Filtered by category: Legislative Clear Filter

NAIOP NC Visits Raleigh

Posted on June 6, 2018

On May 30, 2018, the three chapters of NAIOP North Carolina, visited capitol hill to advocate.  A special thanks to Jason Moore (Charlotte Legislative Committee Chair) and Joe Padilla (REBIC) for helping coordinate visits with legislators to speak about the commercial real estate perspective.  While this is a short session (this means the time of the session is short, but also that new legislation cannot be introduced), it is of critical importance the state senators and representatives know who NAIOP is and what we represent. 

The key areas of discussion are around regulatory reform, economic development and tax reform.  To view the NAIOP NC 2018 Legislative Priorities, click here.  A special thanks goes to the following legislators that took their time to meet with us directly:

  • Chris Thomas
  • Jason Moore
  • George Lyles
  • Jim Gamble
  • Tim Robertson

   

Banking Bill Includes HVCRE Revisions

Posted on May 25, 2018

Yesterday, President Donald Trump signed the Economic Growth, Regulatory Relief, and Consumer Protection Act into law. This reform legislation includes NAIOP-supported provisions that ensure there is adequate capital availability for commercial construction financing.

The bill requires banking regulators to revise elements of the current High Volatility Commercial Real Estate (HVCRE) designation that unfairly targeted commercial construction lending, including:

  • Allowing commercial borrowers to use the appreciated value of contributed land, rather than the original cost as under the prior rule.
  • Limiting the application of the HVCRE classification by clarifying that loans made to acquire existing property with rental income would not be subject to higher capital requirements.
  • Allowing banks to remove the HVCRE designation prior to the end of the loan.

Revision of the HVCRE designation was an important element of NAIOP's 2018 agenda, and enactment of this important legislation is a major victory for NAIOP's members. We commend the president and the bipartisan coalition of lawmakers who worked to deliver this measure.

Supreme Court Considers Changing Internet Sales Tax Policy

Posted on May 4, 2018

The Supreme Court is expected to issue a decision by the end of June in South Dakota v. Wayfair, Inc., et al, a case that could change how sales taxes are collected on Internet purchases.

Two years ago, South Dakota passed a law that would require out-of-state companies to pay sales taxes if they sold more than $100,000 worth of goods or made 200 separate sales transactions in the state. The law was designed as a direct challenge to the Supreme Court’s 1992 ruling in Quill Corp. v. North Dakota, which blocked states from collecting sales taxes from Internet retailers if those retailers don’t have a store, warehouse or sales staff physically present in the state.

NAIOP supports the collection of existing sales and use taxes from online retailers that are already owed to state and local governments. Not doing so puts brick-and-mortar retailers at a disadvantage to out-of-state vendors whose purchasers can avoid taxes.

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REBIC Primary Election Voter Guide is Now Available

Posted on April 24, 2018

The REBIC Primary Election Voter Guide is now available. View below or click here to view.

US Administration Continues Infrastructure Proposal Push

Posted on April 9, 2018

Last week, President Donald Trump hosted a campaign-style event in Ohio to discuss his infrastructure plan. The White House Council of Economic Advisers says that, if implemented, the plan could put more than 400,000 people to work over the next decade. Infrastructure and transportation is a legislative priority for NAIOP in 2018.

Trump says he’d settle for a series of smaller bills instead of a single, sweeping bill. Infrastructure improvements could "be passed in one bill or in a series of measures," the president told reporters last week.

That’s important because many observers doubt Congress will be able to agree on any single major bill before the November election. Still, administration officials promise to keep working on the issue. "We will have a push, a strong push to have infrastructure done this year," a senior administration official told CNN. "We hope to get a big chunk done this year."

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Senate Passes Dodd-Frank Reform, Aims to Clarify HVCRE Policies

Posted on March 27, 2018

Senators took a positive step last week, with an overwhelming vote to begin reforming the 2010 Dodd-Frank banking law. The measure, S. 2155, passed on a 67-31 vote, with support from members on both sides of the political aisle.

A key component of the reform measure is a NAIOP-supported provision aimed at improving the regulatory process involving High Volatility Commercial Real Estate (HVCRE) loans. The HVCRE rule, which has resulted in confusion among lenders and borrowers, was originally put into place by the Basel III committee on international banking supervision and was adopted by U.S. banking regulators. 

“The current HVCRE rule is overly broad and forces banks to hold unreasonably high capital levels before they may make certain loans,” said Thomas Bisacquino, NAIOP president and CEO. “We commend the Senate for passing a measure addressing the problem by providing greater clarity on the HVCRE issue.”

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Crunching the Numbers on the 2018 Tax Law for CRE

Posted on March 13, 2018

A recent Advantage Series webinar helped members understand the implications of the new 2018 Tax Reform law, thanks to Crystal Christenson of the accounting firm Wipfli, LLC.

Catch a recap on the Market Share blog and listen to the archived webinar.

Congress Takes Action to Slow "Drive-by" Lawsuits

Posted on February 26, 2018

Last week, the House of Representatives passed H.R. 620, a bill to improve the Americans with Disabilities Act (ADA) by reducing opportunities for people to file nuisance lawsuits under the law. The legislation, which allows property owners to fix any alleged violations while keeping penalties in place for businesses that remain in noncompliance, passed 225-192 and will now move to the Senate.

The measure is aimed at eliminating so-called “drive-by lawsuits,” a tactic used by some “unscrupulous trial lawyers,” as House Judiciary Committee Chairman Bob Goodlatte (R-VA) called them, whose lawsuits, he said, “[divert] money from accessibility where it belongs.” As documented in a 60 Minutes report last year, some lawyers cruise around local communities in an attempt to spot minor ADA infractions at offices, gas stations, malls and other locations. In some cases, these lawyers don’t even bother to leave their homes, and instead use aerial images from Google Maps to target alleged violators.

H.R. 620 requires that anyone making a complaint against a business must file a written complaint. It gives the business owner 60 days to fix any violation, and up to an additional 60 days if the owner is acting in good faith and can demonstrate substantial progress toward making the changes. Owners who refuse to address violations could be sued.

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Congressional Budget Deal Contains Big Policy Wins for Real Estate

Posted on February 20, 2018

The federal budget deal signed by President Trump contains a number of wins for real estate, including a temporary extension of federal flood insurance and extension of tax provisions that include relief from debt forgiveness, the deductibility of mortgage insurance premiums, and several energy-efficiency related provisions.

Flood Insurance

Extends the National Flood Insurance Program until March 23, giving lawmakers time to work on longer term reauthorization and reform legislation. It also adds $27 billion in mitigation and resiliency funds to address issues arising from last year's hurricanes. The extension makes $12 billion available under the Community Development Block Grant (CDBG) program to fund U.S. Army Corp of Engineers flood mitigation projects.

Click here to read more.

U.S. House Approves Brownfields Legislation

Posted on December 27, 2017

On November 30, 2017, the U.S. House of Representative passed H.R. 3017, the Brownfields Enhancement, Economic Redevelopment and Reauthorization Act of 2017, which would allow up to $250 million annually to clean up brownfield sites during 2018-2022. The legislation, sponsored by Congressman David McKinley (R-WV), seeks to assist communities in restoring the contaminated land to productive use.

Click here to read the full article.

Victory for CRE in Tax Reform

Posted on December 19, 2017

Last Friday, House and Senate negotiators came to an agreement on what is sure to be far-reaching reform of our existing tax code. The Tax Cuts and Jobs Act will be voted on this week and is expected to pass and be signed by President Trump.

This legislation, when passed, represents an important victory for NAIOP members and the commercial real estate industry. For many years, the debate surrounding tax reform gave rise to ideas that would have caused long-term damage to our industry, including the elimination of 1031 like-kind exchanges, ending capital gains tax treatment for real estate carried interests, and not allowing deductibility for interest payments on the financing for real estate projects.

The active involvement of NAIOP members and NAIOP's legislative team in this important public policy debate helped shape the final product to ensure that commercial real estate remains a vibrant contributor to our nation's economy. This tax reform legislation will:

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A message from NAIOP’s Legislative Team

Posted on December 8, 2017

NAIOP's legislative team is committed to keeping you informed throughout this historic tax reform legislative process with progress updates and what the legislation means for the commercial real estate development industry.

The Senate has taken a significant step toward achieving comprehensive tax reform by passing its version of the Tax Cuts and Jobs Act. This week, the House and Senate will meet in conference to iron out the differences between the two versions.

Both the Senate and House versions of the bill include matters important to our industry, including:

  • Maintaining Section 1031 like-kind exchanges for real estate.
  • Maintaining the deductibility of interest on debt for those involved in real property trades or businesses, including CRE development.
  • Preserving capital gains tax treatment of carried interest for real estate practitioners, but requiring that assets be held for three years or more. Senate amendments that would have eliminated capital gains treatment for carried interests completely were defeated.
  • Reducing corporate tax rates to 20 percent from the current 35 percent, not taking effect until 2019 in the Senate proposal.
  • Limiting state and local taxes deductions to property tax and capping it at $10,000; the original Senate proposal would have eliminated it completely.
  • Doubling the estate and gift tax exemption levels (with inflation adjustments) from the current $5.49 million for individuals or $10.98 million for married couples.  The Senate version would not completely repeal the estate tax; the House version phases it out entirely by 2024.

While the Senate amended its original version to bring it more in line with provisions included in the House bill, several important differences remain, including:  

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Tax Reform Measures Taking Shape in Congress

Posted on November 16, 2017

Last Thursday, the Senate Finance Committee released draft tax reform legislation that they will move through committee later this week. The Senate bill was released after the House Ways and Means Committee passed its version of tax reform earlier that day.

The Senate draft differs in some aspects from the initial House version, which NAIOP President and CEO Thomas Bisacquino detailed last week in terms of its impact on the commercial real estate industry. Overall, both bills continue taxing commercial real estate development and investment on an economic basis, recognizing the long-term, capital-intensive nature of the industry.

Importantly, both bills would preserve the use of 1031 exchanges and continue the deductibility of business interest expense for the commercial real estate industry. Both would also lower corporate tax rates to 20 percent. Under the Senate bill, however, the rate reduction would be delayed until 2019. Some other differences of note for commercial real estate include:

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Tax Reform's Effect on CRE

Posted on November 3, 2017

House leaders took a significant step forward with tax reform efforts on Thursday with the release of the Tax Cuts and Jobs Act, H.R.1, which includes an expansive set of proposed changes to the corporate and individual tax system.

As promised in my previous messages to you on this topic, our legislative team and I are committed to keeping you informed on tax reform developments affecting the commercial real estate industry. In this proposal:

  • Section 1031 like-kind exchanges are preserved for real estate.
  • Current tax treatment of carried interest is preserved.
  • Deductibility of interest on debt is maintained for those involved in real property trades or businesses, including commercial real estate development.
  • Current eight individual tax brackets are condensed into four brackets: 12 percent, 25 percent, 35 percent and 39.6 percent. The top rate of 39.6 percent would apply to income levels of more than $500,000 for an individual and $1 million for couples.
  • Corporate tax rates are reduced from the current 35 percent to 20 percent.
  • Pass-through businesses (such as partnerships and limited liability companies) will pay a new, lower top rate of 25 percent on their business income, subject to certain restrictions.
  • Alternative Minimum Tax (AMT) is eliminated.
  • Estate tax threshold is doubled (from the current $11.2 million for married couples), and phased out entirely by 2024. The step-up in cost basis on assets is retained.
  • Deduction for state and local taxes limited only to property tax and capped at $10,000. (Currently, state and local income and sales taxes can also be deducted.).
  • The Historic Preservation Tax Credit and New Markets Tax Credit are discontinued, with transition periods provided. As legislation moves forward in the House and Senate, NAIOP will advocate for the continuation of these important incentives.

Starting next Monday, the House Ways & Means Committee will begin marking up the legislation. The president has expressed his desire to accelerate tax reform and sign a bill before the end of the year.

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Get Out and Vote! - REBIC Election Guide

Posted on October 23, 2017

REBIC has put together an Election Guide to help you cast your vote for candidates who support the real estate industry.

See which candidates REBIC has endorsed

Tax Reform Provisions Important to CRE

Posted on October 9, 2017

Below are some details on the recently released Unified Framework for Fixing Our Broken Tax Code, in which the Trump administration and congressional Republican leadership have outlined chief areas of agreement for tax reform legislation.

While House and Senate GOP leaders and members of President Trump's economic team left many details of the legislation for the tax-writing committees in both chambers to resolve, there are several agreed-upon major provisions of interest to CRE:

  • Reduction of the number of tax brackets from seven to three: 12, 25 and 35 percent, leaving open the possibility of an additional higher bracket for the highest-income taxpayers to ensure the share of taxes paid by the wealthy remain the same.
  • Reduction of corporate tax rates to a maximum of 20 percent, down from the current rate of 35 percent.
  • A top rate of 25 percent applied to the business income of small and family-owned businesses conducted as sole proprietorships, partnerships and S corporations (pass-through entities). The framework contemplates that the committees will adopt measures to prevent any recharacterization of personal income taxed at ordinary rates into business income taxed at the lower pass-through rate, done solely for purposes of avoiding taxation.
  • Immediate expensing for new investments in capital assets, not to include structures, but leaving open the possibility for increased expensing for small businesses and modernizing current depreciation schedules for assets not provided immediate expensing.
  • Partial limitation for deductibility of interest expenses for C corporations, asking the committees to consider the appropriate levels of deductibility for other types of businesses.
  • Elimination of the Alternative Minimum Tax.
  • Repeal of the Estate Tax.

We believe that these provisions will spur stronger economic growth and job creation, benefitting our industry in the long term, but many questions remain unanswered.

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Budget First, Tax Reform Next

Posted on October 6, 2017

Lawmakers in the House and Senate say they’re determined to pass a sweeping tax reform bill this year. But first, for procedural reasons, both houses need to pass a Fiscal Year 2018 budget. FY 2018 began on October 1.

Republicans on the Senate Budget Committee released a draft budget that it says would balance within nine years. But committee members haven’t explained where they would find $5 trillion in spending cuts. That draft budget will be voted on by the full Budget Committee this week, then go to the floor of the Senate later this month. The House drafted a budget plan over the summer and plans to hold a vote on Thursday.

After the two chambers come to an agreement on budgetary spending levels, lawmakers would be able to turn to tax reform, which is a key priority for NAIOP. Throughout the year, NAIOP has met with lawmakers and Hill staffers to deliver the message that all federal spending and tax reform bills should protect the interests of the CRE industry.

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Busy Time for Tax Reform Writers

Posted on September 25, 2017

Lawmakers are focusing their attention on tax reform this month. The Senate Finance Committee will hold a hearing this week to collect testimony about business tax reform proposals. That follows a similar session last week to discuss individual reform.

For his part, House Speaker Paul Ryan promises to release details of a tax reform plan by September 25. “The outline will represent a consensus between the two tax-writing committees in Congress, the House Ways and Means Committee and the Senate Finance Committee, and the Trump administration,” Bloomberg reported.

President Donald Trump says the final tax measure should draw bipartisan support, and he’s met with leading Democrats including Sen. Charles Schumer and House Minority Leader Nancy Pelosi to discuss taxes and other issues. “More and more, we’re trying to work things out together,” Trump said during a meeting with moderates from both parties.

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Tax Reform is Imminent: NAIOP Update

Posted on September 21, 2017

With 24/7 coverage of ongoing global events dominating the news cycle, it's easy to lose sight of what's happening with U.S. legislation critical to our industry.

Tax reform negotiations are imminent: House Speaker Paul Ryan has promised to release an outline of a tax reform plan the week of September 25, followed by negotiations between the House, Senate, and administration.

This is the first major tax reform in more than three decades, and the stakes for commercial real estate are high. We have been closely working with Congress to ensure legislative programs and incentives critical to our industry are carefully considered throughout the negotiation process, including:

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Senate Approves Extension of National Flood Insurance Program

Posted on September 12, 2017

On Thursday, September 7, the United States Senate voted to pass a three-month extension of the National Flood Insurance Program (NFIP). The House of Representatives is expected to pass the legislation on Friday, September 8, 2017, and the President is expected to quickly sign the bill into law later in the day.

This legislation ensures that the NFIP will not lapse on September 30, 2017, and will be extended until December 8, 2017.

Source: National Association of Realtors® (NAR)