Workforce Program Wins in FY23 Budget

Just after midnight on Tuesday, Dec. 20, Congressional leadership released the text of the FY2023 omnibus spending bill, which will fund federal government operations through Sept.30, 2023.

The 4,155-page spending bill comes in at over $1.6 trillion, split between $772 billion in non-defense spending and $858 billion for the military. The Senate will vote first on the legislation before sending it to the House and, upon passage, it will arrive at the White House in time for the president’s signature before the current continuing resolution funding government expires at midnight on Friday, Dec. 23.

PHCC legislative affairs worked tirelessly since late summer for inclusion of the National Apprenticeship Act in the final spending package. They also advocated for the inclusion of the JOBS Act, which would funnel Pell Grant monies to short-term job training programs that would create another avenue to careers in the HVAC space. However, neither the JOBS Act nor the National Apprenticeship Act was included in the final spending bill due to pressure to minimize non-defense legislative priorities.

HOWEVER, there have been substantial increases in workforce funding expected to benefit newcomers to the plumbing and HVAC trades. The Department of Labor’s registered apprenticeship program will be funded at $285 million, its highest level of funding ever. Additionally, Workforce Innovation and Opportunities Act (WIOA) grants will be funded at over $2.9 billion, providing money to fund training programs in high-demand fields such as HVAC and plumbing (the article below is for PHCC state executives wanting to learn more about how they can leverage WIOA). Perkins Career and Technical Education grants will be funded at $3.5 billion, helping secondary school students explore the building trades as a career option.

By Mark Valentini, Director of Legislative Affairs

PHCC National is always working on your behalf! Recent or upcoming legislative/regulatory events:

Nov. 15 — PHCC Legislative Affairs meets with office of Sen. Tammy Baldwin (D-WI) to discuss National Apprenticeship Act.

Nov. 17 — PHCC Legislative Affairs meets with Senate Health Education Labor and Pensions (HELP) committee staff to discuss National Apprenticeship Act.

Nov. 18 — PHCC Legislative Affairs meets with offices of Sens. Tim Kaine (D-VA) Maggie Hassan (D-NH) and Ben Ray Lujan (D-NM) to discuss National Apprenticeship Act.

Nov. 18 — Oral arguments in HARDI et al v. EPA challenging EPA authority to mandate reusable refrigerant cylinders. PHCC is a party to this lawsuit.

Nov. 24 - 25 — PHCC Offices Closed for Thanksgiving

Nov. 29 — PHCC Legislative Affairs meets with office of Sen. Jacky Rosen (D-NV) to discuss the National Apprenticeship Act.

Nov. 30 — PHCC Legislative Affairs meets with Sen. John Kennedy (R-LA) to discuss ratification of Kigali Amendment and impact on HVAC industry.

Inflation Reduction Act: The Tradeoffs Aren’t Worth It

On August 11, 2022, the PHCC National Board of Directors voted to oppose the Inflation Reduction Act (IRA), the watered-down version of the Build Back Better plan. 

Nonetheless, the House of Representatives voted to approve the bill on Friday evening on a 220-207 partisan vote, after the Senate approved the bill the prior week on a 51-50 vote with Vice President Kamala Harris casting the tie-breaking vote. The President is expected to sign the bill into law today.

PHCC legislative staff is looking through the 700+ page bill to understand its full impact on contractors. Below is what has been learned about the pros and cons of this bill thus far.

What we like:

• There are tax incentives for contractors that perform work improving the energy efficiency of their customers’ homes and businesses, and tax credits have been increased for homeowners and business owners that invest in energy-efficient HVAC systems.
• Restrictions that limited those tax benefits only to those consumers that hired a contractor that uses apprentices and pays prevailing wage have been lifted, meaning customers can hire any qualified contractor to perform the work and be able to claim it on their tax returns.
• It intends to streamline the permitting process for oil and gas exploration, which means Americans can theoretically start leveraging more American resources to reduce our dependence on foreign oil and reduce energy costs.
• Upon the President’s signage, PHCC will keep you up to speed on how you and your customers can take advantage of these tax incentives. PHCC does not offer tax advice and you are highly encouraged to consult with a tax professional.

Tradeoffs that did not make this legislation worthy of our support:

• There are over $6 billion in taxes on natural gas exploration, and financial incentives for state governments and utilities to initiate or expedite plans to decarbonize their economies. In short, natural gas will become more expensive and Washington has promised state governments will save money by moving quickly to ban natural gas. Ratepayers’ gas bills will increase.
• Tax incentives for consumers who get a new furnace or A/C unit are much more heavily weighted towards those who seek to fully electrify their homes. This means the legislation picks winners and losers. The consumers who get the full tax benefits of improving their homes’ efficiency are those who have the means to electrify their homes. Consumers that swap out their old HVAC system for a gas-fired system or electric resistance heat system, even if those systems meet efficiency requirements, will get a lesser credit assuming they qualify.
• A last-minute deal before this legislation passed the Senate extends the cap limiting business loss write offs for the next two years. Any tax benefit contractors may receive from performing qualified work on improving the energy efficiency of customers’ properties will likely be offset by the limit on loss write offs.

PHCC determined that the incentives to accelerate energy policies alone were sufficient to warrant opposition and believes it is impiortant to maintain access to natural gas as a kep part of a balanced energy portfolio for consumers. This legislation's prevention of contractors from minimizing business losses during a period of grave economic uncertainty makes the IRA even more unpalatable.

Thank you to those members who responded to PHCC’s call to action last week and remember you can have your voice heard again on Tuesday, November 8.