Contractormag 3360 Capitolbuilding

The IAPMO Group Washington update

Sept. 19, 2016
By a vote of 95-3, the Senate authorized the U.S. Army Corps of Engineers to begin 27 water-related infrastructure projects The House this week passed legislation that reforms and reauthorized the Carl D. Perkins Act The chairmen of the House and Senate tax-writing committees asked seven large solar energy companies for information about their use of a federal program

Congressional Update

Last Week: The House passed legislation to prohibit the transfer of detainees at Guantanamo Bay, a bill to repeal a piece of the Affordable Care Act (Obamacare) to allow Americans to deduct more out-of-pocket medical expenses and a bill to reform the Department of Veterans Affairs. The Senate passed a water resources development package (see below).

This week: The House will debate a bill to require reporting on the financial assets acquired by Iranian leaders. The Senate is likely to pass a continuing resolution to fund the federal government from October 1 through December 9.

Senate Passes Legislation Authorizing EPA’s WaterSense Program. The Senate this week today passed sweeping legislation addressing the nation's water infrastructure, including authorization for the U.S. EPA's WaterSense program, for which IAPMO has been an important advocate. By a vote of 95-3, the Senate authorized the U.S. Army Corps of Engineers to begin 27 water-related infrastructure projects. The projects include increasing port capacity, improving coastal and inland navigation, and hurricane mitigation and ecosystem restoration. It also appropriates and authorizes funding for a new EPA emergency infrastructure program for drinking water projects, lead pipe removal, contamination testing and lead poisoning monitoring programs. These provisions were included to address the lead contamination crisis in the city of Flint, Michigan. The path forward: the House is expected to vote on its version of WRDA 2016 in the week of Sept. 19, according to Rep. Fred Upton (R-Mich.). The House bill (H.R. 5303) will likely be taken up as a suspension vote, meaning no amendments will be offered to the bill. If that pans out, Congress will then go to conference on the bill during the lame duck session. More information can be found here:

First Veto Override? The House last week followed the Senate in unanimously passing a bill that would give victims of terrorism greater latitude to seek restitution from terrorist groups and parties that assist them. President Obama will soon veto the legislation out of concern about its potential unintended consequences—in particular, foreign governments, Saudi Arabia most notably, would be subjected to potential lawsuits under the bill and could take retaliatory action against the U.S. Congress can override the veto with a two-thirds majority in each body. The bill’s powerful sponsors appear intent on pursuing a veto override and likely will be successful in handing the President the first and likely only veto override over his eight years in office.

Negotiations To Keep Government Open Continue. While the Senate had hoped to pass a Continuing Resolution that would keep the government running past October 1st this week,  the negotiations over the details of a plan now are expected to run into the weekend. Talks have slowed on how Planned Parenthood might share in funds to combat the Zika crisis. Senate Majority Whip John Cornyn and other lawmakers say they don't expect to announce the parameters of a deal on a new stopgap until Monday. Besides issues related to Zika, the negotiations also were complicated by an eleventh-hour effort by the White House and storm-ravaged states to attach disaster funds to the continuing resolution. In spite of the delay, there is a sense that talks have generally been smoother than in years past.

Since 1984, the Perkins Act has provided federal support to state and local career and technical education (CTE) programs.

House Passes Bill to Strengthen Career and Technical Education. The House this week passed legislation that reforms and reauthorized the Carl D. Perkins Act. The Strengthening Career and Technical Education for the 21st Century Act (Perkins) reflects an increase of $15.6 million over fiscal year 2016 funding. Since 1984, the Perkins Act has provided federal support to state and local career and technical education (CTE) programs. However, because federal law has not been updated in more than a decade, it no longer reflects the realities and challenges facing students and workers. The bipartisan legislation is designed to deliver states more flexibility to use federal resources in response to changing education and economic needs as well as enhance enhance technical education through increased focus on employability skills, work-based learning opportunities, and meaningful credentialing so students are prepared to enter the workforce poised for success.

VA Employee Accountability Bill Passes the House. The House this week passed legislation under which the Veterans Affairs Department would be permitted to fire or demote any employee upon findings of poor performance or misconduct.The White House “strongly supported” other provisions in the bill that aligns with its proposal to change appeals process for veterans’ initial benefits claim decisions. By restructuring process, the measure would ensure that veterans receive the benefits they have earned and are not subject to years of endless waiting and duplicative processes.

Lawmakers Investigating Tax Incentives for Solar Companies. The chairmen of the House and Senate tax-writing committees asked seven large solar energy companies for information about their use of a federal program that has given away billions to renewable energy developers. The letters come amid an investigation by Treasury's inspector general into a number of recipients of benefits under the so-called Section 1603 program, an American Recovery and Reinvestment Act program, that has allowed owners of commercial solar systems and other qualified renewable energy projects to receive a grant equal to 30 percent of the cost of an eligible project instead of an investment tax credit. The credit is available for certain solar projects that began construction between 2009 and 2011 and are placed in service prior to January 2017. The recipient of the two largest cash grants is a European company currently in bankruptcy. Lawmakers worry that business model established by the program created an incentive to sign as many leases as possible without regard to the long-term value or creditworthiness, the aide said, likening the situation to incentives behind the mortgage bubble.

Tied Up. With a few Senate seats likely to flip from one party to the other in this year›s elections, one result is distinctly possible: a tie of 50-50. If you were paying attention in your middle school government or civics class, you would know that a 50-50 split in the Senate is broken by a vote of the president of the Senate, who happens to be the vice president. An evenly divided Senate has only occurred three times in history—in 1881, 1954 and again in 2001. The chance of a 50-50 tie this year is not remote—maybe 25 percent—and it underscores how closely divided the Senate will remain next year.

Administration Update

Estate Tax Regulations. In August, the IRS proposed regulations that could have a significant impact on wealth transfer events. The proposal will eliminate most discounts on transfers of entity interests (including family limited partnerships, corporations and LLCs). The IRS currently is collecting public comments on the proposal and subsequently will hold a public hearing on December 1. The clock continues to tick on this and other regulatory priorities of the Obama Administration, and extensive public comments and a public hearing will make it challenging for the IRS to finalize the rule before the end of the administration. We believe that this regulation will be finalized by Obama, but a Clinton victory in November may give the IRS some breathing room to finalize it after January 20. A Trump victory would likely result in a reversal of this and many other regulations advanced by Obama this year.

Out of Pocket Health Expenses. Currently, Americans can deduct medical expenses which exceed 7.5 percent of their income for a given year. Starting next year, a provision of Obamacare raises that threshold to 10 percent. The House passed the “Halt Tax Increases on the Middle Class and Seniors Act” this week to prevent this increase on out-of-pocket medical expenses from going into place. It has been cited that 10 million Americans use this deduction, including seniors, which is why AARP has endorsed this measure. Republicans are pushing hard on this legislation, but we don’t expect it to advance in the Senate. This is another Obamacare issue that will provide Republicans fodder for the campaign trail. Gridlock and a lack of 60 votes in the Senate will prevent this bill and other Obamacare changes that Republicans would like to advance this year.

Industry News

Potable Reuse of Recycled Water May Be on Tap in California. Californians may be drinking highly treated recycled wastewater sometime in the future, but more information is needed before regulations can be developed, state officials said. The finding comes in a draft report summarizing a State Water Resources Control Board investigation into whether uniform standards can be developed to safely add recycled water directly to a public water supply system or into raw supply immediately upstream of a water treatment plant. It includes recommendations of a panel of scientists and an advisory group. Direct potable reuse of recycled water is part of the state's multifaceted initiative to boost water reuse that includes indirect potable reuse through groundwater recharge, surface water augmentation, stormwater capture and desalination, Marcus said. In addition to being in the midst of an historic drought, California also expects to add some 12 million people by 2049, the report said. There are currently no federal or statewide regulations governing the direct potable reuse of recycled water.

University of Washington Medical Center officials say a second person linked to an outbreak of Legionnaires’ disease has died.

Ice Machine, Sinks Linked To Legionnaires’ Cases at UW Medical Center. University of Washington Medical Center officials say a second person linked to an outbreak of Legionnaires’ disease has died. An ice machine and two sinks in cardiac units of the hospital’s Cascade Tower were found to be contaminated with the germs that can cause the potentially deadly form of pneumonia, officials said this week. Signs warning patients, family and staff not to use drinking fountains and sinks were posted  throughout the tower. The Legionnaires’ cases come more than a year after UWMC was cited by the state Department of Labor & Industries for violations that included detection of low levels of Legionella bacteria in a hospital cooling tower, a specialized device that helps heat and cool buildings year round. Legionnaires’ disease is reported in about 5,000 people a year in the U.S., according to the Centers for Disease Control and Prevention. In Washington state, the number of cases varies each year from fewer than 10 to more than 50. In 2014, 63 cases of Legionnaires’ disease were reported, including eight deaths, according to the state health department.

This Week is SepticSmart Week! This week, the EPA - in conjunction with federal, state and local government and private sector partners - will kick off its fourth annual SepticSmart Week (Sept. 19-23) to encourage American homeowners and communities to properly maintain their septic systems. More than 26 million homes in the United States - or one in five households - depend on septic systems to treat wastewater. If not maintained, failing septic systems can contaminate groundwater and harm the environment by releasing bacteria, viruses, and household toxics to local waterways. Proper septic system maintenance protects public health and the environment and saves the homeowner money through avoided costly repairs. EPA's SepticSmart Program educates homeowners about proper septic system care and maintenance all year long. For information on SepticSmart Week, visit

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