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News & Press: Legislative Updates

Session Update - April 12, 2013

Tuesday, April 30, 2013   (0 Comments)
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The 2013 session began over three months ago with, for the first time in over two decades, the DFL party having control of the House and Senate and the Governor's office. There was consensus that balancing the budget in an effort to erase the current deficit was the top priority for the session. To address the deficit, the Governor proposed historic tax reform calling for an expansion of the sales tax to include a broad array of services and clothing. In response to stiff opposition, the Governor jettisoned this portion of his tax plan (only to see the Senate bring back portions of the plan in the last few days).

The Governor has since proposed a $59.4 million supplemental budget plan. This budget would be paid for, in part, by an income tax increase on the wealthiest 2% of Minnesotans, a cigarette tax, elimination of corporate tax credits and a tax on internet sales.

While everyone agreed the budget is a priority, there has been large scale disagreement over whether there should be a bonding bill. Despite the contrary opinions, the Governor released a $750 million bonding bill and the House released a package of state funded projects to the tune of $820 million.

CONSTRUCTION - WATER

Water is a hot topic this year. Key bills proposing water-related construction or regulation are: H.F. 819/S.F. 613 providing small community wastewater treatment grants; H.F. 581/S.F. 436 funding local inflow and infiltration reduction programs; H.F. 436/S.F. 1260 ranking criteria for wastewater treatment system projects, H.F. 540/S.F. 478 funding metro cities inflow and infiltration grants; H.F. 971/S.F. 1244 updating the Minnesota Public Drainage Manual and appropriating money; H.F. 1122/S.F. 1192 modifying the Clean Water Legacy Act to improve accountability; and H.F. 66/S.F. 113 modifying provisions for drainage systems. H.F. 66/ S.F. 113 was passed by both houses and signed into law by the Governor. The other bills are awaiting further action.

In addition, the Legislature is proposing considerable funding for water projects, including H.F. 680/S.F. 703 which would appropriate $50,000,000 for wastewater infrastructure.

CONSTRUCTION – ROADS, TELECOM, AND ENERGY

There are several legislative proposals of note for road, telecom and energy construction. They are: H.F. 1105/S.F. 688 limiting bridge engineering, design and construction costs in smaller cities; H.F. 1313 establishing pavement selection requirements for trunk highway purposes; H.F. 1526 requiring notice and coordination of transportation improvement and major projects; H.F. 1021 exempting minor ditch repair from environmental civil actions; and H.F. 548/S.F. 318 requiring the use or supply of American steel products on certain projects.

Several bills are particularly noteworthy: H.F. 956/S.F. 901, the Omnibus Energy bills, and H.F. 721/S.F. 694, the Governor’s Transportation budget bill.

One bill of particular interest to MUCA is H.F. 1564 requiring rulemaking to ensure private facilities and farm taps are subject to the excavation notice system. While this bill did not receive a hearing before committee deadline and, therefore, will not advance this year, it could be acted upon in the 2014 session.

CONTRACTS AND PROCUREMENT

A number of bills related to construction contracts and procurement have been introduced and considered this year, including: H.F. 446/S.F. 388 regulating building and construction contracts and indemnification agreements; H.F. 450/S.F. 392 modifying limitations on actions for damages based on services or construction to improve real property; H.F. 644/S.F. 561 regulating building and construction contracts and prohibiting third party insurance agreements; H.F. 1196/S.F. 843 authorizing competitive bid advertisement publications in a recognized industry trade journal; H.F. 866/S.F. 804 changing procurement and solicitation process provisions, changing nonvisual technology access standards, and providing for contracts with private entity services; and H.F. 1204/S.F. 742 establishing a transportation public-private partnership program and related regulations. Except S.F. 388 which did not meet committee deadline, the above bills are either on the House and Senate floors or awaiting action in a finance committee.

The following bills did not meet committee deadlines: H.F. 1562 requiring submission of subcontractor documents maintained by a contractor to an agency or municipality upon request and H.F. 952/S.F. 841 regulating building and construction contracts and requiring retainage to be held in escrow or trust accounts until released.

LABOR FORCE

Given the DFL House majority’s commitment to labor, it is not surprising there is legislation supporting workforce and economic development measures this year. H.F. 729/S.F. 1057, the Governor’s Omnibus Jobs and Economic Development bill, calls for streamlining construction inspections, reducing unemployment insurance tax, creating a Minnesota Jobs Creation Fund, and expanding the Minnesota Trade Offices. The Omnibus Jobs bill also includes: H.F. 1391/ S.F. 1343 appropriating money for and requiring a report on a collaborative job-based education and apprenticeship program and H.F. 1392/S.F. 1265 appropriating youth workforce development grant money. The House version appropriates $313 million and the Senate version appropriates $368 million. The House bill has been referred to the Ways and Means Committee and the Senate bill has been re-referred to the Finance Committee.

Also worth noting are: H.F. 1510/S.F. 1351 updating and making technical corrections to Hennepin County contract provisions which is awaiting floor action; H.F. 1649/S.F. 1129 authorizing hiring practices for the State, Minnesota State Colleges and Universities, the University of Minnesota and cities which include a program requiring the employment of a minimum percentage of low-income persons or former offenders in construction and service contracts; H.F. 1502/S.F. 1417 requiring Federal Disadvantaged Business Enterprise program waiver requests; and H.F. 1560 modifying data requirements on employees of a government contractor or subcontractor.

TAXES

The House Tax Committee will be taking up its Omnibus Tax bill on April 15. Two individual tax bills of interest are: H.F. 386 clarifying qualified small business and farm property tax exemptions and H.F. 1336/S.F. 1487 that proposes to increase the aggregate production tax rate.

Three months have come and gone and it seems to anyone on the outside that they’ll never get anything done. Over 1700 bills have been introduced in the House and more than 1500 in the Senate; yet, only ten bills have made it to the Governor's desk. The Legislature is still expected to adjourn on May 20, 2013.


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