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Bill
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Affordable American-made Automobile Act

H.R. 5393 · 116th Congress · Dec 11, 2019 · Lineage

A BILL

To amend the Internal Revenue Code of 1986 to revise the incentives for electric vehicles, and for other purposes.

Section 1 Short title; findings

(a)
Short title— This Act may be cited as the “Affordable American-made Automobile Act”.
(b)
Findings— Congress finds the following:
(1)
The automobile industry is vital to the national economy and to national security. It employs millions of Americans and develops new technologies with widespread civilian and military application.
(2)
The global automobile industry is already in the midst of an historic transformation to electric vehicle technology. This transition has profound implications for all Americans.
(3)
In critical measures of the global competition in the electric vehicle industry, the United States is behind China and is projected to fall further behind. The United States is behind in total vehicle sales, behind in the market share of new car sales, behind in investment, behind in battery manufacturing capacity, and behind in manufacturing capacity. The United States lags China to a great extent, but the United States is in third place in this competition, behind the European Union.
(4)
China sells half the electric vehicles sold in the world. In addition, China’s percent of new car market share of electric vehicles is twice that of the United States. In a few short years, the Chinese new market share of electric vehicles is expected to be triple the new market share in the United States.
(5)
China is predicted to control about 75 percent of the global battery capacity.
(6)
Global investment in electric vehicles is expected to reach $300 billion or even more; half of which is intended for China and only 10 percent for the United States.
(7)
There are 17 Chinese automobile manufacturers that have announced or undertaken electric vehicle investment. Even assuming some consolidation of the Chinese industry, it will dwarf the number of manufacturers headquartered in the United States which is currently 4.
(8)
China supports its electric vehicle industry through a wide array of practices including state-owned enterprises, direct subsidies, special access to financing, government guarantees of financing, exemptions from various regulatory requirements, public purchasing, favoritism for Chinese firms, restrictions on market entry to foreign competition, and regulatory mandates.
(9)
Chinese domination of the electric vehicle industry will inevitably erode United States automobile manufacturing and the United States supply chain potentially resulting in the loss of hundreds of thousands of jobs. Employment in the innovation and research side of the industry has already begun a migration outside the United States.
(10)
United States communities are also currently suffering from extreme events of flood, wind, and fire, as well as health-threatening air pollution, all of which are related to a warming planet. Electric vehicles will play a critical role in reducing the pollution that contributes to these tragedies.
(11)
Without changes to public policy, the automotive industry in the United States will face aggressive competition from foreign companies, chiefly located in China, and will fight a competitive battle on grossly unequal terms due to foreign government policies that unfairly favor overseas manufacturers.
(12)
Such an unfair fight is unwinnable by private industry alone and is therefore a national priority for the Government of the United States to enter on behalf of every current and future American.
(13)
The United States faces a moment of critical choice. It either makes the investments necessary to achieve global competitive leadership in this key industry, or it will face profound and dire consequences to its economy and its national security.
(14)
The United States needs to stimulate demand for electric vehicles from middle class consumers. Tax incentives for the development of convenient fast charging infrastructure are essential. Investment is needed to support increased electric vehicle and battery manufacturing capacity.

Sec. 2 Expansion of tax credit for electric drive motor vehicles

(a)
Application to new and used battery electric motor vehicles—
(1)
In general— Section 30D(a) of the Internal Revenue Code of 1986 is amended by striking “new qualified plug-in electric drive motor vehicle” and inserting “credit eligible electric motor vehicle”.
(2)
Per vehicle dollar limitation— Section 30D(b) of such Code is amended—
(A)
in paragraph (1)—
(i)
by striking “paragraphs (2) and (3)” and inserting “paragraphs (4) and (5)”; and
(ii)
by striking “In general” in the heading and inserting “New qualified plug-in electric drive motor vehicles”;
(B)
by redesignating paragraphs (2) and (3) as paragraphs (4) and (5), respectively, and inserting after paragraph (1) the following new paragraphs:

“(2) New battery electric motor vehicles

“(A) In general—The amount determined under this subsection with respect to any new battery electric motor vehicle is—

“(i) $12,000 ($15,000 in the case of new battery electric motor vehicles acquired after December 31, 2018, and before the date which is 5 years after the date of the enactment of the Affordable American-made Automobile Act) if the price of such vehicle is not more than $35,000, and

“(ii) $7,500 if the price of such vehicle is greater than $35,000.

“(B) Determination of price—For purposes of this paragraph, the term “price” means—

“(i) except as provided in clause (ii), the final sales price agreed upon by the taxpayer and the person from whom the taxpayer acquires such vehicle (determined without regard to any taxes or fees imposed by any State or local government), and

“(ii) in the case of a lease, the price of the vehicle stated in the lease agreement between the lessor and lessee (as so determined).

“(3) Used battery electric motor vehicles—The amount determined under this subsection with respect to any used battery electric motor vehicle is—

“(A) $5,000 if the taxpayer trades in a vehicle that is powered by an internal combustion engine in connection with the taxpayer’s acquisition of such used battery electric motor vehicle, and

“(B) $0 in any other case.”

(C)
in paragraph (5) (as so redesignated), by striking “a vehicle” and inserting “a new qualified plug-in electric drive motor vehicle”.
(3)
Credit eligible electric motor vehicle— Section 30D(d) of such Code is amended—
(A)
by redesignating paragraphs (2), (3), and (4) as paragraphs (5), (6), and (7), respectively;
(B)
by redesignating paragraph (1) as paragraph (2);
(C)
in paragraph (2) (as so redesignated)—
(i)
in subparagraph (F), by inserting “utilizes an internal combustion engine and” before “is propelled”; and
(ii)
by striking “In general” in the heading and inserting “New qualified plug-in electric drive motor vehicle”;
(D)
by striking all that precedes paragraph (2) (as so redesignated) and inserting the following:

“(d) Credit eligible motor vehicle—For purposes of this section—

“(1) Credit eligible motor vehicle—The term “credit eligible motor vehicle” means—

“(A) a new qualified plug-in electric drive motor vehicle,

“(B) a new battery electric motor vehicle, and

“(C) a used battery electric motor vehicle.”

(E)
by inserting after paragraph (2) (as so redesignated) the following new paragraphs:

“(3) New battery electric motor vehicle—The term “new battery electric motor vehicle” means a motor vehicle—

“(A) which meets the requirements of subparagraphs (A) through (E) of paragraph (2),

“(B) which is powered by a battery electric drive train,

“(C) which produces zero exhaust emissions of any criteria pollutant (including any precursor pollutant) or greenhouse gas (other than emissions from air conditioning systems) under any possible operational modes or conditions,

“(D) the battery cell, battery pack, battery cooling system, and battery management system of which are all manufactured in the United States, and

“(E) the assembly of which is in the United States.

“(4) Used battery electric motor vehicle

“(A) In general—The term “used battery electric motor vehicle” means a motor vehicle—

“(i) the original use of which commences with a person other than the taxpayer,

“(ii) which meets the requirements of subparagraphs (B) through (E) of paragraph (2), and

“(iii) which meets the requirements of subparagraphs (B) through (E) of paragraph (3).

“(B) Only 1 credit per vehicle—No credit shall be allowed under this section with respect to any used battery electric motor vehicle placed in service by the taxpayer if a credit is allowable under this section by reason of such vehicle being placed in service at any time prior to the time that such vehicle is placed in service by the taxpayer (other than a credit which is so allowable by reason of such vehicle being a new battery electric motor vehicle).”

(b)
Carryover of personal credit— Section 30D(c)(2) of such Code is amended—
(1)
by striking “For purposes” and inserting the following:

“(A) In general—For purposes”

(2)
by adding at the end the following new subparagraph:

“(B) Carryback and carryforward of unused credits

“(i) In general—If the credit described in subparagraph (A) exceeds the limitation imposed by section 26(a) for the taxable year reduced by the sum of the credits allowable under subpart A (determined without regard to the credit described in subparagraph (A)), such excess shall be—

“(I) carried back to the taxable year preceding the taxable year in which such amount arose, and

“(II) carried forward to the 5 taxable years following the taxable year in which such amount arose.

“(ii) Limitation—For purposes of clause (i), the amount of credit carried back or forward under such clause—

“(I) shall be taken into account as a credit described in subparagraph (A) for the taxable year to which carried (except, in the case of a carryback, such amount shall not be taken into account for purposes of applying clause (i) to such taxable year), and

“(II) such amounts shall be treated as used on a first-in, first-out basis, determined on the basis of the taxable year in which such amount arose.”

(c)
Assignment of credit to financing entity— Section 30D(f) of such Code is amended by adding at the end the following new paragraph:

“(8) Credit may be assigned to financing entity

“(A) In general—In the case of a credit determined under subsection (a) with respect to a new qualified plug-in electric drive motor vehicle or a new battery electric motor vehicle, the taxpayer to whom such credit would (but for this paragraph) be allowed under subsection (a) for any taxable year may assign such credit to the person who financed the purchase (or lease of at least 2 years) of such vehicle. Any person to whom such credit is assigned under the preceding sentence shall be treated for purposes of this title as the taxpayer who placed such vehicle in service.

“(B) Disclosure requirement—Subparagraph (A) shall not apply with respect to any vehicle unless the person to whom the credit is assigned clearly discloses in writing to the taxpayer the amount of the credit allowable under subsection (a) with respect to such vehicle (determined without regard to subsection (c)).”

(d)
Modification of termination of credit—
(1)
Repeal of manufacturers limitation— Section 30D of such Code is amended by striking subsection (e).
(2)
Termination of credit— Section 30D of such Code is amended by adding at the end the following new subsection:

“(h) Termination—This section shall not apply to any vehicle placed in service after December 31, 2030.”

(e)
Effective dates—
(1)
In general— Except as otherwise provided in this subsection, the amendments made by this section shall apply to vehicles acquired after December 31, 2018.
(2)
Carryforward— The amendments made by subsection (b) shall apply to vehicles acquired after the date of the enactment of this Act.
(3)
Assignment— The amendment made by subsection (c) shall apply to vehicles acquired after the date which is 60 days after the date of the enactment of this Act.

Sec. 3 Alternative fuel vehicle refueling property credit extended for electric vehicle charging stations

(a)
Extension— Section 30C(g) of the Internal Revenue Code of 1986 is amended by striking “December 31, 2017” and inserting “December 31, 2030”.
(b)
Repeal of limitation— Section 30C of such Code is amended by striking subsection (b).
(c)
Application to electric vehicle charging stations—
(1)
In general— Section 30C(a) of such Code is amended by striking “qualified alternative fuel vehicle refueling property” and inserting “electric vehicle charging station”.
(2)
Electric vehicle charging station defined— Section 30C(c) of such Code is amended to read as follows:

“(c) Electric vehicle charging station—For purposes of this section, the term “electric vehicle charging station” means a station designed for recharging an electric battery of a credit eligible motor vehicle (as defined in section 30D(d), but determined without regard to the requirements of subparagraphs (D) and (E) of paragraph (3) thereof).”

(d)
Conforming amendments—
(1)
Section 30C(e)(2) of such Code is amended by striking “qualified alternative fuel vehicle refueling property” and inserting “electric vehicle charging station”.
(2)
Section 30C(e) of such Code is amended by striking paragraph (6) and redesignating paragraph (7) as paragraph (6).
(3)
Section 38(b)(25) of such Code is amended by striking “alternative fuel vehicle refueling property credit” and inserting “electric vehicle charging station credit”.
(4)
The heading of section 30C of such Code (and the item relating to such section in the table of sections for subpart B of part IV of subchapter A of chapter 1 of such Code) is amended by striking “Alternative fuel vehicle refueling property” and inserting “Electric vehicle recharging station”.
(e)
Effective date— The amendments made by this section shall apply to property placed in service after December 31, 2018.

Sec. 4 Private activity bonds related to electric vehicle manufacturing

(a)
In general— Section 142(a) of the Internal Revenue Code of 1986 is amended by striking “or” at the end of paragraph (14), by striking the period at the end of paragraph (15) and inserting “, or”, and by adding at the end the following new paragraph:

“(16) a qualified battery electric motor vehicle manufacturing facility or a qualified electric vehicle battery manufacturing facility.”

(b)
Facilities defined— Section 142 of such Code is amended by adding at the end the following new subsection:

“(n) Qualified battery electric motor vehicle manufacturing and qualified electric vehicle battery manufacturing facilities

“(1) In general—For purposes of subsection (a)(16)—

“(A) the term “qualified battery electric motor vehicle manufacturing facility” means a battery electric motor vehicle manufacturing facility designated by the Secretary under this subsection, and

“(B) the term “qualified electric vehicle battery manufacturing facility” means an electric vehicle battery manufacturing facility designated by the Secretary under this subsection.

“(2) Battery electric motor vehicle manufacturing facility—For purposes of this subsection—

“(A) In general—The term “battery electric motor vehicle manufacturing facility” means a facility for manufacturing battery electric motor vehicles.

“(B) Battery electric motor vehicles—The term “battery electric motor vehicle” means an automobile which is powered by a battery electric drive train and which produces zero exhaust emissions of any criteria pollutant (including any precursor pollutant) or greenhouse gas (other than emissions from air conditioning systems) under any possible operational modes or conditions.

“(3) Electric vehicle battery manufacturing facility—The term “electric vehicle battery manufacturing facility” means a facility for manufacturing batteries for use in battery electric motor vehicles.

“(4) Aggregate limitation on designations

“(A) In general—An issue shall not be treated as an issue described in subsection (a)(16) if the aggregate face amount of bonds issued by the State or local government pursuant thereto for any facility (when added to the aggregate face amount of bonds previously so issued for such facility) exceeds the amount allocated to such facility by the Secretary under this subsection.

“(B) Aggregate limitation—The Secretary many not allocate more than $15,000,000,000 to facilities designated under this subsection.

“(5) Standards for designation—The Secretary shall not designate a facility for purposes of this subsection unless—

“(A) an application has been submitted to the Secretary with respect to such facility which meets the requirements of paragraph (7),

“(B) such facility is located in the United States,

“(C) such facility has been nominated by a State or local government during the 180-day period ending with the date of such application, and

“(D) such State or local government provides written assurances of the accuracy of the application with respect to such facility.

“(6) Priority for retooling of existing facilities—The Secretary shall give priority in making designations and allocations under this subsection to the retooling of existing manufacturing facilities, especially the oldest facilities or facilities that have been in existence for at least 20 years (whether or not such facilities are idle).

“(7) Conditional designations—The Secretary may approve a designation under this subsection subject to such conditions as the Secretary may determine are necessary to satisfy the purposes of this subsection or to protect the national security interests of the United States.

“(8) Application—An application with respect to a facility for designation under this subsection shall include—

“(A) a written agreement that—

“(i) all laborers and mechanics employed by contractors or subcontractors during construction, alteration, or repair that is financed, in whole or in part, by the proceeds of the issue shall be paid wages at rates not less than those prevailing on similar construction in the locality, as determined by the Secretary of Labor in accordance with sections 3141–3144, 3146, and 3147 of title 40, United States Code, and

“(ii) the Secretary of Labor shall, with respect to the labor standards described in clause (i), have the authority and functions set forth in Reorganization Plan Numbered 14 of 1950 (5 U.S.C. App.) and section 3145 of title 40, United States Code,

“(B) evidence satisfactory to the Secretary that the project will improve the global competitive position of the United States in the electric vehicle industry, will stimulate the regional economy at the facility location, and will provide quality jobs and labor standards consistent with the United States automobile industry, and

“(C) a demonstration that the facility includes the use of energy efficiency, renewable energy, and other sustainable design features to the extent feasible.

“(9) Time limit on expenditure of bond proceeds—An issue shall not be treated as an issue described in subsection (a)(16) unless at least 95 percent of the net proceeds of the issue are expended for the facility designated under this subsection within the 5-year period beginning on the date of issuance. If at least 95 percent of such net proceeds is not so expended within such 5-year period, an issue shall be treated as continuing to be described in subsection (a)(16) if the issuer uses all remaining proceeds of the issue to redeem bonds of the issue within 90 days after the end of such 5-year period. The Secretary, at the request of the issuer, may extend such 5-year period if the issuer establishes that the failure to make such expenditures is due to circumstances beyond the control of the issuer.”

(c)
Effective date— The amendments made by this section shall apply to bonds issued after the date of the enactment of this Act.