The Biden Administration and Congress have won a historic achievement for IBEW members and their families with the Inflation Reduction Act.
|The Exelon-owned nuclear plant in Byron, Ill., which employs hundreds of IBEW members. Flickr/Creative Commons photo by Joseph Gage.
The measure, which passed in the Senate and the House earlier this month, was signed into law on Aug. 16. With this legislation, President Biden, who spoke at the International Convention in May, is following through on his promises to support organized labor and strengthen working families.
“This historic legislation delivers funding to support clean energy projects that will create new union jobs, lower energy costs and curb the climate crisis, and middle class Americans will see no increase in taxes,” International President Lonnie R. Stephenson said. “Most importantly, it ties prevailing wage and apprenticeship requirements to tax credits for clean energy generation like nuclear, solar and wind and puts into law stiff penalties for violators that choose the low road. We’ve really never seen anything like it when it comes to protecting union workers.”
Among the highlights of the bill is a tax credit to make it easier for Americans to purchase electric cars. Transportation is responsible for 27% of greenhouse gas emissions in the United States, according to the Environmental Protection Agency. IBEW members are already at work building approximately 500,000 new electric vehicle charging stations from President Biden’s Bipartisan Infrastructure Law enacted last year.
Other incentives in the bill will provide a boost to traditional forms of energy generation that employ thousands of IBEW members, including nuclear and carbon capture on coal and gas power plants, along with a new credit for developing solar and wind energy components.
For instance, nuclear power plants – currently the nation’s largest producer of carbon-free energy, and a leading employer of IBEW members – will be eligible for an estimated $30 billion in tax credits over the next 10 years, according to the Congressional Budget Office.
“The Inflation Reduction Act pairs the historic clean energy investments necessary to reduce carbon emissions by nearly 40% by 2030 with labor standards that promote family-sustaining jobs,” Stephenson said. “It also makes important strides in deficit reduction already underway, which will help bring down inflation.”
|A test wind farm off the Virginia coast is owned by Dominion Energy, a longtime employer of IBEW members. Carbon-free energy like wind received a boost in the Inflation Reduction Act. Photo provided by Dominion Energy.
In a huge win for working families, the bill provides much-needed reform to the U.S. tax system. Funding for the $369 billion bill will come from increased taxes on corporations and a new 1% excise tax on corporate stock buybacks.
Companies with profits of more than $1 billion in a year – many of whom now pay no federal taxes – will face a minimum 15 percent corporate tax rate. And the bill provides new resources to go after millionaire and billionaire tax cheats.
The additional revenue to lower the federal deficit is another tool to drive down inflation, which is already slowing after spiking earlier this year, all while the Biden administration oversees an economy that is booming in nearly every other measureable, including record job growth.
Stephenson noted the bill will have a positive effect on IBEW members in numerous ways while also strengthening America’s economic future for all its citizens.
“This landmark law boosts renewable energy production, carbon capture and nuclear energy, which are necessary provisions for increased domestic energy security,” he said. “Crucially, it incentivizes the purchase of electric vehicles for the charging network that IBEW members already are constructing. The members of the IBEW look forward to celebrating its passage and getting to work.”
AFL-CIO President Liz Shuler, a member of Portland, Ore., Local 125, said the legislation “will transform the lives of working families at every level.
“The bill will reshape the future and deliver real help to working families by reducing rising energy and health care costs,” Shuler added. “Enacting clean energy tax incentives with labor standards and domestic content requirements will create good-paying jobs in construction and manufacturing right here in America. And this legislation will address overdue changes to our tax system that will finally make the most profitable corporations pay their fair share.”
Importantly, the legislation calls for substantial penalties for employers who receive federal funding and fail to follow guidelines of the Davis Bacon Act, which ensures workers are paid based on local prevailing wages on public construction projects.
In addition, manufacturers will have to ensure an increasing percentage of their goods are made in America, reversing decades-long trends of these jobs being sent overseas.
The law is “an incredible step forward,” Shuler said.
“The effects of this legislation will improve the lives of millions of Americans struggling to afford healthcare, seniors trying to pay for their prescriptions and future generations who will be able to see the impacts of drastically reduced carbon emissions.”