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Utility Contractors Association of
New England, Inc.
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Legislative Update | June 2012 |
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 Massachusetts' Highest State Court:
"Let the Town Decide"
The Massachusetts Supreme Judicial Court (SJC) recently entered a finding in Barr Inc. v. Town of Holliston in the beginning of May. The case stemmed from the Town's solicitation of bids for the construction of a new police station. While Barr Inc. submitted the lowest bid, the Town, as a result of research it conducted on its own, determined that Barr was not a "responsible and eligible bidder". As such, the Town decided that the contract should instead be awarded to the next-lowest bidder. As Mass. Gen. Laws ch. 149, 44A(2)(D) provides that contracts for the construction of public buildings estimated to cost above $100,000 "shall be awarded to the lowest responsible and eligible general bidder", the lowest submitted bidder, Barr, challenged the Town's decision.
After winding its way through the court system, the matter found itself before the SJC as a unique question of law. The key issue: whether an awarding authority is constrained to look only at materials compiled as part of the Department of Capital Asset Management's (DCAM's) contractor certification process. In answer, the SJC concluded that the competitive bidding statute placed no such restriction on awarding authorities. As well, the SJC found that DCAM's certification file need include only a "representative sample" of a contractor's public sector projects, and will not necessarily reflect performance in any of the contractor's private sector work. 810 Code Mass. Regs. § 4.06(2). Accordingly, DCAM's certification file may exclude a significant portion of the work history of contractors with extensive experience, or with experience primarily in private sector construction projects. Awarding authorities should not be precluded from assembling a more complete picture of a contractor's qualifications than that available from the certification file and update statement alone. Therefore, the SJC could not conclude that the Town exceeded its statutory authority by conducting an investigation into Barr's performance in past projects.
To review this opinion in more detail, please visit: http://www.suffolk.edu/sjc/archive/opinions/SJC_10899.pdf.
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Massachusetts House of Representatives Passes Economic Development Legislation
The Massachusetts House recently passed legislation implementing strategically-focused economic development policies aimed at making Massachusetts more competitive by improving the Commonwealth's innovation economy, promoting economic prosperity through infrastructure investments and streamlined permitting, facilitating the expansion of new and existing businesses, and training for the Commonwealth's workforce in the future.
To that end, the legislation makes investments in infrastructure through the statutory creation of the MassWorks Infrastructure Program, which currently serves as a one-stop-shop for infrastructure funding under executive order. Additionally, given the recent interest in Boston's Innovation District, the legislation makes more funding available for project financing via the I-cubed program.
In an effort to further strengthen the innovation economy in Massachusetts, the legislation creates an Innovation Investment Fund and the Talent Pipeline Program. The Innovation Investment Fund, which will offer matching grants to research and development projects is sponsored by the state's universities and research institutions. The Talent Pipeline Program will allow students to access matching stipends for internships at technology and innovation start-ups. As a final "employee training mechanism", the legislation provides for a recapitalization of the Workforce Competitiveness Trust Fund with a focus on "middle skill" jobs through collaboration between public educational institutions, workforce investment boards, and local employers.
With respect to municipal level projects, the legislation encourages economic growth by expanding expedited local permitting, which will enable communities to use the Chapter 43D local option program to promote residential development in addition to commercial and mixed-use development that are currently allowed by law. To further assist small business, the legislation directs the Treasurer to invest at least $100 million in institutions that make capital available to small businesses and early-stage companies.
Other provisions of the bill include:
- Creates a new Local Infrastructure Development Program that gives municipalities a new tool for leveraging private funding to finance infrastructure improvements needed to support economic development projects;
- Establishes a Massachusetts Creative Economy Network tasked with creating a mentoring network, developing certification for creative economy businesses and attracting private investment to creative economy businesses;
- Streamlines the Economic Development Incentive Program, simplifying the program for municipalities and businesses seeking tax credits while maximizing the program's efficiency;
- Changes District Improvement Financing making it easier for cities and towns to use;
- Extends Brownfield tax credits for two additional years (until 2015);
- Extends for another two years state and local permits held by any developer who has been unable to proceed with their project because of tight credit markets;
- Increases the annual cap on the state Historic Rehabilitation tax credit from $50 million to $60 million;
- Transfers $4 million from one-time settlements to the Rainy Day Fund to go to the Smart Growth Housing Trust Fund;
- Provides $250,000 for a competitive grant program through the Small Business Association of New England that averts layoffs at manufacturing companies;
- Creates a Manufacturing Grant Program that will support small and mid-sized enterprises;
- Creates a Community Investment Tax Credit Program that seeks to promote long-term public/private partnerships at the community level by providing a special donation tax credit for contributions made to selected community improvement efforts.
The legislation was passed unanimously in the House by a vote of 150-0. It remains to be seen when the Massachusetts Senate will consider the same legislation.
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Senate Passes Fiscal Year 2013 Budget
The Massachusetts Senate, after adding $74 million in spending initiatives over two-plus days, unanimously approved a $32.4 billion FY 2013 budget at the end of May. This year's Senate deliberations saw debate focused mostly on policy plans rather then spending. Among other items, the Senate added budget riders imposing checks on executive compensation at mutual holding companies, requiring employers to comply with new verification checks on workers' legal status, and enabling state residents to take advantage of discounts and coupons offered by drug companies.
Among items of interest for UCANE members, the Senate provided $350,000 for the development of a wastewater smart map and cost model for the Cape Cod region to identify environmentally appropriate and affordable wastewater infrastructure solutions, according to a press release. According to Senate President Therese Murray the funding will "allow the Cape to take the next step in finding a solution to the region's wastewater problem." The comprehensive model will identify the appropriate economy of scale for wastewater infrastructure solutions and provide estimates of the costs associated with implementing various solutions. The model will be accessible to the public through a web mapping application and, under accompanying language, must be completed by June 30, 2013.
Other items of interest included in the Senate FY 2013 budget were:
- Fully funding anticipated costs of the state's Special Education Circuit Breaker, estimated at $242.2 million.
- Complying with Chapter 70 funding for schools by providing $145 million in new aid to ensure that each school district receives sufficient aid to meet its foundation budget.
- Providing an additional $13 million in Chapter 70 aid to ensure that all school districts receive at least an additional $40 per pupil in aid over and above FY 2012.
- Finally, providing $900 million in unrestricted aid to municipalities. This funding level builds in both the $834 million appropriated in the FY 2012 budget as well as the $65 million supplemental local aid payment made through FY 2011 reserves.
With the House having completed its budget in April, a conference committee has been appointed by each branch to align the competing budget versions. On the House side, Reps. Brian Dempsey (D-Haverhill), Stephen Kulik (D-Worthington) and Viriato DeMacedo (R-Plymouth) were named as its budget negotiators. Accordingly, the Senate appointed Sens. Stephen Brewer (D-Barre), Jennifer Flanagan (D-Leominster) and Michael Knapik (R-Westfield). The six-member conference committee has less than four weeks to agree on a final budget and settle myriad policy and spending differences as the new fiscal year begins on July 1.
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Administration Releases Annual Performance Report on Green Communities Act
At the start of June, Massachusetts Energy and Environmental Affairs Secretary Rick Sullivan announced 24 municipalities that have completed energy efficiency and clean energy projects under the Green Communities program. The investments range from lighting upgrades in schools and public buildings to solar installations.
The findings follow a major energy policy address by Governor Patrick and were part of the Department of Energy Resources Green Communities Division's annual report to the Legislature, which shows an increase of 33 more municipalities participating in the program since the agency's 2011 report.
The communities with completed projects include: Acton, Andover, Arlington, Belchertown, Cambridge, Chelmsford, Easthampton, Greenfield, Hamilton, Holyoke, Hopkinton, Kingston, Lexington, Lincoln, Lowell, Mashpee, Medford, Montague, Northampton, Pittsfield, Springfield, Sudbury, Swampscott and Wenham.
Since the Green Communities program started in 2009, nearly half of Massachusetts' residents now live in a "Green Community". Overall, this represents 86 communities representing 42 percent of the population or 2.7 million residents. These communities, from Pittsfield to Provincetown, have committed to cutting municipal energy consumption by 20 percent. According to the Massachusetts Department of Energy Resources, the commitment equates to the annual energy consumption of more than 13,000 Massachusetts homes and the greenhouse gases from more than 16,800 cars.
For more information about the Green Communities program, please visit: http://www.mass.gov/eea/energy-utilities-clean-tech/green-communities/.
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Governor Signs VALOR Act in an Effort to Increase Opportunities for the Commonwealth's Veterans
With approximately 385,000 veterans living within the Commonwealth, Governor Deval Patrick recently signed Senate Bill 2254, "An Act Relative to Veterans' Access, Livelihood, Opportunity, and Resources", also known as the VALOR Act. The legislation creates increased supports for veteran-owned businesses, Gold Star Families, military children and higher education access in the Commonwealth.
Among other provisions, the VALOR Act provides greater access to financial assistance for small businesses; affords greater opportunities for service-disabled veterans to participate in public projects; makes it easier for children of military personnel to transfer between school districts and states; and expands support from the Massachusetts Military Family Relief Fund to Gold Star Families. The relief fund, which derives its funding from a voluntary tax check off on income tax returns, will be used to defray the costs of food, housing, utilities, medical service and other expenses borne by Massachusetts National Guard and reserve service members and their families.
Under the VALOR Act, Massachusetts will also join other states as part of the Interstate Compact on Educational Opportunity for Military Children. The Compact is intended to be a tool for schools to make transition easier for the children of military families so that they are afforded the same opportunities for educational success as other children and are not penalized or delayed in achieving their educational goals. The average military student faces transition challenges more than twice during high school, and most military children will attend six to nine different school systems from kindergarten to 12th grade.
The VALOR Act also calls for the state Board of Higher Education to require each public institution of higher education to develop a set of policies and procedures governing the evaluation of a student's military occupation(s), military training, coursework, and experience, in order to determine whether academic credit shall be awarded for such experience, training, and coursework. The policy must be in place by March 1, 2013.
The VALOR Act also streamlines the process for school-aged children of military personnel to transfer between school districts and states; prohibits local hiring authorities from requesting any military medical records that are not requested by the Human Resources Department; and eliminates the $2,500 cap that applies to years six and beyond of the property tax exemption for surviving spouses of a soldier, sailor, or member of the National Guard whose death occurred as a proximate result of an injury sustained or disease contracted in a combat zone.
To learn more about resources and services for Massachusetts veterans and military families, visit the Massachusetts Department of Veterans' Services: www.mass.gov/veterans or visit the new web portal: www.MassVetsAdvisor.org.
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Massachusetts Lottery Continues to Break Records
With two months of receipts yet to be calculated, the Massachusetts State Lottery has collected more than $250 million in additional sales revenue above last year's total. Strong sales of scratch tickets and a 1.1 percent drop in overall prize payouts for the year had increased the Lottery's net profit for the year by $92.5 million through April. The Lottery has paid out 71.3 percent of its nearly $4 billion in revenue, compared to 72.4 percent last year. For purposes of comparison, April Lottery sales beat April 2011 sales by $30 million. Despite March's Mega Millions jackpot, which climbed close to $650 million, the game did not offset its overall decline as sales are still down $3 million on the year, or 3.4 percent. Instant ticket sales are up $194 million, or 7.7 percent from last year, driven in part by the popularity of the regional "For Life" suite of tickets that offer prizes of $500 to $5,000 a week for life. Those tickets sold throughout New England have generated $182 million in sales since being introduced Feb. 21. The Lucky for Life instant drawing has generated over $8 million in its first months of operation. The Lottery plans to roll out four new instant tickets on June 12 with $173.25 million in cash prizes, including a new $5 ticket called Double Platinum Payday that has a grand prize of $1 million.
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Please forward a copy of this month's Legislative Update (which appears in this month's issue of Construction Outlook Magazine) to the key people in your company for their review.
Sincerely,
Anne Klayman
UCANE |
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