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AED Washington Insights Newsletter

AED Washington Insights

February 2014

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Prepared by Christian A. Klein, AED Vice President of Government Affairs
and the AED Washington team

In this Issue:


Will You Be at the Table or on the Menu? Make Your Voice Heard at AED Washington Fly-In

The 2014 Washington Fly-In, the equipment industry's premier public policy event, is the best opportunity for construction equipment industry executives to impact the legislative process and to tell their lawmakers about the issues impacting their businesses and customers.

The annual conference provides a chance for equipment distributors, manufacturers, and industry service providers to come to Capitol Hill and hear directly from lawmakers and industry allies as well as participate personally in the lobbying process.

On Day 1, attendees will hear from a host of policy experts from Capitol Hill and the lobbying community about infrastructure, tax, energy, regulatory and agricultural policy. Invited speakers include House Transportation & Infrastructure Committee Chairman Bill Shuster (R-Pa.), House Chief Deputy GOP Whip Peter Roskam (R-Ill.), House Small Business Committee Chairman Sam Graves (R-Mo.), House Commerce Committee Chairman Fred Upton (R-Mich.), and House Agriculture Committee Member Chris Gibson (R-N.Y.).

Day 2 opens with an AED PAC breakfast featuring Reps. Cory Gardner (R-Colo.), Richard Hanna (R-N.Y.), David Joyce (R-Ohio), Pat Meehan (R-Pa.), and Reid Ribble (R-Wis.). Fly-In attendees will then spend the day meeting with lawmakers and their staff to urge action on the equipment industry's legislative agenda. In between meetings, attendees will be able to return to AED's "War Room" to share intelligence, ask questions, resupply materials, and enjoy a buffet lunch. The Fly-In concludes with a congressional reception in one of the House office buildings.

Equipment distributors are facing unprecedented political risk on a host of policy issues. There's an old saying in Washington: "If you're not at the table, you're on the menu." As our nation's leaders consider how to save the federal highway program, reform the tax code, and keep the energy sector humming, we must ensure our industry has a seat at the table. Register today for the AED Fly-In to make sure your voice is heard!



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Is Your State Doing All It Can? New AED Report Offers Menu of Transportation Financing, Funding Options

Policymakers working to fix America's crumbling transportation network have an important new tool. A study by researchers at the College of William & Mary's Thomas Jefferson Program in Public Policy (TJPPP) released on Jan. 31 examines the array of funding and financing mechanisms states are using to pay for roads and bridges. Sponsored by AED, the report includes a chart to allow quick comparison between state programs.

The study comes as the federal highway program faces unprecedented challenges. The Congressional Budget Office reported in July 2013 that due to inadequate Highway Trust Fund (HTF) resources, Congress would need to reduce the authority to obligate funds in FY 2015 to zero for both highways and transit.

The long-term outlook for the federal program is equally dim. An AED-sponsored report by TJPPP researchers released in 2013 projected that over the next two decades, HTF revenues will fall $365 billion short of the amount necessary to maintain annual federal highway spending at current levels, adjusted for inflation (approximately $40 billion per year).

One of the goals of the new study is to help lawmakers in Washington, D.C., better understand options to restore the HTF's long-term solvency. But whatever the outcome of the highway debate on Capitol Hill, given staggering road, bridge, and transit needs and the mounting costs of congestion, in the years ahead states will have to invest more in infrastructure themselves.

"There's a crisis, but there are also solutions," said AED Vice President of Government Affairs Christian Klein. "We hope transportation supporters around the country will pick up the ball and use this new information to help their federal, state, and local officials see there are many fiscally responsible paths forward for road, bridge, and transit investment."

The full report is available at http://bit.ly/aedwm2014.



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CBO Report Highlights HTF Shortfall, Need to Find Alternative Revenue Streams

On Feb. 4, the Congressional Budget Office (CBO) updated its biannual projections of the Highway Trust Fund (HTF) cash flow, estimating that the HTF will run out of money before the Sept. 30 expiration of the 2012 highway funding bill (MAP-21).

CBO also said that HTF revenues (gas tax, diesel tax, etc.) will fall more than $100 billion short of the amount needed just to keep annual highway investment at current levels (roughly $40 billion) over the next six years. This chart shows the expected balance of the federal highway program through 2024.

The CBO analysis confirms the findings of an AED study on the HTF released a year ago. The 2013 study commissioned by the association and conducted by researchers at William and Mary's Thomas Jefferson Program in Public Policy found that the HTF deficit will amount to $365.5 billion by 2035. The AED report also proposed bold solutions: Increasing the gas tax to 25 cents per gallon and indexing it for future inflation would raise $167 billion more than current baseline spending requirements over the next two decades.

"The CBO report is no surprise," said AED Vice President of Government Affairs Christian Klein. "This is just another in a series of countless wake-up calls about the highway funding crisis. Unfortunately, lawmakers are continuing to hit the snooze button. That simply can't continue. There's too much at stake for the economy, construction industry, and equipment distributors."

As the newest CBO numbers indicate, it is vital that our nation's leaders act now to maintain the HTF's solvency. Visit AEDaction.org to tell your lawmakers to find alternative revenue streams for the federal highway program today.

T&I Chairman Shuster Takes Gas Tax Off the Table
On Feb. 4, House Transportation & Infrastructure Committee Chairman Bill Shuster (R-Pa.) stated he would not pursue a federal gas tax hike and would instead favor a vehicle-miles-traveled (VMT) fee to support the federal highway program in the upcoming highway reauthorization debate.

A VMT fee has been studied at the state level, and most experts agree that the best long-term solution for the HTF is to tie revenues to road usage, not fuel consumption. But it is unclear how such a federal program would be structured given privacy concerns. Experts also point out that it would take considerable time to implement a VMT system and that money wouldn't start flowing in quickly enough to address the HTF's immediate needs.

AED commends Chairman Shuster for thinking about how best to ensure the HTF's long-term solvency. But we also believe all options must remain on the table to ensure our nation's transportation networks have the resources they need to create jobs, grow the economy, and ensure America's competiveness for generations to come.



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State Dept. Releases Final Keystone Environmental Analysis

On Jan. 31, the State Department unveiled its final environmental impact statement (EIS) on the proposed Keystone XL pipeline confirming State's previous findings in a draft version issued in March 2013 that the pipeline will have minimal environmental impact.

The EIS was issued in response to TransCanada's May 2012 application for the section of the Keystone XL pipeline that would run from Canada to Nebraska. The document reviews potential environmental impacts associated with the proposed project, including construction and potential spills, as well as the project's effect on climate change and the economy.

The State Department will now conduct a 90-day "national interest determination" to run concurrent with a 30-day public comment period. Secretary of State John Kerry, in close consultation with the White House, will then make the ultimate judgment to approve or reject the pipeline, although there is no deadline for his decision.

"Once again, the State Department has confirmed what we've known for years โ€“ the Keystone XL pipeline will have minimal environmental impact while creating significant economic activity and jobs," said AED President and CEO Brian McGuire. "The time is long overdue for approval of the pipeline. It is too important โ€“ for American workers and consumers, our economic and energy security, and the relationship with our closest ally and trading partner, Canada โ€“ to put off any longer," he added.

AED encourages its members to submit comments and to remind lawmakers that the Keystone pipeline would create thousands of American jobs and strengthen national security by decreasing our dependence on far-away oil. Visit AEDaction.org today to help make Keystone XL a reality.



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Senate Hearing Examines Surface Transportation Reauthorization

On Feb. 12, the Senate Environment & Public Works (EPW) Committee held a hearing, "MAP-21 Reauthorization: The Economic Importance of Maintaining Federal Investments in our Transportation Infrastructure," to set the stage for replacing the current surface transportation authorization legislation (MAP-21), which will expire on Sept. 30.

Tom Donohue, president and CEO of the U.S. Chamber of Commerce, kicked off testimony by emphasizing the importance of investing in our nation's infrastructure to create jobs and grow the economy. His sentiments were echoed by Jay Timmons, president and CEO of the National Association of Manufacturers; Richard Trumka, president of the AFL-CIO; and Michael Hancock, president of the American Association of State Highway and Transportation Officials (AASHTO).

T. Peter Ruane, president and CEO of the American Road and Transportation Builders Association, highlighted the looming deadline set by the Congressional Budget Office (CBO), which projected $100 billion in new revenues will be needed over a six-year period just to maintain the Highway Trust Fund's (HTF) current investment levels.

While EPW Committee members voiced strong support for federal infrastructure investment, most were unsure of how to fund the rebuilding of our nation's roads and bridges. Donohue and other witnesses urged lawmakers to take a close look at a "modest" gas tax increase in the near-term as Congress explores long-term funding options such as vehicle-miles travelled fees.

"We commend Chairman Boxer and Ranking Member Vitter for continuing to sound the alarm on the crisis facing the federal highway program," said AED President and CEO Brian P. McGuire. "Congress and the president must wake up to the fact that, without action, the Highway Trust Fund will collapse in fiscal year 2015, putting at risk an already fragile economic recovery. We look forward to working with all concerned in the upcoming highway reauthorization debate to put the HTF back on solid fiscal footing and restore certainty to federal highway and transit investment."

AED also submitted a statement to the official record highlighting the impact of the HTF's insolvency on the equipment industry. Without action, the HTF will run out of money by fiscal year 2015, risking $51 billion in spending, $2.4 billion in highway-related equipment market activity, and 4,000 equipment distribution jobs.

It is more important than ever to invest in our nation's crumbling infrastructure. Visit AEDaction.org to urge your lawmakers to find alternative revenue streams for the Highway Trust Fund.



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OSHA Extends Deadline for Crane Operator Certification

On Feb. 10, the Occupational Safety and Health Administration (OSHA) published a proposed rule that would extend the compliance date for construction crane operator certification.

The proposal would also change the existing requirements for employers to ensure their construction crane operators are qualified to operate the equipment from Nov. 10, 2014 until Nov. 10, 2017.

AED and other industry groups are concerned about implementation of the certification provision (29 CFR ยง1926.1427) in the 2010 update to the regulations governing the use of cranes and derricks in construction, originally set to take effect this year.

As operators seek to comply with the rule, differing interpretations between OSHA and industry have led to confusion about its requirements. The construction industry has therefore asked that OSHA write an interpretation on the practical terms of the provision, which requires certification tests provide different levels of certification based on equipment type and capacity.

Operators are concerned that the rule would mandate multiple certifications for each crane type and capacity permutation operated by the employee, burdening operators with inordinate certification costs. Operators of some of the rarest cranes also cited concern over the implausibility of making their equipment available for certification.

AED encourages its members to submit comments to the agency by the March 12 deadline and to let us know what you had to say at aeddc@aednet.org.



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NLRB Reissues Ambush Election Proposal

Just when you had forgotten about the National Labor Relations Board (NLRB), the pro-union entity reissued one of its most controversial proposals from the last few years - the ambush election rule.

Specifically, the NLRB proposes to decrease the amount of time required before employees can vote on unionizing their workplace. If finalized, the new rule will permit organizing elections to take place 10 days after a union representation petition has been accepted by the NLRB, making it more difficult for employers to make the case against unionization.

Originally issued in December 2011, the regulation was successfully challenged on procedural and constitutional grounds by business groups. Rather than continuing to appeal court decisions, the Board withdrew its ambush election rule earlier this year and reissued a notice of proposed rulemaking (NPRM) nearly identical to the prior proposal. The NPRM also enables union organizers to have access to the names, addresses, telephone numbers, and company e-mail addresses of employees.

Comments to the rule must be made before April 7. Stay tuned to AED for further developments. The association continues working with other industry groups through the Coalition for a Democratic Workplace to protect the rights of both employers and employees during the unionization process.



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AED Joins New Coalition to Advance Mining Interests

In January, AED and 10 other industry associations came together to form the Minerals Science and Information Coalition (MSIC) to advocate for reinvigorated minerals science and information functions in the federal government.

MSIC is composed of trade associations, professional societies, and groups representing the extractive industries; geoscience, physical, chemical, and material science professionals; processors, manufacturers, and other mineral and material supply-chain users; state government; and other consumers of federal minerals science and information. The group seeks to increase funding and support for federal minerals research, information gathering, analysis, and forecasting to sustain economic prosperity and ensure national security.

Greater investment in our nation's mineral resources is critical. Over the past decade, funding for the U.S. Geological Survey's Mineral Resources Program has been slashed by nearly a third, slowing economic development and innovation in a number of industries. To ensure a continued supply of rare earth metals and other materials vital to our economy, leaders in Washington must make investing in the extractive minerals industry a priority.

As a founding member of the coalition, AED looks forward to raising the profile of mining and related industries with key policymakers to ensure sustained investment in our nation's mineral resources.



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PAB Legislation Expected in Coming Weeks

Water infrastructure advocates are eagerly awaiting the bipartisan, bicameral introduction of the Sustainable Water Infrastructure Investment Act in the coming weeks.

The legislation will eliminate the state volume cap on private activity bonds (PABs) for water and wastewater infrastructure projects. According to estimates, removing the cap on PABs could generate as much as $5 billion annually in incremental private capital for water infrastructure projects with a hit to U.S. Treasury of only $214 million over 10 years.

AED has been leading the charge to secure introduction and support as a steering committee member of the Sustainable Water Infrastructure Coalition (SWIC). The proposal has been the association's top legislative priority for several years.

Stay tuned to Washington Insights and AEDNews for updated information on the Sustainable Water Infrastructure Investment Act's progress and how you can help get this important legislation over the finish line this Congress.



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