Podcast - The One Big Beautiful Bill Act and What It Means for the Real Estate Industry

Vivian de las Cuevas-Diaz: My name is Vivian de las Cuevas-Diaz , the deputy section leader for Holland & Knight for the Real Estate section. And we've had some great fireside chats with my two partners from Washington D.C., I'm going to let themselves introduce themselves and we're going to have a couple of questions on that one big beautiful bill. 

Andrew Siracuse: Hi, I'm Andrew Siracuse. I am a partner at Holland & Knight's Washington D.C. Office and a part of the Public Policy and Regulation group. I come straight from the Hill in the U.S. Senate, worked for Senator John Cornyn as a senior tax counsel for a number of years, and also worked for Norm Coleman and the U.S. Senate Budget Committee.

Joel Roberson: Joel Roberson. I'm also a partner in the Washington DC office at Holland & Knight. I've been at the firm for eighteen years. I serve as a lobbyist on behalf of a variety of clients, including a number of clients in our real estate and hospitality group. I also worked on Capitol Hill for the House of Representatives before law school and ultimately ending up at Holland & Knight. Good to be with you.

Vivian de las Cuevas-Diaz: Thank you and thank you both for your service in D.C. We hear that the one beautiful bill, also known as OB3, It's passed. But now we got to talk a little bit about its implementation. Can you guys tell us a little bit how that would work or what we're seeing?

Andrew Siracuse: So treasury comes out [every] so often which is known as a priority guidance plan, which is a plan of what they're going to do for the next year. And there's some other cats and dogs in there, but most of the time an effort for the foreseeable future is going to be those things that were in OB3, things like no tax on tip, no tax on Social Security, etc. And there'll be some other rulemaking on those provisions that were also a part of TCJ – the Tax Custom Jobs Act that were extended and modified. So that's going to be a lot of heavy lifting by treasury in the coming months.

Joel Roberson: Yeah, because a lot of work went into what was in the budget reconciliation bill, the One Big Beautiful Bill. But now that was only half the battle. Once the top line provisions, because of some unique situations with how a budget reconciliation bill can be drafted, a lot of the details are pushed to the executive branch to work through guidance and regulations. So, entities that have priorities and what they would like to have included and where they would like to get tax benefits or funding opportunities have to be engaged with the Trump Administration to ensure that their priorities come out in the final implementation documents. And that can take a number of different forms, obviously directly working with the Treasury Department, but as Andrew mentioned, the President has been personally involved in setting a lot of the priorities as well as influencing the implementation. So, working with the White House also makes sense. While not forgetting Congress, right? Congress wrote the bill and put in priorities that were extremely important for its members, both in the House and the Senate. And so, they have significant vested interest in making sure that the implementation matches the desire that Congress had when it first was drafted. So, over the course of the next few months, as this massive tax package gets implemented, there will be significant opportunities for engagement with the White House, with the Treasury Department, as well as with Congress to help make sure that it's implemented in a way that's most favorable to your interests.

Vivian de las Cuevas-Diaz: So, does that mean people like you, Joel, in particular, spend more time on The Hill to make sure that obviously it seems like the bill's passed, there's a lot of implementation, and there's a lot of people happily affected by this in a good way. I think there's some great changes, but how do we ensure that what happens in the horizon is in line and how do you spend your time with regards to this bill, particularly in D.C.?

Joel Roberson: Yeah, it's a great question. There are lots of opportunities to engage on behalf of clients. Our Public Policy and Regulation group is over two hundred people. It's one of the largest groups in the United States. And so, we have the ability to help at a very granular level, help clients through the regulatory process to provide very substantive comments, articulate priorities of our clients to the administration in the implementation. But as we think about this and as we head into an election year next year, there's an extreme focus on trying to get legislation enacted into law before we get into what I would call the silly season of the elections, which keeps expanding longer and longer. And obviously we have a budget fight right now that continues to be ongoing, but there are opportunities for clients to engage on a bipartisan basis with Congress and then obviously with the administration as well. But that's where, you know, Andrew, maybe you could talk a little bit about the importance of relationships and getting in the room with the people that matter.

Andrew Siracuse: Yeah, I mean that's really the key is the relationship, just like in any you know, business or government, it's all about having someone that's a advocate that you have a lot of credibility, right, and engaging with folks. And I think that's an important currency in Washington, D.C. I think one other comment I would add on sort of in the near future is that one of the things I fail to mention with respect to their guidance plan, their sort of planning on what they want to do on the regulatory front, is that they have this catch-all phrase of working to reduce regulation. Very broad statement, right? So just because your issue may not be directly related to OB3, certainly those things that you have an interest in that you think makes sense that fits into the agenda that the administration has in place, I think that gives you an opportunity to advocate having good policy and the politics make sense and the people, right?

Vivian de las Cuevas-Diaz: So one last question. As you said before we get into the silly season, right? So, there's a lot of work to be done in this last quarter of the year, to start getting implemented. But in 2026, what do you see and you know, good and bad? Because as we get into the silly season it'll be interesting.

Andrew Siracuse: So, I think with respect to activity in the legislative front, right, it's going to be greatly dealt with sort of what are members wanting and what the administration wants to do. I mean, that's going to have to be some sort of external event in the first six months, right? Once you get into the silly season and there's some sort of macroeconomic shock and it's going to require some sort of congressional response that will help develop some activity. Certainly historically based on my years in the Senate, anytime you get to an end of the Congress, sort of the lame duck after the election, there can be a very compressed schedule for a lot of activity, especially in the tax front. So that's sort of the safety valve in my mind.

Joel Roberson: Yeah, and so there's some must-pass pieces of legislation that are bearing down on Congress, like the National Defense Authorization Act, reauthorizing the Department of Defense, and then passing a full year appropriations bill or another continuing resolution for fiscal year 2026. And then as we look at next year, there will be an opportunity for them to pass some big bills. There is a surface transportation reauthorization, which currently expires in September 2026, right before the election. That is typically a bill that is very bipartisan, right? Building roads and bridges in your congressional district, nothing more local than that. But being able to move forward in drafting that bill as early in the year as possible is going to be extremely important. And then as they head in towards the election, then it will be much less controversial things. Both parties will be looking at, you know, passing this bill, will it give an advantage to this party or that party, this member or that member that's put at risk. But that's where for the first half of next year, the last quarter of 2025 and the first half of next year, it's going to be super important to have access to the members of Congress and executive branch officials to get your priority on or off the list.

Andrew Siracuse: I agree, I mean because once you get in later in an election year, [an] off year especially, you tend to get a sort of a deep freeze of activity and that people want to see sort of what the landscape is going to look like after the election, right? Both sides have done it - majority [or] minority. So, you have that just the way that Congress tends to work in an election year.

Vivian de las Cuevas-Diaz: A hundred percent. So, before we close up, I just have actually one more question for you. Because this was a real estate round table as our hook, that's really our excuse to get people here and we talk about all different kinds of things. But if you were talking to real estate owners, developers, landlords, what would you say is the one piece that they should think is coming out of the OB3 that you would want to make sure they were all aware of?

Andrew Siracuse: I would tend to say the new bonus depreciation in a nutshell factories, right? Because that is a new provision and that goes to getting in to see the rule makers, to make sure that it's done in a way that real estate can take full advantage of it. Because that is a novel item. I mean you have the regular bonus depreciation that historically, right? But this new incentive and then making sure opportunity zones, right? It's made permanent, made some modifications on that. You have low-income housing tax credit, new markets tax credit. Those are now permanent, they're plused up. So, I think that would be what I would think folks would want to focus on.

Joel Roberson: And I would just add to that because Andrew's covered a lot of the highlights for real estate, but if I were a real estate company in South Florida or anywhere around the country, I'd be looking at what wasn't covered because there will be another budget reconciliation bill. This is a tool that a party has when they control the House, the Senate, and the White House, and you can guarantee that they're not going to give up another opportunity to pass a bill, just like Democrats under Biden when they had unified control and under Trump when they had unified control and under Obama, right? This is a tactic we know is going to come. So, what was left out of the bill and how can you make sure that that provision is on the list?

Andrew Siracuse: Or conversely making sure it stays off the list, right? Things that have come up in the past, you don't want to be on the menu. For sure. Because these revenue offsets tend to be like a walking zombie. You can never truly kill them, right? So you always have to be engaged in making sure that things are left on the cutting room floor. Because as a former Senate staffer, when you're pulling together legislation, you're pulling stuff off your bookshelf on ways to raise revenue. And looking my kind of exchanges, 1031, like I said, we looked into that in 2017. So that's prime ready. So, folks have to engage with Congress on those long standing issues.

Vivian de las Cuevas-Diaz: Right. Make sure they go in the direction you feel they should.

Andrew Siracuse: Absolutely.

Vivian de las Cuevas-Diaz: So, I want to thank both Andrew and Joel. Thank you for being down in Miami with us and thank you for having this great conversation. Appreciate it.