Posts Tagged ‘Stimulus’

Around the Web: Updates on Construction Law and Wolfe Law Group 3/27/09

This week, some familiar topics were being talked about in the legal blogosphere, from the Employee Free Choice Act to the Chinese Drywall situation in Florida, Louisiana and elsewhere.  Here are some selected articles and posts from around the web this week:

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The Big Draw: Washington’s Stimulus Share Divulged

Washington state officials released figures to the media on Thursday, illustrating that the state is due to receive some $225 Million in funding. Initial planning earmarks all of that cash for major public building projects.

A story released by the Seattle Times, indicates that the bulk of funding will be distributed for military projects, including a new water-distribution system at Whidbey Island Naval Air Station, a training facility at Fort Lewis, replacement of a Tacoma pier that supports the Army Reserve Boat Mission, and installation of advance metering systems at Navy hubs that will help monitor energy consumption.

Additional funds will be earmarked for public housing and transportation. One highly anticipated project will likely be the new Amtrak maintenance facility at King Street Station. That project is likely to exceed $40 Million. Ongoing restoration of King Street Station is costing the City of Seattle, its new owner, over $26.5 Million.

In related news, the State Legislature released its $4.3 Billion transportation plan. Under the plan, the State will be able to pay for the new Alaskan Way Viaduct, Highway 520 bridge, and purchase new ferries.

There has been some recent distaste for the laboring that has ensued over the Viaduct and 520 projects. Senate Transportation Committee Chairwoman Mary Margaret Haugen, D-Camano Island probably said it best:

“I really probably shouldn’t say this, but I hope those people building those megaprojects would make some decisions and move forward, because the Legislature’s only going to have so much patience.”

“We’re really delighted that a decision has been made on the viaduct. We hope it can be made on 520 also.”

The projects continue to come for Seattle. Its hard to imagine more public building – in a city where projects are ever present.

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Mixed Messages for the Construction Industry on the Stimilus and State of the Economy

On January 1, 2009, the forecast for the construction industry and the American economy in general was reported grim.

Since then, however, we’ve sworn in a new President, Congress passed an aggressive (albeit controversial) “Stimulus Package,” and the dead of winter has bowed to a new Spring – typically a more productive time of the year for construction.

So where are we?

Well, the news for the construction industry carries mixed messages.

Let’s start with the bad news:  McGraw Hill Construction reports that February construction dropped 8% from January, and Reuters predicted that construction jobs will continue to report weak throughout 2009.

In an interview with Reuters, Chief Economist for the American Institute of Architects (AIA), Kermit Baker, had this to say about the economy and the stimulus:

The Obama stimulus will put some people to work as soon as next month, but it will not be a major factor until the third quarter, Simonson said. Even then the stimulus will have little visible impact on payrolls, since contractors will use existing workers before they bring back people who have been laid off or start to hire new people.

The good news, of course, is laced within the forecasted bad news: the stimulus.

No one is certain of how large the impact will be, but many in the construction industry are already sizing up the stimulus opportunities and other available government work.

Ken Simonson, the chief economist for the Associated General Contractors of America, had a positive outlook for business and employment in the construction industry and the benefits of the stimulus.   During a talk to association members, he said:

It’s not going to be enough to bail out construction right away…but it’s a start.

Already stimulus money is being allocated towards real construction projects and creating jobs.  See this story about $101 million in transportation work in Oregon, or the Larose bridge project in Louisiana.  Even Monster.com has published an article about how the stimulus package will spark construction jobs.

The stimulus certainly gives the construction industry optimism, but from all accounts, it appears to be cautious optimism.

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Around Washington: Public Works Blooming

There is a growing fear that the construction market is dead – or at least headed that way. Recent figures indicate that overall building is on the decline and that, specifically, public contracting has falled at least 12% over the month of February.

Despite rashes of optimism that new building is up, the figures tend to tell a different story. Both private and public investment in new building are both on the decline. The drop off indicates that there is certainly a lack of funding and construction “players” who drive the industry.

But some states tell different stories. Some actors seem to be driven by falling costs in the construction market, and secured future sources of funding.

Take the State of Washington for example, who has recently experienced a bounding growth in publicly managed and publicly subsidized projects. Here is a peak at what is going on in the Northwest corner:

  • Pave Those Highways – Try to drive anywhere in the Seattle area and you cannot miss the traffic. Recent highway projects have taken over Interstate 5 with the intention of improving drive quality for commuters. The state estimates that over $2 billion of repairs are needed to improve I-5 in the Seattle metropolitan area. Unfortunately, the state has earmarked on a small fraction of that amount in order to complete reconditioning. Luckily, Department of Transportation administrators are not backing down, despite potential funding issues. DOT said that 2009 will be “one of its most intense and complicated construction seasons in its history.”
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Louisiana Contractors: Start Your Engines

Here is a quote from New Orleans’ Mayor Ray Nagin in a recent USA Today article titled “$700M in federal aid finally flowing to New Orleans:”

Construction on jails, police and fire stations, playgrounds, theaters and mixed-income housing developments — all battered by the 2005 floods — has started or will start this year, as public federal funds finally were unleashed from bureaucratic tangles, Mayor Ray Nagin said in an interview with USA TODAY.

“You’re going to be able to see, touch and feel it,” Nagin said. “We’re really headed into a year of unprecedented construction.”

Certainly this is exciting news for contractors in Southeast Louisiana, who experienced a surge of work in the aftermath of Hurricane Katrina, but has since succumbed to the rigors of the national recession.

The news of Katrina-related aid coming to the region is icing on top of the cake for the Louisiana construction industry, who is looking forward to a large amount of stimulus cash being spent in the state’s infrastructure.

Just this weekend there was news out of Baton Rouge that despite previous resistance, Governor Bobby Jindal would likely be accepting all stimulus aid.  The state launched a stimulus spending website, http://www.stimulus.la.gov/, and identified the first LA project to use stimulus funds (the long awaited Larose bridge).

How Do You Take Advantage of The Stimulus?

If your company is interested in taking advantage of the planned stimulus projects it must get familiar with public contracting, Davis-Bacon prevailing wage requirements, the public bidding process and more.

A great resource to learn more the requirements and strategies of public contracting is Mike Purdy’s Public Contracting Blog.

With more than 29 years of public contracting and procurement experience, Mike helps government agencies and businesses develop contracting strategies, solve contracting problems, and get better informed on a wide variety of public contracting and procurement issues.  His consulting company, Mike Purdy & Associates, is based out of Seattle, WA.

Here at the Construction Law Monitor, we provide commentary and insight on the legal components of government contractor (state and federal).  You can read posts related to public contracting through the category Public Contracting here.

Last month (Feb. 2009), we posted a particularly helpful article for businesses unfamiliar with the public contracting process called “The Stimulus Package and Your Construction Business.

The article briefly breaks down the legal and practical differences between public and private work, and outlines the basics for contractors interested in preparing their company to bid on public jobs.

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