Construction Legislative Week in Review
www.agc.org December 5, 2013
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On the Inside
FEDERAL CONTRACTING
AGC Testifies Before House Committee on Design-Build Reform
AGC-Supported Small Business Amendment Introduced
WATER RESOURCES
WRDA Conference Committee Underway
ACTION NEEDED: Urge Your Representatives to Support the Creation of a Water Infrastructure Trust Fund
BUDGET
Budget Conference Update
TRANSPORTATION
Gas Tax Increase Introduced in the House
DOT Releases Regulatory Agenda
LABOR
Congressional Hearing Held on OFCCP Affirmative Action Rules
AGC Responds to USACE PLA Inquiry
Labor Department Updates Regulatory Agenda
BUSINESS
House passes Bill to Block Patent Trolls
U.S. Small Business Administration Releases Regulatory Agenda
AGC EVENTS
2014 AGC Financial Issues Forum
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FEDERAL CONTRACTING
AGC Testifies Before House Committee on Design-Build Reform
 

On Dec. 3, AGC Naval Engineering Facility Command Committee Chair Randall Gibson—president of a federal small business, Whitesell-Green, Inc., in Pensacola, Fla.—testified before the House Oversight and Government Reform Committee on the federal government’s use of design-build contracting. In his testimony for the association, Mr. Gibson addressed the need for federal agencies to: (1) reasonably limit one-step design-build procurements; and (2) reasonably limit the second step of the two-step design-build process to three to five finalists.

On one-step design build procurements, design-build teams have no way to judge their prospects for success, as no team can be sure how many total teams are pursuing the project. Consequently, competition suffers because many qualified teams, especially small businesses, choose not to incur the large proposal costs to participate where perhaps 20 teams or more can offer. During the two-step design-build procurement process, where a federal agency can select an unlimited number of finalists to enter the second step of the competition and submit full proposals with more complete—and more expensive—design materials and cost estimates,  the inability of contractors to determine the odds of success tends to reduce competition.  

As such, at the hearing, AGC articulated its general support for H.R. 2750, the Design-Build Efficiency and Jobs Act of 2013, introduced by Rep. Sam Graves (R-Mo.), which would both limit single-step design-build procurements and limit the second step of the two-step design-build process to three to five finalists. AGC will continue to work with the committee and other members of Congress to ensure that the construction industry’s priorities in this bill advance through the legislative process.

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

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AGC-Supported Small Business Amendment Introduced
TAKE ACTION: Urge Your Senators to Support Counting Lower-Tier Small Businesses
 

Sens. Chris Coons (D-Del.) and Roger Wicker (R-Miss.) recently introduced an AGC-supported small business reform amendment to the National Defense Authorization Act for FY 2014, S. 1197.  The Senate could vote on the amendment as early as next week, so please take action now and urge your U.S. Senators to support the Coons/Wicker Amendment #2286 to S. 1197.

If enacted, the amendment would allow prime contractors to count lower-tier small business subcontractors towards their small business goals. The current law only allows prime contractors to count first-tier small business subcontractors towards the goals. This simple change will encourage prime contractors to make sure small businesses have opportunities to compete for subcontracts at every tier, thereby allowing more opportunities for small business growth.

The House of Representatives previously approved by unanimous consent a similar amendment to its version of the NDAA bill in June.  Again, please take action now and urge your U.S. Senators to support the Coons/Wicker Amendment #2286 to S. 1197.

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

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WATER RESOURCES
WRDA Conference Committee Underway
AGC Continues to Advocate for the Construction Industry’s Priorities
 

On Nov. 20, select members of the House and Senate—called conferees—gathered to begin work on resolving the discrepancies between the two chambers respective Water Resources Development Act (WRDA) bills in a conference committee. AGC has been active throughout the WRDA legislative process and advocated for the construction industry’s WRDA priorities in a letter to all conferees, detailing which provisions and policies in both bills should be included in a final WRDA bill.

In both its letter and continuing lobbying efforts, AGC articulates the need for:

  1. An adequate and efficient project authorization process;
  2. Spending harbor maintenance tax revenues on harbor maintenance;
  3. Addressing the Olmsted Locks and Dam project in a way that allows other necessary inland waterways projects to proceed;
  4. Environmental streamlining and project delivery acceleration through limiting the time to file lawsuits on projects under the National Environmental Policy Act and setting firm deadlines for pre-construction project studies; and
  5. Innovative financing methods—including a public private partnership pilot program and Water Infrastructure Finance and Innovation Authority—that supplement, not replace, traditional government funding for water resources infrastructure.

The House passed its WRDA bill in October by an overwhelming 417-3 vote. The Senate also passed its version of the bill in May on an equally impressive bipartisan 83-14 vote. During their conference meeting, the only legislative issue of some controversy was the environmental streamlining provisions. The conference committee is expected to last a number of weeks. Reports indicate that final passage on a WRDA bill could come as early as mid-December. Visit AGC’s Legislative Action Center and ask your members of Congress to support the construction industry’s priorities for the WRDA Conference.  AGC will continue to advocate for the construction industry’s legislative priorities as conferees continue their discussions.

For more information, please contact Jimmy Christianson at (703) 837-5325 or christiansonj@agc.org. Return to Top
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ACTION NEEDED: Urge Your Representatives to Support the Creation of a Water Infrastructure Trust Fund
 

In mid November, Rep. Earl Blumenauer introduced a bipartisan, AGC-supported piece of legislation that would create a water infrastructure trust fund designed to supplement the Clean Water State Revolving Fund (CWSRF) with additional capitalization. Please take action now and urge your Representatives to cosponsor and support H.R. 3582, The Water Trust Fund Act of 2013.

If enacted, the bill would create a water infrastructure trust fund capitalized by voluntary contributions from products that rely on clean water or impact the wastewater stream. Companies that opted-in would direct a 3-cent per container fee to the trust fund. Eighty-five percent of this revenue would be directed as additional capitalization for the CWSRF, with the remaining fifteen percent directed to a new innovative water infrastructure financing mechanism based on the popular TIFIA program for surface transportation infrastructure. In return, these companies would be able to affix an official seal or logo to their product that explains how purchase of this product contributes to America’s clean water.

Tell your Representatives that you support more funding for wastewater infrastructure construction and to cosponsor and support H.R. 3582, The Water Trust Fund Act of 2013.

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

With no public meeting of the House and Senate budget conference this week, House Budget Committee Chairman Paul Ryan (R-Wis.) and Senate Budget Committee Chairwoman Patty Murray (D-Wash.) continue to meet behind the scenes to craft a limited budget agreement they can unveil by early next week and have Congress pass before their Dec. 13 deadline.

Details of the limited deal have been reported to include an agreement on top-line discretionary spending for fiscal years 2014 (approximately $1 trillion) and 2015 (slightly above $1 trillion) and addressing the sequestration cuts in 2014 and 2015.  In order to achieve a limited deal, Ryan and Murray are going to have to find offsets without tax increases or cuts to entitlement spending.   Even if agreement can be reached on the offsets, Chairman Ryan will have a challenge in selling the deal to conservatives who are concerned that it will increase spending over the current $967.5 billion level and does nothing to address entitlement spending.   

AGC is encouraged by the possibility of a two-year budget deal that would allow for a return to regular order for an appropriations process that has completely broken down over the past three years.   AGC continues to meet with members of the conference committee to encourage that any final budget deal acknowledges the need to provide additional revenue in the Highway Trust Fund.

For more information, please contact Sean O’Neill at (202) 547-8892 or oneills@agc.org. Return to Top
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TRANSPORTATION
Gas Tax Increase Introduced in the House
AGC CEO Encourages President Obama to Offer HTF Solutions
 

On Wednesday, AGC and other transportation stakeholders joined in support of Oregon Democrat Congressman Earl Blumenauer as he introduced his bill H.R. 3636, the Update, Promote, and Develop America’s Transportation Essentials Act (UPDATE Act) at a press conference at the Capitol.  The bill would phase-in a 15 cent gas tax increase starting in 2014, indexes the gas tax to inflation, and then confirms Congress’s intention to replace the gas tax with a more equitable, stable source of funding by 2024.

Although getting the bill to become law is a herculean task, Congressman Blumenauer has started the conversation – Congress and the administration now need to take on the difficult task of finding the revenue necessary to fill the projected annual $15 billion hole facing the Highway Trust Fund in the coming months.   In regards to the bill, AGC CEO Steve Sandherr issued the following statement: “This proposal provides the kind of long-term funding solutions that virtually every commission, including Simpson-Bowles, has said are needed to repair and upgrade our aging transportation network, what the Congressman understands is that simply talking about the need to find new sources of revenue won’t help until we actually identify, support and enact them.”

A top priority of AGC is to ensure the pending insolvency of the Highway Trust Fund is addressed in a responsible fashion and we are committed to work with Congressman Blumenauer and others to find the revenue necessary to avoid the transportation funding cliff facing federal highway and transit programs in 2015.  AGC encourages our members to contact their Representatives and Senators to let them know of the troubles facing the Highway Trust Fund.  More information can be found on AGC’s Legislative Action Center.

Also this week, AGC CEO Steve Sandherr sent a letter to President Obama asking him to include revenue option to avoid the upcoming insolvency of the Highway Trust Fund in the administration‘s fiscal year 2015 budget.  To date, the administration has yet to put forth a workable solution to the revenue challenges facing federal highway and transit programs.   AGC feels that it is crucial for the president and Congress to show leadership on this issue and we are committed to working with them to identify a sustainable revenue source for the Highway Trust Fund.

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

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DOT Releases Regulatory Agenda
 

The Department of Transportation (DOT) released its semi-annual regulatory agenda last week, which gives a status report on a number of pending rules and regulations the agency is working on. During fiscal year 2014, the Federal Highway Administration (FHWA) will continue to focus on creating national performance measures and standards to meet the national transportation goals identified in MAP-21.  Specifically, FHWA will initiate rulemaking on national goals and performance measures for safety; bridges and pavement; congestion reduction, CMAQ; freight; and interstates and the national highway system.

Once again, DOT has placed a final rule altering the application of the Disadvantaged Business Enterprise (DBE) program on the long-term agenda. DOT issued the notice of proposed rule-making in September 2012 and recommended only minor changes to the rule. AGC provided extensive comments and generated 125 letters, including comments from 18 AGC chapters, pointing out the significance of the rule changes.  This led DOT to change their definition of the rule from minor to significant, which has resulted in delaying the release of the final rule.

For more information, please contact Sean O’Neill at (202) 547-8892 or oneills@agc.org Return to Top
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LABOR
Congressional Hearing Held on OFCCP Affirmative Action Rules
 

On Dec. 4, the House Education and Workforce Subcommittee on Workforce Protections held a hearing on the new affirmative action regulations for veterans and individuals with disabilities.  The new regulations were recently promulgated by the U.S. Department of Labor’s Office of Federal Contractor Compliance Programs (OFCCP). The hearing included testimony from OFCCP’s director, Pat Shiu, and directly focused on the new rules which go into effect on March 24, 2014.

Although AGC supports OFCCP’s goals and objectives of ensuring equal employment opportunity, AGC is disappointed with the agency’s decision to finalize the two regulations, in large part 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 is minimal compared to what was suggested in the proposed rules.

AGC provided material that was inserted into the congressional record for the hearing.  

A summary of the final rules can be found on the AGC website.  For a recording of AGC’s webinar highlighting key factors of each rule for construction contractors, visit the AGC bookstore.

For more information, please contact Jim Young at (202) 547-0133 or youngj@agc.org Return to Top
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AGC Responds to USACE PLA Inquiry
 

AGC recently sent a letter opposing the possible use of a project labor agreement (PLA) mandate posted by the U.S. Army Corps of Engineers Baltimore District for large scale construction projects (greater than $25 million) within the Baltimore-Washington corridor.

AGC has sent over 80 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. Return to Top

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Labor Department Updates Regulatory Agenda
 

Last week, the U.S. Department of Labor (DOL) released its Semiannual Regulatory Agenda – Fall 2013. The agenda provides a good indicator of issues the agency wants to address in the near future, however, often times the agencies do not adhere to the target dates listed. The agenda highlighted nearly 70 rules that they plan to address in the next 12 months along with 6 long-term regulatory efforts not expected to be considered in the next year. Many of the items have a significant impact on the construction industry and AGC will be providing comments where appropriate. An overview of some of the most significant items for the industry include:

Occupational Safety and Health Administration (OSHA)

  • Reporting of Workplace Injuries and Illnesses: On Nov. 7, 2013, a proposed rule was issued to amend its current recordkeeping regulations to require the electronic submission of injury and illness information.  The proposed rule would require construction firms with more than 250 employees to electronically submit detailed records on a quarterly basis to OSHA, which would then be made available to the public online. OSHA is also proposing that firms with 20 - 249 employees be required to submit only their summary of work-related injuries and illnesses once a year. AGC knows that OSHA already has access to this data during an inspection. However, we are concerned about potential problems with the public dissemination of this information. Our concerns include identifying who is responsible for any website inaccuracies; the possible failure to sanitize personal data of employees from the records; how data will be characterized by competitors; and the possible misinterpretation of data by people lacking the construction expertise to evaluate the specifics of a reported incident. The comment period ends in February 2014 however the agenda did not provide any greater detail on the timeline for the rule.
  • Injury and Illness Prevention Program (I2P2): A proposed rule is expected in September 2014 that would require employers to implement and frequently update an Injury and Illness Prevention Program to address safety and health hazards, beyond those currently regulated.  OSHA currently has voluntary Safety and Health Program Management Guidelines. AGC has encouraged OSHA to remove the requirement that companies develop company-wide safety programs to address these unregulated hazards. Instead, AGC has recommended that OSHA provide simple guidelines to employers to develop and implement an effective safety and health program that focuses on the regulated hazards that are significant threats in the workplace.
  • Occupational Exposure to Crystalline Silica: On Oct. 25, it was announced that the public comment period on its proposed rule is extended by 47 days – to Jan. 27, 2014. AGC submitted a request to extend the deadline by 90 days in order to best respond to the proposed rule’s 87 detailed questions. This extension now allows AGC to work with its members to properly formulate an effective response. AGC is also working with a coalition of nearly two dozen construction industry trade associations that represent all facets of the industry to craft a response to the proposed rule. AGC has numerous concerns with the rule, which, as it stands, would reduce the permissible exposure limit (PEL) to airborne crystalline silica in half. AGC’s preliminary analysis of the rule reveals that complying with the rule is neither technologically or economically feasible; control methods outlined in the rule contradict existing safety practices in the industry; and OSHA has failed to detail how the new requirements would reduce illnesses. The industry has made significant progress in the last four decades in preventing silica-related disease under existing regulations and AGC believes the real problem is the failure to achieve compliance with the current PEL. Correcting that failure should be the focus of OSHA's efforts and will likely achieve the best results. AGC is soliciting input from members on the compliance costs and regulatory burdens the new rule would place on the industry. For more information on the proposed rule and to provide input to AGC, please visit the AGC website.
  • Confined Spaces in Construction: A final rule is expected in February 2014 for confined space.
  • Crane Operator Certification: A proposed rule is expected this month as a follow-up to the requirements for crane and derricks used in construction. The separate rulemaking is a result of requirement to have crane operators certified by November 2014 and the responses from the industry that the rule would provide problems and limitations with the process. The possible rulemaking on operator qualification would extend the enforcement and certification of operators by three years.

Office of Federal Contract Compliance Programs (OFCCP)

  • Construction Contractors' Affirmative Action Requirements: A proposed rule is expected in April 2014 that would establish a new method for meeting affirmative action goals and requirements for minorities and women in construction – the first change to the process since 1980.
  • Compensation Data Collection Tool: In 2010, OFCCP announced that it is working on a Compensation Data Collection Tool to identify contractors violating sex and race-based compensation discrimination laws. AGC submitted comments explaining why the use of a tool such as this one should be modified or not required at all.  The new agenda doesn’t list the issue as a priority, but suggests details about the tool will emerge in January 2014 in the form of a notice of proposed rulemaking, hopefully with AGC’s suggested modifications.

Office of Labor Management Standards (OLMS)

  • Persuader Agreements: A final rule is expected on the Persuader rule in March 2014. The rule would limit the “advice” exception under the Labor-Management Reporting and Disclosure Act so that all consultation with labor lawyers and/or consultants will be subject to disclosure to DOL.  This rule will significantly impact employers’ ability to retain counsel. 

Wage and Hour Division (WHD)

  • Right to Know: Listed under a long-term action on their agenda, the Right to Know regulation would require employers to provide written notice to all workers defining their classification status as an independent contractor or employee. In addition, the anticipated regulations would require written notification of an employee’s classification as exempt or non-exempt, and detail the decision factors used to make the determination. No timeline for the regulation was listed in the agenda, but remains in WHD’s long-range planning schedule.

The agenda also includes the priorities for independent agencies:

National Labor Relations Board (NLRB)

  • Quickie Elections: The NLRB only listed one long-term action on their agenda – the Quickie Election rule, which would compress the time frame between a call by a union for a vote over union representation and the election. The rule as initially finalized in 2011, but legal challenges prevented the rule from becoming effective. Now that the NLRB is operating with a full board, it’s expected that they again could finalize the rule; however, no date has been announced.

For more information, please contact Jim Young at (202) 547-0133 or youngj@agc.org Return to Top

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BUSINESS
House passes Bill to Block Patent Trolls
 

This week, the House of Representatives passed H.R. 3309, the Innovation Act.  This bill aims to block abusive patent litigation. The bill enjoys bipartisan support; it passed the House by a vote of 325-91 and passed the Judiciary Committee by a vote of 33-5.

The subject of hearings and public input in the House, this bill was developed to target “patent trolls” and also to protect legitimate patents. The bill will discourage patent trolls by requiring more specific pleadings from companies asserting patent infringement, including the name of the party who benefits from the litigation, the specifics of the patent in question, the specific products that allegedly infringe on the patents and what processes infringe on these patents.  It also allows judges to stay individual user suits when the manufacturer is pursuing parallel litigation against the patent holder and make it easier to collect fees from companies that have abused the system (forces the loser to pay the winner’s legal costs).

There are currently three versions of the bill in the Senate.

For more information, please contact Jeff Shoaf at (202) 547-3350 or shoafj@agc.org Return to Top

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U.S. Small Business Administration Releases Regulatory Agenda
 

Last week, the U.S. Small Business Administration (SBA) also released its statement of regulatory priorities for the next year. Of those priorities, federal construction contractors should be most interested in SBA’s desire to release regulations that would extend the availability of mentor-protégé programs to all small business concerns. SBA currently has a mentor-protégé program for the 8(a) Business Development Program that is intended to enhance the capabilities of the protégé and to improve its ability to successfully compete for Federal contracts. The various types of assistance that a mentor will be expected to provide to a protégé include technical and/or management assistance; financial assistance in the form of equity investment and/or loans; subcontracts and/or assistance in performing prime contracts with the government in the form of joint-venture arrangements.

For more information, please contact Jimmy Christianson at (703) 837-5325 or christiansonj@agc.org Return to Top
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AGC EVENTS
2014 AGC Financial Issues Forum
Jan. 9-10, 2014 | Miami, Fla.
 

Join AGC member company CFOs, CEOs and other senior accounting professionals for theWinter 2014 AGC Financial Issues Forum (formerly the AGC Tax and Fiscal Affairs Meeting). The conference will feature in-depth discussions with fellow contractors, congressional and administration representatives and AGC staff, and delve deep into the latest financial and accounting issues impacting the construction industry. Confirmed speakers include senior staff from FASB's parent organization, former staff director of Ways and Means, author of Showdown at Gucci Gulch, and tax accounting experts from around the country. In accordance with NASBA standards, attendees are eligible to earn up to 10 CPE credits. Learn more and register here.

For more information, please contact Brian Lenihan at (202) 547-4733 or lenihanb@agc.org Return to Top

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