Sheet metal & Air Conditioning Contractors’ National Association

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Many important SMACNA issues await 2017

Jan 13, 2017

Pension reform

While the odds appeared favorable for including the Composite Plan Design proposal as part of the Continuing Resolution (CR) process after the election, the U.S. Congress did not act before adjourning in 2016.

This occurred despite that language was ready to go and had significant congressional member and staff support. In addition, Congress did not increase PBGC (Pension Benefit Guarantee Corporation) premiums for multiemployer pension plans to help fund Pension Benefit Guaranty Corporation deficits.

The Continuing Resolution was considered the best bet to get Composite Plans authorized but, at the end, a few obstacles derailed that strategy. The Leadership wanted a “clean” CR to make final passage easier and Senate Democrats wanted to use Composite Plan Design as leverage to get the Mine Workers Pension problem fixed. In the end, the House leadership would not agree to addressing either policy issue.

Looking ahead to 2017, SMACNA and our construction employers’ coalition will work closely with the House Ways and Means Committee to generate more enthusiasm, urgency, and a more pro-active posture for Composite Plan Design.

Major tax reforms

Leaders in the House and Senate have outlined an ambitious tax reform agenda for the first nine months of the 115th Congress and it appears to require two separate reform packages.  House Ways and Means Committee Chair Kevin Brady (R-Texas) indicated he expects to handle a modest collection of reforms and expiring tax provisions in January and February, as well as repeal of the Affordable Care Act tax provisions.

It is hoped that the energy and related tax incentives will be part of this package, including 179D, waste-heat-to-power, thermal energy, and combined heat and power tax incentives that expired on Jan. 1.

SMACNA and its coalition partners worked all last year to extend these provisions with the assurances of early action in 2017 by Senate Finance Committee leader Orin Hatch (R-Utah), most tax committee members, and Senate Leader Mitch McConnell (R-Ky.). When Congress decided to quit early in December they left these provisions and a tall stack of bills on their desks with the votes to pass had votes then been taken.

Energy efficiency incentives

Comprehensive energy policy legislation, the product of years of negotiation and bipartisan support was awaiting floor action when Congress adjourned in December. While the package had been significantly modified after the election to reach a bipartisan compromise version supported by House and Senate energy policy leaders, at the last moment the House leadership postponed promised floor action until the 115th Congress.

SMACNA has been one of the strongest supporters of the House’s version which focused more on energy efficiency in the commercial, industrial, and residential sectors as well as upgrades to energy related infrastructure. SMACNA’s Capitol Hill office has begun working with members returning for the 115th Congress on a similar bill that retains the energy efficiency goals and program incentives designed to promote an active contractor role to achieve improved energy efficiency across all market segments.

In other action: health-care policy, defense procurement reform

Congress passed two other initiatives for signature by the President.

  • Health-Care Policy: Congress passed a provision that allows small businesses with fewer than 50 employees to offer Health Reimbursement Arrangements (HRAs) to employees without penalties. These HRAs can be used by employees for the payment of premiums or qualified medical expenses associated with insurance coverage.
  • Defense Procurement Reform: Passed the $618.7 billion National Defense Authorization Act (NDAA), with many new military construction-related programs and Department of Defense (DoD) construction procurement provisions. The NDAA included a number of SMACNA-supported DoD reforms designed to boost DoD energy efficiency programs. These long-sought reforms will be important to construction contractors active in bidding combined heat and power/waste heat to power (CHP/WHP) projects, base retrofits, and performance contracts. In addition, the NDAA made a significant change to DoD’s Small Business reporting requirements and authorized a SMACNA-supported past performance pilot program for subcontractors working on DoD projects.

Help the industry and take action today

Let your members of Congress know you support these issues. Contact them through SMACNA’s Advocacy webpage and set up a meeting with them today.