TURNAROUND REACHED IN KANSAS
February 23 marked “Turnaround Day” in Kansas. That’s the final day for consideration of bills in their house of origin, except for bills referred to certain “deadline-exempt” committees in each house. Some 276 House bills and 166 Senate bills have been introduced so far this legislative session. A total of 573 bills introduced in the 2015 legislative session were carried over to this session as is the case in all odd-numbered years. Action on bills will pick up now that the budget (H Sub for SB 161) for FY’16 and ’17 has been approved. Following are summaries of legislation of interest.
BONDS AND PUBLIC-PRIVATE PARTNERSHIP AGREEMENTS
Senate Bill 475 was referred to the deadline-exempt Senate Ways and Means Committee on February 22 and will likely be scheduled for hearing in the near future. This bill provides that a contractor entering into a contract of $25,000 or more that involves a public-private agreement shall provide a performance bond made solely for the protection of the owner in an amount equal to the full contract amount conditioned upon the faithful performance of the contract in accordance with plans, specifications and conditions together with a payment bond in an amount equal to the full contract amount solely for the protection of claimants supplying labor or materials to the contractor or subcontractors in the prosecution of the work. Such bonds shall become binding upon award of the contract and each bond shall include a provision allowing the prevailing party in any action on a bond to recover reasonable attorney fees and expenses as determined by a court.
"Public-private agreement" is defined as an agreement for public construction involving a nontraditional arrangement between the owner and one or more private entities, including a contractor, that provides for acceptance by the owner of a private contribution to the public construction project in exchange for a public benefit concerning such public construction project other than only a money payment. “Private contribution" means the supply by a private entity of resources to accomplish all or any part of the work to be performed under a public-private agreement, including, but not limited to, funds, financing, supplies, materials or engineering or construction services. The bill further defines “public-private agreement" as an agreement for public construction involving a nontraditional arrangement between the owner and one or more private entities, including a contractor, that provides for acceptance by the owner of a private contribution to the public construction project in exchange for a public benefit concerning such
public construction project other than only a money payment. Finally "public benefit" means a grant by the owner of a right or interest in or concerning the construction project and may include receipts or revenue arising out of, or in connection with, the grant of a right or interest
in the construction project. If adopted this act would become part of the Kansas Fairness in Public Construction Act. A February 16 hearing on a second bill, House Bill 2407, which would allow for public-private agreements on infrastructure projects was cancelled and will be rescheduled.
70% KANSAS WORKFORCE PREFERENCE BILL
FAILS TO MEET DEADLINE
We are pleased that House Bill 2574 failed to meet the February 23 turnaround deadline and has died in the House Commerce, Labor and Economic Development Committee. The Builders’ Association and Kansas City Chapter, AGC have actively opposed these “70% Kansas workforce“ bills for several years now as they would have required all contractors entering into a contract with a state agency for a project with an annual cost of $100,000 or more or performing work on a STAR bond project, to have their workforces, and their subcontractors’ workforces, made up of at least 70% Kansans. Such a preference would restrict competition and even bar Kansas contractors located near state lines who may not have at least a 70% Kansas workforce from competing for such work in their own state. This legislation would not only bar most qualified out-of-state contractors from competing for such work in Kansas, it would also hurt Kansas contractors and subcontractors who would like to compete for similar work in other states because of other states’ “reciprocal” preference laws which impose the same or similar restrictions in favor of their residents. We have historically opposed preference laws because open competition across state lines and across the boundary lines of political subdivisions within a state is essential to the building construction industry. In noting our opposition we have also advised legislators that a similar Missouri law was recently found to be unconstitutional.
IMMIGRATION-RELATED BILLS
House Bill 2525 remains alive in the deadline-exempt House Federal and State Affairs Committee. This bill would make it unlawful for an employer to knowingly hire, recruit or refer for a fee for employment an unauthorized alien. The attorney general would receive and may investigate any complaint that an employer knowingly employed an unauthorized alien. Upon receiving notification from the attorney general that an employer has knowingly employed an unauthorized alien, the district or county attorney may bring a civil action against such employer. A separate action may be filed for each business location at which the employer employs an
unauthorized alien. Upon a finding of the first violation the court may place the employer on probation for three years and require an affidavit that the employer has terminated the employment of all unauthorized aliens and shall not knowingly employ an unauthorized
alien. The court may place the employer on probation for 10 years upon a finding of a second violation and may order appropriate agencies to suspend or permanently revoke the employer’s license or licenses upon a third violation. An employer’s good faith use of e-verify would provide a rebuttable presumption that the employer did not knowingly hire an illegal alien. The bill provides that there shall be no contractor liability for subcontractor violations of the act. It provides that an employer shall not terminate or discriminate against an employee who files a complaint. In addition, any employer found guilty of knowingly hiring, recruiting or referring an illegal alien shall be barred from bidding on and performing public works for two years. The Builders’ Association and Kansas City Chapter, AGC have a neutral position on this proposal.
Two other immigration-related bills, Senate Bill 450 and House Bill 2587, also remain alive and deal with “sanctuary” policies and ordinances as currently drafted. A similar bill, House Bill 2466, was heard on February 3 but has died in the House Judiciary Committee for failure to meet the turnaround deadline for consideration of bills in their house of origin.
OTHER BILLS OF INTEREST
School Bond Projects – House Bill 2486 remains alive having been withdrawn from the House Education Committee and referred to the deadline-exempt Appropriations Committee. This bill would establish the School District Bond Project Review Board. For general obligation bonds that have been approved for issuance by a local election on or after January 1, 2016, capital improvement state aid would be paid only with approval by the review board. School districts would submit applications to the review board for approval. If approved, the board would be required to determine the extent of the facility being constructed or improved is to be utilized for direct instruction of students, as expressed by a percentage of the total utilization of the facility. In making a determination, the board could only consider basic building planning and design to be a part of the facility. Any architectural enhancements to a facility beyond basic building planning and design would not be considered part of the facility that would be utilized for direct instruction. The review board would certify to the State Board of Education the percentage of utilization and that percentage would be used in calculating state aid that the district would receive for bond payments. A companion bill, Senate Bill 356, was also kept alive by withdrawing it from the Senate Education Committee and referring it to the Ways and Means Committee.
Asbestos Control Act – House Bill 2516 was approved (122-0) by the House of Representatives on February 22 and has been received by the Senate. This bill would eliminate requirements for Kansas-specific training and certification of individuals who perform asbestos abatement work. The bill instead would require these individuals to meet federal training requirements, which are identical to current state requirements. The time period for which companies licensed under the Asbestos Control Act are required to keep records of employee training would be reduced from six years to three years to be consistent with the document retention policies of other Kansas air programs.
Contaminated Property Redevelopment Act – Senate Bill 365 was approved (36-4) by the Senate on February 23. As amended, this bill would establish the Contaminated Property Redevelopment Act, which would allow a purchaser of real property acquired after July 1, 2016, to be released from environmental liability for pre-existing contamination. The bill also would create a redevelopment program for municipalities. A purchaser would be allowed to apply to the Kansas Department of Health and Environment (KDHE) for a Certificate of Environmental Liability Release (CELR) by providing certain documentation set out in the bill. A CELR would not relieve the purchaser of the requirements or duties of an applicable environmental use control agreement or risk management plan. A CELR would be revoked or voided if the purchaser failed to meet certain requirements. If fraudulent information is provided to KDHE, the Secretary would be permitted to modify or revoke a CELR, including an order to clean up the site and an administrative penalty of up to $500 per day. Persons adversely affected by any decision would have 15 days to request a hearing, which would be conducted in accordance with the Kansas Administrative Procedure Act. The bill would establish the Contaminated Property Redevelopment Fund which would receive moneys from fees for CELR applications, federal Brownfields program; gifts, grants, reimbursements, appropriations, interest, penalties, and repayment of Brownfields loans and would be used for the administration of the bill and grants and loans to municipalities for Brownfields projects.
Reinstating compensation for the UC waiting week – Senate Bill 433 has died in the Senate Commerce Committee having failed to meet the turnaround deadline. This measure would have made unemployment compensation benefits payable for the one week waiting period upon completion of three weeks of unemployment consecutive to such waiting period.
As always, if you have questions about any of the pieces of legislation above, or would like us to look into a bill or issue not listed, please contact Allen Dillingham, Government Affairs Director for The Builders’ Association, at 816-595-4121 or . We also encourage you to contact your elected representatives on these pieces of legislation and other issues important to you and your business.