The incoming chairman of the U.S. Senate Finance Committee says working to renew a slew of expired tax breaks, including the production tax credit (PTC), will be one of his first priorities when he takes office.
Sen. Ron Wyden, D-Ore., is slated to take over the chairman role for former Sen. Max Baucus, D-Mont., who was recently confirmed as the U.S. ambassador to China. On Feb. 11, Wyden told reporters, ‘My sense is that the focus at the outset is likely to be the extender package.’
The so-called extender package includes over 50 tax provisions that expired at the end of 2013, one of which was the PTC. Keith Martin, a partner at law firm Chadbourne & Parke, tells NAW that it's likely that the package will get passed but not until the last half of this year.
"Wyden is replacing the senior staff on the Senate Finance Committee. It will take time for them to settle in," he says.
In addition, Martin expects U.S. Senate Majority Leader Harry Reid, D-Nev., will avoid presenting the extender as stand-alone legislation.
"He usually needs something to propel such a bill forward, like doing it in the context of budget reconciliation where special rules limit debate or as a rider to some other must-pass legislation or because Congress is at the end of the session and eager to get home," Martin explains.
He also warns that outside opposition to a PTC extension for wind is better organized "than ever before," and the Republican-controlled House of Representatives will likely follow suit and stand against the tax incentive. Nonetheless, Martin believes the extenders will eventually pass after both houses of Congress negotiate.
Furthermore, he bets the construction-start deadline for the PTC will be extended for at least a year and suggests, "Companies should start planning how to incur at least five percent of the cost of more projects this year and be ready to pull the trigger when the extenders pass."