LB 2007 - 1
January 15, 2007

TO: CAWV MEMBERS

FROM: MIKE CLOWSER

RE: 2007 CAWV LEGISLATIVE BULLETINS

Starting today, and running through the 60-day legislative session, members will receive the CAWV Legislative Bulletin every Monday morning. The bulletin contains legislation and activities that will affect contractors, subcontractors and suppliers.

Members will be asked to contact their legislators on issues affecting the construction industry. Members will receive during the session Legislative Alerts detailing the issues and containing contact information. A list of new House and Senate members with their contact information and committees is included in this week's Legislative Bulletin.

This bulletin contains bills that were introduced last week which impact our industry. If you have any questions or need further information, please contact me at mclowser@cawv.org.

WV LEGISLATURE CONVENES

The 2007 session of the WV Legislature convened Wednesday with Gov. Joe Manchin presenting his State of the State address. He listed tax initiatives, workforce skills, safety in industry and schools, technology and teacher and public employee compensation as his goals for this year's legislative session. Gov. Manchin's FY08 budget is $4.1 billion and includes nearly $80 million in pay raises and one-time salary boosts. The governor also wants lawmakers to set aside $117.5 million for the state's "Rainy Day" reserve fund, and to reserve $39.6 million to prepare for a projected Medicaid revenue shortfall in fiscal year 2010. He also is looking at a plan to sell off West Virginia's rights to future tobacco settlement payments if doing so can raise a minimum of $700 million. Next year's budget anticipates a $117 million surplus.

Gov. Manchin touched on a few issues that will impact the construction industry but funding for highways was not a major topic of discussion. The proposed budget does contemplate moving $5.5 million for state police patrol and $4.5 million for Public Service Commission for weight enforcement out of the WVDOH's budget. This frees up $10 million for highways. The CAWV has been proposing eliminating these funding diversions, along with other diversions such as the state's courtesy patrol and industrial access roads. Gov. Manchin also noted that the recent Abandoned Mine Lands (AML) reauthorization bill will provide $987 million in AML reclamation funds over the next 15 years. He proposes to expedite construction of 38 water projects worth $58 million by the year 2010.

The governor said he has directed the Commissioner of Labor to hire additional inspectors to focus on stamping out the use of undocumented and illegal workers in West Virginia. "So, if you're a company that currently utilizes these types of workers, or if you are paying your employees under the table, be on notice that you need to quickly come into compliance, because we are determined to make sure every business and every employee in West Virginia is competing on a fair and level playing field," he stated.

SENATE TRANSPORTATION COMMITTEE TO DISCUSS ROAD FUND TUESDAY, JAN. 16

Transportation Secretary Paul Mattox and CAWV Executive Director Mike Clowser are on the agenda for the Tuesday, January 16, Senate Transportation and Infrastructure Committee meeting at 10:00 AM. The secretary will discuss problems in the State Road Fund and discuss possible solutions. Clowser will discuss proposals that the WVDOH and industry have developed. The meeting will be in the Senate Finance Committee room 451M. All members are invited and encouraged to attend.

BILLS OF INTEREST TO APPEAR IN LEGISLATIVE BULLETIN

Over the next 60 days, the CAWV Legislative Bulletin will detail specific legislative proposals of interest to the construction industry and the business community. It will also present the association's position on various issues. Members will be encouraged to contact their senators and delegates expressing their opinions, both pro and con, on specific pieces of legislation.

House and Senate bills can be accessed from the CAWV's home page at www.cawv.org. Members can view each day's proceedings to see what legislation is introduced that affects the construction industry. A summary of each week's activities will be uploaded on Monday morning.

UNDOCUMENTED WORKERS BILL INTRODUCED FOR SECOND TIME

S.B. 70, introduced by Sens. Bowman and McKenzie and Kessler, amends the state Contractors Licensing Board law to allow the board to fine and suspend contractors if they, or their subcontractors, hire illegal alien workers or other unauthorized workers. The first offense is a fine of $100 to $1,000 and the contractor or subcontractor would have to cease all operations at the work site where the violation occurred. The second and third offenses result in a suspension of the contractor's license. The fourth offense would result in at least a year suspension or permanent revocation of the license. The bill notes "A contractor's purposeful or willful ignorance of the actions and employee status of a subcontractor's employees and workers is not a valid defense to violations under this section or section three, article one-b of this chapter."

This bill was introduced last year and the CAWV worked on an amendment that would make a contractor responsible for the subcontractors he hires but not for sub-subcontractors. This amendment did not make it into the bill. The original bill would have given the Commissioner of the Division of Labor authority to issue a cease and desist order on every project the contractor had ongoing. In this year's version, only the project where a violation exists could be shut down. The CAWV has noted last year that contractors currently are responsible for documenting their workers under other sections of state code. Governor Manchin, in his State of the State address, noted he is giving the Division of Labor additional funding to address illegal immigration issues. How that action differs from this bill was not clear at press time. The bill is referred to the Judiciary Committee.

PRIVILEGE TAX CREDIT PROPOSED

Also, in his State of the State address Wednesday, Gov. Manchin proposed a tax credit for people who move to West Virginia and pay the 5 percent privilege tax on their vehicles. Many border counties have complained that new residents to West Virginia continue to drive on out of state license plates, causing counties to lose the revenue that would be generated from the vehicles being on the tax rolls. The Tax Modernization Committee and a legislative interim committee both reviewed this issue. The governor is proposing the tax credit for people who switch their registration from their previous residence to West Virginia, similar to the existing credit for taxes paid in another state. A few counties have come out opposed this idea. They want the privilege tax waived completely. This action is estimated to cost the WV Division of Highways between $5 and $6 million. A January 14 editorial in The Martinsburg Journal is available by clicking here.

BUDGET ITEMS IMPACT CONSTRUCTION PROGRAMS

Gov. Manchin has included a number of items in his proposed budget that will have a positive impact on construction projects. He has moved from the WV DOH's budget a $5.5 million line item for state police to patrol the interstate highways and a $4.5 million line item for the Public Service Commission to perform weight enforcement duties. These are two of many programs that are funded by the highway program that divert highway funds for non-highway purposes. This will free up $10 million in this year's DOH budget. The administration is continuing to review other diversions such as the courtesy patrol ($4.5 million) and the state's consumer sales tax applied to all highway construction projects (approximately $10 million).

Water projects will get a boost due to Congress passing legislation to extend the Abandoned Mine Land (AML) program. West Virginia will receive $986 million over the next 15 years for AML and water projects. Gov. Manchin says he plans to expedite the completion of 38 drinking water systems totaling $75 million for communities affected by mining operations. The governor plans to use $58 million from AML funds and the rest will be provided by other sources. He hopes the projects will be completed within three years. (See the January 19 CAWV Municipal Utilities Bulletin for a listing of the 38 projects).

PUBLIC-PRIVATE HIGHWAY BILL TOUTED BY TRANSPORTATION SECRETARY

Transportation Secretary Paul Mattox and his key staff meet with association and industry representatives last week to discuss legislation to create public-private partnerships to build and operate highway and bridge projects. In today's Charleston Daily Mail, Secretary Mattox stated, "Using private money as a revenue source could be a great opportunity." Mattox said road projects that could benefit from the partnerships include Corridor H in the Eastern Panhandle and U.S. 35 in Putnam County. Bills have been introduced in the past but have not passed in both the House and the Senate. The CAWV has supported the concept of public-private partnerships provided they bring new investment to the state. Already, 23 states have adopted legislation enabling such efforts.

PLUMBERS AND FIRE PROTECTION LICENSING TO BE PROPOSED

Legislation is expected to be introduced to require state licensing of plumbers and fire protection workers. A bill was introduced a few years ago requiring licensing, much like what is required of electricians. One concern a few years ago was who had jurisdiction over the work being performed. Many of these issues appear to be resolved and a bill should be available soon for review.

Below is a list of bills that have been introduced this week that have an impact on the construction industry or some CAWV members. Anyone needing further information can contact Mike Clowser at (304) 342-1166 or email mclowser@cawv.org.

HOUSE BILLS

HB 2044 Del. Marshall-Designating urban mass transportation authorities as transportation coordinating bodies for their service area (FN)-To Roads and Transportation then Government Organization.

HB 2047 Del. Azinger (By Request)-Reducing the term of Public Service Commission members from six to three years-To Judiciary

HB 2049 Del. Overington-Exempting public works projects receiving federal assistance and subject to federal labor standards from the state prevailing wage laws-To Industry and Labor, Economic Development and Small Business then Judiciary then Finance.

HB 2055 Del. Spencer-Providing an exemption of ten thousand dollars of the evaluation of motor vehicles for personal taxation purposes (FN)-To Judiciary then Finance

HB 2057 Del Frederick-Reducing the corporation net income tax (FN)-To Finance

HB 2091 Del. Perry-Exempting nonprofit organizations fro paying an annual motor vehicle registration fee (FN)-To Finance

HB 2101 Del. Spencer-Reducing the federal adjusted gross income for motor fuel expenses incurred in commuting to and from one's occupation (FN)-To Finance

HB 2106 Del. Frederick-Creating the West Virginia Transportation Oversight Commission-To Government Organization then Finance

HB 2107 Del. Caputo-Promoting contributions to the maintenance and improvement of state parks (FN)-To Finance

HB 2132 Del. Stemple-Contacts to allow the payment of capitol costs of expansions or new construction of public utility facilities in exchange for reservations of capacity in these new facilities-To Government Organization

HB 2145 Del. Yost-Defining Limits use residence elevators in public places-To Government Organization

HB 2150 Del. Browning-Relating to exemptions from workers' compensation and surveyor licensing requirements for certain surveyors-To Industry and Labor, Economic Development and Small Business then Judiciary

SENATE BILLS

SB 19 Sen. Jenkins - Requiring jobs impact statement for certain proposed legislation- To Economic Development then Judiciary.

SB 59 Sen. Prezioso - Relating to basic universal design features for certain dwellings-To Health and Human Resources then Finance.

SB 64 Sen. Jenkins - Expanding Route 2 and Interstate 68 Authority territory-To Transportation and Infrastructure then Government Organization.

SCR 5 Sen. Helmick- Requesting Joint Committee on Government and Finance study state and local tax structure

SB 70 Sen. McKenzie-Providing penalties for employing unauthorized workers-To Judiciary

SB 71 Sen. Bowman, McKenzie and Kessler-Prohibiting new state residents from operating certain motor vehicles not licensed in this state-To Judiciary

SB 77 Sen. White, Bailey, Hunter, Kessler and Wells-Authorizing Attorney General to investigate and charge fuel price gouging-To Judiciary then Finance