Chemical Industry Advocates Converge on Capitol Hill for Security, Tax Reform
The Alliance for Chemical Distribution (ACD) kicked off its annual legislative summit in Washington, D.C., May 14, where industry representatives are lobbying lawmakers to address several issues affecting the industry’s supply chain and security.
Among the issues the group plans to discuss is the reauthorization of the expired Chemical Facilities Anti-Terrorism Standards, or CFATS, tax reform and the renewal of trade legislation that has provided duty-free status for certain chemical imports.
More than 100 members and staff from ACD are meeting with legislators in the nation’s capital over two days, according to an ACD news release. Most ACD members are smaller chemical distributors with about 30 employees on average and $42 million annually in sales. The group is seeking tax policies that can help small businesses be more competitive.
“The chemical distribution industry is made up of experts who navigate a constantly evolving supply chain and regulatory landscape,” said Eric Byer, president and CEO of ACD. “Our members are our best advocates, and through open conversations on the most pressing issues facing our industry, we aim to drive progress on the key legislative and regulatory challenges that are central to the competitiveness of our industry and the success of countless other sectors that depend on the chemical supply chain.”
Byer has been an advocate for reinstating CFATS, saying his members need the extra protections afforded by CFATS.
“Without the vital support of this successful public-private partnership, high-risk chemical facilities are left to manage site security, mitigate vulnerabilities and ensure comprehensive employee background checks on their own, ACD stated in a news release. “This is particularly concerning as chemical facilities and surrounding communities face increased exposure to new threats and potential acts of terror.”
CFATS officially expired on July 27, 2023, meeting opposition from Republican Sen. Rand Paul of Kentucky, who says the measure is a burden on small businesses.
ACD also is seeking approval of the expired Generalized System of Preferences Trade Program and Miscellaneous Tariff Bill, which provided tax relief on imported chemicals that are not available domestically.
In addition, the industry has benefitted from a 20% small business tax deduction established under the 2017 Tax Cuts and Jobs Act, according to ACD.
The group is asking Congress to pass the Main Street Certainty Act, reintroduced in the House by Republican Rep. Lloyd Smucker of Pennsylvania in January and in the Senate by Sen. Steve Daines, a Republican from Montana. The bill would make the 20% deduction permanent.
ACD also is taking aim at the Trump administration’s tariffs on Chinese vessels, export restrictions on U.S. liquified natural gas and proposed duties on Chinese equipment.
The new fees could increase costs for U.S. shipbuilders, placing additional burdens on U.S. businesses, Byer said.
“Onerous administrative burdens, unnecessary costs, and supply chain disruptions are causing serious uncertainty for our members and their customers,” he said. “Chemical distribution contributes more than $27.5 billion to the U.S. economy. While most of ACD’s members are small businesses, our industry has a big impact, and Congress must support commonsense policies that ensure the success and growth of chemical distribution today and in the months and years to come.”
