Lawmakers loosen gridlock for co-op legislation


Sometimes it may appear there is only gridlock and divisiveness in Washington, D.C., and there is indeed an abundance of that. However, there are also many things being accomplished that the average American never hears about ­­— things that may not make headlines or be “exciting” enough to make the nightly news or social media.

Such is the case with legislation regarding important issues for electric cooperatives, not only in Arkansas, but across the nation, that passed Congress just before the new year began. For months, and even years in some cases, electric co-ops have been advocating for passage of several pieces of legislation, including the RURAL Act. This legislation was co-sponsored by all members of Arkansas’ congressional delegation — Sen. John Boozman, Sen. Tom Cotton, Rep. Rick Crawford, Rep. French Hill, Rep. Steve Womack and Rep. Bruce Westerman. It is designed to correct an unintended consequence in the Tax Cuts and Jobs Act of 2017.

To maintain the electric cooperatives’ tax-exempt status, co-ops can receive no more than 15% of their income from non-member sources. Historically, government grants to cooperatives were counted as contributions to capital. But because of a glitch in the 2017 tax law, government grants were reclassified as income, pushing some cooperatives beyond the 15% threshold and jeopardizing their tax-exempt status. This left electric co-ops with difficult decisions. Do they take money to restore power and recover from a disaster? Do they accept broadband grants? Or do they turn down these grants so they would not have to spend their members’ money paying taxes instead of improving service? The RURAL Act had more than 300 co-sponsors in the House and more than 50 in the Senate.
That is a rarity in Washington today.

Another important accomplishment was passage of SECURE Act. This legislation, again supported by our delegation, sought to adjust insurance premiums paid to the Pension Benefit Guaranty Corporation, saving electric co-ops across the nation approximately $40 million. We were paying higher premiums normally associated with large, high-risk corporations. The SECURE Act adjusts this and recognizes our stability.

Also, the so-called “Cadillac Tax” on employer health plans was fully repealed. Enacted in 2010 as part of the Patient Protection and Affordable Care Act, this was a 40% excise tax on certain health care plans. This repeal will save our members money and protect health care benefits.

Additionally, Congress approved $555 million for the USDA ReConnect program to finance the deployment of broadband.

All of these measures help the electric cooperatives continue to serve our members by providing safe, affordable and reliable power, as well as improve the quality of life for rural Arkansans.

So, when someone implies Congress is not getting anything done for the people, I hope you challenge that and let them know they did plenty, in a bi-partisan fashion, for rural America and rural Arkansas. And for that, we say thank you!

Kirkley Thomas is vice president of governmental affairs for Arkansas Electric Cooperatives, Inc.