Bill takes aim at all remanufacturing segments, including the aftermarket industry
"By extending a product's life, you're doing wonders for the environment," says William Gager, president of the Automotive Parts Remanufacturers Association (APRA). "Remanufacturing is also helpful because it makes products available that may not normally be available in the marketplace."
A long-time advocate of remanufacturing, Gager is currently working with Rep. Philip English (R-Pa.) to win support for a remanufacturing tax credit bill. The bill, H.R. 5659, would enact a 20 percent tax credit for equipment that would be available to those who directly engage in remanufacturing, as well as those who serve a specific function in manufacturing that meets the definition of remanufacturing. For example, if a company collects and distributes cores for remanufacturing in the United States, it would be entitled to a credit for its investment in trucks, computers, forklifts, cleaning equipment and office furniture.
Although it's not specifically designed to support the aftermarket industry, H.R. 5659 will definitely benefit automotive parts manufacturers, Gager says.
"Think about it. Once you get beyond five or 10 years, the odds of finding a new part for your old truck are pretty slim," he adds. "Remanufacturing is needed to keep our nation's cars and trucks going. If you use a remanufactured part, you're extending a product's life while doing something good for the environment."
In addition to the financial benefits, the bill will allow individual U.S. companies to become just a little more competitive, primarily with foreign companies and the products they import, Gager notes.
According to English's office, the legislative objective for the recycling and remanufacturing tax credit is to encourage environmentally beneficial remanufacturing and recycling in a manner that meets the country's policy objectives while at the same time creating an incentive that will generate needed employment in the United States. But it will also free up more capital, allowing companies to invest money in other areas where it is needed.
In addition, the bill will benefit various U.S. manufacturing segments by creating jobs and teaching employees new skills; conserving energy; improving equipment life and the conservation of materials; prolonging the useful life of consumer products and expanding market alternatives; and balancing U.S. trade.
"As the new, energy-efficient era rapidly moves forward, it is essential for American manufacturers to remain on the forefront of innovation," English says. "This legislation speaks to the needs of the 21st century economy. It will help conserve energy and improve the balance of our trade. It does a better job of reusing materials and taking recycling to the next level. Overall this legislation is a win-win initiative that will allow American employers to continue to grow their business, create new jobs for local communities and meet the environmental demands of the modern day," he adds.
The bill is currently making its way through Congress, and has been introduced to the House Ways and Means Committee.
Sidebar:
Gager is no stranger to lobbying congressional representatives; in 1999, he had been working to get a similar remanufacturing tax credit bill enacted. The bill was re-introduced in 2001 and he lobbied hard – receiving support from approximately 70 politicians who vowed to sign on as co-sponsors to the bill. But disaster struck, in the form of 9/11. The bill was tabled, after Pres. George W. Bush passed a stimulus package that included an equipment tax credit to get the economy going again.
"If I had stood up in Congress after 9/11 and talked about an additional equipment tax credit, that would have been ludicrous," Gager says.
However, during a visit to Representative English last year, Gager was happy to reintroduce the idea of the tax credit. English agreed that concerns about energy and other global issues made it a good time to move on the bill, and a partnership between the two men was born.
"Many representatives see this as a pro-environmental bill that makes sense," notes Gager. "It encourages the remanufacturing industry to do a lot of good things for the environment and for the country."
