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Treasury Issues Proposed Rule on State and Local Tax Deduction Workaround

On Aug. 23, the Department of Treasury issued a proposed rule that seeks to limit the availability of a tax planning technique that some northeastern states have adopted in the wake of tax reform. The Tax Cuts and Jobs Act – passed in December 2017 – limited the amount of state and local taxes that an individual can deduct to $10,000 per year.  Since then, a number of states – including New York, New Jersey, and Connecticut – have adopted new laws that allow taxpayers in those states to pay their state taxes to a state-sponsored “charity” and receive a partial credit from the state for those taxes paid.
For example, under New York’s proposal, individuals can “donate” a dollar to a state sponsored charity and receive an 85 percent credit against their state tax liability, and 95 percent against their local tax liability.  In theory, under this proposal, because charitable contributions were left uncapped in tax reform, an individual would be able turn their (capped) state tax payments into (uncapped) charitable contributions.
However, the rule proposed by Treasury last week seeks to severely cut back on the utility of these workarounds. Under the proposed rule, a taxpayer would only be able to deduct the uncredited portion of their payment to the state. So, in the New York example above, a taxpayer who makes a $100 contribution to the state-sponsored charity and receives and $85 credit from the state, would only be able to deduct $15 on their federal return.  This proposed rule could also impact additional states that have set up similar arrangements for private school vouchers.
Importantly, this rule does not affect proposals that some states are considering that would provide relief to owners of pass-through businesses, of which AGC is supportive.
For more information, contact Matt Turkstra at [email protected], or (202) 547-4733.

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EPA Determines Existing Regulations Sufficiently Protect Against Hazardous Substance Releases

On August 24, AGC filed joint comments in support of a proposal by the U.S. Environmental Protection Agency (EPA) concluding the existing regulatory framework adequately prevents and contains discharges of hazardous substances.  AGC supports the agency’s proposal not to initiate a new regulatory regime addressing spills of hazardous substances under section 311 of the Clean Water Act. The joint letter expands upon the legal justification for EPA’s proposal, affirms that EPA has the authority to take this action, and augments the agency’s information on the “potential overlap between existing requirements under statutes and regulations implemented by EPA and by other federal agencies...”.
In addition to the overlapping regulations evaluated by EPA in the proposal, the joint letter highlights additional, related protective (and punitive) requirements within the National Pollutant Discharge Elimination System program, pretreatment programs relating to effluents entering a publicly owned treatment works, spill cleanup liability, and release reporting that serve to protect against releases. These existing requirements further support EPA’s proposal that additional regulation would provide de minimis regulatory benefit.


On the joint letter, AGC was joined by the U.S. Chamber of Commerce, American Chemistry Council, American Forest & Paper Association, American Fuel & Petrochemical Manufacturers, National Mining Association, and Utility Solid Waste Activities Group.

For more information, contact Leah Pilconis at [email protected] or (703) 837-5332.

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Transportation Department and Congress Seek Input on Hours of Service

Impacted AGC Members Should Comment and Contact their Representatives
As previously reported, the U.S. Department of Transportation’s Federal Motor Carrier Safety Administration announced that it is seeking public comment on revising four specific areas of the current hours-of-service regulations. AGC is preparing a response to the proposal on behalf of its member companies; however, we also encourage Individual members to submit comments by the September 24 deadline. For additional information or to leave a comment please click here.
AGC is also working in support of the HOURS Act, which would expand the logging exemption for short-haul drivers from 100 to 150 miles, expand the on-duty time to 14 hours and eliminate the 30-minute rest requirement. Certain paperwork requirements would also be eased, and the Federal Motor Carrier Administration would be encouraged to move expeditiously to finalize a rule on the use of sleeper berth to meet off duty provisions. AGC is urging members to contact their Congressional representatives through AGC’s Legislative Action Center.
For more information, contact Sean O’Neill at [email protected] or (202) 547-8892.

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Tell Congress that the Time for Infrastructure Investment is Now

As Congress returns from their August recess, unresolved issues towards enacting a comprehensive infrastructure plan remain.  As previously reported, House Committee on Transportation and Infrastructure Chairman Bill Shuster released a discussion draft to make significant investments in our nation's infrastructure. Whether or not this proposal or any other infrastructure plan is successful depends upon you, and other construction industry professionals, collectively calling upon your federally elected officials to put partisanship aside and do what is right for our nation. Contact your U.S. representative so that they can hear YOUR voice and understand that investing in and improving our nation’s infrastructure helps America prosper.
The Shuster plan calls for investing a significant sum in America's aging and over-burdened infrastructure, streamlining the federal environmental permit and review processes to help deliver needed projects faster, calling for long-term solutions to funding existing federal infrastructure programs, including the Highway Trust Fund and the Harbor Maintenance Trust Fund.
For more information, contact Sean O’Neill at [email protected] or (202) 547-8892.

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WebEd: The Construction Workforce Outlook

In-Depth Analysis of Autodesk/AGC Workforce Survey Data & More
Register today for the AGC member complementary ($79 for non-members) WebEd entitled: “The Construction Workforce Outlook: Challenges, Best Practices and Solutions” scheduled for Thursday, September 6 from 2:00 p.m. to 3:00 p.m. eastern time. During this WebEd, registrants will from a panel of experts who will review the results of the 2018 AGC Construction Workforce Survey supported by AutoDesk, detailing national, regional and state workforce data, and highlight a number of best practices and solutions to workforce shortages.
For more information or to register, click here.

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Eighty Percent of Contractors Report Difficulty Finding Qualified Craft Workers to Hire

AGC Releases Workforce Development Plan 2.0
Eighty percent of construction firms report they are having a hard time filling hourly craft positions that represent the bulk of the construction workforce, according to the results of an industry-wide survey released today by Autodesk and the Associated General Contractors of America (AGC). Association officials said shortages pose a significant risk to future economic growth.
AGC also released a new Workforce Development Plan that identifies steps federal officials should take to support construction workforce development, including doubling the funding for career and technical education over five years and allowing more people with construction skills to legally enter the country. The plan also outlines new recruiting steps the association is taking, including launching a targeted digital advertising recruiting campaign and investing in innovative workforce solutions.
For more information, contact Jim Young at [email protected] or (202) 547-0133 Claiborne Guy at [email protected] or 703-837-5382.

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Advanced Safety Management Training Course

October 17-19 in Arlington, VA, 10 Seats Left!
This unique three–day course provides construction safety and health professionals with the next–level knowledge required to successfully manage a company–wide safety program. Moving beyond the basics of Focus Four training, AGC’s Advanced Safety Management Training Program will give participants a more holistic view of safety’s role in project and company success, as well as advanced tactics and best practices for managing all aspects of a corporate safety program. Participants will also focus on the importance of "selling" safety throughout the organization and methods to generate buy–in from different audiences. Full details on the course and links to registration can be found here.

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AGC Trains VA Resident Engineers on Partnering, Bidding, and More

Last week, AGC members met with the Department of Veteran Affairs (VA) resident engineers from across the country for an interactive training session at the VA Acquisition Academy in Frederick, Md. AGC members explained the importance of early communication by VA, gave incites on the type of information that industry seeks in order to qualify an opportunity, and the value associated with certain types of VA engagements (e.g. RFIs, one-on-ones, partnering, industry days). AGC members spoke about how different factors might influence the decision towards either bidding or not bidding (e.g., costs of competition, risks, acquisition strategy, past acquisition practices of customer, competitive analysis, etc.).  VA resident engineers engaged in team exercises where they would brainstorm on the timelines of the different steps involved.
AGC frequently engages in training sessions with federal agencies and remains dedicated to further educating federal agencies on construction process.
For more information, contact Jordan Howard at [email protected] or (703) 837-5368.

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FAR Council Adopts Federal Contractor Paid Leave Interim Rule without Change

Administration Finalizes the Requirement, Extinguishing Hope of Repeal/Improvement
The Federal Acquisition Regulatory (FAR) Council on August 22 issued a final rule adopting a December 2016 interim rule that implements former-Pres. Obama’s Establishing Paid Sick Leave for Federal Contractors executive order and the related September 2016 final rule issued by the U.S. Department of Labor (DOL).  
The new rule, which takes effect immediately, adopts the interim rule without any change and contains the same employer mandates as the DOL rule.  Accordingly, contractors need not alter their policies or practices in response to this latest action, provided that they are in compliance with existing regulations and federal contracts.  The action does send a signal, however, to those still holding out hope that the Trump Administration might rescind the executive order and related regulations:  chances are extremely slim.
The adopted interim rule requires federal contract solicitations issued on or after January 1, 2017, and resultant contracts to include a new FAR Clause 52.222-62 incorporating paid leave mandates.  It applies to all federal contracts and subcontracts at all tiers that will be performed within the U.S.
It does not apply to contracts with state government agencies even if the contracts are federally funded.  (AGC has found that some state departments of transportation have erroneously incorporated the mandates into contracts for federally assisted highway projects.  Contractors facing this situation may contact AGC for assistance.)
The following resources offer further guidance on paid leave mandates for federal contractors:

For more information, contact Denise Gold at [email protected] or Claiborne Guy at [email protected].

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FMCSA Seeks Comment on Hours of Service Rule Changes

Impacted AGC Members Should Comment
The U.S. Department of Transportation’s Federal Motor Carrier Safety Administration (FMCSA) announced that it is seeking public comment on revising four specific areas of the current hours-of-service (HOS) regulations. These four main areas under consideration for revision are: (1) expanding the current 100 air-mile “short-haul” exemption from 12 hours on duty to 14 hours on duty to bring consistency to the rules for long-haul truck drivers, (2) extending the current 14-hour on-duty limitation by up to two hours when a truck driver encounters adverse driving conditions, (3) revising the current mandatory 30-minute break for truck drivers after eight hours of continuous driving and (4) reinstating the option for splitting up the required 10-hour off-duty rest break for drivers operating trucks that are equipped with a sleeper-berth compartment. AGC will be submitting comments in support of these revisions and requesting additional changes.
Individual members are also encouraged to submit comments by the September 24, 2018 deadline. For further details please review the proposal.
AGC maintains that construction industry truck drivers were never intended to be covered by FMCSA’s hours of service (HOS) restrictions, which were originally aimed at long-haul cross-country drivers. However, many construction drivers are impacted and the problem has become more pronounced because of the recent requirement that drivers must use Electronic Logging Devices (ELDs) to record their on-duty times. While a variety of exemptions have been granted to segments of the construction industry – such as asphalt and ready mix delivery and certain trucks used in paving operations – these are limited and cause confusion.
AGC is also working in support of the HOURS Act that would expand the logging exemption for short-haul drivers from 100 to 150 miles, expand the on-duty time to 14 hours and eliminate the 30-minute rest requirement. Certain paperwork requirements would also be eased and the Federal Motor Carrier Administration would be encouraged to move expeditiously to finalize a rule on the use of sleeper berth to meet off duty provisions. AGC is urging members to contact their Congressional representatives through AGC’s Legislative Action Center.
For more information, contact Brian Deery at [email protected] or (703) 837-5319.

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