Capitol Hill Update: Legislation to Watch in the 116th Congress

With the 116th Congress convening in early January, several unfinished legislative priorities for SMACNA firms remain on the agenda. Each of the issues has bipartisan support, which is key with congressional control being split between parties.

The 115th Congress came to a close at the end of 2018 with victories for SMACNA on energy, tax extenders, FAA reform, and airport infrastructure. While these successes were significant, Congress left a great deal of top-priority legislation unfinished. SMACNA will continue to press for action on this unfinished work in 2019.

Multiemployer Pension Plans
While SMACNA is not expecting the Joint Select Committee on Solvency of Multiemployer Pensions Plans (JSC) to be reconstituted in 2019, efforts to help participants in failing plans and to address Pension Benefit Guaranty Corporation (PBGC) funding issues will continue. Importantly, the bipartisan sponsors of the 2018 GROW Act to authorize composite plans are also committed to continuing their efforts. New House Ways and Means Committee Chair Richard Neal (D-1st-Mass.), who sponsored a House bill in the last Congress to provide funds to bail out the failing plans, introduced a similar bill in early January. Although key members of Congress and staff at Ways and Means are familiar with composite plan design, new members and staff will need to learn about the issue.

The failed JSC effort not only stalled SMACNA’s separate effort to enact composite plans, but also served as a warning that going forward there will be Republican efforts to include tighter funding rules for multiemployer plans in any pension reform efforts. SMACNA will encourage Congress to take prompt action to modernize the multiemployer pension system by authorizing the hybrid composite plan model, making sure any Congressional action to tighten funding rules does not deepen the current crisis with unintended consequences and continuing to ensure that any PBGC premium increases are warranted and effective. SMACNA will be working with other construction employers to ensure that Republicans and Democrats understand that the viability of contributing employers is key to stabilizing the multiemployer defined benefit system.

Change Order Reform Expected to Advance
SMACNA contractors, chapters and staff lobbyists took a lead role in the last Congress in expressing support for The Small Business Payment for Performance Act of 2017, H.R. 2594. The bipartisan legislation would make reforms to quickly and fairly resolve change order disputes. The bill’s two co-sponsors, Rep. Brian Fitzpatrick (R-8th-Pa.) and Rep. Stephanie Murphy (D-7th-Fla.), have committed to reintroducing this bill in 2019 with high expectations for passage.

SMACNA Endorses Bid Listing Legislation
Late in the 115th Congress, Rep. Scott Peters (D-52nd-Calif.) introduced a bill to reduce bid shopping and ensure that the federal government gets quality subcontractors on construction contracts. The Stop Unfair Bid Shopping (SUBS) Act , H.R. 7221, would require general contractors on projects valued at $1.5 million or more to list as part of their original bid subcontractors that are proposed to perform work valued at more than $100,000. Rep. Peters promised SMACNA members during the annual convention held in San Diego in October that it would be a priority in the 116th Congress.

Additional Tax Incentives for HVAC Efficiency
SMACNA worked in 2018 to enact a tax extenders package as part of the Omnibus Budget Agreement signed into law in March. A feature of the extenders bill was to expand Internal Revenue Code  Section 179D permanently to include more tax incentives to boost HVAC retrofits of commercial buildings.

A second extenders package, awaiting a vote as 2018 ended, was similar to The Tax Extenders Act signed in 2018 that included:

• Extension of Internal Revenue Code Section 179D

• Tax incentives for solar and geothermal

• Efficient homes tax credits and a combined heat and power ITC

• Nuclear power financing and empowerment zone bond financing

Neal has indicated he expects early action in the 116th Congress on most of the bill’s provisions.

Advancing A Comprehensive National Energy Efficiency Policy
After nearly a decade of trying to pass a National Energy Policy, SMACNA has been working to pass a major energy package in both the House and Senate with residential, commercial, industrial, and public energy efficiency provisions to stimulate construction. The key components include:

• The Energy Savings and Industrial Competitiveness Act, with outstanding numbers of bipartisan House and Senate co-sponsors. It awaited Senate passage as the 115th Congress adjourned. Optimism is high that House passage is probable this year. An energy package is a top priority for Senate Energy Committee Chair Lisa Murkowski (R-Alaska) in 2019.

• SMACNA will again be advocating for The Energy Savings Through Public-Private Partnerships Act, where private sector service companies finance and install new energy efficient equipment at minimal or no upfront cost to the government. The bill now awaits a House reintroduction in 2019 by bipartisan cosponsors with SMACNA support.

• Another promising bipartisan bill slated to be reintroduced in the House and Senate is The Master Limited Partnership Parity Act. This initiative has an identical bill expected to gain passage in the Senate, which would significantly expand financing options for energy saving performance contracting (ESPC), building retrofits, industrial market efficiency projects, and combined heat and power/waste heat to power (CHP/WHP) systems.

• SMACNA continues its leading role to build support in the new Congress for the bipartisan Technologies for Energy Security Act. The legislation would be helpful for contractors on large CHP/WHP projects, including mechanical systems found on many large commercial, public and industrial buildings.

Project Labor Agreements and Davis-Bacon Act
In 2018, attacks on PLAs and Davis-Bacon laws were turned back by significant margins. Now, with a Democratic House, SMACNA anticipates record support for prevailing wages and considering PLAs on most construction-related legislation based on statements from members of the House leadership.

Infrastructure Plan to Repair Public Buildings, Schools and Airports
SMACNA was an early endorser of the White House plan for a massive 2018 infrastructure proposal. Members advocated for funding to boost repair, retrofit, and new construction of public facilities nationwide, especially the Federal Aviation Administration (FAA) Act reauthorization, which passed in October. SMACNA will again be enthusiastically supporting The Streamlining Energy Efficiency for Schools Act and other bills funding nationwide retrofit and renovation of schools using public-private partnerships and direct funding.

SMACNA members are encouraged to educate their new members of Congress about these 2019 legislative initiatives and contact them through SMACNA’s Take Action web page www.smacna.org/advocacy/take-action.