WRDA Bill Passes Senate; Tax Bill Fails

OMAHA (DTN) -- The U.S. Senate on Thursday rejected a tax-cut bill that would have provided farmers with larger deductions on purchases of equipment and buildings this year.

The Senate voted 48-44 on the Tax Relief for American Families and Workers Act. The bill needed 60 votes to advance. Three Republican senators voted for the bill while two independent senators voted with Republicans to oppose it.

The House voted overwhelmingly at the end of January to pass the $79 billion tax package, which includes a mix of business tax credits along with an expansion of the child tax credit.

The bill would have re-established 100% bonus depreciation for certain property, including 20-year buildings. Currently, bonus depreciation for the 2024 tax year is set at 60% of the property value. The bill also would have boosted Section 179 deduction levels.

The meat of the tax bill, however, was an increase in the maximum refundable child tax credit. Senate Majority Leader Chuck Schumer, D-N.Y., put the bill on the floor knowing it was unlikely to get Republican support this close to the presidential election.

Republican senators also indicated they believe they can get a better tax package if they win the Senate. Next year will be a key year in trying to pass a tax package because several key tax breaks start to end after 2025.

WRDA BILL CLEARS

While defeating the tax bill, senators also unanimously passed a Water Resources Development Act (WRDA) bill that will allow both chambers to negotiate on a final piece of legislation. The WRDA bill details U.S. Army Corps of Engineers projects such as lock and dam improvements.

Congress has been consistent in recent years in passing a new WRDA bill every two years.

The Senate WRDA bill passed following the House passing its version of the bill on July 22. The Senate version would authorize 13 new or modified construction projects as well as pushing the Corps of Engineers to expedite current projects. The bill also authorizes 83 different feasibility studies on other potential water infrastructure projects.

The House bill calls for 160 feasibility studies for projects and set up 12 new or modified construction projects.

The National Grain and Feed Association (NGFA) commended the Senate for passing the bill. NGFA cited that the bill would permanently increase the federal cost-share for inland waterway projects to 75% with the remaining 25% coming from the Inland Waterways Trust Fund, shifting from an old 65/35 split. The bill also provides funding for projects authorized through the Infrastructure Investment and Jobs Act.

"The U.S. inland waterways system is crucial to the operations of NGFA-member companies and the agricultural supply chain, with barges transporting about half of all grains to export grain elevators. Efficient inland locks and dams and modern ports are vital to maintaining America's comparative infrastructure advantage," NGFA stated.

LACK OF SENATE FARM BILL

With the Senate wrapping up business before its August recess, Senate Minority Leader Mitch McConnell, R-Ky., criticized Schumer for bringing a series of political bills to the floor such as the tax bill. McConnell also criticized Senate Agriculture Committee Chairwoman Debbie Stabenow, D-Mich., for "failing to get anywhere on the farm bill."

McConnell said, "The farm bill that's supposed to help America's growers and producers succeed doesn't even exist yet. Apparently, it's just a twinkle in Chair Stabenow's eye."

The House Agriculture Committee advanced a farm bill out of committee in May, but House members left last week for break without bringing the bill to the floor for a vote.

Chris Clayton can be reached at Chris.Clayton@dtn.com

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