The Window and Door Manufacturers Association (WDMA) reported today that the compromise tax legislation extending the Bush tax cuts will include a 25c tax credit that will include a 10 percent credit up to $200 for Energy Star windows and skylights and a 10-percent credit up to $500 for Energy Star exterior doors. It would be a one-year credit starting Jan 1, 2011 continuing to Dec 31, 2011.
The WDMA had been advocating for inclusion of a one-year extension of the current 25c tax credit for windows, doors and skylights (30 percent/$1,500) tied to Energy Star standards, which was included in Sen. Max Baucus’ (D-MT) tax cut bill that was voted down last weekend.
“While we and others made convincing jobs arguments for an extension of the 25c tax credits (which include other building products), some Congressional negotiators were opposed to extending any ‘stimulus’ tax credits enacted as part of the 2009 American Recovery and Reinvestment Act (ARRA),” says the WDMA. “Several ARRA tax credits were stripped and others in existence prior to ARRA, like 25c, were scaled back to pre-stimulus levels.”
The WDMA adds that it is exploring options for modifying this language prior to final adoption.
Window manufacturers, including Gorell Windows and Doors and Northeast Building Products, continues to urge Congress to extend the current tax credits and urges others in the industry to do the same.
“As a company we are extremely disappointed that the $1,500 window and door tax credit hasn’t yet been extended,” says Jeff Witkin, executive vice president, Northeast Building Products Corp. in Philadelphia. “Since its inception in 2009, the tax credit has increase awareness for the homeowner to seek out energy-efficient windows and doors, which will help them save money on heating and cooling costs. It has also increased sales for manufacturers, which lead to job growth for our industry.”
“Obviously, I’m disappointed with this reduced credit as I doubt that it will have much if any impact on future sales,” says Wayne Gorell, chief executive officer. “I still think the industry and trade journals need to keep pressing their representatives to get the 25c language reinstated. I believe there is a good reason for the credit, from direct manufacturing jobs from manufacturers and suppliers, to the small business dealers and their tens of thousands of employees along with the energy conservation benefit of the legislation reducing energy use in our country. It’s a win/win proposal for all, seems hard to understand that with all the government spending on crazy projects, this is one that should make sense to all sides.”
He adds that the legislation is not set yet so time is of the essence to get the message out.
“We don’t have lobbyists but we have lots of tax paying citizens who together should have a loud voice,” adds Gorell.
The American Architectural Manufacturers Association (AAMA) has also worked to urge Congress to extend the current $1,500 tax credit.
“In many instances, the Senate is forced to take action on issues with little information and hope for the best result,” says AAMA president Richard Walker. “The fenestration tax credit is not one of these issues. Congress fully understands that the introduction of the 2008 ARRA tax credit allowed manufacturers to restart production that had all but disappeared during the early stages of the housing crisis. Homeowners were provided with an opportunity to purchase energy-saving windows while previously laid-off production line workers were able to resume their jobs and installers were back at the job.”
Walker adds that Congress need only look two years back to confirm that a severely reduced credit in the $200 range does not incentivize homeowners to make these energy-efficiency purchases, and once again, lay-offs will be felt across the manufacturing, supply and installation chain.
“Fortunately, AAMA has worked closely with both Senator Olympia Snowe (R-ME) and Senator Jeff Bingaman (D-NM), who remain vigilant in obtaining compromise legislation that will keep the full breadth of potentially affected workers off the rolls of the unemployed,” says Walker.