Source: United States Senator Marsha Blackburn (R-Tenn)
NASHVILLE, TENN. – Given the important role tourism and entertainment play in Tennessee, U.S. Senator Marsha Blackburn (R-Tenn.) introduced bipartisan legislation to ensure the transportation industry is not faced with exorbitant tax fees on grants they received during the pandemic.
Senator Blackburn was joined by Senators Jack Reed (D-R.I.), Susan Collins (R-Maine), Bob Casey (D-Penn.), Steve Daines (R-Mont.) and Jeanne Shaheen (D-N.H.) in pushing this bill to exempt grants received under the Coronavirus Relief for Transportation Services (CERTS) Act from federal taxation.
“When the pandemic hit, Tennessee’s top industries became all too familiar with closures and financial hardship, and the transportation industry was no exception,” said Senator Blackburn. “While they received vital support to sustain their businesses, bus, motorcoach, and other passenger vessel companies are now faced with exorbitant tax bills through no fault of their own. My bill ensures the transportation industry – which plays a critical role in the Volunteer State’s economy, from tourism to entertainment – is treated fairly and granted the same tax exemptions that restaurants and performance halls received.”
“The COVID relief Congress provided to help bus, motorcoach, school bus, and passenger vessel companies was a critical lifeline,” said Senator Reed. “But the road to economic recovery for these businesses has been long and steep. Now, Congress should step up on a bipartisan basis to support these critical transportation providers by putting them on the same tax footing as other industries that received COVID relief. This bill would help accelerate economic recovery for this key link in our transportation system.”
“In 2020, I introduced the CERTS Act with Senator Jack Reed, and secured $2 billion to support transportation providers that desperately needed it. Extending to bus, motor coach, ferry, and tour boat companies the same tax relief provided by other emergency federal assistance programs, will allow these companies to recover from the pandemic, while continuing to provide good-paying jobs and vital transportation services throughout Maine,” said Senator Collins.
“Montana’s transportation sector was hit hard during the COVID-19 pandemic and while many businesses received much-needed emergency funding to get back on their feet, they’re now facing hefty tax bills. Just as relief programs for restaurants and performance centers were exempt from taxation, Montana’s transportation businesses should be as well,” said Senator Daines.
“During the COVID-19 pandemic, funds allocated through the Coronavirus Economic Relief for Transportation Services (CERTS) Act were a lifeline for motorcoach, bus and passenger vessel companies across the nation. These companies are critical to supporting our public transportation industry and should not be faced with steep tax bills as a result of their participation in this relief program,” said Senator Shaheen. “That’s why I’m glad to support this bipartisan legislation to ensure these companies are exempt from taxation on COVID-19 assistance grants and CERTS program funds remain exempt from taxation, similar to other pandemic-era relief programs.”
The bill is supported by United Motorcoach Association, American Bus Association, National School Transportation Association, and Passenger Vessel Association.
“The United Motorcoach Association thanks Senators Jack Reed and Marsha Blackburn, along with Senators Susan Collins, Bob Casey, Steve Daines and Jean Shaheen for their support in introducing the CERTS Tax Exemption Act for the first time in the United States Senate. The motorcoach industry lost nearly one-half of its companies due to the pandemic. For the survivors that remain, the bill would correct an unfair disparity in tax treatment of CERTS funds as compared to all other COVID relief funds Congress provided. UMA strongly appreciates the bipartisan support on this issue as the industry continues to recover and rebuild, ” said Scott Michael, President and CEO of the United Motorcoach Association.
“When the pandemic brought the entire U.S. motorcoach industry to a halt, and numerous small, multigenerational family businesses were faced with the potential of having to permanently close, Congress provided a lifeline with the CERTS grant program. The invaluable relief to the U.S. motorcoach industry and its workers also ensured that thousands of rural and underprivileged communities would not lose their only mode of intercity transportation,” said Peter Pantuso, President & CEO of the American Bus Association. “However, unlike other pandemic relief programs, CERTS grants were inadvertently treated as taxable, which meant that as motorcoach operators across the country were trying to recover and resume normal operations, they got hit with an unexpected tax bill and essentially had to return a significant portion of relief funds to the government in the form of a tax payment. Senators Marsha Blackburn, Jack Reed, Susan Collins, Jeanne Shaheen, Steve Daines, and Bob Casey have long been champions of the U.S. motorcoach industry, and the American Bus Association is extremely grateful to the Senators for their continued support and leading the charge to fix this oversight by introducing the CERTS Tax Exemption Act.”
“On behalf of the nation’s private school bus contractors and 40% of the nations’ schoolchildren that rely on them for transportation to and from school, the National School Transportation Association (NSTA) thanks Senators Jack Reed and Marsha Blackburn as well as Senators Susan Collins, Bob Casey, Steve Daines and Jean Shaheen for introducing a bill to establish fair tax treatment for CERTS funds, ” said Curt Macysyn, Executive Director of NSTA. “The private school bus industry suffered significant monetary losses during the COVID-19 pandemic, when many school districts refused to pay contractors during closures. School bus operators are still recovering, and we appreciate the support of the first Senate bill to correct the oversight on tax status of CERTS funds.”
“Grants from the CERTS program were a lifeline for U.S. passenger vessel operators during the coronavirus pandemic,” said John Groundwater, Executive Director of the Passenger Vessel Association. “Unlike the Paycheck Protection Program and the Restaurant Revitalization Program, which were both tax free, CERTS grants were taxable. We believe this was simply an oversight and we urge Congress to take the necessary steps to make CERTS non-taxable. We commend Senators Blackburn and Reed for their leadership in reintroducing this important and needed legislation.”
BACKGROUND:
- The bipartisan Coronavirus Economic Relief for Transportation Services (CERTS) Act, included in the December 2020 COVID relief package, provided $2 billion in emergency funding for the motorcoach, bus, and passenger vessel companies.
- While this program provided a much-needed lifeline to this industry, their grants were not exempted from taxation like other grants such as the Paycheck Protection Program, the Restaurant Revitalization Funding, and the Shuttered Venue Operator Grant Program.
- As a result, many businesses that accepted funding through the CERTS program now face large tax bills through no fault of their own.
This bill would exempt them from taxation and put the CERTS program at par with the rest of the relief programs passed during the same period.