On Friday, April 23, Senate Majority Leader Reid (R-Nev.) announced that the Senate would soon turn to immigration reform and that he would be introducing a Democrat-only detailed proposal this week.   This action runs counter to the bipartisan negotiations that had been occurring between Senator Schumer (D-N.Y.) and Senator Graham (R-S.C.) to develop a product that could get the support from both sides of the aisle as well as from the business community.  As a result of the Reid announcement, the bipartisan negotiations have stalled.  AGC has seen a draft of the Democratic proposal and the document raises concerns on how it would affect the construction industry as well as business in general.  Of particular concern is the concept of making general contractors responsible and liable for the hiring practices of their subcontractors.  AGC will continue to remain in the discussions with both the Senate and the White House as things progress.

This week, the Senate Health, Education, Labor, and Pension (HELP) Committee and the House Education and Labor Committee held hearings on workplace safety.  The HELP Committee focused particularly on mine safety in the Tuesday hearing in response to the recent accident in West Virginia. During the hearing, lawmakers and regulators were urged to focus on creative policies that will help employers promote safer workplaces before accidents can happen.  The House focused on the portions of the Protecting America's Workers Act that cover whistleblower and victims' rights provisions.  Witnesses expressed to the committee the need for legislation to modernize federal laws that protect workers who blow the whistle on unsafe working conditions and ensure victims of workplace accidents have a voice during OSHA investigations. AGC is closely watching these issues and the impact the passage of any legislation will have on the construction industry.

Last week, the California Air Resources Board admitted that its earlier estimates of the emissions from the off-road diesel equipment in California were too high, and in light of both its mistakes and the downturn in the economy, agreed to amend its costly off-road rule. This action followed AGC's release of its own study of such emissions, where AGC found that the Board's original estimates exceeded actual emissions by at least 350 percent.  AGC also found and announced that - in the absence of any off-road rule - the construction and other regulated industries will exceed the Board's goals for emissions of particulate matter (PM) and nitrogen oxides (NOx) through 2020 and 2025, respectively.How dramatically the Board will change the rule remains to be seen.  While it admitted to making a mistake, the Board maintained that it had overestimated emissions by no more than 100 percent, and did not make any specific commitments.  It did, however, agree to consider the following:Greater reliance on turnover to Tier IV equipment (which will not become available in the higher horsepower equipment until 2015) to improve air quality;While maintaining the structure of the current rule, streamlining its requirements;Providing some additional delay in the enforcement of the rule (which the Board has already agreed to stay until the U.S Environmental Protection Agency gives the Board the legal authority to enforce it);Reducing the retrofit, repower and replacement requirements that would otherwise take effect before 2015; andClassifying more vehicles as low use, and therefore exempt from the rule.The Board also sought to reassure the contractors that have already complied with the rule, indicating that it will give these contractors credit for anything they have already done to reduce their emissions.AGC of America and both of its California Chapters will continue to monitor the situation carefully.  AGC has already asked the Board to delay all of the requirements for retrofitting, repowering, replacing or retiring existing equipment until 2015, and to eliminate all of the requirements specifically for NOx.   At this point, it remains far from clear that the Board is willing to go that far.  On the other hand, AGC has yet to review or comment on ways that the Board estimated the size of its earlier mistake, or to hold any follow-up discussions with the decision makers.

On April 27, Senator Robert Menendez (D-N.J.) and cosponsors Kit Bond (R-Mo.), Mike Crapo (D-Idaho), and John Kerry (D-Mass.) introduced the Sustainable Water Infrastructure Investment Act  (S. 3262). The legislation will remove state volume caps on private activity bonds for water and wastewater projects and lead to the investment of billions of dollars in private money flowing into our nation's water infrastructure. S. 3262 is the Senate companion to H.R. 537, a bill authored by Congressman Bill Pascrell (D-N.J.) that passed the House in March as part of the Small Business and Infrastructure Tax Act.  AGC, along with the National Association of Water Companies and American Water, led the coalition effort in seeking the introduction of the Senate bill.

U.S. House of Representatives Committee on Transportation and Infrastructure Chairman Jim Oberstar (D-Minn.) Wednesday introduced the "America's Commitment to Clean Water Act" (H.R. 5088) to "clarify" federal jurisdiction over waters and wetlands under the Clean Water Act.  The bill would remove the term "navigable" from the Act and replace it with the phrase "waters of the United States." The bill is a revision to previously-introduced legislation, the "Clean Water Restoration Act."  Oberstar said during a press conference Wednesday that the legislation would ensure that the Clean Water Act covers the same waters it did prior to two U.S. Supreme Court rulings in 2001 and 2006, which placed limits on the reach of federal jurisdiction regulatory agencies were asserting at that time.AGC, along with the broad-based Waters Advocacy Coalition (WAC), has opposed the "Clean Water Restoration Act" and is concerned that the new proposal does not address concerns that the legislation would subject all waters and wet areas, however remote or intermittent, to federal regulations and permitting under the Clean Water Act and delay the construction of buildings and infrastructure nationwide.

As AGC and other stakeholders place a full court press on the U.S. Senate to include any revenue from additional fees on transportation motor fuels into the Highway Trust Fund, the Senators drafting the bill seem to be backing away from any fees that could be viewed as a gas tax. The bill is tentatively set to be introduced Monday, April 26, and among other controversial issues yet to be resolved is a so-called "linked-fee" on motor fuels.  This fee would likely increase the federal gas tax by approximately 15 cents per gallon without dedicating the revenues from the fee to the Highway Trust Fund.  AGC continues to work with key Senators to gain support for dedicating any revenues from an increased fee on motor fuels to the Highway Trust Fund. Use AGC's Legislative Action Center to communicate on this issue with your Senators.

Following passage of the health care bill, President Obama and congressional Democrats now seek to reform the country's financial sphere with a financial overhaul bill.  The 1,336-page bill includes key provisions that would negatively impact commercial real estate, such as risk-retention provisions, regulation of over-the-counter (OTC) derivatives, and new reporting requirements for real estate investors.A March 25 letter, signed by AGC and more than 20 other organizations, to Senate Banking Committee Chairman Christopher Dodd (D-Conn.) and Richard Shelby (R-Ala.) urged the Senators to re-think the bill's current language regarding securitization, new accounting standards, and new regulatory capital guidelines.  The letter states that these provisions "create tremendous uncertainty and impact credit availability."

Next week, the Senate Health, Education, Labor, and Pension (HELP) Committee and the House Education and Labor Committee will hold hearings on workplace safety. The HELP Committee is focusing particularly on mine safety in response to the recent accident in West Virginia.  The House will focus on the portions of the Protecting America's Workers Act that cover whistleblower and victims' rights provisions.  AGC is closely watching these issues and the impact the passage of any legislation will have on the construction industry.

This week both Speaker Pelosi and Senate Majority Leader Reid said that they would like to see comprehensive immigration reform taken up in 2010. The two main Senators working on the development of such a bill, Senator Schumer (D-N.Y.) and Senator Graham (R-S.C.), continue to meet with each other as well as those groups affected by such legislation.  AGC remains in the discussions and continues to promote workable reform, which would include reasonable employer enforcement as well as a new visa program that would create a system to supply the U.S. economy with the workers it needs as the country begins to recover from the downturn and grow in the years ahead.

House and Senate tax writing panels are working to deal with a number of outstanding tax issues facing Congress in 2010.First, despite each chamber having passed its own version of the annual "tax extenders" package that would extend for one year roughly $30 billion in tax provisions that expired on January 1, the House and Senate remain unable to reach an agreement on how to offset the cost of the legislation.  The tax extenders bill includes extensions of tax incentives useful to construction, including the 15-year shortened cost recovery period for restaurant improvements and new construction, leasehold and retail improvements, and a short-line rehabilitation tax credit.Second, the Senate Finance Committee is considering how to move forward on a small business tax relief and infrastructure bill the House passed in late March that includes, among other things, an extension of the successful Build America Bonds program into 2013.  In addition, the Senate may add an extension of 50 percent bonus depreciation from the Recovery Act, along with the an extension of enhanced section 179 expensing that is included in the House-passed bill.  Depending on whether sufficient offsets can be found, leadership in both chambers have expressed interest in resolving these two measures prior to Memorial Day.Finally, the House and Senate are working on ways to address the lapsed estate tax and the expiration of the 2001 and 2003 tax cuts at the end of 2010.  The House passed legislation in December that would have extended the 2009 estate tax rate of 45 percent with an exemption of up to $3.5 million per spouse.  However, a bipartisan group of Senators is trying to lower the rate to 35 percent and increase the exemption to $5 million per spouse and is seeking a vote this spring on their proposal.  If no action is taken in Congress, the estate tax will be reinstated at a 55 percent top rate and $1 million exemption level. The Senate Budget Committee this week took initial steps towards continuing the 2001 and 2003 tax cuts for the middle classes.  In its fiscal year 2011 budget resolution, the committee included a permanent extension of current policy for couples with incomes below $250,000 and singles with incomes below $200,000.  The resolution calls for allowing the current 35 percent tax bracket to increase to 39.6 percent on January 1, 2011, and the 33 percent bracket to bump up to 36 percent. The resolution also contains reconciliation instructions that could allow the Senate to pass tax legislation with a simple majority, rather than by overcoming a 60-vote threshold needed to end a filibuster. AGC is monitoring developments on these important pieces of legislation.  AGC supports lowering the federal burden on individuals, construction companies, and other business as a means of promoting investment, business development and business expansion.