39–006 

113TH CONGRESS REPORT " ! HOUSE OF REPRESENTATIVES 2d Session 113–494 

CONSERVATION EASEMENT INCENTIVE ACT OF 2014 

JUNE 26, 2014.—Committed to the Committee of the Whole House on the State of 

the Union and ordered to be printed 

Mr. CAMP, from the Committee on Ways and Means, 

submitted the following 

R E P O R T 

together with 

DISSENTING VIEWS 

[To accompany H.R. 2807] 

[Including cost estimate of the Congressional Budget Office] 

The Committee on Ways and Means, to whom was referred the 

bill (H.R. 2807) to amend the Internal Revenue Code of 1986 to 

make permanent the special rule for contributions of qualified conservation contributions, having considered the same, report favorably thereon with an amendment and recommend that the bill as 

amended do pass. 

CONTENTS 

Page 

I. SUMMARY AND BACKGROUND ............................................................... 2 

A. Purpose and Summary ..................................................................... 2 

B. Background and Need for Legislation ............................................. 2 

C. Legislative History ............................................................................ 3 

II. EXPLANATION OF THE BILL ................................................................... 3 

A. Special Rule for Qualified Conservation Contributions Made 

Permanent (sec. 170(b) of the Code) ............................................. 3 

III. VOTES OF THE COMMITTEE .................................................................... 6 

IV. BUDGET EFFECTS OF THE BILL ............................................................ 8 

A. Committee Estimate of Budgetary Effects ...................................... 8 

B. Statement Regarding New Budget Authority and Tax Expenditures Budget Authority .................................................................. 9 

C. Cost Estimate Prepared by the Congressional Budget Office ....... 9 

D. Macroeconomic Impact Analysis ...................................................... 10 

V. OTHER MATTERS TO BE DISCUSSED UNDER THE RULES OF 

THE HOUSE .............................................................................................. 10 


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A. Committee Oversight Findings and Recommendations ................. 10 

B. Statement of General Performance Goals and Objectives ............. 10 

C. Information Relating to Unfunded Mandates ................................ 10 

D. Applicability of House Rule XXI 5(b) .............................................. 11 

E. Tax Complexity Analysis .................................................................. 11 

F. Congressional Earmarks, Limited Tax Benefits, and Limited 

Tariff Benefits ................................................................................. 11 

G. Duplication of Federal Programs ..................................................... 11 

H. Disclosure of Directed Rule Makings .............................................. 12 

VI. CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED 12 

VII. DISSENTING VIEWS ................................................................................... 14 

The amendment is as follows: 

Strike all after the enacting clause and insert the following: 

SECTION 1. SHORT TITLE. 

This Act may be cited as the ‘‘Conservation Easement Incentive Act of 2014’’. 

SEC. 2. SPECIAL RULE FOR CONTRIBUTIONS OF QUALIFIED CONSERVATION CONTRIBUTIONS 

MADE PERMANENT. 

(a) IN GENERAL.— 

(1) INDIVIDUALS.—Subparagraph (E) of section 170(b)(1) of the Internal Revenue Code of 1986 is amended by striking clause (vi). 

(2) CORPORATIONS.—Subparagraph (B) of section 170(b)(2) of such Code is 

amended by striking clause (iii). 

(b) EFFECTIVE DATE.—The amendments made by this section shall apply to contributions made in taxable years beginning after December 31, 2013. 

I. SUMMARY AND BACKGROUND 

A. PURPOSE AND SUMMARY

Similar to a provision contained in the discussion draft of the 

‘‘Tax Reform Act of 2014’’ released on February 26, 2014, the bill, 

H.R. 2807, reported by the Committee on Ways and Means, provides that individuals may deduct the fair market value of qualified conservation contributions up to 50 percent of the individual’s 

adjusted gross income (AGI). H.R. 2807 provides that farmers and 

ranchers may deduct the fair market value of qualified conservation contributions up to 100 percent of AGI (or 100 percent of taxable income in the case of a corporate farmer or rancher), provided 

the property used in agricultural or livestock production remains 

available for such production. An identical, temporary provision expired for taxable years beginning after December 31, 2013. 

B. BACKGROUND AND NEED FOR LEGISLATION

While the Committee continues actively to pursue comprehensive 

tax reform as a critical means of promoting economic growth and 

job creation, the Committee also believes that it is important to 

provide individuals and small businesses permanent, immediate 

tax relief to encourage faster economic growth and job creation, 

while fostering charitable giving. By reinstating and making permanent the increased deduction limits for qualified conservation 

contributions, H.R. 2807 restores an important incentive for contributions of conservation easements that benefit the nation’s communities and the environment. The deduction for qualified conservation contributions was intended to spur new donations of conservation easements. According to testimony received by the Committee, in the first two years following its original enactment, the 

temporary rule doubled the number of conservation easement donaVerDate Mar 15 2010 05:31 Jul 01, 2014 Jkt 039006 PO 00000 Frm 00002 Fmt 6659 Sfmt 6602 E:\HR\OC\HR494.XXX HR494

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1Secs. 170, 2055, and 2522, respectively. 

tions in comparison to the two prior years, and increased the acreage conserved by about 32 percent. H.R. 2807, which is similar to 

a provision contained in the February 26, 2014, discussion draft of 

the ‘‘Tax Reform Act of 2014,’’ will continue these results by providing certainty and stability to individuals and businesses seeking 

to contribute conservation easements. 

C. LEGISLATIVE HISTORY

Background 

H.R. 2807 was introduced on July 24, 2013, and was referred to 

the Committee on Ways and Means. 

Committee action 

The Committee on Ways and Means marked up H.R. 2807, the 

Conservation Easement Incentive Act of 2014, on May 29, 2014, 

and ordered the bill, as amended, favorably reported (with a 

quorum being present). 

The need for permanent rules regarding qualified conservation 

contributions was discussed at no fewer than three hearings during 

the 112th and 113th Congresses: • Select Revenue Measures Subcommittee Hearing on Certain Expiring Tax Provisions (April 26, 2012); • Select Revenue Measures Subcommittee Hearing on 

Framework for Evaluating Certain Expiring Tax Provisions (June 8, 2012); and • Full Committee Hearing on Tax Reform and Charitable 

Contributions (February 14, 2013). 

II. EXPLANATION OF THE BILL 

A. SPECIAL RULE FOR QUALIFIED CONSERVATION CONTRIBUTIONS

MADE PERMANENT (SEC. 170(b) OF THE CODE) 

PRESENT LAW

Charitable contributions generally 

In general, a deduction is permitted for charitable contributions, 

subject to certain limitations that depend on the type of taxpayer, 

the property contributed, and the donee organization. The amount 

of deduction generally equals the fair market value of the contributed property on the date of the contribution. Charitable deductions are provided for income, estate, and gift tax purposes.1

In general, in any taxable year, charitable contributions by a corporation are not deductible to the extent the aggregate contributions exceed ten percent of the corporation’s taxable income computed without regard to net operating or capital loss carrybacks. 

Total deductible contributions of an individual taxpayer to public 

charities, private operating foundations, and certain types of private nonoperating foundations generally may not exceed 50 percent 

of the taxpayer’s contribution base, which is the taxpayer’s adjusted gross income for a taxable year (disregarding any net operating loss carryback). To the extent a taxpayer has not exceeded 

the 50-percent limitation, (1) contributions of capital gain property 


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2Secs. 170(f)(3)(B)(iii) and 170(h). 

to public charities generally may be deducted up to 30 percent of 

the taxpayer’s contribution base, (2) contributions of cash to most 

private nonoperating foundations and certain other charitable organizations generally may be deducted up to 30 percent of the taxpayer’s contribution base, and (3) contributions of capital gain 

property to private foundations and certain other charitable organizations generally may be deducted up to 20 percent of the taxpayer’s contribution base. 

Contributions in excess of the applicable percentage limits generally may be carried over and deducted over the next five taxable 

years, subject to the relevant percentage limitations on the deduction in each of those years. 

Capital gain property 

Capital gain property means any capital asset or property used 

in the taxpayer’s trade or business the sale of which at its fair market value, at the time of contribution, would have resulted in gain 

that would have been long-term capital gain. Contributions of capital gain property to a qualified charity are deductible at fair market value within certain limitations. Contributions of capital gain 

property to charitable organizations described in section 

170(b)(1)(A) (e.g., public charities, private foundations other than 

private non-operating foundations, and certain governmental units) 

generally are deductible up to 30 percent of the taxpayer’s contribution base. An individual may elect, however, to bring all these 

contributions of capital gain property for a taxable year within the 

50-percent limitation category by reducing the amount of the contribution deduction by the amount of the appreciation in the capital 

gain property. Contributions of capital gain property to charitable 

organizations described in section 170(b)(1)(B) (e.g., private non-operating foundations) are deductible up to 20 percent of the taxpayer’s contribution base. 

For purposes of determining whether a taxpayer’s aggregate 

charitable contributions in a taxable year exceed the applicable 

percentage limitation, contributions of capital gain property are 

taken into account after other charitable contributions. 

Qualified conservation contributions 

Qualified conservation contributions are one exception to the 

‘‘partial interest’’ rule, which generally bars deductions for charitable contributions of partial interests in property.2 A qualified conservation contribution is a contribution of a qualified real property 

interest to a qualified organization exclusively for conservation purposes. A qualified real property interest is defined as: (1) the entire 

interest of the donor other than a qualified mineral interest; (2) a 

remainder interest; or (3) a restriction (granted in perpetuity) on 

the use that may be made of the real property. Qualified organizations include certain governmental units, public charities that meet 

certain public support tests, and certain supporting organizations. 

Conservation purposes include: (1) the preservation of land areas 

for outdoor recreation by, or for the education of, the general public; (2) the protection of a relatively natural habitat of fish, wildlife, 

or plants, or similar ecosystem; (3) the preservation of open space 


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3Sec. 170(b)(1)(E). 

(including farmland and forest land) where such preservation will 

yield a significant public benefit and is either for the scenic enjoyment of the general public or pursuant to a clearly delineated Federal, State, or local governmental conservation policy; and (4) the 

preservation of an historically important land area or a certified 

historic structure. 

Qualified conservation contributions of capital gain property are 

subject to the same limitations and carryover rules as other charitable contributions of capital gain property. 

Temporary rules regarding contributions of capital gain real property for conservation purposes 

In general 

Under a temporary provision 3 the 30-percent contribution base 

limitation on contributions of capital gain property by individuals 

does not apply to qualified conservation contributions (as defined 

under present law). Instead, individuals may deduct the fair market value of any qualified conservation contribution to the extent 

of the excess of 50 percent of the contribution base over the amount 

of all other allowable charitable contributions. These contributions 

are not taken into account in determining the amount of other allowable charitable contributions. 

Individuals are allowed to carry over any qualified conservation 

contributions that exceed the 50-percent limitation for up to 15 

years. 

For example, assume an individual with a contribution base of $100 makes a qualified conservation contribution of property with 

a fair market value of $80 and makes other charitable contributions subject to the 50-percent limitation of $60. The individual is 

allowed a deduction of $50 in the current taxable year for the nonconservation contributions (50 percent of the $100 contribution 

base) and is allowed to carry over the excess $10 for up to 5 years. 

No current deduction is allowed for the qualified conservation contribution, but the entire $80 qualified conservation contribution 

may be carried forward for up to 15 years. 

Farmers and ranchers 

In the case of an individual who is a qualified farmer or rancher 

for the taxable year in which the contribution is made, a qualified 

conservation contribution is allowable up to 100 percent of the excess of the taxpayer’s contribution base over the amount of all 

other allowable charitable contributions. 

In the above example, if the individual is a qualified farmer or rancher, in addition to the $50 deduction for non-conservation contributions, an additional $50 for the qualified conservation contribution is allowed and $30 may be carried forward for up to 15 

years as a contribution subject to the 100-percent limitation. 

In the case of a corporation (other than a publicly traded corporation) that is a qualified farmer or rancher for the taxable year in 

which the contribution is made, any qualified conservation contribution is allowable up to 100 percent of the excess of the corporation’s taxable income (as computed under section 170(b)(2)) 

over the amount of all other allowable charitable contributions. 


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4Sec. 170(b)(2)(B). 

5Secs. 170(b)(1)(E)(vi) and 170(b)(2)(B)(iii). 

Any excess may be carried forward for up to 15 years as a contribution subject to the 100-percent limitation.4

As an additional condition of eligibility for the 100 percent limitation, with respect to any contribution of property in agriculture 

or livestock production, or that is available for such production, by 

a qualified farmer or rancher, the qualified real property interest 

must include a restriction that the property remain generally available for such production. (There is no requirement as to any specific use in agriculture or farming, or necessarily that the property 

be used for such purposes, merely that the property remain available for such purposes.) 

A qualified farmer or rancher means a taxpayer whose gross income from the trade or business of farming (within the meaning of 

section 2032A(e)(5)) is greater than 50 percent of the taxpayer’s 

gross income for the taxable year. 

Termination 

The temporary rules regarding contributions of capital gain real 

property for conservation purposes do not apply to contributions 

made in taxable years beginning after December 31, 2013.5

REASONS FOR CHANGE

The Committee believes that the special rule that provides an increased incentive to make charitable contributions of partial interests in real property for conservation purposes is an important way 

of encouraging conservation and preservation, and therefore should 

be permanently extended. 

EXPLANATION OF PROVISION

The provision reinstates and makes permanent the increased 

percentage limits and extended carryforward period for qualified 

conservation contributions. 

EFFECTIVE DATE

The provision is effective for contributions made in taxable years 

beginning after December 31, 2013. 

III. VOTES OF THE COMMITTEE 

In compliance with clause 3(b) of rule XIII of the Rules of the 

House of Representatives, the following statements are made concerning the votes of the Committee on Ways and Means in its consideration of H.R. 2807, the Conservation Easement Incentive Act 

of 2014, on May 29, 2014. 

The vote on the motion by Mr. Brady to table Mr. Thompson’s 

motion to appeal the ruling of the Chair was agreed to by a roll 

call vote of 22 yeas to 14 nays (with a quorum being present). The 

vote was as follows: 

Representative Yea Nay Present Representative Yea Nay Present 

Mr. Camp .............................. X ........... ............. Mr. Levin .............................. ........... X .............

Mr. Johnson ........................... X ........... ............. Mr. Rangel ........................... ........... X .............

Mr. Brady .............................. X ........... ............. Mr. McDermott ..................... ........... X .............


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Representative Yea Nay Present Representative Yea Nay Present 

Mr. Ryan ............................... X ........... ............. Mr. Lewis .............................. ........... ........... .............

Mr. Nunes ............................. ........... ........... ............. Mr. Neal ............................... ........... X .............

Mr. Tiberi .............................. X ........... ............. Mr. Becerra .......................... ........... X .............

Mr. Reichert .......................... X ........... ............. Mr. Doggett .......................... ........... X .............

Mr. Boustany ......................... X ........... ............. Mr. Thompson ...................... ........... X .............

Mr. Roskam ........................... X ........... ............. Mr. Larson ............................ ........... X .............

Mr. Gerlach ........................... X ........... ............. Mr. Blumenauer ................... ........... X .............

Mr. Price ............................... X ........... ............. Mr. Kind ............................... ........... X .............

Mr. Buchanan ....................... X ........... ............. Mr. Pascrell .......................... ........... ........... .............

Mr. Smith .............................. X ........... ............. Mr. Crowley .......................... ........... X .............

Mr. Schock ............................ X ........... ............. Ms. Schwartz ........................ ........... X .............

Ms. Jenkins ........................... X ........... ............. Mr. Davis .............................. ........... X .............

Mr. Paulsen ........................... X ........... ............. Ms. Sanchez ......................... ........... X .............

Mr. Marchant ........................ X ........... .............

Ms. Black .............................. X ........... .............

Mr. Reed ............................... X ........... .............

Mr. Young ............................. X ........... .............

Mr. Kelly ................................ X ........... .............

Mr. Griffin ............................. X ........... .............

Mr. Renacci ........................... X ........... .............

The vote on the amendment by Mr. Neal to the amendment in 

the nature of a substitute, which would strike the short title and 

the provision making permanent the special rule for contributions 

of qualified conservation contributions, replacing those provisions 

with a two-year extension of that special rule, was not agreed to 

by a roll call vote of 10 yeas to 26 nays (with a quorum being 

present). The vote was as follows: 

Representative Yea Nay Present Representative Yea Nay Present 

Mr. Camp .............................. ........... X ............. Mr. Levin .............................. X ........... .............

Mr. Johnson ........................... ........... X ............. Mr. Rangel ........................... X ........... .............

Mr. Brady .............................. ........... X ............. Mr. McDermott ..................... X ........... .............

Mr. Ryan ............................... ........... X ............. Mr. Lewis .............................. ........... ........... .............

Mr. Nunes ............................. ........... ........... ............. Mr. Neal ............................... X ........... .............

Mr. Tiberi .............................. ........... X ............. Mr. Becerra .......................... ........... X .............

Mr. Reichert .......................... ........... X ............. Mr. Doggett .......................... ........... X .............

Mr. Boustany ......................... ........... X ............. Mr. Thompson ...................... ........... X .............

Mr. Roskam ........................... ........... X ............. Mr. Larson ............................ X ........... .............

Mr. Gerlach ........................... ........... X ............. Mr. Blumenauer ................... X ........... .............

Mr. Price ............................... ........... X ............. Mr. Kind ............................... ........... X .............

Mr. Buchanan ....................... ........... X ............. Mr. Pascrell .......................... ........... ........... .............

Mr. Smith .............................. ........... X ............. Mr. Crowley .......................... X ........... .............

Mr. Schock ............................ ........... X ............. Ms. Schwartz ........................ X ........... .............

Ms. Jenkins ........................... ........... X ............. Mr. Davis .............................. X ........... .............

Mr. Paulsen ........................... ........... X ............. Ms. Sanchez ......................... X ........... .............

Mr. Marchant ........................ ........... X .............

Ms. Black .............................. ........... X .............

Mr. Reed ............................... ........... X .............

Mr. Young ............................. ........... X .............

Mr. Kelly ................................ ........... X .............

Mr. Griffin ............................. ........... X .............

Mr. Renacci ........................... ........... X .............

The vote on the motion by Mr. Brady to table Mr. McDermott’s 

motion to appeal the ruling of the Chair was agreed to by a roll 

call vote of 23 yeas to 14 nays (with a quorum being present). The 

vote was as follows: 

Representative Yea Nay Present Representative Yea Nay Present 

Mr. Camp ......................... X ........... ............. Mr. Levin ................................... ........... X .............

Mr. Johnson ..................... X ........... ............. Mr. Rangel ................................. ........... X .............

Mr. Brady ......................... X ........... ............. Mr. McDermott ........................... ........... X .............


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Representative Yea Nay Present Representative Yea Nay Present 

Mr. Ryan .......................... X ........... ............. Mr. Lewis ................................... ........... ........... .............

Mr. Nunes ........................ X ........... ............. Mr. Neal ..................................... ........... X .............

Mr. Tiberi ......................... X ........... ............. Mr. Becerra ................................ ........... X .............

Mr. Reichert ..................... X ........... ............. Mr. Doggett ............................... ........... X .............

Mr. Boustany ................... X ........... ............. Mr. Thompson ............................ ........... X .............

Mr. Roskam ..................... X ........... ............. Mr. Larson ................................. ........... X .............

Mr. Gerlach ...................... X ........... ............. Mr. Blumenauer ......................... ........... X .............

Mr. Price .......................... X ........... ............. Mr. Kind ..................................... ........... X .............

Mr. Buchanan .................. X ........... ............. Mr. Pascrell ............................... ........... ........... .............

Mr. Smith ......................... X ........... ............. Mr. Crowley ................................ ........... X .............

Mr. Schock ....................... X ........... ............. Ms. Schwartz ............................. ........... X .............

Ms. Jenkins ...................... X ........... ............. Mr. Davis ................................... ........... X .............

Mr. Paulsen ..................... X ........... ............. Ms. Sanchez .............................. ........... X .............

Mr. Marchant ................... X ........... .............

Ms. Black ......................... X ........... .............

Mr. Reed .......................... X ........... .............

Mr. Young ........................ X ........... .............

Mr. Kelly ........................... X ........... .............

Mr. Griffin ........................ X ........... .............

Mr. Renacci ..................... X ........... .............

The bill, H.R. 2807, was ordered favorably reported as amended 

by a roll call vote of 23 yeas to 14 nays (with a quorum being 

present). The vote was as follows: 

Representative Yea Nay Present Representative Yea Nay Present 

Mr. Camp ......................... X ........... ............. Mr. Levin ................................... ........... X .............

Mr. Johnson ..................... X ........... ............. Mr. Rangel ................................. ........... X .............

Mr. Brady ......................... X ........... ............. Mr. McDermott ........................... ........... X .............

Mr. Ryan .......................... X ........... ............. Mr. Lewis ................................... ........... ........... .............

Mr. Nunes ........................ X ........... ............. Mr. Neal ..................................... ........... X .............

Mr. Tiberi ......................... X ........... ............. Mr. Becerra ................................ ........... X .............

Mr. Reichert ..................... X ........... ............. Mr. Doggett ............................... ........... X .............

Mr. Boustany ................... X ........... ............. Mr. Thompson ............................ ........... X .............

Mr. Roskam ..................... X ........... ............. Mr. Larson ................................. ........... X .............

Mr. Gerlach ...................... X ........... ............. Mr. Blumenauer ......................... ........... X .............

Mr. Price .......................... X ........... ............. Mr. Kind ..................................... ........... X .............

Mr. Buchanan .................. X ........... ............. Mr. Pascrell ............................... ........... ........... .............

Mr. Smith ......................... X ........... ............. Mr. Crowley ................................ ........... X .............

Mr. Schock ....................... X ........... ............. Ms. Schwartz ............................. ........... X .............

Ms. Jenkins ...................... X ........... ............. Mr. Davis ................................... ........... X .............

Mr. Paulsen ..................... X ........... ............. Ms. Sanchez .............................. ........... X .............

Mr. Marchant ................... X ........... .............

Ms. Black ......................... X ........... .............

Mr. Reed .......................... X ........... .............

Mr. Young ........................ X ........... .............

Mr. Kelly ........................... X ........... .............

Mr. Griffin ........................ X ........... .............

Mr. Renacci ..................... X ........... .............

IV. BUDGET EFFECTS OF THE BILL 

A. COMMITTEE ESTIMATE OF BUDGETARY EFFECTS

In compliance with clause 3(d) of rule XIII of the Rules of the 

House of Representatives, the following statement is made concerning the effects on the budget of the bill, H.R. 2807, as reported. 

The bill, as reported, is estimated to have the following effect on 

Federal budget receipts for fiscal years 2014–2024: 


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FISCAL YEARS 

[Millions of Dollars] 

2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2014–19 2014–24 

¥6 ¥81 ¥77 ¥81 ¥84 ¥94 ¥111 ¥127 ¥142 ¥156 ¥169 ¥422 ¥1,128 

Note: Details do not add to totals due to rounding. 

B. STATEMENT REGARDING NEW BUDGET AUTHORITY AND TAX

EXPENDITURES BUDGET AUTHORITY

In compliance with clause 3(c)(2) of rule XIII of the Rules of the 

House of Representatives, the Committee states that the bill involves no new or increased budget authority. The Committee further states that the revenue-reducing tax provisions involve increased tax expenditures. (See amounts in table in Part IV.A., 

above.) 

C. COST ESTIMATE PREPARED BY THE CONGRESSIONAL BUDGET

OFFICE

In compliance with clause 3(c)(3) of rule XIII of the Rules of the 

House of Representatives, requiring a cost estimate prepared by 

the CBO, the following statement by CBO is provided. 

U.S. CONGRESS, 

CONGRESSIONAL BUDGET OFFICE, 

Washington, DC, June 5, 2014. 

Hon. DAVE CAMP, 

Chairman, Committee on Ways and Means, 

House of Representatives, Washington, DC. 

DEAR MR. CHAIRMAN: The Congressional Budget Office has prepared the enclosed cost estimate for H.R. 2807, the Conservation 

Easement Incentive Act of 2014. 

If you wish further details on this estimate, we will be pleased 

to provide them. The CBO staff contact is Logan Timmerhoff. 

Sincerely, 

DOUGLAS W. ELMENDORF. 

Enclosure. 

H.R. 2807—Conservation Easement Incentive Act of 2014 

H.R. 2807 would amend the Internal Revenue Code to reinstate 

and make permanent specified rules that increased the amount of 

income tax deductions allowed for taxpayers making certain charitable contributions of real property for conservation purposes. The 

rules, which expired on December 31, 2013, increased certain income-based limits on the amount of such conservation contributions 

that an individual or qualified corporate farmer or rancher could 

deduct in a year, and extended the number of years over which 

such contributions above the limits could be carried forward and 

deducted. 

The staff of the Joint Committee on Taxation (JCT) estimates 

that enacting H.R. 2807 would reduce revenues, thus increasing 

federal budget deficits, by about $1.1 billion over the 2014–2024 period. 

The Statutory Pay-As-You-Go Act of 2010 establishes budget-reporting and enforcement procedures for legislation affecting direct 


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spending and revenues. Enacting H.R. 2807 would result in revenue losses in each year beginning in 2014. The estimated increases in the deficit are shown in the following table. 

JCT has determined that the bill contains no intergovernmental 

or private-sector mandates as defined in the Unfunded Mandates 

Reform Act. 

The CBO staff contact for this estimate is Logan Timmerhoff. 

The estimate was approved by David Weiner, Assistant Director for 

Tax Analysis. 

CBO ESTIMATE OF PAY-AS-YOU-GO EFFECTS FOR H.R. 2807, AS ORDERED REPORTED BY THE 

HOUSE COMMITTEE ON WAYS AND MEANS ON MAY 29, 2014 

By fiscal year, in millions of dollars— 

2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2014– 

2019 

2014– 

2024 

NET INCREASE IN THE DEFICIT 

Statutory Pay-As-You-Go Effects 6 81 77 81 84 94 111 127 142 156 169 422 1,128 

Source: Staff of the Joint Committee on Taxation. 

Note: Components may not sum to totals because of rounding. 

D. MACROECONOMIC IMPACT ANALYSIS

In compliance with clause 3(h)(2) of rule XIII of the Rules of the 

House of Representatives, the following statement is made by the 

Joint Committee on Taxation with respect to the provisions of the 

bill amending the Internal Revenue Code of 1986: the effects of the 

bill on economic activity are so small as to be incalculable within 

the context of a model of the aggregate economy. 

V. OTHER MATTERS TO BE DISCUSSED UNDER THE 

RULES OF THE HOUSE 

A. COMMITTEE OVERSIGHT FINDINGS AND RECOMMENDATIONS

With respect to clause 3(c)(1) of rule XIII of the Rules of the 

House of Representatives (relating to oversight findings), the Committee advises that it was as a result of the Committee’s review of 

the provisions of H.R. 2807 that the Committee concluded that it 

is appropriate to report the bill, as amended, favorably to the 

House of Representatives with the recommendation that the bill do 

pass. 

B. STATEMENT OF GENERAL PERFORMANCE GOALS AND OBJECTIVES

With respect to clause 3(c)(4) of rule XIII of the Rules of the 

House of Representatives, the Committee advises that the bill contains no measure that authorizes funding, so no statement of general performance goals and objectives for which any measure authorizes funding is required. 

C. INFORMATION RELATING TO UNFUNDED MANDATES

This information is provided in accordance with section 423 of 

the Unfunded Mandates Reform Act of 1995 (Pub. L. No. 104–4). 

The Committee has determined that the bill does not contain 

Federal mandates on the private sector. The Committee has deterVerDate Mar 15 2010 05:18 Jul 01, 2014 Jkt 039006 PO 00000 Frm 00010 Fmt 6659 Sfmt 6602 E:\HR\OC\HR494.XXX HR494

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mined that the bill does not impose a Federal intergovernmental 

mandate on State, local, or tribal governments. 

D. APPLICABILITY OF HOUSE RULE XXI 5(b) 

Rule XXI 5(b) of the Rules of the House of Representatives provides, in part, that ‘‘A bill or joint resolution, amendment, or conference report carrying a Federal income tax rate increase may not 

be considered as passed or agreed to unless so determined by a 

vote of not less than three-fifths of the Members voting, a quorum 

being present.’’ The Committee has carefully reviewed the bill, and 

states that the bill does not involve any Federal income tax rate 

increases within the meaning of the rule. 

E. TAX COMPLEXITY ANALYSIS

Section 4022(b) of the Internal Revenue Service Restructuring 

and Reform Act of 1998 (the ‘‘IRS Reform Act’’) requires the staff 

of the Joint Committee on Taxation (in consultation with the Internal Revenue Service and the Treasury Department) to provide a 

tax complexity analysis. The complexity analysis is required for all 

legislation reported by the Senate Committee on Finance, the 

House Committee on Ways and Means, or any committee of conference if the legislation includes a provision that directly or indirectly amends the Internal Revenue Code and has widespread applicability to individuals or small businesses. 

Pursuant to clause 3(h)(1) of rule XIII of the Rules of the House 

of Representatives, the staff of the Joint Committee on Taxation 

has determined that a complexity analysis is not required under 

section 4022(b) of the IRS Reform Act because the bill contains no 

provisions that amend the Code and that have ‘‘widespread applicability’’ to individuals or small businesses, within the meaning of 

the rule. 

F. CONGRESSIONAL EARMARKS, LIMITED TAX BENEFITS, AND

LIMITED TARIFF BENEFITS

With respect to clause 9 of rule XXI of the Rules of the House 

of Representatives, the Committee has carefully reviewed the provisions of the bill, and states that the provisions of the bill do not 

contain any congressional earmarks, limited tax benefits, or limited 

tariff benefits within the meaning of the rule. 

G. DUPLICATION OF FEDERAL PROGRAMS

In compliance with Sec. 3(j)(2) of H. Res. 5 (113th Congress), the 

Committee states that no provision of the bill establishes or reauthorizes a program that was included in any report from the Government Accountability Office to Congress pursuant to section 21 

of Public Law 111–139. The Committee also states that the most 

recent Catalog of Federal Domestic Assistance, published pursuant 

to the Federal Program Information Act (Public Law 95–220, as 

amended by Public Law 98–169), identified a program related to 

conservation easement contributions. 


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H. DISCLOSURE OF DIRECTED RULE MAKINGS

In compliance with Sec. 3(k) of H. Res. 5 (113th Congress), the 

following statement is made concerning directed rule makings: The 

Committee estimates that the bill requires no directed rule makings within the meaning of such section. 

VI. CHANGES IN EXISTING LAW MADE BY THE BILL, AS 

REPORTED 

In compliance with clause 3(e) of rule XIII of the Rules of the 

House of Representatives, changes in existing law made by the bill, 

as reported, are shown as follows (existing law proposed to be omitted is enclosed in black brackets, new matter is printed in italic, 

existing law in which no change is proposed is shown in roman): 

INTERNAL REVENUE CODE OF 1986 

* * * * * * * 

Subtitle A—Income Taxes 

* * * * * * * 

CHAPTER 1—NORMAL TAXES AND SURTAXES 

* * * * * * * 

Subchapter B—Computation of Taxable Income 

* * * * * * * 

PART VI—ITEMIZED DEDUCTIONS FOR INDIVIDUALS 

AND CORPORATIONS 

* * * * * * * 

SEC. 170. CHARITABLE, ETC., CONTRIBUTIONS AND GIFTS. 

(a) * * * 

(b) PERCENTAGE LIMITATIONS.— 

(1) INDIVIDUALS.—In the case of an individual, the deduction 

provided in subsection (a) shall be limited as provided in the 

succeeding subparagraphs. 

(A) * * * 

* * * * * * * 

(E) CONTRIBUTIONS OF QUALIFIED CONSERVATION CONTRIBUTIONS.— 

(i) * * * 

* * * * * * * 

ø(vi) TERMINATION.—This subparagraph shall not 

apply to any contribution made in taxable years beginning after December 31, 2013.¿ 

* * * * * * * 

(2) CORPORATIONS.—In the case of a corporation— 

(A) * * * 


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(B) QUALIFIED CONSERVATION CONTRIBUTIONS BY CER- TAIN CORPORATE FARMERS AND RANCHERS.— (i) * * * 

* * * * * * * 

ø(iii) TERMINATION.—This subparagraph shall not 

apply to any contribution made in taxable years beginning after December 31, 2013.¿ 

* * * * * * * 


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VII. DISSENTING VIEWS 

The six bills approved by the Republicans at the markup would 

add $304 billion to the deficit. Combined with the $310 billion that 

the six bills approved by Republicans on the Committee in April 

added to the deficit, Republicans have added $614 billion to the 

deficit in two short months—and there does not appear to be an 

end in sight. Even though some of these bills were introduced individually with some bipartisan support, the opposition to these bills 

was based on the position that these tax provisions should not be 

made permanent by adding to the deficit without any revenue offset. 

To put the combined cost ($614 billion) into context, it is 25 percent more than the entire projected federal deficit this year and 

$86 billion more than total non-defense domestic discretionary 

spending (e.g., medical research, education, veterans’ pensions and 

health care, transportation, etc.) will be in 2014. It is almost seven 

times what we spend annually on education, job training, and social services. It is ten times more than we spend on veterans. And, 

it is eleven times more than we spend on medical research and 

public health. 

Public charities and private foundations serve an important role 

in our society. We all support the good works of the charitable community and strive to provide charities with the resources they need 

to carry out their charitable mission. The markup was not to debate the good works of charities across this country, or the merits 

of H.R. 2807 which would make permanent the deduction for conservation easements. 

We found it hypocritical that, four months ago, Republicans let 

emergency unemployment insurance expire for more than 1.3 million Americans by arguing that an adequate offset had yet to be 

proposed. In early April, the Senate came to a bipartisan agreement on an offset after months of painstaking negotiations. Yet 

House Republicans still refuse to act. 

Finally, we also opposed the manner in which Republicans were 

proceeding—selecting 10 to make permanent without any offset 

from the approximately 60 tax provisions that expired last year. 

This approach was both fiscally irresponsible and fundamentally 

hypocritical. 

The consideration of this bill should have been part of the consideration of all the expired tax provisions commonly referred to as 

‘‘tax extenders.’’ The Republicans did not take up other tax extenders that also are important to Democratic Committee Members. 

Left to an uncertain fate are provisions like the Work Opportunity 

Tax Credit, the New Markets Tax Credit, and the renewable energy tax credits, as well as the long-term status of the Earned InVerDate Mar 15 2010 05:18 Jul 01, 2014 Jkt 039006 PO 00000 Frm 00014 Fmt 6604 Sfmt 6604 E:\HR\OC\HR494.XXX HR494

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come Tax Credit, the Child Tax Credit, and the American Opportunity Tax Credit. 

SANDER M. LEVIN, 

Ranking Member. 

Æ 


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