MCAA Government Affairs Update for the Week of January 19, 2026: The Latest Developments Impacting Our Industry

As part of its ongoing commitment to protecting your livelihood and setting the stage for a bright future, MCAA has secured the services of Longbow Public Policy Group to advise our MCAA Government Affairs Committee (GAC). GAC Chair, Jim Gaffney will be passing along information relative to our industry on a regular basis.

On Monday, January 19, 2026 MCAA Lobbying Firm, Longbow Public Policy Group provided the following information:

Trump Administration

• Last week, President Trump acknowledged growing backlash to the rapid expansion of data centers that the MCAA advocacy team has been reporting on for weeks. Trump announced a plan aimed at ensuring Americans do not “pick up the tab” for higher electricity bills tied to AI-driven power demand. Under the initiative, the Administration is urging PJM Interconnection—the nation’s largest power grid operator covering 13 states, including data center hubs in Virginia and Pennsylvania—to accelerate construction of new baseload power plants by offering 15-year revenue certainty, capping capacity market costs to protect residential ratepayers, and requiring data centers to fully pay the full cost of new generation built on their behalf. The announcement follows warnings from PJM that it is nearing capacity as data centers come online faster than new generation can be built, driving up rates and increasing the risk of outages during extreme weather. Against this backdrop, New York Gov. Kathy Hochul (D-NY) garnered attention last week when she unveiled the “Energize NY Development” initiative, which would require large power users that fail to deliver significant job growth or other public benefits to either generate their own electricity or pay higher grid costs. The growing debate over the impact of data centers is also forcing major tech companies to revamp their messaging. For example, Microsoft announced a new “Community-First AI Infrastructure” initiative. It commits Microsoft to: (1) preventing data center electricity costs from being shifted onto residential ratepayers; (2) prioritizing job creation and workforce development through labor partnerships, including a newly announced agreement with North America’s Building Trades Unions to expand apprenticeship pipelines; (3) reducing and replenishing water use; (4) paying full local property taxes; and (5) expanding AI education and non-profit support in host communities. These developments come as the Trump Administration announced it completed a trade deal with Taiwan praised by the tech industry because it obligates Taiwanese companies to build at least $250 billion in chip factories in the United States.

• As the MCAA continues its outreach to the Department of Labor on issues like registered apprenticeship, employee misclassification, Davis-Bacon prevailing wage and more, recent leadership turmoil is diverting attention and capacity within the department at a critical time. Last week, Labor Department Chief of Staff Jihun Han and Deputy Chief of Staff Rebecca Wright were placed on administrative leave following a report detailing a whistleblower complaint alleging that Labor Secretary Lori Chavez-DeRemer had an affair with a subordinate, drank at work, and engineered her official travel to visit family and friends at taxpayer expense. The Department’s inspector general has launched an investigation. Han and Wright are being investigated for their role in facilitating the Secretary’s personal travel with taxpayer funds. The Secretary has not directly commented on the investigation but denied any wrongdoing through her press secretary. And last night, White House Press Secretary Karoline Leavitt said that President Trump is “aware of the investigation, and he stands by the secretary, and he thinks that she’s doing a tremendous job at the Department of Labor on behalf of American workers.”

• As Congress continues to debate the path forward on legislation to revive expired enhanced Affordable Care Act premium subsidies, last Thursday, President Trump made his first foray into the discussions when he outlined a healthcare affordability framework he wants Congress to consider. It is focused on sending federal funds directly to American consumers through health savings accounts (HSAs) to purchase insurance and cover medical costs. The plan also calls for lowering drug prices by tying U.S. prices to those paid in other countries, expanding direct-to-consumer drug sales through TrumpRx, and allowing certain medications to be sold over the counter if deemed safe, while requiring insurers to disclose more information on pricing, denied claims, and wait times. The framework was released as bipartisan Senate talks to revive the enhanced ACA subsidies remain stalled, with negotiators acknowledging legislative text will not be ready until late January due to continued disputes over abortion-related funding restrictions. In a related development, Johnson & Johnson announced that it reached an agreement with the administration to lower prices on certain prescription drugs and match prices charged in other developed countries in exchange for tariff relief. Under the agreement, J&J will sell select medicines directly to consumers at discounted prices through TrumpRx and offer comparable pricing to Medicaid. Of particular interest to MCAA members, the company also recommitted to its previously announced $55 billion investment in new facilities in Pennsylvania and North Carolina.

• The White House was forced to do damage control last week after President Trump sparked backlash during a visit to a Ford Motor Company assembly plant in Michigan where he was caught on video giving the middle finger to an auto worker who called the president a “pedophile protector” in reference to Jeffrey Epstein. The United Auto Workers union defended the worker, with UAW Vice President Laura Dickerson saying he was exercising free speech and vowing the union would protect his contractual rights after he was suspended by Ford following the incident. While in Michigan, President Trump spoke at the Detroit Economic Club and touted what he called a “Trump economic boom,” declaring that “inflation is defeated,” while blaming President Biden for what he called an “economic nightmare” of “stagflation.” He also said his administration is freezing or cutting federal payments to states and cities tolerating fraud or operating as “sanctuary” jurisdictions, and attacked Democratic elected officials for enabling fraud, crime, and illegal immigration. We are following up to ascertain if the asserted freeze will extend to federal funding for water infrastructure and other programs that create work opportunities for MCAA members.

• There were several developments last week that highlighted limits on the Administration’s authority to withhold federal funds and halt federal projects that create opportunities for MCAA members. Despite the President’s threats discussed above to strip federal funding from sanctuary cities and states, last Wednesday the Administration retreated from a legal fight over its earlier effort to condition transportation dollars on states aiding with immigration enforcement. The Department of Transportation (DOT) dropped its appeal of a November court ruling that barred it from withholding highway and transit funding from states that refused to cooperate with federal immigration authorities, ending a case brought by California and 21 other states. The decision leaves in place a ruling that DOT overstepped its statutory authority by conditioning infrastructure funding on immigration policy, providing greater near-term certainty for states relying on federal transportation dollars—even as the administration continues to pursue separate, state-specific funding claw backs and enforcement actions. Moreover, a federal court ruled last week that the Trump Administration violated the U.S. Constitution by canceling billions of dollars in clean energy grants based largely on the political leanings of the states receiving them. U.S. District Judge Amit Mehta found that the Department of Energy unlawfully terminated $7.6 billion in grants supporting hundreds of clean energy projects in 16 states that voted for former Vice President Kamala Harris in the 2024 election and concluded that this violated the Fifth Amendment’s Equal Protection guarantee. While the Trump Administration argued the cancellations were based on economic and energy policy concerns, as well as political considerations, the court said the record showed that the decisions were driven primarily by electoral considerations and lacked a rational government interest. The judge ordered the Department of Energy to immediately reinstate seven grants totaling $27.6 million involving the specific plaintiffs before the court while sharply criticizing the broader, politically motivated rollback of congressionally approved funding.

• Last Tuesday, the White House transmitted a slate of nominations to the Senate for consideration. Many of them are being re-nominated because they were not confirmed by the Senate prior to the end of the last session in December. MCAA is closely watching some of these nominations because they are for positions that will impact MCAA policy priorities, including: (1) Daniel Bonham to be the Labor Department’s Assistant Secretary for Congressional and Intergovernmental Affairs; (2) former Rep. Stevan Pearce (R-NM) to be Director of the Bureau of Land Management; (3) Carter Crow to be General Counsel of the EEOC; (4) Lee Beaman to be a member of the Board of Directors of the Tennessee Valley Authority; and (5) David MacNeil to be a member of the Federal Trade Commission.

• MCAA continued making progress on permitting reform through the regulatory process. Last Thursday, the Environmental Protection Agency (EPA) published a proposed rule to revise Section 401 of the Clean Water Act to streamline water quality certification for federally permitted projects. The proposed rule aims to accelerate approvals for data centers, pipelines, fossil fuel infrastructure, and other large-scale energy and development projects by rolling back elements of a 2023 Biden-era rule that the EPA says expanded Section 401 beyond its statutory purpose, allowing states and tribes to delay or block projects for reasons unrelated to water quality. Under the proposal, state and tribal reviews would be limited to assessing whether point-source discharges into waters of the United States comply with applicable water quality standards, consistent with statutory text and Supreme Court precedent. The rule would establish a single, standardized set of application requirements to trigger review, prohibit repeated withdrawal and resubmission of certification requests, reinforce the one year statutory deadline for decisions, and require clearer explanations for certification conditions or denials. The proposal also seeks to increase transparency and predictability by clarifying timelines for public hearings, defining procedures for resolving neighboring state objections, and reducing duplicative regulatory requirements, while preserving the role of states and authorized tribes as co-regulators under a framework of “cooperative federalism.” Additional details on the proposed rule can be found on the EPA’s website here.

Congress

• As the current January 30^th deadline for government funding approaches, the Senate last Thursday took a step toward avoiding a partial shutdown by voting 82-15 to pass and send to the president a three bill minibus spending package sent over from the House that includes the Energy-Water, Interior-Environment, and Commerce-Justice-Science appropriations bills. The Energy-Water spending bill includes: (1) $1.785 billion for nuclear energy at the Department of Energy; (2) $1.47 billion for the Bureau of Water Reclamation’s Water and Related Resources Account; (3) $1.95 billion for Energy Efficiency and Renewable Energy at the Department of Energy (a $1.5 billion decrease from FY2025); (4) $3.473 billion for the Harbor Maintenance Trust Fund; and (5) $396.8 million to the U.S. Army Corps of Engineers for construction projects on the inland waterways system. Additionally, the Interior-Environment spending bill includes: (1) a $7.4 million increase at the Bureau of Land Management for onshore oil and gas development; (2) a $11.2 million increase for the Bureau of Ocean Energy Management to develop offshore energy; and (3) a $21.2 million reduction in funding for renewable energy projects. Enactment of this package means that six of the 12 annual appropriations bills have now been signed into law. And last week ended with the House sending two additional funding bills to the Senate, the Financial Services and National Security–State appropriations bills, and there is some hope that the Senate can pass these two bills when it returns to session on January 26th. As a result, if funding lapses on January 30, it will constitute only a partial government shutdown limited to the agencies covered by the handful of unfinished appropriations bills, rather than a full shutdown of the federal government like we experienced last year. Despite this progress, lawmakers remain divided over the remaining measures. While there is some confidence that additional bills could be enacted before current funding expires on January 30^th, lawmakers increasingly expect the Labor-HHS and Homeland Security bills to be punted into a continuing resolution through the end of fiscal year 2026. The Labor-HHS bill remains stalled over disputes related to enhanced ACA subsidies, while DHS funding is tied up by Democratic concerns over financing the Trump Administration’s immigration enforcement operations.

• The fragility of House Republicans’ razor-thin majority that we have repeatedly commented on in our reports was on full display last Tuesday as the House failed to pass the Flexibility for Workers Education Act (H.R. 2262) by a vote of 209–215. The defeat resulted from not only GOP defections but also mounting attendance problems inside the Republican conference. Six Republicans—Reps. Brian Fitzpatrick (PA), Rob Bresnahan (PA), Nick LaLota (NY), Riley Moore (WV), Chris Smith (NJ), and Jeff Van Drew (NJ)—joined all Democrats in opposing the bill, which would have amended the Fair Labor Standards Act to clarify that “voluntary” training performed outside regular working hours does not count as compensable time for overtime purposes. The loss came amid a historically narrow GOP margin that has been strained by unexpected vacancies following the death of Rep. Doug LaMalfa (R-CA) and the retirement of Marjorie Taylor Greene (R-GA), as well as prolonged member absences. Several Republicans have missed weeks of votes, including Rep. Greg Murphy (R-NC), who is recovering from surgery; Rep. Derrick Van Orden (R-WI), who has been away caring for his sick wife; and Rep. Jim Baird (R-IN), who recently returned to D.C. after a car accident. Meanwhile, Rep. Wesley Hunt (R-TX) has missed dozens of votes already this year because he is prioritizing his primary campaign against Sen. John Cornyn (R-TX), further complicating the math for House Republican leadership, which now effectively needs near-perfect attendance to move legislation that lacks Democratic support. In the wake of the failed vote, Republican leaders pulled the Save Local Business Act (H.R. 4366)—a union-opposed bill to narrow the federal joint-employer standard—and postponed consideration of the Empowering Employer Child Care and Elder Care Solutions Act (H.R. 2270) and the Tipped Employee Protection Act (H.R. 2312), underscoring how absences and defections are increasingly paralyzing the House GOP’s legislative agenda heading into an election year.

• As the MCAA continues to engage on apprenticeship issues, including plans for implementation of President Trump’s Executive Order on “Preparing Americans for High-Paying Skilled Trade Jobs of the Future” to create one million new active apprentices nationally, we wanted to make MCAA members aware of Republicans’ plans to include apprenticeship provisions in a potential second reconciliation bill that is being discussed. Last Tuesday, the conservative House Republican Study Committee (RSC) unveiled a framework for a second Republican reconciliation bill, as Speaker Mike Johnson (R-LA) signaled he wants to press ahead with another party-line legislative package. Among other things, the RSC reconciliation framework would establish tax-advantaged “Jumpstart Accounts” to help individuals finance apprenticeship training and startup business costs, create a new employer tax credit to incentivize companies to onboard apprentices, and advance housing reforms aimed at expanding homeownership, restructure Affordable Care Act subsidies into health savings accounts rather than payments to insurers, and slash regulations viewed as a barrier to boosting energy production. Last Thursday, Rep. Riley Moore (R-WV) introduced standalone legislation modeled on the RSC framework’s Jumpstart Account proposal in recognition of the fact that any effort at a second reconciliation bill faces challenges within the House Republican caucus. This is because several key committee chairs, including House Ways and Means Committee Chair Jason Smith (R-MO), have publicly questioned whether another reconciliation bill is feasible given ideological divisions within the caucus, the GOP’s narrow majority, and the dynamics created by the upcoming midterm elections.

• As the MCAA continues to engage with Congress and the Trump Administration to roll back or clarify Biden-era regulations that created uncertainty for mechanical contractors, last Wednesday, the House passed the “SHOWER Act” (H.R. 4593) by a vote of 226-197, with 11 Democrats joining all Republicans in voting for the bill. It revises the definition of showerhead such that each head of a multi-head showerhead fixture is to be considered a separate showerhead allowed to spray up to 2.5 gallons of water per minute. Proponents of the measure argued that the bill will provide clarity and certainty for manufacturers and consumers by removing all ambiguity regarding the regulatory definition of a showerhead, adding that the bill aligns the statutory definition with the definition used by mechanical engineering associations.

• There were several interesting developments in races for the U.S. Senate last week. In Wyoming, Senate Majority Whip John Barrasso (R-WY) endorsed Rep. Harriet Hagemann (R-WY) in her bid for retiring Sen. Cynthia Lummis’ (R-WY) U.S. Senate seat. In North Carolina, Republican Senate candidate Michael Whatley reported raising $5.1 million in the fourth quarter of 2025, bringing his fundraising total to $11 million. In Alaska, former Rep. Mary Peltola (D-AK) announced she will challenge Sen. Dan Sullivan (R-AK) in Alaska’s U.S. Senate race and quickly demonstrated fundraising strength, raising $1.5 million in the first 24 hours of her campaign. In Texas, state Rep. James Talarico (D-TX) leads Rep. Jasmine Crockett (D-TX) in the state’s Democratic Senate primary by nine points. Meanwhile, in Maine, Texas, and Louisiana, President Trump has no plans to endorse in the remaining three Republican Senate races, leaving incumbent GOP Sens. Susan Collins (R-ME), John Cornyn (R-TX), and Bill Cassidy (R-LA) to face primary election voters without the official backing of the President.

• There were also many developments in races for the U.S. House last week that may interest MCAA members in different parts of the country. In Ohio, ICE Deputy Director Madison Sheahan resigned and launched a Republican bid to challenge Rep. Marcy Kaptur (D-OH) in Ohio’s 9^th Congressional District. In Ohio’s 3^rd congressional district, Air Force veteran Kristina Knickerbocker announced a run as a Democrat against incumbent Rep. Mike Turner (R-OH). In Virginia, Democrats passed their redistricting constitutional amendment for a second time, teeing it up for a vote in the state Senate as the party looks to redraw the state’s congressional map to favor Democrats ahead of the midterms. In California, a federal court upheld the state’s new, voter-approved congressional maps, rejecting Republicans’ claims that it amounted to an unconstitutional racial gerrymander. In Florida, Rep. Neal Dunn (R-FL) announced he is retiring from his seat in Florida’s 2^nd Congressional District, leading GOP businessman and attorney Keith Gross to launch a campaign to succeed Dunn. In Maine, state Sen. Joe Baldacci (D) announced he is running for the open seat in Maine’s 2^nd Congressional District to succeed retiring Rep. Jared Golden (D-ME). And in New York, the Congressional Black Caucus endorsed Rep. Adriano Espaillat (D-NY) in his Democratic primary, backing him over his democratic socialist challenger Darializa Avila Chevalier (D) for New York’s 13^th Congressional District. And the Cook Political Report shifted 18 House races toward Democrats, highlighting the party’s recent momentum heading into the midterm elections.

Around the Country

• Given the work MCAA’s lobbying team did to preserve the hydrogen tax credits in the One Big, Beautiful Bill Act (OBBBA) last year, we wanted to be sure MCAA members in Michigan were aware of Gov. Gretchen Whitmer’s (D) plans to make the Wolverine State a leader in geologic hydrogen to power cars, planes and factories without emitting greenhouse gases. To this end, Gov. Whitmer signed an Executive Directive last Thursday entitled, “Establishing the Michigan Geologic Hydrogen Exploration and Preparedness Initiative.” The directive states that Michigan is uniquely positioned to benefit from geologic hydrogen stored in the Midcontinent Rift beneath Michigan, and it directs state agencies to “coordinate infrastructure and workforce strategies to develop the resource in Michigan.”

• MCAA members who work at the Energy Department’s Portsmouth site in Piketon, OH should be aware that last Wednesday, the Energy Department’s Office of Environmental Management (EM) issued a final request for proposal (RFP) for a contractor to provide infrastructure support services (ISS) for a five-year period at DOE’s Portsmouth Site in Piketon, Ohio. The new contract will replace the current Portsmouth ISS contract held by North Wind Dynamics LLC, which will end in the first half of calendar year 2027. More information on the Portsmouth infrastructure support services program, including access to the final RFP and related documents, is available here.

• Fueling concerns that the buildout of AI infrastructure may be unsustainable, Oracle was sued by bondholders led by the Ohio Carpenters’ Pension Plan over the company’s failure to disclose that it needed to obtain an additional $38 billion in loans to fund two data centers in Texas and Wisconsin to support its deal to supply OpenAI with computing power. The lawsuit claims statements in offering documents for bonds the plaintiffs purchased only said that Oracle “may” need more money were false and misleading because the company was already securing the additional loans.

• Last Tuesday, Atlantic Alumina Company (ATALCO) announced a $450 million strategic partnership with the U.S. government and private investors to secure and expand the nation’s only domestic alumina refinery in Gramercy, Louisiana, including a $150 million preferred-equity investment from the U.S. Department of Defense and more than $300 million in private capital. The investment will return the facility to full production of more than one million metric tons of alumina annually, strengthening the upstream supply of the primary feedstock used to produce aluminum metal for U.S. manufacturing. Because alumina is the essential input for aluminum used extensively in HVAC systems, heat exchangers, ductwork, and other mechanical components, the expansion is expected to support greater domestic supply stability and reduce exposure to foreign-dominated markets, with direct implications for material availability and pricing.

• As the Environmental Protection Agency moves to mandate drinking water systems share their lead pipe inventory and removal plans by November 1, 2027, a new online interactive map from the New York League of Conservation Voters Education Fund shows how data can be used to drive planning for lead pipe removal operations. The New York map shows that there are 285,755 lead service lines and potentially another 966,085 pipes that could possibly be lead pipes in the state.

• Last week, a new poll showed that a record 45% of U.S. adults identified as political independents in 2025, surpassing prior highs and leaving equal shares—27% each—identifying as Democrats or Republicans. The rise in independence is driven largely by younger generations, with majorities of Gen Z and millennials identifying as independents. While fewer Americans now affiliate with either party, the poll finds that independents increasingly lean Democratic, giving Democrats a 47% to 42% edge in overall party affiliation—their first advantage since 2021—reflecting erosion in support for President Trump rather than increased favorability toward either party.

• As the MCAA continues to advocate for policies supporting nuclear energy deployment and the expansion of the nuclear supply chain, both the private sector and the Trump Administration took notable steps to advance those efforts. On January 9^th, Meta announced agreements with Oklo, TerraPower, and Vistra to help power its expanding AI infrastructure, a buildout expected to drive more than $14 billion in new advanced nuclear investment. The TerraPower agreement supports development of two Natrium reactors capable of producing up to 690 megawatts, with Meta also securing access to an additional 2.1 gigawatts from six future units, while the Oklo deal advances plans for an advanced nuclear campus expected to add up to 1.2 gigawatts to the grid. Meta’s agreement with Vistra provides 2.1 gigawatts from existing nuclear plants in Ohio and Pennsylvania. In connection with its broader AI and energy strategy, Meta also appointed Dina Powell McCormick—the wife of Sen. David McCormick (R-PA)—as president and vice chair to oversee its AI infrastructure portfolio, including its $27 billion data center project in Louisiana and large-scale nuclear development, a move publicly praised by President Trump. Separately, the Department of Energy’s Office of Nuclear Energy announced the establishment of a Center for Used Fuel Research at Idaho National Laboratory (INL), formally designating INL as DOE’s lead institution for research, development, and demonstration related to the storage, transportation, and disposition of used nuclear fuel.