Federal Disaster Tax Relief Act of 2023

Madam President, as if in legislative session, I ask unanimous consent that the Committee on Finance be discharged from further consideration of H.R. 5863 and the Senate proceed to its immediate consideration.

Madam President, I ask unanimous consent that the bill be considered read a third time.

I know of no further debate on the bill.

Madam President, I ask unanimous consent that the motion to reconsider be considered made and laid upon the table.

Madam President, I thank you for that.

For the folks watching at home, we just passed a significant disaster tax bill, which is critical to helping disaster survivors across the country, and it includes bipartisan legislation that I introduced, along with Senator Wyden and Senator Cassidy.

Our Protect Innocent Victims Of Taxation After Fire Act would make sure that individuals, families, and entire communities who have suffered from utility-caused wildfires can receive the full compensation to rebuild their lives without fear that their settlement payments will be subject to taxes.

In my home State of California, over 70,000 people have been impacted by the destruction of the Butte fire, the North Bay fire, and the Camp fire in recent years.

Now, if you can imagine when you are wading through the ashes of your former home and thinking about how you can possibly begin to rebuild, the last thing you should have to worry about is that the government is going to tax the payment from your legal settlement that already fails to cover the full cost of your losses in the first place.

Disaster settlement funds aren't income. It is not an asset. It is compensation for what a family has lost. It is meant to be an opportunity to begin to rebuild your life--an opportunity that should not be diminished because our Tax Code is outdated.

And it is not just for my constituents--my constituents looking to rebuild--utility-caused fires are becoming increasingly common across the Western United States. This bill we just passed would make sure that all recent and future wildfire victims throughout the country have access to their full settlements. That includes those in Oregon and Hawaii who have either reached settlements or are still working through the process with the utilities that caused devastating wildfires.

This measure is a commonsense, bipartisan solution to protect Americans at the most difficult time in their lives.

I want to take a moment to thank Senator Cassidy and Senator Wyden for their partnership, as well as my California colleagues in the House, Representatives Mike Thompson and Doug LaMalfa, for their leadership on the issue in that Chamber. I look forward to seeing the President sign this bill into law as soon as possible.

I yield the floor.

Madam President, I also rise today with the bittersweet task of saying farewell to my trusted partner for the State of California, Senator Laphonza Butler, as her tenure here in the Senate with us comes to end in the coming days.

You may recall that just over a year ago, Senator Butler was appointed to serve alongside me here in the U.S. Senate. I remember it vividly. In just a matter of days, she received a call from Governor Newsom, accepted the appointment, traveled to Washington to take the oath of office, and introduced herself to the Nation.

That alone is a tall task for anyone--imagine--to be called upon on such short notice to serve a State of nearly 40 million people--but it is another thing entirely to be asked to also, in the process, fill the shoes of the legendary Senator Dianne Feinstein, a titan of California politics and the U.S. Senate, who served with such honor and dignity and grace for over three decades, not to mention that she carried on her shoulders the fate of a narrow Senate Democratic majority. It literally rested on her appointment and willingness to serve. But as I think back and reflect on that moment in her decision to say yes, it takes a trailblazer to fill the seat of a trailblazer.

And Laphonza Butler was certainly no stranger to high stakes. She knew it and proved it as a union organizer, fighting for workers all across the Nation; she knew it as the onetime president of California's SEIU Local 2015, representing members of California's largest home care and nursing home workers union; and she knew it as president of EMILY's List--all leadership positions that she held prior to joining us here in the Senate. So once she did join us here in the Senate, it was no surprise to me that she hit the ground running. She immediately set up an office and built a team of more than capable and passionate public servants who would help her and my office, frankly--we are a tag team, after all--serve the people of California.

Imagine, as she began to navigate the complex Senate procedures to effectively represent Californians, she was also learning, in the early days, how to simply navigate the halls of the U.S. Capitol--with the help of the legendary Alex Baldonado, I might add.

I was honored to serve alongside her here in the Senate, to offer her advice when I could and even lend staff assistance. In the year that has followed, I have been proud to work with her, nominating and confirming historic judicial nominees to the Federal bench, fighting for critical disaster funding for Californians in the relief we just passed a few minutes ago, working to protect and conserve our cherished public lands, and so much more.

Through it all, Senator Butler worked to also lift up the voices of all Californians, including through her Youth Advisory Council, empowering young Californians to get involved in the civic process.

So, Senator Butler, let the Record reflect that it has been an honor to serve alongside you these past 14 months. While we will miss you here in the U.S. Senate, I know that your work is far from over and that our partnership will continue. I have no doubt that I will see you in the trenches.

I yield the floor.

Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, I rise today in strong support of this legislation, and I thank Chairman Smith of the Ways and Means Committee for all the good work

he has done to ensure that we are able to help our constituents who are suffering as a result of natural disasters. I also thank my colleague and friend, Mr. Steube, without whose leadership on the Ways and Means Committee we wouldn't be here today. I also thank Mr. LaMalfa, my colleague to the north of my district, who has worked with me over the years to address one component that is covered by this piece of legislation.

This has been a long time coming for my constituents--too long, way too long. This is now the second time in 5 months that this House has come together to state plainly and in a bipartisan fashion that Americans should help one another when disaster strikes, while the Senate continues to play politics with what ought to be a bipartisan victory. They have been sitting on the tax bill for 5 months. I join Chairman Smith in calling for them to move the entire bill because there is so much in it for so many of our constituents across the country.

I want to briefly reiterate how we got here today. In my district, wildfires in 2015, 2017, and 2018 devastated entire communities across my district and across the State of California. Entire towns were destroyed. Thousands of people lost homes, and dozens of people lost their lives.

In the aftermath, the courts found that Pacific Gas and Electric was liable for causing some of these fires. As part of its subsequent bankruptcy proceedings, the utility established a trust from which fire survivors are generally eligible for compensation for losses sustained during these fires.

Let me pause here to say one thing. No disaster survivor is ever made whole. No one is ever made whole. People lost their homes and everything in their homes--family pictures, family heirlooms, family records. They lost businesses. As I said earlier, sadly, they lost family members.

While the courts eventually created a path to compensation, it took years to get there, years my constituents didn't have. They couldn't wait around for 3, 4, 6 years to get a payment from that trust. Then, because the trust was structured in the form of stock shares and because stock shares need to be monetized carefully and slowly in order to maximize return to survivors, the payments to survivors came in batches. Nobody is getting--repeat, nobody is getting--100 percent of what they lost.

To add insult to injury, right as our constituents started to get a little bit of compensation, our constituents were told they may actually owe taxes on these payments because, depending on the taxpayer, the payments may qualify as income. In 4 years of working on this issue, I have yet to encounter a single person on either side of the aisle who believes this is fair. That is why we have been so successful in passing this legislation numerous times out of the Ways and Means Committee and off the floor of this House.

This bill has been stalled, advanced, and then held up. It has been marked up, passed the House, and stalled again. The Senate ought to quit dithering on what is an objectively good bill for our country and just pass it, but because they are unwilling to do so, we are here again tonight to take this matter up.

As I said, I am grateful to my colleagues on both sides of the aisle. Mr. Neal, our ranking member on Ways and Means, has been a great colleague and a great champion for this. I also thank the chairman, Mr. Smith, and Mr. Steube, one of our colleagues on the committee.

I wish such an unusual strategy to get here wasn't necessary, but I am committed--and I think my colleagues here are committed--to pulling every lever at our disposal to get this bill passed. This is a fundamental question of fairness, and I urge all of my colleagues to vote in favor of this bill.

Mr. Speaker, I reserve the balance of my time.

Mr. Speaker, I yield 2 minutes to the gentlewoman from Hawaii (Ms. Tokuda), who knows firsthand the tragedy of wildfire.

Her constituents experienced a horrific disaster in her district, in her home State, and she has been there with them every step of the way. She is

here on their behalf again tonight. I thank her for her support.

Mr. Speaker, I yield myself the balance of my time.

Again, I thank Mr. Steube, Mr. LaMalfa, Chairman Smith, and all of our colleagues on Ways and Means who worked so hard to bring this bill to fruition not once, not twice, but now three times.

I know how difficult it is for our friend from Hawaii, in her area. What a devastating fire that was, and I know how hard she is working for her constituents. I thank her for being on the floor today.

Mr. Speaker, Florida, Texas, South Carolina, Louisiana, Kentucky, Oregon, New York, California, and over a dozen other States have been devastated by disasters. There is not a single colleague in this House who should have to go through a disaster to know how bad it is. It devastates communities. It devastates people's lives. It disrupts communities. It disrupts people's lives. People are killed. Businesses are lost. Homes and heirlooms are lost and destroyed.

The least that we can do is to come to the aid of our constituents, our fellow Americans, in time of disaster and in time of great need. That is what we are doing today.

This is commendable work by the Ways and Means Committee, and every Member of this House should be proud to come to the floor and vote to support their friends, their neighbors, and their constituents in these very dark times.

Mr. Speaker, I yield back the balance of my time.

Mr. Speaker, I thank Chairman Smith for helping us with our legislation all this time here, and I am very grateful also to Mr. Steube for allowing our bill to be piggybacked with his in this effort here, as well as H.R. 7024, Tax Relief for American Families and Workers Act of 2024, which is still waiting over in the Senate. I hope we can get that one passed, but I am grateful for everybody to join this effort here today in a strong, bipartisan effort to move this narrower, very important disaster relief package to help people all across the country, as has been said.

Mr. Speaker, I thank my colleague, Mr. Thompson of California, so much for our partnership on this. It has taken some time, but we are getting there. I am glad to see it.

With the losses we have suffered along with our constituents-- especially our constituents, of course--it is very painful to see and not be able to go back to them and say we have gotten a result.

My own constituents, I commend them. I am grateful for them. They have been very patient, the victims of the Camp fire where 85 lives were lost, the victims of the Zogg fire, my neighbors down there in the Santa Rosa area, and of course, my good friend, Ms. Tokuda. Lahaina suffered an even greater loss of life than what we had in Paradise, which was a record. We don't want to set records. We want to get results.

It has been a great partnership on top of disaster and heartache.

Just picture this, though, as I talk about Paradise: You wake up in the morning, and you hear there is a fire. All of a sudden, there is an evacuation. People are crowding the narrow roadways, trying to get up the hill or down the hill out of town, barely making it in some cases, scorched vehicles, tires on fire, all of that.

They are seeing in their rearview mirrors their neighborhood engulfed in flames and their houses burning down with all their mementos, as was mentioned, in them.

They are wondering: Did their neighbor get out? Did the elderly lady up the street get out? Thank goodness there was a firefighter or neighbor that maybe helped that lady get out just in time, so there was not even a bigger loss of life.

The resilience of these folks in the fires that I have had in my district and my neighbors in our neighboring States is just amazing as they have stuck with us on this.

A settlement happened with the utility to somehow partly compensate them, and indeed, they will never be made whole.

My colleagues have pointed that out well. They can never be made whole, even with a lot of money. That settlement should not be a taxable event.

Think about it. Just break that down for a minute. You are in your home, and you have been paying off your mortgage. Maybe it is already paid off. You have your equity in your home. This disaster happens, and you lose your home. All of a sudden, you have to rearrange your life. You have to rebuild your life. That portion of that equity that now is going to be compensated for partly by the settlement with the utility, that portion of your home, is now a newly taxable event because of the IRS' interpretation of that.

How is that right? How is that fair at all? Someone is ripped out of their life, home, family, whatever may have happened to them personally, and now they have a taxable event on top of that piece of equity that was in their home because of a bad interpretation here.

That is why this legislation is necessary. That is why it has been so strongly supported on both sides of the aisle all through the process here. That is why we need to overcome these hurdles we have, whether it is over in the Senate or what have you, to get this done.

People deserve to have that predictability, that sustainability of their lives, to be able to put themselves back in a good way again.

To the fire victims of the Camp fire in my area, the Zogg fire, our other neighbors out there, relief is on the way.

This has been a tremendous effort, a little out of the ordinary, to get this legislation back to this floor here tonight, and I think it will pass resoundingly. I hope so. I ask for everybody's ``aye'' vote.

Again, I appreciate all of my colleagues on both sides of the aisle for stepping forward and doing right by the fire victims, by the hurricane victims, by those folks in East Palestine, and by others who are going to be added to this.

This is how legislation should look. This is how a country pulls together, and I am glad to be part of it.

Madam President, while he is on the floor, let me thank Senator Padilla for our partnership, these many months, and also to Senator Cassidy. And we Westerners have really strong views about this because the fires of the West today are not your grandfather's fires. They are bigger. They are hotter. They are more powerful. They are leaping over rivers. And the families that my colleague and I are talking about feel like they have been hit by a wrecking ball.

And after getting clobbered, they are saying to themselves, why can't I get a fair shake from the government? Why are they hitting me again, even though I don't have any income--as my colleague has said so well. These are people who have truly been visited by a disaster. Their homes and their businesses are burned. Their possessions and livelihood are gone.

And finally, the Federal Government is showing some common sense. That is what my friend from California has spelled out. Our effort is going to lift a big tax burden off these victims of wildfires and other natural disasters. We are getting rid of a totally unfair tax on legal fees associated with settlements after disasters. And by the way, we are fixing something that went haywire in the Republican's 2017 tax bill.

Now, we have been pushing our colleagues in a bipartisan way for months to do a bill that addresses this and other issues. I see in the Chair another very valuable member of the Finance Committee, our friend from New Hampshire Senator Hassan. And she and I and others had a bill that got 357 votes in the House of Representatives that included this important legislation that Senator Padilla and Senator Cassidy and I have worked on.

I told my colleague that we had our 1,100th townhall meeting where the victims came and said: Ron, will it ever get done?

And I said: You bet it is going to get done. It is going to get done in the lameduck session.

They said: Why hasn't it happened earlier?

And the reality is, it should have happened earlier because you don't get 357 votes very often over there in the House of Representatives. It doesn't happen by osmosis. It is because my colleagues here are working in a bipartisan way and wanted to get this done.

So, we wanted, frankly, to do more. We wanted to do it earlier. But I say to my colleagues that we are going to keep going on the things from that package that got 357 votes in the House, like research and development expensing, which our friend from New Hampshire has championed, and ending double taxation between the U.S. and Taiwan.

But tonight, is an evening when Senator Padilla and I have said, finally, after all this waiting, we are going to see relief for these people who have been clobbered by these huge infernos--because that is the only way to describe our fires, Senator Padilla. These are infernos. It gets hot and dry on the forest floor. Somebody drops a match, maybe there is a lightning strike. Kaboom--and those people are finally tonight, through the work that has been done by my friend from California, and our friend from Louisiana, and a lot of Senators-- Senator Schatz is another example--we are going to be able to tell folks in the West--it is only 5 o'clock or so in California and Oregon--who have been hit by these big fires, they are going to be able to go to bed tonight with a little relief that the Federal Government has finally come to its senses and made sure that they are not going to have this additional tax burden.

So, I want to thank my friend from California for his good work. He has been a terrific partner. I think it is very fitting that the Senator from New Hampshire is in the Chair because she, more than anybody than I know of on our committee, was really putting in the sweat equity for a bipartisan bill.

This is a good night for the people that we represent in the West. It is a good night for a lot of other people in this country. And I want to thank my colleague and the person who has led us on so many of these issues from New Hampshire, Senator Hassan, because we are finally getting justice and a fair shake for people who did nothing wrong who have been visited by these fires and these disasters.

And the Federal Government is showing some common sense, which most of them, I think, would agree should have been shown quite some time ago. I thank my friend.

I yield the floor.

Mr. Speaker, I stand in support of H.R. 5863, the Federal Disaster Tax Relief Act of 2023.

In a historic act, last week, a majority of the House of Representatives made clear that the House should act to provide tax relief to victims of natural disasters all across America. I thank every Member who stood with me in this fight, and I am thankful that this bill is finally being debated on the floor.

On September 28, 2022, southwest Florida was ravaged by Hurricane Ian, one of the most devastating hurricanes to ever hit our Nation. NOAA ranks Hurricane Ian as the third most costly hurricane in United States history, killing nearly 150 people and causing billions of dollars in damages. For Floridians, we know that the recovery from Hurricane Ian is far from over.

Despite experiencing numerous hurricanes yearly, Floridians are resilient. I have been working tirelessly on disaster relief legislation for Floridians to recover from various storms that have decimated so many communities around our State. The most recurring and pressing issue I hear in my district is that the sun coast is still waiting for Congress to do its job to provide much-needed relief.

More than a year-and-a-half after landfall of Hurricane Ian, Congress has yet to provide disaster relief for those impacted financially by Ian. I have received thousands of letters, calls, and pleas for help from people in my district who have incurred tens of thousands of dollars in recovery expenses and are having a hard time getting ahead.

On eight separate occasions since 2002, Congress has provided tax relief to victims of natural disasters. Since 2021, over 300 disasters across 47 States have been declared without Congress taking action.

Additionally, wildfires across the Western United States and Maui have greatly impacted many Americans who have not received any relief from this body. Similarly, the victims of the East Palestine train derailment are facing the same situation.

This bill helps everyday Americans and provides them the ability to deduct their expenses from a natural disaster from their taxes.

This bill will not just aid Hurricane Ian victims. It will provide relief to the millions of Americans around the country who are victims of federally declared disasters. It will help victims of flooding in the Midwest. In the Pacific Northwest, victims of wildfires will get the relief they deserve. Those affected by severe winter storms in the Northeast will benefit from this tax deduction, as will our friends in Texas who have experienced damage from a wide variety of disasters, including winter storms, tornadoes, flooding, and fires.

In short, this is not a problem that just affects Florida or California. This impacts millions of American families, and Congress must act to provide them relief.

I am grateful to be supported by many of my colleagues on both sides of the aisle to lead the fight for Americans all across the country to get disaster relief. Disaster relief is not a Democratic problem or a Republican problem. It is something that all of us face.

I give sincere thanks to Members and staff who have worked tirelessly on this bill. I give special thanks to California Congressmen Mike Thompson, Jimmy Panetta, and Doug LaMalfa, as well as Congresswoman Jill Tokuda of Hawaii, for their leadership on this effort.

I also thank former Congressman Bill Johnson, who represented East Palestine, Ohio, and played an important role with this bill.

I give special thanks to Ways and Means Committee Chairman Jason Smith for passing this bill out of the committee.

The constituents of my district and the districts each of these colleagues represents are in need of help. Today, I urge swift passage of this bill on the House floor and urge expeditious consideration in the Senate so that Americans all across America can get much-needed relief.