WI Legislation

AFS GOVERNMENT AFFAIRS UPDATE – September 26, 2016

This Week in Congress

The House and Senate are back in session this week. Once again, Congress is racing the clock to strike a deal to keep the government open beyond midnight on Friday, September 30. The Senate will continue to work on a spending bill which will fund the government at fiscal year 2016 (FY16) levels through Dec. 9. The Majority Leader’s bill includes bipartisan provisions that have long been part of Continuing Resolution (CR) discussions, such as the $1.1 billion in funding for Zika virus eradication efforts, $37 million for opioid abuse assistance, and $500 million in emergency assistance for communities affected by flooding and other natural disasters. The Leader’s bill does not include emergency funding for communities facing drinking water contamination issues which Democrats’ are demanding. Once Congress finishes work on a spending bill, lawmakers are expected to leave town and not return until after the November elections.

The House is expected to take up the Water Resources Development Act of 2016. The Senate passed their version last week, which includes language to pay for grants to be used to clean the lead contamination in the drinking water in Flint, Michigan and other states. The House WRDA bill does not include funding for drinking water and wastewater infrastructure or for emergency aid for the lead-contaminated drinking water crisis in Flint, MI.

Save the Date - June 20-21, 2017 – AFS Government Affairs Conference

Mark your calendars for AFS’ 2017 Government Affairs Conference in Washington, D.C. - June 2021, 2017 – at the Hyatt Regency on Capitol Hill. In November, you will head to the polls, along with the voters, to help elect the nation’s 115^th Congress and 45th President. The Conference is a great opportunity to introduce the new Congress and Administration to the metalcasting industry. We will head up to Capitol Hill to educate lawmakers about out top policy issues affecting your company and our industry!

DC Court to Hear Arguments over EPA Clean Power Plan on Sept. 27

A panel of ten judges from the Court of Appeals for the District of Columbia Circuit will hear oral arguments on Tuesday, September 27 on the Obama administration's landmark Clean Power Plan (CPP). The Environmental Protection Agency's (EPA) CPP rule mandates a 32 percent cut in the power sector's carbon dioxide emissions by 2030. It serves as the centerpiece of the administration’s efforts to cut greenhouse-gas emissions. Given the importance of the case, nearly 160 petitioners have challenged the rule, making it perhaps the largest coalition of petitioners in a regulatory challenge in recent memory. The coalition includes 27 states, 25 trade associations, including the American Foundry Society (AFS), 71 utilities, 10 mining companies, and 8 labor unions.

A total of 16 advocates have a total of 218 minutes to argue the case for both sides. Conservative states, energy companies and business interests will be arguing that numerous aspects of the rule violate the Clean Air Act, the Constitution or the rights of the states and businesses. The Justice Department, assisted by environmental groups, and some states will argue that the rule fits squarely within the EPA's authority. The D.C. Circuit’s decision is unlikely to come before a new

president is elected Nov. 8. All sides agree that the Clean Power Plan is destined to be considered by the Supreme Court.

Proposed Silica Litigation Timeline Submitted to DC Circuit Court

In August, the attorneys for the various stakeholder groups involved in the Occupational Safety and Health Administration’s (OSHA) crystalline silica rule litigation discussed a potential format and schedule in order to proceed forward. The various parties (U.S. Department of Labor, organized labor, and industry/construction groups) agreed to following schedule which was formally submitted to the D.C. Circuit Court of Appeals on September 9, 2016. We are awaiting a response from the Court if they will accept the timetable set forth.

Industry Groups and States File Suit Challenging New DOL Overtime Rule

A group of 21 states and over 55 business groups filed suit challenging the U.S. Department of Labor’s (DOL) new overtime exemption rule on Tuesday, September 20, 2016, arguing the agency unconstitutionally overstepped its authority to establish a federal minimum salary level for white collar workers.

The rule, set to take effect on Dec. 1, would require employers, including foundries, to pay overtime to any salaried worker earning less than $47,500 a year, double the current threshold of $23,660. Future automatic increases to the salary threshold will occur every three years, beginning on Jan. 1, 2020.

The states challenging the lawsuit include Alabama, Arizona, Arkansas, Georgia, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Michigan, Mississippi, Nebraska, Nevada, New Mexico, Ohio, Oklahoma, South Carolina, Texas, Utah and Wisconsin. We expect continuing legislative efforts to defund, block or nullify the rule in Congress.

For compliance information on the DOL’s final rule updating the overtime regulations, go to: https://www.dol.gov/whd/overtime/final2016/

IRS Proposes Significant Changes to Estate and Gift Tax Rules – AFS Seeking Member Input on Impact of Rulemaking

In August, the U.S. Treasury Department released a set of proposed regulations making changes to Section 2704 of the estate and gift tax valuation discounts. The proposal would impose significant new tax costs on family-owned businesses, making it harder for family owned and operated businesses to transition to the next generation.

AFS is working with the Family Business Estate Tax Coalition (FBETC) and the National Association of Manufacturers (NAM) on this issue. AFS recently signed onto a coalition letter with over 100 organizations to the Dept. of Treasury, Secretary Jack Lew, urging the withdrawal of new estate tax regulations, which was sent out on Sept. 26.

In order to understand how the new proposed rule will impact our small, family owned foundries and suppliers, we are seeking input on the following:

Background on your company - how long has your business been open, who founded it, how many employees do you have, where do you operate?
How does your succession plan use valuation discounts to help pass on the business? If your business has already survived one generation, were valuation discounts useful in that transfer?
How will the proposed rule affect your succession plan and the transfer of your business?
If the rule change increases your estate tax liability, what will that do to your employees? Reduction in workforce, benefits, or wages? Slower future growth?
Could this change potentially cause the liquidation of the business to pay estate or gift taxes?

Please forward your comments on how the new IRS proposal will impact your business to ssalmon@afsinc.org We will share this information with key lawmakers and their staff. A public hearing on these proposed regulations has been scheduled for December 1, 2016, beginning at 10 a.m. in the Auditorium, Internal Revenue Building, 1111 Constitution Avenue, NW, Washington, D.C. 20224. Comments are due on the proposed rule by Nov. 1.

Senate Passage of Water Resources Development Act Contains AFS Supported Water Infrastructure Provisions

On September 15, 2016, the Senate approved the Water Resources Development Act (WRDA) of 2016 (S. 2848), by an overwhelmingly bipartisan vote of 95 to 3. The $10.6 billion bill would authorize projects to be carried out by the U.S. Army Corps of Engineers (USACE) to increase port capacity, improve coastal and inland navigation, as well as hurricane mitigation and ecosystem restoration.

The underlying bill authorizes $4.5 billion worth of water-related infrastructure projects around the country and authorizes $4.9 billion over five years to repair systems related to drinking water. Specifically, the legislation would direct $220 million to assist Flint and other communities in upgrading drinking water technologies and infrastructure. The legislation would also create a water infrastructure fund and provide financial assistance for drinking water and waste water systems contamination testing and lead poisoning monitoring programs.

AFS specifically supported the “Buy American” provision in WRDA bill for EPA’s state revolving fund (SRF) for drinking water. The bill also capitalizes the Water Infrastructure Finance and Innovation Act (WIFIA) program with credit subsidies that should deliver at least $700 million worth of low-interest water and wastewater infrastructure loans to cities and towns nationwide.

House Approves AFS Endorsed Technical Education Reauthorization Bill

The U.S. House of Representatives approved AFS-supported bipartisan legislation on Tuesday, September 13, by a vote of 405 to 5. The bill, the Strengthening Career and Technical Education for the 21^st Century Act (H.R. 5587), also known as Perkins Act, reauthorizes the primary federal legislative investment in Career Technical Education (CTE).

Key provisions of interest for AFS include: integrating industry-recognized credentials; expanding support for dual- or concurrent-enrollment programming, such as early college high schools that provide students with the opportunity to receive postsecondary credit while in high school; authorizing innovation grants to improve CTE; and, increase support for work-based learning activities through innovation grants and state leadership activities.

AFS signed onto a coalition letter with nearly 500 companies and associations urging lawmakers to support the measure. The Senate Health, Education, Labor and Pensions Committee continues to work toward its own bipartisan Perkins reauthorization bill.

For additional information, contact, Stephanie Salmon, American Foundry Society –
Washington Office, 202/452-7135 or ssalmon@afsinc.org

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