Washington, DC – U.S. Senator Sheldon Whitehouse today joined President Joe Biden at the White House to take part in a ceremonial bill signing for the Inflation Reduction Act, landmark legislation that will lower energy and health care costs for Rhode Islanders, and drive down the emissions causing the climate crisis. All 50 Senate Democrats and Vice President Harris voted last month to pass the Inflation Reduction Act.
“I’m thrilled to join President Biden for this historic occasion. Our Inflation Reduction Act will lower Rhode Islanders’ energy and health care bills and create good jobs in the Ocean State. With this new law, Democrats have allowed Medicare to finally begin negotiating drug prices, and we’ve gotten billionaires and the wealthiest corporations to start paying a fairer share,” said Whitehouse. “I worked tirelessly to help shape major climate components of the bill, which are expected to significantly increase the rate of emissions reductions. While there’s still much more to do to lead the planet to safety in the race against climate change, momentum is on our side today.”
The major climate provisions developed by Whitehouse or modeled after legislation he authored include a suite of clean energy programs that Whitehouse helped shape in the Finance Committee, including the provision to incentivize the production of sustainable aviation fuel and the provision to increase the 45Q tax credit for carbon capture and sequestration. The legislation also contains other major climate provisions modeled on legislation authored by Whitehouse, including grant programs inspired by the Senator’s Clean Industrial Technology Act to decarbonize emissions-heavy sectors and a methane reduction program for oil and gas facilities that grew out of Whitehouse’s methane fee proposal.
From capped prescription drug costs for seniors to substantial rebates for efficient home appliances and retrofits to lower health insurance premiums, Rhode Islanders will soon see the results of the Inflation Reduction Act up close. By insulating consumers from volatile fossil fuel prices, the average household is expected to see $170-$220 in annual savings from reduced electricity costs. Households that take advantage of the various tax credits in the Inflation Reduction Act will see even larger savings, as their heating and transportation costs decline.
Whitehouse-backed measures in the bill include:
Health Care
- Allows Medicare to negotiate drug prices: Lower prices on the most expensive drugs for the 224,000 Rhode Islanders enrolled in Medicare.
- Extends American Rescue Plan Tax Credits for health insurance through 2025: For the average 50- to 64-year-old Rhode Islander who gets health insurance through HealthSource RI, the expanded tax credits will provide $787 in annual savings on marketplace premiums.
- Medicare Part D $2,000 Out-of-Pocket Cap: Thousands of Rhode Islanders will benefit from a $2,000 per year out-of-pocket max in Medicare Part D. All Medicare Part D beneficiaries will be protected from going bankrupt because of an unexpected diagnosis.
- $35 cap on insulin costs for Seniors: For the 11,000 Medicare beneficiaries in Rhode Island who use insulin, their out of pocket costs will be capped at $35.
Energy
- Clean Energy Tax Credits: Extends the full value of tax incentives for solar, wind, and other clean energy technologies to projects that meet certain labor requirements. Includes a tax credit for energy storage, hydrogen, and existing nuclear, and increases the value of the carbon capture (45Q) tax credit.
- Home Energy Performance-Based Whole House Rebates: $4.3 billion over ten years to state energy offices to develop and implement a HOMES rebate program to significantly reduce home energy bills.
- High-Efficiency Electric Home Rebate Program: Based on legislation Whitehouse cosponsored, $4.3 billion over ten years to state energy offices to provide families rebates for efficient appliance upgrades, weatherization, and other retrofits.
- State-Based Home Energy Efficiency Contractor Training Grants: $200 million for grants to states to develop and implement programs to train contractors to install home energy efficiency and electrification improvements.
- Greenhouse Gas Reduction Fund: Establishes a $27 billion program to provide grants, loans, and other forms of assistance to support deployment of zero-emission technologies. Of this, $7 billion will be dedicated to supporting state green banks.
- Improving Energy Efficiency or Water Efficiency or Climate Resilience of Affordable Housing: $837.5 million to make affordable housing more efficient and resilient.
Transportation
- New Electric Vehicles: Through 2032, credit is $7,500 per new vehicle, subject to vehicle price and household income caps. Removes the manufacturers’ cap.
- Used Electric Vehicles: Through 2032, claim the lesser of $4,000 or 30 percent of the sale price, not to exceed $25,000. It must be a model year at least 2 years earlier than the date of sale, subject to household income caps.
- Alternative fuel vehicle refueling property: Extended through 2032. Provides up to $100,000 for each charging station or refueling pump installed.
- Clean Heavy-Duty Vehicles: $1 billion over ten years to eligible recipients and contractors for heavy-duty zero emission vehicles, including school buses.
- Grants to Reduce Air Pollution at Ports: $3 billion over five years for a competitive grant and rebate program to support installation of zero-emission equipment or technology at ports.
- Low-Carbon Transportation Materials Grants: $2 billion over five years to the Federal Highway Administration to reimburse the cost difference between low-embodied carbon materials and traditional materials used in highway construction projects – a priority in Whitehouse’s IMAGINE Act.
- Neighborhood Access and Equity Grants: $1.9 billion over five years for a competitive grant program at Federal Highway Administration to improve walkability, safety, and affordable transportation access.
Progressive Tax Reforms
- 15% Domestic Corporate Alternative Minimum Tax: For years, many giant corporations have gotten away with paying nothing in taxes, leaving small businesses and working families to pick up the tab. Whitehouse was an original cosponsor of this legislation to require companies with over $1 billion in profits to pay at least a 15 percent rate. This is a major step forward in combating corporate tax dodging, and will help level the playing field for businesses large and small that pay full freight.
- IRS Funding: After years of Republican budget cuts, this bill provides $80 billion of mandatory IRS funding, which will allow the agency to crack down on wealthy tax cheats, provide better service to those who pay what they owe, and reduce the deficit by roughly $400 billion. As Chair of the Tax and IRS Oversight Subcommittee, Whitehouse helped lead the effort to secure this funding in the bill.
- Excise Tax on Stock Buybacks: Too many large corporations have plowed record profits into stock buybacks, enriching wealthy shareholders and their CEOs instead of investing in their workers or growing their businesses. This bill imposes a 1 percent annual excise tax on the value of stock repurchases by publicly traded corporations.
- Extension of limit on excess business losses: The legislation extends a limit to prevent the ultra-wealthy from using excess business losses that exist on paper to avoid taxes on unrelated income. It raises over $50 billion, and follows the lead of legislation from Senator Whitehouse that would permanently close this loophole unavailable to typical working families.
Environment and Environmental Justice
- Coastal Funding: $2.6 billion to National Oceanic and Atmospheric Administration to provide funding to coastal states for the conservation, restoration, and protection of coastal and marine habitats and resources, including fisheries.
- NOAA Funding: $320 million for the construction of new National Oceanic and Atmospheric Administration facilities, more efficient permitting processes, and research improvements.
- Air Quality Monitoring: $235.5 million for state air quality monitoring and pollution control programs.
- Environmental and Climate Justice Block Grants: $3 billion for grants and technical assistance to community-based organizations for projects to monitor and mitigate air pollution and climate change.
President Biden officially signed the Inflation Reduction Act into law on August 16.
Meaghan McCabe, (401) 453-5294
