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TAUC Legislative and Regulatory Update, June 2017

TAUC Legislative & Regulatory Update, June 2017

May was a busy month in Washington. The House Republican leaders were successful in putting together a majority of Republican members to pass its version of Obamacare repeal. Action now moves to the Senate, where significant changes to the House-passed plan are anticipated. The President also submitted his FY 2018 budget proposal to Congress, setting up what appears to be a very contentious and challenging budget process later this year.

Here is an exclusive update from TAUC on issues of vital interest to contractors and the union construction and maintenance industry.

Fiscal Year 2018 President's Budget: The Office of Management and Budget released the President's 2018 budget proposal. The proposal is DOA on the Hill, but it establishes a framework for Congress to begin developing the budget for next year. The proposed budget includes significant cuts in non-defense spending (both discretionary and mandatory) and optimistic economic assumptions to balance the budget by the end of the 10-year budget window and to fund large increases in defense spending.

In FY 2018, the budget proposes increasing defense spending by $54 billion above the 2011 Budget Control Act (BCA) limit (to $603 billion) and decreasing nondefense discretionary spending by $54 billion (to $462 billion). Over the 10-year budget window covered by this budget proposal (2018-2027), defense discretionary budget authority increases by $489 billion and nondefense discretionary budget authority is reduced by $1.7 trillion. This would require amending the BCA, which necessitates 60 votes in the Senate. The White House also proposes to cut net total federal spending (both discretionary and mandatory spending) by $4.6 trillion and reduce taxes by $1 trillion, mostly from repealing the Affordable Care Act, otherwise known as Obamacare, over the 10-year window.

Budget leaders in Congress, including many high-profile Republicans, are pushing back on the budget proposal. Despite this, it is probable that its call for massive nondefense spending cuts coupled with defense spending hikes will be embraced by many Republicans and set up a huge budget fight in Congress over FY18 appropriations.

Cut Proposed to the National Institute for Occupational Safety and Health: President Trump's proposed FY 18 budget includes a $139 million cut for the National Institute for Occupational Safety and Health (NIOSH). Such a significant cut will result in NIOSH being unable to carry out its mandate under the Occupational Safety and Health Act to conduct research aimed at preventing fatalities, injuries, and disease in the workplace. NIOSH has no enforcement function; rather, it works in partnership with TAUC and other private-sector organizations and academic institutions to produce actionable information that employers can use to improve working conditions and eliminate hazards on their jobsites. NIOSH sets its research agenda with the broad input from employers, and is responsive to new and emerging hazards that arise in the course of business, producing information and guidance that is used to save lives and improve the health of Americans.

Infrastructure: The budget proposal also included the framework for the President's "$1 trillion infrastructure plan." The budget refers to the $1 trillion figure as a "target" for investment in all aspects of the Nation's infrastructure that will be met through a combination of new Federal funding, incentivized non-Federal (state, local and private) funding, and expedited projects and Federal permitting. While there weren't a lot of specific details provided in the plan, the budget calls for Federal spending of $200 billion over the next 10 years (FY 2018-2027). Of this amount, $160 billion would be front-loaded between 2018 and 2022 - with $5 billion called for in FY2018.

While the budget calls for $200 billion in direct Federal spending to support the President's infrastructure plan, it does not propose any fixes for the Highway Trust Fund (HTF), which is scheduled to become insolvent in 2021. The HTF provides Federal investment in highway and public transportation capital projects. The budget assumes that beginning in 2021, investment in the HTF will be set at a level supported with existing HTF tax receipts, resulting in a reduction in total HTF outlays by $95 billion over the 2021-2027 window.

L-R: TAUC's Dan Hogan, TAUC CEO Steve Lindauer, Todd Doenitz of Barton Malow, TAUC's Todd Mustard and Mike Dorsey.

Construction Employers of America Push Infrastructure with Congressional Building Trades Caucus: On May 17, TAUC joined with the other contractor trade association members of the Construction Employers of America (CEA), the International Union of Operating Engineers, and the Co-Chairs of the Congressional Building Trades Caucus Rep David McKinley (R-WV) and Rep Donald Norcross (D-NJ), in an Infrastructure Week 2017 press conference. Their goal: urge Congress and the Trump Administration to quickly enact a $ 1 trillion infrastructure bill and begin restoring America's critical transportation and energy resources (click here for full coverage). Todd Doenitz, Director of Trade Labor with Barton Malow Company, one of the country's leading multi-trade union contractors and a TAUC Governing Member, participated on behalf of the CEA. CEA is a joint initiative made up of TAUC and six other construction trade associations designed to coordinate action on labor, workforce, and construction issues facing our industries.

Infrastructure was also a major focus of the CEA's National Legislative Conference, held May 2-4 in Washington, DC (see here for more information). Thanks to all TAUC members who participated in the conference, which was an opportunity for contractors to network with Washington policy experts and engage in face-to-face meetings with members of Congress and/or their staffs.

U.S. Withdraws from Paris Climate Accord: President Trump announced that the United States will withdraw from the 2015 Paris Climate Accord. The Accord, which was signed by 195 nations, aimed to reduce emissions of greenhouse gases. As part of the agreement, the Obama administration committed to cut greenhouse gas emissions 26 to 28 percent below 2005 levels by 2025 as part of the Paris deal. President Trump said that his Administration would begin efforts to renegotiate the Paris accord or strike an entirely new deal. The Paris Accords were never ratified by the Senate, so there are limited barriers to the United States leaving, although under the terms of the agreement, the U.S. cannot officially exit until Nov. 4, 2020.

EPA Action Expected Soon on Clean Power Plan: In a brief filed with the D.C. Circuit Court of Appeals, the EPA stated that it "may" soon propose changes to the Clean Power Plan. The court last month paused litigation for 60 days but ordered the Trump administration to give monthly updates on its efforts to revise or rescind the regulation. The court is currently weighing whether to extend that hold indefinitely or simply send the CPP back to EPA. In its brief, the EPA stated that it continues to review the Rule, as required under a Presidential Executive Order, and may be prepared to begin the interagency review process of a resulting proposed regulatory action "in the near future." EPA began reviewing the rule -- which was stayed by the Supreme Court last year and has never taken effect -- immediately after President Trump issued his "energy independence" executive order in March. EPA has also asked the U.S. Supreme Court to indefinitely extend its current stay on the rule, arguing that this would allow the agency to finish its review of the rule more quickly by not taking time and resources to address new legal challenges and issues.

06/06/2017