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September 17, 2009
The Lobby Lookout: Lobbyists Push for Expansion of NOL Tax Provision
by Meg Shreve

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Lobbyists retained by industries as diverse as homebuilding and restaurants are sharing at least one agenda item this fall as Congress readies its next tax title — how to push for a broader carryback loss tax provision.

Much of the business community was disappointed when lawmakers in February scaled back the original carryback provision in the American Recovery and Reinvestment Act of 2009 (P.L. 111-5). But now a group of lobbyists has lined up behind House and Senate versions of a bill that would widen the net operating loss carryback period to five years for 2008 and 2009 losses.

The NOL issue cuts a wide swath through industries ready and able to tap their lobbying resources. According to, more than 50 entities have listed the Senate bill on their lobbying disclosure forms.

Take the homebuilders. A group called the Homes for America Alliance, which is focused exclusively on S. 823 and H.R. 2452, represents more than 70 homebuilding companies. Between April and July, the alliance registered six lobbyists and lobbying firms: the C2 Group, Hecht Spencer & Associates, Patton Boggs, Polsinelli Shughart, Van Heuvelen Strategies, and Kenneth Gear, who is listed as the group's executive director. The alliance so far has spent between $155,000 and $162,500 on lobbying. The Homes for America Alliance declined Tax Analysts' request for further details.

Also listing the House and Senate bills on their lobbying forms are the National Marine Manufacturers Association, the National Retail Federation, the National Restaurant Association, and the National Association of Manufacturers (NAM).

NAM has organized what it calls the NOL Coalition, a collection of several hundred different groups and businesses ranging from homebuilders to newspapers to manufacturers, according to Monica McGuire, chair of the coalition and senior policy director for taxation at NAM. "We're really just pounding the pavement on this," McGuire said, adding that coalition members taking their message to Capitol Hill visited six congressional offices during the August recess alone.

The number of lawmakers signed on to both the House and Senate bills, she said, is a sign of the measure's support. Currently, 102 House members are backing H.R. 2452, while 38 senators have signed on to S. 823. In July cosponsor Rep. Richard E. Neal, D-Mass., chair of the House Ways and Means Select Revenue Subcommittee, sent a letter to his fellow members asking them to support the House bill.

McGuire said the best vehicle for the provision could be a so-called tax "extenders" and estate tax bill that Congress could take up this fall. A House Democratic tax aide suggested that an expanded NOL provision could move as part of legislation dealing with the estate tax, the home buyers tax credit, or extenders.

But the lobbyists' strategy may meet resistance given new concerns about increasing the budget deficit. Key House and Senate staff members, speaking in a recent webcast sponsored by KPMG LLP's Tax Governance Institute, disagreed over prospects for an NOL expansion this year. John Buckley, Democratic House Ways and Means Committee chief tax counsel, argued that an NOL provision would likely move only as part of another stimulus package, a prospect that is not in Congress's announced plans.

Everyone expects taxwriters to be busy this fall drafting a healthcare reform bill. But an aide to Finance Committee Chair Max Baucus, D-Mont., cosponsor of S. 832, told Tax Analysts that Baucus remains "committed to working with colleagues as Congress assesses the continued need for the NOL provision and is exploring every opportunity for an appropriate vehicle to move his bill."

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