The HVACR industry faces a critical labor shortage that remains contractors' top policy concern. The time has come to enhance and streamline government support for career and technical education (CTE) generally and contractors' in-house training programs in particular.

Reauthorize WIOA and include the Employer Directed Skills Act

As part of an urgently-needed reauthorization of the Workforce Innovation and Opportunity Act (WIOA), Congress should include legislation to directly support contractors' training needs, including direct support for in-house programs to develop the next generation of HVACR professionals.

Create tax incentives for in-house training

With trade schools producing so few career-ready graduates, many contractors have invested millions to create their own training programs. ACCA proposes new tax credits, like the Workforce Apprenticeship Growth and Education Support (WAGES) Act, to defray the costs of innovative in-house training programs and inspire others to follow suit.

Reform apprenticeship programs to meet contractor needs

ACCA applauds President Trump's executive order seeking one million new apprentices. To meet that goal, however, we must reform these programs to better support both in-house and multi-state programs.

We have a welcome ear at DOL but need to hear your specific pain points and creative ideas for making apprenticeship programs work for contractors.

Possible additional solutions

1. Support Perkins CTE Grants and other state and federal appropriations for career and technical education through traditional trade school pathways.
2. Enact the CTE Awareness Act and other legislation to promote awareness of careers in the skilled trades.
3. Endorse immigration reforms enabling high-skill HVACR workers (E-3-style visa pathways).
4. Support the Work Opportunity Tax Credit (WOTC) and other programs that support hiring individuals from historically disadvantaged populations.

Contractors call upon decades of experience and industry standards to help consumers balance comfort, safety, efficiency, and affordability in designing comfort systems for their homes and businesses. But regulators increasingly limit consumer choice with bans on natural gas or specific technologies like non-condensing furnaces. Such efficiency rules often mandate unaffordable modifications to existing structures and fail to achieve real-world efficiency gains.

Protect access to natural gas

Regulators in at least 11 states have moved to restrict access to or eliminate incentives for natural gas equipment, forcing oversized heat pumps or inefficient resistance heat that can reduce comfort and affordability, increase humidity and mold, and strain our electric grid. ACCA encourages more states to join the 27 states that have acted to protect access to efficient gas equipment and supports the Energy Choice Act to extend that protection nationwide.

Modernize the Energy Policy and Conservation Act (EPCA)

The furnace rule recently struck down by the Supreme Court is a prime example of how frequently changing DOE regulations under a half-century old law impose costs on consumers and the HVACR industry. ACCA urges Congress to modernize EPCA with an eye towards affordability, consumer choice, and regulatory certainty including:

• Base HVAC efficiency standard compliance on the date of manufacture, rather than when or where equipment is installed
• Avoid frequent changes by requiring DOE to evaluate appliance standards using a minimum 10-year lookback period
• Require DOE to follow its own "Process Rule" to account for affordability, market adoption, consumer impacts, and cumulative regulatory burden
• Strengthen federal preemption to ensure a unified regulatory framework under EPCA

Possible additional solutions

1. Fight regulations like Ultra Low NOx that serve as a de facto ban on certain fuels or technologies.
2. Preserve fuel neutrality across federal and state efficiency incentive programs.

Contractors overwhelmingly agree that efficiency incentives should reward quality installation (QI), not just equipment ratings. Recent studies suggest that as many as 90% of residential HVAC systems have significant installation faults, costing 30-50% of their rated efficiency and negatively impacting equipment longevity, comfort, health, and safety. Fortunately, smart connected tools and third-party verification like ACCA's Quality Installation (QI) certificates now allow policymakers to incentivize realized efficiency like never before.

Shift incentives from equipment ratings to Quality Installation

Current federal, state, and utility incentives pour billions into increasingly costly equipment, with no assurance that systems will be properly designed and installed. Prioritizing and streamlining incentives for systems installed and commissioned in accordance with the ACCA 5 Quality Installation Standard will help ensure that consumers get what they pay for while driving demand for quality contractors.

Restore efficiency tax incentives

Before they were eliminated in the 2025 budget process, the 25C Home Energy Efficiency Tax Credit, 179D Commercial Building Energy Efficiency Deduction, 45L Energy-Efficient Home Credit, and 25D Residential Clean Energy Credit drove contractor business by providing incentives that are simple, fuel neutral, and available nationwide. These incentives could be restored at lower cost by eliminating costly prevailing wage bonuses and/or adding Quality Installation requirements.

Possible additional solutions

1. Create a federal tax incentive for Quality Maintenance (this was a 2025-26 priority solution, but Congress has little appetite for new tax incentives and we believe workforce and efficiency incentives are a higher priority.)
2. Embed QI in Home Energy Rebate programs and explicitly support continuation, expansion, and fuel neutrality of these programs.
3. Support continuation of ENERGY STAR programs and resist efforts to limit them with unnecessary electrification or Buy American mandates.
4. Support regular government studies on Quality Installation and Quality Maintenance and promote findings through agencies and utilities.
5. Require all federally funded or financed housing programs including LIHEAP, WAP, and IRA-funded rebate initiatives, to mandate verification of quality installation in accordance with ACCA/ANSI QI and QM Standards.
6. Advocate for Congressional oversight and GAO review of energy and housing program outcomes to ensure that taxpayer dollars achieve lasting efficiency, comfort, and safety benefits for low-income families.

With the painful transition to mildly flammable A2L refrigerants still underway, some states are already moving forward with a rushed transition to highly flammable A3 refrigerants. While A3 technologies may be worthy of future study, they're nowhere near ready for mass adoption and ACCA will fight state and federal policies that accelerate another refrigerant transition.

Federal preemption to prevent a patchwork of state rules

Ensuring an orderly national phase down of HFCs is a major reason the AIM Act was enacted with bipartisan support in 2020, but we now see legislators in California, New York, Washington, and elsewhere proposing a patchwork of accelerated phase-outs, reclaim mandates, certification requirements, and extended producer responsibility laws. ACCA opposes major changes to the AIM Act, but Congress should deliver on its promise of regulatory certainty with a targeted amendment to add federal preemption.

Stop state transitions to highly flammable A3 refrigerants

New York State's Part 494 regulation mandates a rushed transition to highly flammable A3 refrigerants with deadlines between 2027 through 2034. California and Washington have empowered their regulators to follow suit and "clean heat coalitions" are pursuing similar policies in at least ten states. ACCA will fight any state mandate or residential code adoption until appropriate standards, consensus codes, training, certification, and affordability safeguards are in place.

Modernize technician certification

Improved refrigerant reclamation is essential to avoiding a rushed A3 transition, so ACCA supports updates to EPA's 608 certification, including flammable refrigerant safety training, periodic recertification, continuing education, and clearer enforcement of certification for all individuals who handle refrigerant.

While ACCA defers to state and local Allied Contracting Organizations (ACOs) that set their own state policy agendas, not every state has an ACO and some ACOs have encouraged ACCA to take a more proactive role in guiding and supporting a state policy agenda.

Gridlock in Washington also means that states are the primary arena where contractor policy priorities will play out over the next two years, including these priority solutions discussed in the preceding sections:

• Reform apprenticeship programs to meet contractor needs
• Protect access to natural gas and gas equipment
• Stop state mandates for highly flammable A3 refrigerants
• Shift efficiency incentives from equipment ratings to Quality Installation

In addition, ACCA will support state efforts on additional priorities expected to play out primarily on the state level:

Meaningful standards in HVACR licensing

Seventeen states currently lack a meaningful HVACR license. Even where they exist, weak continuing education and enforcement undercuts quality contractors, increases the risk of poor workmanship and safety hazards, and reduces consumer trust. In some states, however, labor requirements have gone too far in constraining the HVACR workforce.

ACCA seeks feedback on these questions to help develop principles for model HVACR licensing legislation:

• Does your state license companies, owners, and/or technicians? What works well and what would you change?
• Are your state's initial and/or continuing education requirements reasonable? What works well and what would you change?
• Do your state's rules excessively constrain the HVACR workforce or your lines of business? What would you change?
• Are your state's licensing rules effectively enforced? What works well?

PFAS regulations and liability reform

States are increasingly regulating PFAS — "forever chemicals" — potentially restricting access or imposing recordkeeping requirements related to a variety of refrigerants, lubricants, and coatings. These regulations would directly impact manufacturers and distributors who have led campaigns to secure exemptions for HVAC applications. Contractors may also have an interest in joining the fight against a state-by-state patchwork that could raise equipment costs, limit product availability, and complicate compliance.

Some general liability policies also now include exclusions from coverage for PFAS-related liability. However low the actual risk, lawsuits related to the use of products that contain PFAS could impose significant legal costs on contractors. This emerging issue adds urgency to campaigns for liability reform, whether specific to PFAS or aimed at protecting small businesses from "nuclear verdicts" more generally.

Defend small businesses from unfair competition

Many utilities and government-affiliated entities have created service companies that leverage monopoly infrastructure, ratepayer funds, and/or regulatory exemptions to unfairly compete with independent contractors. This causes contractors to face unfair cost structures, reduced access to customers, and exclusion from programs that favor utility-affiliated providers.

State legislatures and utility commissions should prevent the use of ratepayer or taxpayer funds to support commercial ventures that compete with private HVACR contractors. Requiring transparent disclosure and legal separation of regulated utility functions from competitive service activities can help ensure that consumers benefit from open competition, price transparency, and innovation driven by independent businesses.

What else should be on our state policy agenda?

In 2025, Town Hall attendees shared creative state policy ideas like:

• A Labor Day sales tax holiday for tool purchases.
• Limiting non-compete agreements that constrain free enterprise.
• Allowing health and accident insurance policies to be sold across state lines.
• Permitting reform, either specific to allowing data centers or more general.

Do you like these ideas or have other suggestions for ACCA's state policy agenda?

The full discussion draft walks through four additional ACCA positions that we could consider elevating as priorities:

• Trade and tariffs
• Oppose burdensome regulations on small business
• Defend small business tax relief
• Healthcare

We'd love to hear which of these issues and specific solutions are worth a significant investment of ACCA resources, but we're even more interested to hear your own big ideas!

We hope you'll consider sending a comment or video message via this form. Comments received by October 30 may be featured as part of the Virtual Contractor Town Hall scheduled for November 17.