The Ferguson Group Blog

Wednesday News Roundup

Every Wednesday, The Ferguson Group blog will be posting a series of articles published over the previous week that discuss topics of interest to local governments. Learn about emerging trends and keep up on key policy issues by browsing the TFG Wednesday News Roundup!

Sales Tax Fairness

In recent Senate votes, there is strong bipartisan majority who support changes to existing law that require online retailers to collect sales tax only if they have a physical presence in the customer’s state, whereas physical establishments must pay.  This “unfair advantage” deprives states of an estimated $11 billion in annual sales-tax revenue.  Read More…

Energy Revenue For Infrastructure:  A ‘natural link’

As Congress looks to energy revenues to fund the rebuilding of America’s infrastructure, Speaker John Boehner suggests that revenues from oil and gas drilling should be included.  With the 2014 transportation bill deadline looming, the avenues for stabilizing the Highway Trust Fund will be central to the energy revenue debate.  Read More…

Record Build America Bonds Rally Defies Subsidy Cut: Muni Credit

Even with significant cuts due to sequestration, the Build America Bond market is rallying.  Investors believe municipalities can withstand the reduced subsidies because of improving revenue and the current housing rebound.   Read More…

EPA Warns of Poor US Water Quality

According to a comprehensive examination of water quality by the U.S. Environmental Protection Agency (EPA), they determine that 55% of U.S. rivers and streams are in poor condition for aquatic life, noting that only 21% of waters were in “good” condition.  Read More…

Department of Energy Launches New Clean Energy Manufacturing Initiative

The new Clean Energy Manufacturing Initiative created by the Department of Energy (DOE) aims to strengthen American competitiveness in clean energy manufacturing.  The Department aims to support innovations that will lead clean energy technologies towards subsidy independence.  Read More…

Industry Perspective:  7 Steps for Staying Safe in the Super-storm Era

Mass communication tools have proven to be effective in the event of severe weather and other safety and security scenarios.  These tips can help ensure the effectiveness of current emergency notification systems to keep your communities safe.  Read More… 

Wednesday News Roundup

Every Wednesday, The Ferguson Group blog will be posting a series of articles published over the previous week that discuss topics of interest to local governments. Learn about emerging trends and keep up on key policy issues by browsing the TFG Wednesday News Roundup!

Gallup: State, Local Governments Hiring Most Since Economic Collapse

A new Gallup poll indicates that the state and local government employment sector has started to rebound for the first time since the start of the recession.

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Bond Sellers Fret Over Romney Tax Plans

Comments from the Romney campaign that the candidate’s tax reform plan could aim to raise revenue by targeting tax-exempt municipal bonds have restarted a debate over the future of this tax incentive.

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American Society of Civil Engineers Releases New ‘Failure to Act’ Study Focusing on Ports

A new ASCE report indicates that new investments in ports, inland waterways, and airports are necessary in order to ensure that American exports remain competitive.

Read More…

Being Neighbor.ly in Kansas City: Kickstarter for Local Government?

Kansas City is looking to duplicate the success of crowdfunding websites like Kickstarter to raise funding for local projects.

Read More…

N.J. Pilot Program IDs Hazards in Abandoned Buildings

Camden is the site of a new pilot program established by the New Jersey Department of Environmental Protection, which aims to help first responders identify buildings that contain hazardous materials as they are responding to incidents at these sites.

Read More…

House Passes Payroll Tax Extension

The House of Representatives passed legislation tonight that would extend for one year the employee payroll tax rate of 4.2%, extend unemployment insurance, and renew the "doc fix" that prevents cuts in reimbursements to doctors who see Medicare patients. However, the bill has little chance of being enacted because it also includes several provisions that Democrats have publicly opposed, including language that would speed up approval of the Keystone XL oil pipeline, authorize the Federal Communications Commission to auction new sections of the electromagnetic spectrum, and delay new EPA regulations for industrial boilers. The bill was passed on a largely partisan basis in the House, with 10 Democrats supporting the measure while 14 Republicans rejected it.

Senate Majority Leader Harry Reid (D-NV) has vowed that the legislation will not pass his chamber, and President Obama has threatened to veto the bill if it does. Both President Obama and Majority Leader Reid have strongly supported an extension of the payroll tax but are opposed to attaching other controversial provisions to the extension. Lawmakers from both parties are expected to work on a compromise that would extend the payroll tax for 2012 before leaving Washington for the holidays.

Bipartisan Proposal to Add Infrastructure Funding to Payroll Tax Cut

Washington has been consumed during the past week by debates over the fate of a payroll tax cut first created in 2010 as part of the compromise to extend the Bush tax cuts and currently set to expire at the end of 2011. The 2010 compromise reduced the Social Security tax paid by employees from 6.2% to 4.2% and President Obama has strongly supported extending and expanding this cut in 2012, along with a similar tax cut for employers. Although there is strong support in both the Senate and the House for some form of extension, if not an expansion of the tax cut, Republicans and Democrats have clashed on how to offset the loss in Social Security trust fund revenue that this measure will necessitate. Democrats have proposed replacing payroll tax revenue with a surcharge on income tax over $1 million, while Republicans have countered with a proposal to replace the revenue through cost saving measures, including a pay freeze for federal employees and the elimination of federal jobs.

As leadership in the Senate and House look for a way to bridge the gap between offset proposals, Senators Claire McCaskill (D-MO) and Susan Collins (R-ME) have introduced a bipartisan proposal that would not only expand the payroll tax cut to apply to both employees and employers in 2012, but would also include $35.8 billion in new spending for road and water infrastructure projects. This legislation would provide $10 billion for states to increase capitalization of state infrastructure banks, which leverage private funding to finance large infrastructure projects. It would also include $25 billion in new bridge and highway funding authority, which would be distributed through FHWA formula programs, as well as $800 million in new funding for the Clean and Drinking Water State Revolving Loan Funds. The payroll tax cut and new spending would be paid for by a combination of an interest tax surcharge on millionaires and the elimination of tax breaks for large oil companies.

Democrat and Republican leaders continue to debate the payroll tax extension, and no proposal has yet obtained the support of both parties. Senate Minority Leader Mitch McConnell has expressed his opposition to paying for the payroll tax cut by raising taxes on the wealthy, leaving the fate of the McCaskill-Collins proposal in doubt. However, Congress must act on some form of payroll tax extension by the end of the year or face a tax increase for all American workers.

President Obama Outlines “American Jobs Act”

Tonight, in an address to a joint session of Congress, President Obama asked Congress to work quickly to pass the American Jobs Act, his new legislative proposal to stimulate the economy. Although some details of the proposal are still forthcoming, initial reports indicate that this legislation will include approximately $447 billion worth of new tax cuts and spending increases. The President tasked the Joint Deficit Reduction Committee, charged by the debt ceiling deal to come up with at least $1.2 trillion in savings over the next 10 years, with finding additional savings to offset the cost of this proposal and promised to release a long-term deficit reduction plan on September 19^th. Preliminary outlines of the President’s proposal indicate that it will call for approximately $30 billion to state and local governments to rehire teachers, $5 billion to hire emergency first responders, $25 billion of investment in public school infrastructure, $5 billion to modernize community colleges, $15 billion to rehabilitate vacant homes, and $50 billion for transportation infrastructure projects, including $10 billion to capitalize an infrastructure bank modeled after a proposal by Sen. Kay Bailey Hutchinson (R-TX) and Sen. John Kerry (D-MA).

 

Further details of this proposal will be emerging over the next few days, as the White House holds a series of conference calls on the American Jobs Act and releases the bill text. The Ferguson Group will be monitoring these developments and you can visit this blog over the coming week to receive periodic updates on the President's jobs plan.

Senate Job Creation Bill Expected This Summer

In an effort to jumpstart the economy, the Senate is expected to take up new job creation legislation sometime this summer. While some in Congress have indicated their support for an infrastructure spending package, it appears more likely that the Senate bill will focus on extension of payroll tax breaks and other similar efforts. The Obama Administration has indicated support for extending payroll tax deductions, which are set to expire in December, and also support for a payroll-tax reduction for employers.