The effort to avoid the fiscal cliff is operating on two tracks: private negotiations continue between the White House and House Republicans; each side also continues publicly to criticize the other side’s latest offers and countermoves.

Those two approaches may really be two rails of the same track, with the public statements part of the negotiating strategies. The fiscal cliff deadline is the end of the year, when tax cuts that date back as far as 2001 are due to expire, with mandatory spending reductions also due to kick in on Jan. 2.

At stake for construction are the amount of 2012 taxes many small design and contractor firms will pay as well as spending levels for federal infrastructure programs that are key markets for industry companies of all sizes.

The latest development was the Dec. 18 announcement by House Speaker John Boehner (R-Ohio) of what he termed “Plan B,” a proposal to raise tax rates, but only for those with income above $1 million. It did not deal at all with the $109 billion in mandatory 2013 “sequestration” budget cuts due to take effect Jan. 2.

Boehner told reporters he was turning to Plan B because President Obama’s latest offer, which Boehner said includes raising $1.3 trillion in revenue over 10 years and reducing spending by $850 billion over that period, is not a “balanced plan.” 

Details were sketchy, but Boehner did say that provisions concerning the alternative minimum tax and the estate tax “could likely be part of the bill that we would bring to the floor.” But he added,  “We would not deal with the sequester.”

The future level of taxes on individuals has a direct impact on the many small design and construction firms that are organized as partnerships, sole proprietorships or S corporations, which are taxed at individual, not corporate, rates.

Boehner said he planned to draft legislation to carry out Plan B and have it on the House floor later this week.

He added, “I continue to hope that we can reach a broader agreement with the White House that would reduce spending as well as have revenues on the table.”  But he said that at this point, the “backup” Plan B “was the right course of action for us.”

Obama said in a Dec. 19 press conference that his own proposal "is a balanced package by any definition." He said that it includes nearly $1 trillion in spending cuts, and, if reductions in interest on the debt are included, the total cuts exceed $1 trillion.

Obama also said that Boehner's plan would not extend unemployment insurance, and would mean "a tax increase for millions of working families across the country at the same time as folks like me would be getting a tax break."

Congressional Democrats blasted Boehner's Plan B. House Minority Whip Steny Hoyer (D-Md.), meeting with reporters shortly after Boehner’s press conference, said he was pleased that the Speaker was continuing his negotiations with Obama, and viewed it as a sign Boehner “is still engaged” in those talks. But Hoyer called Plan B “not helpful” and “more of a political ploy than…a step forward.”

Hoyer said that Plan B’s “math doesn’t work,” because the single element of raising rates for millionaires would boost federal revenue by just $250 billion to $300 billion over 10 years, well below the $1-trillion-plus target both sides say they are aiming for.

With the end of the year fast approaching, expect more rhetoric and substantive negotiations in the days to come.

Updated later on Dec. 19 to include Obama comments from press conference.