NASBP Focal Point - April 8, 2021

Legislative News at a Glance

Thirty-nine state legislatures, DC, and U.S. Congress are currently in session: Alabama, Alaska, Arizona, California, Colorado, Connecticut, Delaware, District of Columbia, Federal, Florida, Hawaii, Illinois, Iowa, Kansas, Maine, Maryland, Massachusetts, Michigan, Minnesota, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, Tennessee, Texas, Utah, Vermont, Washington, West Virginia, and Wisconsin.

Territories: American Samoa, Guam, Northern Mariana Islands, Puerto Rico, and U.S. Virgin Islands.

*Click here for a complete 2021 calendar of the states’ legislative session dates.

In This Issue

Federal Report
Federal Wrap-Up
NASBP/SFAA Virtual Fly-In
State Report
Bond Threshold
Electronic Bonding
Public-Private Partnerships

Federal Report

Federal Wrap-Up

The American Job’s Plan was officially unveiled on March 31, which, according to the Administration, “is an investment in America that will create millions of good jobs, rebuild our country’s infrastructure, and position the United States to out-compete China.” However, battle lines are already being drawn on Capitol Hill over the President’s jobs/infrastructure bill. Republicans claim the plan is not a true infrastructure spending bill, while the progressive wing of the Democratic party believe that President’s plan does not go far enough. Even though President Biden has encouraged Republicans to support this bill, Democrats are considering using budget reconciliation like they did to pass the nearly $2 trillion COVID relief bill.

There is also the hot-button issue of how to pay for the President’s plan. While Biden has proposed raising the corporate tax rate from 21% to 28%, business groups, such as the U.S. Chamber of Commerce and members of the President’s own party, such as Senator Manchin, have spoken out in opposition.

Meanwhile, the two Congressional Committees whose responsibilities are to reauthorize a surface transportation bill, which is set to expire on September 30, continue to forge ahead with the goal of advancing legislation out of their respective committees (House Transportation and Infrastructure and the Senate Environment and Public Works Committees) by Memorial Day.

Earlier this week, the Connecticut Construction Industries Association hosted a virtual Infrastructure Summit, which featured Reps. Rosa DeLauro, Chair of the House Appropriations Committee, and Peter DeFazio, Chair of the House Transportation & Infrastructure Committee. Chairman DeFazio referenced the President’s $2.25 trillion infrastructure plan and noted that it includes some of the priorities highlighted in his House bill but also addresses climate change and investing in transit and clean mobility options.

NASBP/SFAA Virtual Fly-in

On March 25, over 100 attendees participated in nearly 140 virtual congressional meetings. Because this was the first time that NASBP/SFAA hosted a virtual fly-in, it was important to survey attendees to rate their experiences. Of those attendees who responded, 80% rated their overall satisfaction as either highly or very satisfied. The virtual fly-in platform also received high marks where 96% viewed the platform as very high or of high quality. When respondents were asked if they would participate in another virtual fly-in, 100% responded yes.

Prime Advocacy, the vendor who secured our congressional meetings and provided the fly-in platform, has recognized the benefits of creating a hybrid approach to congressional fly-ins. When Prime Advocacy surveyed congressional schedulers to gauge their response of a hybrid model: 33% anticipate taking in-person meetings before the end of 2021; 98% expect to have a combination of in-person and virtual meetings in 2022, 21% prefer in-person meetings only in 2022, and 33% prefer virtual meetings only in 2022. Based upon these numbers and the results from our own survey, the hybrid approach certainly is an option to consider for future fly-ins. The hybrid creates greater participation and flexibility, while eliminating travel time and expense. For your reference, please take note of the fly-in message points and a recent letter delivered to the Senate Committee on Commerce, Science and Transportation addressing bonding requirements for rural broadband infrastructure projects.

State Report

Bond Threshold

Oklahoma House Bill 2862

UPDATE (in bold) OK H.2862 (Wallace) Amends Okla. Stat. tit. 61 §§ 1 and 113 by increasing the bond threshold for all public construction contracts from $50,000 to $100,000. Last month, this bill passed the House as well as the Senate Committee on General Government.

Electronic Bonding

New Jersey Comment Letter

Last month, NASBP and The Surety & Fidelity Assocation of America submitted comments on proposed N.J.A.C. 17:19-6.5, which authorizes the State to accept commercial standards for electronic forms of bid security, as provided under Section 8 of the Act (N.J.S.A. 52:34A8). NASBP/SFAA’s comments sought clarification, as the proposed regulation permitted electronic submission of bid bonds but was silent on the acceptance of electronic submission of final bonds. In response to our joint comment letter, DPMC clarified that is was not the Agency’s intention to exclude submission of payment or performance bonds in electronic format. In DPMC’s view, it will accept both performance and payment bonds to be submitted electronically once its procurement system is operational.

Public-Private Partnerships

Maryland Senate Bill 361

UPDATE (in bold) MD S.361/H.485 (Rosapepe/Solomon) Establishes the Public-Private Partnership Oversight Review Board to study and make recommendations regarding certain matters; authorizes the Board to request technical assistance, including an evaluation of the security package provided by the private entity and private funding source including any payment and performance bonds, letters of credit, parent company guarantees, and lender or equity partner guarantees for P3 agreements above $500,000.

The language in this proposed legislation seems at odds with the current law (Md. Code State Fin. & Proc. §§ 10A101 to 401) enacted in 2013, stating that performance and payment bonds must be provided by the private partner in the P3 agreement. This law didn’t address alternate forms of security for P3 agreements, such as letters of credit or parent company guarantees. Last month, the House bill passed the House and was sent to the Senate Committee on Education, Health, and Environmental Affairs as well as the Senate Committee on Budget and Taxation.

*Click here for a state-by-state breakdown of P3 statutes.

If you are aware of any bills impacting the industry, please reach out to Larry LeClair, NASBP’s Director of Government Relations, and let us know.

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The National Association of Surety Bond Producers

www.nasbp.org

Focal Point is an e-bulletin sent to members and friends of the National Association of Surety Bond Producers when most state legislatures are in session and as needed thereafter. To obtain copies of Bills or other materials discussed above, contact advocacy@nasbp.org. Copyright © 2021 NASBP®. All rights reserved.