Construction Legislative Week in Review
www.agc.org September 26, 2013
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On the Inside
BUDGET
Possibility of Government Shutdown Remains Uncertain
LABOR
OFCCPs New Affirmative Action Rules Effective March 24, 2014
AGC Responds to USACE PLA Inquiry
ENVIRONMENT
New Developments in Clean Water Act Jurisdiction
TRANSPORTATION
Senate Committee Looks at Highway Trust Fund Solvency
TRUCKING
AGC-Supported Bill Passes House
ELECTIONS
Alabama Special Election
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BUDGET
Possibility of Government Shutdown Remains Uncertain
 

Because of the uncertainty of government funding over the next few days, AGC has compiled a Government Shutdown Resource Center that includes information on what contracts will be in jeopardy and which will be unaffected.  The document also gives advice on how to proceed with federal owners if certain approvals may be needed or if there are question about how to bill costs associated with delays caused by the government shutdown.

Congress Remains at an Impasse

Following 21 hours of theatrics on the Senate Floor by Senator Ted Cruz (R-Texas) over defunding Obamacare, the Senate voted to proceed to consideration of the House-passed continuing resolution (CR) by a vote of 100-0.  The House-passed CR included language about defunding Obamacare; however, following the unanimous Senate vote, Majority Leader Harry Reid (D-Nev.) started the process towards amending the House CR and, through Senate procedures, he has ensured that no other Senators can offer amendments.  Votes on the Senate amendments will continue tomorrow and through the weekend.

The Senate CR makes a series of substantive changes to the House-passed CR, including: changing the expiration date from Dec. 15 to Nov. 15, eliminating language that prioritizes certain payments if Congress fails to increase the debt limit and removing the language defunding Obamacare.  The Senate is on schedule to pass their CR on Saturday, if not earlier.  The CR will then head back to the House where its fate is uncertain.

House Republican leaders will have to decide whether to pass the amended bill or send it back with changes.  If the House decides to amend the Senate bill, all 100 Senators would have to unanimously support the House-amended bill in order to get it the President’s desk by midnight on Sept. 30 to prevent a government shutdown.  If the House employs that strategy, there is the potential of a one-week CR that would provide the House and Senate time to pass yet another, longer CR.

The situation is, and will likely remain, very fluid leading up to next Monday.  House Republicans have yet to find consensus regarding an end-game strategy.  It is clear that leadership wants to pass a CR and avoid a shutdown of the government and instead, rally their conservative members for the debt-limit battle.  The House will initiate the battle this week when they will unveil their debt limit legislation.  The debt limit package is expected to include a suspension of the debt limit until the end of Dec. 2014, a one-year delay of Obamacare, tax reform instructions, House-passed energy and regulatory bills (i.e., Keystone Pipeline and Coal Ash) and mandatory spending reforms.  The debt ceiling needs to be raised no later than Oct. 17 according to a letter to Congress from Treasury Secretary Jacob Lew.  The debt limit strategy being employed by the House is opposed by the president who prefers a clean increase and continues to refuse to negotiate over raising the debt ceiling. 

Congress has once again backed itself in a corner and continues its pattern of governing via crisis and short-term extensions.  How these two issues will ultimately be resolved is unclear.  

AGC is joining more than 175 other groups urging the House and Senate to finalize work on a continuing resolution and an increase in the debt limit so that they can deal with the real causes of the country’s long term debt problems. The letter – which will go to all members of the House and Senate tomorrow – says in part, “Congress cannot continue ‘kicking the can down the road:’ it’s time to take corrective action to address the unaffordable path of entitlement spending, to stabilize federal finances and to undertake fundamental tax reform to strengthen the American Economy.”

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

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LABOR
OFCCPs New Affirmative Action Rules Effective March 24, 2014
 

On Sept. 24, the U.S. Department of Labor’s Office of Federal Contract Compliance Program’s (OFCCP) long-anticipated final rules on veterans and individuals with disabilities (IWD) were posted in the Federal Register.  Both rules increase the affirmative action requirements of direct federal contractors and subcontractors.  The agency pre-released each of the final rules in August but announced that they would not go into effect until 180 days after being published. The effective date of both rules is March 24, 2014.  However, for contractors with a written affirmative action program in place at that time, the affirmative action program requirements do not go into effect until the beginning of the next plan year.

Although AGC supports OFCCP’s goals and objectives, AGC is disappointed with the agency’s decision to finalize the two regulations, in particular due to the lack of need for the rules and the costs associated with implementing and complying with the new requirements.  However, after several meetings with government agencies, legislative efforts and press campaigns, AGC persuaded OFCCP to reduce the regulations, as proposed, by more than 50 percent.  While contractors will be required to do more than is currently required, the impact on contractors is minimal compared to what was suggested in the proposed rules.  (For more on the veterans proposed rule, click here.  For more on the disability proposed rule, click here.) 

To learn more about these rules, please click here.

For more information, please contact Tamika Carter at (703) 837-5382 or cartert@agc.org.
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AGC Responds to USACE PLA Inquiry
 

On Sept. 24, AGC sent a letter opposing the possible use of a project labor agreement (PLA) mandate posted U.S. Army Corps of Engineers Alaska District for the FY14 design-build Mechanical-Electrical Building (MEB) construction project at Fort Greely, Alaska.

AGC has sent over 75 letters to federal agencies opposing  PLA mandates and bid preferences during the Obama Administration, most in response to agency announcements that a PLA mandate or preference was under consideration for a particular project or an anticipated set of projects in a particular area. Of those, only one PLA mandate has been issued to date.  

AGC neither supports nor opposes contractors’ voluntary use of PLAs on government projects, but strongly opposes any government mandate for contractors’ use of PLAs. AGC is committed to free and open competition for publicly funded work, and believes that the lawful labor relations policies and practices of private construction contractors should not be a factor in a government agency’s selection process. To view AGC efforts opposing government mandated PLAs, click here.

For more information, please contact Jimmy Christianson at 703-837-5325 or christiansonj@agc.org.
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ENVIRONMENT
New Developments in Clean Water Act Jurisdiction
 

Last week brought three important developments in the ongoing battle over federal jurisdiction of waters of the U.S. in the Clean Water Act. The Environmental Protection Agency (EPA) and the U.S. Army Corps of Engineers (Corps) sent the draft proposed rule on ‘Waters of the U.S.’/Clean Water Act jurisdiction to the Office of Management and Budget (OMB) for interagency review. The proposed rule comes from increased pressure on the agencies to abandon the strategy of issuing non-regulatory guidance to their regional entities interpreting their Clean Water Act jurisdiction. This guidance has been held up in its own interagency review at OMB since 2012. The content of the draft proposed rule is not yet public. It is very likely that this rule will expand federal jurisdiction.

In regards to the aforementioned guidance, OMB’s database officially marked the guidance as withdrawn. EPA has not yet (and likely doesn’t intend to) publicly invalidate the guidance. With the guidance having never been officially finalized, there is nothing to officially withdraw. But the fact that EPA has withdrawn the guidance from OMB consideration means they won’t be pursuing the guidance and the rule simultaneously, which was one of industry’s biggest concerns.

At the same time, the proposed rule went to OMB, EPA release their draft report “Connectivity of Streams and Wetlands to Downstream Waters: A Review and Synthesis of the Scientific Evidence” for public comment. This document contains the scientific review that will support the EPA/Corps assertion of expanded jurisdiction. The report concludes that:

“All tributary streams, including perennial, intermittent, and ephemeral streams, are physically, chemically, and biologically connected to downstream rivers”

“Wetlands and open-waters in landscape … are physically, chemically, and biologically connected with rivers”

Isolated waters “provide numerous functions that can benefit downstream water quality and integrity” but “it is difficult to generalize about their effects on downstream waters from the currently available literature”

These conclusions support the idea that if all waters are connected (or could be connected), then all waters are essentially ‘Waters of the US’ under the Clean Water Act and fall under federal jurisdiction. Rather than completing the review of the science first so that the science properly informs the rulemaking, the public review of this science is happening on a parallel track to the evaluation of the proposed rule by OMB.

AGC will continue to work its industry partners in the Waters Advocacy Coalition to provide the industry reaction to the Connectivity science, and will continue to watch for the publication of the proposed rule.

For more information, please contact Scott Berry at berrys@agc.org or Leah Pilconis at pilconisl@agc.org. Return to Top

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TRANSPORTATION
Senate Committee Looks at Highway Trust Fund Solvency
 

In its continuing effort to lay the groundwork for next year’s need to reauthorize the highway and transit programs, the Senate Environment and Public Works (EPW) Committee held a hearing Wednesday to address the status of the Highway Trust Fund and examine options for providing the revenue needed to keep the trust fund operating. EPW chairwoman Sen. Barbara Boxer (D-Calif.) opened the hearing by reading from a statement submitted by AGC, which highlights the dire situation facing the HTF at the end of FY 2014 – at this point in time, there will be an insufficient balance to allow for new federal funding obligations, again calling for continued support for increasing the traditional motor fuels tax, while allowing for inflation adjustments and identifying new revenue sources. Sen. Boxer suggested that in looking at the idea of replacing the 18.4 cents per gallon tax on gasoline purchases with a sales tax fee paid by oil wholesalers, she believes the option would help close an approximately $20 billion annual shortfall in transportation funding. There was not unanimous support for this idea among Committee members present and Senator Boxer pointed out that this decision is in the hands of the Senate Finance Committee, but is a concept she will encourage the committee to look at.

The hearing included an industry panel that uniformly pointed out not only the need to raise the needed revenue, but to do it quickly to avoid program disruptions next year. A second panel included testimony from members of two commissions established to look at the future of the federal transportation programs and how to fund them. Panelists Jack Schenendorf and Kathy Ruffalo both called for the need for Congress to continue the user pay system that has been so successful in the past. Schenendorf said a 25- to 40-cent per gallon gas tax increase is necessary to start meeting future needs. Also on this panel was Virginia’s Secretary of Transportation Sean Connaughton, who talked about the state’s success last year to increase transportation funding, which included a change in the collection of user-fees similar to the idea suggested by Sen. Boxer.

Senator Max Baucus (D-Mont.), a member of the EPW Committee, but also chair of the Finance Committee, said he hoped to address increasing the federal gas tax or finding other ways to raise revenue for highway and transit programs as part of the tax reform effort his committee will be taking up. He said that including this as part of a larger bill might increase its chances of success. Sen. Baucus said his goal is to move a comprehensive tax reform bill later this year.

For more information, please contact Brian Deery at (703) 837-5319 or deeryb@agc.org
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TRUCKING
AGC-Supported Bill Passes House
 

AGC joined several of their colleagues in the trucking and bus industry in supporting H.R. 3095, a bill that will ensure that any action taken by the Federal Motor Carrier Safety Administration (FMCSA) regarding obstructive sleep apnea among commercial truck and bus drivers may occur only after a formal rule making process.  The bill passed the House by a vote of 405-0 and now heads to the Senate.

The bill is necessary because FMCSA has been considering sleep apnea through “regulatory guidance,” which doesn’t ensure due process for companies that employ drivers with Commercial Driving Licenses.  Formal rulemaking will ensure the process considers the views of stakeholders and the medical community on the best screening, testing, and treatment methods.

AGC will continue to work with our trucking and bus colleagues to ensure FMCSA proceeds only through a formal rulemaking process.

For more information, please contact Sean O’Neill at (202) 547-8892 or oneills@agc.org
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ELECTIONS
Alabama Special Election
 

Alabama voters went to the polls in the first of three elections to choose a successor to resigned Rep. Jo Bonner (R) last night, who departed the House in August to accept a position at the University of Alabama. The end result met predicted expectations, as Democratic former state Representative candidate Burton LeFlore easily won his low turnout primary with 70 percent of the vote. He now awaits the winner of the Nov. 5 Republican run-off.

Of the nine GOP candidates, two will advance: former state Senator and gubernatorial candidate Bradley Byrne (35 percent) and businessman and former congressional candidate Dean Young (23 percent).

The remaining seven candidates, three of whom ran significant campaigns, are eliminated from further competition. State Rep. Chad Fincher placed third with 16 percent, conservative columnist Quin Hillyer was next at 14 percent, and former Republican National Committee deputy chief of staff Webb Griffith finished fifth, garnering 11 percent. The remaining four candidates all pulled less than 400 votes.

The special election turnout rate was relatively low, but Republicans dominated among the voters who did participate. Almost 52,000 people cast ballots in the GOP election versus just 4,300 for the Democrats. The eventual Republican nominee will be a heavy favorite in the Dec. 17 special general election.

Though Mr. Byrne finished first last night, he is by no means guaranteed to win the run-off. In fact, he was in an identical position in the 2010 Governor's campaign, but failed to secure the nomination in the subsequent head-to-head battle.

Three years ago, Mr. Byrne placed first in that primary, too, but fell in the run-off to now-Gov. Robert Bentley by a relatively stiff 56-44 percent margin. Interestingly, Mr. Bentley only secured second place by a 166-vote spread in the statewide contest. We'll see on Nov. 5 whether the first-place qualifier breaks the majority barrier or if history will repeat itself.

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