Construction Legislative Week in Review
www.agc.org March 10, 2011
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On the Inside
TAX
296 Days Until 3% Withholding Begins Action Needed
BUDGET
Competing Budget Plans Fail in Senate
TRANSPORTATION
Transportation Secretary Defends FY 2012 Budget
TAX
296 Days Until 3% Withholding Begins Action Needed
 

AGC continues to urge Congress to repeal the 3 percent withholding requirement on federal, state and local government contracts.

Starting January 1, 2012, public owners will begin withholding 3 percent of every payment to contractors. Legislation has been introduced in the House and Senate to repeal this mandate and grassroots contact from AGC members is important. To write your legislators and urge them to cosponsor the legislation, click here.

Currently H.R. 674 has 30 cosponsors in the House and S.164 has 2 cosponsors in the Senate.  

For more information, contact Karen Lapsevic at lapsevick@agc.org. Return to Top

BUDGET
Competing Budget Plans Fail in Senate
 

On Wednesday the Senate failed to get the required 60 votes necessary on competing Republican and Democratic plans to cut discretionary spending and fund the remainder of fiscal year 2011. 

The Republican plan, which passed the House of Representatives last week, was defeated by a vote of 44-56 with three Republicans (Rand Paul (R-Ky.), Mike Lee (R-Utah), Jim DeMint (R-S.C.)  joining every Democrat in voting no.  Two Democrats, Claire McCaskill (D-Mo.) and Ben Nelson (D-Neb.) also voted against both bills. All five members expressed frustration that neither bill did enough to eliminate the debt, specifically by ignoring entitlements. The Republican bill would have cut $57 billion in discretionary spending while funding the federal government through September 30, 2011.  The Democratic plan, which failed by a vote of 42-58 with 11 Democrats joining every Republican in opposition, would have also funded the federal government through September 30, 2011, but would have only cut discretionary spending by $4.7 billion.

The outcome of these two votes sets the stage for another short-term extension if an agreement between the House, Senate and the White House cannot be reached by March 18 when the current continuing resolution expires.  It does not appear that any bipartisan negotiations between the White House and Congress have taken place this week on the path forward for the FY 2011 budget, which increases the likelihood of another short term extension.  In fact, House Majority Whip Kevin McCarthy (R-Calif.) announced this week that the House is preparing to move forward on a short-term continuing resolution that will continue to cut discretionary spending at $2 billion per week. If they are successful passing a second short-term bill, it will likely fund the government through April 1.

AGC continues to work against many of the cuts to construction spending, urging Members of Congress to work to reform and improve programs rather than just slash spending.

For more information, contact Sean O’Neill at (202) 547-8892 or oneills@agc.org. Return to Top

TRANSPORTATION
Transportation Secretary Defends FY 2012 Budget
 

United States Department of Transportation Secretary Ray LaHood made the rounds this week in the Senate defending his agency’s fiscal year 2012 budget in front of three Senate Committees.  The Secretary appeared before the Commerce, Science, and Transportation; Environment and Public Works; and Appropriations Committees to discuss the USDOT budget as part of a six-year, $556 billion surface transportation reauthorization bill. 

Secretary LaHood stuck to a common theme at the hearing, insisting the Administration’s proposal is a “big, bold” jobs bill but offered no answers as to how to fund such a large proposal.  In fact, Secretary LaHood reiterated President Obama’s position against the only logical way to fund a proposal of their size: increasing the federal gas tax.  When faced with multiple questions on how then the Administration planned to fund it, Secretary LaHood offered that “we” need to work with Congress to come up with the funding. He did, however, offer the Administration’s willingness to consider tolling to pay for projects that add capacity to the current network, expand the TIFIA loan program, and create an infrastructure bank as alternative ways to finance transportation projects. Secretary LaHood will address the AGC Convention in Las Vegas during the Closing Convention Session at 9:00am on Friday, March 25.

In terms of the President’s proposal on high speed rail, the Secretary reinforced President Obama’s commitment to moving forward on a high speed rail network, and upon questioning from Senator Roy Blunt (R-Mo.), acknowledged that high speed rail will be funded out of the Transportation Trust Fund (DOT renamed the Highway Trust Fund the Transportation Trust Fund in the FY 2012 budget request). The administration has stated that their vision of a transportation trust fund would continue the separate accounts for highways and transit but would add an additional account for rail. The only income currently going to the highway trust fund comes from highway users. The administration has yet to identify a source of funding for the rail account.

As Congress and the Administration continue to work towards passing a surface transportation reauthorization bill, AGC will work with all parties to ensure the next authorization bill is based in reality, addresses the true national priorities of our surface transportation system, and has a positive impact on the construction industry.

For more information, contact Sean O’Neill at (202) 547-8892 or oneills@agc.org. Return to Top

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