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Legislative Priorities 2008
ASM filed or co-sponsored eight bills on Beacon Hill for the 2007-08 legislative session, many of them relating to payment for work performed, which is the #1 business issue of concern to subcontractors. We want to extend a public “thank you” to the Senators and Representatives who sponsored the bills and filed them on our behalf. Several of the bills are co-sponsored jointly with other industry organizations, reflecting ASM’s commitment to working cooperatively with all members of the building team for changes that benefit the entire industry.
Call to Action !
As 2008 begins, ASM is mounting a major grassroots campaign to urge the Legislature to act on our bills, in particular, the three at the top of the list – H.1789, H.3266 and S.1855. You can help by contacting YOUR legislators – for either your home or business district, to ask for their support of these bills. In the summaries below, you will find links to brief talking points and more detailed information, as well as a copy of the bill itself.
Contact ASM if you need more information, or Take Action Now!
FAIRNESS IN PRIVATE CONSTRUCTION CONTRACTS (aka “Prompt Pay” bill) (H. 1789)
Filed by Rep. David Flynn (Bridgewater) and Sen. Mark Pacheco (Taunton) for ASM.
New in 2007, this bill addresses the systemic problem of slow payment in the construction industry, by requiring all private construction contracts to include fair payment terms, with reasonable times to make payments, and strong incentives to pay timely. Drafted by ASM’s Prompt Payment Task Force, it was modeled on laws passed in Kansas, Arizona, Connecticut, New York and a number of other states. The proposed legislation promotes “prompt payment” as the industry standard, and applies payment requirements equitably to all parties involved in a project, including owners, general contractors, subcontractors and sub-subcontractors. The current bill is an early draft, and substitute language has been submitted. Read brief talking points. Read detailed position paper and the redrafted bill.
Status: In Committee on Labor and Workforce Development—Sen. Thomas McGee (Lynn) and Rep. David Torrisi, (North Andover), Committee Chairs. Public hearing was held on February 13, 2008.
“PAY-IF-PAID” RESTRICTIONS (H. 3266)
Filed by Rep. Martin Walsh (Dorchester) and Sen. Stephen Brewer (Barre) for ASM. Co-sponsored by AGC, and supported by the 21-member MA Construction Industry Council
Promotes fairness in construction contracts by prohibiting “pay-if-paid” language (that says a subcontractor gets paid only if the general contractor gets paid), except in limited situations. Allows pay if paid only in cases of nonperformance by the sub; or if the general contractor files notice of contract at the start of a project and takes all reasonable steps to secure payment. It represents a compromise negotiated with AGC, integrates perfectly with the state’s mechanics lien law, and replaces ASM’s past legislation which proposed to ban pay-if-paid clauses altogether. Read brief talking points. Read formal position paper. Read the actual bill.
Status: Reported out favorably by Joint Committee on State Administration—Sen. Dianne Wilkerson (Boston) and Rep. Antonio Cabral (New Bedford), Committee Chairs. Now in House Ways & Means—Rep. Robert DeLeo (Winthrop), Committee Chair.
History: This bill was enacted by House and Senate in 2004 but was vetoed by the Governor. It was re-filed in 2005 and reported favorably by the Committee on State Administration, but died in House Ways & Means at the end of 2006.. Refiled in January 2007.
INDEMNITY / INSURANCE LIABILITY PROTECTION (S. 1855)
Filed by Sen. Stephen Buoniconti (Springfield) for ASM; co-sponsored by AGC.
Prohibits any provision in a construction contract that requires general contractors or subcontractors to provide indemnification or insurance to cover damage or injuries caused by other parties. It calls for all parties to take responsibility for their own negligence and pay costs in proportion to their fault. It does not diminish the responsibility of all parties to pay 100% of damages to injured plaintiffs, but simply changes the way the contracting parties agree to allocate the costs among themselves. It isn’t a new concept, but is what law originally intended, until a court decision changed the interpretation. S.1855 is all about fairness in sharing risks and costs. Read brief talking points. Read formal position paper. Read the actual bill.
Status: Reported out favorably by the Joint Committee on State Administration—Sen. Dianne Wilkerson (Boston) and Rep. Antonio Cabral (New Bedford), Committee Chairs. Now in Senate Ways & Means—Sen. Stephen Panagiotakos (Lowell), Committee Chair.
History: This bill won Senate approval in 2002, but has been stalled since then due to opposition from owners, architects and trial attorneys due to misunderstanding of the intent and the impact.
COST EFFICIENT CONSTRUCTION (H. 3261)
Filed by Rep. Joseph Wagner (Chicopee) & Sen. Steven Baddour (Methuen) for CIM; co-sponsored by ASM and AGC.
Prohibits “no damages for delay” clauses in public contracts, and allows contractors to recover increased costs (but not profits) resulting from delays caused by the public owner. Will keep down the costs of construction by eliminating the need for contractors to increase their bids to cover the cost of potential delays caused by others. Read position paper.
Status: In Joint Committee on State Administration—Sen. Dianne Wilkerson (Boston) and Rep. Antonio Cabral (New Bedford), Committee Chairs
History: This bill has always met with strong opposition from public owners due to reluctance to incur additional costs in case of delay, despite the promise of saving more in bid prices by reducing contingencies. Reported favorably by the Committee on State Administration but died in House Ways & Means, 1/3/07.
DIRECT PAYMENT RIGHTS (S. 1875 and H. 3262)
Filed by Sen. Thomas McGee (Lynn) for ASM and by Rep. Joseph Wagner (Chicopee) for CIM.
Gives subcontractors on public works projects (roads & bridges) the same payment rights as subcontractors on public building projects, by allowing them to file for direct payment from the owner, when general contractors fail to pay for work performed. Read position paper.
Status: In Joint Committee on State Administration—Sen. Dianne Wilkerson (Boston) and Rep. Antonio Cabral (New Bedford), Committee Chairs
History: This bill has been re-filed repeatedly, but has failed to win broad support. Reported favorably by the Committee on State Administration but died in House Ways & Means at the end of 2006.
TIMELY FINAL PAYMENT (H. 3263)
Filed by Rep. Joseph Wagner (Chicopee) for CIM; co-sponsored by ASM and AGC.
Requires final payment on a public works project within one year of substantial completion. Read position paper.
Status: In Joint Committee on State Administration—Sen. Dianne Wilkerson (Boston) and Rep. Antonio Cabral (New Bedford), Committee Chairs
History: This bill has likewise been re-filed repeatedly, but has failed to gain traction. Reported favorably by the Committee on State Administration but died in House Ways & Means, 1/3/07.
CLARIFICATION OF THE LAW ON PROPRIETARY SPECIFICATIONS (“three or equal” law) (H. 3170)
Filed by Rep. Antonio Cabral (New Bedford) & Rep. Paul Kujawski (Uxbridge) for ASM; co-sponsored by AGC.
Clarifies the rule on “proprietary specifications” to promote competition in the procurement of materials for building projects. Requires designers to list three brands that are acceptable, or three manufacturers who can meet the specifications; and stops the practice of naming “proprietary” items without good reason and without giving detailed product specifications. Read position paper.
Status: Reported favorably by the Joint Committee on State Administration—Sen. Dianne Wilkerson (Boston) and Rep. Antonio Cabral (New Bedford), Committee Chairs. Now in House Ways & Means—Rep. Robert DeLeo (Winthrop), Committee Chair.
History: This bill represents a merger of a bill filed in past years by ASM and a similar one filed separately by the Inspector General of the Commonwealth. Both bills were reported favorably by the Committee on State Administration in 2005, and the merged bill died in House Ways & Means at the end of2006. Refiled in January 2007.
FAIR UTILITY COMPETITION (H.3281; H. 3339 and S. 1992)
Filed by Rep. Daniel Bosley (North Adams), Rep. Charles Murphy (Burlington), and Sen. Steven Tolman (Watertown) for MassachusettsAlliance for Fair Competition, a coalition of union and nonunion groups that includes ASM.
The bill adds teeth to existing regulations that prohibit gas and electric utilities from “cross subsidizing” their affiliated service companies with money they get from their ratepayers. It would stop utilities from providing manpower, vehicles, equipment or marketing support that give their affiliates an unfair advantage in competing against small business HVAC and electrical contractors.
Status: Reported favorably by the Joint Committee on Telecommunications, Utilities & Energy, 12/31/07—Sen. Michael Morrissey (Quincy) & Rep. Brian Dempsey (Haverhill), Committee Chairs. Now in Senate Ways & Means—Sen. Stephen Panagiotakos (Lowell), Committee Chair.
History: The Alliance overcame stiff opposition from utility unions in 2006 and won broad support in the legislature. It was reported favorably by the Senate Ways & Means but due to late timing, died without further action at the end of 2006. Refiled in January 2007.
CONSTRUCTION REFORM TECHNICAL CORRECTIONS (H. 3172)
Filed by Rep. Antonio Cabral (New Bedford) on behalf of the Construction Reform Commission
The omnibus “Technical Corrections Bill” includes numerous critical corrections, including some of a substantive nature, to the Construction Reform legislation of 2004.
Status: In Joint Committee on State Administration—Sen. Dianne Wilkerson (Boston) and Rep. Antonio Cabral (New Bedford), Committee Chairs
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