AGC Legislative Update January 2014

1. AGC Legislative UpdateJanuary 2014 Brian J. Lenihan Director, Tax, Fiscal Affairs, and Accounting Associated General Contractors of America 202.547.4733|lenihanb@agc.org

2. AGC Financial Issues Forum Winter Meeting View of the Landscape • Odd-numbered years, lawmakers spend more time in the Capitol and traditionally see the heavy lifting of legislative scut work. More votes are cast and about two-thirds of all bills are introduced. • During this even-numbered year, legislating time will be interrupted by the usual “district work periods” plus an additional five-week election break (House in session for 112 days). • Large bills ready for floor action (i.e. WRRDA & Farm) may be the only trains moving. • Senate Majority Leader executed an unprecedented party-line rules change, limiting filibusters, Republicans erupted and warned of spillover effects this year. • House Majority Leader outlined an agenda that was vague. “Several outstanding issues may be brought to the floor over the next few months, including: the intelligence authorization, flood insurance, as well as legislation related to trade and immigration.”

3. AGC Financial Issues Forum Winter Meeting Appropriations • Lawmakers return to Washington this week, facing an extremely abbreviated timeline to move a $1.012 trillion spending package, which would cover government operations through September 30. • Appropriators plan on moving as quickly as possible in the days ahead in order to limit opposition and meet strict deadlines to pass an “omnibus”  which would allocate the top-line level among the 12 individual spending bills that fund all discretionary programs for fiscal 2014 – clearing the deck for policy fights over FY15. • January 15 is the deadline for when the current continuing resolution expires and triggers another government shutdown. • AGC advocating for reversing $4 billion in sequestration cuts to federal construction programs, lifting of current prohibition on new projects and fully funding federal transportation programs.

4. AGC Financial Issues Forum Winter Meeting Debt Limit • Treasury Secretary Lew has said that his department can avoid default on the $17.3 trillion federal debt for about a month after the suspension of the debt ceiling ends on February 7 • Senate Minority Leader McConnell stated that he couldn’t imagine that the party would back an increase in the debt limit without demanding some conditions. • House Republicans will work on their debt-limit strategy during the party’s retreat in Cambridge, Maryland, January 29-31. Part of their discussion will involve concessions they may seek to extract from the White House and Senate Democrats.

5. AGC Financial Issues Forum Winter Meeting Immigration Reform • Senate comprehensive bill passed June ‘13 (14 GOP Senators Supported) • Met AGC principles: Earned legalization for existing workers; No vicarious liability; Maintain “knowing” standard; Limit debarment as penalty/keep FAR stds; Federal preemption; E-verify for new hires • Bill failed to provide a workable guest worker program/future flow (Caps workers @ 15,000/year for construction only) • House GOP leadership will not hold vote on senate bill, opting for piecemeal approach • Bills that have passed House Committees include: Border Security; Mandatory E-Verify System for Employers for All New Hires; High-Skilled Visas; Interior Enforcement; Agricultural Guestworker Program • Bills under development: Low-Skilled Visa program and DREAM Act like. • House Timing – later part of the Spring? (after budget and debt limit debates and after 2014 GOP primary season)

6. AGC Financial Issues Forum Winter Meeting Pension Reform • AGC continues to lobby with Building & Construction Trades Department, (BCTD) • Legislative language being drafted (based on 18 month joint labor/mgmt commission) • Technical corrections to PPA (sunsets Dec. ‘14) • Tools for “Deeply Troubled Plans” including benefit suspensions (most controversial) • New plan design (hybrid model between DC and DB plans) • Seeking congressional champions • Dems wary that they are supporting benefit cuts • GOP wary that it is “union bailout” • Some non-BCTD labor groups and AARP opposing b/c of benefit cuts • Hope for enactment by end of year

7. AGC Financial Issues Forum Winter Meeting Questions Brian J. Lenihan Director, Tax, Fiscal Affairs, and Accounting Associated General Contractors of America 202.547.4733|lenihanb@agc.org