SFAA Members Take Construction Bill to Congress
Wednesday, May 07, 2014
MAY 7, 2014, WASHINGTON, D.C.— Today, nearly two dozen
representatives from SFAA member companies, along with SFAA staff, met with members
of Congress, mostly in the Senate, and their staffs as part of SFAA’s annual
Congressional Action Day. This year, SFAA and its members are focusing on
getting the federal Construction Coalition legislation put into play, which
includes simple procurement reforms that increase small business participation
in federal construction projects. Representatives from contractors associations
that are part of the Construction Coalition also participated with SFAA members
in some of their Hill visits as part of the effort to get the Coalition’s bill
dropped in the Senate.
“Congress came back from its spring recess
with a limited agenda of ‘must do’ items before fiscal year 2014 ends on
September 30, which includes funding the federal government beyond that date
and funding the Highway Trust Fund. That’s a small but very difficult agenda,” says
Lenore Marema, SFAA’s vice president of government affairs, who organizes
Congressional Action Day. “Congress will be looking for issues that can be
enacted on a bipartisan basis, and we’ve got just what they are looking for.”
part of the Coalition, which includes all the other stakeholders in public
construction. SFAA’s top federal surety issues, among others, are included in
- Exempting the Miller Act
bond threshold from the required periodic reviews for inflation. It makes
no sense that the level of payment protection for subcontractors and
suppliers on the job should be decreased as the costs of construction
increase. Similarly, the bill would assure that the Miller Act protections
are available on federal public-private partnerships (P3s). The need for
performance and payment protection is exactly the same in a P3 as any
other type of project.
- Requiring that the security that stands
behind every federal contractor’s obligations to the federal government
should be governed by the same rules. There should be either a corporate
surety bond in place from a company approved by the U.S. Treasury or assets
with readily identifiable value pledged and relinquished to the federal
government while the construction project is ongoing.
- Increasing the maximum
bond guarantee to sureties in the Preferred Surety Program of the Small
Business Administration from 70% to 90%. This change would make the
program more economically feasible for corporate sureties and their bond
producers, which would increase their participation in the program.
“The changes to the
federal procurement process in this bill are critical to small business
participation, and this is a bill that can get passed with bipartisan
support,” said Marema. A number of the provisions in the Coalition
legislation already are moving through the House with bipartisan support.
The Surety & Fidelity Association of America (SFAA)
is a trade association of
more than 450 insurance companies that write the vast majority of surety and
fidelity bonds in the U.S.
licensed as a rating or advisory organization in all states and it has been
designated by state insurance departments as a statistical agent for the
reporting of fidelity and surety experience.
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