How Will the New Tax Law Impact Facilities?
DON’T EXPECT TAX SAVINGS TO TRICKLE DOWN INTO FACILITIES BUDGETS
Atlanta’s new resilience strategy tackles responses to extreme climate events like major floods and heat waves, terrorist threats and long-term stresses such as
income inequality and a lack of affordable housing. The strategy
is a partnership with 100 Resilient Cities and recommends more
than 55 actions, including short-term and long-term needs.
Resilient Atlanta was created with feedback from more than
7,000 residents and a 100-member advisory group representing the city’s business, faith-based, nonprofit, academic and
civic engagement communities. Of particular interest to FMs
are calls for smarter sustainability strategies and infrastructure
■ Creating a stormwater utility fee that will fund a city-wide
stormwater management program
DESPITE THE MAJOR TAX
reduction for corporations,
the savings will probably not
trickle down to your operating
■ Launching a group purchasing plan for solar panels to
increase access to renewable energy technology
■ Developing a city investment checklist to make sure all
neighborhoods benefit from public improvement initiatives
and investments in infrastructure
■ Improving stormwater flooding responsiveness with a
permission-based data platform that will grant city officials
greater insight into the water system’s performance
■ Strengthening disaster preparedness and response in the
community by 2021 by expanding the Citizens Emergency
Response Training program
Learn more about Atlanta’s resilience plans and the 100
Resilient Cities partnership at www.resilientatlanta.com.
The recently passed tax reform has many individuals and businesses wondering exactly what will change in 2018. Corporations are expected to save considerably under the
new tax law, but what does that mean for the facilities industry?
Even though some facility
managers might need to
contend with tax-related
changes, many trends and
predictions suggest that
the change in tax code will
not have a major impact on
The Tax Cuts and Jobs
Act cuts the corporate tax
rate from 35% to 21% in
Corporations benefit most from the new tax law and are likely
to see a net tax cut of $400 billion over 10 years, explains global
real estate services firm Cushman & Wakefield. Trying to predict
what corporations might do with these savings will come down
to the goals of individual organizations.
While some might increase hiring or invest in the company
Health Insurance Propelling Change
itself, it is hard to imagine that most will. Thus, seeing those
savings transferred to facilities budgets is less likely. “We antici-
pate that the tax cut will be preferentially used to return capital
to shareholders or reduce debt, rather than to increase corpo-
rate spending,” explains Cushman & Wakefield.
Corporate facility managers should not expect these tax savings to trickle down into their individual budgets. However, for
those in the healthcare industry, there might be a little more instability, which could reach some facilities managers in that field. The
repeal of the individual insurance mandate could have consequences
for healthcare business and by extension facilities, as the business of
healthcare adapts to this change in law.
“Medical facilities could see some disruption in the short-run with
the repeal of the individual insurance mandate,” explains commercial
real estate service provider JLL. “The continuation of private activity
bonds should also support medical property development.”
With some uncertainty revolving around the healthcare sector,
facilities managers in other types of workplaces might find oppor-
tunity. According to Cushman & Wakefield, increased insurance
premiums might have a different kind of effect for facilities: it might
incentivize the adoption of wellness programs in the workplace. This
is already an emerging trend in the industry, so the change in premi-
ums might speed up that process.
Ultimately, most facilities managers will probably not find a larger
budget than in years past from the weight of the tax law itself, but it
might catalyze other changes and cultural shifts in the facilities industry.
Justin Feit firstname.lastname@example.org is Associate Editor of