Wednesday, November 19, 2008 at 2:00-3:30pm ET
Register today for the Using Electronic Communications on Construction Projects webinar and get insightful and practical tips from the person who led the national effort to create the ConsensusDOCS 200.2 – the new Electronic Communications Protocol Addendum. Learn how you can manage your risks and contractual responsibilities and how 200.2 can be customized to meet project-specific needs  Click here for more information. 

For more information, contact Cassia Griffin at griffinc@agc.org.

Voters on Election Day approved a huge schedule of state and local bond and tax issues in support of infrastructure spending for schools, colleges, other public buildings and highways. The Bond Buyer estimated that successful bond issues alone totaled $54 billion, the second-highest total after 2006 and about 82 percent of issues on the ballot.

The presidential and congressional election results make it more likely that infrastructure spending will be part of a new fiscal stimulus bill, either this month or early in 2009. In the long term, an Obama administration may be more supportive of a larger surface transportation funding bill once Congress gets around to writing a replacement for SAFETEA-LU, the funding bill that expires on September 30, 2009.

Meanwhile, however, credit markets, economic indicators and state and local receipts are all pointing to tough times in the near term for contractors. Municipal bond markets have reopened to some state and local borrowers, but developers continue to have trouble lining up bank financing. The dismal news about job losses, shrinking consumer spending, weakening exports and business investment make many private projects less attractive than they were a few months ago. Plunging portfolios have forced universities and hospitals to postpone construction that they expected to fund from endowment earnings or capital campaigns. Tumbling tax receipts are causing governors, mayors and school boards to rewrite budgets, often by deferring construction projects.

Owners who do go ahead with projects will be pleasantly surprised in many cases by how much less they cost than they would have a few months ago. As of November 10, the national average retail price of diesel fuel had fallen 38 percent from the peak in July to $2.94 per gallon, a 14-month low. Steel and copper prices are also beginning to skid, and other key materials are likely to drop over the next several months. Contractors and subcontractors are eager to bid.

These conditions should spur both public and private owners to launch construction in 2009, especially since materials prices could resume their upward march in 2010 if world economic growth accelerates again. But getting the go-ahead may require a lot of persuading.

For more information, contact Ken Simonson at (703) 837-5313 or simonsonk@agc.org.

On October 29, 2008, The U.S. Department of Labor (DOL) issued its final rule revising the federal regulations (29 CFR part 29) that implement the National Apprenticeship Act. AGC submitted comments in March 2008, generally in support of the revisions as proposed.  Many AGC comments were taken into account in the final rule.
This is the first overhaul of the regulations in 30 years and substantially changes both how an apprentice can become a journeyworker and how the system is managed. The final rule takes effect December 29, 2008, but State Apprenticeship Agencies have up to an additional two years from that date to implement the changes.
Among the changes requested by AGC that were incorporated into the final rule:

• The definition of a “competency-based program” was changed to make it clear that apprenticeship programs using this approach must still require an on-the-job component and that the program standards must “Identify an appropriate means of testing and evaluation for such competencies;”
• An apprenticeship program may go for up to one year without any apprentices, to give small programs that may to go for short periods of time with no apprentices the ability to maintain their status;
• The section on program performance evaluation was amended to add that any “tools and factors” must adhere to goals and policies as outlined by the U.S. Department of Labor. As originally proposed registration agencies were free to add any “tools and factors” to the three items listed by the federal  government; and
• The definition of “completion rates” was changed so that programs will be compared to a “national standard” for that occupation and industry instead of compared to other programs in the same geographic area.

In addition, the final rule:

• Adds two methods – competency-based and a hybrid approach – to the traditional, time-based method for an apprentice to obtain journeyworker status;
• Allows for the inclusion of technology-based and distance learning;
• Gives registration agencies the option to issue interim credentials;
• Establishes a 90-day timeframe for registration agencies to process sponsor requests for registering and modifying program standards and 45-day timeframes for sponsors to notify registration agencies regarding other employment and apprenticeship agreement changes;
• Provides for reciprocal approval, for federal purposes, of apprentices, apprenticeship programs, and standards that are registered in other states for all industries and occupations.  The rule requires apprenticeship program sponsors seeking reciprocal approval to meet the wage and hour provisions and apprentice ratio standards of the reciprocal state;
• Introduces provisional, one-year approval for newly registered programs.  After one year, programs meeting the regulatory standards either may be permanently approved or have their provisional registration extended through the end of the first training cycle;
• Limits a registration agency to a State Apprenticeship Agency.  State Apprenticeship Councils will continue to be required for advisory or regulatory purposes but can no longer be a registration agency; and
• Includes a new section, 29.6, on performance standards.  Programs will be evaluated on the basis of completion rates, the use of quality assurance assessments, and Equal Employment Opportunity Compliance Reviews.  Programs with completion rates below the national average for that industry and occupation will be provided with technical assistance to help them meet the national average.

All programs currently in effect do not have to be revised as a result of this rule.
In discussing the new rule, DOL personnel said there are several areas where it will be seeking additional policy guidance in the coming months, including: performance standards, electronic media, provisional registration, interim credentials and competency-based apprenticeship programs.
A short fact sheet, full text of the new rule, press release, and other information on the final rule are available here. Additionally, DOL has set up a specific e-mail to answer questions related to the new rule. Questions and answers will be posted to the Web site referenced above.

For more information, contact Liz Elvin at (703) 837-5389 or elvinl@agc.org.