Looking Back at 2011, Looking Forward to 2012

The last twelve months have been interesting, aggravating and not very productive. Between Election Day 2010 and Christmas Day 2010, the President, House and Senate agreed to a continuing resolution that funded the government through March, they agreed to an extension of the Bush tax rates, an extension of emergency unemployment benefits and a payroll tax holiday that reduced the employee portion of funds withheld for social security. Those 50 days between Nov. 2 and Dec. 25, 2010 was a temporary flurry of bipartisanship and productivity. There were sporadic outbreaks of bipartisanship over the last twelve months when Congress repealed the 1099 requirement, passed three trade agreements and finished the year with repeal of the 3 percent withholding requirement. There was a drama free six-month extension of the highway program in September after a dramatic shutdown of the FAA and a suspension of the tax revenues flowing into the aviation trust fund. FAA was subsequently temporarily reauthorized and the extensions of these two programs will hopefully turn into multiyear authorizations in 2012. For the most part, Congress and the American people complained about Congress. Republicans complained about Democrats and Democrats complained about Republicans.  Congress brought the government to the brink of shutdown in March when they couldn’t come to terms on reducing federal spending. In August, Congress threatened to endanger the United State’s credit rating while they fought over raising the debt ceiling and then reached a drama free agreement last week on the FY 2012 budget, giving us nine months before the threat of the next government-wide shutdown.  The majority of the bickering is due to the political nature of the election season.  Unfortunately, it is impossible to remove politics from legislating. The election season now lasts 24 months, not just 6 to 12. AGC will continue to work to achieve our legislative priorities for the 112th Congress (2011 and 2012) which include promoting private and public construction investment in a shrinking federal budget. AGC sees value in stabilizing government policies and creating permanent incentives or at least a permanent set of rules surrounding capital investment.  AGC also continues to push back against irrational government regulation that will create inefficiencies rather than improvements. We have been on constant vigil as certainty has been removed from public construction programs, uncertain tax policies make long-term planning impossible and the regulatory environment is peppered with a combination of ineffective and impractical new regulatory proposals. While there is recognition that the economy is bad and that certain construction programs are both necessary and economically beneficial, Congress has failed to address major infrastructure reauthorizations.  Congress is looking for alternative financing options and is warming up to ideas such as reauthorizing the existing highway program without imposing a 35 percent cut, creating a trust fund for water infrastructure and expanding the use of private activity bonds.  Each of these is a solid proposal, but all are caught up in the irrational expectation that it is easy to balance the federal budget if Congress just puts its mind to it. We have been successful with two key initiatives: the repeal of the 1099 mandate and the repeal of the 3 percent withholding.  Both were hugely wasteful, poorly targeted and widely derided after passage. With construction unemployment still in double digits, neither repeal bill put AGC members to work, but it did remove some of the useless regulations that are strangling efficiency.  The House has attempted this year to put the reins on major regulatory proposals. However, these attempts are only able to stop a few of the bad ideas being generated.  Many of those key policy riders are mentioned in the next story. The construction industry has a legitimate case to make construction front and center during any debate over jobs. AGC’s primary goals for the rest of this session of Congress include: jump starting privately funded construction, supporting Congressional oversight of federal agency rulemakings, and finally getting long-term authorizations enacted.  We are still looking for a permanent fix to death tax uncertainty.  We have fought numerous efforts by the DOL and the NLRB to achieve card check’s goals through decisions and rulemakings that make it harder for employers to communicate with their employees during organizing.  We are still looking for a way to restore stability to multi-employer pension plans.  We are guarding against regulatory efforts to push climate change that will limit economic growth.  Without bipartisan cooperation, we have been unable to foster any rational discussion about immigration. We have had, and expect to have, a lot of interaction with the federal agencies and Congress to ensure safety policies focus on safety, and not just on paperwork and penalties.  We are trying to repeal elements of Patient Protection and Affordable Care Act that do not work for our industry.  We have been extremely successful opposing Project Labor Agreements (PLAs).  The legislative efforts have not proved fruitful, but in working directly with the agencies and the procurement officials, we have developed a strong track record successfully blocking 41 attempts to impose PLA mandates on federal contracts. The 2012 outlook may provide some opportunities for action on multiyear transportation authorizations in the first quarter of the year before the Aviation and Surface transportation extensions expire.   The Administration will continue to issue more regulations. The expiration of the Bush tax cuts will force another battle over taxes at the end of 2012. AGC will make sure the construction industry’s priorities are front and center  in 2012. For more information, please contact Jeff Shoaf at (202) 547-3350 or shoafj@agc.org.