The U.S. Senate is drafting a comprehensive bill to address climate and energy, and it is basing that work on a related bill passed by the U.S. House of Representatives.  The third installment of AGC's summary of the American Clean Energy and Security Act of 2009 (H.R. 2454) highlights the major provisions of Title III (Reducing Global Warming Pollution), which identifies reduction goals and establishes a cap-and-trade program to reduce emissions from major sources.Under a cap-and-trade program, covered entities are permitted to emit a certain amount of a pollutant during a defined period of time, such as one year.  The amount of pollutant the entity is allowed to emit - allowances -- depends on the category of the source (e.g., electric utility industry).  Each category of sources is assigned a limited number of allowances (e.g., the electric utility industry category received 35 percent of the total allowances under H.R. 2454).  The total number of allowances economy-wide also is capped and decreases each year in order to meet the emissions reduction goal set by policymakers.  If a covered entity requires more than its permitted allowances, then it can seek to reduce emissions, offset the emissions and/or obtain the needed allowances from another covered entity.Subtitle A - Reducing Global Warming PollutionThe bill amends the Clean Air Act to add a new title, Title VII: Global Warming Pollution Reduction Program. Reduction Goals and TargetsThe bill identifies greenhouse gases of concern as those that induce global warming and "cause and contribute to injuries to persons in the United States."  The bill sets economy-wide gas reduction goals beginning in 2012, aiming to keep emissions below 97 percent of the quantity of emissions in 2005; and reduces the acceptable amounts in subsequent years: 2020 at 80 percent of 2005 levels; 2030 at 58 percent; and 2050 at 17 percent.  The bill further sets nearly identical reduction goals for specific capped sources of emissions.  Part A also establishes a review and recommendation process for Congress to assess the progress towards achieving the intended reductions.Designation and Registration of Greenhouse GasesThe bill identifies seven categories of greenhouse gases and authorizes the administrator of the U.S. Environmental Protection Agency to designate additional gases as warranted.  The bill then establishes a registry of greenhouse gases for sources that meet specific criteria, such as stationary sources within specified categories (e.g., cement production) and those that emit 25,000 metric tons per year of carbon dioxide equivalent.  It also authorizes the administrator of the EPA to determine whether to include reporting requirements for vehicle fleets in the registry.  Among the logistical instructions to EPA in the bill, Congress requires that EPA provide for immediate dissemination of the reported data on the Internet.Program Rules, Offsets and Deforestation ReductionThe bill establishes emission allowances for covered entities based on calendar year.  The number of allowances diminishes each year beginning at 4,627 (in millions) in 2012 to 1,035 in 2050 and stabilizes thereafter at the 2050 amount.  The bill further outlines details of the cap-and-trade program including prohibitions for exceeding allowances, methods of demonstrating compliance, the use of offsets and the trading and banking of allowances and offsets.  EPA will issue permits to administer the program.  The bill details the establishment of an offsets program including information on eligible offset projects, requirements, approval, review and audit procedures.  It outlines an international deforestation reduction program. Subtitle B - Disposition of AllowancesThe bill lays out the allocation and auction of allowances with programs to benefit consumers, renewable energy and energy efficiency, trade-vulnerable industries, etc.Subtitle C - Additional Greenhouse Gas StandardsThe bill amends the Clean Air Act to add a new title, Title VIII: Additional Greenhouse Gas Standards.Stationary Source StandardsThe bill charges EPA to publish an inventory of the uncapped sources of greenhouse gas emissions that emit greater than 10,000 tons per year of carbon dioxide equivalent. It further directs EPA to promulgate standards of performance for those sources and corresponding regulations.  EPA may promulgate other standards (design, equipment, operational-based) in lieu of performance standards "without regard to any determination of feasibility...".Exemptions from Other ProgramsThe bill exempts greenhouse gases from regulation under several programs in the Clean Air Act, such as criteria pollutants, hazardous air pollutants, new source review and title V permits.  The bill amends the Clean Air Act to include hydrofluorocarbons (HFCS) as class II substances and charges EPA with promulgating regulations to phase down the consumption of 20 listed HFCS that fall into class II, group II substances.Black CarbonThe bill requires EPA to evaluate black carbon emissions and submit a report to Congress with -- among other details -- an inventory of major sources, technologies and strategies for reductions and recommendations of actions to reduce emissions.  The bill then requires EPA to promulgate regulations to reduce black carbon emissions or to propose a finding that existing regulations currently address these emissions adequately.OtherThe bill further addresses state programs, Davis-Bacon compliance, biological carbon sequestration as well as acid rain and mercury pollution reduction.Subtitles D and E- Carbon Market Assurance and Additional Market AssuranceThe bill amends the Federal Power Act to "promulgate regulations for the establishment, operation and oversight of markets for regulated allowances...".  It also sets forth numerous conditions on swapping derivatives and other transactions that involve energy commodities.What Can You Do?Read the "AGC Looks at Climate Bill H.R. 2454" series, the introduction,Title I summary and Title II summary.Take action and write your Senator using the AGC Legislative Action Center. (AGC, its Chapters and members sent over 2,000 letters to Capitol Hill in response to H.R. 2454).Explore the potential threats and opportunities for the real estate and construction industries in climate legislation.  This is an evolving discussion draft document resulting from AGC's meetings and discussions with representatives of the real estate and construction industries and other related groups.Go to www.congress.gov and search under "H.R. 2454" to read the bill.Read information about greenhouse gas emissions associated with the construction industry.Learnlow-cost ways contractors can reduce greenhouse gas emissions from equipment.

Senator Tom Harkin (D-Iowa) has taken the chairmanship of the Senate Health, Education, Labor and Pension (HELP) Committee.  Senator Christopher Dodd (D-Conn.) had been standing in prior to former HELP Chairman Senator Ted Kennedy's (D-Mass.) death to help marshal health care reform through the Senate.   In an agreement made with democratic leaders in the Senate, Sen. Dodd will continue his role as the point person in the health care debate for the HELP Committee and remain chairman of the Banking Committee.  Sen. Harkin is the top supporter of the "so-called" Employee Free Choice Act (EFCA) in the Senate and is pushing for a vote on the bill.  Currently, there are enough votes to move EFCA in the committee and the sticking point remains the ability to garner 60 votes for cloture to end debate on the Senate floor.  Sen. Harkin is trying to work with other EFCA supporters to find some sort of compromise, but announced at a pro-EFCA rally today that he does not think a bill will pass this year.  AGC strongly opposes EFCA and sees any compromise as a Trojan Horse to push through the legislation as it currently exists.  Please continue to send letters to your Members of Congress opposing EFCA through AGC's Legislative Action Center.

President Obama will continue his push for sweeping reform of health care with an address to a joint session of Congress on Wednesday night. Obama will try and regain control of the issue after weeks of negative press and public opposition to the current reform package in town hall meetings across the country. The speech on Wednesday night is expected to focus on the need for reform but may fail to provide additional details on a reform package, including a public option.Despite the diminishing hope that the Senate can deliver a bipartisan bill, a small group of senators will continue to meet to find common ground. The group dubbed the "Gang of 6" - including Senators Max Baucus (D-Mont.), Jeff Bingaman (D-N.M.), Kent Conrad (D-N.D.), Charles Grassley (R-Iowa), Mike Enzi (R-Wyo.) and Olympia Snowe (R-Maine) - plans to meet Friday. If the Senate is unable to get bipartisan support, it is possible Democratic leaders may attempt to use reconciliation to pass health care reform - a procedural motion to avoid a filibuster - but that move could prove to be troublesome for Democrats and fail to deliver on all of their goals for reform. In the House, Speaker Pelosi continues to announce that they will not pass a reform bill without a public option.AGC remains opposed to the current House bill, H.R. 3200. The bill includes an employer mandate which fails to increase affordability and will restrict job growth through the onerous payroll tax penalty. The bill includes the creation of health care "exchanges," which limit access to all employers and offers tax credits that will help very few employers. The government run public option in the bill will compromise the viability of private insurance and ultimately force all individuals into the public plan.  Additional concerns include the bill's failure to address malpractice reform and expanding the use of Health Savings Accounts. Finally, the income surtax in the bill will impose an additional tax on individuals and some construction employers that are organized as 'S' corporations or other flow-through entities, making it even more difficult for employers to operate and grow their businesses in the current economy.

When Congress returns next week from its summer recess it must take action to ensure continuation of the highway and transit program. SAFETEA-LU expires on September 30, 2009 and Congress must take action before that time to avoid funding disruptions. This current reauthorization effort is even more difficult than it has been in the past because the balance in the Highway Trust Fund (HTF) has been spent down. Congress has had to provide two infusions of general fund revenue, totaling $15 billion, to ensure there is enough revenue to reimburse states for on-going construction projects through the end of FY2009.The Senate is expected to bring up legislation reported from Committee just prior to the recess to extend authorization for 18 months until March 2011. The bill also includes an additional general fund transfer to ensure the HTF remains solvent during that time period. The Obama Administration supports an 18-month extension of authorization for the program coupled with an additional infusion of general fund revenue to keep the programs at a steady funding level.Meanwhile, House Transportation and Infrastructure Committee Chairman Jim Oberstar (D-Minn.) is pressing for Congress to continue to work on the multi-year reauthorization. A draft bill has been reported out of subcommittee and the full Committee will be addressing the bill soon.AGC continues to advocate the need for six-year reauthorization legislation with significantly increased revenues to address the nation's growing transportation infrastructure deficit, while working to ensure there is no disruption in program funding in the interim.

The Department of Homeland Security (DHS) on July 8 announced the administration's intent to "push ahead with full implementation" of a rule requiring federal contractors to use the E-Verify system to verify employees' authorization to work in the U.S.  The E-Verify rule will apply to federal solicitations and contract awards government-wide beginning September 8. In response to a legal challenge to the rule and in order to give the new administration time to fully review the matter, the government agreed to suspend the rule on three separate occasions, with the latest delay date of September 8, 2009.  The rule requires the insertion of a new clause in certain federal contracts and subcontracts.  Prime contracts below the simplified acquisition threshold of $100,000 and those with performance terms of less than 120 days are excluded.  The clause requires the contractor to use E-Verify to confirm employment eligibility of all new employees hired during the contract term and all current employees assigned to work on a federal job within the U.S.  It also allows, but does not require, the federal contractor to use E-Verify to confirm eligibility of all employees, regardless of whether they are assigned to work on a federal job.  Currently, use of E-Verify to confirm anyone other than a new hire (including applicants and current employees) is prohibited. AGC will continue to monitor all related litigation and legislation and will report on significant developments.Click here for DHS's list of Frequently Asked Questions (FAQ's) for Federal Contractors and E-Verify.  Click here for more information about critical components of the rule.Meanwhile, further guidance on immigration compliance is available in an MP3 download of a live educational session held at AGC's Annual HR Professionals Conference in June 2008.  An immigration law update will also be provided at AGC's next HR Professionals Conference, which will take place October 27-29, in Atlanta, Ga. Click here for conference details and registration.

The comment period on the proposed rule relating to project labor agreements, which had expired August 13, wasextended last week for 30 days, with a new deadline of September 23.The proposed rule would implement President Obama's executive order encouraging (but not requiring) agencies to consider requiring PLAs on projects over $25 million.  Read more about the rule and find AGC's comments here.If you would like to submit your views, you can send comments by mail to General Services Administration, Regulatory Secretariat (VPR), 1800 F Street, NW, Room 4041, ATTN: Hada Flowers, Washington, D.C. 20405, or by fax to (202) 501-4067. Comments can also be submitted online via the federal eRulemaking portal by clicking here.

Vice President Joe Biden delivered a speech today to mark the 200-day mark since the stimulus took effect.  In terms of the stimulus' effect on the construction industry, the vice president reported that more than 10,000 transportation projects have so far been approved.  He went on to say that work created by the stimulus has exceeded goals.  He specifically cited work that had been started on 2,200 highway projects (700 more than expected at this stage) and 192 airport projects (94 more than scheduled).  Biden highlighted in his speech that work has begun on 200 new rural waste and water systems as a result of the stimulus.  In terms of construction contracts, Biden acknowledged that on average bids are coming in at 8 to 10 percent below estimates and noted that he wants to ensure that any savings the government sees from these low bids is used wisely and invested back into infrastructure projects.In addition to his speech, the vice president sent a letter and issued a report to President Obama summarizing each agency's achievements in meeting their goals and commitments in the 200 days since the stimulus took effect.  A copy of the letter and the report is available here.

The passing of Sen. Ted Kennedy (D-MA) will not just impact the health care debate he so passionately was a part of for half a century, but will reverberate to other issues as well. The loss of Kennedy leaves the Democrats with 59 votes in the Senate, one short of a filibuster-proof majority, until a special election is held in January.  Prior to his death, Democrat leaders had threatened to use a seldom-used procedural maneuver to pass health care reform without Republican support. It is not yet clear how the loss of Kennedy will play into the possibility of leaders using this procedure or if Democrats will work on getting bipartisan support.Kennedy had chaired the Senate Health, Education, and Labor Committee which will be responsible for crafting much of the health care legislation in the Senate. Kennedy was the lead sponsor of the Employee Free Choice Act which had stalled in the Senate because it was unable to attract the 60 votes needed for cloture.  Among other major issues that he worked on were education and immigration.

The comment period on the proposed rule relating to project labor agreements, which had expired August 13, was extended for 30 days, with a new deadline of September 23. The proposed rule would implement President Obama's executive order encouraging (but not requiring) agencies to consider requiring PLAs on projects over $25 million.  Read more about the rule and find AGC's comments here.

The Federal Highway Administration (FHWA) has notified states that, as required by SAFETEA-LU, $8.7 billion in budget authority will be rescinded from their unobligated Federal-aid highway balances on September 30, 2009. While for some states this will not have a direct effect, in many states this will result in an actual cut in funding for highway construction projects.Each state will lose budget authority in a proportion that matches its percent of the total highway funds that were provided over the six year life of SAFETEA-LU (FY 2004-2009). Senator Kit Bond (R-MO) attempted to remedy this situation with an amendment in July when Congress was taking action to keep the Highway Trust Fund solvent by transferring $7 billion from the general fund. While there was significant support to correct the rescission problem, it was not acted on and, therefore, FHWA is required to take this action. AGC is working to have this rescission corrected when Congress returns from its summer recess.