Maneuvering on breaks resurfaces ahead of key deadline

Source: Geof Koss, E&E reporter • Posted: Friday, June 10, 2016

The looming expiration of the Federal Aviation Administration’s authority is reviving hopes on Capitol Hill that a host of tax breaks, including for renewable energy, could hitch a ride on an expected extension in the coming weeks.

“There’s going to be a push for them,” Senate Finance Chairman Orrin Hatch (R-Utah) toldĀ E&E Daily. “I don’t know what’s going to happen because we’ve tried to end the constant rush to have these programs at the end of the year. And we’ve tried to make as many of them as permanent as we can. But you know it all depends on what people want around here.”

The Senate came close to a deal in April to include a variety of tax allowances — including an extension of the investment credit for geothermal, fuel cells, combined heat and power, and other energy sources — to the FAA measure.

Lawmakers late last year extended the credit for solar for five years, but they left out other energy sources. Advocates have been trying to address the situation ever since (E&ENews PM, April 12).

In the Senate, members of both parties acknowledge the omission was an oversight that occurred in the end-of-the-year legislative crush.

However, House Ways and Means Chairman Kevin Brady (R-Texas) has disputed the notion that it was a mistake but said in December he would revisit the issue this year (E&E Daily, Dec. 18, 2015).

Senate Minority Leader Harry Reid (D-Nev.) has said that Majority Leader Mitch McConnell (R-Ky.) has promised to work to extend breaks for the other energy sources (Greenwire, Dec. 22, 2015).

But efforts to do so during April’s FAA reauthorization debate collapsed amid tussling over the size of the tax package, and both chambers ultimately passed a short-term FAA extension that expires July 15.

Should another short-term extension originate in the House, that would theoretically make it a vehicle for a tax title without running afoul of the Constitution’s requirement that revenue measures start in the lower chamber.

Hatch said, “I’m open to always try to accommodate, but I’d like to get away from this end-of-the-year big push to get everybody’s select programs.”

Whether the upcoming push will focus on the investment tax credit fix Reid has sought or be broader in scope as Finance Committee ranking member Ron Wyden (D-Ore.) has requested remains uncertain.

Wyden this week told reporters the FAA bill could be one option for tackling some unfinished tax business but was noncommittal on the prospects.

The issue is likely to surface Tuesday when the Finance Committee holds a hearing on energy tax policy in 2016 and beyond.