The Inflation Reduction Act of 2022, which passed the U.S. Senate on August 7, included key policy priorities for NGWA.
The $739 billion budget bill included changes to corporate tax structure, healthcare spending, and large investments to address climate change. NGWA saw two of its major policy priorities included in the bill with provisions extending the geothermal tax credits and $4 billion allocated for drought relief to the U.S. Bureau of Reclamation (USBR).
The extension of both the residential and commercial geothermal tax credits, which were set to expire in 2023, has been a longtime focus of NGWA’s legislative advocacy and was a central issue of its 2022 Smart Water Policies Virtual Fly-In. The Inflation Reduction Act includes various geothermal tax credit extensions through the year 2034. Some credits will also now be available to nontax-paying entities such as nonprofit organizations and tribes. A full list of the geothermal tax credits may be found here.
The bill also included an additional $4 billion allocated to the USBR for drought relief programs. The funding will be allocated to programs in reclamation states that aid in combating long-term drought impacts. A special focus will be given to states that are dependent on the Colorado River Basin.
Funding for drought relief programs, especially in USBR states, has been a growing issue of importance for NGWA and was also a focus of the 2022 Fly-In.
The bill will now go to the U.S. House of Representatives where it is expected to pass this week.
“I’m proud that our dedicated volunteers stood up and fought for these issues year after year,” NGWA CEO Terry S. Morse, CAE, CIC, says, “because geothermal tax credits and drought relief are not just important for our members and their businesses but also the future of our country.”
Click here to read the full list of geothermal tax credits.