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AGC REPORT STEPHEN SANDHERR CEO FEBRUARY 6, 2014 LEGISLATIVE ACTIVITY CURRENT POLITICAL ENVIRONMENT • Partisanship will govern: election year • Tea Party influence in GOP restricts us • Mainstream GOP fears primary challenges • Devolution gaining foothold w/conservatives • Congressional agenda will be thin • Senate: protect Dems from tough votes • House: oversight/highlight health care failure • Aggressive regulatory agenda HIGHWAY FUNDING • Sounding alarm bells on HTF: broke in 2014? • • • • • Immediate problem: sequester cuts from GF transfer CBO: need $15B/yr to remain whole Received $ 56B in general fund $ last 5 years Met w/ 70+ Senate offices to gauge support Identifying additional sources of revenue • Increase gas tax (budget/tax reform/reauthorization) • Royalty on energy extracted on federal land • Repatriation of foreign corporate profits REAUTHORIZATION CHALLENGES • Senate: MAP-21 was a 2 year funding bill/6 year policy bill • Boxer gave blood on environmental/policy reforms • House: need to demonstrate taxpayer ROI to get GOP support for more $ • Shuster has primary challenge May 20 which restricts window of opportunity WHAT IS AGC DOING? • Working with coalition partners (other construction assns, USCC, building trades) • Enlisting general business support (BRT, NAM, retail groups, travel industry, truckers, etc.) • Door to door lobbying • Public relations: central message in press activities • SOTU: infrastructure message WATER INFRASTRUCTURE • FY 2014 Appropriations are flat • Clean Water Trust Fund remains priority • Private Activity Bond bill introduced: lift caps • Potential to add $2-6 B to financing • Tax free munis WRDA • Authorizes new port, flood control & environmental projects • Senate bill got 78 votes • House passed 417-3 • Reprograms $ to address current needs • Streamlines project review process • Requires HMTF spending • Trial run for Shuster and Boxer IMMIGRATION REFORM • AGC principles: • • • • • • • Earned legalization for existing workers (10 YRS) Workable guest worker program/future flow No vicarious liability Maintain “knowing” standard Limit debarment as penalty/keep FAR stds Federal preemption E-verify for new hires • Senate bill meets most except guest workers POLITICS OF IMMIGRATION REFORM • Senate: 14 GOP votes • Recognition that system broken • Demographics not favorable • GOP rhetoric unwelcoming • House GOP not anxious to move • House GOP principles unveiled last week • Not political winner (fear of primary challenge) • Don’t trust Obama on enforcement MULTIEMPLOYER PENSION REFORM • AGC participated in multi-year, multi-industry commission to address MEPP solvency • Resulted in “Solutions Not Bailouts” plan to push legislation • Gives tools to improve financial status: • Move to “hybrid” plan • Permits benefit reductions for beneficiaries • Political challenge on benefit reduction • AGC working w/BCTD on PR & lobbying OTHER LEGISLATIVE ISSUES • Counting lower tier subs • Passed by voice vote in defense authorization • AGC will monitor regulatory implementation • Tax Reform • • • • Effective construction tax rate is 31% Fair Effective Tax Coalition Corp & personal rates simultaneously reduced Address infrastructure: HTF, INWTF, PABs, BABs, tax free munis REGULATORY ACTIVITY OFCCP DISABILITY/VETS RULES • Rules require additional GFE’s to hire/promote veterans and disabled • Original proposal had numerous costly and burdensome requirements • AGC made 37 significant changes after demonstrating that audits of federal contractors yielded no pattern of discrimination: <0.1% AGC MITIGATED DAMAGE • • • • • • • • Limited records kept from 5 yrs to 3 OK to reference not print clause in contracts Periodic not annual review of job descriptions No annual mtg; only train HR & hiring officials No need for 3 linkage agreements/show GFE 2% sub goal for severely disabled removed Can identify protected class if known/evident Vets benchmark can be nat’l avg (now 8%) DOT DBE REGS • “Listening session” held in December • DBE’s submitted in bid w/ $ amount & scope w/ written confirmation by DBE or no pay • State DOT must give written consent to change • GFE (detailed in writing) to replace w/ DBE • Price not determinative of goal • GFE documentation submitted w/bid if goal short (include all sub quotes) DOT DBE REGS • States must include in contracts that failure to carry out DBE commitments=material breach • DOT now considers this “significant” rule • AGC met w/DOT • Make program work • Reduce/eliminate inconsistencies • Permit mentoring • DOT doesn’t believe submitting bid info is problematic OSHA SILICA RULE • 8/23 OSHA released highly anticipated rule • New PEL of 50 micrograms/m3 (current is100) • Employers conduct initial/periodic exposure assessments of workers/air sampling • Engineering/work practice controls/PPE • No cost medical surveillance for employees exposed to levels >PEL for 30+ days/year • AGC created construction coalition EPA WETLANDS RULE • EPA seeking to expand definition of “navigable waters of US” under Clean Water Act • USSC: CWA jurisdiction can’t be based on proximity to “navigable water” but confusion on limit • EPA: all tributary streams incl. perennial, intermittent, and ephemeral are physically, chemically & biologically connected • Impact on permits: dredge, stormwater, oil spill ELECTION OUTLOOK • GOP should retain House • Senate in play for 3rd straight cycle • • • • • Dems defending 7 seats in states Romney won NC, LA, MT, SD, WV, AR, AK GOP needs net gain of 6 seats GOP: 2 tough elections: GA and KY Does Obamacare expand playing field? • CO, MI, IA, VA, NH INDUSTRY ISSUES WORKFORCE DEVELOPMENT • AGC survey conducted last year • 74% difficulty finding craft workers • 53% difficulty finding non-craft workers • AGC efforts • • • • Go Build Alabama/Georgia etc. Build Wisconsin VP task force on Apprenticeship/Job Training AGC Workforce Development Plan: what policy changes can we push at national level? AGC WORKFORCE DEVELOPMENT PLAN • Immigration reform • Modernize Perkins Act • Give states flexibility to select training designed to meet workforce needs • Give states autonomy to pursue sector partnerships • Improve Workforce Investment Act • Allow apprenticeship programs to be designated as “Eligible Training Providers” so students can use Individual Training Accounts to pay for tools/supplies AGC WORKFORCE DEVELOPMENT PLAN • Remove anti-trust barriers for non-union plans • Encourage partnerships between apprenticeship plans & community colleges • Offer community college & tech education to HS students for free (Kansas) • Make it easier to establish construction charter schools ?