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Education Construction Spending Is Up

January 22, 2018


The U.S. Census Bureau announced construction spending for November 2017 was up at a seasonally adjusted annual rate of $1,257.0 billion, 0.8 percent above the revised October estimate. It was also up 2.4 percent from November 2016, and during the first eleven months of this year, construction spending amounted to $1,138.3 billion, 4.2 percent above the $1,091.9 billion for the same period in 2016.

While private constructions spending was 1.0 percent above the revised October estimate of $955.1 billion; public construction spending was $292.7 billion which is up 0.2 percent above last month’s revised estimates of $292.0 billion.  

One of the main contributors to the public construction spending growth in November came from educational construction which was at a seasonally adjusted annual rate of $78.8 billion, 3.8 percent above the revised October estimate of $75.9 billion and up 12.0 percent from a year ago.

More information may be found at: https://www.census.gov/construction/c30/pdf/release.pdf

White House To Unveil Infrastructure Plan Come January 2018

December 19, 2017


According to White House Officials, President Trump is expected to unveil his infrastructure plan shortly after Republicans pass a tax reform bill, which the GOP hopes to have completed before the end of the year. Though specifics of the program are not yet known, the administration supposedly has developed a 70-page document that would serve as the guiding policy for the infrastructure legislation come January.

 D.J. Gribbin, the president’s adviser on infrastructure previewed a few details with an audience at the Hudson Institute on Dec. 12 affirming that states will be asked to invest heavily in projects of regional significance. Meaning if a state or local elected official would be willing to create a new revenue stream for infrastructure, the federal government, in turn, would partner with them in doing that. Gribbin also mentioned that the plan would accelerate the permitting process of construction projects and would pave the way for more toll roads.

The administrations’ 70-page document reportedly breaks down a 10-year, $200 billion plan meant to spark $800 billion in private sector investments. Federal dollars are expected to be put towards the nation’s roads and bridges, with a goal of generating the hundreds of billions more from local governments and private investors for U.S. road, rail, water and utility work.

 

Measuring Adequacy Of Retirement Income

November 22, 2017


In October, the Congressional Budget Office (CBO) released a report Measuring the Adequacy of Retirement Income; A Primer. Intended to explain the various measures and approaches that researchers apply today and to provide a framework for the additional analysis of adequate retirement income.

While the report focuses on the different measures and approaches; it did find that overall, across the studies, the share of current workers who were at risk of having inadequate income ranged from about one-third to two-thirds.

The report presented a framework for future analysis of the adequacy of retirement income and was prepared at the request of the Chairman of the Senate Committee on the Budget. As directed, the CBO’s report provides objective and impartial analysis but does not make any recommendations.

Here is a link to the report; https://www.cbo.gov/system/files/115th-congress-2017-2018/reports/53191-retirementadequacy.pdf

Pension Plan Limits For 2018 Tax Year Announced

October 25, 2017


THE IRS ANNOUNCED COST OF LIVING ADJUSTMENTS WHICH AFFECT DOLLAR LIMITATIONS FOR PENSION PLANS AND OTHER RETIREMENT-RELATED ITEMS FOR THE 2018 TAX YEAR.


Highlights:

  • The elective deferral (contribution) limit for employees who participate in 401(k) plans changes to $18,500.
  • The catch-up contribution limit for employees aged 50 and over who participate in 401(k) plans remains $6,000.
  • The total annual limit for contributions made to defined contribution retirement plans increases to $55,000.
  • The maximum compensation allowed to be used for retirement plan purposes increased from $270,000 to $275,000. 

 

Retirement Plan Limits for Plan Year

2018

2017

2016

401k Elective Deferrals $18,500 $18,000 $18,000
Catch-Up Contribution Limit $6,000 $6,000 $6,000
Annual Defined Contribution Limit $55,000 $54,000 $53,000
Annual Compensation Limit $275,000 $270,000 $265,000
Highly Compensated Employees $120,000 $120,000 $120,000
Top Heavy Key Employee Dollar Limit $175,000 $175,000 $170,000

Fringe Benefit Group Announces New Benefits Package Designed for Employers with Hourly Employees

October 16, 2017


Austin, October 16, 2017 – As the national debate on health care coverage continues, many employers are searching for group benefit plans with real-world cost control options. Fringe Benefit Group, an industry leader in the design, implementation and administration of benefit plans for hourly workers, offers affordable benefits to employers via The American Worker, a turnkey benefits platform utilized by many of the nation’s leading restaurant, retail, hospitality and staffing companies.

Fringe Benefit Group today announced it has launched The American Worker Triple Option plan, which consolidates fully insured fixed indemnity, self-funded Minimum Essential Coverage (MEC) and self-funded major medical insurance options into a single benefits package under one insurance/stop-loss policy. This allows employers to offer a wide variety of health insurance options to their diverse workforce with minimal administrative burden. Employers utilizing The American Worker Triple Option also have access to a wide range of specialty benefit options such as Dental, Vision, Short Term Disability and Life Insurance, which are tied into the platform’s payroll cycle billing administration.

For more than 30 years, Fringe Benefit Group has specialized in providing insurance for companies with hourly and part-time employees. Through its two national brands, The American Worker and The Contractors Plan, it works closely with more than 600 brokers across the U.S. to deliver benefit solutions to this unique market, which can be challenging to serve because of high turnover, geographically dispersed locations and difficult to reach employee populations. The American Worker Triple Option is designed specifically for employers with a contingent workforce and / or hourly employees, and allows employers to offer a broad range of benefit plans that provide employees with choices while allowing the employer to meet their Affordable Care Act (ACA) obligations.

“Fringe Benefit Group has a long and successful history of serving the diverse and sometimes challenging needs of hourly employees. We are very experienced with indemnity, MEC and major medical plans, and we are known for our outstanding customer service and administrative excellence,” said Jon Duczak, vice president, Fringe Benefit Group. “The American Worker Triple Option gives employers and their employees access to multiple products at multiple price points and lessens the administrative burden on employers. We know how to handle contingent workforce and hourly employees and are excited to help employers provide valued benefits to their entire workforce while reducing their administrative burden at the same time.”

As part of its focus on simplifying benefit plan administration and providing value to employers, Fringe Benefit Group offers an electronic platform that manages eligibility, payroll deductions and billing according to a client’s payroll schedule. The platform allows administration of benefit programs to occur on a weekly, bi-weekly and semi-monthly basis, which minimizes the hassles typically associated with monthly bill reconciliation and manual deduction processing.

About Fringe Benefit Group

Fringe Benefit Group and its affiliate companies have designed and administered programs that simplify the benefits process for employers with hourly workers since 1983. Through its nationwide network of independent brokers and agents, Fringe Benefit Group offers products from the industry’s leading carriers and is recognized for its full-service suite of tools and services designed specifically for employers with hourly and part-time workers. For more information, visit http://www.fbg.com/, http://www.thecontractorsplan.com/ or http://www.theamericanworker.com/.

 

 

 

Meeting Requested Seeking Progress Concerning Infrastructure Funding

October 3, 2017


Recently, Democrat Senator Sheldon Whitehouse, along with the other minority members of the Environment and Public Works (EPW) Committee launched efforts to gain bipartisan backing for infrastructure spending and improvements.

Democrats on the EPW Committee sent a letter Secretary of Transportation (DOT) Elaine Chao requesting a meeting where she and other Administration officials could share progress on the Administration’s infrastructure investment plan.

The letter highlighted Chao’s confirmation-hearing promise to work in bipartisan fashion in delivering on Trump’s campaign promise.  It also emphasized that they hoped Chao would be able to formally transmit the Administration’s plan to Congress promptly so that they may understand the “priorities as we get to work on developing a comprehensive infrastructure investment package.”

The letter to Secretary Chao can be viewed at:

https://www.epw.senate.gov/public/_cache/files/1/d/1df2752f-481a-49b2-875d-7ccc1555a416/6E0168651F034E5BB8C87EDF9F5A3C08.epw-minority-asks-secretary-chao-for-details-on-trump-administration-s-long-awaited-infrastructure-plan.pdf

Applying The New Fringe Rate To Existing Contracts

August 10, 2017


Since the release of All Agency Memorandum Number 225 on July 25, 2017, which provides the annual update of the Service Contract Act Health and Welfare Fringe Benefit, we have received several questions regarding the proper method to apply this change to existing contracts. Unfortunately, no additional information was provided in AAM No. 225 to explain how this rate change is applied other than to say, “Effective August 1, 2017, the SCA health and welfare benefit rate of $4.41 per hour will be posted on the Wage Determination Online and Wage and Hour Division (WHD) websites”.

However, on August 1st the Wage Determination Online website started posting updated wage determinations which include the new fringe rate. These rates do not apply until the new wage determination is modified to the contract.

The process of modifying existing contracts should be initiated by the contracting agency and is covered by the Federal Acquisition Regulation (FAR) 52.222-43, Fair Labor Standards Act and Service Contract Labor Standards – Price Adjustment (Multiple Year and Option Contracts)

You can read more about this here: https://www.law.cornell.edu/cfr/text/48/52.222-43.

This FAR section applies to firm-fixed price and labor-hour contracts. The adjusted price must reflect the change in the updated wage determination. The adjustment occurs on the anniversary date of multiple year contracts or at the beginning of the renewal option period, but the process is initiated by the contracting agency early enough to be accomplished prior to these dates.

If you have any questions regarding a Service Contract Act price adjustment on a specific contract, the best place to start is with the contracting agency.

There are also several good references, in addition to the Federal Acquisition Regulation, that can help explain the process including:

Labor Secretary Reinstates Wage And Hour Opinion Letters

July 17, 2017


Labor Secretary, Alexander Acosta recently announced that the Department’s Wage and Hour Division (WHD) would reinstate the issuance of opinion letters as one of their means of guiding covered employees and businesses. The action restores the WHD’s long-standing practice of releasing opinion letters regarding the application of the Fair Labor Standards Act and its implementing regulations. 

For more than 70 years’ opinion letters had been a common practice for the WHD, but in 2010 they were replaced with “general guidance” which was intended to provide a broader administrator interpretation. Secretary Acosta has been a firm advocate of returning to the use of opinion letters, believing that they will benefit the employees and employers by providing a clearer understanding of Wage and Hour requirements.

Opinion letters are an official, written notice by the WHD of how a specific law applies in particular circumstances submitted by an employer, employee or other entity requesting the opinion. The WHD has a dedicated web page (https://www.dol.gov/whd/opinion/) that the public may use to see if agency guidance already exists that address their question or where a request can be submitted.

 

Trump Issues An Executive Order Expanding Apprenticeships

June 20, 2017


President Trump issued an Executive Order (EO) earlier this month, expanding apprenticeships in America by reducing regulations that often prevent businesses from creating apprenticeship programs. At the signing of the EO, Trump stated that he hopes to “expand apprenticeships and vocational training to help all Americans find a rewarding career, earn a great living, and support themselves and their families.”

For the purpose of this EO, the definition of apprenticeship is an arrangement that includes a paid-work component and an educational or instructional component designed to provide workers with workplace-relevant knowledge and experiences that offer affordable paths to employment. Also, funding will be granted to support apprenticeship programs across different industries, including the development of apprenticeship participation between students at educational institutions.

A primary aspect of the EO is to evaluate whether an apprenticeship system might help other businesses bridge skills gaps and deliver good-paying jobs as they have done in the construction industry. To determine this, the EO calls for the establishment of a Task Force on Apprenticeship Expansion that would recommend where to expand apprenticeships programs and also ascertain methods to improve or eliminate those programs that are currently insufficient.

The Task Force, who will be led by the Secretary of Labor in conjunction with the Secretary of Education and Commerce, will establish industry-recognized apprenticeships and propose regulations, consistent with the applicable law that encourages the development of apprenticeship programs by third parties.  Before any final regulations are issued, the Labor Secretary shall consider and evaluate public comments on any regulations proposed under this EO.

Update: Infrastructure Initiative

June 5, 2017


At the end of May, the proposed 2018 United States federal budget was released and incorporates $200 billion in outlays over ten years linked to the President’s infrastructure initiative. The funding proposes to use the $200 billion to leverage $1 trillion worth of overall investment and is intended to address a broad range of transportation projects, as well as the construction of veterans hospitals, and energy and broadband improvements.

Though the budget does not specify complete plan details, it does say it intended to use a combination of funding options that include federal investments, new financing tools that foster private investment, and the reforming of regulations to help expedite the approval process and construction timelines. The focus of the federal investments is expected to be on the most transformative projects; giving high priority to those projects leading to a long-term change in infrastructure improvements.

Part of the new funding looks to support better infrastructure decisions by using federal capital revolving funds and partnership grants for federal assets. Also, the new federal spending hopes to motivate private companies and state and local governments to scale up their spending many times over.

The president is expected to make several public speeches in the next few weeks which may offer more details about the possible implementation of the infrastructure initiative. As for congressional support of the budget and plans, that remains to be determined. Spending on roads and construction has been something that both parties seem to back as a good idea, but how to pay for it may overtake the bipartisan interest in getting something accomplished.