Construction Legislative Week in Review
www.agc.org February 7, 2013
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On the Inside
BUDGET
President and Congress Discuss Desire to Avoid Sequester
TRANSPORTATION
House T&I Rail Subcommittee Chair to Address Highway and Transportation Division
CBO Report Confirms Highway Trust Fundís Dismal Outlook
Urban Mobility Study Illustrates Cost of Congestion
STATE & LOCAL PROCUREMENT
States Looking at Buy American Clauses
CONGRESS
Senator Saxby Chambliss Will Not Seek Re-Election
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BUDGET
President and Congress Discuss Desire to Avoid Sequester
 

Earlier this week, President Obama discussed his desire for Congress to pass a smaller package of spending cuts and tax increases that would delay the sequester for a few more months until Congress can find a way to replace these cuts with a more balanced solution. However, the president did not provide any detailed information of what spending cuts and tax increases he supports.

Meanwhile, Democrats and Republicans in Congress floated some specifics about their plans to avert these cuts. Senate Democratic Majority Leader Harry Reid (D-Nev.) noted that he would like to offset the cuts by closing tax loopholes for the oil and gas industries, companies that move jobs overseas, and corporate jets. House Democrats put forth a legislative proposal to increase taxes on oil and gas companies, a minimum tax on millionaires and billionaires, and lower farm subsidies. Republicans on the House and Senate Armed Services committees unveiled their own proposal based on a 10 percent reduction in the federal workforce through attrition. Last Congress, House Republicans passed a bill that would have replaced the defense cuts in the sequester with cuts to the president's health care law and food stamp program, among other things. At this point, neither side appears close to reaching a deal to avert the sequester.

AGC recently updated its sequestration report, detailing the possible impacts of sequestration on the federal construction market. According to AGC's analysis, sequestration could cut approximately $4 billion federal construction investments in FY 2013 alone. As a result of the two month delay of sequestration enacted by the American Taxpayer Relief Act (the "Fiscal Cliff Deal"), $24 billion in overall federal budget cuts in FY 2013 were averted, leading to the change in initial AGC estimates of over $6 billion in potential cuts to federal construction spending. AGC held a free webinar for members on the possible impacts of the sequestration cuts, including federal construction contracting agencies' possible changes in their contracting behavior. AGC continues to strongly urge Congress and President Obama to enact sensible debt reduction reforms and avert these indiscriminate sequestration cuts.

For more information, please contact Jimmy Christianson at (703) 837-5325 or christiansonj@agc.org. Return to Top

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TRANSPORTATION
House T&I Rail Subcommittee Chair to Address Highway and Transportation Division
 

At AGC’s 94th Annual Convention in Palm Springs, Calif., the Highway and Transportation Division will meet on Friday, March 8 – the session will feature Rep. Jeff Denham (R-Calif.) who will be discussing the outlook for transportation legislation and funding in the 113th Congress.  Rep. Denham is the Chair of the Transportation and Infrastructure (T&I) Subcommittee on Railroads, Pipelines, and Hazardous Materials. In the last Congress, he served as chair of the T&I Committee’s Economic Development Subcommittee. Since Rep. Denham is only starting his second term in Congress, chairing these two important subcommittees is a testament to how highly regarded he is by House Republican Leadership. As a subcommittee chair, he is part of the T&I Committee leadership and included in all of the strategy discussions regarding transportation issues.

Before his election to Congress, Rep. Denham served in the California legislature and worked closely with AGC in the effort to mitigate the impact of the California Air Resource Board’s (CARB) diesel retrofit requirements. Because of California’s unique status under the Federal Clean Air Act, CARB’s rules could have an impact on diesel powered equipment owners in other states.

Please visitAGC’s 94th Annual Convention website for more information. Return to Top

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CBO Report Confirms Highway Trust Fundís Dismal Outlook
 

This week, the Congressional Budget Office (CBO) released its semi-annual estimate of the status of the Highway Trust Fund (HTF) based on revenue flowing in. The CBO also anticipated expenditures based on current law requirements.  CBO estimates that the highway account and the transit account will be able to meet obligations through the end of FY 2014, but will not have sufficient revenue to meet all obligations for FY 2015. CBO points out that this estimate does not include any reduction in the amounts transferred from the general fund to the HTF as a result of MAP-21. 

While the HTF is not directly subject to sequestration on March 1, the general fund revenue that MAP-21 provided for the HTF will be reduced by the sequester.  CBO estimates that the highway account will end FY 2013 with balances of more than $5 billion, and the transit account will end the year with balances of just under $3 billion.

For more information, please contact Brian Deery at (703) 837-5319 or deeryb@agc.org. Return to Top

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Urban Mobility Study Illustrates Cost of Congestion
 

The Texas A&M Transportation Institute’s (TTI) annual Urban Mobility Report was released this week. It details the $121 billion in costs Americans incurred in time and fuel from clogged roads in 2011.  Traffic congestion cost each motorist $818 in 2011 – based on wasted gasoline, lost productivity and increased vehicle maintenance costs.

The report goes on to show that commuters spent an average of 38 hours sitting in traffic congestion during rush hour in 2011, up from 34 hours the year before.  In addition, the Planning Time Index, a measure of travel reliability, compares the time an average trip would take in light traffic to the time the same trip would take during rush hour for major metropolitan cities across the country. Washington, D.C. topped the list with a score of 5.72. For example, for a commuter to arrive at their destination on time during rush hour in Washington, D.C., they would multiply the time of the average trip in light traffic by 5.72.  If a trip typically takes 20 minutes in light traffic, it would take over 2 hours during rush hour.

According to TTI, the methods and measures developed and used in the Urban Mobility Report have been successfully implemented for policy making and prioritizing congestions-mitigating projects. 

AGC will continue to use reports such as the Urban Mobility and TRIP Reports in its education of policy makers about the need for a multi-faceted approach to congestion mitigation but one that focus on new construction and added capacity.

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

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STATE & LOCAL PROCUREMENT
States Looking at Buy American Clauses
 

AGC has received reports from multiple chapters that state legislatures are considering establishing or strengthening their government procurements laws regarding domestic sourcing. Many of these efforts would restrict access to well-established global supply chains and increase the administrative burden on contractors. To certify that products and materials used in the construction process meet requirements, it will often necessitate manufacturer certifications that are difficult or impossible to procure. This is compounded when Buy American legislation defines domestic sourcing in widely varying manners, making it confusing and difficult to comply with. Additionally, these bills may leave the well-established waiver provisions of the federal Buy American laws off the table and currently do not grant access to products from countries we have trade agreements with, as is customary at the federal level.

Chapters facing these law changes can look at AGC’s Buy American website for information on how these laws worked (or didn’t) during the American Recovery and Reinvestment Act (ARRA). AGC also maintains a database of all waivers granted for products that were not in compliance, which highlights exactly how the process was slowed to accommodate domestic sourcing laws.

AGC will continue to assist chapters in analyzing their laws and helping them develop strategies where required.

For more information, please contact Scott Berry at (703) 837-5321 or berrys@agc.org. Return to Top

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CONGRESS
Senator Saxby Chambliss Will Not Seek Re-Election
 

Sen. Saxby Chambliss’ (R-Ga.) surprise decision not to seek a third term will ignite a major firestorm for the Republican nomination. Aside from former presidential candidate Herman Cain and ex-Secretary of State Karen Handel being mentioned as candidates, almost every member of the congressional delegation are at the very least testing the waters to run.

Rep. Paul Broun (R-Ga.-10) became the first official candidate in the open seat race after announcing his Senate candidacy on Wednesday. He should be able to attract strong grassroots and Tea Party support for his effort. Mr. Broun was first elected in a July 2007 special election to replace the late Rep. Charlie Norwood (R), defeating the favored establishment Republican primary candidate.

Conversely, Rep. Lynn Westmoreland (R-Ga.-3), citing his enhanced position within the House leadership, says he will not enter the campaign to succeed Chambliss.

It is possible, however, that a quartet of Republican Congressmen could be part of the eventual GOP field of Senate candidates. Expected to soon follow Mr. Broun's lead is Rep. Tom Price (R-Ga.-6), virtually a certain Senate entry who will likely be the best funded candidate. Reports from both South Georgia and the Atlanta suburbs also suggest that Reps. Jack Kingston (R-Ga.-1) and Phil Gingrey (R-Ga.-11), respectively, will also eventually declare their candidacies. Gingrey says he is now polling the state to test his viability. It is also probable that one or more current or former statewide office holders will also launch a quest for the Senate, making the GOP primary a very crowded affair.

No Democrat has yet to officially declare his or her candidacy, but Atlanta Mayor Kasim Reed is certainly a prospect, though he continually deflects reporters' questions about the subject. Rep. John Barrow (D-Ga.-12) originally said he would not run statewide immediately after Sen. Chambliss announced his retirement, but his name continues to be mentioned among Democratic possibilities without regard to his previous statements.

The Georgia primary is typically held in July, with an August run-off should no candidate receive a majority of the vote. A run-off, if necessary, features the top two finishers within each respective political party. The actual dates will be announced after the state's 2013 elections. If, however, the Georgia election officials follow the same calendar progression from 2012, the primary will be held July 29, followed by an August 19 run-off vote.

For more information, please contact David Ashinoff at (202) 547-5013 or ashinoffd@agc.org. Return to Top

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