Legislative Alerts

Brief summary of how the recent PA budget effects GCAP issues.

Finally, the legislature did not act to extend the Education Empowerment Act which included the Mandate Waivers Program. Under the Mandate Waivers initiative, school districts were able to seek relief from Pennsylvania’s archaic Separations Act. Even though the program expired on June 30th, GCAP will keep working with its education and industry partners to find a way to give school districts the option of utilizing single prime when doing so makes the most sense for them. In the meantime, GCAP will continue to dispel the myth that bidding projects both ways ensures the best price in school construction.

GCAP is also monitoring work by the Senate Labor and Industry on HB 400. This legislation is intended to help the Commonwealth identify those bad actors who intentionally misclassify workers as independent contractors to avoid paying taxes, insurance costs and payroll deductions or to hire illegal aliens.

SB 601 – legislation authored by Sen. Pat Browne (R-Lehigh) – will protect contractors from being taxed twice for the same work via a business privilege tax. GCAP continues to work on the bill which would prevent double taxation on companies when they have their permanent base of operations in one municipality and a temporary job site trailer in another.

Also of “budget” importance to Pennsylvania construction was the agreement to invest $600 million in capital construction and renovation projects through the Redevelopment Assistance Capital Projects program (RACP). As a result of legislation passed in conjunction with budget, funding will be made available for dozens of shovel-ready projects across the Commonwealth as well as future construction initiatives of all sizes and duration.

For most of the late spring and early summer, the most pressing issue in Harrisburg was passage of an “on-time” state spending plan for Fiscal Year 2010-11. While not without some last minute twists and turns, the Pennsylvania General Assembly presented HB 2279 (the Commonwealth’s 2010-11 General Fund budget) to the Governor on June 30th. As you have undoubtedly read already, it was the first “on-time” budget for Governor Rendell, and also his last.

Assuming receipt of $850 million in federal FMAP funds – an assumption questioned by some in the State Capitol – HB 2279 keeps state spending almost level when compared to the previous fiscal year. In addition, the budget bill signed by the Governor does not call for any new or increased taxes – especially those that would have been most harmful to companies in the Pennsylvania construction industry. At one point in the process, the discussion had focused on adding state’s sales tax to new items, including professional services (i.e. architectural and legal fees), to help increase state revenues. GCAP and the rest of the Commonwealth’s business community worked hard to educate lawmakers on the tremendously harmful impact such a decision would have.

If FMAP funds do not come, state budgeteers will need to march back to the negotiating table to figure out a way to close an $850 million hole so stay tuned.

Regional Director Walter Palmer, along with GBCA counsel and staff met with the Governor’s Secretary of Legislative Affairs, Colleen Kopp to discuss why GCAP opposes the Commonwealth crafting a PLA for SCI Graterford without having the contractors’ group at the table. Palmer discussed with the Kopp the ways in which GCAP could assist the Commonwealth in negotiating the best terms for a PLA at the Montgomery County prison. For more information about the meeting, please call contact Terry McDonough at 717-731-6272 or keystonecontractors@verizon.net.

As a follow-up to testimony provided before the Senate Education Committee, GCAP sent a letter to the Committee reiterating the extremely positive impact a mandate waiver from the Separations Act continues to have on a major construction project at the A.W. Career Center near Pittsburgh.

GCAP confirmed for the Committee that not only did Uhl Construction’s initial bid come in lower than what the school had budgeted, but the single prime delivery method is allowing the school to do additional work that will make the building LEED certified at the silver level while still being on time and UNDER budget.

Rep. Ron Miller (R-York) has introduced HB 2499 which would extend the Mandate Waivers program without imposing the requirement that a school district bid a project both single prime and multi-prime before receiving a waiver. GCAP is pleased that Rep. Miller is spearheading this legislation and will continue to work with him on it. The bill has been referred to the House Education Committee where it will begin its journey through the legislative process. For more information about the bill, please call contact Terry McDonough at 717-731-6272 or keystonecontractors@verizon.net.

A recent letter by Governor Rendell’s Secretary of Legislative Affairs to the Chairs of the Senate Labor and Industry Committee has put House Bill 400 (Construction Workplace Fraud Act) on hold – at least temporarily.  While the Governor supports efforts to protect workers and employers from those skirt the law when it comes to classifying employees, Secretary Colleen Kopp informed Sens. John Gordner (R-Columbia) and Christine Tartaglione (D-Philadelphia) that limiting such an effort to just the construction industry is not the right approach.  According to the letter, the Governor wants the Senate to amend House Bill 400 so that its provisions will apply to all industries.

Senate Committee staff had been working on an omnibus amendment to House Bill 400 that GCAP does not oppose.  If the legislature and the Governor can reach an agreement on what the bill should and shouldn’t cover, GCAP will review any final amendatory language and formally submit its position on the bill before it moves forward in the legislative process.