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May
Government Relations Update
NRCA's 1999
legislative agenda has gotten off to a fast start. The House of
Representatives recently passed three pieces of legislation that
should prove to be helpful to contractors.
Two of the bills
concern federal paperwork requirements imposed on small businesses.
The first - Electronic Filing for Small Businesses (HR 439) - would
require federal agencies to enable small businesses to access and
submit federal forms, such as Occupational Safety and Health
Administration (OSHA) forms, electronically. And the Small Business
Paperwork Reduction Act Amendments of 1999 (HR 391) would grant
small businesses six-month grace periods for most first-time
violations of federal paperwork regulations.
In addition, the
Mandates Information Act (HR 350) would establish new procedural
limitations on legislation that imposes federal mandates on the
private sector. The act would require the Congressional Budget
Office to prepare special cost estimates, called Consumer, Worker
and Small Business Impact Statements, for new private sector
mandates in bills. For legislation estimated to impose more than
$100 million in costs on the private sector, the act would allow a
separate debate and roll call vote in either the House or Senate to
determine whether to proceed with the legislation.
NRCA has
actively supported the Small Business Paperwork Reduction Act
Amendments and Mandates Information Act. NRCA's Washington Office
sent letters to each House member supporting both bills and, as an
additional step presented a statement to the House Rules Committee
in favor of the Mandates Information Act. The House Rules Committee,
which determines the rules by which a bill is moved or considered in
the House, held a hearing because the Mandates Information Act would
involve a parliamentary procedure.
Other legislative and
regulatory issues that NRCA's Washington Office is working on
include:
- Budget and Appropriations
NRCA worked hard to
ensure that the passage of the Republican Budget Resolution
included spending caps. Before the vote, Steven Kruger, president
of L.E. Schwartz & Son Inc., Macon, Ga. and former NRCA
president, sent a Western Union mailgram to the Senate and House
stating: "NRCA urges you to support passage of the Republican
Budget Resolution, which includes adhering to spending caps. NRCA
encourages you to maintain true fiscal discipline and give some
much needed tax relief to hardworking Americans."
Now that
the budget blueprint is in place and spending caps are set, the
Senate and House appropriations committees are faced with the task
of cutting unnecessary spending and, in some cases, freezing
agency budgets, such as OSHA's.
Within days following the
bill's final passage, Chief Deputy Majority Whip Roy Blunt (R-Mo.)
wrote NRCA the following note: "The Office of the Majority Whip is
grateful for your willingness to put aside your own interests to
shepherd this effort [that] will be so beneficial to all
Americans. Thanks for all that you do."
- Skilled Workforce Enhancement Act
The Skilled
Workforce Enhancement Act of 1999 allows a small business employer
who trains employees in highly skilled trades, which are defined
as precision machinists, die makers, mold makers, tool and die
designers, heating, ventilating, air conditioning, refrigeration,
roofing contractors, the trade of masonry, and other trades
specified in regulations prescribed by the Secretary of Labor, to
receive a tax credit of $15,000 per employee per year for up to
four years. In exchange for this credit, the employer must provide
2,000 hours of shop training per year, including classroom
training, necessary to produce a skilled employee. This bill also
defines a small business employer as any employer who employs 250
or fewer people a year. The bill was introduced by Representative
Jim Talent (R-Mo.) on May 14, 1999 and has 16 bipartisan
cosponsors.
- Estate Tax Relief/Repeal
Currently, the estate
tax (death tax) is so large that survivors must often liquidate to
obtain enough cash to obtain the business. The tax can easily be
over one-half of the estate. A study released by the Congressional
Joint Economic Committee states that this tax "generates costs to
taxpayers, [and] the economy,...that far exceed any potential
benefits that it may arguably produce."
Among its
findings, the study also found that the death tax is a leading
cause of dissolution of family-run businesses. It diverts
resources from investment and employment, and it raises very
little if any, net revenue for the federal government.
Representatives Jennifer Dunn (R-Wa.) and John Tanner (D-Tenn.)
introduced HR 8 that would eliminate the death tax over a 10-year
period. NRCA is a member of the Family Business Estate Tax
Coalition that is lobbying to include the Dunn-Tanner proposal in
the House tax cut bill, which is scheduled to be finalized on July
16, 1999.
- Anti-Association Tax
The Clinton Administration
included in its FY2000 budget proposal a tax on investment income
from associations. NRCA signed onto an open letter to Congress and
also sent a letter to Senator Joe Lieberman (D-CT) urging Congress
not to adopt this tax in any of the budget blueprints.
Fortunately, the tax was not included in either the House or
Senate budget resolutions.
- Miller Act Reform
The Construction Industry
Payment Protection Act, HR 1219, would amend the Miller Act, a
federal statute that protects public funds by requiring prime
contractors on all federal construction projects over $100,000
obtain surety bonds. Surety bonds are insurance products that
guarantee the performance of another person to a third party. A
payment bond guarantees that the contractor will pay the
subcontractors and suppliers with whom the contractor has a
contract.
HR 1219 would raise the penal sum of the payment
bond to equal the contract price. The penal sum is the total
amount of protection offered by the bond. Currently, Miller Act
payment bonds are capped at $2.5 million, a figure that could, in
theory, prove inadequate if the contract price were especially
large. In response to this concern, HR 1219 would raise the amount
of the payment bond making adequate payment protection a
certainty.
HR 1219 also would prohibit any requirements
that subcontractors waive their Miller Act payment bond rights
prior to commencing work on the project. In addition, HR 1219
would allow a subcontractor to send a notice of claim on a payment
bond by any method of delivery that produces verification from an
independent third party. The construction industry is united
behind the bill and on May 13, the House Government Reform
Committee voted HR 1219 out of committee by a voice vote.
- NRCA's Fall Committee Meetings/Legislative
Conference
NRCA's Fall Committee Meetings and
Legislative Conference will be held at the Loews L'Enfant Plaza
Hotel, September 27 - 30, 1999 in Washington, DC. Contractor
members, affiliates, manufacturers, and spouses will hear
presentations from Capitol Hill notables and Washington political
insiders. In addition, NRCA members will lobby members of Congress
and their staffs on various issues.
Date:
5/24/99
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