quick action on expired energy credits

Source: Geof Koss, E&E News reporter • Posted: Friday, January 11, 2019

The new chairman of the Senate Finance Committee said this week that he’s hoping to quickly revive an assortment of expired energy tax incentives that got waylaid in the closing days of the previous Congress, but Democrats say the push is likely to be slowed by lingering discontent over the GOP’s tax overhaul and a host of other pending tax matters.

Sen. Chuck Grassley (R-Iowa) told E&E News he “definitely” wants to move on extenders as quickly as possible, noting he has already spoken with Finance Committee ranking member Ron Wyden (D-Ore.) about a strategy.

“I don’t want to say any more, but if we’re going to move it, it’s got to move in a bipartisan way,” he said Tuesday.

Although there was bipartisan appetite for tackling the expired incentives at the end of last year, the House ultimately dropped extensions for the energy breaks from a year-end tax push, opting instead to pursue a separate track in talks with the Senate that never materialized (E&E Daily, Dec. 11, 2018).

Frustration has long run high on the breaks, which were extended last year in the spring but only for 2017, so they expired again after President Trump signed the law. Finance members from both parties had favored longer extensions but were derailed by House Republicans, who largely opposed the incentives.

Interest groups have also pressed a number of changes to existing breaks as well, including a phaseout of a key biodiesel blenders credit that Grassley has supported, the expansion of the investment tax credit for renewables to energy storage technologies and modifications to the 200,000-vehicle cap on the electric vehicle credit that some manufacturers have already hit.

Wyden struck an optimistic tone this week on quick action on extenders, which he said would likely be bundled with bipartisan provisions affecting retirement savings and administration of the IRS.

“A lot of opportunities to find common ground,” he told E&E News.

But Finance Committee member Ben Cardin (D-Md.) said he feared that trying to simply move an extenders package would get bogged down by lingering frustration on other tax matters.

“It doesn’t lend itself easily to one bucket of issues, but I do think we can do extenders,” Cardin said in an interview. “If we can separate it and do it early, I’d be supportive of that provided it’s truly bipartisan.”

In the last Congress, Democrats on both sides of the Capitol complained about being shut out of talks by former House Ways and Means Chairman Kevin Brady (R-Texas). The ascension of Rep. Richard Neal (D-Mass.) to the chairman’s seat is seen as a positive sign, as is the assumption of the Finance gavel by Grassley — a longtime advocate of tax breaks for biofuels and wind energy, Cardin said.

“On the Senate side I’m confident we could put together a package — I think Chairman Grassley is very amenable to this, I know Ron Wyden is, so I think it’s possible,” he said. “It could be a broader package, it could be quicker, but understand there’s a lot of pent-up desires in the tax code so it’s not easy to get cooperation to move a tax package.”

Neal told E&E News last week that committee staff has been “sorting all that stuff right now … and now I think we’re going to try to refine some of that thinking.”

He was noncommittal about whether extenders would move as a stand-alone bill or as part of a bigger package, but he noted an early priority is holding hearings on the 2017 tax overhaul that was enacted solely with Republican support.

Neal said he’d like to start those hearings by the end of January.

Rep. Earl Blumenauer (D-Ore.), who has long advocated for clean energy breaks from his Ways and Means Committee seat, said last week those hearings will be a “reality check” on the 2017 tax bill that will set the tone for legislating on taxes in the 116th Congress.

“Nobody really knows what’s in the bill that the Republicans passed,” Blumenauer said, echoing long-standing Democratic complaints that the GOP tax rewrite was not properly vetted by the panel. “I don’t want to rush into any of these things until we have the chance to look at the big picture and be able to do it right.”

While Ways and Means did have at least one hearing on extenders after the tax overhaul was enacted, Blumenauer said it was “only skin-deep.”

But when asked about Neal’s plans for hearings on the GOP tax overhaul, Grassley yesterday reiterated his opposition to making any changes beyond technical corrections.

“If he’s talking about making changes like raising tax rates, absolutely no!” he said, raising his voice during a meeting with reporters about the Finance panel’s agenda.