Inside AGC Legislative Update

Jan/Feb 2010

Issues to Watch in 2010

AGC’s top legislative concerns for the year

Carolinas AGC members and staff greet Senator Richard Burr (R-N.C.) at the National and Chapter Leadership Conference, where more than 200 chapter leaders made visits to Capitol Hill. Left to right: Mike Murphy, Michael Long, Sen. Richard Burr, Stephen Gennett and Samuel Hood.

With congressional action on the stimulus, card check, health care and a host of other issues, 2009 has been a busy year for AGC’s government affairs team. Depending on your point of view, the good or bad news is that 2010 will be an even busier year in Congress. Our team of policy experts and lobbyists will be on the forefront of dealing with several issues, fighting for the interests of the construction community and keeping each AGC member informed on the latest developments.

Here’s a brief preview of some of the major developments AGC expects to see on the Hill next year. For more information, please visit www.agc.org/legislative.

Health Care

AGC has taken an active role in this debate from the beginning and joined forces with two major national coalitions to show the true cost of proposed health-care reform measures on construction firms. AGC continues to work on identifying ways to improve the legislation as it moves through the legislative process. A bill is expected to reach the president’s desk in January. Read the latest on health-care reform at www.agc.org/healthcare.

Energy and Climate Change

With the House having passed comprehensive energy and climate-change legislation in June 2009 to address global-warming concerns, attention now turns to the Senate where the path to final passage is steep. Senators on both sides of the aisle are debating whether a market-based system (i.e., “cap-and-trade”) is the best way to regulate and reduce U.S. greenhouse-gas emissions. At the same time, the U.S. Environmental Protection Agency is moving forward on regulatory efforts under the Clean Air Act.

Surface Transportation Reauthorization

SAFETEA-LU expired on September 30 without Congress taking action on a new authorization bill. As a result, Congress has twice extended the current law, with the most recent extension expiring on December 18. Until a multiyear reauthorization bill is signed into law, Congress will need to keep extending SAFETEA-LU to ensure federal transportation programs continue to operate without interruption.

The leaders of the House Transportation and Infrastructure and the Senate Environmental and Public Works committees support action on a six-month extension following the expiration of the most recent extension. The administration supports an 18-month extension. AGC has called for a six-year highway and transit bill to create long-term, sustainable jobs.

Clean Water Restoration Act

A House committee is expected to consider legislation that would significantly expand federal jurisdiction over waters and wetlands under the Clean Water Act, and require all construction activity to first obtain a permit. Sponsors of the legislation have been unable to overcome growing opposition to the bill’s impact on the regulated community and have not yet been able to craft an acceptable compromise. A Senate committee passed a so-called compromise in June, but it does not address concerns that it would result in an overreach of federal authority.

Card Check

The Employee Free Choice Act, or Card Check, proposes major changes in the way union organizing and first-contract settlements take place. EFCA would take away workers’ rights to a secret ballot and impose mandatory mediation and arbitration in first-contract negotiations if settlement is not reached within a short time frame.

The Senate does not currently have the 60 votes it needs to break a filibuster, but leaders have vowed that this will come to the floor in 2010. The House is expected to wait for the Senate to act on the legislation.

Water Infrastructure Funding

Congress is currently debating a number of different measures that have the potential to lead to significant new investments in the nation’s aging water infrastructure. In the Senate, members are expected to vote on a measure early in the year that would authorize over $39 billion for water projects during the next five years. The House, meanwhile, will be considering two separate measures. One, the Water Protection and Reinvestment Act, would establish a five-year, $50-billion water infrastructure fund. The other, the Sustainable Water Infrastructure Act, lifts the cap on private activity bonds for water and sewage facilities to leverage greater private-sector investments With the New York Times reporting in December that an estimated 20% of drinking water in the U.S. is unsafe, AGC will continue to push for swift passage of any measure that addresses the current funding gap in our nation’s drinking and wastewater facilities.

Tax Reform

A broad range of tax cuts enacted in 2001 and 2003 are set to expire on December 31, resulting in significantly higher tax rates for businesses and individuals. Congress will have to consider whether to extend or modify existing tax law in the context of the recovering economy, growing deficits and policy agenda in a mid-term election year. Congress may consider AGC priorities such as 3% withholding, estate tax reform, independent contractors and lookback accounting.

Immigration

The administration and some congressional leaders have indicated that they want to try to tackle comprehensive immigration reform in 2010. AGC remains close to the discussions on the formation of such a bill, focusing specifically on employer responsibilities and duties, as well as the development of a workable future workplace visa. The time frame for movement in 2010 is very short since this is a controversial issue leading into the elections.

Federal Aviation Administration Reauthorization

The Federal Aviation Administration has been operating under short-term extensions since the authorization of the Airport Improvement Program expired in September 2007. While congressional leaders have said the legislation is a priority, it is unclear if this Congress will be able to resolve a number of contentious issues. The AIP is the primary source of federal grants to airports for airport development and planning. AGC is pushing for appropriate increases to the aviation user fee structure to meet airport capital investment needs while also providing for air traffic control modernization.

“Jobs” Bill

The early days of the second session of the 111th Congress should see a good amount of activity over passage of legislation that would address the unemployment crisis. With the job loss rate in the construction industry hovering at 20%, House and Senate Democrats are busy drafting legislation to address this issue. 

AGC has been working closely with leadership in the House and Senate to ensure that any bill includes a significant increase in infrastructure spending targeted to existing programs that can have an immediate impact in providing the construction industry with a much needed shot in the arm. 

In addition to infrastructure spending, Congress is considering extending unemployment insurance, renewing a program that offers the unemployed a 65% subsidy for health insurance premiums under COBRA, providing tax credits to employers who hire new employees and increasing the amount of loans offered through the Small Business Administration.

Water Resources Development Act Reauthorization

November marked three years since the passage of the last WRDA bill. In August 2009, House leaders began the lengthy process of putting together a new WRDA for consideration in 2010.

WRDA is a biennial comprehensive water-resources law that authorizes studies and projects within the U.S. Army Corps of Engineers mission areas, including navigation, flood damage reduction, hurricane and storm damage reduction, shoreline protection and environmental restoration. AGC has long advocated for timely passage of new WRDA bills to address new project studies and authorizations and will continue to do so in 2010.

Federal Contracting Reform

The 111th Congress continued to use its oversight authority to review contracting reform and target industries that have been accused of abusing the federal procurement system. President Obama in 2009 ordered the Office of Management and Budget (OMB) and the Federal Acquisition Regulation (FAR) Council to issue a series of directives for improving critical components of the federal acquisition system. Congress also is expected to address several key areas, including contract bundling and other reforms.

Another key component of this effort is reauthorization of the Small Business Act. Substantial progress is expected this year on issues concerning AGC members, particularly the contracting reform provisions, which will address counting subcontractors at lower tiers, contract bundling reform and a review of the rules governing the HUBZone program and Alaskan Native Corporations (ANCs).

In addition, the U.S. Small Business Administration in October 2009 announced a notice of proposed rulemaking that would substantially revise contracting rules for firms benefiting from the 8(a) Business Development program. The proposed changes are the result of the first comprehensive review of the 8(a) program in several years. The rules cover a variety of areas of the program, ranging from providing further clarification on determining economic disadvantage to requirements on joint ventures and the Mentor-Protégé program. Action is expected in 2010 on that rulemaking.