President Obama signed into law legislation which repeals the 3% withholding requirement on government payments to most contractors. ICMA and the Government Withholding Relief Coalition worked to urge the repeal, sending letters to both the House and Senate in the weeks preceding their votes.

The 3% repeal enjoyed overwhelming bipartisan support in Congress. The House originally passed a bill including the 3% repeal in late October. The Senate amended the bill to include a provision for tax breaks for employers who hire out of work veterans which passed 95-0. The amended bill was subsequently passed by the House 422-0. After passage by both houses, the bill was sent to President Obama's desk for signature.

The 3% withholding requirement would have placed unnecessary economic burdens on local governments that have already had to deal with the worst economic conditions in recent memory. Additionally, the requirement would have placed unfair costs on government contractors, who governments rely on to deliver important services to citizens.