Government Affairs

General Assembly Update

February 15, 2012

BONDING BILL PASSES WITH VTCA AMENDMENTS

HB 945, as originally proposed, would rise from $250,000 to $500,000 the contract amount for which performance and payment bonds are required on transportation-related projects partially or wholly funded by the Commonwealth. VTCA opposed the bill and proposed a series of amendments. Those amendments were accepted. The bill now requires companies bidding on projects between $250,000 and $350,000 to apply for a bid bond through the private sector. If they are able to get one, they must do so. If they win the bid, they must then supply a performance and payment bond from the private sector. If a company bidding on a project in that range cannot get a bid bond, they are eligible for a financial sufficiency review by VDOT and enrollment in a state sponsored insurance program. All projects over $350,000 require bid, performance and payment bonds issued by the private sector.

VTCA SUCCESSFUL IN STOPPING COOPERATIVE PROCUREMENT EXPANSION

SB 679 and HB 1295, the Administration’s bills to “reduce or eliminate” mandates on local governments contained language that would have repealed the protections on cooperative procurement. Cooperative procurement allows one or more jurisdictions to use the procurement of another jurisdiction. Thus, Jurisdiction A could go out to bid for goods and services, then jurisdictions B, C, and D could use that procurement for the same goods and services…without ever having to go out to bid. Two years ago VTCA worked to pass a $200,000/75 mile limitation on the use of cooperative procurement. SB 679 and HB 1295 would have removed those limitations. VTCA lobbied successfully to keep the protections on. The House and Senate have passed their respective bills.

MECHANICS LIEN BILL PASSES WITH AMENDMENTS

HB 1265, as originally proposed, provided that a mechanics’ lien claimant must send to the property owner written notice of his intent to file a memorandum of lien and a copy of the memorandum at least 60 days before filing the memorandum with the clerk of the court. The clerk could not accept or record any memorandum of lien that is filed prior to the expiration of the 60-day period or that is not accompanied by a copy of the notice sent to the property owner. These provisions would have place an unreasonable burden on VTCA members that do residential or commercial work. Working with the Patron and other industry groups, VTCA was able to get several significant amendments made to the bill. The revised bill, passed by the House with amendments, can be found at: Revised HB 1265

VTCA SUCCESSFUL AT DEFEATING “BEST VALUE” CONTRACTING

SB 260 authorized the governing body of a locality with a population in excess of 100,000 to procure construction on a best value procurement basis. Under the bill, if proceeding on a best value procurement basis, the Request for Proposal must contain a notice to potential offerors that the procurement decision will be made on a best value procurement basis and describe the (i) criteria that will be considered in evaluating the proposals, and (ii) the rating or weighting system that will be used in evaluating the proposals, including a disclosure that price will be weighted at least 51 percent as a factor. VTCA strongly opposed the bill, and it “stricken from the docket” in the Senate General Law and Technology Committee.

WEIGHT LIMITS EXTENDED

The Senate has passed SB 335 which extends the temporary increased weight limit for trucks hauling sand, gravel, or crushed stone in coal counties to July 1, 2013.

EMINENT DOMAIN LEGISLATION PASSES

A state constitutional amendment that would limit the ability of local governments to claim private land under eminent domain cleared the Senate and the House of Delegates.

HB 5 and SB 240 provide for a referendum at the November 6, 2012, election to approve or reject an amendment eliminating the General Assembly’s authority to define a public use for which private property may be taken or damaged and (i) requiring that eminent domain be exercised for public uses and not for the primary purpose of private gain, private benefit, private enterprise, increasing jobs, increasing tax revenue, or economic development; (ii) defining what is to be included in determining just compensation for permissible takings; and (iii) prohibiting the taking of more private property than is necessary for the stated public use.

To become law, a proposed constitutional amendment must pass the legislature in two different sessions, with a House election in between, and then win voters’ approval in a state referendum. Identical legislation passed last year.

SB 437 and HB 1035 also passed their respective houses. These bills provide definitions for the terms “lost profits” and “lost access” and how to determine the amount of just compensation, which includes lost profits and lost access resulting from the taking, that must be paid for property taken by eminent domain. The bills have a contingent effective date of January 1, 2013, provided that the voters approve an amendment to Section 11 of Article I of the Constitution of Virginia at the 2012 November election.

OMNIBUS TRANSPORTATION BILLS PASS

The Governor’s Omnibus Transportation bills HB 1248 SB 639 passed the House and Senate in substantially different forms. Both the Senate and House agree on removing the creation of a new tolling authority. The House version still has intact the Governor’s proposal to increase funding for transportation by moving, over an eight year period, ¼ of a percent of the sales tax revenues from the general fund to transportation. The Senate has rejected this idea, substituting a gas tax indexing provision instead. The House version keeps the study on devolution, the Senate version strips it out.

The Senate plan also removes the sunset clause from local income tax option of up to 1% for Northern Virginia, Norfolk and Virginia Beach and authorizes localities to withdraw from state secondary road program and impose a local meals tax. In addition the Senate version deletes: Re-direction of 1% of future general fund revenue growth over 8% to transportation; Transportation Improvement Districts where portion of economic growth is dedicated to transportation; Naming rights for transportation facilities.

The vote on SB 639 was:

YEAS—Barker, Blevins, Colgan, Deeds, Ebbin, Edwards, Favola, Hanger, Herring, Howell, Locke, Lucas, Marsden, Marsh, McEachin, Miller, Y.B., Norment, Northam, Petersen, Puckett, Puller, Ruff, Saslaw, Stosch, Wagner, Watkins—26.

NAYS—Black, Carrico, Garrett, Martin, McDougle, McWaters, Miller, J.C., Newman, Obenshain, Reeves, Smith, Stanley, Stuart, Vogel—14.

[NOTE: SB 631 introduced by Senator Watkins (R-Chesterfield) provided for an annual indexing of the gas tax based on the increase in the cost of highway construction materials. VTCA drafted and worked with Senator Watkins to introduce SB 631. Because SB 639 contains an indexing provision, Senator Watkins asked that his bill be stricken from the docket.]

Now each bill will go over to the other body for action. Because of the significant differences it is likely that the House will just kill the Senate bill instead of conforming it to the House version. This could result in the bills NOT going to a conference committee for resolution.

PPTA OVERSIGHT COMMITTEE BILL CARRIED OVER

HB 741 authorizes the Public-Private Partnership Advisory Commission to review the detailed proposal for certain qualifying transportation facilities under the Public-Private Transportation Act of 1995 prior to the execution of an interim or comprehensive agreement by the responsible public entity. The bill sets out the time frames for review by the Commission. The bill also requires a public hearing on proposals during the proposal review period. VTCA opposed the bill as an unreasonable and unnecessary hindrance to the advancement of PPTA projects. The bill was carried over until 2013 in the House General Laws Committee.

TRUCK WEIGHT MEASURE PASSES

HB 806 passed the House. The bill provides a uniform method of assigning cost-based fees based on the amount that a vehicle is overweight. The bill also allocates payment of fees into specific funds. The bill has a delayed effective date of January 1, 2013. This bill was the result of a year’s work by a stakeholder group (including VTCA) that agreed to modest increases in overweight permit fees provided that DMV instituted a series of reforms that would significantly simplify and expedite the issuance of overweight permits.

MID-SESSION SUMMARY

Below is a mid-session summary of critical bills that VTCA is engaged in for its members.

Mid-Session Report