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  1. 2019 LEGISLATIVE ISSUES OVERVIEW PRESENTED BY Cecile Conroy Director of Government Affairs

  2. Legislative Issues - 2019 • Energy • Health Care • Pension and Retirement Security • Labor Reform • Trade

  3. Energy and Climate Policy (aka Jobs, Jobs, Jobs!) • The Carbon Capture Modernization Act • In 2005, Congress established an investment tax credit, known as Section 48A to support advanced coal-based technology and incentivize the construction of new, highly efficient coal units. More efficient units = reduced pollution. • In 2008, Congress amended Section48A with additional tax credits with a new requirement to capture and store at least 65% of a unit’s CO2 in order to be eligible for the additional credits.

  4. Energy and Climate Policy • Unfortunately, the 2008 CCS language wasn’t thought through in relation to the 2005 efficiency language. • Adding CCS equipment to a new or existing unit results in an efficiency loss to the generating unit, due to the additional power required to run the CCS component. • It is impossible to achieve the 2005 efficiency requirements while operating CCS equipment. • Language to update the discrepancies between the 2005 and 2008 legislation is necessary in order to allow new and retrofit projects to take advantage of the CCS tax incentives that Congress approved 10 years ago.

  5. Energy and Climate Policy • Coupled with the 45Q CCUS expanded tax credits of 2018, an amended 48A would offer a strong incentive for utilities to invest in CCS/CCUS to advance these critically needed technologies. • Legislation introduced this year to make this much-needed technical correction: • S. 407 • H.R. 1796

  6. Energy and Climate Policy • The Utilizing Significant Emissions with Innovative Technologies (USE IT) Act, which further facilitates the development of carbon capture technologies. • Clarifies that CCUS projects and CO2 pipelines are eligible for a streamlined permitting review process under the Fixing America’s Surface Transportation Act, designed to improve the timeliness, predictability, and transparency of the Federal environmental review and authorization process for covered infrastructure projects.

  7. Energy and Climate Policy • Requires guidance to assist project developers in planning, siting and permitting of pipeline infrastructure to transport CO2 captured from industrial and power generation. • Task force established to identify permitting and other challenges for CCUS and CO2 pipeline project developers. • Directs support for Research and Development of CCUS and Direct Air Capture (DAC) technologies. • Builds on the crucial reforms to the Section 45Q tax credit for CCUS that passed in 2018.

  8. Energy and Climate Policy • Legislation introduced this year in both House and Senate with bi-partisan support. • S. 383 • H.R. 1166 • Ongoing discussions to include the USE IT Act on the upcoming National Defense Authorization Act (will be going to conference committe between House & Senate after the August recess.)

  9. Energy and Climate Policy • Need for Increased DOE Funding • Existing Fleet: Need to improve the efficiency, reliability, and flexible operations of the existing fleet so it can continue to provide affordable, resilient and reliable electricity. • Today’s Available Technology: Need to demonstrate and deploy new and improved fossil fueled generating plants necessary to maintain fuel diversity, industry supply chains, and ensure energy security in the future • New, Transformational Technology: Federal RD&D in new technologies will ensure fuel diversity and position the U.S. to accelerate development of technology options that can compete with other generation on basis of cost and CO2 emissions performance.

  10. Energy and Climate Policy • Enhancing Fossil Fuel Energy Carbon Technology (EFFECT) Act of 2019 (S. 1201).  • Authorizes a comprehensive research, development, and demonstration program for several technologies resulting in the deployment of fossil fuel generating technologies that will be cost competitive with other forms of low carbon generation. • Supports R&D for carbon utilization and carbon removal, and would direct the Department of Energy to study the viability of long-term stabilization support contracts – would be extremely valuable in demonstrating and financing commercial scale carbon capture projects.

  11. Energy and Climate Policy • Fossil Energy Research and Development Act of 2019 (H.R. 3607). • Authorizes a new research, development and demonstration program at the Department of Energy (DOE) that would accelerate deployment of carbon capture, utilization, and storage and transformational advanced power cycles for coal and natural gas applications. • Also encourages federal support of large-scale pilot and commercial demonstration testing, which is critical for private sector adoption of these new technologies.

  12. Energy and Climate Policy • What about the Green New Deal? • Non-binding resolution offered in the House and Senate. Aspirational only. • Labor was not consulted on this prior to release. • No “votes” in either House or Senate • Legislators generally looking for more practical solutions to address climate change. • Good talking points for some politicians but has not been widely embraced on the Hill.

  13. Energy and Climate Policy • Other miscellaneous “climate” legislation introduced: • Zero emission vehicles • Renewable Portfolio Standards • Carbon Tax variations • Most are messaging bills and likely to not move, especially in the Senate.

  14. Energy and Climate Policy • Revisiting the FUTURE Act, aka 45Q, passed in 2018. • Incentives CCUS with a price on carbon for storage and for beneficial use. • Probably most attractive in the Enhanced Oil Recovery sector, at least right now. • IRS has final proposed the rules of the road on how industries may claim the credits, etc. • Should be a niche area for Boilermakers and contractors to keep an eye on for potential CCUS projects.

  15. Energy and Climate Policy • Status of Clean Power Plan litigation: • EPA submitted replacement rule in June, the Affordable Clean Energy Rule. • Energy-related unions worked closely with EPA to craft a rule that was reasonable and legal within the framework of the Clean Air Act. • As litigants against the CPP, IBB recently joined with IBEW, UMWA and others on a motion to dismiss all litigation on the CPP now that EPA has published its replacement rule. • Litigation likely to continue…

  16. Health Care Taxes • The Middle Class Health Benefits Tax Repeal Act of 2019 • The Infamous Cadillac Tax!!! • H.R. 748 passed the House overwhelmingly on July 17th, after a long 10-year battle. 419-6. • Fate of S. 684 in the Senate uncertain, despite having 42 bipartisan co-sponsors. • Full court press up next to get the bill passed in the Senate.

  17. Miscellaneous • New Healthcare bills in the news: • Medicare at 50 Act: would expand Medicare by allowing individuals ages 50–64 to “buy in” to the program. Enrollees would be able to purchase coverage on the marketplace using ACA tax credits and cost-sharing subsidies, with premiums calculated to prevent financial risk to the existing Medicare program. • Medicare X: would leave the existing health care system intact, but would create a public option for Medicare, allowing individuals of any age to purchase plans that would include access to the program's network of health care providers and the ACA’s range of benefits, like maternity care and mental health services.

  18. Miscellaneous • New Healthcare bills in the news: • Medicare for All Act of 2019: would create a universal Medicare program that covers all American residents in one government-run health plan. It would bar employers from offering separate plans that compete with this new, government-run option. It would sunset Medicare and Medicaid, transitioning their enrollees into the new universal plan. • Those who do qualify for the new universal Medicare plan would transition into the program over the course of two years. This would start with people under 19 and over 55 moving into the program one year after it became law — and everyone else one year after that.

  19. Miscellaneous • New Healthcare bills in the news: • The Boilermakers have NOT taken a position on any of these new healthcare bills. • Will likely see additional, similar bills proposed (Medicare for America Act of 2018, for example) along with a variety of bills addressed at lowering drug prices. We will monitor all as they get introduced. • Trump Administration backs a full invalidation of the Affordable Care Act. Texas v. Azar oral hearings held on July 9th. Probably will go to the Supreme Court. • No Republican ACA “Repeal and Replace” legislation underway.

  20. Pension and Retirement Security • The Rehabilitation for Multiemployer Pensions Act • There has been a growing pension crisis in the U.S., particularly in the aftermath of the 2008 Great Recession. Many pensions, both single employer and multiemployer, have been able to financially recover. However, a portion have not due to several situations: employer withdrawal, employer bankruptcies, retiree/active ratio, etc. • Congress needs to act this year!

  21. Pension and Retirement Security • The Rehabilitation for Multiemployer Pensions Act • Focus on financially troubled multiemployer pension plans that are considered to be in “critical and declining” condition. • Legislation would offer financial support to these pension plans so they do not fail. • Creates the Pension Rehabilitation Administration (PRA) within the Department of Treasury. • Gives these pension plans time to financially recover.

  22. Pension and Retirement Security • The Rehabilitation for Multiemployer Pensions Act • The PRA would sell Treasury-issued bonds in the open market. • Proceeds of the sale of the Treasury bonds would be used to lend money to these financially troubled plans. • Term of 30 years at low interest rates, around 3 percent.

  23. Pension and Retirement Security • The Rehabilitation for Multiemployer Pensions Act • The PRA loan funds must be invested separately to match the pension payments for retirees. • Allows plans to continue paying retirees while also shoring up remaining assets and all future contributions to protect benefits for active workers. • Does not permit any pension plan who receives a PRA loan to cut retiree benefits. Under current law, failing plans may apply to the Department of Treasury to cut current retiree benefits.

  24. Pension and Retirement Security • The Rehabilitation for Multiemployer Pensions Act • By permitting troubled plans to access a 30-year loan instead of cutting benefits and declaring insolvency, this program will also help ensure that the Pension Benefit Guaranty Corporation (PBGC) would not be in danger of becoming insolvent with the weight of plans who, right now, might be forced to turn to the PBGC solely to pay pension benefits at a severely lower level. • PBGC-only benefits would result in a sizable cut to retiree pension payments. The PRA loan proposal aims to avoid that dire situation.

  25. Pension and Retirement Security • H.R. 397 - the Rehabilitation for Multiemployer Pensions Act • We need a Senate companion bill. • 207 cosponsors in the House. • Possible vote in the House this week (today?).

  26. Pension and Retirement Security • The Joint Select Committee on Solvency of Multiemployer Pension Plans (MEP): • Was established in March 2018. • Mandated to develop proposals to address the “critical and declining” plans in the MEP system by November, 2018. • Bi-partisan committee failed to come to any agreement on legislation or recommendations. • Dissolved with no further action to date.

  27. Labor Reform • Protect the Right to Organize (PRO) Act, H.R. 2474 and S. 1306 • Would modernize the NLRA by bringing its remedies in line with other workplace laws. • In addition to imposing financial penalties on companies and individual corporate officers who violate the law, the bill would give workers the option of bringing our case to federal court. • Would make elections fairer by prohibiting employers from requiring their employees to attend “captive audience” meetings whose sole purpose is to convince workers to vote against the union. • Once workers vote to form a union, the National Labor Relations Board (NLRB) would be authorized to order that the employer commence bargaining a first contract.

  28. Labor Reform • Would ensure that employees are not deprived of the right to a union because an employer deliberately misclassifies us as supervisors or independent contractors. • Would establish a process for mediation and arbitration to help the parties achieve a first contract.Protects the integrity of union elections against coercive captive audience meetings. • Protects employees’ right to strike by preventing employers from hiring permanent replacement workers. • Allows unrepresented employees to engage in collective action or class action lawsuits to enforce basic workplace rights, rather than being forced to arbitrate such claims alone.No chance of passing under Republican House and Senate. • Would eliminate right to work laws!! • H.R. 2474 - 175 cosponsors so far. • S. 1306 - 40 cosponsors so far.

  29. Trade • United States-Mexico-Canada Agreement (USMCA) – signed but not ratified by all 3 countries. • Mexico recently passed required labor laws per the new agreement, however… • Labor has NOT supported this deal as of yet. • NO VOTE until Mexico can prove that it has the infrastructure and resources to eliminate nearly a million protection contracts and raise wages and standards through REAL unions.  • NO VOTE until the new NAFTA has a dispute settlement process that can’t be blocked by one of the parties.  • NO VOTE until workers have a way to enforce this agreement, including the right to stop goods at the border that were produced in violation of the labor chapter.

  30. Political Landscape • 2019 State Elections: • Gubernatorial races in Kentucky, Louisiana, Mississippi. • State legislative races in Louisiana, Mississippi, Virginia and New Jersey General Assembly. • 2020 Presidential race is off and running! • 25 confirmed Democratic candidates, so far… • William Weld, former Governor of Massachusetts, is running against Trump in Republican primaries.

  31. Questions?

  32. Thank you. Cecile Conroy International Brotherhood of Boilermakers