Federal Advocacy Update: Week Ending November 19, 2016

Washington D.C. building
Washington D.C. building

In this issue:

What's Next? Lame-Duck and the First 100 Days

Michael Wallace, 202.626.3025

The results of the 2016 elections are in, and local leaders have a message for Washington: Cities Lead. NLC hosted the nation's first large post-election gathering of local elected officials from across the country at the annual City Summit, in Pittsburgh, Pa., this week. NLC members of every political stripe came together in meetings and workshops to analyze the results and discuss how cities and towns will influence the new Congress and incoming Administration. At the same time, we continue to focus on the unfinished business of the current Congress over its final lame-duck session.

This week, Congress returned to Washington in order to complete deliberations over FY 2017 appropriations bills before the December 9 deadline. In addition to advocating for funding for city priorities during this lame-duck session, NLC continues to call on Congress to pass e-fairness legislation, send the Water Resources Development Act (WRDA) and legislation reauthorizing the EPA brownfields program to the President's desk before the end of the year, and continue our work to protect the tax exemption for municipal bonds.

Looking ahead to 2017, for cities the federal elections mean a new political landscape that will affect our advocacy efforts. To help cities understand the changing political landscape, NLC's Federal Advocacy team hosted a webinar for local officials to analyze the federal election results. In the first 100 days of the new Administration, NLC will lead the drumbeat, started by our Cities Lead 2016 campaign, to ensure that federal officials understand that city issues are America's issues, and that cities are centers of innovation, opportunity, and economic growth. To view a recording of the webinar, click here.

As with any presidential transition, an early and strong advocacy effort will be necessary to keep city priorities on the national agenda. In the coming weeks, NLC will be calling on local officials across the country to add your voice to our advocacy efforts, both in Washington and at home. One of the best ways to contribute and help shape NLC's efforts to proactively drive federal policy on issues that matter the most to cities is to join one of NLC's seven Federal Advocacy Committees. Applications for Committee membership are open until November 23. Click here to learn more and apply.

In addition to joining a Federal Advocacy Committee, a great way to become more involved in NLC's advocacy efforts and make a difference for cities is by joining our advocacy network email list. Throughout the year, we'll call on advocates to take action in support of the issues that matter the most to cities and make sure local leaders voices are heard loud and clear in the halls of Congress and with the new Administration. Click here to sign-up today.

Federal Funding for Local Grants at Risk under Immigration Proposals

Yucel Ors, 202.636.6124

Federal funding for local grant programs important to cities and towns, such as CDBG and Justice Assistance Grants, continue to be targeted by lawmakers engaged in the debate over immigration policy. Legislation targeting so called "sanctuary cities", such as the Stop Sanctuary Policies and Protect Americans Act (S. 3100), would require federal agencies to withhold grants from local governments that have policies in place to protect local law enforcement officers from being co-opted as immigration enforcement agents by the federal government. The Stop Sanctuary Policies and Protect Americans Act was rejected by votein the Senate earlier this year following the opposition of NLC and a coalition of government and community stakeholders.

It is NLC's long-standing position that, while local law enforcement officers have a responsibility to cooperate with the federal government to apprehend specific persons who commit a crime and violate U.S. immigration law, this should not include responsibility for enforcing federal immigration laws or the ongoing detention of individuals merely suspected of violating those laws.

Federal efforts that shift the responsibility of enforcing federal immigration law from the federal government to local governments would further divert critical resources from their law enforcement agencies. Such provisions also risk impeding local law enforcement's ability to work with immigrant communities in preventing and solving crimes and, ultimately, compromising the public safety such provisions seek to improve.

Last month, the U.S. Department of Justice issued additional guidance for cities seeking clarity regarding existing local responsibilities under current federal law.

Instead of punitive measures such as these, NLC continues to call on Congress to fix the nation's broken immigration system by passing comprehensive immigration reform.

NLC Weighs in on CPP Local Energy Program

Carolyn Berndt, 202.626.3101

Earlier this month, NLC submitted comments to the U.S. Environmental Protection Agency (EPA) on the design of the Clean Energy Incentive Program (CEIP) to support the development of renewable energy and energy efficiency projects in cities, particularly in low-income areas. The CEIP is a voluntary, early-action component of the Clean Power Plan (CPP) that will encourage investments in renewable energy and incentivize energy efficiency and solar projects in low-income communities as eligible means of meeting state compliance goals.

As EPA is considering how to set up the CEIP, NLC offered several recommendations, including to allow cities to take advantage of the CEIP program even if their state opts not to participate, to develop guidance for states to consult with cities and other entities throughout the state's process of both opting into the CEIP program and through the design and implementation of the state's plan, to remove the proposed prohibition on wind and solar projects and low-income energy efficiency projects that receive other federal tax credits from being eligible for CEIP credits, and to include the U.S. Department of Housing and Urban Development's (HUD) affordable housing definition of households earning less than 80 percent of Area Median Income among the four pre-existing federal and state definitions of "low-income community" as presumptively acceptable.

The Clean Power Plan will reduce carbon emissions from power plants by 32 percent below 2005 levels by 2030. Implementation of the Clean Power Plan, including the CEIP, is critical as cities move forward in reducing greenhouse gas emissions through clean energy and energy efficiency incentives.

Cities Urge Administration Not to Tax Water Efficiency Rebates

Carolyn Berndt, 202.626.3101

Last month, more than 120 local elected officials and municipal water leaders signed a letter to the White House seeking its engagement with the Internal Revenue Service (IRS) to clarify that water efficiency and green infrastructure rebates should not be considered taxable income. Federal taxation of these local government rebates would serve as an impediment to local efforts to increase water supply resilience, limit pollutants in waterways, and keep water affordable for citizens.

Communities across the country have policies and programs in place to encourage water conservation and efficiency. As these water rebate programs have grown in popularity, there has been significant uncertainty at the local level as to how the IRS will treat these rebates, raising the question as to whether such programs might subject agencies to penalties for failure to issue 1099s to participating consumers. Cities urge the IRS to exercise its administrative discretion to provide clarity as to whether a subsidy should be treated as taxable income.

In addition to the letter, two of the letter's signatories, San Clemente Mayor Bob Baker and Long Beach Board of Water Commissioners President Art Levine, authored an op-ed in the San Francisco Chronicle to advocate for IRS action to clarify that local rebate programs are not taxable.

NLC Urges Action on WRDA and Brownfields in Lame Duck Session

Carolyn Berndt, 202.626.3101

As Congress comes back to Washington this week, NLC urged House and Senate leaders to reach a conference agreement and pass legislation on two key NLC priorities: the Water Resources Development Act (WRDA) and a comprehensive energy bill that would also reauthorize the U.S. Environmental Protection Agency Brownfields program.

Water Resources Development Act
The House and Senate passed their WRDA bills with broad bipartisan support to authorize flood protection, navigation, and ecosystem restoration projects under the U.S. Army Corps of Engineers. In a last-minute agreement between House and Senate Republican and Democratic leaders, the House agreed to $170 million to address the ongoing drinking water crisis in Flint, Mich. In addition to the traditional Army Corps projects, the Senate bill includes additional provisions for wastewater and drinking water infrastructure, as well as an aid package for Flint.

NLC urges House and Senate leaders to include these important provisions in a final WRDA bill and to send the bill to the President for signature before the end of the year.

Energy Bill and Brownfields Reauthorization
The comprehensive energy bills that passed the House and Senate this year aim to address important national energy challenges, including energy efficiency, infrastructure, and supply. NLC supports energy efficiency provisions that would strengthen the opportunities to improve the energy efficiency of residential and commercial buildings, as well as schools. NLC specifically supports a provision that would provide lenders and homeowners with more flexible federal mortgage underwriting rules that would include a home's expected energy cost savings when determining the value and affordability of the home.

Brownfields reauthorization legislation passed the Senate on two occasions this year. In April, it was included as an amendment to the bipartisan energy bill (S. 2012). Additionally, standalone legislation passed the Senate in June. The language is the same in both bills and would authorize funding for multipurpose grants, increase funding levels for remediation grants, increase technical assistance for communities, and allow local governments to be eligible for grant funding for properties that were acquired prior to the January 11, 2002 enactment of the Brownfields Revitalization Act. Without standalone legislation in the House, the best chance for passing a brownfields reauthorization this year is in conjunction with the energy bill.

NLC recently sent a letter to energy bill conferees urging passage of a final energy bill that supports local energy efficiency initiatives and local redevelopment efforts of brownfields properties.

Overtime Rules To Go Into Effect Unless Congress Acts

Stephanie Martinez-Ruckman, 202.626.3098

In May, the U.S. Department of Labor (DOL) announced publication of the final rule updating overtime regulations under the Fair Labor Standards Act. The proposed rule, set to go into effect on December 1, doubles the minimum salary threshold under which an employee is entitled to overtime pay to $47,500 and establishes a mechanism for automatically updating salary and compensation every three years. NLC supports modernizing the overtime rules, but has concerns about its fiscal impact. This change will make millions of previously ineligible employees eligible for overtime pay and will significantly impact local governments, which are a major employer in cities and towns across the United States.

In September, 21 states and over 51 business groups filed lawsuits challenging the Administration's new overtime rule and seeking a temporary and permanent injunction that would block implementation of the rule on several grounds, including that it violates the 10th Amendment. Concurrently in the House and Senate, there are four pieces of proposed legislation that would delay and repeal portions of the law. During the lame-duck session, Senator Alexander (R-TN), chairman of the Senate Health, Education, Labor and Pensions Committee, hopes to gain momentum behind the Overtime Reform and Review Act (S. 3463). NLC will support these legislative efforts and, should the December 1 deadline arrive without any action, NLC will continue to advocate for changes to the automatic three-year update.

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