State and Local Governments Win Landmark Online Sales Tax Case

On Thursday in the South Dakota v. Wayfair case, the Supreme Court of the United States (SCOTUS) ruled that state and local governments can collect sales tax from vendors that do not have a physical presence in their state. In the 5-4 decision, SCOTUS offered three reasons why it ruled on the side of the localities and states: “First, the physical presence rule is not a necessary interpretation of the requirement that a state tax must be ‘applied to an activity with a substantial nexus with the taxing State.’ Second, Quill [v. North Dakota] creates rather than resolves market distortions. And third, Quill [v. North Dakota] imposes the sort of arbitrary, formalistic distinction that the court’s modern Commerce Clause precedents disavow.” The largest state and local government associations have applauded the decision, stating that “for 26 years Congress has failed to act and through the efforts of Justice Anthony Kennedy, the federal government has finally recognized the changing nature of commerce and state efforts to simplify the collection process.” Read more about it from the National League of Cities.

Sens. Alexander, Murray Introduce Bipartisan Legislation to Address “Urgent Opioid Crisis”

Senators Lamar Alexander and Patty Murray recently introduced a bipartisan bill to address the urgent opioid crisis in America. The Opioid Response Act of 2018 (S. 2680) is composed of forty proposals, mostly from members of the Senate Committee on Health, Education, Labor, & Pensions, that came from seven bipartisan hearings and feedback received from the public. The bill’s proposals include: improving data sharing among states so doctors and pharmacies know if a patient has a history of opioid abuse, making grants available that support state and local workforce boards and communities affected by the opioid crisis, and providing grants for states and localities to collect data and implement key prevention strategies. To learn more, read this summary of the legislation.  The committee expects to mark up the bill tomorrow morning.

Upcoming Brownfields Tax Legislation

Representatives Elizabeth Esty and Peter King joined forces to introduce the Brownfields Redevelopment Tax Incentive Reauthorization Act of 2018, as referenced in their “Dear Colleague” letter. If passed, the legislation would save a brownfields tax incentive that expired in January 2012. According to the letter, the bill would “reauthorize a tax incentive program that would allow developers to fully deduct the costs of environmental cleanups of brownfields in the year the costs were incurred.” The reauthorization is expected to encourage private sector investment to take on brownfields cleanup and redevelopment projects. NARC, the National League of Cities (NLC), the National Association of Counties (NACo), and the U.S. Conference of Mayors recently produced a letter urging Congress to pass the bill.

Farm Bill Advances from House Agriculture Committee

On April 18, the House Agriculture Committee passed the Agriculture and Nutrition Act of 2018 out of committee in a party-line vote. The strictly partisan vote resulted from many factors, including the bill’s proposed changes to the Supplemental Nutrition Assistance Program (SNAP) and the feeling from Democrats that they were left out of the bill drafting process. The Farm Bill is expected to face similar partisan pressure when it reaches the House floor, which could be as early as the week of May 7. Meanwhile, the Senate Agriculture Committee is expected to release their own Farm Bill next month. The Senate Agriculture Committee Chairman Pat Roberts has indicated that the Senate’s Farm Bill draft will not include the House’s SNAP provisions since they will be much more difficult to pass in the upper chamber. Concerns remain about the partisanship surrounding the Farm Bill and whether that will affect the passage of the legislation before it expires on September 30.

Last week, NARC signed onto a letter with the Campaign for Renewed Rural Development (CRRD) – a coalition of national policy advocacy organizations representing a broad spectrum of interests focused on rural issues – to highlight to the House Agriculture Committee the need for a robust Rural Development Title that provides critical investments to underserved communities and enhances rural America’s competitiveness in a global marketplace.

THUD Appropriations Member Day

The Transportation, Housing and Urban Development, and Related Agencies (THUD) Appropriations subcommittee had its FY 2019 Member Day yesterday. Several members applauded FY 2018 increases and urged the panel to protect infrastructure and housing programs and increase funding for FY 2019. Members also asked for support in their districts on specific issues, such as housing displacement from Louisiana floods and building Interstate 11 to link Las Vegas and Phoenix. Subcommittee Chairman Mario Diaz-Balart (R-FL) said he is very happy with the 2018 omnibus and that it will be a firm starting point for 2019.

FCC Ditches 2 Federal Reviews in 5G ‘Streamlining’

The Federal Communications Commission (FCC) approved a wireless infrastructure streamlining order last week to try to speed up American efforts in the race to 5G, exempting small cell deployments from federal historic preservation and environmental reviews. Now only states and localities that have their own review processes in place can mandate them. After a failed attempt to delay the vote for more input from tribal nations, environmental advocates, and local government officials, Commissioner Jessica Rosenworcel noted that streamlining the installation of 5G networks for the wireless industry will not guarantee improved access to underserved communities, such as rural areas and urban deserts. Read more in this Route Fifty article.

At Long Last, Congress and the President Fund FY 2018

After months of wrangling, five continuing resolutions, two short-term government shutdowns, and much argument over what funding levels and policy riders should make the final cut, Congress voted and the president signed an omnibus appropriations bill that will keep the federal government funded through the end of the current fiscal year on September 30, 2018.

The $1.3 billion appropriation represents a significant success for our members! Many of NARC’s 2018 legislative and funding priorities received substantially more funding than the president requested and more than was appropriated in fiscal year 2017. Areas that saw significant funding increases include:

  • Transportation and infrastructure, including TIGER Grants, AMTRAK funding, and autonomous vehicles;
  • Community Development Block Grant (CDBG);
  • Workforce Innovation and Opportunity Act (WIOA) state workforce formula grants;
  • Economic Development Administration (EDA);
  • Census Bureau;
  • Opioid crisis relief, including funding for prevention, treatment, and law enforcement;
  • Rural water and broadband programs;
  • Clean Water and Drinking Water State Revolving Funds;
  • Aging programs;
  • Low Income and Home Energy Assistance Program (LIHEAP);
  • HOME Investment Partnerships Program and other housing assistance programs; and
  • Homelessness assistance.

Several policy riders and authorizations were also adopted as part of the omnibus, including:

  • Reauthorization of the EPA Brownfields Program, including NARC supported language;
  • Reauthorization of the Federal Aviation Administration is now extended through September; and
  • Short-term reauthorization of the National Flood Insurance Program (NFIP) is extended through the end of July.

For more information, check out our new blog post on the FY 2018 omnibus appropriations bill.

2018 Omnibus Appropriations Bill Bolsters Many State and Local Programs

Following the release of the $1.3 trillion fiscal year 2018 omnibus appropriations bill on March 21, NARC staff has been combing through the 2,232 page document to learn how localities will be impacted by these federal program funding levels. Much of it is great news for regions! The bill proposes additional funding for so many of the priorities we have advocated for over the last year.

Here are a few highlights:

Transportation

TIGER Grants: The TIGER program increased to $1.5 billion, tripling FY 2017’s funding level of $500 million. It provides some planning money for the first time in many years, allowing for up to $15 million in planning grants. A minimum of 30 percent of the funds are reserved for rural areas, an increase from the current 20 percent requirement.

STBGP: FAST Act highway programs are fully funded, and the bill also includes a one-time increase of $198 billion for the Surface Transportation Block Grant Program (STBGP). The increase will be distributed as it is through the FAST Act, meaning that funds will be suballocated to local areas. The funds are only eligible for road, bridge, and tunnel projects, and the STBGP set-aside (TAP) is waived. The bill includes an additional amount for public/Indian lands and territories ($320 million), and a new competitive bridge program in states with densities of less than 100 persons per square mile ($225 million).

New Life for New Starts: While the administration proposed narrowing the Capital Investment Grants Program (New Starts) funding to only cover projects already underway, the omnibus agreement provides nearly $400 million for new projects. This is an overall increase of $232 million.

Transit: Transit receives full FAST Act funding with an additional $834 million in general fund appropriations, which includes funding for state of good repair grants, buses, and bus facilities.

Rail: The bill includes large increases for several Federal Railroad Administration programs, including Amtrak which will receive $1.9 billion (an increase of $447 million) with $650 million allocated for capital projects along the Northeast Corridor (an increase of $322 million). The bill also includes funding for three FAST Act rail programs that previously received far less than their authorized amounts: the consolidated grant program to support PTC installation ($593 million), the federal-state partnership state of good repair program ($250 million), and restoration and enhancement grants ($20 million).\

Extends FAA: The Federal Aviation Administration reauthorization is now extended through September.

Automated Vehicle Research: The bill repurposes funds to create a $100 million pot for study grants and implementation of an overall study program.

No Rescissions: The previous version of House and Senate bills would have rescinded contract authority, and an amendment by Representative Rob Woodall (R-GA) to the House bill would have made suballocated STBGP subject to rescission. Since this bill ditches the rescission, there is no need for the amendment.

Clearview Font: The bill temporarily prohibits the use of funds to enforce the termination of an Interim Approval to use the Clearview Font on highway signs and requires FHWA to conduct a “comprehensive review” of the research and report back to the House and Senate Appropriations Committees.

Aging Programs

ACL: The Administration for Community Living is funded at $2.171 billion, a $178 million increase from fiscal year 2017.

Senior Workforce: The Senior Workforce Development Program remains level at $400 million, rejecting the Trump administration’s proposal to eliminate the program and the House’s proposal to cut the program funding by 100 million.

OAA, Title III: The Older Americans Act (OAA) Title III programs received significant increases:

  • $35 million increase to OAA Title III B Home and Community-Based Supportive Services
  • $59 million increase to Title III C Nutrition Services
  • $5 million increase to Title III D Preventative Health
  • $30 increase to Title III E Family Caregiver Support

Census Bureau

Boost to Census Funding: The Census Bureau is funded at $2.8 billion, an increase of more than $1.344 billion from fiscal year 2017. Over $2.5 billion of that amount will be going to periodic censuses and programs, including efforts to continue preparations for the 2020 Census Survey.

Community and Economic Development

CDBG and HOME: The Community Development Block Grant Program (CDBG) is funded at $3.3 billion – the amount NARC and the CDBG Coalition requested. The HOME Investment Partnerships Program is funded at $1.362 billion, an increase of $412 million. The Trump administration proposed to eliminate funding for both programs in fiscal years 2018 and 2019.

SSBG & CSBG: The Social Services Block Grant (SSBG) and the Community Services Block Grant (CSBG) received level funding at $1.7 billion and $715 million, respectively.

State Workforce Formula Grants: Increased grants under Title I of the Workforce Innovation and Opportunity Act (WIOA) by a combined $80 million, including:

  • $30 million increase to WIOA Adult program
  • $30 million increase to WIOA Youth programs
  • $20 million increase to WIOA Dislocated Worker state grants

EDA: The Economic Development Administration (EDA) received a $25.5 million increase. This allocation ignores the Trump administration’s recommendation to eliminate funding for the agency.

Environment

Brownfields Authorization Language: The omnibus package contains the brownfields reauthorization language NARC has pushed for, including:

  • Allowing local governments to acquire abandoned or tax delinquent property that is contaminated and to clean up the property without fear of liability
  • Funding for brownfields cleanup grants
  • Creating a multipurpose brownfields grant
  • Allowing for the recovery of limited administrative costs

Urban and Community Forestry Program: The Urban and Community Forestry Program is funded at $28.5 million, an increase from fiscal year 2017. The omnibus package also includes a comprehensive fix for wildfire funding.

Energy

Energy Efficiency and Renewable Energy Program: The U.S. Department of Energy’s Energy Efficiency and Renewable Energy (EERE) Program is funded at $2.32 billion, a significant increase of $290 million. Rather than follow the Trump’s recommendations to cut the program by three-fourths, Congress chose to increase EERE’s funding by 14 percent.

LIHEAP: The Low-Income Home Energy Assistance Program is funded at $3.64 billion, a $250 million increase. This program has been slated for elimination by the Trump administration for fiscal years 2018 and 2019.

Flood Insurance

NFIP: The National Flood Insurance Program (NFIP) is giving a short-term reauthorization through the end of July, incentivizing Congress to complete a full reauthorization before the August recess.

Rural Development

New Broadband Loan and Grant Program: The U.S. Department of Agriculture (USDA) Rural Utilities Service received $600 million for a new broadband loan and grant pilot program.

Rural Development Programs: Rural development programs receive $3 billion, an increase of $63.7 million from fiscal year 2017. This includes decreases to the Rural Housing Service and Rural Utilities Service programs, which are funded at $1.99 billion and $661.4 billion respectively.

Substance Abuse Crisis

Opioid Crisis Relief: Includes a $3.2 billion increase for programs responding to the opioid crisis, including funding for prevention, treatment, law enforcement, and other purposes.

Water

Coastal Zone Management Funding: The Coastal Zone Management Program is funded at $75 million, a $5 million increase from the previous fiscal year.

USDA Water/Wastewater Loans: USDA’s Rural Water and Wastewater Program would allow more than $3 billion in loans, $1.8 billion more than the previous fiscal year.

Water State Revolving Funds: The omnibus package provides $2.89 billion in funding to Clean Water State Revolving Funds and Safe Drinking Water State Revolving Funds, an increase of $300 million for each program. The WIFIA loan program also saw an increase in funding this year, currently standing at $63 million.

What Happens Next?

The bill quickly passed through the House and the Senate, leaving one last hurdle: getting the president’s signature. Trump tweeted this morning that he is considering a veto because of two factors:

  • The bill presents no action on the Deferred Action for Childhood Arrivals (DACA)
  • The bill does not provide the full $25 billion the president requested to build a US-Mexico border wall.

On Thursday, March 22 White House Budget Director Mick Mulvaney told reporters that the president would sign the bill. The president has until midnight tonight to sign the bill to avoid a federal government shutdown. If he vetoes the bill and it goes back to Congress, a short-term continuing resolution might be employed to avert a shutdown and buy more time to discuss next steps.

UPDATE, March 23 at 1:30 PM ET:

In a White House press conference, President Trump signed the fiscal year 2018 omnibus appropriations package, making it public law. The legislation provides funding for the federal government through September 30, the end of fiscal year 2018. Although the president said, “there are a lot of things I’m unhappy about with this bill,” he approved the bill for national security reasons and because it authorizes a major increase in military spending. He criticized the rushed process Congress took to pass this bill, saying he would “never sign another bill like this again.”

Bipartisan Letter for Great Lakes Restoration Funding

Representatives Sander Levin (D-MI) and David Joyce (R-OH) submitted a joint letter to the House Appropriations Committee on Interior, Environment, and Related Agencies requesting an appropriation of $300 million for the Great Lakes Restoration Initiative (GLRI) for FY 2019. With 63 bipartisan co-signers joining the effort, this is the largest number of signers supporting GLRI funding. Representative Levin said, “The fact that the Great Lakes Restoration Initiative garners such strong, bipartisan support is a testament to the importance it has to our region and the nation. Our public health and regional economic vibrancy is built on the Great Lakes’ ecological wellbeing, which can only be maintained with our sustained and robust commitment.”