Ways and Means Committee Democrats today introduced two pieces of legislation to provide tax credits for advanced energy manufacturing and renew the Build America Bond program. H.R. 6182: The American Advanced Energy Manufacturing Jobs Act of 2012, introduced by Rep. Mike Thompson (D-CA), extends and expands the 48C Advanced Energy Manufacturing Tax Credit. It will uncap the credit for certain advanced manufacturing -- solar, fuel cell, battery -- and provide a $3 billion capped credit for other manufacturing. H.R. 6206: The Build America Bonds Act, introduced by Rep. Richard Neal (D-MA) would help finance needed state and local capital projects including schools, transportation infrastructure, and public safety facilities and equipment, which build infrastructure and create jobs. (Summaries below)
The American Advanced Energy Manufacturing Jobs Act of 2012 and The Build America Bonds Act of 2012 are the sixth and seventh measures introduced in recent weeks as part of the No Excuses agenda as Democrats seek to encourage Republicans to finally act on measures to spur job growth. Other bills in the package include the Wind Powering American Jobs Act, the Hire Now Act, Invest in America Now Act, Investing in American Innovation Act of 2012, and The Bring Jobs Home Act.
"These are proven programs that are vital in our effort to rebuild America's infrastructure -- and economy," said Ways and Means Ranking Member Sander Levin (D-MI). "The 48C Advanced Energy Manufacturing Tax Credit provides a direct incentive to manufacture advanced energy products like solar panels and wind turbines here in the United States and keeps the American renewable energy industry globally competitive. Renewing Build America Bonds will provide the financing necessary for state and local governments to rebuild crumbling infrastructure and schools. There is no excuse to delay action."
"As a former mayor, I know how important infrastructure tools are to lowering costs and making it possible for state and local governments to build and renovate schools, bridges, roads and hospitals - and the Build American Bonds program is at the top of the list in terms of its success.," said Rep. Richard Neal (D-MA). "In Massachusetts, the BABs program enabled the state to renovate a number of schools, including Holyoke High School, and improve our roads and bridges, including the Broad Brook Bridge in Easthampton, both of which I'll be visiting on Friday. Let's build upon this success and extend the BABs program."
"This energy tax credit will help make sure energy products like solar panels and wind turbines are made in America by American workers," said Rep. Mike Thompson (D-CA). "Adding incentives for companies to produce energy products domestically is good for our economy, environment and national security. It will create jobs, reduce our dependence on foreign oil and move us towards energy independence."
"Build America Bonds are more efficient than tax-exempt municipal bonds at subsidizing the financing activities of state and local governments. In New York alone, over $20 billion of Build American Bonds were issued by different entities such as the Triborough Bridge Tunnel Authority, the Metropolitan Transportation Authority and the NYC Municipal Waste Authority. Mayors from all over the country, including NYC Mayor Michael Bloomberg asked Congress to extend the Build America Bonds, yet the Republicans refused. Given our current fiscal situation, there's no excuse not to make the program permanent," said Ways and Means Chairman Emeritus Charlie Rangel (D-NY). "I also urge my colleagues to support the American Advanced Manufacturing Jobs Act of 2012, which is a common sense bill that will simultaneously create jobs at home while advancing our energy sustainability."
"Build America Bonds play a critical role in funding essential improvements projects to aging infrastructure in the East Bay while also serving as a boon to employment for our workers," said Rep. Pete Stark (D-CA). "In 2010, this included $84 million for the Hayward School District and $1.5 billion for Bay Area Toll Authority. We must renew this flow of federal funding that helps our communities thrive economically while keeping our infrastructure safe and updated. It's time to pass the Buy America Bonds Act of 2012 without delay."
"We've heard from employers and we've heard from industry -- these tax credits work and they create jobs," said Rep. Jim McDermott (D-WA). "Nearly every district in this country has benefitted from at least one of these provisons. They've built roads and bridges, fixed schools and sewers, and put us on the path to a clean energy future. The evidence is there, these two bills will make this country better, and failure by our Republican colleagues to pass these bills immediately would be, yet again, putting politics over the people."
"Smart investments in our nation's infrastructure and manufacturing industry will not only put us on the path to long-term economic growth but help ensure we maintain America's competitiveness now and in the future," said Rep. Ron Kind (D-WI).
"I am proud to support this legislation that would create good-paying jobs that can't be outsourced and put us on a path toward a cleaner, more secure energy future," said Rep. Shelley Berkley (D-NV). "Putting Nevadans to work remains my number one priority, and this bill aims to do exactly that while also getting rid of enormous taxpayer subsidies to big oil companies that are making record profits and don't need massive tax breaks."
"Created in the Recovery Act at a cost of under $5 billion, the Build America Bonds program has led to over $181 billion in new infrastructure investment and helped create jobs in every state in the country. New York City alone saw over $13 billion in new construction, from modernizing our mass transit system to funding an urban renewal project in Queens. Every member of the Ways and Means Committee -- on both sides of the aisle -- has seen their district benefit from this jobs-creating program," said Rep. Joe Crowley (D-NY). "Anyone who is serious about getting Americans back to work will join us in pushing to enact these two bills into law before the Republicans adjourn Congress for the summer."
The American Advanced Energy Manufacturing Jobs Act of 2012
This bill extends and expands the 48C Advanced Energy Manufacturing Tax Credit. It will uncap the credit for certain advanced manufacturing -- solar, fuel cell, battery -- and provide a $3 billion capped credit for other manufacturing. This tax credit program will help increase US clean energy manufacturing projects and expand manufacturing capacity to supply the world with US made parts and equipment. More manufacturing facilities will also support significant growth in exports of US manufactured clean energy products.
This bill is offset by repealing two provisions relating to major integrated oil companies. First, it would modify the rules that allow oil companies a foreign tax credit against their U.S. taxes to the extent that it pays income tax to a foreign government. Second, it would eliminate the expensing of intangible drilling costs.
The Build America Bonds Act of 2012
The Build America Bonds (BABs) program was created in 2009 by the American Recovery and Reinvestment Act and expired at the end of 2010. This bill restores BABs and makes them permanent. For 2012, the subsidy rate for the bonds is set at 32 percent. The subsidy rate is reduced by one percentage point each year until it reaches a permanent rate of 28 percent in 2016. BABs spur job creation and unleash private-sector investments by helping state and local governments finance infrastructure projects -- building schools, hospitals, transit systems, and water systems.
This bill is offset by repealing the Section 199 manufacturing deduction for major integrated oil producers. The Section 199 manufacturing deduction was designed to replace the old FSC/ETI regime, which oil and gas companies did not use. Yet in 2004, under the previous Republican majority, oil and gas companies were included in the replacement benefit. The Build America Bonds Act of 2012 would repeal the subsidy for major integrated oil companies, which continue to earn record profits quarter after quarter.