Washington Report (January 2025)

Trade

The situation regarding imposition of tariffs on our trading partners remains fluid. Shortly after President Trump was sworn into office on Monday, his Administration announced that it would “study” potential tariffs on China, Canada and Mexico. Later that evening in an interview, the President indicated that he would seek 25 percent tariffs on Canada and Mexico beginning February 1. In preparation, Canadian government officials have been meeting with House and Senate leaders announcing the Canadian government’s intention to impose retaliatory tariffs aimed at products made in states that form the base of President Trump’s support should tariffs on Canadian imports be imposed.

Meanwhile, U.S. companies whose supply chains rely on parts from both countries are also sounding the alarm with elected officials here in D.C. WIA is on hand and following developments closely.

Federal Forest Management/Wildfires

Congressman Bruce Westerman (R-AR) and Representative Scott Peters (D-CA) reintroduced the Fix Our Forests Act late last week. The swift reintroduction in the 119th Congress underscores the urgent need to enhance forest management projects to mitigate wildfire risks. The full House is scheduled to take up the legislation Wednesday, in part as a response to the California wildfires. We expect a Senate version of the bill to be introduced in the coming weeks. The House passed the Fix Our Forests Act in September 2024 with bipartisan support.

Among other things, the bill would:   

• Simplify and expedite environmental reviews for forest management projects.
• Make communities more resilient to wildfires by better coordinating existing grant programs and promoting new research.
• Promote federal, state, tribal and local collaboration.
• Deter frivolous litigation that delays essential projects.
• Create a framework for prioritizing treatments in the forests at the highest risk of wildfire and near vulnerable communities.
• Encourage the adoption of state-of-the-art science and techniques for federal land managers.
• Encourage active management to improve the safety of powerlines and other infrastructure.
• Strengthen existing policy tools like Good Neighbor Authority and Stewardship Contracting.
• Support wildland firefighters and their families by ensuring continuity in casualty assistance programs.

"As tragic wildfires rage in Los Angeles, we're working in Washington to help prevent these types of catastrophes in the future with the Fix Our Forests Act. It's time to take an all-hands-on-deck approach and use proven science to restore our forests to a healthy state and protect communities in the wildland-urban interface from wildfires. This legislation will leave our nation's forests more resilient and ensure they can be responsibly enjoyed and managed for generations to come." - House Committee on Natural Resources Chairman Bruce Westerman (R-AR-04), who is himself a forester.

Tax

Republican leaders announced last week that a budget resolution would be ready for consideration in early February. This is important as passage of a budget resolution kicks off the budget reconciliation parliamentary process that GOP leadership intends to use to extend or make permanent the business tax benefits enacted by the Tax Cuts and Jobs Act of 2017. Included in the resolution will be “instructions” to the relevant Congressional policy committees to assemble legislation to change spending, revenues, deficits or the debt limit by specific amounts. Each committee  then compiles legislation to achieve its target, and if more than one committee is told to act, the Budget Committee bundles each measure into one large bill.

The current timeline has the House acting on the resolution in early February with the Senate following suit mid-month. Speaker Johnson’s goal is to have budget reconciliation legislation ready in April with final passage complete by Memorial Day. This timeline may be optimistic, however. Recall that the TCJA was enacted at the very end of President Trump’s second year in office, so these efforts are complicated and take time to mature. The other issue under discussion is whether there will be two reconciliation packages or just one. Senate leadership has been advocating for a first reconciliation bill to address border security, energy production and military readiness, with a second follow-on package dealing solely with tax. The situation is fluid.

Items to be included in a tax reconciliation bill are extension of the 100 percent bonus depreciation tax benefit, extension of the research and development tax credit and renewing the 20 percent deduction for S-Corporations and pass through entities.  Regarding the latter, WIA signed onto a letter last week in support of legislation that is going to be introduced by Senator Steve Daines (R-MT) and Representative Lloyd Smucker (R-PA) known as the Main Street Tax Certainty Act of 2025. This bill would make permanent the Section 199A deduction for pass throughs. You can read the letter here.

The WIA team will be actively engaged in the process moving forward over the next several weeks and will keep you regularly informed of developments.

Corporate Transparency Act (CTA)

On January 15, Representative Warren Davidson (R-OH) and Senator Tommy Tuberville (R-AL) reintroduced their bicameral CTA repeal bill, dubbed the Repealing Big Brother Overreach Act. The legislation is only 3 pages and was introduced with 68 cosponsors in the House.

As we have noted, the CTA reporting obligations took effect last year, but a nationwide court injunction was put in place late last year and implementation of the law is on hold until the Supreme Court rules on the matter. A one-year delay in the compliance deadline was part of the initial Continuing Resolution to fund the government in December but fell out of the final package that was signed into law. We will keep you apprised of the action on this important issue.