[Congressional Record Volume 162, Number 142 (Tuesday, September 20, 2016)]
[House]
[Page H5679]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
EMERGENCY CITRUS DISEASE RESPONSE ACT OF 2016
Mr. BUCHANAN. Mr. Speaker, I move to suspend the rules and pass the
bill (H.R. 3957) to amend the Internal Revenue Code of 1986 to
temporarily allow expensing of certain costs of replanting citrus
plants lost by reason of casualty, as amended.
The Clerk read the title of the bill.
The text of the bill is as follows:
H.R. 3957
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Emergency Citrus Disease
Response Act of 2016''.
SEC. 2. EXPENSING OF CERTAIN COSTS OF REPLANTING CITRUS
PLANTS LOST BY REASON OF CASUALTY.
(a) In General.--Section 263A(d)(2) of the Internal Revenue
Code of 1986 is amended by adding at the end the following
new subparagraph:
``(C) Special temporary rule for citrus plants lost by
reason of casualty.--
``(i) In general.--In the case of the replanting of citrus
plants, subparagraph (A) shall apply to amounts paid or
incurred by a person (other than the taxpayer described in
subparagraph (A)) if--
``(I) the taxpayer described in subparagraph (A) has an
equity interest of not less than 50 percent in the replanted
citrus plants at all times during the taxable year in which
such amounts were paid or incurred and such other person
holds any part of the remaining equity interest, or
``(II) such other person acquired the entirety of such
taxpayer's equity interest in the land on which the lost or
damaged citrus plants were located at the time of such loss
or damage, and the replanting is on such land.
``(ii) Termination.--Clause (i) shall not apply to any cost
paid or incurred after December 31, 2025.''.
(b) Effective Date.--The amendment made by this section
shall apply to costs paid or incurred after the date of the
enactment of this Act.
The SPEAKER pro tempore. Pursuant to the rule, the gentleman from
Florida (Mr. Buchanan) and the gentleman from Michigan (Mr. Levin) each
will control 20 minutes.
The Chair recognizes the gentleman from Florida.
General Leave
Mr. BUCHANAN. Mr. Speaker, I ask unanimous consent that all Members
have 5 legislative days in which to revise and extend their remarks and
to include extraneous material on H.R. 3957, currently under
consideration.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from Florida?
There was no objection.
Mr. BUCHANAN. Mr. Speaker, I yield myself such time as I may consume.
This bill makes a slight change to the existing law in order to help
struggling farmers.
The U.S. citrus industry faces a grave threat from an incurable
bacterial disease called citrus greening. While not harmful to humans,
it results in bitter, hard, misshapen fruit and eventually causes trees
to die.
The disease arrived in Florida in 2005 and has since infected 99
percent of the commercial citrus groves in my State as well as 50
percent of the groves in Texas. Greening has begun to march across the
country and has been found in California, Louisiana, South Carolina,
and Georgia. Once infected, trees must be uprooted and destroyed.
Replacing citrus trees is costly, but farmers have no choice as they
must replant in order to earn a living. This disease has put 62,000
citrus jobs at risk in my State alone.
The Tax Code currently allows farmers to fully deduct the cost of
replanting trees that are damaged by drought, disease, or pests; but
the current rule has a significant limitation: in order to get the
deduction, the farmers must bear the costs of replanting the trees
themselves.
My bill would let farmers bring in investors to help underwrite
replanting costs without losing the immediate deduction; and, to ensure
that farmers keep working their land, my bill requires them to maintain
at least a 50 percent interest in their groves in order to use this
deduction.
This commonsense, limited change to an existing provision in the Tax
Code has broad, bipartisan support. In fact, every member of the
Florida delegation, which is about 29 members--Democrats and
Republicans alike--support this proposal. Citrus growers in Florida,
Texas, and California have all come out in support of the bill for one
simple reason: nationwide, nearly 20 million trees will need to be
replaced due to greening.
Mr. Speaker, I reserve the balance of my time.
Mr. LEVIN. Mr. Speaker, I yield myself such time as I may consume.
There is no doubt the citrus industry is facing an emergency. A
disease, referred to as ``greening,'' is rapidly spreading among citrus
crops, including oranges, tangerines, grapefruits, lemons, and limes.
To date, Florida orange growers have been hard hit by this disease and
have been forced to abandon more than 100,000 acres of groves. It takes
about 2 years for the disease to fully manifest itself; therefore,
citrus crops in Texas and in California are also at risk. This bill
would expand an exception that allows for the immediate expensing of
replanting costs when crops are destroyed by this disease.
Under current law, minority investors only are allowed to immediately
expense costs incurred for replanting when, one, the grower who
incurred the loss or damage keeps a more than 50 percent interest in
the property and, second, when the minority investor materially
participates in the planting, maintenance, cultivation, or development
of the property.
Under this bill, minority investors also would be able to immediately
expense costs incurred for replanting if, one, the grower has an equity
interest of not less than 50 percent in the replanted citrus plants,
and the minority investor holds the remaining interest or, two, if the
minority investor acquires all of the taxpayer's land on which the lost
or damaged citrus plants were located, and the replanting is on such
land. This bill would not require minority investors to materially
participate in the planting and growing, thus making it more appealing
for investors.
At a cost of $30 million over 10 years, this bill takes a modest step
in helping the citrus industry attract investors and much-needed
capital to fight this devastating disease.
Mr. Speaker, I yield back the balance of my time.
Mr. BUCHANAN. Mr. Speaker, I urge Members to pass this bill so that
struggling farmers can have the flexibility to use the existing
provisions of the Tax Code in a more ownership-type structure. Without
this change, we run the risk of losing tens of thousands of jobs.
I yield back the balance of my time.
The SPEAKER pro tempore. The question is on the motion offered by the
gentleman from Florida (Mr. Buchanan) that the House suspend the rules
and pass the bill, H.R. 3957, as amended.
The question was taken.
The SPEAKER pro tempore. In the opinion of the Chair, two-thirds
being in the affirmative, the ayes have it.
Mr. HUELSKAMP. Mr. Speaker, on that I demand the yeas and nays.
The yeas and nays were ordered.
The SPEAKER pro tempore. Pursuant to clause 8 of rule XX, further
proceedings on this motion will be postponed.
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