Below are a few highlights of the federal policy initiatives IEC continues to monitor and work with Indiana’s Congressional delegation to resolve:
Pension fix
NRECA’s pension program was modified by 2014 federal legislation to more accurately represent the program and its participation. Unfortunately, federally-mandated pension insurance premium rates were not modified by the 2014 legislation; as a result, participating cooperatives are required to pay nearly four times more in premiums than the correct premium rate.
In May, the House passed H.R. 1994 (the SECURE Act), which includes language addressing the ongoing pension premium issue for NRECA’s Retirement Security Plan pension program. All nine Indiana representatives voted to pass the bill. The bill now awaits a hearing in the Senate, and IEC continues to work with Sens. Young and Braun to emphasize the importance of getting the SECURE Act passed.
Tax-exempt status
To maintain its 501(c)(12) tax-exempt status, an electric cooperative cannot receive more than 15 percent of its income from non-member sources (such as interest on bank accounts). In 2017, the Tax Cuts and Jobs Act removed language in the tax code excluding government funds (such as disaster relief and grant programs) from the definition of “non-member income,” forcing electric cooperatives across the country to choose between using government funds for disaster recovery efforts or to assist in broadband deployment or maintaining its tax-exempt status.
Seven of Indiana’s representatives have joined H.R. 2147 (the RURAL Act) as co-sponsors to allow electric cooperatives to access government funds without jeopardizing their tax-exempt status: Reps. Jackie Walorski (IN-02), Jim Banks (IN-03), Jim Baird (IN-04), Susan Brooks (IN-05), Greg Pence (IN-06), Larry Bucshon (IN-08) and Trey Hollingsworth (IN-09). IEC continues to work with the rest of Indiana’s Congressional delegation to understand the bill and its impact on Indiana’s electric cooperatives.
Broadband policy
Reps. Greg Pence (IN-06) and Pete Visclosky (IN-01) have introduced H.R. 4283 (the Broadband Interagency Coordination Act), which creates requirements governing interagency communication and information sharing between the Federal Communications Commission (FCC), U.S. Department of Agriculture (USDA) and the National Telecommunications and Information Administration (NTIA) regarding broadband deployment grant programs.
IEC also continues to monitor S. 1822 (the DATA Act), which requires the FCC to develop new, more granular data collection methods to accurately depict broadband access throughout the country. IEC continues to work with the Indiana Congressional delegation to understand the importance of improved broadband data and methodology and its benefits for electric cooperatives undertaking broadband deployment projects.
The USDA awarded its first grant in the first funding round of the ReConnect Program to Tennessee-based Forked Deer Electric Cooperative, Inc. The ReConnect Program seeks to award $600 million through grants, low-interest loans and grant/loan combination awards to assist rural broadband deployment initiatives. A second funding round of $550 million is expected in late 2019. IEC continues to monitor the program and study successful applications ahead of the second funding round.