Construction Industry Wants Answers From Clinton, Trump

Daily Labor Report® is the objective resource the nation’s foremost labor and employment professionals read and rely on, providing reliable, analytical coverage of top labor and employment...

By Elliott T. Dube and Sean Forbes

Oct. 7 — Construction industry members are seeking more specifics from U.S. presidential candidates on issues such as infrastructure investment and the industry’s skilled labor shortage as Election Day approaches.

For instance, a 34-member coalition of business groups and unions Oct. 5 sent a letter to the Clinton and Trump campaigns, praising them for each supporting “dramatic increases” in infrastructure investment. The letter also asked how each campaign would go about making the Highway Trust Fund, which supports highway and transit programs, permanently solvent.

The coalition includes groups such as the U.S. Chamber of Commerce, the Associated General Contractors of America (AGC), the National Electrical Contractors Association, the International Union of Operating Engineers, the Laborers’ International Union of North America and Building America’s Future.

The Construction Employers of America, a coalition of six contractor associations, said that in addition to infrastructure development, the candidates should address how worker misclassification and undocumented workers affect the construction industry.

Infrastructure development—at least at the state and municipal levels—is on the upswing, with bond sales expected to be the highest since 2010, reaching $400 billion by year-end.

Coalition Seeks Greater Certainty

The “very different” groups in the coalition are joining to pursue more certainty in terms of infrastructure funding, which would in turn spur more private and public investment in transportation projects, AGC spokesman Brian Turmail told Bloomberg BNA Oct. 6.

Both candidates have championed infrastructure investment “in one form or another,” Turmail said. The coalition is seeking details from Hillary Clinton and Donald Trump on how they would fund any investment in a sustainable way, he said.

“They understand that there’s both an immediate need, because our infrastructure is aging, and a broader economic benefit to invest in infrastructure,” he said. “It’s nice to see the candidates from both parties on the same page. At the same time, neither have talked about how they’ll pay for that infrastructure.”

The upcoming Oct. 9 town hall-style presidential debate at Washington University in St. Louis will give industry members a chance to put questions important to them before candidates Clinton and Trump.

The Commission on Presidential Debates has stipulated that while half the questions at the debate will come from audience members, the other half will be “posed by the moderator based on topics of broad public interest as reflected in social media and other sources.” Debate moderators have agreed to consider the 30 questions that receive the most up-votes at the Open Debate Coalition’s website.

AGC is encouraging its members to go online and promote infrastructure-related questions for the next debate, Turmail said.

Letter Wonders About FAST Act Follow-Up

In December, President Barack Obama signed into law the Fixing America’s Surface Transportation (FAST) Act, an approximately $300 billion bill renewing surface transportation programs through 2020. The House and Senate approved the legislation following months of delays and short-term extensions. Before that, in 2012, Congress passed a two-year surface transportation reauthorization known as Moving Ahead for Progress in the 21st Century (MAP-21).

The Highway Trust Fund gets revenue from federal motor fuels taxes. Neither MAP-21 nor the FAST Act increased those taxes or created any new sustainable revenue sources for the trust fund, the coalition’s letter to the Clinton and Trump campaigns said. Though the two laws served important short-term functions, they haven’t made “any progress” toward ensuring the trust fund’s long-term solvency, it said.

“The resulting uncertainty has had dramatic negative effects on the ability of state and local governments to plan, fund, and construct transportation projects,” the letter said. “As a consequence, the economy has missed an opportunity to increase good paying jobs and has hampered America’s economic competitiveness.”

The FAST Act included several non-transportation-related pay-fors, including revenue from revoking passports of tax-delinquent individuals and tapping into surplus Federal Reserve funding. Congress “shook the couches free for whatever change they could find,” Turmail said.

“There’s no more couch change for transportation,” he said. “And no one has put forth how we’re going to pay for transportation beyond the gas tax that’s clearly not raising enough at its current level to meet our needs.”

Regulations, Corporate Taxes

The Construction Employers of America and the American Subcontractors Association each cited the skilled worker shortage and added a couple other questions.

Jack Jacobson, spokesman for the CEA, in Washington, told Bloomberg BNA Oct. 7 that worker misclassification and illegal immigration are also important matters that the next administration will have to contend with.

“Many construction firms who should be hiring full-time employees and providing them benefits and paying taxes are instead bringing workers on board illegally as ‘independent contractors,’” Jacobson said. “Other firms simply hire the cheapest labor they can find, which frequently includes undocumented workers. When this happens, employees are robbed of benefits and taxes go unpaid. How would you address worker misclassification through better enforcement or IRS action?”

Kerrick Whisenant, past president of the American Subcontractors Association and executive vice president for operations at Cornerstone Detention Products Inc. in Madison, Ala., posed a question about regulations and offered a recommendation about corporate tax rates.

Whisenant told Bloomberg BNA Oct. 7 that he would ask the candidates how they would reduce the burden of regulations on the construction industry. “What’s your plan to open up our industry so it’s not stifling us from creating jobs and getting on with business as usual, but still maintaining safety and sound environmental practices?”

Reducing corporate tax rates for S corporations, which is how most subcontractors are organized, also would boost the industry because subcontractors would have the money to re-invest in their business to recruit and train workers, Whisenant said.

To contact the reporters on this story: Elliott T. Dube in Washington at edube@bna.com; Sean Forbes in Washington at sforbes@bna.com

To contact the editor responsible for this story: Jo-el J. Meyer at jmeyer@bna.com

For More Information

Text of the coalition’s letter to Clinton is at http://src.bna.com/jd5, and the letter to Trump at http://src.bna.com/jd6. The Open Debate Coalition’s website for debate questions is at https://presidentialopenquestions.com.

Copyright © 2016 The Bureau of National Affairs, Inc. All Rights Reserved.