Washington, DC – Today, Ways and Means Subcommittee on Oversight Chairman Charles Boustany, Jr., M.D. (R-LA) sent a letter to 15 departments and two agencies across the federal government seeking information about the potential abuse of the Energy Efficient Commercial Buildings Deduction, commonly referred to as the “179D Deduction.”  Documentation recently obtained by the Ways and Means Committee suggests that the General Services Administration (GSA) may be using the deduction to secure kickbacks from contractors by requiring the contractor to write checks payable to GSA for 19 percent of the value of the deduction.

Discussing the letter, Boustany commented, “The action by the GSA raises a number of serious questions about whether this particular tax deduction is being abused.  Requiring a cash payment in exchange for a tax deduction is a kickback, pure and simple.  We must ensure that this tax deduction is being used for its intended purpose and not being sold to line some government slush fund.  Given the wide range of abuse of taxpayer dollars being used for everything from fortune tellers to clowns to spaying pets, it is clear that strong and vigorous oversight is necessary to ensure that taxpayer dollars are being protected.”

The departments and agencies must provide information to the Subcommittee by May 18, 2012, covering a range of areas including:

1. Copies of all letters sent by the government to contractors or other entities regarding the 179D deduction;
2. The total amount of deductions a government entity has allocated, and a detailed breakdown of the contractor(s) or other entities receiving allocations, including the amount of the deductions;
3. Information about whether the government entity requested or received a percentage of the deduction from the contractor or other entities to whom the deduction was allocated; and
4. How the government entity used these funds, including information detailing the accounts the funds were deposited into and by whom.

The full letter can be read here.

The fifteen departments who received the letter are:

Department of Agriculture
Department of Commerce
Department of Defense
Department of Education
Department of Energy
Department of Health and Human Services
Department of Homeland Security
Department of Housing and Urban Development
Department of the Interior
Department of Justice
Department of Labor
Department of State
Department of Transportation
Department of Treasury
Department of Veterans Affairs

The two agencies who received the letter are:

General Services Administration
Environmental Protection Agency