MCAA Government Affairs Update for the Week of February 16, 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, February 16, 2026 MCAA Lobbying Firm, Longbow Public Policy Group provided the following information:

Trump Administration

• Last week, President Trump was promising repercussions, including “primaries,” for six House Republicans—Reps. Brian Fitzpatrick (PA), Don Bacon (NE), Kevin Kiley (CA), Thomas Massie (KY), Jeff Hurd (CO), and Dan Newhouse (WA)—who joined nearly all Democrats in a 219–211 vote to disapprove of the President’s 25% tariffs on Canada. The House-passed resolution would terminate the national emergency related to Canada that President Trump declared under the International Emergency Economic Powers Act (IEEPA), which is the justification for the tariffs on Canada. The measure now heads to the Senate, where similar resolutions have previously drawn bipartisan support, but there is not enough support in the House or Senate to override a Presidential veto. The vote came after Speaker Johnson’s (R-LA) effort last Tuesday to prevent any House votes disapproving of President Trump’s tariffs failed by a vote of 214-217 in which Reps. Thomas Massie (R-KY), Kevin Kiley (R-CA), and Don Bacon (R-NE) joined all Democrats to defeat the rule. The measure would have barred votes on resolutions disapproving President Trump’s tariffs through July 2026. The developments come as the New York Federal Reserve reported that Americans are bearing roughly 90% of the cost of the tariffs and foreign exporters have generally not reduced prices to offset the levies.

• Last week, the Congressional Budget Office (CBO) released its annual benchmark forecast for the federal budget, projecting that the U.S. government will run a $23.1 trillion cumulative deficit over the next nine years—$1.4 trillion more than it estimated last year. CBO now estimates that federal debt will reach 120% of GDP by 2036, surpassing record levels reached in the aftermath of World War II. This comes as a separate CBO report projects that the Social Security Old-Age and Survivors Insurance trust fund that issues payment to 70 million Americans will be depleted by 2032. Moreover, the combined Social Security trust funds are now projected to be exhausted in 2033, potentially leading to a 20% benefit cut. CBO notes that 41% of Americans aged 65 and older rely on Social Security for 50% or more of their income.

• As the MCAA continues engaging on issues related to federal decarbonization policy, members should be aware that last Thursday, the Environmental Protection Agency (EPA) finalized its repeal of the 2009 Obama-era greenhouse gas (GHG) “endangerment finding.” This is the scientific determination that GHG emissions threaten public health and welfare that is the legal basis for regulating six greenhouse gases—hydrofluorocarbons, methane, carbon dioxide (CO₂), perfluorocarbons, nitrous oxide, and sulfur hexafluoride—under the Clean Air Act (CAA). The EPA simultaneously repealed CO₂ standards for cars and trucks, asserting that Section 202(a) of the CAA does not authorize EPA to regulate greenhouse gases in the manner previously used. Gov. Gavin Newsom (D-CA) said his state will sue EPA over the repeal. Because the endangerment finding has long served as the legal underpinning for regulating greenhouse gas emissions from stationary sources—including power plants and major oil and gas facilities—the move is expected to spur broader challenges to existing and future climate regulations beyond the transportation sector.

• Last Thursday, the Federal Trade Commission (FTC) issued a direct final rule removing from the Code of Federal Regulations its 2024 Biden-era final rule prohibiting most non-compete clauses in employment contracts. As you may recall, MCAA filed comments expressing concerns about this FTC regulation in April 2023 and successfully lobbied the Trump FTC to abandon it last September as we highlighted at the Industry Funds Conference in December. This action by the FTC represents the formal regulatory conclusion of this successful advocacy effort. The FTC has made clear it has no plans to issue a new blanket rule on non-compete agreements. As we have previously reported, the FTC has affirmed legitimate uses of such agreements for purposes such as those raised in MCAA’s 2023 comments. And the Commission is pivoting back to case-by-case enforcement against non-competes that violate longstanding, common law limitations on such agreements and violate fair competition standards enforced by the FTC applicable to labor markets.

• The Nuclear Regulatory Commission (NRC) last Tuesday issued guidance detailing the steps that NRC licensees should take (or ensure their contractors are taking) to validate the non-immigrant status and identity of foreign nationals prior to granting unescorted access or certifying unescorted access authorization (UAA) for workers doing construction, maintenance, and other work at nuclear power plants and other NRC-regulated facilities. The guidance requires a visual verification of documents and official government-issued photo identification (e.g., passport, Work Authorization Document, or visa) provided by non-immigrant foreign nationals. It also requires that the demographic information of foreign nationals be entered into the U.S. Citizenship and Immigration Services’ Systematic Alien Verification for Entitlements (SAVE) electronic database to confirm the accuracy of documents and identification presented by the foreign national. The NRC stresses that “a licensee that accepts an access authorization program implemented by a contractor or vendor to satisfy 10 CFR 73.56(d)(3) must ensure that this validation has been performed prior to granting unescorted access or certifying UAA.” Such contractors and vendors do not have access to the SAVE database that is available to NRC licensees but can instead use E-Verify.

• Amid continued growth in data centers and broader electrification, federal energy forecasters are projecting sustained increases in U.S. power demand over the next two years. The U.S. Energy Information Administration (EIA) last Tuesday projected U.S. electricity demand will reach record highs, from 4,195 billion kWh in 2025 to 4,268 billion kWh in 2026 and 4,372 billion kWh in 2027, driven by expanding AI and crypto data centers. The power generation mix is expected to shift modestly over the forecast period. Natural gas will supply 40% of electricity in 2026 and 39% in 2027. Coal will provide 16% in 2026 and 15% in 2027. Nuclear is expected to remain steady at 18%. Conventional hydropower will also hold steady at 6%. Wind will provide 11% in 2026 and 12% 2027, while solar will provide 8% in 2026 and 9% in 2027. Other sources will provide 1%. EIA also forecasts Brent crude averaging $58 per barrel in 2026 and $53 in 2027, while Henry Hub natural gas prices are projected to average $4.31 per MMBtu in 2026 and $4.38 in 2027, reflecting tighter near-term gas markets and rising production later in the forecast period. The federal data comes as a separate report from Goldman Sachs shows that in 2025 electricity prices jumped 6.9% year over year, more than double the headline inflation rate of 2.9%. Goldman says electricity prices will continue to rise through the end of the decade as data centers make up 40% of electricity demand growth. The bank believes that absent increased generating capacity, the nation’s energy situation could lower disposable income, drag down consumer spending, and slightly slow economic growth in the coming years.

• Last Tuesday, the Labor Department’s Inspector General (IG) transmitted its fiscal year 2026 audit workplan to Congress, flagging several programs of interest to MCAA members for audits and reviews this year. The workplan includes multiple workforce-program audits, including the Office of Apprenticeship’s Apprenticeship Building America grants and the Employment and Training Administration’s management of registered apprenticeship grant programs. The IG is also continuing an audit examining allegations that DOL offices—including the Employee Benefits Security Administration that oversees ERISA retirement and health plans and the Wage and Hour Division (WHD)—inappropriately shared confidential information with plaintiffs’ attorneys in class-action litigation targeting employers and their retirement and health plans. The plan also includes reviews of WHD enforcement of child labor laws, OSHA’s actions to address and prevent workplace violence, and the administration of foreign guestworker programs.

• Last Monday, President Trump said he does not plan to pursue another party-line budget reconciliation package, like the One Big Beautiful Bill Act (OBBBA) in which MCAA realized several legislative goals last year. The President said his administration has already enacted “everything” needed for the next four years through the OBBBA and “now we just need to manage it.” His comments undercut ongoing discussions MCAA has closely followed among House and Senate Republicans about crafting a follow-up reconciliation package that could bypass a filibuster by Senate Democrats. While President Trump left the door open to additional legislation, he said it would be smaller, targeted bills rather than another sweeping package like the OBBBA. This certainly leaves space for MCAA legislative priorities ranging from permitting reform to improvements to government contracting and further decarbonization efforts.

• As MCAA members and other employers continue focusing on compliance with the sometimes complex web of federal, state, and local laws and regulations governing family and medical leave, the Labor Department (DOL) marked the 33^rd anniversary of the federal Family and Medical Leave Act (FMLA) by highlighting six best practices to help employers ensure compliance with FMLA and avoid common violations. The guidance from the Wage and Hour Division emphasizes correctly determining coverage and employee eligibility, clearly communicating FMLA rights and responsibilities, avoiding interference or retaliation, properly handling medical certifications, and maintaining required health benefits and job protections during leave. DOL cautions that clear notice and consistent communication are among the most frequent compliance gaps identified in investigations and remain key to reducing enforcement risk.

Congress

• Before leaving for this week’s President’s Day recess, the Senate last Thursday voted 52-47 to block consideration of a House-passed Department of Homeland Security (DHS) funding bill, ensuring a shutdown of most of DHS beginning last Saturday. Negotiations between the White House and Senate Democrats are continuing on Democrats’ demands for limits on immigration enforcement in the wake Alex Pretti’s death in Minneapolis at the hands of federal immigration agents. Because both Immigration and Customs Enforcement and Customs and Border Protection received significant additional funding under the One Big Beautiful Bill Act, a funding lapse will not materially impact the operations of the agencies. And many repercussions of a lapse in funding will not be felt immediately. For example, TSA airport screeners will not miss full paychecks until March. The Federal Emergency Management Agency still has $7 billion dollars it can deploy for immediate response to disasters like hurricanes, tornadoes and floods. And the Department can shift money to ensure Coast Guard personnel get paid. Still, the lapse in funding is expected to reduce personnel working at many DHS components, and will impact the public more directly if it is not resolved this month.

• As House Republicans continue to navigating a razor-thin majority, last Wednesday, Rep. Neal Dunn (R-FL) told Florida sources that he is thinking about resigning from Congress before the midterms. Speaker Mike Johnson (R-LA) is begging him to remain because his departure would further reduce the thin GOP House majority. Dunn had already announced last month that he would not seek reelection to his seat in Florida’s 2^nd Congressional District, but was expected to remain until the end of this Congress.

• Last Wednesday, the MCAA policy team monitored the House Education and Workforce Subcommittee on Workforce Protections’ hearing entitled, “Building an AI-Ready America: Safer Workplaces Through Smarter Technology,” examining how AI and advanced technologies are being deployed to prevent injuries and modernize safety practices in construction, transportation, warehousing, and other high-risk sectors. This followed a separate Subcommittee hearing on AI and the workforce that we detailed in our February 9 report. At this latest AI hearing, Republicans generally emphasized that AI-powered tools—such as wearable sensors, computer vision, and predictive analytics—are helping shift safety management from reactive enforcement to proactive, data-driven prevention, while underscoring the need for human oversight and balanced policy. Democrats acknowledged AI’s potential to improve safety but generally cautioned that automation and algorithmic management can intensify surveillance, increase work pace, and weaken worker protections without clear guardrails and enforcement capacity. Jeff Buczkiewicz, CEO of the Mason Contractors Association of America, testified that the construction trades are developing “purpose-built” AI tools tailored to real-world jobsite risks, including systems that evaluate wall bracing to prevent collapses, monitor personal protective equipment (PPE) in real time, integrate LiDAR scanning to assess performance, and deploy virtual reality forklift simulations to allow workers to learn from mistakes without physical harm. He argued that responsible adoption can extend careers, boost productivity, and help offset looming workforce retirements. Johan Land of Samsara highlighted measurable safety gains from AI-enabled fleet systems, including reductions in crashes and distracted driving. Eric Hoplin of the National Association of Wholesaler-Distributors described warehouse applications such as computer vision and predictive “digital twin” systems to anticipate equipment failures and cautioned against fragmented federal and state regulatory approaches. Former OSHA Assistant Secretary Douglas Parker, representing the National Employment Law Project, supported AI adoption grounded in established safety principles and urged Congress to strengthen the Labor Department’s capacity to oversee emerging technologies.

• MCAA will be closely monitoring forthcoming conference negotiations over differing housing bills the House and Senate have now passed. Last Monday, the House voted 390-9 to approve the Housing for the 21^st Century Act. The bill directs the Department of Housing and Urban Development (HUD) to issue voluntary zoning modernization guidelines to encourage states and localities to update restrictive land-use policies and authorizes grants for “pattern books” featuring pre-approved housing designs to speed local approvals. It establishes federal guidance and pilot programs for single-staircase multifamily buildings (three stories or more), a change intended to expand apartment construction options. The measure also significantly streamlines environmental reviews by expanding National Environmental Policy Act (NEPA) exemptions and categorical exclusions for infill, rehabilitation, and certain new residential construction projects, and by synchronizing HUD and U.S. Department of Agriculture review standards to reduce duplication. Additionally, it updates Federal Housing Administration multifamily loan limits to better reflect current construction costs, expands HOME and CDBG flexibility to support affordable housing construction and related infrastructure, and eases environmental mandates that often delay smaller-scale multifamily and infill developments. The bill must now be reconciled with a notably different Senate housing bill called the ROAD to Housing Act that the chamber passed last October. MCAA will be monitoring to fend off efforts we mentioned at the Industry Funds Conference in December to advance language curtailing federal prevailing wage or the use of project labor agreements on federally-assisted multifamily housing projects. As we noted in December, the U.S. Small Business Administration is among the entities that has asserted that project labor agreements are contributing to the housing affordability crisis.

• There were several developments in races for the U.S. Senate last week. In Maine, Sen. Susan Collins (R-ME) formally announced she is running for re-election to the U.S. Senate and one of her potential Democratic opponents, Gov. Janet Mills (D), launched a new ad characterizing her as “always concerned, but never courageous.” In Texas, Turning Point Action, the political arm of the late Charlie Kirk’s Turning Point USA, endorsed Texas Attorney General Ken Paxton in the Republican U.S. Senate primary against incumbent Sen. John Cornyn (R-TX). The endorsement came as Republican donors privately urged President Trump to endorse Cornyn, warning that a contested race could drain resources and risk a competitive general election. In Nebraska, Independent Senate candidate Dan Osborn canceled a planned fundraiser after it was revealed that co-host Dana Chasin was referenced in a Justice Department email involving Jeffrey Epstein. In Ohio, Senators Bernie Moreno (R) and Jon Husted (R) are trying to figure out what to do with donations they got from billionaire Leslie Wexner, who is listed as a potential “co-conspirator” in the Epstein files. And in North Carolina, Americans for Prosperity, the political arm of the Koch network, launched a seven-figure ad buy backing Republican Michael Whatley in his race to succeed retiring Sen. Thom Tillis (R-NC).

• There were also several developments in races for the U.S. House last week. In New Jersey, former Rep. Tom Malinowski (D-NJ) conceded the Democratic primary in the special election for New Jersey’s 11^th Congressional District to progressive Analilia Mejia (D-NJ), who will face Republican Joe Hathaway in a special general election on April 16^th. In Pennsylvania, Rep. Brian Fitzpatrick (R-PA) holds a considerable fundraising advantage over his Democratic opponent Bob Harvie with over $7.3 million in cash on hand, compared to $400,000 for Harvie. In Illinois, the Justice Democrats endorsed Kat Abughazaleh (D) in the crowded Democratic primary to replace Rep. Jan Schakowsky (D-IL) in Illinois’ 9^th Congressional District. In Tennessee and Florida, Democrats are increasingly hopeful they can seriously compete for House seats held by scandal-ridden GOP Reps. Andy Ogles (R-TN) in Tennessee’s 5^th Congressional District and Cory Mills (R-FL) in Florida’s 7^th Congressional District. Meanwhile, the Democratic Congressional Campaign Committee expanded its House battleground map to five additional red-leaning districts, signaling continued Democratic confidence in flipping the chamber in 2026. The new targets include seats held by GOP Reps. Jeff Crank (CO), Brad Finstad (MN), Ryan Zinke (MT), and John McGuire (VA), along with South Carolina’s 1st District, which is open as Rep. Nancy Mace (SC) runs for governor.

Around the Country

• Last Thursday, the U.S. Court of Appeals for the Second Circuit declined to block a district court order compelling the Trump Administration to resume funding for the $16 billion Gateway/Hudson Tunnel Project between New York and New Jersey. The appellate court scheduled oral arguments for the week of February 23^rd but refused to grant the Justice Department’s request for an interim stay, meaning the Trump Administration may be required to disburse roughly $200 million in near-term project funds. The underlying lawsuit, brought by New York and New Jersey, challenges the Transportation Department’s funding freeze as arbitrary and inconsistent with federal law.

• As electricity demand accelerates—driven in by AI and data center expansion—the Trump Administration is signaling support for keeping existing coal power plants operating longer. Last Wednesday, President Trump signed an executive order, “Strengthening United States National Defense with America’s Beautiful Clean Coal Power Generation Fleet,” directing the Department of Defense, in coordination with the Department of Energy, to pursue long-term Power Purchase Agreements with coal-fired plants to supply military installations and other mission-critical facilities. The order designates coal generation as essential to grid reliability, blackout prevention, fuel security, and defense “mission assurance.” Following the order, the Energy Department announced $175 million in funding to modernize and extend the life of six coal-fired power plants: the Mountaineer and John E. Amos plants in West Virginia, the Fort Martin Power Station in West Virginia, the Cardinal Plant and Kyger Creek Station in Ohio, the Belews Creek Steam Station in North Carolina, and the Ghent Generating Station in Kentucky, as part of a broader $525 million effort to reinvest in and expand America’s coal-powered generation. Relatedly, the Tennessee Valley Authority (TVA) signaled that it will continue operating two coal-fired plants—the Kingston and Cumberland Fossil Plants in Tennessee. TVA reversed its prior plan to retire remaining coal units by 2035 due to regulatory changes and rising electricity demand. TVA’s revised approach would still include adding natural gas-fired generation at both sites.

• As the MCAA policy team continues working with the Trump Administration on implementing the ADVANCE Act, federal agencies are continuing to rollout pilot programs to encourage more private-sector investment. An example of this is California startup Deep Fission Inc., which previously participated in an Energy Department pilot program, announcing last Tuesday that it has raised $80 million in new financing to accelerate commercialization of its underground small modular reactor (SMR) technology. The company also announced a strategic partnership with Blue Owl Capital’s Real Assets platform to help deploy its reactors for digital infrastructure projects and said it has a development pipeline representing 12.5 gigawatts of planned future deployments. Deep Fission’s design that was validated in an Energy Department pilot combines traditional pressurized water reactor technology with deep borehole drilling techniques used in the oil and gas industry, aiming to lower construction costs and speed deployment compared to conventional nuclear plants.

• MCAA members operating in California should note that the Department of Labor last Tuesday announced a settlement with Kaiser Foundation Health Plan Inc. resolving multiple investigations into the company’s failure to provide adequate access to in-network mental health and substance abuse disorder services for millions of Californians covered through employer-sponsored plans. Kaiser maintained insufficient provider networks and used patient questionnaires in ways that improperly limited access to care, forcing many members to seek out-of-network treatment at higher cost. The settlement requires Kaiser to pay at least $28.3 million to reimburse members for out-of-network expenses and a $2.8 million civil penalty. Kaiser is also implementing reforms to reduce wait times, improve medical necessity reviews, and strengthen monitoring of network adequacy. Kaiser has notified potentially affected members enrolled since January 1, 2021 that they may be eligible for reimbursement.

• As tech companies’ capital expenditures to build out AI infrastructure are projected to reach roughly $610 billion in 2026—nearly triple 2023 levels—state policymakers are continuing to scrutinize the energy, environmental, and ratepayer impacts of rapid data center expansion. In Virginia, the home of “data center alley,” lawmakers last week advanced HB 1132, which would require counties with at least 20 data centers—currently Loudoun, Fairfax, and Prince William—to dedicate 30% of future property tax collections from data centers to residential solar and battery projects and offset the state’s vehicle property tax. Virginia lawmakers also introduced HB 897, which would condition the state’s sales tax exemption on operators procuring more zero-carbon energy, reducing diesel backup generation, and meeting energy efficiency targets. The IBEW and other unions are cautioning the measures could deter investment, citing recent construction growth in the region. In Pennsylvania, following Gov. Josh Shapiro’s (D) call for stronger development standards, Senate leaders have signaled bipartisan support for requiring data center developers to supply their own power to protect grid reliability and affordability. All of this comes as new research from water technology firm Xylem and other organizations projects that water demand tied to data center growth could increase by 129% by 2050, raising concerns about water supply and treatment capacity in certain regions.

With Congress in recess for the President’s Day holiday, there will not be a MCAA Government Affairs Update on Monday, February 23, 2026. Watch for the next update on Monday, March 2, 2026.