Source: National Association of Police Organizations.
The Washington Report: The Newsletter of the National Association of Police Organizations
July 2, 2025
Senate Passes One Big Beautiful Bill
After record-setting hours of debate and votes on amendments, the Senate passed President Trump’s priority legislation, the One Big Beautiful Bill (OBBB), early on July 1 by a vote of 51-50, with Vice President Vance casting the tie-breaking vote. It is now back with the House for consideration and Speaker Mike Johnson (R-LA) stated he will bring the bill up for a vote as soon as July 2, with the goal of passing it without further amendment before the President’s imposed deadline of July 4. At this point, however, it is unclear if the House has the votes to pass it as is given the changes made by the Senate or if they will need to amend it to get it through.
The Senate-passed OBBB includes provisions to strengthen funding to help state and local law enforcement protect communities from cross-border crime as well as several tax provisions that would impact NAPO members, including no tax on overtime pay (with a cap), an increase in the state and local tax (SALT) deduction cap, and an end to de minimis treatment for all low-value commercial shipments.
The legislation supports immigration and law enforcement efforts, including bolstering funding for Immigration and Customs Enforcement (ICE) 287(g) agreements for state and local law enforcement participation in federal immigration efforts. It also includes $3.33 billion in funds for Department of Justice immigration efforts, anti-drug task forces, and for the Bryne Justice Assistance Grant (JAG) and Community Oriented Policing Services (COPS) programs to help state and local agencies investigate and prosecute violent crime, support criminal enforcement initiatives, and assist in immigration enforcement.
Additionally, the Senate OBBB creates a State Border Security Reinforcement Fund within the Department of Homeland Security (DHS) for grants to state and local governments to assist with efforts around building a border wall or barrier, the detection and interdiction of illicit substances and illegal aliens who have committed a federal, state, or local crime, and the transfer and referral of such aliens to DHS. The bill provides $10 billion through 2034 for this Fund.
The Senate also included in its bill an additional $500 million under the DHS State Homeland Security Grant Program to increase state and local capabilities to detect and track unmanned aircraft systems (UAS).
As for the tax provisions, the Senate bill makes overtime pay an above-the-line deduction for eligible individuals, but unlike the House version, it sets limitations on the amount of overtime that can be deducted. Under the Senate bill, an individual cannot deduct more than $12,500 in overtime per tax year ($25,000 for a joint return) and reduces the allowable amount by $100 for every $1,000 by which an individual’s modified adjusted gross income exceeds $150,000 (or $300,000 for a joint filing). Overtime-earning taxpayers will enjoy this tax-free overtime provision until December 31, 2028, when it expires.
The Senate OBBB also includes the House-passed increase in the SALT deduction cap, which takes it from the current $10,000 to $40,000 and places a cap on the ability of high-income individuals to deduct state and local taxes starting with taxpayers with income over $500,000. The Senate bill, however, sunsets the increased SALT deduction cap in 2030, returning it to the current $10,000 threshold.
In a significant victory for NAPO, the OBBB includes language to end de minimis treatment for all low-value commercial shipments effective July 1, 2027. Closing the de minimis loophole for commercial packages will help stop the flow of illicit narcotics coming across our borders and greatly assist law enforcement in the fight fentanyl. NAPO joined our partners in the Coalition to Close the De Minimis Loophole in commending the Senate for maintaining this important provision.
NAPO is closely monitoring House action on the OBBB and will keep our members informed of any significant changes that may affect them.
To read NAPO’s analysis of original House-passed version of the OBBB, which was passed on May 22, read our Washington Report from that day.
