FEDERAL UPDATE

ACECL held several virtual meetings and conference calls with the state's congressional delegation and/or their staff. The delegation has been briefed on some of the membership's ongoing concerns with the PPP program including:
  • IRS ruling that business expenses covered by PPP loan forgiveness is not tax deductible as they would be normally.
  • Liability protections.
  • DoD guidance that seeks a credit on contracts for the amount of the PPP loan. Click here for position paper.
The delegation thanked us for our feedback and, in some cases, for making them aware of the issues. They will engage SBA and Treasury to seek resolution.

All expect another round of assistance for small business, particularly additional flexibility with the PPP program and more funds for local/state governments.

All also expressed support for increased funding for infrastructure for both addressing the country's crumbling infrastructure and to stimulate the economy.
The House will be taking up major infrastructure legislation next week -- the Moving Forward Act (H.R. 2). While this legislation will not be considered as a whole in the Senate – it represents the House Democratic leadership’s vision for an infrastructure-based recovery agenda – it does enable the House to enter into negotiations with the Senate on a new multi-year surface transportation program to replace the FAST Act – should the Senate proceed with passage of its own legislation -- and creates the possibility of including additional initiatives that have bipartisan support in the context of those negotiations.
HR 2 would authorize transportation, energy, water, brownfields, broadband, public housing, health care facilities, and public school construction programs and funding over five years. The bill totals approximately $1.5 trillion in investment from FY 2021-25.
  • Text of the Moving Forward Act is here.
  • The Section by Section summary is here.
  • A Five-Page Fact Sheet is here.

Surface Transportation
The bill incorporates the text of the INVEST in America Act , the five-year, $494 billion surface transportation reauthorization bill approved by the House Transportation & Infrastructure Committee. That bill includes
  • $311 billion for federal highway programs
  • $105 billion for transit programs
  • $60 billion for passenger rail
The bill extends current programs through FY’21 and adds $14.7 billion for highways and $6.75 billion for transit, and it waives the non-federal match for FY 2021. New programs would go into effect in FY 2022.
Note that ACEC is preparing for the possibility of one or more amendments that seek to restrict the ability of State DOTs to contract out, including one that may be offered by Rep. John Garamendi (D-CA) that would require construction inspection services to be performed only by DOT employees. ACECL has made our delegation aware although this is a democratic driven bill so the Republican members will not have any influence at this point. However, ACEC will be working on continued outreach to Chairman DeFazio and to the Rules Committee to explain the negative impact this will have on firms and on DOTs and other agencies. They have alerted AASHTO and are enlisting their help as well. If the amendment is made in order for a vote by the full House, we’ll launch a broad grassroots alert to ACEC members we will reach out again to our delegation.

Aviation
The bill increases annual Airport Improvement Program funding to $4 billion and authorizes an additional $17.5 billion in supplemental airport funding over 5 years (subject to appropriations).
Water 
  • $25 billion to improve drinking water infrastructure;
  • $500 million annual grant program to support technology investments to remove per- and polyfluoroalkyl (PFAS) substances from drinking water;
  • $40 billion in new wastewater infrastructure – $8 billion annually – in funding for the Clean Water SRF program;
  • Appropriates an additional $10 billion to the U.S. Army Corps of Engineers (Civil Works) Construction account;
  • $1 billion ($200 million annually) in grants to owners and operators of publicly owned treatment works to implement Clean Water permit limits for the discharge of PFAS-related chemicals or other potential contaminants of emerging concern as identified by EPA.
Energy
  • $700 million annually in electricity grid modernization projects with eligible partnerships (national labs, educational institutions, state or local governments, electric utilities, and transmission organizations) including advanced controls for transmission and distribution to improve resilient, reliable, and affordable service through distributed generation, microgrids, storage, electric vehicles, efficiency, and demand response. 
  • $250 million annually for grants for natural gas distribution performance improvements.
  • $200 million annually for solar grants to serve low-income populations.
  • Renewable Energy -- Revives and extends the Production Tax Credit for most renewable energy facilities through 2025; geothermal through 2020; and wind preserved at current levels through 2020, then extended at 60% through 2025; ITCs are extended through 2025 for geothermal, wind, solar, CHP, storage, etc. The bill also includes the 45Q extension for carbon oxide sequestration credits, and 48(a)(5) credit extension for offshore wind facilities.
Broadband
  • Appropriates $80 billion to fund competitive bidding systems to build broadband infrastructure for broadband internet infrastructure to unserved and underserved rural, suburban, and urban communities
  • $5 billion Broadband Infrastructure Financing Innovation (BIFIA) program, to provide State and local governments, public authorities, and public-private partnerships financing through secured loans, lines of credit, and loan guarantees for eligible projects;
  • Appropriates $125 million annually for five years for formula grants to states to implement “digital equity plans, and an additional $125 million for competitive grants in FY 2021.
School Construction
  • Authorizes $100 billion over 4 years for public school construction and improvements, funds apportioned to states by formula under Title I.
Health Care Facilities
  • Provides $10 billion in total funding for fiscal years 2021 through 2025 for the construction and modernization of hospitals and medical facilities.
  • Authorizes $10 billion in total funding for community health center capital project grants for fiscal years 2021 through 2025.

Public Housing
  • Authorizes $70 billion to the public housing capital fund for public housing agencies to address the estimated backlog of physical repairs needed to maintain safe and decent housing.
STATE NEWS
DOTD Consultant Selection Changes
DOTD has added increased ethics requirements on the new PET members and consultants. Expect an informational memo relative to the new requirements, along with the individuals that will serve on the three PET committees, to be posted on MyDOTD in the next couple of days. ACECL was able to provide feedback before implementation and it is reflected in the final policy which is more reasonable and easier to follow. See link to a draft of the language to be included in consultant contracts here.

Additional notes:
  • While prohibitions on social interaction are removed from the policy, be aware that in social situations, you should avoid discussing advertised projects AND projects on the projected list with PET members. Keep it social only.
  • Questions regarding projects on the projected list should first go through CCS. CCS will facilitate questions with the project PM for response. For projects where the PM is not on the PET, this policy does not prohibit communication directly with PM. If a PM on a project on the projected list is on a PET, then there should be another PM that should be able to answer or meet with a consultant to help the consultant better understand the project.
  • It is the intent of DOTD to share as much as they know as soon as they know with all consultants about the scope of projects on the projected list to minimize the need for all consultants to each meet with a PM.
  • Relative to the PET teams:
  • Team 1 will serve 1 year. They would have to sit out 1 year before serving again.
  • Team 2 will serve 2 years. They would have to sit out 1 year before serving again.
  • Team 3 (back up to Teams 1 and 2) will serve for three years and will be used when there is a conflict of any member of Team 1 or Team 2 on a project. They will be back up for Year 1 then become active in Year 2 and 3.
  • A PET member with a conflict on a project will not be substituted out. The entire PET will be substituted with another Team.
  • Terms start July 1-June 30.
  • Ads coming out starting July 1 will look differently. Please read the advertisements carefully. Ads will be out for 30 days, not 28.

Indirect Cost Rate
  • DOTD will start requesting information on low risk firms. For those who submit cognizant rates, those can be submitted now. DOTD is aware there may be a lag time due to COVID19.
  • DOTD is aware of delays in getting approved overhead rates. It is not their intention to use provisional rates as much as it is being used. ACECL is working with DOTD on a possible virtual meeting with Audit Section and consultants

Consultant Claims
  • Consultants are encouraged to work with PMs to get contract amendments in place for time and value extensions rather than relying on claims process to get additional work paid.
  • If you see that work requested by DOTD may extend beyond contract value or term, ask PM to submit a contract amendment.
  • This is an issue that is audited by Legislative Auditor and FHWA.
  • Claims process was only developed to get consultants paid when something unexpected occurs on a project. Not as a routine matter as DOTD is starting to see. This is not always the fault of the consultant but consultants should be aware that part of the project evaluation will be "did the consultant stay in budget and on schedule."
Invoices
  • Please submit your invoices monthly.
  • The Legislative Auditor is seeing cases where contracts requiring monthly invoicing and payments but invoices are not received for 3 months.
  • This includes getting sub-contractor charges included in the monthly invoicing.

Traffic
  • DOTD continuing to monitor patterns and what other states are doing. Since this is not a time that traffic counts would occur, they will see what schools are planning to do for fall and make determination if there is not a return to normal or if new normal is much different than past patterns.
  • They do not want to hold up projects.
ACEC NEWS
  • The Design Professionals Coalition (the largest ACEC member firms) recently put together a report called Diversity & Inclusion: Keys to Success and Lessons Learned. The Resources chapter at the end is extremely useful.
  • ACEC hosted two webinars early this year on Inclusion and Diversity which can be accessed here and here. We will be hosting a webinar on the DPC report mentioned above on August 12, and others are in the works.
  • ACEC is developing a webinar with legal counsel Gibson and Dunn relative to the current COVID19 liability landscape and how to protect yourself. The webinar will be July 8 at 12:30Central. An invite will go out as soon as available.
  • ACEC Research Institute Roundtable Forecasts Substantial Changes to Building Design. Read More
  • ACEC Colorado developed a presentation on how to effectively use virtual meetings for presentations and interviews. They are making a recording available to all states. Here is a link to view: https://www.youtube.com/watch?v=kTo9M3KLyLA&feature=youtu.be. (NOTE: a description of the speakers and content appears under the video window via this link.)
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