Bennet, Cassidy Introduce New Tax Credit for Working Families, Small Businesses Preparing for Natural Disasters Bipartisan Proposal Mirrorsay25,2021Tax Credit in President Biden’s American Jobs Plan Washington, D.C. – Today, U.S. Senators Michael Bennet (D-Colo.) and Bill Cassidy, M.D. (R-La.) reintroduced the Shelter Act to help Americans protect their homes or businesses against natural disasters such as wildfires, hurricanes, tornados, floods, and drought. The Shelter Act would create a first-of-its -kind disaster mitigation tax credit for working families and small business owners in disaster-prone areas. President Joe Biden’s American Jobs Plan calls for a tax credit for disaster mitigation in line with the Shelter Act.  “In Colorado we know that a devastating natural disaster isn’t a matter of if, but when,” said Bennet. “While Americans can receive federal tax relief following a disaster to help recoup their losses, there isn’t an incentive to prepare for future threats. Our bill would change that by encouraging taxpayers to invest in measures that increase resilience and safeguard their homes and businesses, helping to defend properties and save lives.”  "The best way to recover from a flood is never flooding at all," said Dr. Cassidy. "Every family or business owner can reduce their property's chance of flooding. This legislation empowers them to do so." Despite hundreds of billions of taxpayer dollars spent on disaster recovery each year, there are currently no federal tax incentives to encourage families and businesses to plan ahead for disaster resilience and mitigation. The Shelter Act allows Americans to write off 25 percent of qualifying mitigation expenses, from strengthening the durability of a roof to elevating a housing unit to reduce potential flood damage. The tax credit has an annual limit of up to $5,000 per taxpayer. Eligible properties include homes or businesses in or adjacent to an area that the federal government has declared a disaster within the past 10 years. Taxpayers who rent a property in eligible areas can also receive the credit.  Earlier this month, Bennet visited Lyons, Colorado, where he discussed this proposal with small business owners and homeowners. He met with Connie and Neil Sullivan, owners of St. Vrain Market and Spirit Hound Distillery in Lyons, who are considering improvements to their businesses after Lyons was hit hard by floods in 2013. Bennet also stopped by the home of Ken Feldman and Gayle Gordon, who spent “between $2,000 to $2,500 to prepare their home for potential disaster.” The Shelter Act would help with these costs.  The Shelter Act is supported by the following organizations and businesses: American Institute of Architects, The Home Depot, National Association of Home Builders, National Association of REALTORS, and National Institute of Building Sciences. The bill text is available HERE. A summary is available HERE. A letter of support from the National Association of REALTORS is available HERE. Statements in Support of the Shelter Act:  “Last year, while fires burned in northern Colorado, many of our residents were evacuated, while others were in a pre-evacuation state for days on end. Neighbors just three miles south of us lost their homes. We were fortunate that our local and federal firefighting teams were largely able to prevent the loss of homes in Lyons. Residents were not so fortunate during the 2013 floods, which resulted in permanent property loss for housing for over 175 residents. The proximity, strength and speed with which the wildfires threatened our town forced many to face the wildfire risks that we knew existed, but for many of us, were disasters that only happened in other places. Many in the community are now asking how they can protect their families and property. It was great to visit with Senator Bennet in Lyons last month so he could see firsthand how his Shelter Act would support homeowners and business owners who want to safeguard against future wildfires or floods. It’s a relief to see a bipartisan effort to tackle preventative measures instead of only providing extremely costly disaster response funding,” said Joe Lampe, co-chair, Lyons Prepared. “We know that wildfire mitigation works, and that the return on investment for property owners is greater than just about anything else they can do for their home. Removing technical and financial barriers for meaningful mitigation action is a sound investment on our collective future. However, individual out-of-pocket expenses for home retrofits and defensible space work can quickly add up to several thousand dollars. A federal tax credit of up to $5000 for real cost associated with wildfire mitigation work will be a game changer for most homeowners in our Wildland Urban Interface. I support the Shelter Act, and believe it will be a valuable tool in building fire adapted communities,” said Eric Lovgren, Eagle County Wildfire Mitigation and Resilience Manager & REALFire Project Coordinator. “As a community that is threatened annually by wildfires, advancing legislation like the SHELTER Act to help homeowners and businesses become more resilient is imperative to the people of Glenwood Springs,” said Jonathan Godes, Mayor of Glenwood Springs. As a community that survived a major flood in 2013 and was threatened by the 2020 Calwood fire, the town of Lyons and surrounding area recognize firsthand the importance of disaster preparedness. Wildfire mitigation on private and public properties located in the wildland-urban interface is a critical step in preparing for and surviving future wildfires. We support Senator Bennet’s Shelter Act that would provide tax incentives to help home and business owners better prepare their properties for a natural disaster,” said Roy Leggett, chair, Lyons Wildfire Protection Task Force and Kristen Westhoff, previous chair, Lyons Prepared. “Pre-disaster mitigation planning is prudent government policy that saves taxpayer dollars. More importantly, it saves lives. The SHELTER Act provides critical government assistance to help vulnerable home and business owners make the upgrades needed to withstand the next natural disaster,” said Sarah Dodge, Senior Vice-President of Advocacy & Relationships at the American Institute of Architects. “NIBS has long studied mitigation, but the nation has invested far less in mitigation investments than seems to be warranted,” Lakisha A. Woods, CAE, President and CEO of the National Institute of Building Sciences said. “We believe the Shelter Act aligns with the research and data outlined in our Natural Hazard Mitigation Saves study, which shows pre-disaster mitigation activities save up to $13 for every $1 invested on a national average.”  “The National Association of REALTORS® thanks Senator Bennet and Senator Cassidy for their reintroduction of the SHELTER Act,” said NAR President Charlie Oppler. “A changing global climate continues to demand innovation from our nation’s real estate industry, and policies which encourage property owners to proactively address climate risks are today more critical than ever. NAR hopes to continue our work with Congress to lessen the financial burdens of increasingly prevalent and severe natural disasters.” The Shelter ActDisaster Mitigation Tax Credit The bipartisan Shelter Act provides a tax credit to working families and small businesses for investing in disaster mitigation. Hundreds of billions of taxpayer dollars are spent on recovery efforts after disasters, yet there are currently no federal tax incentives for investing in efforts to protect property ahead of time. With climate change accelerating the frequency and severity of natural disasters across the country, the Shelter Act will help Americans act now to safeguard their property, families, and livelihoods. Summary of the Legislation Despite hundreds of billions of taxpayer dollars spent on disaster recovery each year, there are currently no federal tax incentives to plan ahead for natural disasters and encourage mitigation. The Shelter Act allows Americans to write off 25 percent of qualifying mitigation expenses, from strengthening the durability of a roof to elevating a housing unit to reduce potential flood damage and clearing ignition-prone sources around properties to reduce wildfire risk. The tax credit has an annual limit of up to $5,000 per taxpayer. Eligible properties include homes or businesses in or adjacent to an area that the federal government has declared a disaster within the past 10 years. Taxpayers who rent a property in eligible areas can also receive the credit. The credit, establishing section 25E and 45U in the tax code, begins to phase down for households that earn more than $168,000 for joint filers and phases out entirely for households that earn more than $250,000. For businesses, the credit begins to phase down when a business earns $5 million and phases out completely when its revenue is more than $10 million. Examples of Qualifying Disaster Mitigation Expenditures: Improving the durability of a roof covering, impact-resistance (minimum class 3 or 4), or fire-resistance of a roof covering (minimum class A). Compensating for activities in FEMA’s Publication 804, Wind Retrofit Guide for Residential Buildings. Elevating the qualified dwelling unit above the base flood elevation or other applicable minimum elevation requirement. Purchasing and installing check valves to prevent flood water from backing up into drains. Purchasing and installing flood vents, breakaway walls or open lattice for homes located in V zones, designed and certified flood resistant buildings, and automatic shutoff valves for water and gas lines. Purchasing and installing exterior walls, doors, windows, or other exterior dwelling unit elements that conform to ignition-resistant construction standards. Performing fire maintenance procedures identified by the Federal Emergency Management Agency or the United States Forest Service, including fuel management techniques such as creating fuel and fire breaks. Acquiring weather data to better understand the local climate and drought history. Compensating for properties that received the Department of Homeland Security’s Resilience Star or a FORTIFIED home or FORTIFIED commercial designation from the Insurance Institute for Business and Home Safety. The hazard mitigation expenditure must in compliance with the latest published editions of relevant consensus-based codes, specifications, and standards or any more restrictive federal, state, or local floodplain management standards and consistent with floodplain management regulations. Taxpayers would be required to submit a summary of their hazard mitigation investment to the Internal Revenue Service.  Support for the Shelter Act American Institute of Architects, National Association of Home Builders, National Institute of Building Sciences, The National Association of REALTORS®, and The Home Depot.      Charlie Oppler 2021 President Bob Goldberg Chief Executive Officer   ADVOCACY GROUP Shannon McGahn Chief Advocacy Officer  May 25, 2021  The Honorable Michael BennetThe Honorable Bill Cassidy United States SenateUnited States Senate 261 Russell Senate Office Building520 Hart Senate Office Building Washington, D.C. 20510Washington, DC 20510 Dear Senators Bennet and Cassidy: On behalf of the more than 1.4 million members of the National Association of REALTORS®, thank you for introducing the SHELTER Act. This legislation is designed to provide tax incentives, in the form of targeted tax credits, to individuals and businesses that proactively invest in strengthening their homes and business buildings against damages caused by natural disasters, such as floods, wind, rain, or fire, before they happen. According to the National Oceanic and Atmospheric Administration (NOAA), a record 22 “billion-dollar plus” natural disasters cost the United States about $96 billion in 2020, with much of the damage being inflicted on homes and businesses. Moreover, since 1980, when NOAA started keeping records on the cost of such calamities, our nation has experienced 290 of these large weather or climate disasters with a total cost of more than $1.9 trillion in damages from them.  In one way or another, all Americans pay for the cost of damages from natural disasters, either through the cost of insurance, out of pocket costs, higher prices, loss of value, or through higher taxes or budget deficits to cover the amount governments contribute through various forms of assistance to victims of these catastrophes. By providing partial tax credits for proactive mitigation expenditures, your legislation encourages individuals, families, and businesses to strengthen their buildings before a disaster strikes, to make them less vulnerable to crippling damage or total destruction. Such actions can not only prevent tremendous anxiety, disruption, evacuation, injury and even death, they can potentially save billions of public and private dollars. When it comes to bolstering buildings against the potential onslaught of natural disasters, the old maxim that “an ounce of prevention is worth a pound of cure” certainly rings true.  Americans are an empathic and generous people, willing to share our resources and help our neighbors in times of need. But we are also a nation that values individual responsibility. Your legislation encourages action to prepare the buildings we live and work in to withstand damage before calamity strikes. At a time when disasters seem to be increasing in          REALTOR® is a registered collective membership mark which may be used only by real estate professionals who are members of the NATIONAL ASSOCIATION Of REALTORS® and subscribe to its strict Code of Ethics. intensity and frequency, this sends an important message that providence should be an essential element in our public policy.  Again, thank you for your leadership on this important issue. We look forward to working with you and your colleagues to help increase awareness that there are important steps that can and should be taken to lessen devastation from natural disasters before they strike. Sincerely,    Charlie Oppler 2021 President, National Association of REALTORS®                                                      Page 2

Senators Introduce Disaster Tax Relief Legislation

U.S. Senate

The SHELTER Act would encourage taxpayers to invest in disaster mitigation through a tax credit of up to $5,000 per year, according to a May 25 release from Senate Finance Committee members Michael F. Bennet, D-Colo., and Bill Cassidy, R-La.

<p>The SHELTER Act would encourage taxpayers to invest in disaster mitigation through a tax credit of up to $5,000 per year, according to a May 25 release from Senate Finance Committee members Michael F. Bennet, D-Colo., and Bill Cassidy, R-La.</p>

<p>The <a href="/lr/resolve//67z9c">SHELTER Act</a> would encourage taxpayers to invest in disaster mitigation through a tax credit of up to $5,000 per year, according to a May 25 release from Senate Finance Committee members Michael F. Bennet, D-Colo., and Bill Cassidy, R-La.</p>