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Eleven legislatures are currently in session.
They are California, District of Columbia, Federal, Illinois,
Massachusetts, Michigan, New Jersey, New York, Ohio,
Pennsylvania, and Wisconsin.
Wisconsin is currently the only legislature in
special session.
Bonding Assistance
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UPDATE! PA HB 2140 (Wheatley)/HB 2142
(Thomas) HB 2142 was referred to the Committee on Rules on
June 22. This legislation provides for the establishment of the
Surety Bond Guarantee Program; establishes a Surety Bond
Guarantee Fund; and provides for contracts eligible for
guarantee and for participation by disadvantaged businesses so
that they may competitively bid on government contracts.
The bill requires Commonwealth agencies to adopt and institute,
with the Department's assistance, a mentor-protégé program to
assist, support and enable small businesses to successfully
compete for prime and subcontract awards by partnering with
large companies, which shall serve as mentors, in State
contracts. The mentor-protégé arrangement between a prime
contractor and a minority-owned, women-owned, or disadvantaged
subcontractor shall be an important factor to be considered or
weighed by the Commonwealth agency in awarding state contracts.
Bond Threshold Increase
- NC HB 1035 (Glazier) In April 2009, HB
1035 was introduced to increase the performance and payment bond
threshold from $300,000 to $500,000 for construction projects
awarded by the University of North Carolina System that exceed
$500,000 for any one project. It was approved by the House in 2009
and was sent to the Senate where it remained inactive and was
carried over to 2010. Subsequently, the Senate amended the bill so
that the bond threshold increase applied to projects for State
departments and State agencies in addition to the University of
North Carolina and its constituent institutions.
Over the course of the last year, NASBP and its North Carolina
members have actively opposed this bill and reached out to
legislators in an attempt to educate them about the impact of
raising the bond threshold to the highest in the Nation would have
on state taxpayers and subcontractors and suppliers who rely upon
the payment bond protection. The Surety and Fidelity Association of
America (SFAA) and the American Insurance Association (AIA) offered
countless amendments and lobbied key legislators in an attempt to
defeat this bill. Ultimately, the bill passed the Senate 34-13 and
the House, as amended by the Senate, 59 to 50, and was presented to
the Governor for his signature on July 9. HB 1035 goes into effect
on October 1, 2010, and applies to construction contracts awarded on
or after that date.
Privatization
- UPDATE! IL SB 2621 (Risinger)/SB 3482 (Steans)
SB 3482 was referred to Assignments on June 27. It authorizes the
state and its political subdivisions to enter into public private
partnerships (PPP) for the construction of transportation
facilities. However, the bill provides that the PPP would have to
provide for the delivery of performance and payment bonds “in the
connection with the development and/or operation of the qualifying
transportation facility, in the forms and amounts satisfactory to
the responsible entity.”
This language may be problematic, because it appears to extend bond
coverage possibly beyond the construction portion of the project. SB
2621 was assigned to the Executive Subcommittee on State and Local
Governments and re-referred to Assignments. A hearing was scheduled
for February 17, but was subsequently postponed.
- UPDATE! IL SB 3659 (Hutchinson) The bill was
signed by the Governor and deemed a Public Act effective immediately
on June 9. The law creates the Public Private Agreements for the
Illiana Expressway Act that grants the Illinois Department of
Transportation, on behalf of the State, to enter into one or more
public private agreements with one or more private contractors to
develop, finance, construct, manage, or operate the Illiana
Expressway on behalf of the State.
Contractors may receive certain revenues including user fees in
consideration of the payment of moneys to the State for that right.
Performance and payment bonds or other security in a form and amount
satisfactory to the Department are required in all contract offers.
Procurement
- UPDATE! MD HB 359 (James)/SB 171(Peters)
HB359 and SB171 were cross-filed and signed by the Governor on May
20. The act will take effect on October 1, 2010. The law establishes
a minimum goal for certified disabled veteran business enterprises
at .5% for state procurement contracts and requires the Board of
Public Works to adopt regulations establishing prohibited acts and
penalties for violations of this Act.
Miscellaneous
NASBP asked to support Senator Cardin’s Amendment
- On Tuesday, NASBP was contacted by Senator Ben
Cardin’s (D-MD) office asking that we send letters to Senators Reid
(D-NV) and McConnell (R-KY) in support of an amendment Senator
Cardin will offer that will make permanent the changes made to the
SBA Surety Bond Guarantee Program as adopted by the American
Recovery and Reinvestment Act (ARRA). Those changes included among
the following: increasing the contract size guaranteed by the SBA up
to $5 million, and vesting discretion in the Administrator to
determine the Program’s liabilities. For those of you who attended
the NASBP Legislative Fly-in, making the changes permanent to the
SBA Bond Guarantee Program was a top priority issue for Fly-in
participants to discuss during their Congressional visits.
NASBP sent a letter to Senator McConnell and Reid’s office and also
encouraged NASBP members to contact their U.S. Senators and ask that
they support Senator Cardin’s amendment.
NASBP drafted a sample letter, so if you have not already done,
please consider sending a letter in support of the Cardin amendment
as soon as possible. For a copy of the sample letter please click
here. For a list of U.S. Senators and their addresses, please
click
here. Time is of the essences, so please either fax or e-mail
your letters, as the bill and all amendments may be voted on anytime
within the next week.
NASBP meets with Ranking Minority Member of the
House Small Business Committee
- NASBP staff met this week with Representative
Sam Graves (R-MO) and his Legislative Director to personally thank
the Congressman for speaking at the Legislative Fly-in Day in June
and to discuss what issues the House Small Business Committee will
address in the next Congress. Should Republicans gain control of the
House, Representative Graves will likely become Chair of the House
Small Business Committee.
Over the past year or so, NASBP has established a professional
working relationship with Representative Graves’ staff. Among issues
for examination in the next Congress will be contract bundling.
Representative Graves recognizes the need to curtail this practice
and has addressed it by introducing legislation in this Congress
that prohibits the practice of contract bundling for new
construction to allow small construction businesses to compete on
federal procurement projects; similar legislation will likely be
reintroduced in the next Congress.
NASBP Annual Fly-in
- On June 23, nearly 80 NASBP members and
affiliates came to Washington D.C. to show their passion for surety
and make their presence known on Capitol Hill at the 2010 NASBP
Legislative Fly-in Day. The event included a morning briefing and
orientation program with key policymakers such as Senator Ben
Cardin, Congressman Sam Graves, Brandon Neal from the Department of
Transportation’s Office of Small Business Disadvantaged Utilization,
Eric Zarnikow from the U.S. Small Business Administration, and Wally
Hsueh from the U.S. Senate Committee on Small Business and
Entrepreneurship.
After an afternoon of over 50 visits with Congressmen, Senators, and
their staff, the day concluded with an NASBP-hosted reception on
Capitol Hill that was well-attended by Hill staff and NASBP members.
For those of you who attended, thank you for your participation. If
you didn’t get the chance to attend this year, we hope you’ll
consider coming out next year to experience and take part in the
success!
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