The paradox of much of our work is that in advancing change, what we’re often looking for is certainty – stable, pro-business policies and legal frameworks that will allow hoteliers to make long-term plans with confidence. AHLA has already made important progress this year and we’re focused on doing even more.
Tax Certainty.
Coming into 2025, the greatest uncertainty the industry faced was the imminent expiration of pro-business provisions of the 2017 Tax Cuts and Jobs Act (TCJA). Allowing those policies to expire would have cost hotel owners billions; AHLA, our partner state associations, and our members began working with legislators and Congressional staff more than a year ago to prevent those lapses.
The enactment of the Working Families Tax Cut Act in July not only preserved the benefits of TCJA but made most of them permanent, providing invaluable certainty to the industry – especially to the small businesses that make up the majority of U.S. hotels. The combination of extending the 199A deduction, which preserves the qualified business income deduction for small business owners; expanding Section 179 expensing and bonus depreciation; and fixing the EBIDTA-based interest limitation creates an incentive of almost $24 billion for small businesses to reinvest over the next 10 years.
The package approved this summer was also valuable to the industry for what it didn’t include. In its deliberations, Congress rejected several provisions that would have amounted to backdoor tax increases on hoteliers, including changes to the treatment of state and local tax deductions for businesses, individual and marginal tax rates and the treatment of carried interest.
Clarity on the Joint-employer Standard.
The franchise model has been making the American dream available to small business owners for more than 80 years. It's the backbone of our industry; nearly 60% of U.S. hotels operate as franchises. Those small businesses employ hundreds of thousands of employees who work for those owners, not for their corporate brands. But since the National Labor Relations Board’s publication of an overly broad standard in 2015, the hotel industry has seen five different versions of the definition of "joint employer” – and the issue is still pending before the D.C. Court of Appeals. This lack of certainty has been extraordinarily disruptive, raising legal issues, damaging employer-employee relationships and eliminating opportunities.
The American Franchise Act, a bipartisan, bicameral bill introduced in September, offers a commonsense solution: a clear, permanent standard in the form of narrow amendments to the National Labor Relations Act and the Fair Labor Standards Act. The bill would clarify that franchisors may be considered joint employers only if the franchisor exerts “substantial, direct and immediate control” over one or more essential terms of employment. This straightforward fix will provide certainty about the nature of the employment relationship and protect the hotel business model that has been so critically important to the industry.
Visa Programs that Work.
Five years after the COVID-19 pandemic, regional and seasonal workforce shortages continue to challenge the hotel industry. More than 200,000 positions remain unfilled nationwide, despite expanding benefits and industry wages rising more than 15% faster than the national average. AHLA has long advocated for legislation to expand the H-2B visa program that allows seasonal hotels and resorts to meet travelers’ needs. We are also in constant dialogue with the U.S. Departments of Labor and Homeland Security about how best to meet staffing needs, comply with changing policies, and expedite approvals under existing processes while balancing national security. Clarity and consistency make it easier for hoteliers to plan for growth and maximize opportunity.
Hoteliers need certainty in order to focus on the daily demands of their business and on their long-term plans for success. Federal policies can help provide that certainty, and securing those policies is AHLA’s mission.
