House Ways and Means Panel Advances Bipartisan, Bicameral Tax Package
January 25, 2024
On January 19, the House Ways and Means Committee overwhelmingly approved a tax package (H.R. 7024) that would, among other things, increase the Child Tax Credit (CTC) for very low-income families. Specifically, the bill – known as the Tax Relief for American Families and Workers Act – would increase the maximum refundable amount per child to $1,800 in tax year 2023, $1,900 in tax year 2024, and $2,000 in tax year 2025, with the value of the credit adjusted for inflation. It also includes provisions on the calculation of the refundable credit on a per-child basis and would allow the use of earned income from the prior tax year to calculate the maximum child tax credit, if earned income in the current tax year was less than the prior year.
On the housing front, H.R. 7024 would increase the state housing credits under the Low-Income Housing Tax Credit (LIHTC). Pursuant to the legislation, the LIHTC ceiling would increase by 12.5 percent (up from nine percent) through fiscal year 2025, allowing states to allocate more credits for affordable housing projects. Finally, the measure includes a provision that would exempt all wildfire relief payments since 2020 from federal income taxes. This includes a tax exemption for emotional distress, lost wages, legal fees, and additional living expenses.
Looking ahead, the full House will likely consider the bill next week, with Senate action also possible in the coming weeks.
Senators Padilla, Cassidy Introduce Legislation to Improve Local Evacuation Routes
Last week, Senators Alex Padilla (D-CA) and Bill Cassidy (R-LA) introduced legislation (S. 3605) – the Emergency Vehicle and Community (EVAC) Planning Act – that would support local evacuation routes and planning. Specifically, the bill would direct the Department of Transportation, in consultation with the Federal Emergency Management Agency (FEMA), to develop and publicly disseminate guidance and best practices for States, territories, Indian Tribes, and local governments to utilize when conducting local emergency evacuation route planning, both for evacuating communities and bringing in emergency personnel and supplies. It should be noted that Senator Padilla successfully offered similar language as an amendment to the Senate’s fiscal year 2024 Transportation-HUD spending bill.
Senators Padilla, Murkowski Introduce Legislation on Earthquake Resilience
Last week, Senators Padilla and Lisa Murkowski (R-AK) introduced bipartisan legislation (S. 3606) that would reauthorize the National Earthquake Hazards Reduction Program (NEHRP). Specifically, S. 3606 would authorize $175.4 million annually through fiscal year 2028 across the four federal agencies responsible for long-term earthquake risk reduction – namely, FEMA, the National Institute of Standards and Technology (NIST), the National Science Foundation (NSF), and the United States Geological Survey (USGS). The funding would support research, development and implementation activities related to earthquake safety and risk reduction. In addition, the legislation would direct state and local entities to inventory high-risk buildings and structures. It also seeks to improve mitigation for earthquake-connected hazards.
FEMA Proposes Reforms to Individual Assistance Program
On January 19, FEMA published an Interim Final Rule (IFR) to reform the Individual Assistance program. The new policies, which will take effect on March 22, are designed to increase equity by simplifying processes, removing barriers to entry, and increasing eligibility for certain types of assistance under the program. In short, the proposed changes will lead to a larger pool of eligible disaster survivors receiving disaster assistance funds.
Among other things, the IFR would:
- Establish a Serious Needs Assistance Cash Relief Program: FEMA will provide immediate financial support for disaster victims by replacing the Critical Needs Assistance program with a cash relief program called Serious Needs Assistance. The agency will provide a $750 payment for households with serious needs, which will help cover immediate expenses related to sheltering, evacuation, and meeting basic household needs. This payment would be in addition to other eligible assistance that may be provided to survivors based on their unique circumstances.
- Establish a Displacement Assistance Benefit: FEMA is creating a new benefit called Displacement Assistance. This assistance is designed for survivors who cannot return to their home following a disaster. It will provide eligible survivors with up-front funds to assist with immediate housing options of their choice, such as costs associated with staying with family and friends, until they are able to secure a rental option to focus on their long-term recovery.
- Remove Loan Application Requirements: FEMA will remove the requirement to apply for a U.S. Small Business Administration (SBA) loan before being considered for certain types of financial assistance. This change will simplify the disaster assistance process and give survivors the ability to apply for help from FEMA and SBA at the same time.
- Help Underinsured Survivors: FEMA is streamlining insurance-related rules to help survivors who do not receive enough assistance from their insurance company to cover their rebuilding costs.
- Simplify Assistance for Entrepreneurs and Gig Workers: FEMA is simplifying the process so entrepreneurs, gig workers and other self-employed individuals can more easily reopen their businesses after a disaster.
- Allow for Accessibility Improvements: Survivors with disabilities can use FEMA funding to make certain accessibility improvements to homes damaged by a declared disaster.
- Simplify the Application Process: The new rules will remove barriers for late applicants, streamline temporary housing assistance applications, and simplify the process for appeals.
California Lawmakers Introduce Legislation to Improve Post-Disaster Trail Maintenance
Last week, Representatives Young Kim (R-CA) and Doug LaMalfa (R-CA) introduced a bill (H.R. 6994) – the Restoring Our Unopened Trails for Enjoyment and Safety (ROUTES) Act – that would prioritize, streamline, and improve maintenance of federal trails, roads, campgrounds, and recreation sites damaged by certain natural disasters. The ROUTES Act would require National Forest trails, roads, campgrounds, and recreation sites damaged and closed by natural disasters to be restored and reopened within two years of the disaster. To meet this deadline, certain actions to restore these sites – such as renovating trails and removing hazard trees – would not be subject to an environmental assessment.
House Panel Advances Outdoor Recreation Package
Last week, the House Natural Resources Committee advanced a bipartisan outdoor recreation package – the EXPLORE Act (H.R. 6492). Among other things, H.R. 6492 aims to modernize visitor experiences, streamline the permitting process for small businesses relying on public land access, and improve accessibility for various groups including sportsmen and women, military service members, veterans, individuals with disabilities, and children. The bill also focuses on protecting rock climbing areas, creating new bike trails, restoring campgrounds, and modernizing infrastructure while supporting gateway communities by addressing housing shortages and outdated infrastructure. A section-by-section summary of the legislation can be accessed here.