(Washington, D.C.) – Today, U.S. Senator Patty Murray delivered a speech on the Senate floor urging her colleagues to support sweeping legislation that would – among other provisions – extend the state and local sales tax deduction and provide tax relief for millions of Washington state residents.
The Jobs, Energy, Families, and Disaster Relief Act of 2008, which the Senate will vote on soon, also includes a provision that would extend the Secure Rural Schools Act to ensure that rural communities in Washington state and elsewhere can continue to pay for schools, build roads, and provide basic services.
The bill would also help replenish the Highway Trust Fund, and provide disaster relief.
In her speech, Senator Murray explained the importance of extending the sales tax deduction, which enables Washington state taxpayers to take an itemized deduction for state and local sales taxes in lieu of a deduction for state income taxes. A law allowing the sales tax deduction expired in December, and Republicans have so far blocked legislation that would extend it.
“It was a huge blow to the taxpayers in my home state when the sales tax deduction expired in December – and our Republican colleagues decided to block a bill that would have extended it for two more years,” Senator Murray said. “Today we have another chance. At a time that so many families are struggling just to get by – and at a time when we are looking for innovative ways to stimulate the economy – it is vital that we approve this measure, establish fairness in our state’s tax system, and put money back into the pockets of our state’s taxpayers.”
Additionally, Senator Murray addressed the need to extend the Secure Rural Schools Act and to support provisions that would shore up the Highway Trust Fund.
“Not only are these provisions critically important – they are time-sensitive,” Senator Murray said. “We need these programs in place, and we need them now.”
The following are Senator Murray’s remarks as prepared for delivery:
Mr. President, in the last year, Americans have faced an ever-increasing number of challenges from skyrocketing gas prices – to the mortgage and foreclosure crisis – record job-losses – and devastating natural disasters. Families are hurting, and they need relief right now.
I’ve come to the floor today because we will soon be voting on legislation that would help ease the burden for millions of families. Mr. President, it isn’t perfect, but the Jobs, Energy, Families, and Disaster Relief Act of 2008 would take important steps to create jobs, and provide disaster relief to flood, tornado, and hurricane victims.
This bill includes critical provisions to help our renewable energy industry to continue to thrive, and to shore up our Highway Trust Fund. And it includes provisions that are vital to my home state of Washington, including measures to extend the sales tax deduction and help rural schools.
So I want to take a few moments to urge my colleagues to support this legislation and get help into the hands of the taxpayers and communities that need it.
Sales Tax Deduction
And I want to begin by explaining how important it is that we extend the sales tax deduction. Mr. President, in most states, taxpayers can deduct state income taxes on their federal tax returns. But residents in my home state of Washington historically haven’t had that option.
In 2004, I worked with my colleagues from Washington state, Senator Cantwell and Congressman Baird, on a measure that – temporarily – enabled taxpayers to take an itemized deduction for state and local sales taxes. It enabled nearly 1 million people to save an average of $519 to $575 every year. And it has helped middle class families pay for school, cars, and other major expenses. The Washington state Office of Revenue Forecast has said that the sales tax deduction has created thousands of new jobs in our state.
But, Mr. President, it was a huge blow to the taxpayers in my home state when the sales tax deduction expired in December – and our Republican colleagues decided to block a bill that would have extended it for two more years. Today we have another chance. This proposal would extend the provision to the end of 2008.
At a time that so many families are struggling just to get by – and at a time when we are looking for innovative ways to stimulate the economy – it is vital that we approve this measure, establish fairness in our state’s tax system, and put money back into the pockets of our state’s taxpayers.
Secure Rural Schools
Mr. President, another provision in this bill is vital to help communities in my state to pay for roads, schools, and basic services. In Washington and other big Western states, where vast areas of land are owned by the federal government, states lose millions of dollars in tax revenues that normally would go to pay for schools and local government services.
In the past, the federal government shared the revenue from timber sales on federal land to help states make up for that lost revenue. But because timber sales have been decreasing since the mid-1990s, Congress passed the Secure Rural Schools Act to ensure that those rural communities continue to get the money they need to pay for schools, build roads, and provide basic services. That act expired two years ago. And while we funded it for a year on the Fiscal Year 2007 Supplemental, it hasn’t been extended this year – meaning that rural communities in my home state and across the West are struggling to keep their school doors open.
Mr. President, some communities have already sent out pink slips. This bill would again extend the program to 2011 and adjust the funding formula to make it more equitable, and increase Payments in Lieu of Taxes to rural counties across the country. This provision is extremely important to our rural communities. All of our children deserve equal opportunities to learn, regardless of where they live, and this funding would help ensure that is possible.
Highway Trust Fund
Next, Mr. President, I want to say a few words about the Highway Trust Fund fix, which is also part of this bill. Mr. President, the condition of the Trust Fund, which helps pay for highway repair and construction – as well as mass transit – has been deteriorating for years. But skyrocketing gas prices have made an already dire situation worse. This year, we will see the largest recorded decrease in highway miles traveled in the last 17 years. As a result, the Trust Fund is now less than a year away from going bankrupt, leaving critical construction projects in peril.
I – along with Senator Bond, the Ranking Member of my Transportation and Housing Appropriations Subcommittee – have been sounding the alarm about the problems facing the Highway Trust Fund for close to two years now. In January of 2007, we wrote to voice our concern to Senators Baucus and Grassley of the Finance Committee – and they promised to help fix the problem.
The Senate has now tried twice this year to move a bill through the Senate to fix the Highway Trust Fund for 2009, and there is a broad bipartisan consensus about the need for a solution. Unfortunately, our efforts have been blocked repeatedly by just a couple of Senators.
Mr. President, this bill would provide enough money – $8 billion – to get through the coming fiscal year. It would help us keep as many as 380,000 good-paying jobs, and to continue critical construction and repair projects that will make our highways and bridges safer. Mr. President, this proposal won’t have any revenue effect. It passed the House on July 23 by an overwhelming majority. And it’s vitally important to all of our communities that the Senate do the same.
We Need This Bill
Mr. President, this bill includes numerous other provisions that would help ease the burden of the faltering economy for our taxpayers. For example, it would extend tax credits for wind, biomass, geothermal, and other renewable energy providers and help provide stability for this developing industry. As I said at the beginning, this bill isn’t perfect. Unfortunately, we’ve had to leave out some worthy items.
But this bill is still extremely important. And we are very close to making this legislation a reality. We just need a few more Senators to join us. Unfortunately, there are still some Republicans in this body who would rather play politics with this bill than create jobs, support clean energy, and provide tax relief for families across this country.
Well, Mr. President, this is too important to leave to politics. Not only are these provisions critically important – but they are time-sensitive. At a time when the economy is lagging – when families are struggling – we need these programs in place, and we need them now. And I hope that Republicans will join us, put politics aside, and make American families a priority.
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