Status of Major Legislation 106th Congress -- First Session

TAXES

Tax cuts are again a priority for the GOP Congressional leadership but the roadblock to significant reductions still remains in the White House. The House has already approved legislation to eliminate the marriage penalty and is expected to follow with bills encouraging education savings accounts, investment in poor communities and eliminating means testing for Social Security benefits. Death tax legislation is also a strong candidate either as a stand-alone bill or as part of a package of cuts. The single bill strategy may be unworkable in the Senate as 60 votes would be needed to avoid a filibuster. Also, Senate bills can be readily amended which leads to the problem of a "Christmas tree" bill - one that becomes bogged down by too many amendments. Also in the way is President Clinton who has already spoken against the GOP marriage penalty bill as well as any other tax bill outside a larger agreement on the budget. The President will remain a formidable obstacle, particularly if tax reduction continues to remain a low legislative priority for the American public.

MANAGED CARE REFORM

Expect heated, partisan debate over the future of managed care to continue this year. In July of last year, the Senate passed managed care reform largely free of provisions that will increase premiums or expose employers to legal liability for health care decisions. The House-passed bill would allow patients to sue their HMOs for delayed or denied coverage, and expose employers to liability. The Senate bill does not include either provision. Senate Majority Whip Don Nickles, a key player in this conference, adamantly opposes the liability provision. The conference committee begins early this year but will likely be long and tempestuous.

PUBLIC WORKS AND TRANSPORTATION ISSUES

Aviation: The debate over the Airport Improvement Program (AIP) resumed when Congress returned in January. The first session of the 106th Congress ended with a stalemate over aviation funding. Chairman Shuster (R-PA) is continuing his mission to guarantee that all aviation revenues are spent on aviation, and that Congress maintains the general fund contribution to aviation programs. AGC is leading the construction industry's efforts to help achieve Shuster's objective. Senate Budget Chairman Pete Domenici (R-NM) is the primary obstacle to changing the budgetary treatment of aviation spending. Senator Domenici and a majority of the Senate conferees oppose any special budget treatment for aviation programs.

Retainage: AGC is continuing to work with the U.S. Department of Transportation and Congress to place a moratorium on the new DOT retainage policy contained in the new DBE regulations. The new regulation pertaining to prompt pay requires prime contractors to pay the subcontractors their retainage once the subcontractors work is satisfactorily completed. This change does not require the state to pay the prime their retainage earlier, nor does it require the state to give "final approval" to the subcontractors' work. AGC is leading the construction industry's efforts to have DOT place a moratorium on this portion of the new regulation until industry, state, and DOT can develop a workable policy on retainage. 

Preserve the Promise of TEA-21: TEA-21 guaranteed that spending on the highway program would be linked to the amount of gas taxes collected in the Highway Trust Fund. This year, gas taxes were $3.058 billion higher than estimated in TEA-21. President Clinton's fiscal year 2001 budget proposal includes the additional revenue, however, he diverts $1.3 billion of the additional funding to his favorite programs including $468 million for inner-city passenger rail (Amtrak) and $50 million for the Federal Transit Administration's Job Access and Reverse Commute program. AGC will lead industry efforts, as we did last year, to ensure that the funds are distributed as TEA-21 directs.

ENVIRONMENTAL ISSUES

Legislative: For the 106th Congress new Senate Environment and Public Works Committee Chairman, Senator Bob Smith (R-NH), has outlined the committee's agenda for this year. Topping the agenda is a reauthorization of the Resource Conservation and Recovery Act (RCRA) that monitors chemical use and storage from "cradle to grave." Other issues include reform and reauthorization of Superfund, Everglades, and Water Resources Development Act. The Build a Better America Caucus has placed brownfields legislation - formerly used industrial redevelopment - legislation on the agenda.

Legislation to fix current implementation of the Clean Air Act after adverse court rulings will be debated. S. 1053, legislation to provide a "grandfather" provision to the Act has been sent to the Senate floor, but Democrats have announced their intention to introduce their own version. In Environmental Defense Fund v. EPA, the court halted an EPA practice of "grandfathering" projects once the project had been approved and met air quality standards. Now, if an area fails to meet air quality standards all highway projects must stop. S. 1053 would allow projects to continue in the event of a conformity lapse if the projects received National Environmental Policy Act (NEPA) approval two years prior to the lapse, if federal funds had been obligated or committed.

Regulatory: EPA proposed stringent "total maximum daily loads" for individual watersheds, and is requiring the states to inventory watersheds for pollutants. This controversial proposal would also require states to amend the storm water Construction General Permit to require nonpoint source offsets by construction contractors. Congress is holding hearings on this controversial proposal. 

Legal: EPA is appealing to the Supreme Court a case limiting EPA's authority to set emission standards on particulate matter and ozone (American Trucking Association v. EPA). Another case pending could eliminate EPA's oversight of a state's enforcement actions if the state has taken control or delegation of the program (Harmon Industries v. Browner). AGC's Missouri chapters have been granted intervenor status in Sierra Club v. Browner, a clean air act case.

HUMAN RESOURCES POLICY 

The Congress and the business community will spend much of the next session playing defense. The Administration has proposed a number of complex new regulations and standards (e.g. ergo, safety and health programs, and record keeping revisions) that have contractors concerned. In addition, AGC will play an active role in studying the ongoing labor shortage and various proposals to address this issue. AGC will focus on increasing congressional oversight and keeping contractor concerns before the Congress.

Ergonomics: AGC and its employer allies at the National Coalition on Ergonomics successfully pressed Congress to support extending the comment period for this complex new rule, published in November 1999. More than seventy Members of Congress and Senators wrote to Labor Secretary Herman to ask that the comment period be extended. After weeks of defensive maneuvers, OSHA did finally relent and agree to postpone the deadline. Written comments for OSHA's proposed ergonomics standard were originally due February 1st, but now must be submitted no later than March 2, 2000. Hundreds of AGC Members wrote directly to OSHA asking for this extension. In addition, AGC's model comments made available in January are focused on defending the need to exempt construction from this onerous policy. We expect that several AGC members will testify at the scheduled hearings this spring and others to provide formal written comments to OSHA on the ergonomics proposal. There is still a remote possibility that the Senate could consider S.1070 "the SENSE Act." But, even if Congress approves the bill, the president is committed to vetoing it. 

S & H Program Standard: OSHA leaders have indicated that the next new regulation proposed could be the Safety and Health Program standard. It could be published any day. While AGC was successful in creating a study and pilot project on model voluntary programs, OSHA may still seek to mandate an ambiguous standard that will be a nightmare for contractors. Unlike the ergo regulation, this standard will include every industry. AGC has been meeting with Members of Congress and key staff members about this issue for more than two years. Congressional hearings in the year ahead are also likely.

Unemployment Insurance Laws: Another issue likely to be considered by the Congress next year, is the President's proposal to rewrite the unemployment insurance laws in every state to permit paid family and medical leave. This controversial move is sure to be taken up by the Congress because the governors and state legislatures are very concerned about it. AGC will monitor this continuing effort.

Labor Shortage: The construction industry in most parts of the county is faced with a serious and sustained labor shortage. The demand for skilled construction labor has outpaced supply for several years. If our economic expansion and excellent construction market is to be sustained, ways must be found to provide these workers. AGC will be participating in a variety of industry groups to raise this issue with the Congress. Hearings on this subject have been held on the House side and we expect that the Senate will consider a bill to expand immigration numbers this year.

PROCUREMENT

Blacklisting Regulation: When Congress returns, the Senate Governmental Affairs and Health, Education, Labor, and Pensions Committees plan to hold hearings regarding the Federal Acquisition Regulation (FAR) changes known as blacklisting regulations. Witnesses are expected to include an Administration witness, federal procurement attorneys, and the counsel for the AFL-CIO. The FAR Council received 1,600 comments from various interests regarding the proposed changes. Over the next several months, the FAR Council will be reviewing these comments and then make a decision about the future of the proposal. AGC urged the FAR Council to withdraw the regulation in its entirety. 

Miller Act Regulations Expected Shortly: The FAR Council must propose regulations for the Construction Industry Payment Protection Act (P.L. 106-47), a law amending the Miller Act. These regulations are expected to mirror the three changes made by Congress this year. The amendments included raising the payment bond to the value of the contract award, allowing receipt of notice through any method that provides written, third-party receipt, and preventing any waiver of the right to sue on the payment bond before work has begun.

Scorecard for 106th Congress |  Categories of Legislation: Legal Reform | Environment |  Human Resources
Employee Relations |  Safety and Health | Tax |  Trade | Procurement | Public Works/Federal Construction