april 5, 2016
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Legislative, Regulatory and Other News at a Glance for Grassroots Action
Currently thirty-five legislatures are in session: Alabama, Alaska, Arizona, California, Colorado, Connecticut, Delaware, District of Columbia, Federal, Hawaii,  Illinois, Iowa, Kansas, Kentucky, Maine, Maryland, Massachusetts, Michigan, Mississippi, Missouri, Nebraska, New Hampshire, New Jersey, New Mexico, New York, Ohio, Oklahoma,  Pennsylvania, Rhode Island, South Carolina, Tennessee, Vermont, Washington, Wisconsin, and Wyoming. 
In This Issue:
Federal Report
Rep. Hanna delivers letter and language to U.S. House Transportation and Infrastructure Committee 

On April 3, U.S. Representative Richard Hanna (R-NY-22) sent a letter and suggested language to his fellow colleagues on the House Transportation & Infrastructure Committee asking that they consider language to the 2016 Water Resources Reform and Development Act (WRRDA), a bipartisan water resources bill that strengthens the country's water transportation networks. WRRDA establishes 15 P3 pilot programs, which requires those P3 agreements to abide by all applicable federal statutes, including the federal Miller Act. WRRDA also includes a provision commonly known as the Water Infrastructure Finance and Innovation Act (WIFIA), which provides federal credit assistance in the form of direct loans, loan guarantees, and standby lines of credit to finance those P3 agreements. The Act, however, is silent as to whether bonds are required for WIFIA agreements. The surety industry believes that, when Congress appropriates funds to states and localities in the form of grants and loan guarantees for programs such as WIFIA, bonding requirements should be applied.

Requiring bonds on WIFIA agreements is NASBP's number one legislative priority this Congress. NASBP worked with Representative Hanna on several issues in the past (e.g. individual surety), so it was natural that NASBP seek the Congressman's expertise and guidance on this matter. After meeting with NASBP, Representative Hanna recognized the potential harm that taxpayers and downstream parties might suffer should bonds not be in place on WIFIA agreements. Subsequently, the Congressman was willing to offer the attached corrective language. The House Transportation Committee is expected to begin to debate the merits of the WRRDA bill later this spring. NASBP will keep its members apprised of our efforts.

State Report
Bond Indexing 
Wisconsin Assembly Bill 1003

WI AB 1003 (Tittl) repeals the current statute indexing dollar amounts for certain public works contracts. AB 1003 was referred to Committee on State Affairs and Government Operations. The bill is unlikely to pass as a standalone measure but proponents are hoping to get it included in the 2017 budget bill.
Public-Private Partnerships
Alabama Senate Bill 287

AL SB 287 (Pittman) allows the Alabama Corrections Institution Finance Authority to construct women's and regional prison facilities using various types of construction agreements, including design-build and would require the contracts to comply with Alabama's Little Miller Act. The bill is currently under further consideration in the Senate. 
Illinois Senate Bill 3277

IL SB 3277 (Stearns) allows any public agency to enter into a public-private partnership agreement with any private entity for improving transportation assets, public buildings, public services, or other public assets. Illinois' current P3 authorization is project specific. IL SB 3277 was assigned to the Senate Commerce and Economic Development.
Kentucky House Bill 309

KY HB 309 (Combs) authorizes P3 agreements for local governments. As introduced, the P3 agreements would require "delivery by the private partner of maintenance bonds, performance and payment bonds, warranties, guarantees, and optional letters of credit in connection with its activities under the agreement, in the forms and amounts satisfactory to the local government and in amounts necessary to provide adequate protection to the local government". 

Due to the work of Todd Loehnert and Brian Ayres of L A Surety in Louisville, HB 309 now includes a direct reference to the Little Miller Act for local governments. These members were able to offer an amendment supported by the surety industry through a contact in the Governor's office. The bill has been approved by both chambers and transmitted to the Governor. 
Louisiana Senate Bill 195

LA SB 195 (Cortez) authorizes the LA Department of Transportation and Development to enter into P3 agreements. P3 authorization in the state is currently piecemeal, with separate, limited, authorization for the Louisiana Expressway Authority, parishes and municipalities, and the Louisiana Transportation Authority (LTA). LA SB 195 would require the agreements to be subject to R.S. 48:2084 through 48:2084.15 which govern the LTA's ability to enter into P3 agreements. This statute requires the P3 agreement to provide for the delivery of performance and payment bonds or other security in connection with the construction of or improvements to the qualifying transportation facility in the forms and in amounts satisfactory to the LTA. NASBP is currently working to determine if and how many projects have been authorized through the LTA's authority. SB 195 has passed Senate and is currently in House.  
New Hampshire SB 549 

NH SB 549 (Lasky) establishes the public-private partnership infrastructure oversight commission. NASBP sent a letter to House Committee currently reviewing legislation requesting an amendment to the bill that references NH Little Miller Act. An executive session is scheduled for this week. 
Tennessee Senate Bill 2093

TN SB 2093 (Ketron) authorizes state and local entities to enter into P3 agreements for transportation projects. P3 agreements require the delivery of performance and payment bonds or other forms of security in connection with the development, redevelopment, or operation of the qualifying transportation facility, in the forms and amounts satisfactory to the responsible public entity. SB 2093 was amended in the Senate Ways and Means Committee and now directly cites the Little Miller Act for transportation projects. 
Subcontractor Default Insurance
Massachusetts House Bill 2808

MA HB 2808 (Rogers) amends Massachusetts Little Miller Act to allow Subcontractor Default Insurance in lieu of performance and payment bonds. Subcontractors must submit payment and performance bonds to the CMAR at no additional cost to the firm or awarding agency. NASBP opposes HB 2808 which was reported favorably out of committee. NASBP's contract lobbyist has indicated the bill was passed out of committee to appease its sponsor, but the measure is unlikely to advance.
Focal Point is an e-bulletin sent twice per month 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. Visit the NASBP Advocacy Resource Center. Copyright © 2015. NASBP. All rights reserved.
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