IAPMO’s view from the Hill, and the industry — September 30

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Dain HansenDain Hansen is vice president of Government Relations, The IAPMO Group. He lends his frequent perspective of Capitol Hill, and the plumbing industry.

Here is an edited version of his update September 30, 2016

Congressional Update.

Overtime Controversy. The House this week passed a bill to delay by six months a controversial Department of Labor rule that expands overtime pay for more than 4 million U.S. workers. The rule specifically increases the salary threshold for workers to qualify for overtime pay from nearly $24,000 to about $47,000. The Chamber of Commerce and other large and small business organizations strongly oppose the rule, while organized labor groups support it. It is perhaps the biggest policy issue that has divided business and unions this year. While the House passed the measure, the Senate will have great difficulty passing it in the lame-duck session since it will require 60 votes for passage. The rule could probably be revised to gain bipartisan support if the salary threshold was merely increased, not doubled, but the political environment in Washington isn’t that tolerant these days. The Labor Department rule will stand for now and will continue to stand with a Clinton win but be subject to a likely reversal if Trump wins.

No Gas Tax? Many have previously covered the gas tax and its implication for federal spending on highway and infrastructure projects. While most still do not expect any changes to the gas tax in the near future, a lot are very interested in pilot projects in Oregon and California that relate to a vehicle miles traveled tax. Several states are watching too since they also are dealing with gas tax revenue that is not keeping pace with construction needs. With even more fuel efficient cars on the horizon, the problem will exacerbate, prompting lawmakers to already quietly note that eventually a shift in the funding mechanism for these projects will be needed. These pilot projects and others to come will help lay the foundation for a transformation on how car usage is taxed in the coming decades. This shift won’t happen overnight, but the current gas tax is not meeting the demand and the impact of such a shift is something to think about in the long-term.

New Rules For Employers on Paid Sick Leave and Equal Pay for Women. New rules will compel employers with federal contracts to provide paid sick leave for workers and require all businesses to collect data on salary differences between men and women under two final rules issued this week. The first rule, which President Barack Obama announced last year, will require federal contractors to provide as many as seven days of paid sick leave for their employees. The White House said the rule will mean additional sick leave for more than 1 million people. The rule takes effect January 1, 19 days before Obama leaves office. In a separate action, the Labor Department will require companies with more than 100 employees to report salary data broken down by gender, race and ethnicity for the first time.  The rule, intended to encourage companies to combat pay gaps between workers of different genders or races, will affect about 60,000 employers, the White House said. Companies will have to report the data by March 31, 2018.

Industry Update.

Water and Manufacturing Study Stresses Need for Stewardship. A new study by the U.S. Council on Competitiveness’ reveals challenges faced by water users in the manufacturing sector, where nearly half of industry water consumption is attributed.The report found that to meet increasing water demand, innovation in infrastructure, technology, investment and talent are needed to overcome challenges resulting from urbanization and population growth. The report made a number of recommendations including: modeling water consumption and availability to address gaps in supply and demand, engaging public/private stakeholders in a public awareness campaign to address water conservation needs, and addressing the skills gap in the water and manufacturing sector by de-stigmatizing technical careers and reintroducing hands-on training in K-12.

Drought Raises the Cost of Coffee and Juice. Across the country’s coffee belt, dry weather is hurting production of arabica and robusta beans. At the same time, too much rain in citrus areas hampered production of orange juice, while frost in sugar-growing regions has cut yields. Brazil is the world’s biggest producer and exporter of all three products, underscoring why supply problems have prompted investors to increase bets on price gains – a combined measure for holdings in the three products is at an all-time high. Sugar and orange-juice futures in New York are already trading near four-year highs. Arabica coffee, the variety favored by Starbucks Corp., last week reached the costliest since February 2015. Brazil’s weather problems are coming after El Nino spurred drought across Asia earlier this year, reducing sugar and coffee supplies. While dryness has been hurting many crops, the problem for orange trees has been excessive rain. In Florida, the No. 2 orange-juice supplier, a disease-spreading bug has devastated crops as it has elsewhere in the world. Global production of the beverage is already set to slump to the lowest in decades, according to the U.S. Department of Agriculture.

Solar Plant to Pay $1.5M in Air-Quality Fines. The Solana Generating Station has agreed to pay $1.5 million in fines for air-quality violations that date back to 2014. Solana is a concentrating solar plant that uses large, curved mirrors to focus sunlight on tubes of oil. The hot oil is used to make steam and spin turbines, generating about 250 megawatts of electricity. The department said the plant’s 21 air-quality violations include exceeding the pollution levels allowed by its permits, failure to conduct performance tests as required and removing an emissions control system without approval. Records released this week reveal that equipment used to control oxides of nitrogen from being released to the atmosphere from the heating of molten salt was damaged in November 2014 and the plant did not complete a required test to show it was functioning. The company also reported it had exceeded the emission limit for its heat-transfer fluid for the preceding 12-months by releasing 8,512 pounds of the fluid. The plant exceeded the amount of water it was permitted to run through its cooling towers in the first half of 2015. Solana power serves about 62,000 homes at once, and it can continue to make electricity for six hours past sunset by storing some of the heat.

During Smart Cities Week, Water is Recognized As A Major Challenge.  This week, federal, state and local government representatives celebrated Smart Cities Week to explore how smart technologies that can improve the livability, workability and sustainability of cities around the world. More than 30 countries and 130 American cities participated in activities during the week where water was recognized as a major challenge that needs to be addressed. Many experts believe that water (or the lack thereof) will be this century’s single biggest urban challenge. Already, many cities are struggling with drought. Others are depleting aquifers faster than they are being replenished. And as the world population swells and more people move to cities, the already strained water supplies could drain to critical lows. Compounding the problem, the city’s water infrastructure itself is often a huge source of waste. According to Schneider Electric, water systems typically consume half of a city’s energy. Further, they waste much of the water they are supposed to deliver. The American Water Works Association notes, “The U.S. water infrastructure breaks once each minute and about 540,000 times each year. The entire network is comprised of about 1.8 million miles of water distribution lines. Because of the age of the infrastructure, however, it leaks about six billion gallons of fresh water per day.” According to the Smart Cities Council (SCC), “a medium-sized city with 100 million gallons per day of produced water that loses 25 percent (not an unusual amount) is incurring over $13 million per year in non-recoverable labor, chemical and energy expenses.”

All of Dain Hansen’s full updates can be seen in their entirety in the RPA newsletter. Become a proud member of the RPA and reap the many benefits it provides for the radiant and hydronics industry. For more information, please visit https://www.radiantprofessionalsalliance.org/Pages/Join.aspx

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