ASA’s Michael Oscar Named Chair of Small Business Legislative Council
Michael Oscar, Government Regulations Director at the American Subcontractors Association (ASA), has been elected as Chair of the Small Business Legislative Council (SBLC).
The SBLC is an independent, permanent coalition of trade and professional associations who share a common concern for the future of small business. The council aims to increase the influence of the small business community on legislative and federal policy, while also disseminating information on the impact of public policy on small business.
As chair—a volunteer position—Oscar will be the lead officer for the council, representing ASA and the interests of all member associations. Oscar has been an SBLC officer since 2020, serving previously as Chair-Elect and Treasurer. “It is an honor to have the opportunity to serve as Chair of the Small Business Legislative Council, a coalition I’ve had the privilege of working with to advance the needs of ASA contractors and other small businesses at the highest levels of government,” Oscar said. “The majority of our member contractors are small businesses, and their success is directly tied to the growth of the American economy and the revitalization of our infrastructure. Now more than ever, it is critical that our federal government meets the needs of small businesses, and I am motivated to do my part to represent them as Chair of this coalition.”
For more on the Small Business Legislative Council, visit sblc.org.
NCCER Releases White Paper on Unique Benefits, Obstacles and Advice of Women in Construction
Women also shared their recommendations on how to better recruit and retain women on project sites and, ultimately, in the industry. They provided guidance on how to tackle obstacles that the industry has worked on for years and brought up other hurdles that may be surprising for some. Overall, their suggestions were thoughtful and based on their lived experience in the field.
This white paper has been designed to inform and provide steps that can be taken by construction leaders to start making changes today that will improve project outcomes for tomorrow.
“With an expected shortage of 1.9 million craft professionals through 2025, there is tremendous opportunity for women to get involved in an industry that offers competitive wages, benefits, and career growth,” said Jennifer Wilkerson, NCCER Vice President of Innovation and Advancement. “If we want construction careers to be a viable option for all people, we have to change the culture and perception of our industry, starting with our own projects.”
The complete white paper, In Her Own Words: Improving Project Outcomes, is available for free at https://www.nccer.org/in-her-own-words.
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ASA Offers Input to the Office of Management and Budget on Buy America Act
On March 13, 2023, ASA, along with the Transportation Construction Coalition (TCC), submitted comments to the Office of Management and Budget (OMB) regarding the implementation of the Build America, Buy America Act (BABAA) provisions of the Infrastructure Investment and Jobs Act (IIJA). We fully support the twin objectives of maximizing the benefits from the IIJA’s historic investments, while growing domestic manufacturing, which is BABAA’s particular focus. To that end, members of our coalition have reviewed the draft guidance published by the OMB and we identified two areas in which we request clarification, so as not to diverge from Congress’ intentions in enacting BABAA. Those two areas are:
- OMB Should Reiterate BABAA Does Not Apply to Temporary Products
Section VI of the OMB Memorandum for Heads of Executive Departments and Agencies (M-22-11), published on April 18, 2022, states:
“The Buy America preference only applies to articles, materials, and supplies that are consumed in, incorporated into, or affixed to an infrastructure project. As such, it does not apply to tools, equipment, and supplies, such as temporary scaffolding, brought to the construction site and removed at or before the completion of the infrastructure project.”
The new OMB guidance does not yet include an equivalent provision. There is no indication in the IIJA that Congress intended to change longstanding policy and extend Buy America coverage to temporary products, equipment and other such items used in constructing projects, but not permanently incorporated in them. Therefore, we respectfully request that OMB restate this clarification in the final guidance.
- OMB Should Exclude Aggregates and Related Materials from Buy America Preferences, Consistent with Congress’ Clear Intent
In Section 70917(c)(1) of the IIJA, Congress established an important limitation to the term “construction materials” as used in BABAA. Congress explicitly exempted “cement and cementitious materials, aggregates such as stone, sand, or gravel, or aggregate binding agents or additives” from the “construction materials” covered under BABAA. This limitation makes clear no domestic content procurement preference under BABAA applies to aggregates and these related materials.
Section 70915(b)(1) of the IIJA requires OMB to “issue standards that define the term ‘all manufacturing processes’ in the case of construction materials” to which BABAA applies a domestic content procurement preference. These standards will help determine whether particular products comply with BABAA requirements. In Section 70917(c)(2), Congress reiterated the exemption for the above-listed materials in this additional context. The subsection states that OMB’s standards for “all manufacturing processes” “shall not include cement and cementitious materials, aggregates such as stone, sand, or gravel, or aggregate binding agents or additives as inputs of the construction material.”
The draft OMB guidance inquires as to whether a combination of these exempt materials could somehow form an end product subject to Buy America coverage. First, BABAA does not provide authority for the listed materials being considered manufactured products because only the combination of construction materials not included in the limitation produces a “manufactured product” under OMB’s proposed guidance.
Second, the combination of the listed items as concrete or asphalt mix are not a construction material for which BABAA establishes a domestic content procurement preference. Congress understood that the materials they were excluding from the term “construction materials” are, when combined, concrete and asphalt mix construction materials. Congress included Section 70917(c)(2) to ensure that the combination of construction materials in Section 70917(c)(1) into concrete and asphalt mix construction materials did not create a domestic content procurement preference for concrete or asphalt mixes.
Finally, no one disputes that aggregates and these related items are construction materials in the generic sense. However, as cited above, Congress enacted the language in these portions of the IIJA to explicitly exclude them from the “construction materials” for which BABAA establishes a domestic content procurement preference.
ASA Opposes Bond Threshold Increase in Illinois
On March 10, 2023, ASA sent a letter to the Illinois Senate Executive Committee opposing SB157, which seeks to amend Section 1 (30 ILCS 550/1) of the Public Construction Bond Act, Illinois’ Little Miller Act, by raising the current bond threshold from $50,000 to $5,000,000. Also, the legislation creates a “self-insured risk pool” to pay claims or damages arising under a public works construction contract valued at $5,000,000 or less because of a contractor’s failure. SB157 elevates the Illinois’ bond threshold to the highest in the Nation, which is 35 times greater than the federal threshold ($150,000) as required by the Miller Act (40 U.S.C. §§ 3131 et seq;) and applicable regulations. In addition, Illinois’ bond threshold will become an outlier to the thresholds of neighboring states, such as Indiana ($200,000), Iowa ($25,000), (Michigan ($50,000), Minnesota ($175,000), Missouri ($50,000) and Wisconsin ($148,000/local, $369,000/state projects), if this bill is enacted.
Increasing bond thresholds may allow small and emerging contractors to bid on public construction projects, but the committee must consider the inherent risks they place on the construction industry, along with state and local jurisdictions bearing the burden of rebidding work and paying excess completion costs. Additionally, this could be problematic on projects with tight budgets or schedules. A contractor’s ability to obtain bonding reflects his or her capability to perform a contract. Higher bond thresholds potentially allow more contractors who are incapable of obtaining bonding and who have not been through the surety’s comprehensive vetting process to bid on and be awarded large public contracts for which no payment and performance bond would be required. This exposes public entities to greater risk, gambles with taxpayers’ money, and burdens subcontractors with the possibility of nonpayment.
As for advancing small and emerging contractors, increasing bond thresholds does not necessarily mean that these contractors would obtain more public construction business. Instead, it could result in financially unstable contractors who could not obtain bonding and who were not prequalified by a surety, bidding on and winning public construction jobs. Those small and emerging contractors acting as subcontractors on those projects would not have the protection of a payment bond should something go wrong with the general contractor. Finally, over time, raising bond thresholds harms small and emerging contractors and suppliers by substantially increasing their risk of nonpayment if they are operating as subcontractors, and by raising the difficulty of qualifying for their first bonds.
