House Bill 109, ABC’s legislation that protects Delaware contractors who have disputes with out-of-state contractors over payment or other issues that occur on a construction project, passed the House of Representatives and State Senate during session and now must be signed by Governor Jack Markell to become law. ABC Delaware has been working on this legislation for over a year. Currently, the law allows out-of-state contractors who have a dispute with a Delaware contractor to go to their home state to pursue action. This legislation would prevent this in the future and make it Delaware public policy that all construction disputes be settled in Delaware. This is good news for Delaware construction companies.
ABC members Marc Mancini of Eastern Industrial Services, Jim Betley of County Group Companies, and Dominic Maida of Newark Insulation were instrumental in helping to have House Bill 302, a bill to require licensing of journeyperson and apprentice insulators, tabled twice during session in the Delaware House of Representatives Sunset Committee. All three members testified before the committee on both occasions regarding the negative impact this legislation would have on their businesses. All three companies also brought over 60 employees to the hearing to show support for tabling this legislation.
Governor Jack Markell signed Executive Order 36 during session that would require a review of all state regulations that companies must follow to operate in Delaware. Markell’s Executive Order establishing the reviews are intended to remove paperwork burdens facing Delaware businesses. Executive Order 36 requires executive branch agencies to take a close look at the regulations on their books that have been in place at least three years. It launches a public process to give citizens a chance to tell state agencies which regulations they believe are no longer working. Each executive agency will be required to hold at least one public forum in each county and accept written comments and suggestions. At the conclusion of the public input period, each agency must evaluate the proposals and recommendations it received during the public comment period. In some cases, agencies may decide that a regulation serves a relevant policy purpose, is required by the federal government, or is valid for some other reason. In those cases, the regulation would stay in place. In other cases, the agency can revise and eliminate those regulations, in accordance with the procedures required under the APA, or Administrative Procedures Act. Under the executive order, no later than one year from the orders’ establishment, the Governor’s Office will submit a report to General Assembly detailing the regulations eliminated or modified pursuant to this process.
ABC member Vicki Petrone of Logan and Petrone testified before the Small Business Caucus of the Delaware General Assembly on the impact of the Workplace Fraud Act in the construction industry. Petrone discussed the impact of a provision in the law that does not allow contractors to sub work to other contractors that perform the same type of work. This provision is creating severe consequences for Delaware contractors and subcontractors in the following areas: No ability to subcontract work due to schedule, manpower, job location or economic considerations; and prevents use of MBE (Minority business enterprises)/DBE (disadvantaged business enterprises) for work within contractor’s type of work, even if required by the contract (DelDOT and other state-funded projects).ABC proposed changing the law to match the statutes in Maryland, Pennsylvania and New Jersey. It would modify the definition of "independent contractor” to expressly allow subcontracting to a valid business within its own employees. The legislation stalled in the House.
ABC was added to a School Construction Working Group to evaluate the School Construction Planning Committee and school construction cost data. House Resolution 37 formed by the General Assembly is to evaluate the voluntary school assessment, school construction formulas, and other school construction costs. The group is also asked to evaluate why the cost formula and school assessment currently varies among the counties and municipalities in the state. The Working Group is responsible for providing a joint report on its findings and recommendations to the Governor and General Assembly by January 15, 2013.
ABC worked the past two weeks of session to stop H.B. 405, legislation that would require mandatory apprenticeship programs for all contractors who wanted to work on state funded construction projects. The CM, general contractor or prime contractor would have been responsible for completing a Contractor Responsibility Certification to verify that they participate in an Apprenticeship program for each separate trade in which they employ craftspeople, and also facts regarding there past performance, work history and qualifications. The legislation would have also mandated that they have 20% of the total craft labor work hours on the project performed by women and minority employees.
Two bills that would have delayed the implementation of Electrical licensing for journeyperson and apprentices from July 1, 2012 were defeated. Senate Bill 179, an Act that would have delayed implementation of HB 180 for 2 years was tabled in the Senate Labor Committee. House Bill 301, a bill that would have repealed the licensing requirement was tabled in the House Sunset Committee.
The States capital projects budget passed the General Assembly on June 30, 2012. The bond bill total is $429 million and included an additional $20 million for transportation projects. Here is the breakdown: $120 million for school construction; $193 million for transportation projects; $52.5 million for the Office of Management and Budget; $3.25 million for Delaware State University, $3 million each for University of Delaware and Delaware Tech. The rest of the bond bill went to Corrections, DNREC, Health and Social Services and the Delaware Economic Office. There were two provisions in the epilogue language related to construction: 1) It is the intent of the General Assembly that all public works projects, including all public school projects, that utilize a construction manager on the project, utilize the delivery methodology which requires the construction manager to secure a performance and payment bond for their portion of the work. All subcontractors shall be listed at the start of the project and shall provide a performance and payment bond which names the Construction Manager and the State of Delaware as additional insured. All provisions of 29 Del. C. c. 69 are in effect for projects which utilize Construction Manager. 2) The Department of Transportation is authorized to engage in up to two project procurements (one in New Castle County and one in Kent County) utilizing the craft training and apprentice program called for in 29 Del. C. §6962(c), on an experimental basis. Any contractor that performs work in multiple trades on a road construction project under the craft training experiment will have an apprenticeship in at least one, not all of the trades on the project to comply with this experiment. Upon the completion of these experiments, the Department shall report to the Joint Legislative Committee on the Capital Improvement Program with its assessment of the program including, but not limited to, costsavings, project quality and worker safety. ABC was actively involved in re-wording both of these provisions in the bond bill. For a full copy of the State bond bill, click onhttp://legis.delaware.gov/LIS/lis146.nsf/vwLegislation/HB+410/$file/legis.pdf?open
The General Assembly put the finishing touches on a 3.58 billion operating budget. The budget contains no new taxes, no layoffs of state workers and represents a 2.3% increase over last year’s spending plan. It gives a 1% pay increase to active state employees at a cost of $20.7 million. For a full copy of the State budget, click on http://legis.delaware.gov/LIS/lis146.nsf/vwLegislation/SB+260/$file/legis.pdf?open