Category: News Line

In a Feb. 4 letter to President Joe Biden, ABC expressed concerns about the “expansion of existing policies that needlessly limit competition and increase costs on taxpayer-funded federal and federally assisted construction projects.”

The letter, published in its entirety below, addresses the desire to prevent government-mandated project labor agreements on federal and federally assisted construction projects so that ABC and the Biden administration can work together to “create quality jobs for all of America’s workers to help the economy rebound from the COVID-19 crisis and Build Back Better.”

The Fight for Fair and Open Competition Continues

ABC will continue to advocate for fair and open competition on taxpayer-funded construction contracts before the Biden administration and the 117^th Congress.

ABC’s campaign for fair and open competition helped prevent PLA mandates and preferences on 99% of federal contracts exceeding $25 million from FY2009-FY2020, preventing PLA requirements on 1,877 contracts worth a total of almost $116.1 billion so all qualified firms could fairly compete to win these contracts.

ABC contractors have taken advantage of a level playing field. From FY2009-FY2020, ABC member prime contractors won 57.5% of the value of large-scale federal contracts subject to Obama’s pro-PLA Executive Order 13502. In total, ABC members have won 976 contracts valued at $67.5 billion.

Since President Obama issued his pro-PLA Executive Order 13502 in 2009, 26 states have responded to the threat of discriminatory PLA mandates and preferences by enacting Fair and Open Competition Act legislation or executive orders prohibiting government-mandated PLAs on state, local and publicly funded construction projects to some degree.

Unfortunately, some of these states have rolled back common-sense FOCA measures following Democratic party takeovers of state government, bringing the total number of current states to enact pro-taxpayer FOCA measures to 25.

ABC’s efforts to enact state FOCA laws prevented government-mandated PLAs on $633 billion worth of state and local construction capital outlay through the end of 2019.

Despite the campaign’s track record of success, government-mandated PLAs remain a threat to free enterprise and fair and open competition in certain markets.

Some municipalities and eight states controlled by union-friendly Democrats have enacted legislation or executive orders pushing the use of government-mandated PLAs on state, state-assisted and local public works projects, shutting out qualified contractors on certain contracts in California, Connecticut, Hawaii, Illinois, New Jersey, New York and Washington—and major municipalities including Chicago, Los Angeles, Honolulu, New York City and Philadelphia—from opportunities to rebuild their own communities.

In addition, it is unclear how many federally assisted contracts have suffered from PLAs mandated by state and local governments, but snapshots of data demonstrate it is significant.

For example, according to a U.S. Department of Transportation Federal Highway Administration January 2021 report, state and local lawmakers mandated PLAs on 513 state and local construction projects (totaling an estimated $12.88 billion) that received federal assistance and formal approval from the FHWA.

As America’s infrastructure needs continue to grow in the face of chronic underfunding, the construction industry unemployment rate hovers around 10% and hardworking taxpayers deserve the best possible construction products at the best possible price, ensuring fair and open competition is a win-win solution to help America Build Back Better.

February 4, 2021

The Honorable Joseph R. Biden Jr.
The White House
1600 Pennsylvania Avenue
Washington, DC  20500

Dear President Biden: 

Associated Builders and Contractors, a national construction industry trade association with 69 chapters representing more than 21,000 members,  stands ready to be a constructive partner with the Biden administration as we tackle rebuilding America’s infrastructure while ensuring safe workplaces, creating jobs and leading America’s economic recovery. 

ABC believes our roads, bridges, schools and water, energy and transportation systems need to be overhauled to accelerate a strong economic comeback and keep America competitive in a global economy. A recent industry report estimates that the U.S. infrastructure spending deficit will total $2.6 trillion by 2029 and more than $5.6 trillion by 2039. 

As we work together to address funding solutions that speed investments in transformational infrastructure projects, one of ABC’s top priorities is to ensure that all of the construction industry is welcome to participate in building all of America’s taxpayer-funded infrastructure projects. ABC is concerned about the expansion of existing policies that needlessly limit competition and increase costs on taxpayer-funded federal and federally assisted construction projects. 

For example, federal policies that encourage the use of government-mandated project labor agreements on federal  and federally assisted construction projects stand to increase construction costs by 12% to 20%,  resulting in the funding and construction of fewer projects and reduced jobs and opportunities for small businesses, minorities and women in the construction industry.

Real-world examples, experience and a survey of our membership  has found that government-mandated PLAs discourage competition from quality contractors and the 87.3% of the U.S. construction workforce who are not affiliated with construction unions,  which are given preferential treatment in typical government-mandated PLAs.

Problematic, anti-competitive terms in government-mandated PLAs require contractors to use union hiring halls to obtain most or all workers instead of their existing workforce; obtain apprentices exclusively from union apprenticeship programs; follow inefficient union work rules; and pay into union benefit and multi-employer pension plans that any limited number of nonunion employees permitted on the project will be unlikely to access unless they join a union and vest in these plans. Research estimates that nonunion employees on PLA projects suffer an estimated 20% reduction in compensation and contractors pay an extra 25% in benefits costs to cover this PLA wage theft to union plans, making firms less competitive against unionized firms. 

ABC supports fair and open competition and opposes government-mandated PLAs on federal and federally assisted projects because taxpayers deserve more efficient and effective policies that will encourage all qualified contractors and their skilled workforce to compete to build long-lasting, quality projects at the best price.

According to a model developed by Markstein Advisors,  every $1 billion in extra overall construction spending generates an average of at least 6,500 construction jobs, and every $1 billion in extra construction spending on infrastructure generates an average of at least 3,300 construction jobs. As the construction industry faces a 9.4% unemployment rate  due to the recession caused by COVID-19 and America’s infrastructure remains critically underfunded, we need to be doing all we can to maximize taxpayer investments in infrastructure while helping all construction workers find quality jobs to rebuild their communities.

The construction industry is in a unique position to help build America’s comeback, featuring careers with low barriers to entry, infinite opportunities for growth and family-sustaining salaries for people from all backgrounds and education levels, including women, minorities, veterans, students, non-graduates, and people seeking new careers, re-entry to the workforce or a second chance.
 
ABC delivers construction education through 800 ABC education programs at 1,400 locations nationwide, including innovative and flexible earn-while-you-learn models and industry-recognized apprenticeships in more than 50 professions—plus more than 300 U.S. Department of Labor-registered apprenticeship programs across 20 different occupations.
 
In 2019 alone, ABC members invested $1.5 billion to educate and upskill more than 1.1 million course attendees in craft, leadership and safety education to advance their careers in commercial and industrial construction. Safety education accounted for nearly half of the total workforce investment, averaging $1,147 per employee annually.  Ensuring the safety and health of the construction workforce in the workplace will continue to be a top priority as ABC members build America’s hospitals, schools, manufacturing facilities, roads, bridges and power plants.

Unfortunately, tomorrow’s construction industry workforce—those participating in government-registered apprenticeship and industry-recognized apprenticeship programs not affiliated with unions—would not be able to meaningfully participate on government-mandated PLA jobs, stifling a key pipeline of skilled labor needed to meet America’s future infrastructure needs.

ABC members stand ready to fairly compete for the opportunity to safely and ethically build and maintain America’s infrastructure. ABC would welcome the opportunity to discuss this issue further with your advisors. 

We look forward to working with you and your administration to advance policies that that create quality jobs for all of America’s workers to help the economy rebound from the COVID-19.

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On Jan. 29, the U.S. Department of Labor’s Wage and Hour Division announced the immediate end of its Payroll Audit Independent Determination Program, a nationwide program that assists employers in expediting the resolution of inadvertent overtime and minimum wage violations under the Fair Labor Standards Act.

Enacted in 2018 under the Trump administration, the PAID Program’s primary objectives were to resolve such claims expeditiously and without litigation, improve employers’ compliance with overtime and minimum wage obligations and ensure that more employees receive the back wages they are owed—faster.

According to a DOL news release, employers and workers are encouraged to call a WHD office in their area for FLSA compliance assistance; all calls are confidential. More information on the FLSA and other federal wage laws can be found on the DOL website.

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The Centers of Disease Control and Prevention has implemented provisions of President Biden’s Executive Order on Promoting COVID-19 Safety in Domestic and International Travel and will require the wearing of masks by all travelers into, within or out of the United States, e.g., on airplanes, ships, ferries, trains, subways, buses, taxis and ride-shares.

The release further states that the mask requirement also applies to travelers in U.S. transportation hubs such as airports and seaports; train, bus and subway stations; and any other areas that provide transportation. Transportation operators must require all persons on board to wear masks when boarding, disembarking and for the duration of travel. Operators of transportation hubs must require all persons to wear a mask when entering or on the premises of a transportation hub.

The order went into effect on Feb. 2. Additional information on the order and FAQs are available on the CDC website.

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On Feb 2, the U.S. Senate confirmed Pete Buttigieg to be secretary of the U.S. Department of Transportation by a vote of 86-13.  Secretary Buttigieg will be tasked with advancing President Joe Biden’s agenda in the Transportation Department, where he will oversee 55,000 employees. Secretary Buttigieg is expected to play an important role in promoting Biden’s sweeping environmental initiatives, and support the president’s push for an infrastructure plan.

Before Buttigieg was confirmed, ABC sent a letter to the Senate Commerce, Science and Transportation Committee stating that efforts to ensure competition and access to infrastructure contracts for all American businesses should not be opposed in favor of government-mandated project labor agreements on federally assisted construction projects that would strip the ability of many small businesses to compete fairly for projects.

ABC also raised the concern that an infrastructure proposal could exclude the overwhelming majority of America’s construction industry professionals who are not educated in federal registered apprenticeship programs. Not including recognition for industry-led programs in favor of only federal registered apprenticeship programs would reject the “all-of-the-above” approach that ABC has advocated for.

Sen. Todd Young (R-Ind.), who introduced the former mayor of South Bend, Indiana, at the hearing, led a discussion on the slow pace of federal project-approval process and further streamlining the NEPA permitting review process, an ABC-supported mission, to which Buttigieg said, “I think we should take every opportunity to make sure that these [review] processes are efficient and as much as is possibly doable—consistent, of course, with those safety and environmental goals—that they are speedy, that they’re not duplicative.”

Buttigieg’s confirmation elevates the former 2020 Democratic presidential candidate to a top post in the federal government. He is the 19^th transportation secretary and the fifth member of President Biden’s cabinet to be confirmed by the Senate.

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On Jan. 20, President Biden issued Executive Order 13985, Advancing Racial Equity and Support for Underserved Communities Through the Federal Government, which revoked EO 13950 issued by former President Trump regarding race or sex stereotyping or scapegoating in the workplace.

According to a U.S. Department of Labor news release, EO 13950 prohibited federal contractors and subcontractors from providing certain workplace diversity training and programs. Specifically, EO 13950 stated, “It shall be the policy of the United States not to promote race or sex stereotyping or scapegoating in the federal workforce or in the uniformed services and not to allow grant funds to be used for these purposes. In addition, federal contractors will not be permitted to inculcate such views in their employees.”

As part of EO 13985, the DOL’s Office of Federal Contract Compliance Programs is taking the following actions:

• OFCCP has rescinded the Frequently Asked Questions regarding EO 13950;
• OFCCP will cease operating the phone hotline and email address created to collect complaints related to contractors’ alleged noncompliance with Executive Order 13950;
• OFCCP will administratively close all complaints regarding alleged noncompliance with Executive Order 13950 received through the hotline or any other means. To the extent possible, OFCCP will notify complainants and affected employers accordingly; and
• OFCCP will not enforce any of the provisions required by Section 4(a) of EO 13950 contained in government contracts or subcontracts to the extent those provisions have already been included.

ABC general counsel Littler Mendelson P.C. wrote an analysis on the Biden EO, and more information can be found on the DOL website.

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ABC PAC has raised $83,000 in two weeks, which includes twelve max-out contributions of $5,000. Over the 2021-2022 election cycle, ABC PAC is tasked with raising $1,800,000. ABC would like to thank ABC members, chapters and staff who have generously contributed this calendar year and will continue to contribute over the next couple of years.

The purpose of ABC PAC is to work within the federal election process to further the goals of ABC by advocating for core issues, which include project labor agreements, the Davis-Bacon Act and the right to a secret ballot.

Federal law requires members to sign a prior authorization form in order for the executive or administrative personnel of the member corporation to be solicited by ABC PAC. ABC members can complete the required prior authorization form through this online portal.

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Following the inaugural ceremonies for President Joe Biden and Vice President Kamala Harris, the president is set to implement 17 executive actions through executive orders, presidential memos and agency directives, affecting a range of federal policies, including immigration, economic relief, climate change and the COVID-19 pandemic. These actions also seek to dismantle policies implemented by the Trump administration over the past four years on these critical issues. A summary of these actions was sent to news organizations this morning and can be viewed in this fact sheet.

Of note, President Biden will sign a presidential memorandum to ensure the continuation of the Deferred Action for Childhood Arrivals program that provides temporary protection from deportation and employment eligibility for undocumented immigrants brought to the United States as children. The memo will also urge Congress to pass permanent protections and a pathway to citizenship for DACA recipients. Biden will also end the Trump administration’s national emergency declaration, which was used to justify allocating certain federal funds for a border wall.

President Biden also alluded to his regulatory agenda in today’s actions, issuing a presidential memo to withdraw the Trump administration’s executive orders on the regulatory process and will direct the administration and federal agencies “to immediately review and take appropriate action to address federal regulations and other executive actions taken during the last four years that were harmful to public health, damaging to the environment, unsupported by the best available science or otherwise not in the national interest.” He further stated that “regulations are an important tool for the federal government to address the crises facing the nation.”

Important to his efforts to provide 100 million vaccinations in his first 100 days in office, President Biden will sign an executive order “creating the position of COVID-19 response coordinator, who will report directly to the president and be responsible for coordinating all elements of the COVID-19 response across government, including managing efforts to produce, supply and distribute personal protective equipment, vaccines and tests.” The president also seeks to provide economic relief for those affected by the virus through an extension of federal eviction and foreclosure moratoriums and extension of the pause on student loan interest and principal payments.

ABC will continue to provide updates on presidential actions and their impacts on the construction industry in Newsline.

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On Jan. 15, the U.S. Department of Transportation’s Federal Aviation Administration issued its final rule amending the agency’s 2016 final rule to allow the operation of small unmanned aircraft systems, or drones, at night and over people under certain conditions without obtaining a waiver. In 2019, ABC submitted comments on the FAA’s proposed rule, welcoming the agency’s efforts to ease certain restrictions on the use of small UAS without compromising the FAA’s valid safety objections.

According to an FAA executive summary of the final rule, the rulemaking establishes four new categories of small UAS for routine operations over people and also allows for routine operations over moving vehicles. Additionally, the final rule allows for drone operations at night under certain conditions, such as the requirement for remote pilots to complete online recurrent training which will include night subject areas. The online recurrent training will be offered free of charge to remote pilots.

The use of this technology has had an immensely positive impact on our economy that will continue to grow in the future.

In addition to the final rule on drone operations, the FAA issued a final rule requiring the remote identification of drones, which includes three ways to comply with operational requirements:

• Operate a standard Remote ID drone that broadcasts identification and location information of the drone and control station;
• Operate a drone with a Remote ID broadcast module (may be a separate device attached to the drone), which broadcasts identification, location and take-off information; or
• Operate a drone without Remote ID but at specific FAA-recognized identification areas.

Both final rules will go into effect on March 16, 2021. More information can be found on the FAA website.

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On Jan. 13, one day after the U.S. House approved a largely symbolic resolution calling on Vice President Mike Pence to invoke the 25^th Amendment to remove President Trump following last week’s deadly attack on the U.S. Capitol, the president was impeached for a second time by a vote of 232-197 (5 not voting), a first in the country’s 244-year history.

The single article of impeachment, drafted by Reps. David Cicilline (D-R.I.), Ted Lieu (D-Calif. and Jamie Raskin (D-Md.) charges Trump with incitement of insurrection. While the president’s first impeachment—for abuse of power and obstruction of Congress—only received a single non-Democratic vote in the House, then-Republican Rep. Justin Amash (Mich.), this impeachment effort garnered ten Republican votes, including the House Republican Conference Chair Liz Cheney (R-Wyo.).

With the vote to impeach, House Speaker Nancy Pelosi will decide when or if to send the article of impeachment to the U.S. Senate. With the Senate not scheduled to reconvene until Jan. 19, it is likely that an impeachment trial and any vote on conviction would not conclude until days or weeks into President Joe Biden’s administration.  

Further, should a two-thirds majority in the Senate vote to convict President Trump on the article of impeachment, it would then only require an additional majority vote to disqualify Trump from seeking the presidency ever again.

The legislative business of the 117^th Congress and President Biden’s first days in the White House could also be affected by the impeachment process, with a Senate trial potentially delaying cabinet confirmations and other business such as passing additional COVID-19 relief.

ABC will continue to update members on any further legislative considerations regarding impeachment.

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Following the approval of an additional $284 billion in funds for the Paycheck Protection Program in December, the U.S. Small Business Administration, in consultation with the U.S. Department of the Treasury, has reopened the PPP for new borrowers and certain existing PPP borrowers.

According to an SBA news release, initially only community financial institutions will be able to make First Draw PPP Loans on Monday, Jan. 11, and Second Draw PPP Loans on Wednesday, Jan. 13. Shortly thereafter, the PPP will open up to all other participating lenders.  

Key updates to the PPP include the following:

• PPP borrowers can set their PPP loan’s covered period to be any length between eight and 24 weeks to best meet their business needs
• PPP loans will cover additional expenses, including operations expenditures, property damage costs, supplier costs and worker protection expenditures
• The program’s eligibility is expanded to include 501(c)(6)s, housing cooperatives and destination marketing organizations, among other types of organizations
• The PPP provides greater flexibility for seasonal employees
• Certain existing PPP borrowers can request to modify their First Draw PPP Loan amount
• Certain existing PPP borrowers are now eligible to apply for a Second Draw PPP Loan

A borrower is generally eligible for a Second Draw PPP Loan if the borrower:

• Previously received a First Draw PPP Loan and will or has used the full amount only for authorized uses
• Has no more than 300 employees
• Can demonstrate at least a 25% reduction in gross receipts between comparable quarters in 2019 and 2020

SBA and Treasury also released the following guidance to assist small business with the latest round of PPP funds, which will be made available through March 31, 2021:

Those that qualify can access the First Draw borrower application and Second Draw borrower application on the SBA website. More information on the PPP can be found on the SBA and Treasury Department websites.

ABC has followed the implementation and additional revisions to the PPP and submitted comments on previous rulemakings related to the program and will continue to provide updates on the PPP through Newsline.

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