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TAUC Legislative & Regulatory Update, December 2016

TAUC Legislative & Regulatory Update, December 2016

Washington is preparing for significant change in the coming months as President-elect Trump prepares to take office. The election produced an uncertain outcome from a governing standpoint. We now have a President-elect who ran against the establishment of the party whose nomination he received, and is clearly not a traditional politician. In Congress, Republicans retained their majorities in both the House and Senate - albeit with majorities that have narrowed somewhat. The Senate majority is well short of the 60 votes necessary to overcome filibusters. While the House republicans still have a relatively large majority, their leadership continues to face challenges within its conference from the Tea Party-based Freedom Caucus.

Despite the unpredictable nature of the incoming political and legislative environment, we anticipate significant activity on policy issues important to TAUC members and their customers. Here is an exclusive update from TAUC on issues of vital interest to contractors and the union construction and maintenance industry as a whole.

Multiemployer Pension Reform

TAUC and our building trades and construction trade association partners had hoped to secure passage of legislation authorizing hybrid composite plans during the recently completed lame duck session of Congress. Retiring House Education and the Workforce Committee Chairman John Kline had proposed legislation authorizing composite plans, and worked tirelessly to have this legislation enacted. Unfortunately, there were only a limited number of legislative vehicles to which composite plan legislation could be attached, and those efforts were not successful.

One potential legislative vehicle that should come up early in the next congress is a bill regarding the pending insolvency of the United Mine Workers of America pension and health benefits programs. During the lame duck, Congress included funds to ensure that retired mineworkers did not lose health care benefits, which would have occurred without an infusion of funds into the plan. There were efforts to pair a permanent fix for the mineworkers' fund with legislation authorizing composite plans. Those efforts faced an uphill fight to be included in a four-month temporary spending bill. The mineworkers' plan faces another deadline when the current Continuing Resolution expires at the end of April.

With Kline retiring, we will need to identify a new champion for the composite plan concept. We will also have to work to educate the new Administration on the challenges facing multiemployer plans and the need for composite plans. During the recently concluded State of the Union Construction Industry Forum, a number of TAUC members participated in meetings with their members of Congress and staffs to educate them on the challenges they face in the current multiemployer system and the potential benefits of transitioning to composite plans. Thanks to all those who participated.

Environmental Regulations

One area where we anticipate significant changes will be in the implementation of environmental regulations. Congressional Republicans have fought the Obama Administration's long list of efforts to impose new regulations and standards targeting industries and facilities critical to TAUC members and their markets. Those efforts were unsuccessful since any legislation passed would have had to be signed by the President. The incoming Administration will take a very different tack when addressing environmental concerns, proposing and implementing environmental regulations, and fighting efforts to block the regulations in court.

While we anticipate a new approach to these regulations and policies, there will be administrative limits on their ability to completely reverse course and undo pending regulations and legal challenges. We expect there will be a combination of legislative riders to appropriations bills to prevent implementation of some regulations, Congressional Review Act legislation to kill recently implemented regulations, rewrites of pending rules, and changing legal strategies and tactics. Which strategy will be utilized and the chances that the strategy will be successful will depend on the status of specific rules. Stay tuned to this space as TAUC will provide updates of the various legislative and administrative efforts to implement rational policies that balance environmental concerns with the nation's energy production and manufacturing needs.

First 100-Day Agenda

As with the beginning of any new administration, we anticipate action on a range of policy issues identified as priorities during the campaign. These will include a number of issues important to TAUC members. In addition to efforts to roll back environmental regulation, President-elect Trump has placed a priority on repealing the Affordable Care Act and enacting a major infrastructure investment package. While it is unlikely to occur in the first 100 days, the Congressional leadership has prioritized enactment of comprehensive tax reform. At this point, we anticipate that republicans in Congress will enact a phased-in repeal of the ACA - including the Cadillac excise tax for higher cost plans - early this session. It is also possible infrastructure investment package will be paid for with revenues generated through comprehensive tax reform. Throughout this period, TAUC will continue to monitor the development of these legislative packages, and look for opportunities to advance TAUC priorities - such as composite plans, infrastructure investments, repeal of the Cadillac tax and other changes to the ACA, and scaling back of environmental and labor regulations undermining the operations of TAUC members and their customers.

12/13/2016