Beltway Buzz – Ogletree & Deakins
Democrats Claim Senate Majority. This week, Senator Raphael Warnock won a runoff election to serve a full term as U.S. senator for Georgia. The victory gave Senate Democrats a true majority (51–49) in the upper chamber for at least the next two years, beginning in January 2023. As the Buzz previously discussed, this means that Senate committee assignments will no longer be evenly divided between the two parties, and Democrats will instead maintain a slim majority on the committees, making it easier for them to advance legislation and nominations. The security of the Democrats’ newly expanded Senate majority was briefly unsettled today when Senator Kyrsten Sinema of Arizona announced that she would leave the Democratic Party and become an independent. However, Senator Sinema reportedly will keep her committee positions through the Democrats, effectively preserving the Democrats’ majority (though unlike independent senators Bernie Sanders of Vermont and Angus King of Maine, she will not attend Democratic caucus meetings).
NLRB Joint Employer Comments Due. The initial deadline for stakeholders to submit comments in response to the National Labor Relations Board’s (NLRB) proposed joint-employer regulation closed on December 7, 2022. Commenters will have another bite at the apple and may submit reply comments by December 21, 2022. This puts a final regulation on track to issue sometime within the next six to eight months—perhaps prior to the expiration of Member Gwynne A. Wilcox’s term in August 2023.
Treasury Issues Prevailing Wage, Apprenticeship Guidance. Late last week, the U.S. Department of the Treasury issued guidance purporting to clarify the prevailing wage and apprenticeship requirements for taxpayers wishing to take advantage of the green energy tax credit provisions of the Inflation Reduction Act (IRA). The guidance addresses the following issues:
- When do the requirements apply? These requirements will apply to covered construction projects that begin on or after January 30, 2023 (though the announcement by the Treasury Department states that January 29, 2023, is the key date).
- Apprenticeship. The IRA and the guidance require that a prescribed “percentage of the total labor hours of the construction, alteration, or repair work … is performed by qualified apprentices.” Those work hours are as follows:
- For work beginning before January 1, 2023: 10 percent
- For work beginning after December 31, 2022, and before January 1, 2024: 12.5 percent
- For work beginning after December 31, 2023: 15 percent
- Good faith effort exception. Pursuant to the guidance, a taxpayer will satisfy the apprenticeship requirements if it “requests qualified apprentices from a registered apprenticeship program,” and that request is denied or the program fails to respond within five business days.
- Prevailing wage requirements. In order to satisfy the prevailing wage requirements, the guidance instructs taxpayers to use the DOL’s published “prevailing wage determination for the geographic area and type or types of construction.” If such determination is not available, taxpayers are instructed to send an email to [email protected] to request a determination.
The guidance further states, “The Department of the Treasury (Treasury Department) and the IRS anticipate issuing proposed regulations and other guidance with respect to the prevailing wage and apprenticeship requirements.”
Central States Pension Fund to Receive $36 Billion. On December 8, 2022, the White House announced that the Central States, Southeast and Southwest Areas Pension Fund—which has been in crisis for years and is facing looming benefit reductions—will receive $36 billion in special financial assistance. The Special Financial Assistance Program was authorized by the American Rescue Plan Act of 2021 (which the U.S. Congress passed in 2021 pursuant to the arcane reconciliation process) to assist struggling multiemployer pension plans. According to a White House fact sheet, “The Central States Pension Fund estimates that it will now be able to pay full benefits to workers and retirees through 2051.”
Regulatory Agenda on the Way? The Buzz is keeping an eye out for the release of the Fall 2022 Regulatory Agenda. Last fall’s regulatory agenda was released on December 10, 2021, so with history as a guide, this year’s may be released soon. The agenda provides a forecast of federal rulemaking activities for the next six months.