In Meeting with NLC, Speaker Ryan Talks Fate of These Key Municipal Issues

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The presumptive Republican nominee for president wasn’t the only one meeting with U.S. House Speaker Paul Ryan this week.

House Speaker Paul Ryan meets with NLC Director of Federal Advocacy Carolyn Coleman.
House Speaker Paul Ryan meets with NLC Director of Federal Advocacy Carolyn Coleman and local officials from Wisconsin on Monday, May 9, 2016.

This is a guest post by Carolyn Coleman.

On Monday, I had the opportunity to sit down with Speaker Ryan, along with a handful of Wisconsin local officials and leadership of the Wisconsin League of Municipalities, in Janesville, Wisconsin, to discuss National League of Cities legislative priorities for America’s cities and towns.

Joining me in the 20-minute session with the Speaker were: Racine Mayor John Dickert, Janesville City Manager Mark Freitag, Kenosha City Administrator Frank Pacetti, West Allis Mayor and League President Dan Devine, Manitowoc Mayor and Urban Alliance President Justin Nickels, Wisconsin League of Municipalities (League) Executive Director Jerry Deschane, League Assistant Executive Director Curt Witynski, and League Communications Director Gail Sumi.

We began the conversation talking about tax reform and the importance of preserving the tax-exempt municipal bond, the workhorse of infrastructure financing in cities and towns. The Speaker talked of his goals for tax reform – broadening the tax base and getting the rates down to help make sure that we don’t have more businesses moving their headquarters from America to foreign countries to lower their tax burden. He said a blueprint for tax reform will be released this summer and that the House will take up the issue in 2017.

Our focus on the tax exemption came as no surprise to the Speaker, and he acknowledged its legitimacy as a financing tool. He also shared that he’s very sensitive to the Puerto Rico debt crisis not jeopardizing the health of the U.S. bond market. While he wouldn’t commit to protecting the exemption in tax reform efforts, he did signal that the provision that allows tax payers to deduct state and local taxes is a bigger target for changes in a reform of the tax code since it costs the federal government more than the exemption and would bring in more revenue that could be used to finance a tax cut. According to estimates, the tax exemption costs the federal government approximately $540 billion over a 10 year period, while the deduction of state and local taxes costs the federal government approximately $1.1 trillion over a 10 year period. While saving the exemption is our top priority in efforts to reform the tax code, I let the Speaker know that preserving this deduction is a close second.

Moving on to e-fairness, the Speaker told us that everyone agreed there should be parity between online retailers and brick and mortar ones but everyone did not agree on how to do this with some preferring that the tax be based on the location of the seller (origin-sourcing) and some wanting the tax to be based on the location of the buyer (destination-sourcing). While not indicating whether he had a position on the approach, he did let us know that he’s asked the House Judiciary Chairman, whose committee has jurisdiction over the matter, to get an e-fairness bill through the Committee to the House floor for a vote and to conference with the Senate to reconcile differences in their respective bills. In response, I told the Speaker that cities and towns agree we need to get a bill moving in the House – after all, the lack of action is costing us over $23 billion a year – and are willing to work with the Chairman to get this done.

To wrap up the meeting, the local officials shared updates on their hometowns with the Speaker. Like that other meeting in Washington this week, I thought our meeting with Speaker Ryan was a good first step!

About the Author: Carolyn Coleman is the Director of Federal Advocacy at the National League of Cities. Follow her on Twitter @CColeman_Cities.