ISSUES

Overview

HARDI Advocacy efforts are centered around specific key issues relevant to the HVACR industry, wholesale distribution, and family & small businesses. The primary objective of HARDI Advocacy is to educate elected officials on legislative and regulatory issues that specifically affect HVACR distributor members, their customer base, or the products they supply.

Hydroflourocarbon (HFC) Phase-down/Kigali Amendment

The HVACR industry is heavily invested in the development, distribution, sale, and installation of new refrigerants and phasing down the use of HFCs. HARDI supports legislation to phase down the production of HFCs over a scheduled period of years. A schedule phase down provides predictability for the direction of the refrigerant industry for manufacturers, distributors, and contractors. HARDI is working with industry allies to phase down the use of HFCs.

Issue Brief

Tariffs & Trade


Steel & Aluminum Tariffs

In March 2018 new tariffs on imports of steel and aluminum from nearly all foreign sources was implemented. These new tariffs, 25 percent on steel and 10 percent on aluminum, have already had an impact on the cost of HVACR products. Currently Argentina, Australia, Brazil, and South Korean imports of steel and aluminum are exempt from the tariffs. We expect the finalized renegotiation of NAFTA to also exempt steel and aluminum from Canada and Mexico.

Past Issue Alerts:
President Trump to Levy Additional Tariffs on Chinese Imports
Trade Update: Mexico, China, and Global Growth
Trump to End Steel and Aluminum Tariffs with Mexico and Canada
U.S. – China Trade Agreement

China

President Trump announced plans to increase Chinese tariffs on many HVACR products starting on October 1, 2019. Many of the products that currently have 25 percent tariffs will increase to 30 percent. Additionally, products on the latest round of tariffs that were originally set to begin on September 1, will be set at 15 percent instead of 10 percent.

An updated list of tariffs is available here.

HVACR Products & Supply Tariffs

The most rounds of tariffs announced in June and July of 2018 include many specifically listed HVACR equipment and parts. For products listed on June 15, 25 percent tariffs were implemented on July 6 and August 23. For products listed on July 17, a 10 percent tariff will begin on September 24 before increasing to 25 percent in 2019. This will result in prices increases across the vast majority of HARDI member products.

On September 18, an additional round of tariffs was announced, affecting more than 25 additional HVACR products and parts. These are included in the updated tariffs list linked below.

The full list of tariffs and specified products can be found here:

Small Business Tax Issues


Tax Cut Permanence

In December 2017, the Tax Cuts and Jobs Act was signed into law, resulting in major beneficial changes for businesses. Included in the provisions were substantial reductions in the corporate and pass-through tax rates, a doubling of the estate tax exemption threshold, and full immediate expensing of HVAC equipment purchases for businesses. The issue here is that the individual-side provisions like the pass-through tax rate reduction and raised estate tax threshold have an expiration date and are set to sunset in 2025.

Since many HARDI members are small business and pass-through entities, we are pushing for permanence of the individual-side provisions from the Tax Cuts and Jobs Act. This will result in more predictability to allow HARDI members to have more effective business or succession planning for the future.

Relevant Legislation:
Main Street Certainty Act (H.R. 216)

Issue Brief

Estate Tax Repeal

HARDI members believe the estate tax should be repealed because it disproportionately impacts small and family-owned businesses. Compliance costs associated with the estate tax and the substantial burden of the tax itself cause small businesses to forego the hiring of new employees, expansion of businesses, and in many cases, force the sale of the company.

HARDI supports the full and immediate repeal of the Estate Tax.

Relevant Legislation:
Death Tax Repeal Act (H.R. 218 and S. 215)

Issue Brief

Workforce Issues


DRIVE Safe Act

The DRIVE Safe Act is sponsored by Congressman Duncan Hunter (R-CA50) and would offer high school graduates training for interstate commercial drivers licenses that they are currently ineligible to hold. The HVACR wholesale distribution sector facing an upcoming shortage of qualified drivers to move our products through the interstate supply chain. Commercially licensed truck drivers are the linchpin of the entire HVACR logistics network, moving equipment from suppliers to distributors, and from distributors to customers.

One of the primary obstacles to bringing younger drivers into the profession is the requirement that they be at least 21 years old to drive across state lines, despite the fact that almost every state allows for commercial driver’s licenses to be issued at the age of 18. The DRIVE Safe Act would alleviate the current shortage of qualified CDL holders by allowing younger drivers to train with experienced drivers. We believe that this legislation will benefit our economy and make America’s highways safer in the future.

Relevant Legislation:
DRIVE Safe Act (H.R. 1374 and S. 569)

Issue Brief

Growing the Workforce and Promoting Careers in the Trades

It is a well-known issue in the HVACR industry that there is a shortage of skilled trade labor, and the effects are felt daily. While manufacturing and distribution warehousing jobs fall into this category, a healthy amount of certified contractors is also essential to success throughout the supply chain in our industry.

HARDI members support legislation that will generate an influx of HVACR professionals with the tools and knowledge they need to compete for high-skilled, in-demand jobs in the industry.

In 2018, Congress passed and the President signed the 

Relevant Legislation:

Strengthening Career and Technical Education for the 21st Century Act (Signed into law 7.31.18) PROSPER Act (H.R. 4508)

California Issues


CALIFORNIA PROPOSITION 65 UPDATED LABELING REQUIREMENTS 7.13.18

Beginning on August 30, 2018, California’s Proposition 65 (or “Prop 65” as it is often referred) includes updated labeling requirements for businesses to notify consumers with “clear and reasonable” warnings of potentially hazardous chemicals present in products

DOE Regional Standards


Effective August 15th, 2017 records must be maintained by installing contractors for the installation of Central Air-Conditioners (In the South and Southwest) and Single-Package Air-Conditioners (In the Southwest Region). The following information must be maintained for four years by contractors:

Split-system Central Air Conditioners

(Contractors must maintain the following for both the condensing unit and indoor unit, not including uncased coils sold as replacement parts)

  • Manufacturer
  • Model Number
  • Serial Number
  • Date unit was purchased
  • Contact information from whom the unit was purchased
  • Date the unit was sold
  • Contact information of the purchaser (name/ address/ phone number).
  • Installation Address

Single Package Air Conditioners

  • Manufacturer
  • Model Number
  • Serial Number
  • Date unit was purchased
  • Contact information from whom the unit was purchased
  • Date the unit was sold
  • Contact information of the purchaser (name/ address/ phone number).
  • Installation Address

DOE Regulation Signage

HARDI has created a storefront for members to order signage that can be placed within your storefronts to show all necessary measures are being taken to ensure compliance.

ORDER HERE

 

Additional Compliance Measures

HARDI advises members that a key compliance strategy will be the continued education of customers and employees. Some companies have taken the additional step of including compliance language on packing slips or invoices. Among the versions we have seen:

“By accepting this product, I agree that it will be installed in accordance with all local, state and federal requirements.”

“This product may be subject to Regional Efficiency Standards. Please refer to the Energy Guide label or http://www.energy.gov/gc/regional-standards-enforcement to ensure compliance.”

“By accepting this product, I agree that (Insert Company) has informed me of any restrictions regarding installation requirements of Regional Efficiency Standards and take sole responsibility for the future sale and/or installation of this unit.”