Let’s Get Political: A Look at HVACR and the Midterm Elections

Posted on:

October 11, 2022

There’s a lot at stake for the HVACR industry from midterm elections – both in Congress and in statehouses across the country.

ACCA on the National Front

The 2022 midterms are crucial as we look to elect all members of the US House, 35 US Senators, and 36 Governors across the country. There are also 88 of the country’s 99 state legislative chambers holding their regularly scheduled elections. This represents 6,166 of the country’s 7,383 state legislative seats.

On the federal level, predictions are high that at least the House will be flipped, and it’s a toss-up about how those 35 Senate races will shake out, says Barton James, the association’s president and CEO. A change in the majority rule within Congress could mitigate the Administration’s agenda overreach regardless of the majority. Whatever happens, ACCA is focused on policy development to ensure a bipartisan, pro-small business focus. ACCA is working hard on behalf of its members, both for future bills and legislation that has recently been passed. In particular, the Inflation Reduction Act (IRA), which now needs to be implemented by the respective federal regulatory agencies, James says.

One of the largest legislative packages that’s been moved in years, the IRA is all-encompassing, including many aspects related to reducing climate change and electrification, he says.

“ACCA opposed the overall legislation because the costs will likely burden small businesses and their employees, and also because there’s a re-emphasis on prevailing wages that already have been codified that could disadvantage non-union HVACR contractors,” James says. “However, there are some aspects of the legislation that are actually really exciting for the HVACR industry. The incentives to transition from fossil fuels to electric, if paired with a focus on proper installation, service, and maintenance could be a real boost for HVACR contractors. As more ACCA members ease into solar it’s exciting to see the additional incentives that were included.”

“It is important to celebrate the HVACR victories. Getting these sorts of provisions into the legislation has been building a case and leveraging the current political climate. Sadly, that comes with tradeoffs. Washington is truly a game of give and take, and as long as we are effective at working on both sides of the aisle, we can still have meaningful wins even in pieces of legislation that are not fully supported. We must remember this: each time the pendulum swings, we end up with extremes as we have now,” he says. “The legislation is heavily focused on climate change, and there are questions about the timeline of how the implementation or “rulemaking” will happen, and how HVACR contractors will be impacted. It is hard not to forget about the real-world challenges with the electric grid – if we’re adding more to the load, will the grid be able to handle it?”

“As the implementation of subsequent regulations pertaining to the new law will likely be fast-tracked by the agencies under the Biden Administration, ACCA will work to make sure the regulatory agencies focus on meaningful impacts for HVACR contractors, and not overlook the need to focus on installation, service, and maintenance and not just on the equipment,” James says. “Our job is to fight for our members to make sure their needs and concerns are heard,” he says.

IRA HVAC highlights include long-term extension and expansion of the renamed Energy Efficient Home Improvement Credit (25C) tax incentive, which is extended for 10 years, limited to 30 percent of the cost of qualified products or equipment, and as a general rule is limited to $1,200 annually. Certain energy property types, such as central air conditioners and natural gas, propane or oil water heaters, furnaces, or hot water boilers, are limited to a maximum credit of $600. Other product types, such as electric and natural gas heat pumps, and identified biomass stoves are limited to $2,000. The new provision provides credit for certain electric panel board replacements or enhancements and allows up to $150 for energy audits. In addition, the legislation includes an electric appliances rebate program for low- and moderate-income customers and provides $500 million in Defense Production Act funding for heat pumps and tax credits for thermal energy storage.

An ACCA summary of relevant provisions in the IRA can be found at acca.org.

The leaders of two Allied Contracting Organizations give a taste of what’s happening on the state level regarding the midterm elections, and how the results could impact HVACR contractors within their respective states.

Georgia

“Of course, any election is important and has great implications for what we do on the advocacy side,” says Tucker Green, executive director for the Conditioned Air Association of Georgia. “Candidates have views on issues that can impact our members. They may not be HVACR-specific, but many of the policy ideas ultimately can make it more difficult for our members to do business or they can make it easier for them to operate. Elections certainly have consequences.”

In the Peach State, politics has been changing for the last 20 years and there’s starting to be a divide, both on the federal and state levels, he says. That makes elections even more critical, as sometimes there are tight races, and the state Legislature and Congressional seats can flip back and forth.

“Every time that happens, there’s an impact on our mission and what we do – both good and bad,” Green says. “Government relations is a relationship business. It takes time to invest and build relationships, and that itself has a huge impact on us when things flip.”

This year there are more than 40 members in the Georgia Legislature who are leaving, either due to retirement, redistricting or they’re seeking higher office – or they’re getting beat in the primaries, he says.

“That’s a pretty large change, and that means that we have to build a lot of new relationships,” Green says. “We try to stay in tune with decision makers, making sure they know our perspective – that’s crucial.”

In addition, every statewide office is on the ballot including the Secretary of State, which is uniquely important to the HVACR industry because the position also oversees professional licensing in the state, both residential and commercial – and the ACO’s members are very supportive of being professionally licensed, he says.

“The Governor’s race is also crucial,” Green says. “We’re one of the top states to do business – things are booming here, and government policies from the top down have an impact. More jobs and more economic development mean more work opportunities for our members.”

Green also serves as the in-house lobbyist on the state level, as well as on the local cities and countries levels. He views government relations as a crucial part of the ACO – “really being the eyes and ears for contractors.”

“They are really dedicating themselves to their business and they usually do not have the time to monitor and keep up with regulatory laws and changes in statutes and codes – although all of those things impact their business every day,” he says. That’s why it’s so crucial for the ACO to be a watchdog for things that are going to impact their business, both positively and negatively, Green says.

“There’s a saying in Georgia politics – you’re either at the table or on the table,” he says. “We advocate on our members’ behalf, to make sure they are at the table.”

Ohio

“When it comes to the elections or anything legislative, it’s always imperative for our members to get involved, be educated, and get out and vote, whether for or against issues or candidates running for office,” says Rocco Fana, executive director for the Air Conditioning Contractors of Ohio.

The ACO does not typically endorse candidates, but its leadership does meet with candidates to discuss issues important to the HVACR industry, Fana says. The ACO then helps members to educate themselves about candidates to determine whose political stances might be hazardous to their business.

“The cost of materials and supply chain problems continue to be significant issues to our members,” Fana says. “Getting materials for repair and service work, or to restock inventories is particularly challenging. Schedules are several months out waiting for materials to come in.”

In Ohio, all 99 house seats are up for reelection as well as 17 senate seats, he says. The Legislature has been dealing with gerrymandering issues, making new maps, and “causing a lot of confusion and heartburn in the state.”

“The state Legislature has been dominated by Republicans for the last several years, so there is a lot less legislative action,” Fana says. “The attitude is to stay out of the way of small businesses and let them be as successful as they can be without new taxes or burdensome regulations. It can be hard to explain to members that there’s not a lot happening, at least not business-related.”

One thing that the ACO’s members have been working on is trying to pass a residential contractor licensing bill and educating state lawmakers about the importance of residential contractor licensing, he says. They share their stories about things that have gone wrong from an unlicensed repair or install, to make it clear why residential contractors need to be licensed.

“It’s an ongoing issue that we’ve been fighting for a long time. Our members get frustrated when they don’t see any action,” Fana says. “In their business, they must fix problems immediately, but that doesn’t always happen at the state house and our members have a hard time wrapping their heads around that.”

The ACO’s leadership continues to remind members of the importance of getting to know their Congressional delegation and their state legislators and build a relationship with them on a first-name basis, he says.

“There will be times they will need to be educated by someone in our industry or someone who is a small businessperson, and our members can be that go-to person for them,” Fana says. “Our members know the issues and have answers to problems, and they should make it that elected officials will lean on them and call them if an issue pops up.”

For more voting information, visit www.acca.org/advocacy/voting.

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Katie Kuehner-Hebert

Katie Kuehner-Hebert is a freelance writer who writes for IE3. She has more than two decades of experience writing about corporate, financial and industry-specific issues. She is based in Running Springs, CA.

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