Legislative Alerts

N E W S R E L E A S E

December 9, 2009

McDonough tells House Republican Policy Committee that the General Contractors Association of Pennsylvania opposes the mandated use of project labor agreements in state contracts.

Harrisburg – General Contractors Association of Pennsylvania (GCAP) Executive Director, Terrence McDonough told a State House panel today that GCAP opposes the mandated use of project labor agreements (PLAs) in state contracts. Click here to see his complete testimony.

Appearing before the House Republican Policy Committee, McDonough told lawmakers that GCAP opposes government-mandated PLAs because they restrain competition, drive up costs and disrupt local collective bargaining.

“While GCAP members regularly employ a union workforce, our general contractors have no seat at the table when a PLA is negotiated between a public owner and a union,” McDonough testified. “In the current process, the provisions agreed to by the union are for their benefit and their benefit alone.”

McDonough advised the panel that GCAP members are well-respected contractors who engage in public and private construction throughout the Commonwealth. As a result GCAP members recognize that the most effective ways to increase efficiency and ensure quality are the same regardless of who the owner of a project is. And, there is no good policy reason why public construction should not mimic the best practices of private construction.

“GCAP believes that neither a public owner nor its representative should mandate the use of a PLA that would compel any firm, union or nonunion, to change its labor policy or practice in order to compete for or to perform work on a publicly financed project,” said McDonough.

Incorporated in October 1953, GCAP represents the member interests of the Master Builders Association of Western PA (MBA), the Keystone Contractors Association (KCA) and the General Building Contractors Association (GBCA). As such, they are the statewide voice for more than 500 union-affiliated general and specialty contractors and their affiliates throughout the Commonwealth.

For more information, contact:

Terry McDonough (717-731-6272)

GCAP continues to work with the Pennsylvania Institute of Certified Public Accountants, the PA Chamber, Associated Pennsylvania Constructors and others to ensure passage of this important legislation. If you or your company are located in a municipality that levies the BPT, please contact Terry McDonough at 717-731-6272 or email hidden; JavaScript is required.

The House Labor Relations Committee has announced that they intend to report Representative John Galloway’s (D-Bucks) two bills intended to prevent employers in the construction industry from intentionally hiring illegal aliens. HB 1502 requires contractors and subcontractors engaged in public works projects to “verify” that all of their employees – to the best of their knowledge using E-verify and the Social Security Number Verification Service – are legal. HB 1503 requires construction industry employers to maintain a record of verification for their employees.

GCAP continues to work with the prime sponsor of the bills to ensure there is an iron clad “good faith immunity” provision for general contractors who verify employees based on faulty or false information (through no fault of their own). In addition, GCAP believes that while the intent of the two bills is appropriate, the legislation should not become a means to engage in “witch hunts” against general contractors by anyone with an ax to grind against a general contractor. Therefore, GCAP has submitted amendatory language to Rep. Galloway, and we will keep working with him and legislative staff on these issues. In the meantime, any questions, please contact Terry McDonough at 717-731-6272 or email hidden; JavaScript is required.

Senate Labor and Industry Committee staff have released to GCAP and other interested parties an omnibus amendment to HB 400 PN 1707. The amendment makes wholesale changes to the legislation and incorporates GCAP’s efforts to ensure that a general contractor is not responsible for the hiring practices of other employers on a job site. The amendment also improves the process by which the major penalties (debarment, stop work orders, etc.) may be imposed by placing almost all of the key decision making on these matters with Courts. GCAP worked closely with Committee Staff and is pleased with the amendment as an important next step in moving HB 400 forward. While the legislative calendar for the bill remains unclear, GCAP will continue to push for final passage on this legislation. For more information about this amendment, please call contact Terry McDonough at 717-731-6272 or email hidden; JavaScript is required.

As GCAP member contractors wait for the go-ahead to begin work for which they successfully bid, construction on six state prison expansion projects is at a stand still. At issue is how to implement the design build process supported by the Department of General Services and GCAP in light of Pennsylvania’s nonsensical Separations Act that requires the Commonwealth to hold four separate contracts for any public works construction project. This problem was largely brought to the surface as a result of litigation regarding a separate problem with public construction, project labor agreements (PLAs).

GCAP continues to have conversations with the Department and legislative leaders interested in finding a resolution to this matter. For more information about this matter, please call contact Terry McDonough at 717-731-6272 or email hidden; JavaScript is required.

Click here to view.

Continuing its overall effort to ensure that Pennsylvania’s Mechanics’ Lien law is made better for all aspects of the Commonwealth’s construction industry, the General Contractors Association (GCAP) agreed to Sen. Pat Browne’s (R-Lehigh) priority legislation to create specific relief for those involved in the construction of residential properties.

While the bill was originally introduced with the exact same provisions of SB 726 (which GCAP shepherded to a 50-0 vote in the Senate last session), it was amended to provide more tailored relief for residential construction.

As signed into law on August 11, Act 34 of 2009 eliminates the monetary waiver exemption for residential projects (when the contract price was less than $1,000,000) and changes it to three-story height limitation. That means a contractor may continue to waive his right to file a claim against property for residential projects of any price so long as they are three stories (not including the basement) in height or less.

Recognizing how important this issue was back home for Sen. Browne who is a member of Senate Republican Leadership, Chairman of the Senate Finance Committee, Vice Chairman of the Senate Education Committee and a member of the Senate Appropriations Committee, GCAP agreed to allow SB 563 to move through the legislative process with the amendment mentioned above. As such, GCAP is pleased that Act 34 of 2009 provides immediate relief for all those engaged in residential home building projects.

On the broader matter of Mechanics Lien reform, GCAP remains an important resource for the General Assembly. We continue to work with legislators and their staff to educate them about how the different provisions of the statute impact the construction industry. Whether it be issues related to protection for payment for work already completed or the process by which liens are filed, making sure that the Mechanics Lien law does not unfairly or unnecessarily impede the of progress of Pennsylvania’s construction industry is a top priority for GCAP. We expect that additional legislation proposing changes to the Mechanics Lien law will be introduced during this legislative session, and we will work with the prime sponsors of these bills to ensure that they benefit Pennsylvania construction.

For more information regarding SB 563 or the Mechanics’ Lien Law, please contact…

Regardless of the media outlet, all eyes are on the Governor and legislative leaders as they work to resolve the FY 2009-10 budget impasse. As the budget process takes its next turn – the formation of a conference committee to reach a compromise – increasing the personal income tax and freezing the phase-out of the Capital Stock and Franchise Tax (maintaining the 1.89 mills rate) remain squarely in the middle of the table.

Fortunately, the monies used for capital construction projects are separate from the General Fund (the focus of the current budget struggle) so the Commonwealth is continuing to build, including several state prison projects. For more state construction and procurement news, contact GCAP at 717-512-6391 or email hidden; JavaScript is required.

A bill that may move in the State House contains a provision that would require school districts under the Department of Education’s Mandate Waiver Program to solicit both single and separate prime bids before they take relief from the state’s Separations Act. This language is included in Section 21 of House Bill 11(Roebuck, D-Philadelphia) which is referred to as an omnibus school code bill – meaning it addresses multiple education issues in one piece of legislation. House Bill 11 is currently in the House Education Committee awaiting further action. Similar language is contained in amendments to other education-related bills not yet scheduled for consideration.

On July 21, GCAP advised the Majority and Minority Chairs of the House Education Committee along with committee members that GCAP opposes Section 21 because it will result in a disingenuous comparison of school construction delivery methods, and it runs counter to the intent of the Education Empowerment Act which allows a waiver of the separate prime requirement in the first place.

GCAP continues to work with its partners, the Pennsylvania School Boards Association, the Pennsylvania Association of School Business Officals, the American Council of Engineering Companies of Pennsylvania and AIA Pennsylvania to lobby against requiring school districts to bid both projects both ways because doing so does not result in an “apples to apples” comparison of construction bids. For more information on how you can help with this issue, please contact GCAP at 717-512-6391 or email hidden; JavaScript is required.

The exact future of House Bill 11 or any school code legislation remains in question because the Senate has indicated that they will not move on any such legislation in the near future.

By a vote of 197-1 in early July, the State House of Representatives sent House Bill 1770 (Gergely, D-Allegheny) to the State Senate for its approval. The measure would provide an additional seven weeks of unemployment compensation and would be funded with federal stimulus dollars.

One reason the bill has not yet moved in the Senate is because they believe a full discussion on how to make the state’s Unemployment Compensation Trust Fund solvent should be tied to any extension of these benefits. An effort to fix the insolvency problem could result in Pennsylvania’s business community having to pay more in UC costs. However, the Senate is also demanding that labor/employees also share this burden. GCAP will continue to lobby this issue, and we will keep you posted via the website. In the meantime, for more information about House Bill 1770 0r UCTF insolvency, please contact GCAP at 717-512-6391 or email hidden; JavaScript is required.