Capitol Connection Latest Legislative Updates from the Hill and Around the Country

he U.S. House of Representatives returned in January after their holiday break. In the rush to leave for the holidays, both the House and Senate passed a huge budget bill that was signed by the President in mid December 2015. This bill extends several business tax extenders of interest to ARA members and is discussed in more detail below. In addition, the President signed the Highway bill which includes the automaker parts data provision which is also discussed below. The new year brings opportunities to work with regulators on the implementation of this new law.

T

ARA Secures Critical OE Part Data for Automotive Recycling Industry

ongress passed a five-year highway reauthorization bill, entitled the Fixing America’s Surface Transportation (FAST) Act which includes a provision that requires automotive manufacturers to provide original equipment (OE) parts data for recalled components. ARA staff and leadership worked around the clock during the last few months of 2015 to secure the critical parts language in this bill which the President signed into law on December 4, 2015. This new law will now require automakers to make publicly available the OE part names, part descriptions and part numbers of a vehicle’s defective compo- nents that are subject to a recall. This is a significant step forward in ARA’s quest for motor vehicle parts data. For the first time, there is now federal statutory lan- guage requiring manufacturers to make OE part numbers available to the public. This language is a critical step as it provides a basis for ARA action in the coming months to work with regulators to secure electronic access to part numbers of recalled components tied to Vehicle Identification

C

This critical step provides a basis for ARA to work with regulators to continue efforts to gain access to parts data for all OEM parts.

Numbers (VINs) and to continue efforts to gain access to parts data for all OEM parts. ARA will continue to educate policymakers that it is only with electronic access to part numbers associated with specific VINs that professional automotive recyclers can comply with the TREAD Act of 15 years ago in which Congress pro- hibited the sale of non-remedied recalled automotive parts. ARA would like to thank our supporters in Congress – most notably Congressman Adam Kinzinger of Illinois and Senator John Thune of South Dakota – who helped champion our quest for this critical OE parts language. We also appreciate the efforts of ARA leadership, associate members and other stakeholders who contributed on our behalf.

The bill includes other recall-related provisions that call for a pilot grant pro- gram for States to notify consumers of vehicle recalls, establish incentives for dealers to check for open recalls at the time of service for all patrons and requires rental car companies to ground vehicles that are subject to an open safety recall until they are fixed.

ARA will now work with the National Highway Traffic and Safety Administration (NHTSA) to assist in the legislation’s implementation. Look here for future updates on ARA’s efforts to secure OEM parts data.

58 Automotive Recycling | January-February 2016

Final Budget Plan Incorporates Tax Extenders and Provisions for Businesses

f interest to many automotive recy- clers is the bill that the President signed into law last session providing for a budget package that will keep the fed- eral government running until the end of the fiscal year on September 30, 2016. H.R. 2029, The Protecting Americans from Tax Hikes Act of 2015, contains $680 billion in revised tax breaks over 10 years. A total of 52 tax extenders were made permanent and important busi- ness provisions include:

O

• The Research and Development Credit – Commencing in 2016, busi- nesses with less than $50 million in gross receipts can use the credit to offset the alternative minimum tax. • Expanded Section 179 deductions – Retains higher limits for deductions of the cost of qualifying asset acquisitions while also indexing for inflation in future years.

• The 100% exclusion of gains on cer- tain small business stock (Section 1202). • Reduction in S corporations’ gains recognition period for built-in gains tax. Many individual tax provisions were made permanent including the en- hanced child tax credit, the enhanced earned income credit and charitable giving incentives. Some provisions were not made permanent but were extended or modified for specified periods of time.

They include:

• Bonus depreciation – 50% for 2015 through 2017 and phased down to 40% in 2018 and 30% in 2019. Phased out completely after that.