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Highlights:
San Antonio Idle Equipment Rally
01/20/10
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Terex Supports Highway Bill
12/16/09
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Highlights:
Washington D.C. Idle Equipment Rally
10/28/09
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Rep. James Oberstar (D-MN)
Chairman
House Transportation
& Infrastructure Committee
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Toby Mack
President and CEO
Associated Equipment Distributors
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Dennis Slater
President
Association of Equipment Manufacturers
and
Toby Mack
President and CEO
Associated Equipment Distributors
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Jonathan Miller
VP of Government Relations
Volvo Group North America
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Dennis Slater
President
Association of Equipment Manufacturers
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Highlights:
Chicago Idle Equipment Rally
10/20/09
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Toby Mack
President and CEO
Associated Equipment Distributors
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Diane Benck
Vice President
West Side Tractor Sales Co.
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Jerry Roper
Chicagoland Chamber of Commerce
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Dennis Gannon
Chicagoland Federation of Labor
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Darick Franzen
Plote Construction Inc.
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Dennis Slater
President
Association of Equipment Manufacturers
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Toby Mack
President and CEO
Associated Equipment Distributors
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MaryKaye Cashman
CEO
Cashman Equipment
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Dennis Slater
President
Association of Equipment Manufacturers
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Randy Highland
President
Associated General Contractors
Las Vegas Chapter
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Terry Jicinsky
Senior Vice President of Operations
Las Vegas Convention
and Visitors Authority
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Idle Equipment Rally
Las Vegas, NV
9/29/09
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Start Us Up USA! Launches Infrastructure Campaign Pledge
AED and AEM have launched an effort to get U.S. House and Senate candidates from across the country to commit to making surface transportation and water infrastructure investment a top priority in the next Congress. The pledge gives them the opportunity, if elected, to publicly commit to supporting robust federal investment in surface transportation and water infrastructure programs. Such programs would create jobs, spur economic growth, ensure the country’s global competitiveness, protect public safety and the environment, and create a better quality of life for every American. For more information about the pledge campaign visit www.startusupusa.com/pledge.
To view the press release regarding the effort click here
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AED Chair Testifies Before Two Congressional Committees on Equipment Industry Recovery Agenda
AED 2010 National Chairman Dennis Vander Molen, president and general manager of Vermeer MidSouth, appeared before two U.S. House of Representatives' committees on key parts of the equipment industry recovery agenda.
Vermeer MidSouth is an authorized distributor of Vermeer construction equipment and operates seven locations in Mississippi, Tennessee, Arkansas, and Louisiana.
"The economic recession has been a construction equipment industry depression," Vander Molen said. "We need to keep up the drumbeat and tell Congress what it's going to take to help equipment distributors and manufacturers once again grow and prosper."
On July 14, Vander Molen testified before the House Small Business Committee about the importance of renewing the depreciation bonus. This capital investment incentive, which expired at the end of 2009, allows businesses to immediately write off 50 percent of the cost of depreciable property. AED is leading a coalition that is urging Congress to reinstate the temporary tax incentive for at least one year to encourage business purchasing.
In his remarks, Vander Molen told committee members that reinstating the depreciation bonus "will encourage companies to invest in newer, more efficient equipment, help the construction equipment industry recover from its current depression, promote broader economic recovery, improve cash flow for large and small companies, and, arguably most importantly, create well-paying jobs in the near term."
Vander Molen appeared before the House Transportation & Infrastructure Committee's Subcommittee on Water Resources & Environment on July 15, and spoke about the economic benefits of water infrastructure investment. AED estimates that 12 cents of each dollar spent to build sewers and drinking water systems are used by contractors to buy, rent, and service equipment.
"Our nation faces an unparalleled infrastructure crisis. Immediate and aggressive congressional action is necessary to ensure that our water infrastructure does not deteriorate further and that states and localities have the resources they need to address the crisis. The problem will only be more expensive to solve as time goes on," Vander Molen told the subcommittee members.
Vander Molen's testimony at both hearings emphasized the importance of these issues to the equipment industry's economic recovery. According to IHS Global Insight, spending on construction machinery fell 50 percent during the recent recession, forcing equipment manufacturers, distributors, and maintenance providers to shed 257,000 jobs, 37 percent of the industry's workforce. By taking action in these two areas, elected officials can reverse this trend and create jobs by stimulating the purchase of new equipment and creating opportunities to put that equipment to work through new water infrastructure projects.
To view Vander Molen's testimony before the Small Business Committee visit the committee's You Tube page. Visit here to read his prepared remarks before the committee.
View a summary of the issue and video of Vander Molen's testimony at the Water Resources & Environment Subcommittee's Web site. Visit here to read his prepared remarks before the subcommittee.
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AED and AEM Urge Senators to Devote All Revenues Raised from the Transportation Sector in Energy and Climate Change Legislation to the Highway Trust Fund
On June 8, AED President and CEO Toby Mack and AEM President Dennis Slater sent a letter to all U.S. Senators, in advance of the chamber’s anticipated consideration of energy and climate change legislation, urging Congress to devote all revenues collected from any “climate fee” on the transportation sector to the Highway Trust Fund “to support comprehensive surface transportation improvements.”
To view a copy of the letter CLICK HERE.
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Iowa Equipment Industry Tells Congress to Start Us Up USA!
Against a backdrop of construction machinery idled by the economic downturn, Iowa equipment distributors and manufacturers rallied on May 7 at the Iowa state capitol building to urge Congress to pass a new multi-year highway law. The event, organized by the Iowa Nebraska Equipment Dealers Association (INEDA), is part of Start Us Up USA!, a national grassroots campaign by Associated Equipment Distributors (AED) and the Association of Equipment Manufacturers (AEM).
AED and AEM launched the campaign last summer to highlight dismal economic conditions in the equipment industry and urge Congress to enact legislation to support the industry's recovery. Since 2007, the industry has lost 37 percent of its workforce and spending on construction equipment has fallen 50 percent nationwide.
Uncertainty surrounding the federal highway program is contributing to historic volatility in equipment markets. SAFETEA-LU, the most recent highway law, expired at the end of September and neither the House of Representatives nor Senate has passed legislation to reauthorize the program. The equipment industry is urging Congress to quickly enact a new multi-year spending blueprint that dramatically increases highway and bridge investment.
"Without a new authorization law, states can't plan major new projects and contractors don't know how much work they'll have, which means they're not buying equipment," AED President & CEO Toby Mack said. "A new highway law is critical to restoring certainty to construction markets and turning the equipment industry around."
Several leading Iowa equipment dealers and manufacturers provided equipment and other support for the event. The rally was endorsed by the Asphalt Paving Association of Iowa, Associated General Contractors of Iowa, the Iowa Concrete Paving Association, Iowa Good Roads Association, Iowa League of Cities, Iowa Limestone Producers Association, Iowa Ready Mixed Concrete Association, Iowa State Association of Counties, Iowa State Association of County Supervisors, and Land Improvement Contractors of America. U.S. Representatives Tom Latham (R-IA) and Leonard Boswell (D-IA) also participated.
The event in Des Moines was the fifth Start Us Up USA! rally to date. Since September, the equipment industry has also held events in Las Vegas, Chicago, Washington, D.C., and San Antonio.
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80 National Groups Join AED and AEM Urging Depreciation Bonus Reinstatement
On April, AED and AEM were joined by 80 other national organizations urging Congress to reinstate the expired depreciation bonus. The tax incentive, created as part of the 2008 Economic Stimulus Act and extended by the 2009 American Recovery and Reinvestment Act, allows companies that buy new equipment to cut their tax bills by writing off 50 percent of the cost in the first year. The depreciation bonus expired on Dec. 31, 2009.
In a letter to Congress sent last Thursday, AED, AEM, and its allies told lawmakers that, “Reinstating bonus depreciation will help inoculate the economy against a backward slide in business capital investment in the months ahead, enhance the impact and benefits of other job creation legislation (e.g., infrastructure investment), encourage recovery in fragile, capital-intensive sectors of the economy (e.g., construction and manufacturing), and, most significantly, put Americans back to work.” To view a copy of the letter, please click here
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AED and AEM Urge President Obama to Make Highway Reauthorization a Priority
On March 4, AED President and CEO Toby Mack and AEM President Dennis Slater sent a letter to President Obama urging him to direct his administration “to begin working with the Congress to develop and pass – in 2010 – a fully funded, multi-year reauthorization of the federal surface transportation programs.” To view a copy of the letter, please click here.
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Senate Bill Extends Highway Programs through 2010
On Wednesday, Feb, 24 by a vote of 70-28 the Senate passed the Jobs Bill that seeks to extend highway programs through Dec. 31, 2010. It is unclear at this time how the Senate bill will be reconciled with a much larger House-passed jobs bill, but a merging of the two bills is expected to happen quickly. The Start Us Up USA! Campaign's focus will now be to make this a "meaningful extension" during which work begins on a fully-funded, multi-year reauthorization and is completed before year's end.
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AED, AEM Joined By 39 Other National Organizations To Urge Extension Of Recently Expired Business Purchasing Tax Incentives
On January 29, AED and AEM were joined by 39 other national organizations representing the agriculture, distribution, construction, manufacturing, energy, aviation, and professional services sectors in calling on Congress to support a proposal mentioned in President Obama’s State of the Union speech to “provide a tax incentive for all large businesses and all small businesses to invest in new plants and equipment.” The letter urges Congressional leaders to extend recently expired business purchasing tax incentives included in last year’s economic stimulus legislation. The American Recovery and Reinvestment Act (ARRA) allowed businesses to write off 50 percent of new equipment purchases and permits qualified small businesses to expense up to $250,000. The depreciation bonus and increased small business expensing provisions were included in the ARRA to encourage companies to make new capital investments in 2009. Both incentives expired at the end of last year.
In the letter, the coalition said, “Bringing back accelerated depreciation and higher Sec. 179 expensing levels would help inoculate the economy against a backward slide in business capital investment in the months ahead and enhance the impact and benefits of other job creation legislation (e.g., infrastructure investment). Doing so would also encourage businesses to invest in newer, safer, more efficient, and more environmentally-friendly equipment, which will have additional societal benefits.” To view the full text of the letter, please click here.
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San Antonio Equipment Distributors Tell Congress: Get to Work on the Highway Bill So WE Can Get Back to Work!
SAN ANTONIO January 20, 2010 – Congress’ failure to renew the federal highway program has real economic consequences for Texas and the rest of the country, construction equipment industry leaders said at a rally today at the Henry B. Gonzalez Convention Center.
The event was part of a national grassroots campaign called Start Us Up USA! by Associated Equipment Distributors (AED) and the Association of Equipment Manufacturers (AEM), the nation’s two leading equipment industry trade groups.
Following the rally, a caravan of trucks carrying large pieces of construction equipment idled by the industry depression and draped with banners made its way through the streets of downtown San Antonio.
AED and AEM are seeking to draw attention to the economic crisis facing construction equipment distributors and manufacturers, as well as the consequences of Congress’ failure to reauthorize federal highway and transit programs. According to a recent study by IHS Global Insight, since 2006 the U.S. equipment industry has lost 37 percent of its workforce and 40 percent of its economic output. All indications are that construction industry business conditions are getting worse and what is happening – or is not happening – in Washington, D.C., is only adding to the misery.
SAFETEA-LU, the most recent federal surface transportation law, expired at the end of September. Distracted by health care reform and climate change legislation, neither the U.S. House of Representatives nor the Senate has made headway on a reauthorization bill. As a consequence, the highway program is operating under a series of short-term extensions that have added to historic volatility in the construction markets.
“States can’t plan and contractors don’t know how much work will be coming down the pike,” AED President & CEO Toby Mack said. “As a result, they’re sitting on their hands and not investing in new equipment. That’s killing our industry.”
“We’re not asking for a handout like the ones Congress gave the auto industry or the financial services sector,” AEM President Dennis Slater said. “We’re just asking Congress to do its job and make highway reauthorization a priority.”
Bennett Closner, president and CEO of Closner Equipment Co., Inc., a San Antonio dealer, provided a local perspective on the national crisis. Closner, who is the 2009 national chairman of AED, said that since 2006 Texas has lost more than $11 billion in economic activity because of the equipment industry downturn, the biggest loss of any state. And Texas is second only to California in equipment industry-related job losses, with more than 53,000 layoffs in three years.
“I’ve listened to friends and colleagues agonize over the difficult decisions they’ve had to make about their businesses. Almost all have had to lay off valued workers, many have closed one or more of their facilities, and some companies have shut their doors altogether after several generations in business,” Closner said.
Allyn Archer, President and COO of San Antonio-based Holt CAT, told rally attendees that local equipment dealers have experienced a 70 percent drop in new machine sales from 2008 levels. He said that the most debilitating impact of the downturn for his company has been a 25 percent reduction in employment.
“Our remaining employees have made sacrifices in pay and benefits to enable us to stay profitable, and plans for several new store locations were canceled,” Archer said.
According to Archer, the economic crisis and uncertainty surrounding the highway bill are also taking a massive toll on local contractors. “Our customers who do highway construction have laid off thousands of employees. Many contractors are still reducing their workforces and their equipment fleets. The rapid drop in value of used equipment has also had a drastic affect on the equity of most contractors, resulting in a reduction of both borrowing and bonding capacity,” he said.
Other speakers at the rally included Texas State Senator Jeff Wentworth (R-District 25); Dean Word, III of Dean Word Company (New Braunfels); and Craig Paylor, president of JLG Industries, a manufacturer of mobile aerial work platforms based in Maryland. They pointed to the broad social and economic consequences of infrastructure investment, or rather Congress’ failure to invest enough.
According to the Texas Transportation Institute (TTI), traffic congestion costs the country $87 billion per year in wasted time and fuel. TTI reports that, on average, San Antonio commuters waste 27 gallons of fuel and 38 hours per year sitting in traffic. A study last year by the Transportation Construction Coalition found that road conditions are a contributing factor in more than half – 52.7 percent – of the nearly 42,000 American deaths resulting from motor vehicle crashes each year. Accidents in which road conditions were a factor cost Texas more than $13 billion in 2006.
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House Extends Highway Bill…Again!
On Wednesday, Dec. 15, the House passed a two-month extension of the highway bill, which was set to expire today; the next expiration date is Feb. 28, 2010. It is unclear what action Congress will take on the highway bill in that two-month period, but the most likely scenario is another extension, as policy issues and the question of the program’s funding mechanism remain unresolved. A further extension, through the end of 2010, was included in another House-passed measure, the “Jobs for Main Street “proposal that, among other things, would provide $48 billion in new federal infrastructure investments. The package contains $27.5 billion for highways, $8.4 billion for transit, $800 million for Amtrak, $500 million for airports, $100 million for ship construction and $11 billion in other infrastructure investments (including Corps of Engineers activities). These funds are in addition to the federal investments already set for the core federal transportation programs in FY 2010. However, as it remains mired in health care reform, the Senate will not consider the jobs bill until after the first of the year.
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Terex Hosts Transportation Committee Chairman
On November 30, Terex welcomed Congressman Jim Oberstar (D-MN), chairman of the House Transportation & Infrastructure Committee, for discussions and a facility tour at its compact equipment manufacturing facility in Grand Rapids, MN. The visit, an invitation from Terex, provided both an opportunity for the Congressman to learn more about construction equipment made in his District and for Terex to thank him for his leadership in seeking reauthorization of the Highway Bill, which, again, expires Dec. 18 without further Congressional action.
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AED, AEM Joined By 30 Other National Organizations To Urge Extension Of Business Purchasing Tax Incentives
On December 2, AED and AEM were joined by 30 other national organizations representing the construction, manufacturing, aviation, professional services, and distribution sectors in calling on Congress and President Obama to extend business purchasing tax incentives included in the economic stimulus legislation. The American Recovery and Reinvestment Act (ARRA) allows businesses to write off 50 percent of new equipment purchases and permits qualified small businesses to expense up to $250,000. The depreciation bonus and increased small business expensing provisions were included in the ARRA to encourage companies to make new capital investments in 2009. Both incentives expire at the end of the year.
In a letter to congressional leaders and the White House, the coalition said that while the depreciation bonus and increased small business expensing levels have had a positive impact, “the depression in capital-intensive sectors of the economy (e.g., construction and manufacturing), lack of access to credit, and general uncertainty about the future of the economy have combined to prevent many businesses from taking advantage of the law and the incentives have not had the chance to fully achieve their intended effect.” To view the full text of the letter please click here.
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Construction Unemployment Hits 19.4%
Overall unemployment unexpectedly fell two-tenths of a point to 10 percent in November. However, unemployment in the construction industry increased seven-tenths to a new high of 19.4 percent. This perfectly illustrates the Start Us Up USA! campaign’s message that the construction equipment industry is being left behind in the economic recovery. How high does the construction unemployment rate need to be before Congress acts?
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AEM and AED Weigh In on White House Jobs Forum and Developing Jobs Bill
House and Senate Democratic leaders are developing new legislation, likely slated for enactment in January, intended to address the dismal U.S. unemployment numbers and stimulate job creation. Taking the lead in the Senate are Majority Whip Dick Durbin (D-IL) and Democratic Policy Committee Chairman Byron Dorgan (D-ND); Majority Leader Steny Hoyer (D-MD) and Education and Labor Committee Chairman George Miller (D-CA are on point in the House. As part of the Start Us Up USA! campaign, AEM and AED have met with these and other leading lawmakers, urging Congress for months to pass the highway bill reauthorization as it represents the best real, near-term and sustainable jobs creation opportunity. AEM and AED aggressively delivered this message in discussions with White House staff prior to the White House Jobs Forum held on Dec. 3, and on Dec. 4, and again went on record with a letter to the congressional leaders, reemphasizing the critical need to make transportation infrastructure investment a major element of their bill.
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AED and AEM Deliver Congress Orange Flags and Warn of Job Losses Ahead
On November 11, AED and AEM warned Congress that that the economy will shed more jobs in the coming months unless lawmakers swiftly enact a new multi-year highway law. The warning came in the form of orange flags sent to every member of Congress as part of the Start Us Up USA! campaign. The flags were accompanied by details of a recent IHS Global Insight economic report that found the equipment industry had lost 37 percent of its workforce in the last three years, the equipment industry downturn had cost 550,000 jobs nationwide, and equipment sales had declined 50 percent since 2006.
The orange flag has become a symbol of Start Us Up USA!, to draw attention to the equipment industry economic crisis. In conjunction the recent Washington, D.C., rally and idle construction equipment caravan through the streets of the nation's capital, the AED and AEM planted 5,500 orange flags in the National Mall – one for each 100 jobs lost since 2006 as a result of the downturn in the equipment industry. To read the full press release, please click here.
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Two Pieces of Start Us Up USA! Equipment Recovery Agenda Become Law
Last week, the Associated Equipment Distributors (AED) and Association of Equipment Manufacturers (AEM) scored two major victories as key parts of the Start Us Up USA! equipment industry recovery agenda were passed by Congress and signed into law by President Obama as part of legislation to extend unemployment benefits by four months.
The legislation included the extension and expansion of two tax provisions from the American Recovery and Reinvestment Act (“ARRA” or “the stimulus bill”) relating to net operating loss (NOL) carry back and home purchase tax incentives.
Under the new law, companies of any size are permitted to carry back NOLs from 2008 or 2009 (not both) for up to five years (ARRA limited NOL carry back to businesses with less than $15 million in revenue.) Companies that already took advantage of NOL carry back provision from ARRA for 2008 may also benefit from the new law for NOLs from 2009. The new NOL law will help free up cash for struggling distributors and manufacturers.
In addition to the NOL carry back provision, the new law extended and expanded the successful home purchase tax credit from ARRA which is set to expire on Dec. 1. First-time home buyers may now take advantage of an $8,000 credit until May 1, 2010 (buyers must enter a binding contract before May 1 and close by July 1). The residence must be purchased for less than $800,000.
The new law also raises the income limits for those eligible to take advantage of the home purchase tax credit to $125,000 individuals or $225,000 for couples. Additionally, people who have lived in their current home for at least five years would also become eligible for a new $6,500 tax credit if they buy a new house. AED and AEM believe that the expanded home purchase tax credit will encourage further recovery in the residential real estate market nationwide, which will eventually help the home construction industry (which has a major impact on equipment markets) recover.
Both the NOL carry back provision and the home purchase tax credit are important pieces of the construction equipment industry revitalization agenda, which AED and AEM have been urging Congress to enact to get the equipment industry back on track. Stay tuned for updates as the Start Us Up USA! campaign will continue to monitor new developments and advocate for tax policies that will create jobs and spur economic recovery in our industry.
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Construction Unemployment Rate Increases 4 Times Faster
The unemployment rate for the overall economy grew .4 percent in October to 10.2 percent. This pales in comparison to the 1.6 percent jump in the construction industry’s unemployment rate as its reached a sky-high 18.7 percent. Additionally, the manufacturing sector lost another 61,000 jobs in October. These tragic figures serve to further highlight the dire need for a fully-funded multi-year reauthorization of the highway bill. When will the employment situation be bad enough in our sector to warrant the attention of the White House and Senate?
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President to Sign 60 Day Extension of Highway Bill
With the current program set to expire Saturday, Oct. 31 the Senate approved a another short-term extension of the highway bill on Oct. 29 to continue federal government funding at fiscal 2009 levels until mid-December. The House voted earlier to approve the measure, which now awaits the President's signature. The House and Senate are divided over whether to proceed with multi-year legislation to reauthorize the highway program or choose a shorter-term measure to delay the more comprehensive legislation.
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Idle Equipment Caravan Arrives in the Nation’s Capital
On October 28, congressional and construction equipment industry leaders and allies took to the National Mall to rally for reauthorization of the highway bill! Featured speaker House Transportation & Infrastructure Committee Chairman Oberstar exhorted the gathered crowd to keep up the pressure on Congress and the Administration to take action now! Following the rally, more than a dozen pieces of idle equipment motored around the Mall and Capitol Hill areas, up and down iconic Constitution and Pennsylvania Avenues, carrying campaign banners and blowing their horns to call attention to our bid to Start Us Up! again.
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Bipartisan Group of Lawmakers Sign Letter to House Speaker Pelosi Urging her to Make Highway Reauthorization a Priority Now
On October 22, the Congressional Steel Caucus, a bipartisan group of 36 members of Congress, sent a letter to Speaker Pelosi urging passage of a surface transportation authorization bill as soon as possible in order to support job creation and advance the nation’s economic recovery. To view the letter in its entirety, click here.
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Stalled Equipment Workers Rally to 'Start Up' Highway Jobs
On October 20, the construction equipment industry held a rally of construction equipment industry workers and other allies at Soldier Field in Chicago as part of Start Us Up USA! This national grassroots campaign calls on the federal government to swiftly reauthorize federal road, bridge, transit and rail programs to spur a jobs recovery now. Following the rally, a caravan of idle heavy construction equipment took to the streets of Chicago. Visit the Newsroom to view coverage of this event.
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AEM and AED Urge Congress to Enact the Construction Equipment Industry Recovery Agenda
On October 2, AED President Toby Mack and AEM President Dennis Slater sent a letter to Speaker Pelosi, Majority Leaders Hoyer and Reid, and Minority Leaders Boehner and McConnell urging Congress to take "dramatic and immediate steps to revive construction equipment markets" by swiftly enacting the construction equipment industry recovery agenda proposed by AED and AEM. To view a copy of the letter, click here.
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Status on Highway Bill
On Sept. 30, with hours to go before the current federal highway programs expire, Congress passed a 30-day extension to prevent a sudden drop off in funding. This is a positive development as it allows more time for the Start Us Up USA! Campaign to get its message out on the damage an 18-month extension would have on our already fragile industry. With reports surfacing that the Senate is beginning to soften on its demand for a long-term extension, it appears we are having an impact. Keep up the pressure!
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Las Vegas Event Kicked Off Start Up USA! Campaign
During a rally in Las Vegas On Sept. 29, construction equipment workers and business leaders launched Start Us Up USA!, a grassroots campaign calling on the federal government to move quickly to reauthorize a critical transportation bill. This bill will provide the necessary funding for our nation’s infrastructure which will spur a jobs recovery. The launch was followed by a caravan of heavy construction equipment, idled by a scarcity of new federal funding in transportation, parading down the Las Vegas strip.
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Study Finds Construction not in Recession, but Depression
A recently released study by IHS Global Insight, a respected economic and financial analysis firm, has found the construction equipment industry has shed 37 percent of its workforce. 2 out of every 25 jobs lost in the U.S. are tied to the slumping equipment industry, placing it ahead of both the auto and financial sectors. To view the report, click here.
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by Terex CEO Ron DeFeo
