U.S. House of Representatives Republicans Advance Sweeping Energy and Infrastructure Package

In late May, the U.S. House of Representatives narrowly passed the “Big, Beautiful Bill,” a sweeping legislative package backed by President Donald Trump and House Republican leadership. The bill bundles together a range of Republican priorities, including permitting reforms to accelerate energy and infrastructure projects, expanded fossil fuel development, and regulatory rollbacks across federal agencies.

Among the various business tax provisions, small businesses—including partnerships and S corporations—will be able to subtract 23% of their qualified business income from their taxes, up from the previous 20% deduction.  Additionally, businesses will temporarily be allowed to fully expense domestic research and development costs in the year they occur, as well as the cost of machinery, equipment, and other qualifying assets—encouraging productivity-enhancing investment.

The legislation now faces scrutiny in the U.S. Senate, where Republicans hold a slim majority. Senate Majority Leader John Thune has signaled support for advancing President Trump’s agenda but has also acknowledged that modifications to the bill are likely to address concerns within the Republican conference. Fiscal conservatives—such as Senators Rand Paul and Ron Johnson—have raised objections over the bill’s projected impact on the national debt and have called for deeper spending cuts and a reassessment of the proposed $4 trillion debt ceiling increase. The outcome of the Senate’s deliberations will be pivotal in shaping the final version of the bill.

ACEC/Michigan continues to closely monitor federal developments that may impact infrastructure investment, tax policy, and regulatory environments shaping Michigan’s engineering and business sectors.

State Revenue Outlook Softens Amid Economic Concerns
Michigan’s latest Consensus Revenue Estimating Conference (CREC), held May 16, revealed that the state’s economy, while still growing, is not performing as strongly as projected in January. Revenue projections for the current fiscal year (FY 2025) are now $136 million lower than expected, and FY 2026 revenues are down $320.2 million from previous estimates. Contributing factors include increased tax exemptions related to recent EITC and retirement tax changes and broader national uncertainties including federal budget instability and new tariffs.

Economists from the University of Michigan warned that recently implemented tariffs on vehicle imports and raw manufacturing materials could cost the state up to 13,000 jobs—primarily due to higher production costs and potential retaliatory trade measures. The auto sector, with its significant jobs multiplier, remains especially vulnerable.

House Appropriations Chair Ann Bollin (R-Brighton) has signaled a cautious approach to FY 2026 budget development, reviewing $2 billion in unspent work projects as deliberations continue. No formal timeline has been announced for House budget action. Meanwhile, the Senate passed a budget earlier this week that exceeds the Governor’s proposal by $1.1 billion, though recent CREC data suggests that spending plan may lead to a General Fund deficit approaching $1 billion under current projections.

Senate Reviewing House-Approved Transportation Funding Proposal
A package of transportation funding bills (HBs 4180–4187 and HB 4230), projected to generate over $3.1 billion annually, is under review in the Michigan Senate. The legislation, which passed the House with bipartisan support, proposes replacing the 6% sales tax on fuel with a dedicated fuel-specific excise tax and reallocating corporate and business tax revenues toward road and bridge infrastructure. The proposal includes measures to maintain funding for the School Aid Fund through targeted backfills. ACEC/Michigan testified in support during the House committee process and continues to advocate for long-term, sustainable investment.

Land Division Bills Raise Industry Concerns
Two bills—Senate Bill 23 and House Bill 4081—propose changes to the Land Division Act to allow municipalities to authorize additional parcel splits if land hasn’t been farmed in three years. While aimed at boosting housing availability, the Michigan Society of Professional Surveyors has raised concerns about uneven local implementation and potential impacts on coordinated infrastructure planning. SB 23 has passed the Senate; HB 4081 has cleared the House.

QBS Legislation Conversation Continues
ACEC/Michigan is advancing legislation that would require the use of Qualifications-Based Selection (QBS) for design professional procurement on state-funded projects. The measure would align Michigan’s practices with federal standards and those of 45 other states by emphasizing experience, technical merit, and innovation in the selection process—removing cost as an initial criterion. Limited exemptions for emergencies and small projects are included. Discussions with legislators and stakeholders remain active.

ACEC/Michigan Delegates Attend 2025 ACEC Annual Convention and Legislative Summit
ACEC/Michigan members traveled to Washington, D.C. for the 2025 ACEC Annual Convention and Legislative Summit, held May 17–21 at the Grand Hyatt. The event featured a robust agenda of educational sessions, leadership development, and federal advocacy. Attendees heard from national leaders including U.S. Representative Sam Graves (R-MO), Chair of the House Committee on Transportation and Infrastructure, and participated in sessions on engineering business trends, risk management, and the future of transportation policy.

Michigan Delegation Meets with Congressional Leaders
On May 20, ACEC/Michigan delegates met with members of Michigan’s Congressional delegation as part of the 2025 ACEC Annual Convention and Legislative Summit. Meetings were held with key offices including Representatives Kristen McDonald Rivet, John James, John Moolenaar, Hillary Scholten, Tim Walberg, Jack Bergman, Debbie Dingell, Shri Thanedar, and Tom Barrett. The delegation discussed top federal priorities for the engineering industry, including transportation and water infrastructure reauthorization, a pro-growth tax agenda, and workforce policy reform.

Policy materials provided during the visits emphasized the need for long-term federal infrastructure investment following the expiration of the Infrastructure Investment and Jobs Act (IIJA) in 2026, including preserving Qualifications-Based Selection (QBS) for all recipients of federal funds and streamlining local grant administration. Delegates also urged Congress to make Section 199A passthrough deductions permanent, restore full R&D expensing, and extend Section 127 to allow student loan repayment assistance to remain tax-free. With nearly 90% of firms reporting open positions, ACEC/Michigan also advocated for expanding STEM education investments and reforming high-skilled immigration policies to help address critical workforce shortages across the engineering industry.

AESLC Legislative Day Draws Strong Industry Presence
On April 15, 2025, more than 120 engineering and surveying professionals participated in AESLC Legislative Day at the Michigan Capitol. Participants met with lawmakers to advocate for key priorities, including:

• Long-term transportation funding
• QBS procurement reform
• Modernization of the State Plane Coordinate System
• Increased water and wastewater infrastructure investment
• Opposition to interior designer licensure

These conversations reinforced the vital role engineers and surveyors play in supporting public safety, infrastructure planning, and Michigan’s economy.

Looking Ahead
ACEC/Michigan will continue to work with legislators and agency officials as the budget process advances amid economic uncertainty. We remain committed to supporting policies that enhance infrastructure resilience and uphold professional standards.

Questions or want to get involved?
Visit www.acecmi.org or email Troy Hagon at thagon@acecmi.org.