Army HQ work at Fort Bragg to start

The Fayetteville Observer reports the Army will break ground Dec. 8 on a $288.5 million headquarters complex, taking the first step in making the official move of a four-star command to Fort Bragg.

Scott Dorney, Executive Director, NC Military Business Center (NCMBC), pictured left, is one of a team of experienced business development specialists who can help NC contractors with proposals to win future military business.

Forces Command and Army Reserve Command are scheduled to move from Atlanta by Sept. 15, 2011, under the 2005 Base Closure and Realignment law. The BRAC moves and other military growth is expected to bring 40,000 additional people to the 11 counties and 73 towns around Fort Bragg by 2013.

BRAC and other military growth will expand Fort Bragg to 73,000 soldiers and civilian employees, said Paul Dordal, executive director of the BRAC Regional Task Force.

The headquarters move will trigger economic opportunities for the NC construction industry. New arrivals will put demands on everything from the information technology resources to the aging sewer infrastructure. Rep. Bob Etheridge said the “great challenge” will be to fix the infrastructure to support growth. One of the biggest issues when Congress goes back into session Nov. 17 will be funding school construction, he said.

NCMBC, a state-funded business development agency, disseminates information to NC-based contractors and subcontractors about military business opportunities. Contractors can get daily leads by registering with www.matchforce.org. For free help with proposals to win government business, visit www.ncmbc.us or call 877-245-5520.

Click here for the complete October 31 Fayetteville Observer article on BRAC-related construction opportunities.

CONSTRUCTION NEWS Planning Meeting

We’ve returned from several days of meetings in West Quebec. Construction News employees and key contractors gathered there to review our past progress and set out the business plan for 2009. In the picture, facilitators Upkar Bikhu and Bill Caswell of Casewell Corporate Coaching Company review topics we discussed--our mission statement, where we are, where we want to go, the economic environment, how we’re going to get there and financial projections.

Perhaps the most impressive quality of the meeting—outside of the goodwill and cooperation among the participants—is that we concluded that next year will turn out well for the business despite the current uncertainty in the economy.

Our optimism is not carelessly based. Undoubtedly the nation’s economic troubles will affect the state’s A/E/C marketplace. Some projects are on hold, financing is more difficult to obtain and the residential construction market is still in recession.

Yet we see a silver lining in this economic climate. Surviving construction businesses will want to maintain and preserve their relationships and will find value in working with us because we focus on building connections, links and respecting these relationships.

In 2009 readers of Triangle/Triad Construction News and Charlotte Construction News can expect to see more coverage of NC economic trends. Our Community News section will be expanded to include more networking and business development opportunities. Residential construction success stories will be featured. Our coverage of construction business opportunities on the Carolinas coast will be expanded.

With our 2009 plan in hand, the Construction News team is ready and able to face the current challenging business environment.

Economic Recovery Plan 2.0

After weeks of extraordinary efforts by the world’s governments and central banks, the frozen flow of credit has begun to thaw. The improvements in the credit markets came as welcome news to NC contractors, subcontractors, and their clients large and small who depend on short-term financing.

The Associated General Contractors of America (AGC) estimates that over $100 billion of new infrastructure projects have been delayed due to the reduced credit market. Coupled with construction materials cost inflation, fewer contracts are going out to bid resulting in lost construction jobs and a further deteriorating national infrastructure.

More needs to be done to help the economy by the Congress -- perhaps passing a second stimulus package. AGC is urging Congress to develop an economic recover plan that includes provisions that will boost construction activity.

A significant boost to construction in the form of increased infrastructure investment will create jobs and increase the quality of life for millions of us who rely daily on our nation's infrastructure, from roads and bridges, to water systems and schools.

In late September, the House passed an economic stimulus bill (264-158) which included approximately $34 billion for infrastructure investment, including $12.8 billion for the federal-aid highway program; $3.6 billion for transit; $600 million for airport capital improvement projects; $7.5 billion for water infrastructure; $5 billion for the U.S. Army Corps of Engineers; $3 billion for public school reconstruction; $500 million for Amtrak; and $1 billion for public housing construction. A similar bill in the Senate failed.

NC Construction News supports a new economic stimulus plan that will create jobs by building roads, bridges and highways. Construction has always been an engine of economic stimulus and can play that role once again. Increases in infrastructure investment can be quickly put into play and will have a direct, immediate and dramatic impact on the economy.

AGC has additional information on infrastructure investment including a white paper, "The Pivotal Role of Federal Intrastructure Investment in Our Economy." Visit the AGC web site at www.agc.org.

NCDOT cuts highway spending by $50 million

North Carolina's road-building and transportation budget is being cut by $50 million, a number that could easily grow to $200 million for the year, the
Charlotte Observer reports.

Transportation Secretary Lyndo Tippett enacted 6 percent cuts in spending in response to declining tax revenue. He said no highway construction projects have been delayed so far, but he anticipates the reductions eventually will cause delays.

The department is continuing a hiring freeze, eliminating travel and training expenses and canceling new equipment purchases.

The 6 percent reduction mirrors the decline in combined revenue from the state's gas tax and the highway use tax, which is applied to car purchases.

The state's gas tax collections have declined as gas prices have risen, because North Carolinians are cutting back on their driving.

The tax used to rise with the price of gas, but legislators capped it two years ago at 29.9 cents per gallon. While that revenue stream for road-building was frozen, the price of oil-based asphalt rose, along with other petroleum products.

If tax revenue remains down at the current level, the department will have to cut $200 million by June 30 of next year. The cost of highway construction has doubled since 2002.

Click here to read the Charlotte Observer article published October 17.

USGBC hosts 'Follow us as we LEED' event

The North Carolina Triangle Chapter of the U.S. Green Building Council (USGBC) will host a panel of experts offering three different perspectives on a current Raleigh green commercial building project at their upcoming luncheon meeting on Thursday, November 6th at the Radisson Hotel in the Research Triangle Park.

The panel discussion, entitled “Follow Us as We LEED,” will focus on the American Institute of Architects (AIA) headquarters project in downtown Raleigh, an in-progress LEED platinum project.

The 12,000-square-foot structure is intended to meet both LEED Platinum standards and the American Institute of Architects’ Committee on the Environment objectives. The building will house staff offices and a lecture hall for presentations and feature a community recycling center and an outdoor area for concerts and farmers’ markets. Architect Frank Harmon has employed cutting-edge green building elements such as photovoltaic cells, a rooftop garden, and geothermal wells.

Harmon will be one of the panelists offering his views of the project from the architect’s perspective. Joining him are David Crawford, director of the American Institute of Architects NC Chapter, representing the owner’s perspective and Scott Cutler, VP of marketing at Clancy & Theys, representing the contractor’s perspective. Lori Eichel, president of Accent Construction and membership committee chair for NC Triangle Chapter of USGBC will moderate the panel.

Members and guests are invited to hear what these involved leaders have to say about what’s working and not working in LEED projects of this magnitude, what they wish they had known at the beginning, and lessons learned to date.

Those interested in attending the event must register by Wednesday, October 31st. Registration for the luncheon program is $15 for students and members of Emerging Green Builders (EGB) committee, $25 for members of the NC Triangle Chapter, and $35 for guests. The program runs from 11:30 am to 1:30 pm.

For questions or more information contact Lori Eichel, lori@accentllc.com, 919-636-4503.

Triangle county commissioners vote to borrow $300 million for construction

The News & Observer reported today that the Wake county commissioners voted unanimously to take out a $300 million short-term loan to help cover the costs of construction projects until the nation's credit markets stabilize.

Wake county manager David Cooke said the global financial crisis has made it nearly impossible for the county to sell $454.5 million in voter-approved bonds that officials expected to issue this fall to pay for new schools, libraries, open space preservation and an expansion at Wake Technical Community College.

Yesterday’s vote gave Cooke the authority needed to borrow $300 million from Bank of America for one year. The final terms won't be set until the county closes on the loan later this month, but Cooke said the expected interest rate is between 2 percent and 2.5 percent. The move will keep money flowing to county construction projects currently under way, most of them new schools.

"This allows us to keep these projects going while we watch the markets play out," Cooke said. Raleigh city manager Russell Allen said he expects to propose a similar short-term borrowing plan to the City Council next week.

Allen said the city will likely need to line up some financing to keep design work on two projects moving forward -- a new $226 million public safety center and the construction of a network of remote operations facilities costing $223 million.

Allen said the size of the short-term financing package hasn't been determined.
Several planned county projects, including a new downtown courthouse and a jail expansion, are likely to be delayed for an indefinite period, depending on financial conditions. Some planned school construction projects will also likely be delayed.

In all, Wake must trim at least $154.5 million from its capital building program for the next year. The rapid pace of residential construction in the county has slowed, easing the demand for new schools. And with fewer private construction projects, construction companies are giving lower bids for government contracts.

Phil Stout, the county's director for construction and design, said Monday that the bids for projects are coming in much lower than expected, meaning that the county could save millions on cost estimates made when the economy was stronger.

Click here to read the complete News & Observer article.

Increased NC commuter rail envisioned

The North Carolina Railroad Company (NCRR) released an 11-month study on October 9 that concluded rush-hour commuter trains can operate on NCRR tracks along with freight trains from Greensboro to Goldsboro.

NCRR commissioned engineering firm HNTB to determine if commuter and freight trains could coexist on NCRR tracks, and the infrastructure costs that doing so would incur. HNTB studied possible commuter trains operating in four segments between Goldsboro and Greensboro, and Chapel Hill.

If a Goldsboro-to-Greensboro commuter plan were implemented on the NCRR corridor, trains would make 29 stops in seven counties with a total population of more than 2 million, with 18 colleges and universities within two miles of the rail lines. The cost: $1 billion.

Knowing that freight and commuter trains can coexist was a key question that had to be answered before anyone could try to establish commuter trains, Bill Kincheloe, chairman of the NCRR Board of Directors said.

NCRR owns the 317-mile rail line between Morehead City and Charlotte. Existing freight service, operated by Norfolk Southern, already touches 24 percent of the state’s economy and is projected to increase. NCRR President Scott Saylor said that based on the HNTB study, he is optimistic that commuter and freight service could also coexist on the Greensboro to Charlotte sections of the rail line, but that further studies would be needed.

“North Carolina could become a national leader in commuter rail,” Saylor said. “This design for commuter trains could be implemented without buying new right-of-way. That’s a significant cost advantage.”

The idea of expanded commuter trains in isn’t a new one. Regional organizations and local governments throughout the state have expressed interested in establishing rail services. “The NCRR line touches many of those local efforts, but it will need to be a team effort,” said Saylor. “Connecting municipal bus systems also would be required for commuter rail to succeed.”

To view the complete study, click on www.ncrr.com.

OSHA releases proposed crane safety changes

The U.S. Occupational Safety and Health Administration has proposed revision of the crane and derrick safety standard.

A committee of safety experts, crane users, project owners and insurers convened more than four years ago to negotiate the new crane and derrick rules which cover major hazards in light of new technology, labor demands and work methods.

The proposed changes include provisions for power line safety, ground conditions, equipment inspections, signaling qualifications and crane operator certification. Standard testing requirement, or certifications, for crane operators would go into effect four years after the rule is implemented.

More than 89 people die every year due to crane accidents and related hazards, according to federal statistics. The rule would not avert every crane-related accident but would eliminate the majority of them by saving 53 lives and preventing 155 injuries per year, according to OSHA.

The NC Department of Labor is considering the certification of construction crane operators after a series of major accidents involving large "tower" cranes in other states. The rules will be based on OSHA's proposed update of federal safety rules. See NC Proposes New Crane Safety Rules published in previous NC Construction News blog.

The deadline for public comments on the proposed revision of this extensive safety standard is December. 8, 2008. The complete proposal is published in the October 9 Federal Register.

The power of word-of-mouth marketing

The Society for Marketing Professional Services Foundation (SMPS) recently released "Growing Your Business Using the Untapped Power of Word-of-Mouth Marketing." The 21-page white paper emphasizes the power of word-of-mouth (WOM) marketing and offers proven strategies that can be used to help grow your construction-related business.

The key ingredients of a WOM campaign are: giving people a reason to talk about you, making it easy for people to share information about you, and engaging and energizing those people to initiate WOM.

To learn the six steps you need to cultivate WOM and create additional work opportunities, click here to download this white paper. Included in the paper you will find a list of 24 tips to help you integrate WOM into your professional services business, monitor WOM for your firm, and more.

Eight white papers released by SMPS in August are now available online at no charge.

SMPS has two active chapters in NC, one in Charlotte and the other in the Triangle (Raleigh-Durham-Chapel Hill). You can view these chapter websites for upcoming events and other construction marketing-related services.

NC ranks 29th on ACEEE Energy Efficiency Scorecard

North Carolina ranked 29th on the list of U.S. states employing energy efficiency as the "first fuel" to grow their economies while meeting electricity demand, combating global warming, and contributing to U.S. energy security.

The new report was released today by the American Council for an Energy-Efficient Economy (ACEEE). The 2008 State Energy Efficiency Scorecard rated and ranked state-level action on model energy efficiency policies, programs, and practices.

ACEEE’s state-by-state analysis found that first-place California was followed by Oregon, Connecticut, Vermont, New York, and Washington. Minnesota and Massachusetts tie for seventh place with Wisconsin and New Jersey rounding out the final two spots in the top ten. North Carolina ranked 29th, moving up one place from 30th on the 2007scorecard.

Faced with rapidly increasing energy costs and growing concerns about power reliability and global warming, more and more states are turning to energy efficiency as a reliable, cost-effective, and quick resource to deploy to meet electricity needs, reduce greenhouse gas.

North Carolina didn’t rank highly in any category, though the state did get some credit for strict building codes and for a law enacted in 2007 that requires utilities to get a percentage of their power from renewable sources beginning in 2012. The ACEEE report said the 2007 law isn’t aggressive enough on actually saving energy versus merely getting energy from alternative sources.

The state also ranked low for its spending on efficiency programs, which ACEEE says represented less than 0.1 percent of utility revenue in 2006. The electricity saved through efficiency programs represented less than 0.01 percent of total electricity sales in the state in 2006, the report says.

The 2008 State Energy Efficiency Scorecard report is available for free download at www.aceee.org/pubs/e086.htm or a hard copy can be purchased from ACEEE Publications, 529 14th St, N.W., Suite 600, Washington, D.C. 20045. e-mail: aceee_publications@aceee.org.

Best estimate contest form due October 15

A new contest seeks to recognize and reward those estimating professionals and/or their teams who manage to get it right. The Best Project Estimate Challenge — the first of its kind in the estimating profession – is seeking entries from owners, architects, general contractors and estimators from all types of projects.

Kind of a “closest to the pin” challenge for professionals that estimate, the contest is open to any firm whose project estimate won a prime construction contract by 2 percent or better.

The 2009 award will be presented at the American Society of Professional Estimators Annual meeting in St. Louis in July 2009, and the winning project will be featured on the cover of Design Cost Data magazine giving the winner national recognition.

Firms interested in submitting a project presentation for the Best Project Estimate Challenge are asked to complete and submit an “Intent to Participate Form” by October 15. Forms can be downloaded on www.dcd.com. All projects complete after July 1, 2007 are eligible for submission. Project entries are due no later than February 1, 2009.

Design Cost Data will also present a $1,000 contribution to the ASPE National Scholarship Program in the winning firm’s name. The International Builders Exchange Executives will match with $1,000 to the local ASPE chapter of the winning firm.

For more information contact Barb Castelli at Design Cost Data magazine at 800-533-5680 or email barb@dcd.com.

Lessons learned from the financial crisis

The turmoil in financial markets over the past several weeks is stressful for everyone in our state and nation. The uncertainties driving banks to fail or merge, and stock markets to plummet one day and rally the next, concern us all.

In a timely letter to members of the American Subcontractors Association, William J. Olmo, III, 2008-09 ASA national president said, “whatever actions are taken by our federal government, let’s hope that they will help alleviate concerns about diminished credit and our financial futures. No one wants to see a repeat of the early 1990s, when many firms in our industry went bankrupt for lack of profitable projects, because of slower payment practices, and/or because of the inability to obtain needed credit.”

Olmo suggested that “one of the lessons we can take away from the current financial crisis is that packaging can mask the value — or lack of value — of an underlying product. Buyers and sellers of mortgage-backed securities assumed that these securities would provide a good return because they looked like other successful investments. They didn’t see the wolf in sheep’s clothing. The wolf was in the details of the mortgage financing paperwork. With a sufficiently large number of these mortgages defaulting, it appears we’ll all pay the price — through our tax bills, our home equity, our investments, and our retirements.”

The ASA president added, “If there’s one good thing that comes from this crisis, it’ll be a renewed focus on real return-on-investment. Certainly, everyone will look more closely at the real value of their personal and business investments. And, while the economy may add pressure for subcontractors to bid aggressively, we must take the time to remind our clients that two different bids, even at the same number, are not interchangeable.”

Contractors should remind clients of the real return-on-investment they’ll get working with your company. You must differentiate your company from others and show your company’s true value. All contractors are not alike.

The low-bid mentality, that still prevails in our industry, fails to recognize that real project success — defined as safety, quality, efficiency, price and timeliness of construction — depends on healthy and effective working relationships, including contracts and values that both sides can live with.

NC Proposes New Crane Safety Rules

The News & Observer reported that operators of construction cranes will have to be certified under new safety rules proposed by state labor officials.

The NC Department of Labor is considering the rules after a series of major accidents involving large "tower" cranes in other states. The rules are based on a proposed update of federal safety rules that has yet to be enacted, said Neal O'Briant, Labor Department spokesman.

Ten people have died in crane operations in North Carolina in the past 10 years, including two since 2007. None involved "tower" cranes, which are a modern type of crane built on construction sites. The federal government has not updated its national standard for crane safety since 1993.

The new state standard could go into effect April 1, 2009, after a period of public comment and hearings, O'Briant said. A major provision would require certification of crane operators by a national accrediting organization, he said. The new rules would take into account changes in crane technology over the past 30 years.

Other key provisions would require a qualified person to address hazards related to assembling and disassembling cranes, make sure ground conditions are adequate to help prevent tip-overs and outline specific precautions for operating cranes near power lines.

For additional information, click on News & Observer or visit the NC Department of Labor website.

Before enacting the crane safety standard, the NC Department of Labor must publish it in the North Carolinas Register and allow a 60-day public comment period from the date of publication. The Labor Department will also hold public hearings to invite comments from interested parties.