State Advocacy Update
Although we are constantly advocating on behalf of our members with our state partners these efforts obviously ramp up with the approach of the Legislative Session. The 2025 Regular Legislative Session starts two weeks from today. Because we are in an odd calendar year, this will be a fiscal focused session. We anticipate more tax reform bills being filed after the failure of Constitutional Amendment 2 at the ballots this past Saturday. Because of this we will have to again be on alert this session to be make measures like subjecting engineering services to sales tax are not passed.
In addition to tracking all the fiscal bills, ACECL will be engaged on the LaDOTD reform/modernization legislation that is expected to be filed. Since last summer, ACECL has invested its time and resources in this effort to make the department as efficient and effective as it can possibly be. The lack of funding is as big a need as departmental reforms, but the legislature has made it clear that they will not consider one new dollar of reoccurring revenue until real reforms are implemented and proven to be effective. Erich Ponti, the Executive Director of LCFOR will attend our Business Forum next week to provide our members with a first look at the reform legislation. Erich will take a deep dive into the legislation and get feedback from our members in the lead up to the session. If you are interested in the future of LaDOTD and what it means for your firms, I highly recommend you attend this event. You can register by scrolling down to the next session of this newsletter.
Speaking of the Business Forum, our Legislative Committee will also meet there to review and discuss the legislation ACECL plans to file this year. From anti-indemnification and duty to defend clarifications to closing another loophole in our state QBS law, we look forward to passing some statutory solutions to problems that have plague the business of engineering for far too long.
It is shaping up to be another interesting and active session so stay tuned and stay engaged as we will likely be reaching out to our membership for insight and action.
Federal Advocacy Update
U.S. DOT Grants Guidance
ACEC talked this week with the outreach director in Secretary Duffy's office, in part to reinforce their awareness about the continuing uncertainty around funding pauses for certain projects under the Infrastructure Investment and Jobs Act (IIJA). Some of you may have seen guidance that was circulated by the Secretary's office to modal administrators and division personnel outlining the process and procedure for approving or modifying projects that do not have a signed grant agreement. It's our understanding that was an internal office email, not an official memo of sorts, and just one of several messages that have provided direction for staff who are reviewing alignment between program grants and the Administration's Executive Orders.
We are cautiously optimistic these actions will unlock funding for some projects and provide more clarity to agencies and grantees on how to move forward. I also expect that we will see additional information on grant notifications soon.
Please feel free to reach out to me directly (bdirmann@acecl.org) if your firm is facing stop work orders or other disruptions in transportation projects.
Congressional Committee Chairs Op-Eds
This week House Transportation & Infrastructure Committee Chair Sam Graves (R-MO) and Senate Environment & Public Works Committee Chair Shelley Moore Capito (R-WV) each published opinion pieces in the Washington Times outlining their perspectives and priorities going into the surface transportation reauthorization debate.
Rep. Graves: Make America Build Again
Sen. Capito: The Surface Transportation Opportunity Before Us
It's helpful context to see what these leaders are thinking as we engage with them and other lawmakers, and where there are areas of significant opportunity and alignment.
DBE (Federal) Legal Challenges
We are continuing to closely monitor the lawsuits challenging the constitutionality of certain elements of the federal Disadvantaged Business Enterprise (DBE) program and related regulatory activity. At this point, we are not aware of any immediate changes impacting engineering firms or DBE goals on A/E services, but we want to keep you up to date with the latest developments.
Last month, the contractor plaintiffs in the case (Mid-America Milling) and the U.S. Department of Transportation jointly filed for a 90-day stay in the case “to permit [the federal government] the opportunity to consider [its] litigating position in this case and the Parties an opportunity to explore settlement.”
The parties state in the joint motion that the preliminary injunction issued by the court last fall would not be affected by the stay sought by the parties. According to at least one attorney we spoke with, it is unlikely that the judge would take a different approach since the parties are in agreement. So, the current injunction would remain in place and agencies will continue to remove DBE quotas or goals on federally funded transportation projects that the two plaintiff contractors might bid on (mostly in Midwest states where they do business).
We are also aware that a group of minority contractors has filed to intervene in the case. They want to participate in the lawsuit directly so that they are in a position to defend the DBE program in court. It’s not clear whether the judge in the case will rule on that motion prior to ruling on the 90-day stay requested by the parties. He may wait for the parties to determine any changes to their positions and/or agree to a settlement before taking any action on the motion to intervene.
This blog post on a reputable legal forum has good information and links to other material.
As we have said during briefings on this topic, we anticipated a likely change in posture by the U.S. DOT in the case based on the President’s Executive Orders and other statements on DEI initiatives and programs. The joint motion is the most recent step in that direction.
We will continue to keep you and the rest of the ACEC membership apprised of major developments in the case and any subsequent regulatory actions making changes to the DBE program.
