Legislative & Regulatory Update, April 2019

April 3 2019

TAUC Legislative & Regulatory Update, April 2019

As the 116th Congress gets down to business, here is an exclusive update from TAUC on policy and regulatory issues of vital interest to contractors and the union construction and maintenance industry.

Multiemployer Pension Reform

House committees with jurisdiction over pension reform have begun hearings on this looming crisis. Following last month's hearing of the House Ways and Means Committee, the House Committee on Education and Labor held a hearing on multiemployer pension plan solvency. Much of the discussion in the hearing focused on preventing cuts to benefits of participants and significant changes to plan funding rules that will significantly increase costs to contributing employers and substantially increasing PBGC premium.

During the hearing, several members from both parties continued to demonstrate a lack of understanding of the significant differences between single-employer pension funds and multiemployer pensions, particularly as it relates to PBGC premiums. Multiple members asked about moving towards risk-based variable premiums for the multiemployer program – similar to the premium structure for the single employer program. The President's FY 2020 budget proposal included a similar idea.

Mariah Becker from the NCCMP testified at the hearing. She urged members to act on a comprehensive solution in addressing the looming insolvencies of certain multiemployer pension plans and the PBGC and the consequences of failing to act on plan participants and contributing employers. She also stressed the need to protect and preserve financially healthy plans as part of any legislative solution.

We continue to engage with members on the need for a comprehensive solution to the multiemployer pension crisis protecting both the retirement security of all plan participants and the long-term viability of contributing employers. Such a solution should authorize the voluntary use of hybrid composite pension plans.

Infrastructure Investment

There continues to be a lot of activity on potential development of an infrastructure package. This appears to be one area where there could be some compromise in a divided Washington. Numerous Congressional committees have held hearings focusing on increasing and paying for infrastructure investments and improving delivery of infrastructure projects.

Despite the activity, there aren't a lot of specifics on what would be included in infrastructure legislation and how much investment would be included in the package. The one unanswered question is how – or if – to pay for the package. While some members have expressed a willingness to increase the gas tax or identify another revenue source, neither side seems willing to lead on increasing revenues to pay for the infrastructure package.

This process could be complicated by the introduction of a resolution call for the establishment of a "Green New Deal," which has set off a policy debate in Washington over the policies necessary to low greenhouse-gas emissions. This nonbinding resolution is short on specific policy recommendations but calls for a ten-year national mobilization and investments in infrastructure and energy. Many members of Congress have been very critical of the effort.

On a related note, President Trump recently issued a presidential permit to TransCanada authorizing construction of the Keystone XL pipeline. The new permit replaces the original permit issued in March 2017. The project has been stalled due to a Federal court decision requiring a new environmental review for the project. The new permit is intended to address uncertainty with the project and allow it advance to contraction. Additional litigation is expected.

Apprenticeship and Training

The House Education and Labor Committee Subcommittee on Higher Education and Workforce Investment recently held its first hearing of the year to examine opportunities to expand access to Registered Apprenticeship programs. The hearing drew a distinction been privately funded joint labor-management registered apprenticeships programs and the new Industry Recognized Apprenticeship Programs (IRAPs) called for by the President's Taskforce on Apprenticeship Expansion. IRAPs would allow private entities to both create and set standards for "apprenticeship" programs without the approval of the Department of Labor. IRAPs could also seek federal funding and charge participants for the training they provide. Thankfully, the construction industry is currently exempted from the establishment of IRAPs.

Jim Pavesic, Director of Education and Training for the United Association International Union, testified and provided the union construction industry perspective at the hearing. He emphasized partnership between organized labor, signatory employers, and the government in providing private investment in apprenticeship and journeymen skills training that separate union construction craft people apart from others in the industry. He also urged the subcommittee to enact policies to ensure signatory contractors receive credit for their private investment in training programs in the federal procurement process.

Legislation Authorizing Temporary Visa Program for Foreign Construction Workers

Legislation has been introduced by Congressmen Francis Rooney (R-FL) and Congressman Lloyd Smucker (R-PA) that would establish a new temporary visa program for construction. H.R. 1740, the "Workforce for an Expanding Economy Act," would allow foreign workers to enter the U.S. legally to address economic demands in construction and other industries to address shortages of available, qualified workers.