TAUC Legislative & Regulatory Update, February 2020

February 4 2020

TAUC Legislative & Regulatory Update, February 2020

While Washington appears to be "all impeachment, all the time," actually there have been a number of important developments on issues of importance to TAUC and its members. Here is an exclusive update from TAUC on policy and regulatory issues of vital interest to contractors and the union construction and maintenance industry.

PRO Act

The House is expected to consider H.R. 2474, the "Protecting the Right to Organize Act" (PRO Act). This legislation would make significant changes to dozens of labor laws to assist union organizing efforts. Changes in the bill to existing labor law include:

• Authorizes "card check" organizing – which allows employees to form unions under certain circumstances through the informal collection of authorization forms from a majority within the bargaining unit;
• Repeals restrictions on secondary boycotts and common-situs picketing;
• Amends the NLRA to allow intermittent strikes;
• Imposes mediation and binding arbitration when negotiations over a first contract break down;
• Establishes joint employer status change could alter well-settled subcontracting practices in the construction industry; and
• Grants the NLRB the power to levy civil fines – in addition to back pay – on employers that violate labor law.

While the labor law changes in the legislation raise several concerns, the bill also includes provisions designed to address employee misclassification, which is a significant issue in the construction industry. Specifically, the bill would establish an "ABC" test for determining independent contractor status. The test requires that a worker be free from the employer's control while performing the work, operate outside the typical course of business, and be customarily engaging in the trade.

H.R. 2474 is expected to pass the House with bipartisan support. There are currently 219 bipartisan cosponsors on the bill. However, the bill is very unlikely to be considered in the Senate.

Environmental Permitting Reform

The Trump Administration has proposed significant changes to the permitting process under the National Environmental Policy Act (NEPA). NEPA is the environmental law which governs how federal agencies evaluate the potential impacts of infrastructure projects. This effort to narrow the scope of NEPA to streamline the permitting process would provide regulatory certainty through the permitting process and increase efficiency in the infrastructure sector.

Under the new rule, federal agencies would no longer be required to consider the "cumulative" impacts of a new project. This includes a project's impact on the environment, as well as the effect climate change would have on the project. The new rule would also restrict the types of projects subject to environmental review, allow certain project sponsors to complete their own environmental reviews "under the supervision of an agency," and place a two-year time limit on environmental impact statements (and a one-year limit for certain projects).

The proposed rule also attempts to exempt projects without significant federal funding from environmental reviews. The public has 60 days to comment on the proposed changes. It is very likely legal challenges will be filed against the rule. TAUC recently joined a coalition of industry and labor groups to support changes to NEPA. "Unlock American Investment" supports efforts to update NEPA and points to significant infrastructure projects that have been delayed as a result of the current law.

House Infrastructure Package

House Democrats released a $760 billion proposal to fund federal infrastructure investments over a five-year period. The proposal — entitled the "Moving Forward Framework"– is an initial outline of Democratic infrastructure priorities, policy principles and funding levels for multiple programs. It is not clear if this infrastructure package would move through the House as one big bill, or whether it would move in several different packages.

The largest investment in the Framework is the proposed $489 billion, five-year surface transportation bill. This legislation is currently being drafted by the House Transportation & Infrastructure Committee and includes:

• $319 billion for highway investments;
• $105 billion for public transportation improvements; and
• $55 billion for rail investments.

For core Highway Trust Fund (HTF)-supported highway and public transportation programs, as well as the Capitol Investment Grant transit program that is supported by the federal General Fund, the House plan would increase investment by $137 billion – a 48 percent increase above the current authorization levels for surface transportation programs contained in the FAST Act. The proposal also calls for maintaining the current HTF solvency as a priority, but neither details how they want that to happen. Democrats call for maintaining the "user-based mechanisms" to generate the revenues for the Highway Trust Fund – which is the source of most Federal surface transportation funding – pay for the proposed investment.

The Framework also calls for:

• $86 Billion to expand broadband access;
• $55 billion in Rail investment to address backlog in rail and facility investments and support new or improved passenger rail corridors;
• $50.5 billion for clean water and wastewater infrastructure, including $40 billion in the Clean Water State Revolving Fund (CWSRF);
• $34.3 billion for "clean energy" improvements, including: investing in electric grid modernization to accommodate more renewable energy and to make the grid more secure, resilient and efficient; invest in energy efficient infrastructure including retrofitting and weatherizing buildings; and strengthen existing energy supply infrastructure and expands renewable energy infrastructure in low income and underserved communities; and support the development of an electric vehicle charging network to facilitate the transition to zero emissions vehicles from coast to coast;
• $30 for airport infrastructure modernization and capacity improvements;
• $25.4 Billion for safe drinking water infrastructure investments;
• $19.7 Billion for harbor, port and channel dredging;
• $10 billion for investments in construction of backlogged water resources development and flood protection projects already approved by the Army Corps of Engineers;
• $2.7 billion for brownfield restoration;
• Increasing the Passenger Facility Charge (PFC) cap to allow local airport authorities to increased investment in airports; and
• Ensuring all revenue in the Harbor Maintenance Trust Fund can be spent on operation and maintenance.

While the Framework contains a lot of specifics regarding the amount of funds the House Democrats would like to investment in various aspects of the nation's infrastructure, it does not address one of the fundamental challenges with advancing infrastructure legislation – how to pay for it. During the press conference announcing the Framework, House Ways and Means Committee Chairman Neal (D-MA) – who is responsible for identifying the revenue – said it is "premature to talk about how to pay for the package until there is agreement with the White House." Neal has been working with Treasury Secretary Mnuchin to attempt to reach an agreement on generating additional revenue to support increased infrastructure investments.