When the 110th Congress convenes in January, it will look significantly different from the previous Congress. The Democrats will assume control of both the House and the Senate, which means new leaders, new committee chairmen, and many new faces. However, the starkest similarity is the razor-thin margin of control that the majority party has over the minority party in both the House and Senate, meaning that legislators will have to cross party lines - or accomplish nothing.
BOMA Intl.’s “wish list” for 2007 and the 110th Congress remains largely unchanged from 2006. BOMA Intl. will continue to focus significant attention on tax issues, the expiring Terrorism Risk Insurance Extension Act of 2005 (TRIEA), energy issues, and the rewrite of telecommunications laws. BOMA expects to see action on each of these issues over the next 2 years of the session, though the Democrats’ priorities of increasing the minimum wage, immigration reform, lobbying reform, and focusing on the next phase of the Iraq war will undoubtedly capture the attention of Congress for the first half of the year.
But, time is running out on the terrorism risk insurance issue; BOMA Intl. and its partners in the Coalition to Insure Against Terrorism (CIAT) will continue to press Congress for a quick resolution. TRIEA expires on Dec. 31, 2007. Absent TRIEA or a new program to take its place, BOMA fears that building owners and policy- holders will once again find it difficult, if not impossible, to find adequate levels of terrorism insurance at reasonable rates and terms. The new chairman of the House Financial Services Committee, Barney Frank (D-MA), is anticipated to hold hearings early in the year. The Senate Banking Committee will likely follow suit with hearings of its own under the leadership of its new chair Chris Dodd (D-CT).
Another BOMA priority that will likely receive attention in the first half of the next Congress is the tax incentive for energy-efficiency upgrades, which is also set to expire at the end of 2008. This is the federal tax deduction of up to $1.80 per square foot for upgrades that result in performance which exceeds the ASHRAE 90.1-2001 Standard by 50 percent. BOMA would like to see this incentive extended and improved to be of greater benefit to more members. One can expect the possibility of this incentive to be part of a broad Democratic energy bill aimed at furthering energy independence. The legislation would go through the new chairs of the House Energy and Commerce Committee and Senate Energy and Natural Resources Committee, Representative John Dingell (D-MI) and Senator Jeff Bingaman (D-NM), respectively.
In the area of tax policy, the recent shift to a Democratic majority will likely put Charlie Rangel (D-NY) in place as chair of the House Ways and Means Committee and Max Baucus (D-MT) as chair of the Senate Finance Committee. Both legislators were supportive of the “tax extenders” that passed at the end of last Congress, which included leasehold depreciation and brownfields expensing. However, Rangel in particular has publicly opposed further extension of the Bush tax cuts due to expire in 2010 that include the BOMA-supported reduced rate on capital gains and dividends.
Instead, expect the focus to be in middle-class tax relief such as a permanent fix to the alternate minimum tax (AMT).
Even with a majority in Congress, Democrats must take into account the slim margins they hold in both houses and the threat of a veto by the President. With a Republican in the White House and without a veto-proof majority, the Democrats must take Republican positions seriously in its policy development. BOMA Intl. looks forward to the challenge of pursuing its legislative priorities in this new political landscape of a divided federal government.
In the States
As at the federal level, state elections proved to be a win for the Democrats. The six-office gain brings Democrats a majority of the nation’s governorships with 28. In total, Democrats control both houses of the legislature in 23 states, Republicans in 16, and 10 are split (Nebraska’s legislature is nonpartisan).
On Election Day, voters acted on 204 ballot initiatives. Voters in Florida, Georgia, Michigan, Nevada, New Hampshire, North Dakota, Oregon, and South Carolina approved measures to restrict eminent domain for economic development. Broader and more controversial regulatory takings measures passed in Arizona, but failed in California, Idaho, and Washington. In Arizona and Nevada, voters passed measures to prohibit smoking in enclosed public places and places of employment; however, the Nevada measure exempts standalone bars and gaming areas of casinos. Voters in Washington approved a measure that requires investor- and consumer-owned utilities with 25,000 or more customers to meet designated targets for energy conservation and the use of eligible renewable energy resources.
For more information on these and other issues, call BOMA Intl. at (202) 408-2662 or visit (www.boma.org).