Posted June 18, 2014
The AVMA has hired a lobbying firm as part of a push to see Congress pass, by year’s end, bipartisan legislation eliminating the federal tax on the Veterinary Medicine Loan Repayment Program.
Program participants receive up to $25,000 per year to repay student debt in exchange for working in veterinary shortage areas designated by the Department of Agriculture. Contracts are awarded for a three-year period with the option to compete for a fourth year.
The VMLRP has made awards to a total of 205 veterinarians since 2010 to serve in shortage areas in 45 states, in Puerto Rico, and on U.S. federal lands.
Unlike awards made by the counterpart in human medicine, each VMLRP award is subject to a 39 percent tax, which is paid by the USDA to the Treasury Department with funds Congress has appropriated to the program. As a result, the cost per participant, including taxes over a three-year contract, can be as much as $104,250.
The Veterinary Medicine Loan Repayment Program Enhancement Act (S. 553/H.R. 1125) would give tax-exempt status to VMLRP awards and also to the veterinary student loan repayment programs offered in 20 states. If the program were tax-exempt, the USDA could have made awards to an additional 50 veterinarians since 2010.
The bill is categorized as “active pursuit of passage” on the AVMA’s Legislative Scoring System.During a May 9 conference call, the AVMA Executive Board considered a proposal from the Governmental Relations Division in Washington, D.C., to promote expedited passage of the legislation, which was introduced in the Senate and House of Representatives in March 2013.
As the GRD explained in the recommendation background, Congress is expected to pass a tax-extension package following the midterm elections in November. GRD staff believes this package is the likeliest legislative vehicle to move the VMLRPEA for the foreseeable future. “The next few months are critical to make a strong case to key lawmakers and senior tax staff,” according to the recommendation.
The GRD suggested hiring Capitol Counsel to assist the Washington office in advocating for the legislation. Capitol Counsel specializes in tax policy and has longstanding relationships with lawmakers and staff on the Joint Tax Committee, Senate Finance Committee, House Ways and Means Committee, and Congressional Budget Office. Capitol Counsel will facilitate the development of relationships and help AVMA gain footing with the key tax-writing committees in the House and Senate, the recommendation stated.
The Executive Board approved the GRD plan to secure Capitol Counsel’s services through December.
“The Veterinary Medicine Loan Repayment Program Enhancement Act is a high-priority issue for the AVMA, and we are working hard to get the bill passed in this Congress,” GRD Director Mark Lutschaunig told JAVMA News. “We see a possible opportunity to have the bill language added to the tax-extenders package that Congress is working on this year.
“The lobbying firm—Capitol Counsel—will augment the GRD’s work in this area. They have strong relationships with the committees of jurisdiction and will assist GRD staff in our lobbying efforts on the legislation.”