TAUC Legislative and Regulatory Update, February 2016
The 114th Congress returned for its second session last month. However, due to the 2016 elections, we do not expect that much significant legislation will be enacted into law this year. Nevertheless, TAUC will continue to work diligently throughout this session to make sure our legislative and regulatory priorities are achieved.
Multiemployer Pension Reform
We anticipate that there will be further efforts to advance additional multiemployer pension reforms this session. The House Ways and Means Committee is expected to hold a hearing on composite plans in the near future, but no hearing date has been set at this point. A hearing was initially set for last July by then-Chairman – and now Speaker of the House – Paul Ryan (R-WI), but was postponed. While Speaker Ryan was familiar with multiemployer pension plans and the need for additional reforms, less is known about his successor on the Ways and Means Committee, Kevin Brady (R-TX).
At a recent Senate Finance Committee hearing on retirement security, both Committee Chairman Sen. Orrin Hatch (R-UT) and ranking member Sen. Ron Wyden (D-OR) referenced the need to explore the status of multiemployer pension plans. While Sen. Wyden expressed concerns with the changes that were enacted in MPRA, Sen. Hatch discussed the need to look at additional reforms and flexibility for multiemployer plans. We also anticipate that the Senate Finance Committee will hold a hearing soon on multiemployer pension plans.
Affordable Care Act – ‘Cadillac’ Tax
The 2016 omnibus included a two-year delay of the ACA’s excise tax on the value of ‘high-cost’ employer-sponsored health coverage. It was slated to take effect in 2018, but this date has now been pushed back until 2020.
The Obama Administration’s fiscal year 2017 budget is expected to include a plan to implement the Cadillac Tax as a regional rather than flat tax. This tax would tie the tax to the cost of the second-highest level of coverage that can be obtained through the Affordable Care Act in each area. Any employer whose plan is less expensive than that would be excused from the Cadillac tax. It’s unclear if this proposal will be given serious consideration in Congress. A majority of the House members are on record as supporting repeal of this excise tax.
We anticipate that Congress will continue efforts to block the Administration from implementing environmental regulations. While the final 2016 omnibus did not include environmental riders that would have rescinded the Clean Power Plan or the Waters of the United States Rule (WOTUS), numerous members of Congress continue to point to the appropriations process to prevent the Administration from finalizing these rules.
Congress passed legislation under the Congressional Review Act which would have revoked the WOTUS Rule and regulations imposing limits on carbon emissions from new and existing power plants, but these resolutions were vetoed by President Obama and both houses of Congress lack the votes to override the vetoes.
While efforts to block these regulations in Congress face opposition, there are still a number of court challenges that could prevent the rules from taking effect. Twenty-five states have filed lawsuits against the Clean Power Plan and multiple entities are filing legal challenges against the WOTUS Rule.
DOL’s Silica Rule: The Department of Labor’s Silica Rule was sent to the Office of Management and Budget (OMB) at the end of 2015. It is currently being reviewed by OMB and is expected to be finalized this spring. The rule was proposed by the Occupational Safety and Health Administration (OSHA) in 2013 and would reduce the permissible exposure of silica over an eight-hour period to 50 micrograms per cubic meter to 250 micrograms per cubic meter in the construction industry.