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AGC Seeks Federal Agency Change Order Improvements

Requests Data Reporting to Encourage Accountability
At AGC’s urging, the House of Representative’s Small Business Committee requested that the Government Accountability Office (GAO) conduct a review of the use of change orders on federal construction contracts. The review will examine at least one major civilian and one major defense agency with significant volumes of federal construction contracts. This bipartisan request is a direct result of AGC’s efforts with both parties in Congress to address the many issues associated with change orders.
Among the inquiries, the Committee asks GAO to request from the agency:


  • How long does it take, and should it take, for agencies to determine the cost impact of change orders and compensate the contractor?

  • What guidelines do agencies have for issuing and paying for change orders on the prime and subcontract levels?

  • What evidence exists of change order bundling?

  • What is the purpose of agencies engaging in bundling change orders?

  • How does change order bundling affect the ability of a contractor to obtain surety bonds?

  • Is there evidence that agencies otherwise may be acting in bad faith in delaying the settlement of change order requests for equitable adjustment?

AGC has previously called on the Federal Acquisition Regulation Council to improve the data federal agencies collect regarding the administration of change orders in response to the Council’s information request. AGC’s recommendations would require federal agencies to collect a range of data regarding the timeliness of action by the contracting officer (CO) in an effort to encourage greater CO accountability.
For more information, contact Jordan Howard at Jordan.Howard@agc.org or (703) 837-5368.

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Trump Releases FY 2018 Budget Outline

Mixed Bag for Infrastructure Accounts
on March 16, the Trump administration outlined its budget for fiscal year 2018, which calls for cuts to transportation, water and public housing infrastructure. However, the budget outline also calls for increased construction funding for the southern border wall and an unspecified amount for military construction to address “degraded facilities.” Notable policy initiatives include implementation of mandatory nationwide use of the E-Verify Program and a reduction of federal agency enforcement programs.
Specific highlights from the budget include:


  • Decreases to federal support for job training and employment service formula grants amid a construction workforce shortage;

  • Elimination of unspecified Occupational Safety and Health Administration training grants, which likely includes the Susan Harwood Safety Training grants that AGC has been a recipient of;

  • Elimination of funding for the unauthorized TIGER discretionary grant program, approximately a $499 million cut under the existing FY 2017 government funding bill;

  • Limited funding for the Federal Transit Administration’s Capital Investment Program (New  Starts) to projects with existing full funding grant agreements only;

  • Funding $900 million for the Nationally Significant Freight and Highway Projects grant program, authorized by the FAST Act of 2015, which supports larger highway and multimodal freight projects with demonstrable national or regional benefits;

  • Funding $2.3 billion for the Environmental Protection Agency’s (EPA) Water and Wastewater Infrastructure State Revolving Funds, a $4 million increase over the existing FY 2017 government funding bill;

  • Providing $20  million  for  the  Water  Infrastructure  Finance  and  Innovation  Act  program;

  • Elimination of the Department of Agriculture’s nearly $500 million Water and Wastewater Loan and Grant Program, instead relying on the private sector or other federal investments in rural water infrastructure, such as the EPA’s State Revolving Funds;

  • Elimination of $3 billion for  the Department of Housing and Urban Development’s Community  Development  Block  Grant  program; and

  • Reduction of the EPA’s Office of Enforcement and Compliance Assurance by $129 million compared to the existing FY 2017 government funding bill.

As with most presidential budgets, this document serves mostly in an advisory capacity to Congress, and many of the cuts proposed by the White House will face hurdles there. It should be noted that this budget document is a broad layout for how the Trump administration would like to see federal funds allocated. A more detailed budget is expected to come out in May. Additionally, the administration asked for a separate Security Supplemental of $30 billion for 2017. AGC will continue to call for adequate infrastructure investment and sensible construction industry policies as Congress considers the president’s budget.
For more information, contact Jordan Howard at Jordan.Howard@agc.org or (703) 837-5368.

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New Executive Order Seeks to Reorganize Federal Bureaucracy

AGC to Review for Suggestions
On March 13, the president issued an executive order aiming to merge duplicative agencies and eliminate unnecessary agencies. The “Comprehensive Plan for Reorganizing the Executive Branch” Executive Order calls on the Office of Management and Budget to develop a plan to achieve the order’s goals. The plan may consider whether some or all functions of a federal agency would be better left to state or local governments or the private sector; whether the federal agency operating costs are justified by the public benefits it provides; and whether federal agency mission redundancies can be eliminated or streamlined.
AGC will further review the order and provide suggestions for streamlining the federal bureaucracy as a means to reduce permitting delays and help deliver construction projects in a timelier manner. For more a more detailed account on President Trump’s Executive Orders from the construction perspective, click here.
For more information, contact Jimmy Christianson at 703-837-5325 or christiansonj@agc.org.

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U.S. House Passes Legislation to Rollback OSHA Rule Extending Statute of Limitations for Recordkeeping Violations

Contact your Senators and Help Us Repeal this OSHA Rule
On March 1, an AGC-supported resolution passed in the U.S. House disapproving an Occupational Safety & Health Administration (OSHA) rule designed to allow OSHA to issue citations for recordkeeping violations beyond the current six-month limit, up to five and a half years. This expansion of the statute of limitations exposes employers to liability for honest and inadvertent paperwork mistakes related to recordkeeping. The U.S. Senate introduced a similar bill (Sponsored by Senator Cassidy (R-La.) and cosponsored by Senators Hatch (R-Utah), Isakson (R-Ga.) and Daines (R-Mont.)) this week with a vote scheduled by April 7. AGC urges the Senate to support the House-passed bill.  Please contact your Senators and urge them to support repeal of this burdensome rule.
The December 2016 rule, Clarification of Employer’s Continuing Obligation to Make and Maintain an Accurate Record of Each Recordable Injury and Illness, was issued in response to a federal court ruling that found that OSHA could no longer issue citations beyond the six-month statute of limitation window that is detailed in the OSH Act. The rule is often referred to as the “Volks” rule after the construction company that successfully challenged the rule in court in 2012. For several years OSHA had been operating under the theory that it could issue citations for the entire five-year period during which employers are required to keep records for injuries and illnesses. With this rule, OSHA showed a clear attempt to circumvent the judicial branch and congressional intent with this rule.
For more information, contact Jim Young at youngj@agc.org or Kevin Cannon at cannonk@agc.org.

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Senate to Vote to Repeal Blacklisting Regulations Next Week

Contact Your Senators and Urge them to Support Repeal
In the final year of the Obama administration, federal agencies issued nearly 4,000 new regulations. Many of those regulations negatively impact the construction industry. Congress—through the Congressional Review Act (CRA)—has an opportunity to repeal just a handful of Obama-era regulations issued after approximately May 30, 2016.
Among the most unnecessary and burdensome regulations are those implementing the former president’s “Fair Pay and Safe Workplaces” Executive Order 13673, commonly called the Blacklisting Executive Order. The Senate is expected to vote to repeal the Blacklisting regulations early next week.  Contact your senators and ask them to support repeal of these regulations.
Under the Blacklisting regulations, both prime contractors and subcontractors would report violations of 14 federal labor laws and undefined state labor laws before contract award and again every six months after contract award on federal contracts (not federally-assisted contracts) exceeding $500,000. Federal contracting officers would then determine if contractors would be allowed to bid on federal construction work based on their labor law compliance record.
Such a process would introduce a significant degree of subjectively into the federal construction procurement process. It would allow federal contracting officers to effectively debar—or blacklist—companies without the protections of due process afforded under suspension and debarment proceedings. It would also layer a new federal procurement bureaucracy above contracting officers—in the form of labor compliance advisors—which would further delay the procurement process.
For more information, contact Jimmy Christianson at christiansonj@agc.org or (703) 837-5325.

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Trump Orders Unwinding of WOTUS Rule

Follows AGC’s Recommend Path
Following AGC’s recommendation to the presidential transition team in December, President Trump issued an Executive Order on Feb. 28 that begins the process of unwinding the “Waters of the United States” (WOTUS) rule.  Also in line with AGC’s recommendation, the Order calls for a new “review” of the WOTUS rule, stating that for any revised proposed rule, the EPA and Corps shall consider interpreting the term ‘navigable waters’ in a manner consistent with the opinion of the late Justice Antonin Scalia in the 2007 Supreme Court case, Rapanos v. United States. In keeping with the Executive Order, EPA and the Corps have issued a notice of intent to review/revise the WOTUS rule.
The Executive Order in and of itself does not remove the WOTUS rule from the books. Rather it merely directs the U.S. Environmental Protection Agency and U.S. Army Corps of Engineers — who issued the rule in 2015 — to begin the lengthy and complex regulatory process necessary to rescind or revise the rule. That process will take time, as it is subject to the same notice and comment rulemaking process that the rule underwent when it was written.  It will also be subject to legal challenge by environmental groups, which may use the government reports and documentation that the agencies used to justify the rule as ammunition against any changes.
The Order also directs the agencies to notify the U.S. Attorney General about the pending review of the WOTUS rule so he may take any such measures as he deems appropriate concerning any pending litigation related to the rule. But at this point, it remains unclear how this Order will impact current litigation. In the midst of this uncertainty, the Corps continues to use the 1986 regulations and applicable jurisdictional guidance (status quo as it existed before the new rule) in making jurisdictional determinations or taking other actions based on the definition of WOTUS.
AGC has been advocating on behalf of its members on this issue since the beginning. AGC submitted four sets of comments on the agencies’ 2014 proposed rule on the scope of their jurisdiction.  The agencies finalized a modestly improved rule in May 2015 and scheduled it to take effect in August 2015.  Many states and others challenged the rule in court.  The U.S. Court of Appeals for the Sixth Circuit has at least temporarily blocked the agencies’ implementation of the rule.  There is no deadline for the Sixth Circuit to make a final decision. AGC has spoken about the implementation of the 2015 rule with EPA and the Corps, including its potential impact on Clean Water Act permitting.  For information on the WOTUS rule and where it generally stands, click here and here, respectively.
For more information, contact Leah Pilconis at pilconisl@agc.org or (703) 837-5332. 

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AGC-Backed Regulatory Reforms Pass House

President Signs New Regulatory Reform Order
On March 1, the House passed three AGC-backed regulatory reforms that will help eliminate regulations that are obsolete, ineffective, overly burdensome or duplicative. These reforms bills come on the heels of several others that passed the House in January with AGC support.
While these reforms advance in Congress, the president issued another executive order aimed at reducing the regulatory burden. The Executive Order on Enforcing the Regulatory Agenda establishes task forces within each federal agency whose mission is to evaluate existing regulations and make recommendations to the agency head regarding their repeal, replacement or modification. This order complements the president's previous order that requires agencies to eliminate two regulations for each new regulation it issues.
For more information, contact Jimmy Christianson at christiansonj@agc.org or (703) 837-5325.

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Legislation Advances to Rollback OSHA Rule Extending Statute of Limitations for Recordkeeping Violations

Contact your Members of Congress and Help Us to Repeal this OSHA Rule
This week, legislation was introduced in the U.S. House of Representatives to block an OSHA rule that would allow OSHA to issue citations for recordkeeping violations beyond the current six month limit, up to five and a half years. This expansion of the statute of limitations from six months to five and a half years exposes employers to unfair liability for honest and inadvertent paperwork mistakes related to recordkeeping. Please contact your federal elected officials and urge them to support repeal of this burdensome rule.
The December 2016 rule was issued in response to a federal court ruling that OSHA could no longer issue citations beyond the six month statute of limitation window. The rule is often referred to as the “Volks” rule after the construction company that successfully challenged the rule in court in 2012. Prior to the bill’s introduction, a broad representation of 73 employer organizations joined AGC in a letter urging Congress to swiftly disapprove of the Volks Rule.
For more information, contact Jim Young at youngj@agc.org or (202) 547-0133.

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Pruitt Confirmed as New EPA Administrator

On Feb. 17, the U.S. Senate confirmed President Trump’s nominee to head the U.S. Environmental Protection Agency (EPA), former Oklahoma Attorney General Scott Pruitt, after contentious debate and on a 52-46 vote that fell largely along party lines.  Pruitt addressed EPA staff for the first time in his official capacity earlier this week, expressing the need for the agency to follow the “rule of law” and to bring regulatory clarity to businesses. Although he did not go into detail in his remarks, he also signaled an interest in partnering with states through federalism.
At this point, we are not clear on the specifics of President Trump’s plans for environmental policy. It has been widely reported in the press that Trump will issue significant new executive orders now that Pruitt is installed at EPA.  For his part, Pruitt made it clear during his appointment process that he plans to fulfill President Trump’s campaign promises to focus on “job-killing” regulations, and has focused on the Clean Power Plan and Waters of the US regulations specifically. One point where Pruitt has signaled bipartisanship is his vocal support for the Agency’s water & wastewater infrastructure mission. This comes on the heels of the Trump campaign’s promise to triple the funding for the State Revolving Loan Fund programs.
AGC supports AG Pruitt’s appointment and will work with him to promote a pro-construction agenda at EPA.
For more information, please contact Scott Berry at berrys@agc.org or Melinda Tomaino at tomainom@agc.org.

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House Panel Approves AGC-Supported Regulatory Reforms​

The House Oversight and Government Reform Committee passed three AGC-backed regulatory reform bills on Tuesday. The Searching for and Cutting Regulations that are Unnecessarily Burdensome (SCRUB) Act, Regulatory Integrity Act, and Office of Information and Regulatory Affairs (OIRA) Insight, Reform and Accountability Act collectively would establish mechanisms to unwind obsolete, duplicative, overly burdensome, and ineffective regulations. The bills will likely move to the House floor for consideration in the coming weeks.
AGC also supported several other regulatory reform bills that the House passed in January. Those bills are pending action in the Senate, which has been preoccupied with protracted cabinet confirmations.
For more information, contact Jimmy Christianson at christiansonj@agc.org or (703) 837-5325.

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