Category: Advocacy

MCAA Voices Support for the Stop Unfair Bid Shopping Act of 2019

In a November 26, 2019 letter to Congressman Scott Peters (D-CA-52), MCAA Government Affairs Committee Chair Jim Gaffney voiced MCAA’s support for the Stop Unfair Bid Shopping Act of 2019 (SUBS Act, HR 5247). The letter commends the Congressman for introducing the latest version of the good-government reform to the direct Federal construction contract low-bid, price-only selection procedures.

The SUBS Act would require prime contractors on awards of $1.5 million or more to list major first-tier subcontractors of $100,000 or more. Post-award substitutions of listed subcontractors that amount to deductions of 10% or more would result in a deductive change to the prime contract for amounts above the substitution threshold.

This is the latest version of the perennial sub bid listing measure that once passed the Congress and suffered a Presidential veto many decades ago. It also prevailed in agency procurement from 1963 to 1983 but was rescinded at that point based on outdated procurement practices.

Congressman Peters’ SUBS Act has been referred to the House Oversight and Government Reform Committee, which is now chaired by New York Congresswoman Carolyn Maloney (D-NY-12), who has been a sponsor of subcontractor bid listing for several Congresses.

MCAA will continue to monitor the act’s progress and will keep you updated.

READ THE LETTER

Multiemployer Pension Rescue Proposal Released

Senate Finance Committee Chairman Chuck Grassley (R-IA) and Senate Health, Education, Labor and Pensions Committee Chairman Lamar Alexander (R-TN) released their comprehensive multiemployer pension reform proposal on November 20, 2019. Summarized in a white paper and technical explanation entitled “Multiemployer Pension Recapitalization and Reform Plan” (MPRRP). The proposal is a comprehensive and complicated re-write of the multiemployer plan rules as compared with current law and reflects a yeoman’s job of Congressional staff over recent years working diligently to get this latest reform done right from their perspectives. Still, that ultimate judgment in the near term will depend on intense negotiations among the various stakeholders on a final proposal that may be okayed by Congressional leadership for enactment on the year-end spending measure in late December – if equitable compromises on both sides of the aisle can be reached on the crucial principal issues.

1) Plans eligible for PBGC partition – Significantly increased PBGC premium levies on all plans, combined perhaps with some as-yet-to-be-defined amount of government appropriations support, will be dedicated to finance and administer a robust PBGC partition program, to pay some of the benefits of “orphans” (participants whose employers no longer contribute to the plans) in qualifying critical and declining plans that meet specific criteria, along with three qualifying named exceptional plans: Teamsters Central States, Road Carrier Local 707, and the United Mineworkers National plan. As proposed, partition payments from PBGC are greater for Central States and Road Local 707 as compared with other eligible partitioned plans. The PBGC maximum payment guaranty would be increased from $12,870 per year, to approximately $20,000 annually.

2) PBGC premium increases – The PBGC premium increases proposed are comprised of the following elements:

  • Flat rate increase – The flat rate per participant annual per capita payment would increase, rising from the current $29 per person per year to $80 per person per year (the same as the single employer plan premium now).
  • New variable rate premiums – A new variable rate premium is added, amounting to 1% of a plan’s current unfunded liability divided by the number of participants, capped at $250 per person per year.
  • New stakeholder retiree, union, and participating employer monthly “co-pays” – The proposal adds new “co-payments” on unions and employers amounting to $2.50 per participant per month, and on retiree benefits levied (collected by monthly plan withholding on a sliding scale based on plan funding status), ranging from a low of 3% for retirees in critical plans, to up to 10% for retirees in partitioned plans.

3) Funding rules – mandated assumed discount rate valuation of liabilities – The proposal requires that the assumed discount rate used by actuaries to project plan liabilities be limited to the lesser of either 6% or the 24-month average third-segment of the 25-year corporate bond yield curve, plus 2%. Experts comment that in most instances the lesser rate will be 6%. This rate is to be phased in over five years, beginning in Plan Year 2020. Changes in plans’ funding status due solely to the decreased interest rate assumption may amortized over 30 years.

4) Changes to withdrawal liability rules – The construction industry basic withdrawal liability rules and exemption remain intact. However, the methods for measuring maximum annual payments for any liability incurred are changed materially. The 10-year look back for maximum annual payment calculation is extend to 20 years, and the period of payment of liability is gauged by plan funding status. Plans are required to provide withdrawal liability estimates to all contributing employers free of charge every three years.

There are a myriad of other significant changes in the MPRRP proposal, including zone status rule changes. MCAA is analyzing the changes in conjunction with our consultants at Horizon Actuarial Services and Groom Law Group, along with our stakeholder partners at the UA.

Other stakeholder coalitions, including the NCCMP and the Construction Employers of America (CEA), are engaged in similar in-depth assessments and analysis in preparation for the key negotiation period between now and Congressional recess in late December.

All recognize that successful reforms this year are key, as a general election year is usually not conducive to delicate bipartisan compromises on crucial national issues. However, it also is widely recognized that significant equitable compromises in the initial proposal are essential to avoid further destabilizing the entire multiemployer system to provide partition for only a relatively small yet very significant subset of the whole.

MCAA’s leadership is taking this very important matter under advisement and will keep you apprised of developments along the way to whatever resolution may be achieved by the end of the year.

White Paper Summary

Technical Explanation

National Service and Maintenance Agreement Negotiations to Begin Spring 2020

The National Service and Maintenance Agreement continues to be an excellent tool used by  HVACR and plumbing service contractors around the country to grow market share and remain competitive in this highly competitive market.  The current National Agreement is effective through July 31, 2020.  The MSCA Labor Committee will be discussing potential changes or modifications with the UA later this year.  Although we anticipate very few changes, we would appreciate your input or recommendations on terms and conditions which you feel may be helpful in expanding your service business.  Please send all comments to bdolim@mcaa.org  by December 6, 2019.

ARCA/MCA Continues Unanimous Board Support of MCAA PAC

For 15 years running, ARCA/MCA’s Board has unanimously contributed to MCAA’s Political Action Committee. This ongoing commitment, and commitments from several other MCA local affiliate Boards and other groups across the country, ensure that MCAA’s Government Affairs Committee has sufficient resources to advance key MCAA member interests on Capitol Hill.

Find Out What’s New with Our Labor Partners at MCAA2020

In August 2016, Mark McManus was unanimously elected as General President at the UA’s 39th General Convention and on November 10, 2016, he assumed his new position leading the nation’s most progressive and influential trade union. Mark McManus has had a distinguished career in support of our nation’s hard-working men and women and has been unwavering in his commitment to a strong and mutually beneficial partnership between labor and management. See everything we have planned for MCAA2020 on our convention website.

UA-MCAA Conference Highlights Benefits of Labor/Management Partnership

Over 1,400 United Association and MCAA representatives gathered this week for the 2019 UA-MCAA Labor Relations Conference: Succeeding Together to openly discuss key issues affecting the future of both memberships, including assignment of trade jurisdiction, utilization of apprentices, the impact of benefit packages on contractors’ competitiveness, the importance of growing the service industry and the need for greater diversity in the field and office. In his opening remarks General President McManus established the tone for the conference when he stated three prerequisites to a meaningful and lasting labor/management partnership: Open and Continuous Communication; No Surprises; and Trust.

UA-MCAA Labor Relations Conference Convenes in Las Vegas

The 2019 UA-MCAA Labor Relations Conference: Succeeding Together will convene October 29 – 30, 2019, at The Mirage in Las Vegas, Nevada. The conference, jointly hosted by the United Association (UA) and MCAA, will feature panel discussions focused on topics such as growing apprenticeships, expansion of service, and attracting tomorrow’s diverse workforce.

Succeed Together at the UA-MCAA Labor Relations Conference

From discussions on apprenticeship best practices, diversity, and service to an MCAA-sponsored session that lets apprentices understand the management side of the business, the 2019 UA-MCAA Labor Relations Conference: Succeeding Together will enhance your understanding of both UA and MCAA viewpoints. With mutual understanding, we can work toward continued work for UA members and profitable jobs for MCAA contractors, and that’s a win for everyone!

Collaborative Programming Aimed at Labor-Management Success

From discussions on apprenticeship best practices, diversity, and service to an MCAA-sponsored session that lets apprentices understand the management side of the business, the 2019 UA-MCAA Labor Relations Conference: Succeeding Together will enhance your understanding of both UA and MCAA viewpoints. With mutual understanding, we can work toward continued work for UA members and profitable jobs for MCAA contractors, and that’s a win for everyone!

New Report Analyzes Impact of Lingering Pension Reform Impasse in Congress

MCAA, the United Association of Plumbers and Pipefitters (UA), and Horizon Actuarial Services have released a new report, Multiemployer Pension Plan Reform Policy Issues (June 2019). The report analyzes how the impact of the lingering pension reform impasse in Congress adversely affects active participants in MCAA/UA pension plans and highlights inequities in benefit levels.

“Active participants face higher contributions and lower benefit levels as funding challenges mount and are left unaddressed by Congress,” the report and analysis conclude.

MCAA President Brian Helm and UA General President Mark McManus stressed in a joint letter on the report, “Congressional reforms must include judicious consideration and equitable balancing of the burden of reform on all stakeholders in the system, including current active participants, vested/inactives, retirees and their beneficiaries, and contributing employers so as to bolster the sustainability of the system going forward.”

The joint UA/MCAA letter accompanying the report calls for Congressional action this year, with McManus and Helm citing UA and MCAA full support for the Common Sense Principles for Multiemployer Reform issued by the National Coordinating Committee for Multiemployer Plans (NCCMP) and a broad coalition of employer and labor groups across the country.

The report analyzes pension and benefit levels for a sample of representative active participants in plans who began their careers in the 1970s, 1980s, 1990s, 2000s, and 2010s and “reveals that current active participants are contributing more and receiving lower benefits as compared with their predecessors.” The analysis concludes that, “Policy makers should be mindful of these inequities when considering potential changes to the funding rules and should make every effort to minimize the burden placed on the current generation of plan participants.”

MCAA is releasing the report in a meeting with the new Director of the Pension Benefit Guaranty Corporation (PBGC), Gordon Hartogensis, on June 26, 2019, at the PBGC offices.

After that, MCAA and the UA will be distributing the report to Congressional Committees with jurisdiction over pension reform in anticipation of an upcoming hearing on the issue before the House Ways and Means Committee shortly after the Fourth of July Congressional recess.

For More Information

Contact John McNerney (MCAA) at 301-869-5800 or Ben Ablin, ASA, EA (Horizon Actuarial Services), the principal author of the report and analysis, at 240-247-4542 for additional information or assistance with any questions.

The UA-MCAA Labor Relations Conference Makes the Labor-Management Relationship a Win-Win for All

Join your UA and MCAA colleagues for education geared toward making the labor-management relationship a win-win for all parties. The 2019 UA-MCAA Labor Relations Conference: Succeeding Together will take place October 29 – 30, 2019, at The Mirage in Las Vegas, Nevada. This conference provides the unique opportunity to see both sides of the coin as labor and management collaborate on sessions and panel discussions to give attendees an in-depth look at what makes our relationship so important. Registration is now open!

The conference, jointly hosted by the United Association (UA) and MCAA, will feature panel discussions focused on topics such as growing apprenticeships, developing a joint labor-management strategic planning committee and retention of workers.

Acknowledging the importance of engaging the future of our organizations, the UA is asking all locals to bring one apprentice to the conference this year. MCAA will be hosting a breakout session with these apprentices to give them an opportunity to really dig into and ask questions about the management of the business with MCAA leaders one-on-one. Because apprentices are not only the future of the UA, they are the future of the MCAA as well.

To maximize our time together, MCAA is asking its members to plan joint dinners with their local labor partners following Tuesday’s reception. Exchanging ideas and experiences is how we will continue to thrive in this industry we all love, it is how we will be Succeeding Together.

Register Today for the UA-MCAA Labor Relations Conference

The 2019 UA-MCAA Labor Relations Conference: Succeeding Together is scheduled to take place October 29 – 30, 2019, at The Mirage in Las Vegas, Nevada and registration is now open!

The conference, jointly hosted by the United Association (UA) and MCAA, will feature panel discussions focused on topics such as growing apprenticeships, developing a joint labor-management strategic planning committee and retention of workers.

Acknowledging the importance of engaging the future of our organizations, the UA is asking all locals to bring one apprentice to the conference this year. MCAA will be hosting a breakout session with these apprentices to give them an opportunity to really dig into and ask questions about the management of the business with MCAA leaders one-on-one. Because apprentices are not only the future of the UA, they are the future of the MCAA as well.

To maximize our time together, MCAA is asking its members to plan joint dinners with their local labor partners following Tuesday’s reception. Exchanging ideas and experiences is how we will continue to thrive in this industry we all love, it is how we will be Succeeding Together.

MCAA PAC Appreciates Your Support

Members of the MCA of Connecticut’s Board recently continued the long-standing tradition of Board support for the MCAA PAC. They join a long list of supporters who have provided funds to ensure that the MCAA PAC can continue its efforts to gain our members and our industry a fair hearing in federal public policy decisions.

Those supporting the MCAA PAC from January 1, 2018 – November 30, 2018 were:

  • Kristin Abrahamson
  • Anthony J. Ahern
  • John E. Ahern
  • John E. (Tripp) Ahern
  • Keith Atteberry
  • John Baker
  • Robert M. Berkmoes
  • Robert Bolton
  • John W. Brainerd, Jr.
  • James W. Bruner
  • Katherine & Todd Bruno
  • Pete Buongiorno
  • David G. Cannistraro
  • Joseph & Susan Cannistraro
  • Robert & Robin Carder
  • Don Chase
  • Jay Chase
  • Daniel Cheresko
  • Matt & Lori Clarke
  • Lonnie Coleman
  • Richard Cook
  • Steve Cornelius
  • Dennis G. Corrigan
  • Matt Cunningham
  • Steve Dawson
  • James Deflavio
  • Carl & Jackie Evans
  • Carl M. Evans
  • Mason & Mary Evans
  • John Feikema
  • Mark Felio
  • Robert Felix
  • Charles Fell
  • John & Valerie Ferrucci
  • Robert & Deborah Fisher
  • Christopher P. Fitch
  • James & Sara Ford
  • Steve Fosdick
  • Christopher J. Freeman
  • James P. Gaffney
  • Michael & Christine Gallagher
  • Don Giarratano
  • Jason Gordon
  • John Green
  • Jeffrey & Margery Grodsky
  • Carl Grolle
  • George Hamori
  • George Mulvaney Revocable Trust
  • Curtis Harbour
  • Kenneth Harbour
  • Brian Helm
  • Duane & Linda Hendricks
  • Jace & Rachel Hierlmeier
  • James & Lisa Hill
  • Todd Joseph Hoyt
  • Brian Hughes
  • James R. Jarvis
  • Scott E. Johnson
  • Armand H. Kilijian
  • Robert A. Lake, CPA
  • Scott & Rhonda Limbacher
  • Jay Lusita
  • William Lynch
  • Sheri L. McGinty-Flesher
  • John & Bridget McKenney
  • Beni Menaco
  • The Miles Family Revocable Trust
  • Barry Moore
  • Jose Moreno
  • Patrick & Laura Murphy
  • Clifton D. O’Donal
  • Randall Pagel, Sr.
  • Michael Reed
  • Glenn Rex
  • James R. Reynolds
  • Mark Rogers
  • Chris Saldecke
  • Richard J. Sawhill
  • Timothy & Jennifer Schneider
  • Robert Snyder, Jr.
  • Bryan Suttles
  • Krista & Raphael Tahlman
  • Kathleen & Timothy Taylor
  • Michael & Brenda Tobin
  • Lawrence Verne
  • Frank Wall
  • Thomas Wanner
  • Graham Williams
  • Paul & Jillian Wing
  • Adam & Paula Wunderlin

MCAA PAC appreciates your support.

Learn More and Contribute

ARCA/MCA Continues Unanimous Board Support of MCAA PAC

ARCA/MCA Executive Vice President Dick Sawhill and the ARCA/MCA Board made substantial contributions to the MCAA Political Action Committee again this year. This ongoing commitment, along with commitments from several other MCA local affiliate Boards and other groups across the country, ensure that MCAA’s Government Affairs Committee has sufficient resources to deploy on a non-partisan basis to advance key MCAA member interests on Capitol Hill.

MCAA and the UA Form Alliance

MCAA and the UA have partnered with the Society of American Military Engineers (SAME) in a new alliance focused on building our national security by contributing to America’s infrastructure development. The groups will collaborate on workforce development, educating influencers and decision makers, and education and training.

MCAA Releases In-Depth Risk Analysis of Alternative Retirement Plan Designs WebBook

In response to a request from the MCAA Board of Directors following discussion of the stalled legislative proposal allowing new Composite Plan options, Horizon Actuarial Services provided an in-depth analysis of Alternative Retirement Plan Designs. The report, authored by actuaries Cary Franklin and Jonathan Feldman, offers a general risk-factor analysis for plan trustees to consider in any more in-depth analysis of particular plan circumstances and plan design options. It focuses on six areas: 1) traditional defined benefit (DB) plans; 2) variable DB plans; 3) cash balance plans; 4) money purchase plans; 5) profit sharing plans; and, 6) proposed new composite plans (not yet enacted into law). Cary Franklin will be making a presentation on this analysis at the National Issues Conference.

Joint MCAA/UA Brief Supports NLRB Determination on Worker Misclassification

MCAA and the United Association (UA) filed a joint brief in the Velox Express, Inc. case (Case No. 15-CA-184006) pending before the National Labor Relations Board (NLRB). The organizations voiced support for an NLRB Administrative Law Judge’s (ALJ) opinion that worker misclassification itself is an independent violation of workers’ rights under the National Labor Relations Act. The act includes provisions barring employer interference, restraints or coercion with respect to a worker’s right to engage in protected concerted activity.

In the case at issue, Velox Express classified couriers who pick up and deliver medical diagnostic test samples from physician sites and testing labs as independent contractors rather than as employees.

The ALJ noted that the NLRA contains an exception allowing for exclusion of legitimate independent contractors from protected “employee” status. The ALJ also stressed that the Supreme Court has directed that such exceptions are not to be expansively interpreted so as not to deprive legitimate employees of their rights under the NLRA.

Applying the NLRB’s multifactor analysis to the facts of the courier’s work with the company, the ALJ held that the balance of the factors swayed the judgment toward finding misclassification of the worker as an independent contractor rather than as an employee.

The ALJ went on to determine that, “By misclassifying its drivers, Velox restrained and interfered with their ability to engage in protected activity by effectively telling them that they are not protected by Section 7 and thus could be disciplined or discharged for trying to form, join or assist a union or act together with other employees for their benefit and protection.”

Expressing full support for the ALJ’s holding, the MCAA/UA brief, prepared by the O’Donohue law firm, concluded that “. . . a determination by the Board that improper misclassification of employees as independent contractors constitutes a stand-alone Section 8(a)(1) violation does not in any way restrict or interfere with an employer’s legitimate use of entities that are actual, bona fide [independent] contractors.”

Amicus briefs supporting the employer’s appeal of the ALJ decision argue that misclassification alone cannot be the basis for an independent violation of protected rights. They state that in all cases, the misclassification charge must be joined with some other related unfair labor practice charge.

MCAA will monitor developments on the matter and report on the final NLRB determination.

Report Points to Resilience in Multiemployer Defined Benefit Pension System

The construction industry’s multiemployer defined benefit pension system is showing signs of resilience, according to the recently revised Inventory of Construction Industry Pension Plans, MCAA and Horizon Actuarial Services’ groundbreaking analysis of historical trends in pension plans’ key operating data. Roughly 75% of all construction industry multiemployer plans are projected to be fully funded within 15 years according to the inventory, which is based on the annual reports (Form 5500) filed with the Labor and Treasury Departments for Plan Years 2006 through 2015.

Horizon Actuarial’s Cary Franklin, principal author of the report, notes that “plan resilience is the hallmark of the jointly sponsored construction industry plans,” which represent some 55% of all multiemployer plans nationally. Franklin also noted that the new data shows improved median plan funding status, reaching 82% in 2015, and modest growth in active participants in construction plans in years after 2011, all “modestly positive trends.”

“The 10-year data trends reflect the sound work plan trustees and bargaining parties continue to do to make sure the plan participants have good, hard-earned lifetime benefits they can rely on,” Franklin said, concluding that “labor and management plan trustees would benefit further if Congress would enact new options for plans to consider to help keep the system sustainable on a long-term basis.”

MCAA President Mike Brandt noted that, “Cary Franklin and his associates at Horizon have done a remarkable job – again – in producing this one-of-a-kind MCAA industry service and analysis, which is designed to help labor and management trustees benchmark their plan performance, help MCAA employers meet their year-end accounting disclosure requirements, and just as importantly – to guide national policy makers in enacting sound public policy decisions to allow plan trustees new options to improve the sustainability of the plans for the benefit of both employees and their families and their employers.”

“While the Fifth Edition of the Inventory shows some signs of steady improvement given the market rebounds since the 2008 Great Recession,” Brandt said, he cautioned that “there still is much underlying data in the Inventory underscoring the imperative need for deliberate legislative action – enacting the GROW Act H.R. 4997 – to give plan trustees more options and flexibility to keep these valuable benefits on a stronger and sustainable basis going into the indefinite future.”

Local Affiliate Boards Continue to Support the MCAA PAC

All members of the MCA of Detroit’s Board of Directors recently contributed to the MCAA PAC, continuing a long-held tradition of unanimous Board support. The boards of the MCA of Connecticut, M&SCA of Eastern Pennsylvania, MCA of Houston, ARCA/MCA, CPMCA, New England MCA and MCA of South Florida also contributed to the MCAA PAC recently, as have the members of many Peer Groups. This support enables the MCAA PAC to gain MCAA members and our industry a fair hearing in federal public policy decisions.

Get the “Nitti-Gritty” on Tax Reform at MCAA18

Tony NittiLooking for the light at the end of the tax reform tunnel? Anthony Nitti will give you the “Nitti-Gritty” on the new tax reform act. His insights and analyses will show you how the changes in the tax law affect your company and your customers.

Some of the topics to be covered include:

  • The impact of the new tax law on your type of entity (C-Corp, S-Corp, partnership, or sole proprietor)
  • Changes to the rules for cash vs. accrual accounting
  • Bonus depreciation vs. Section 179 expensing of business assets
  • Changes in the deductibility of entertainment costs

Anthony “Tony” Nitti, CPA, is a Tax Partner in the Aspen, CO office of WithumSmith+Brown’s National Tax Service Group. His practice primarily focuses on corporate and partnership tax planning. He’s well known in the industry as a writer for both the firm’s blog and for Forbes.

This session will be hosted and moderated by MCAA Management Methods Committee Chairman Robert Lindbloom of Apollo Mechanical Contractors. He will also unveil the next generation of MCAA’s Management Methods Manual.

Learn More About Tax Reform’s Impact on the Construction Industry

Check Out Tony Nitti’s Blog