Finance, Pensions & Intergovernmental Affairs Steering Committee

Policy Briefs

Unfunded Mandates and Other Regulatory Impacts on Counties

Unfunded Mandates and Other Regulatory Impacts on Counties 

PDF icon Unfunded Mandates (June 2019).pdf

Support H.R. 2772 to Restore Tax-Exempt Status of Advance Refunding Bonds

ACTION NEEDED:

Urge your Members of Congress to support passage of H.R. 2772 to restore advance refunding bonds.

BACKGROUND:

Tax-exempt bonds are a well-established financing tool written into the first tax code in 1913. They are predominantly issued by state and local governments for governmental infrastructure and capital needs purposes, such as the construction or improvement of schools, streets, highways, hospitals, bridges, water and sewer systems, ports, airports and other public works.

Prior to 2017, advance refunding bonds were also tax-exempt and allowed counties to refinance municipal bonds once over the lifetime of the bond. Advance refunding bonds, when tax-exempt, allow state and local governments to lower borrowing costs and take advantage of more favorable interest rates. This frees up resources to be used for other important capital projects and minimizes costs to taxpayers. Advance refunding bonds also allow localities to address problematic bond terms and conditions or to restructure debt service payments for budget flexibility.

On December 23, 2017, President Trump signed the Tax Cuts and Jobs Act (P.L. 115-97), the first major rewrite of the tax code since 1986. While the final bill retained tax-exempt status for municipal bonds, it eliminated the tax-exempt status of advance refunding bonds.

PDF icon 2019 AR Bonds Policy Brief.pdf

Support Repeal of the 40 Percent Excise Tax on Employer-Sponsored Health Insurance

ACTION NEEDED:

Contact your members of Congress and urge them to support legislation to permanently repeal the 40 percent excise tax on employer-sponsored health insurance that was included in the Patient Protection and Affordable Care Act (ACA) passed in 2010. 

BACKGROUND:

When the ACA was enacted into law in March 2010, one of the provisions included in the law was an excise tax on employer-sponsored health coverage. The tax is levied on the aggregate amount of employer-sponsored coverage exceeding thresholds established in the law ($10,800 for individual coverage and $29,100 for family coverage). After Congress repeatedly delayed this provision, the excise tax is currently set to take effect in 2022.

NACo policy opposes the taxation of health benefits provided to county employees. There are 3.6 million county employees that serve over 308 million county residents and healthcare coverage is one of the primary benefits counties use to attract and maintain a quality workforce. If the excise tax on employer-sponsored health insurance is implemented, counties will face a significant impact on their budgets and workforce.

PDF icon 2019 Excise Tax Fact Sheet DRAFT.pdf

Support Local Economies by Allowing the Collection of Existing Sales Taxes on Remote Sales

ACTION NEEDED

Counties should work with Congress to support legislation that would allow counties to enforce their existing sales tax laws regardless of whether a purchase is made in a store, online or through a catalog retailer.

BACKGROUND

On June 21, 2018, the U.S. Supreme Court ruled in South Dakota v. Wayfair that states and local governments can require vendors with no physical presence in a state to collect and remit existing sales taxes on remote or online purchases. This case asked the court to review its 1992 decision in Quill v. North Dakota, which upheld the “physical presence” standard established in 1967.  

This ruling enables each state to decide whether to enforce sales tax collection on remote purchases. Under this framework, a state may pass legislation requiring remote sellers to collect these taxes, even if a vendor has no physical presence in the state. If state laws are challenged in court, each state supreme court would then determine whether the law is enforceable and consistent with federal law. For counties, lost revenue from online and remote sales means less money for basic services, such as roads and law enforcement officers.

PDF icon Online Sales Tax 2018_update.pdf

Protect County Revenues by Opposing Preferential Tax Treatment for Particular Industries

ACTION NEEDED:

Contact your House and Senate members and urge them to oppose legislation that would grant certain industries (e.g. wireless, rental car, and online travel) preferential tax treatment and threaten the fiscal health of local governments.

BACKGROUND:

In recent years, a growing number of industries have actively urged Congress to preempt state and local government taxing authority over their particular business model. While local taxing authority and practices differ by state, local governments tailor their tax policy by accounting for the sources of revenue available and the needs and desires of their residents. Representatives from the wireless, rental car and online travel industries are asking Congress to restrict the ability of state and local governments to decide their own tax classifications for businesses. If preferential tax laws are enacted according to industry wishes, state and local governments would be forced to impose the same tax rate for every industry and every service. This could reduce revenues for local services and undermine the existence of independent state and local taxation authority in our system of federalism. 

PDF icon Preferential Tax 2017.pdf

Latest Resources

Join a steering committee and make a difference. Learn more about getting involved in NACo's Finance, Pensions & Intergovernmental Affairs Steering Committee:

Finance, Pensions and Intergovernmental Affairs Steering Committee

Chair

Kevin Boyce
Commissioner
Franklin County, Ohio

 

Vice Chair

Cindy Bulloch
County Assessor
Iron County, Utah

 

Nathan Magsig
Supervisor
Fresno County, California

 

Laura Montoya
Treasurer
Sandoval County, New Mexico

 

Grant Veeder
Auditor/Commissioner of Elections
Black Hawk County, Iowa

 

Subcommittee Chair

Diane Dillon (County and Tribal Relations)
Supervisor
Napa County, California

 

Ricky Hatch (Elections)
Clerk/Auditor
Weber County, Utah

 

John Wilson (Fiscal Policy and Pensions)
County Assessor
King County, Washington

 

Subcommittee Vice Chair

Mike Brown (Fiscal Policy and Pensions)
Commissioner
Johnson County, Kansas

 

Jason Carini (Fiscal Policy and Pensions)
Treasurer
Rogers County, Oklahoma

 

Sidney Fitzpatrick (County and Tribal Relations)
Commissioner
Big Horn County, Montana

 

Mike Fricilone (Fiscal Policy and Pensions)
Board Member
Will County, Illinois

 

Kurt Gibbs (Fiscal Policy and Pensions)
Board Chair
Marathon County, Wisconsin

 

Tasha Kama
Councilmember
Maui County

 

Brian Kruse (Elections)
Election Commissioner
Douglas County, Nebraska

 

Alysoun McLaughlin (Elections)
Deputy Election Director
Montgomery County, Maryland

 

Dolores Ortega-Carter (Fiscal Policy and Pensions)
Treasurer
Travis County, Texas

 

Tonia Tunnell (Elections)
Director, Learning & Development
Maricopa County, Arizona

 

Contact

  • Associate Legislative Director – Finance, Pensions and Intergovernmental Affairs  
    (202) 942-4204