Trying not to Lose Ground: State and Local Government Advocacy during Passage of the 2017 Tax Cuts and Jobs Act

Abstract

Abstract The Tax Cuts and Jobs Act of 2017 (TCJA) was the first major federal tax reform in a generation. This article examines the priority issues of fifty-seven intergovernmental advocacy organizations during the legislation’s passage. These groups played defense from the start, in response to efforts by President Trump and congressional Republicans to streamline the tax code by eliminating tax expenditures. Blocking the potential elimination of the state and local tax (SALT) deduction and preserving the tax exempt status of municipal bond interest represented priorities for most organizations. Ultimately, the TCJA preserved many tax expenditures important to intergovernmental advocacy organizations. However, the SALT deduction was capped at $10,000, representing a big loss. This case study evaluates when and under what conditions the intergovernmental lobby influences federal policy-making. It finds that while state and local groups use a variety of tactics, their ability to navigate partisan politics and harness the self-interest of members of Congress is necessary to success.