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Building A Stronger Economy

Building A Stronger Economy. 2005 NACF Meeting Oaxaca, Oax, Mexico Sam Hunter AGC of America President. Building Your Quality of Life. AGC’s Goals and Guiding Principles. Promote construction industry growth Establish infrastructure investment as a necessary element of economic growth

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Building A Stronger Economy

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  1. Building A Stronger Economy 2005 NACF Meeting Oaxaca, Oax, Mexico Sam Hunter AGC of America President Building Your Quality of Life

  2. AGC’s Goals and Guiding Principles • Promote construction industry growth • Establish infrastructure investment as a necessary element of economic growth • Ensure that taxation, regulation and mandates are designed to promote economic opportunity for AGC members Building Your Quality of Life

  3. How We Achieve Our Goals • Credibility • Staff • 20 Staffers Who Monitor Legislative and Regulatory Issues • Chapters • 98 Chapters Across the U.S. • At least one chapter in each state • Active Membership • 33,000 member companies • 7,000 general contractors • 11,000 specialty-contracting firms • 13,000 service providers and suppliers • Political Connections Building Your Quality of Life

  4. What AGC Offers • Evaluate the Political Atmosphere • Identify Viable Agenda Options • Discussion of Strategy • Action items • Communicate Priorities Internally and Externally • Continue to Lead Important Coalitions • Coordinate Targeted Grass Roots Campaigns • Identify Champions • Deliver the Votes Building Your Quality of Life

  5. AGC Overview • AGC has a Broad Agenda • AGC has a Substantial Presence • Elections and Policy Decisions have Consequences for the Industry • Government Regulations Cost the Economy an Estimated $850 Billion Annually • The Industry Needs to Participate in the Process • AGC has Made it Easy Building Your Quality of Life

  6. AGC Legislative and Regulatory Goals • AGC PAC • Infrastructure Investment • Highway Reauthorization • Drinking And Wastewater • Water Resources • Reverse Auctions • Tax Policy • Environment • Tort Reform • Safety & Health • Immigration Reform Building Your Quality of Life

  7. AGC Legislative and Regulatory Goals • AGC MAKES A DIFFERENCE ON ELECTION DAY! • AGC PAC will raise and spend $1,000,000 during the 2006 election cycle. • In 2004 AGC PAC supported the winning candidate 89% of the time. • AGC’s Legislative Action Center (www.agc.org/lac) keeps members informed. • AGC Grassroots encourages members to register and vote. • AGC PAC SPECIFICS • Contributions all personal, not corporate. • AGC PAC & Grassroots actively engages in federal races. • Construction industry needs must be heard! Building Your Quality of Life

  8. AGC Legislative and Regulatory Goals • INFRASTRUCTURE INVESTMENT – • HIGHWAY REAUTHORIZATION • Congress passed Transportation Equity Act July 29. • $286.4 billion over six years – A 31% increase • Largest public works bill in U.S. history. • AGC played a central leadership role Building Your Quality of Life

  9. AGC Legislative and Regulatory Goals • INFRASTRUCTURE INVESTMENT – • HIGHWAY REAUTHORIZATION • Key AGC Policy Victories: • Maintain Highway Trust Fund Integrity • AGC worked to ensure all dollars will be used for transportation • Streamline Environmental Review Process • AGC pushed to highway planning and project development streamlined to complete vital transportation projects quickly • Improve Work Zone Safety • AGC sought to protect industry’s workers and the public by increasing awareness and commitment to work zone safety Building Your Quality of Life

  10. AGC Legislative and Regulatory Goals • INFRASTRUCTURE INVESTMENT – • DRINKING AND WASTEWATER • Over next 20 years: • Drinking water investment needs between $70 billion - $362 billion. • Wastewater investment needs between $132 - $388 billion. Building Your Quality of Life

  11. AGC Legislative and Regulatory Goals • INFRASTRUCTURE INVESTMENT – • WATER RESOURCES • Water resources projects not keeping pace with economic and social expansion • Waterways programs grow U.S. economy: • Every $1B expended = 40,000 jobs. • Flood damage reduction provides a six-to-one return. • O&M on locks and dams provides 14-1 return. • AGC focused to increase federal investment. Building Your Quality of Life

  12. AGC Legislative and Regulatory Goals • REVERSE AUCTIONS • AGC working with Congressional Leaders to prohibit procurement of Federal construction projects using Reverse Auctions. • House of Representatives has passed legislation to accomplish this goal. • Senate expected to pass similar measure this fall. Building Your Quality of Life

  13. AGC Legislative and Regulatory Goals • TAX POLICY • House of Representatives approved full and permanent repeal of “death tax.” • Death tax scheduled for elimination in 2010. • Full repeal expires in 2011. • AGC urging Senate to schedule similar vote. • The President has repeatedly stated his desire to sign this legislation. Building Your Quality of Life

  14. AGC Legislative and Regulatory Goals • ENVIRONMENT • AGC and U.S. Environmental Protection Agency partnering: • Goal: Reduce regulatory burdens and improve compliance. • AGC responded to numerous proposals impacting construction. • AGC offers services promoting our positive contributions to environmental stewardship. Building Your Quality of Life

  15. AGC Legislative and Regulatory Goals • TORT REFORM • 67 companies forced into bankruptcy because of asbestos litigation. • 500,000 employees have lost jobs. • Between $375 and $650 billion in stock value evaporated. • AGC supporting legislation to address litigation challenges. Building Your Quality of Life

  16. AGC Legislative and Regulatory Goals • SAFETY & HEALTH • AGC & OSHA working on Trenching Initiative Task Force. • OSHA proposing silica, hexavalent chromium, & confined space standards. • Negotiated Rulemaking for Cranes & Derricks • OSHA preparing final consensus language • OSHA Susan Harwood Training Grant • Fall Protection Training - 1,500 people trained to date • Every AGC General Contractor sent CD-Rom (10,000) Building Your Quality of Life

  17. AGC Legislative and Regulatory Goals • IMMIGRATION REFORM • Shortage of skilled and unskilled workers in construction must be addressed. • Streamline legalization process: • Need workable and realistic guest worker program. • Today’s immigrants are highly skilled and provide a valuable service • Congress has introduced legislation to reform the system. • Action expected in the fall of 2005 and will probably continue into 2006. • AGC continues to work with Congressional leaders to develop a reasonable and workable guest worker program. Building Your Quality of Life

  18. U.S. Economy and Construction • Construction A Major Part of U.S. Economy: • 7.3 million workers in 700,000 companies. • 2 million firms operate without employees. • 12% of all non-employer firms. • Value of construction put in place in 2004 totaled $1 Trillion • 8% of GDP. • Construction machinery shipments exceeded $500 billion in 2004 • 11% of all manufacturing shipments. Building Your Quality of Life

  19. U.S. Economy and Construction • Construction has Done Well in 2005: • Construction employment rose by 277,000 from August 2004 to August 2005. • A new record • Value of construction put in place rose nearly 9% in the seven months of 2005. • Year-to-date orders for construction materials, supplies, and machinery are all up Building Your Quality of Life

  20. U.S. Economy and Construction • All Segments Grew in the First Seven Months of 2005: • Private residential construction put in place rose 12% over same period last year. • Private nonresidential construction grew 5%. • Public construction rose 6%. • However, these gains are only partly real. • Steep price increases for steel and many other inputs reflected. Building Your Quality of Life

  21. U.S. Economy and Construction Remainder of 2005 and 2006 will be affected by impacts of Hurricane Katrina: • The cost of diesel fuel to operate equipment and trucks and pay for deliveries of materials will eat into profits. • Oil and natural gas price increases and shortages will affect asphalt, plastics, roofing and insulation. • Cement and labor shortages could become more widespread. Building Your Quality of Life

  22. U.S. Economy and Construction • There will be lots of stabilization, repair, and demolition work. • Reconstruction will depend on funding and decisions about whether rebuilding is safe and sensible. • Other regions will grow a bit faster as families and businesses relocate. • Higher gas and heating costs will force consumer cutbacks, hurting some types of construction. Building Your Quality of Life

  23. The Associated General Contractors of America Building Your Quality of Life

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