Letter to the Senate Urging a Yes Vote on Tax Extenders
June 24, 2010
On behalf of the National Education Association's (NEA) 3.2 million members, we urge you to VOTE YES on the revised version of the American Jobs, Closing Tax Loopholes and Preventing Outsourcing Act (H.R. 4213), scheduled for a floor vote this week. Votes associated with these issues may be included in the NEA Legislative Report Card for the 111th Congress.
- Provides critical pension funding relief essential to help businesses stave off layoffs
- Provides essential Medicaid funding relief for states to help ameliorate urgent budget crises that continues to weaken the economy
- Extends unemployment benefits to help struggling families; and
- Extends the deduction for educators’ out-of-pocket classroom supply expenses.
Pension funding relief is essential to help single-employer and multi-employer defined benefit plans deal with losses incurred as a result of the cataclysmic financial market collapse of late 2008 and early 2009. This relief will help business by sparing them from impossible financial positions. As a result, it will free up resources and help prevent layoffs that drive up unemployment rates. In particular, we strongly support provisions that would allow single-employer plans to amortize recent losses over 15 years, and multi-employer plans to amortize them over 30 years. No matter how conscientiously a sponsor might have previously funded its plan, it could not have been prepared to withstand a 40 percent decline in the market value of the plan’s assets within a nine-month period.
An extension of the enhanced federal matching funds for state Medicaid programs (FMAP) is critical for job creation and economic growth and to stave off deeper cuts to education and other priorities. The new state fiscal year begins on July 1, but current FMAP funding ends in December, the middle of their fiscal year. State budget gaps total $140 billion over the next fiscal year and could cost the economy 900,000 jobs in the near term and more than three million by 2012. Thirty states have reported that their budgets (proposed or already adopted) assume the six-month FMAP extension.
The educator tax deduction recognizes the financial sacrifices made by teachers and paraprofessionals, who often reach into their own pockets to purchase classroom supplies. In 2005-06, educators’ out-of-pocket expenses averaged nearly $2,000. The deduction expired at the end of 2009; H.R. 4213 would extend it for an additional two years.
Finally, extending unemployment benefits through the end of 2010 will help ensure important life-lines for over 6 million workers and their families, and will provide much needed economic stimulus to communities throughout the country.
Again, we urge you to VOTE YES on H.R 4213.
Director of Government Relations