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A Critical Step Forward for a Stronger Economy and a Simpler, Fairer Tax Code

Today, the President signed into law a bipartisan budget agreement that bolsters our security, grows our economy, and reflects our values.

Today, the President signed into law a bipartisan budget agreement that bolsters our security, grows our economy, and reflects our values. While no deal is perfect, this agreement achieves the three key conditions set forward by the President and Congressional Democrats: undoing the harmful cuts known as sequestration, investing equally in both national security and economic growth, and avoiding ideological issues. And it permanently extends vital tax credits benefiting 24 million families a year, as well as key tax cuts for companies investing in innovation and small businesses, while putting hundreds of billions in business tax breaks on a real path to expiration.

This agreement builds on the one we secured in October to lift sequestration and allow for critical investments in areas that grow our economy, such as in education, basic research and job training, while also providing certainty and resources to our men and women in uniform. And, it’s free of ideological provisions that that would have undermined efforts to reduce carbon pollution and protect our Nation’s water supply, rolled back new rules for Wall Street that protect consumers and savers, limited women’s access to quality, affordable health care, and blocked protections for workers. 

And because it funds our government through the end of the fiscal year, the agreement gives our military and every agency in the Federal government the fiscal certainty they need to defend our nation and serve the American people.

Here are ten key areas the agreement positively impacts:

Early Learning. The agreement provides a six percent increase to Head Start, including a nearly $300 million investment to begin converting part-day, part-year Head Start programs to high-quality full school-day and year programs, which research shows promotes better outcomes for children.  It protects Preschool Development Grants, preserving funding for communities seeking to create or expand high-quality preschool opportunities for low- and moderate-income children.

Healthcare. The agreement continues support for the Affordable Care Act, preventing attempts to turn back progress by taking away health coverage from millions of Americans. It also preserves Title X funding for programs that provide needed access to preventative and reproductive health services for five million low-income women each year, despite efforts to eliminate it.

Research and Development.   The National Institutes of Health (NIH) will be able to continue research on vital scientific projects and fund new research grants that continue progress on the prevention of debilitating chronic conditions and diseases that affect millions of Americans.  The agreement includes specific increases for Alzheimer’s disease research, brain research, antibiotic research, and the Precision Medicine Initiative and funds thousands of new National Science Foundation (NSF) research grants.  This funding for critical scientific research supports the work of thousands of scientists and students and will help maintain the nation’s leadership in innovation.  The agreement also makes the Research and Experimentation tax credit permanent, bringing certainty to companies investing in innovation.

Safety and Security.  The budget agreement provides funding to support ongoing operations in Afghanistan, Syria, Iraq and around the world.  In addition, the agreement allows the Federal Bureau of Investigations (FBI) to significantly expand its cyber investigative capabilities and better use intelligence community information technology and sharing tools to combat cyber threats. In addition, new resources for the Department of State and the United States Agency for International Development (USAID) through the budget deal allow us to invest in the diplomatic and strategic partnerships needed to work with the global community to counter groups like ISIL.

Protecting the Environment. Critical to continuing the momentum of the historic climate agreement in Paris, the agreement protects EPA funding, providing the support needed to effectively implement the Clean Power Plan, a historic step in reducing carbon pollution. It also secures the biggest investment in the deployment of renewable energy in our nation’s history, specifically for solar and wind energy – extending tax credits for five years and bringing much-needed certainty to the industry.

Supporting Working Families. The deal permanently extends Recovery Act expansions of the Child Tax Credit and Earned Income Tax Credit that were scheduled to expire after 2017, which will provide a tax cut of about $900 on average for 16 million working families a year. If the expansions had been allowed to expire, more than 16 million people – including 8 million children – would have fallen into, or deeper into, poverty in 2018.

College Affordability. The agreement makes permanent the American Opportunity Tax Credit, providing a tax cut of up to $10,000 over four years for nearly 10 million families paying for college.

Job Training. The agreement invests $90 million to expand apprenticeships, creating more opportunities for hard-working Americans to acquire the skills they need to succeed in good jobs that are available now.

Infrastructure. The agreement secures $500 million in new TIGER grants to repair existing infrastructure, connect people to new jobs and opportunities, and contribute to our nation’s economic growth. 

Disrupting Business As Usual. The agreement puts a real expiration date on dozens of business tax breaks that have been extended repeatedly for years without much scrutiny.  Most importantly, it phases out bonus depreciation, which was intended to be a temporary incentive, saving over $200 billion over the next decade relative to its indefinite continuation.