Monday, 30 April 2012

NCDOT cautions drivers in work zones

The North Carolina Department of Transportation is reminding drivers to use caution in construction zones. It’s part of their Work Zone Safety Week, reports News14.

“You’re supposed to slow down, well he jumped right over on me and had I not thrown on my brakes he would have wiped me out,” said driver Sheila Joy. She stopped at a Cabarrus County gas station after a close call with a truck driver on Interstate 85 southbound.

“You have barrels and cones and sometimes trucks coming in and out of travel lanes and lane shifts,” said Jen Thompson, spokesperson for the NCDOT. It’s why they’re urging drivers to be more aware driving through construction zones.

According to the NCDOT there were 600 traffic related deaths in construction zones nationwide in 2010. The most common factor in those accidents was speed. “Generally in those work zones we have speed limits reduced,” said Thompson. She said there haven’t been any serious accidents in the stretch of the I-85 widening project where the speed limit is 55 mph.

But a work zone accident on U.S. 258 South in Kinston killed 60-year-old truck driver Ronald Easley early Wednesday when he crashed into another trailer stopped on the road. “We have a lot of folks working in the median and we just want folks to slow down for their safety and the safety of the workers,” said Thompson.

The I-85 widening project in Cabarrus County is expected to be complete in November 2013. Read More.

Friday, 27 April 2012

ConsensusDocs releses new web-based platform to share contract documents

ConsensusDocs® users will be able to work on their standard construction contracts using Microsoft Word® on a PC or Mac as the result of an upgraded new web-based platform released by the ConsensusDocs coalition. The new technology allows the more than 4,700 office locations currently using ConsensusDocs to share and collaborate with anyone using Word.

“The new cloud-based technology platform totally transforms how we deliver contracts,” said Brian Perlberg, executive director and senior counsel for ConsensusDocs. “Our growing base of subscribers can now collaborate and negotiate contracts more efficiently.”

The new technology allows contract sharing with multiple contract collaborators either via the web or offline, compare versions of Word, PDF, effectively organize contacts, projects, and each negotiation step into a central dashboard, create templates as favorites for future projects, convert scanned paper and pdf documents into text, and access new and updated standard contracts and technology improvements in real time.  Perlberg added that “the new technology is being offered at no additional cost and current users can opt to use either the new or old system for a period of time.”

The coalition is also releasing new and updated standard construction contract documents including:
• ConsensusDocs 702 Standard Purchase Order • ConsensusDocs 702.1 General Conditions to Standard Purchase Order • ConsensusDocs 235 – Standard Agreement Between Owner and Contractor (Cost of Work) • Exhibits A and B to ConsensusDocs 235 • ConsensusDocs 415 – Standard Agreement and General Conditions Between Owner and Design-Builder (Lump Sum) • ConsensusDocs 450 – Standard Agreement Between Design-Builder and Subcontractor • ConsensusDocs 460 – Standard Agreement Between Design-Builder and Subcontractor (Where the Subcontractor Provides an Element of Design and a GMP).

These new agreements and editions provide the latest contractual best practices in today’s design and construction industry for design-build, cost of the work, and purchase order construction contracts.
ConsensusDocs is a coalition of 35 associations representing diverse interests in the design and construction industry that collaboratively writes and endorses 90+ contract documents covering all methods of project delivery. The ConsensusDocs coalition is committed to assuring that the contracts continue to serve the best interests of the project and the industry. Read More.

Thursday, 26 April 2012

CPN of NC elects 2012 officers and directors

CPN of NC elected the 2012 officers and directors at its fourteenth annual conference in Hilton Head, SC. The new officers are: President: Peyton Fairbank, HICAPS, Inc.; President-Elect: Michael Schiftan, DevCon Resources; Treasuer: Eric Wisco, Eric Wisco, CPA, and Secretary: Mike Burriss, D. H. Griffin Construction Co.

Newly elected Directors are: Todd Berg, Morris-Berg Architects; Janet Brooks, Clark Nexsen Architecture & Engineering; Chuck Cardwell, Sutton-Kennerly & Associates, Inc.; Carl Carney, Davie Construction Co., Inc.; Richard Conner, Conner Gwyn Schenck PLLC; Alvin Etheredge, Duke Energy Carolinas, LLC; Joe Glass, Duke Energy Carolinas, LLC; Greg Mulholland, Preferred Engineering, PLLC; Tori Small, Westcott, Small & Associates, PLLC; Jude Starrett, City of Charlotte; Leo Stepansky, Shelco, Inc., and Ralph Stingo, John J. Kirlin, LLC.

CPN of North Carolina, Inc. is a statewide, non-profit organization of business and professional leaders who are involved with design, construction and related services.  Read More.

Wednesday, 25 April 2012

State's unemployment rate lowest in three years

North Carolina’s seasonally adjusted unemployment rate fell 0.2 of a percentage point to 9.7 percent from February’s revised rate of 9.9 percent, as the number of persons unemployed decreased by 12,092 to 451,657. “Since the start of the year, the rate has dropped three consecutive months,” said N.C. Department of Commerce Deputy Secretary Dale Carroll. “Over-the-year figures continue to show improving numbers with the private sector gaining more than 37,000 jobs.”

Seasonally adjusted Total Nonfarm industry employment, as gathered through the monthly establishment survey, decreased by 1,300 to 3,958,900 in March. Since March 2011,

Total Nonfarm jobs gained 38,800 with the majority of the gain coming from the Private Sector (37,200). The major industry with the largest over-the-month increase was Financial Activities, which gained 1,600.

The largest over-the-year increase of major industries was in Education & Health Services, which gained 11,500 jobs, followed by Trade, Transportation & Utilities at 11,400. Other significant increases included Professional & Business Services at 6,700, and Leisure & Hospitality Services, 4,800.

The number of people employed (smoothed seasonally adjusted) increased by 4,240 to 4,228,180 over the month, and by 63,805 over the year. The state unemployment rate in March 2011 was 10.4 percent. Read More.

Tuesday, 24 April 2012

Sixty-eight percent of highway contractors report vehicle crashes in work zone

Sixty-eight percent of the nation’s highway contractors had motor vehicles crash into their construction work zones during the past year, according to the results of a new highway work zone study conducted by the Associated General Contractors of America. Association officials added that the study found those work zone crashes are more likely to kill construction workers than they are to kill vehicle operators or passengers.

“Any time your job site is just a few feet away from fast moving traffic, things can get a little too exciting,” said Tom Brown, the chair of the association’s national highway and transportation division. “Since construction workers don’t get the option of wearing seatbelts, they are more likely to be killed in a work zone crash than motorists are.”

Brown said that 28 percent of contractors report their workers were injured during work zone crashes this past year, and 18 percent had at least one construction worker killed during those crashes. While they are less likely to kill motor vehicle operators and passengers, highway work zone crashes do pose a significant risk for people in cars, Brown added. He noted that more than 50 percent of work zone crashes injure vehicle operators or users, and 15 percent of those crashes kill them.

Work zone crashes also have a pronounced impact on construction schedules and costs, Brown added. He said that 35 percent of contractors reported that work zone crashes during the past year forced them to temporarily shut down construction activity. Those delays were often lengthy, as 47 percent of those project shutdowns lasted two or more days, Brown noted.

Association officials said that 75 percent of contractors nationwide feel that tougher laws, fines and legal penalties for moving violations in work zones would reduce injuries and fatalities. And 66 percent of contractors nationwide agree that more frequent safety training for workers could help. They added that many firms and the association have crafted highway safety programs.

But Brown suggested that the best way to improve safety was for motorists to be more careful while driving through highway work zones. “The easiest way to improve work zone safety is to get motorists to slow down and pay attention,” Brown said. “When motorists see construction signs and orange barrels, they need to take the foot off the gas, put the phone down and keep their eyes on the road.”

The work zone safety study was based on a nationwide survey of highway construction firms the association conducted in March and April of this year. Nearly 400 contractors completed the survey. Read More.

Monday, 23 April 2012

CPN of North Carolina presented its 2012 Star Awards

CPN of North Carolina presented the 2012 Star Awards for outstanding construction projects completed in North Carolina at the annual conference held in Hilton Head, SC. Two awards were given – one for projects under $20 million and another award for projects over $20 million.

The CPN Star Award is a symbol of excellence in construction and the selection is based on the merits and challenges of the project. In presenting the Star Awards, CPN honors the general contractor along with other member who participated in completing the projects.

The 2012 Star Award for a project under $20 million was presented to the International Civil Rights Center & Museum, Greensboro, NC. CPN member Weaver Cooke Construction, Greensboro, was recognized as the the general contractor on the project.

The 2012 Star Award for a project over $20 million was presented to The Joint School of Nanoscience and Nanoengineering, Greensboro, NC. CPN member Samet Corporation, Greensboro, was the general contractor on the project.

Both projects have contributed to the Piedmont Triad community. The projects employed local people during construction with a large percentage being minority. The International Civil Rights Center & Museum has historical significance. The Joint School of Nanoscience and Nanoengineering building is a collaboration of North Carollina A & T State University and the University of North Carolina at Greensboro, both local universities.

“The high tech research done there is intended to attract public- private partnerships and become an economic engine to drive the community and the state into the 21 century.” said Fred Patrick, Chair of the CPN Star Awards Committee.

CPN of North Carolina, Inc. is a statewide, non-profit organization of business and professional leaders who are involved with design, construction and related services. Read More.

Friday, 20 April 2012

NC Industrial Commission to enforce workers' compensation laws

The NC Industrial Commission will be taking a tough line next month against uninsured employers it has ordered to settle claims with injured workers: Pay up or go to jail.

The News & Observer reports more than a dozen employers have been ordered to come to a hearing May 22 and settle a claim that has dragged for years. If the business owners don’t – and can’t settle a portion of the claim – they’ll be ordered to jail. Law enforcement will be sent to arrest those who don’t show up for the hearing, officials say.

The efforts follow a News & Observer investigation which revealed that tens of thousands of employers required to protect their workers with insurance don’t. And when workers were hurt, the commission has done little to ensure the uninsured employer paid the workers’ medical bills and wages for missed work. Some workers ended up permanently disabled and reliant on Medicaid and welfare to survive.

“In response to the issues you raised, we now have some concrete plans,” said Pamela Young, chairwoman of the North Carolina Industrial Commission, the state agency charged with enforcing the workers’ comp laws.

In addition to the May 22 contempt hearing, the commission will schedule other special hearings to deal with lingering uninsured cases. Commission staff reached out to nearly 100 workers who reported they’ve been injured on the job and whose company didn’t have coverage. Most of those cases had fallen through the cracks because the worker didn’t have an attorney to press for collection.
About 125 uninsured employers who ignored the commission’s orders to pay the worker and penalties will be called back, too.

Young said the commission is spreading the word that it is serious about enforcing workers’ compensation laws, which require employers with three or more employees to carry insurance for workplace injuries. The law, which dates back to the 1930s, is supposed to ensure that industry takes care of its own accidents.

The Industrial Commission has long struggled with enforcement of workers’ compensation coverage. The commission, whose members are appointed by the governor, has the power to demand employers routinely show proof of coverage.

It has instead turned to the N.C. Rate Bureau, a private group that lobbies for insurance companies, to provide information on which carriers cover which employers.

Last month, the Rate Bureau accounted for about 140,000 companies covered through private insurers doing business in the state. Another 117 large companies have been certified with the Department of Insurance as having the ability to pay should their workers be injured.

That leaves a wide gap. The Department of Commerce estimates that as many as 170,000 companies operate in North Carolina that have four or more employees, one employee above the trigger for required coverage. Dun and Bradstreet, a firm that tracks businesses, counts about 174,000 companies with three or more employees headquartered in North Carolina; that number doesn’t account for those based elsewhere.

Young says she has been working for more than two years to establish a contempt process at the commission. In December 2009, Young said, she began meeting with local judges, sheriff’s deputies and magistrates in Wake County to come up with the right forms and procedures when the commission forces an employer to jail. Read More.

Thursday, 19 April 2012

Positive conditions persist for Architectural Billing Index

The America Institute of Architects (AIA) reported the commercial sector continues to lead the Architecture Billings Index (ABI) which has remained in positive territory for the fifth consecutive month. As a leading economic indicator of construction activity, the ABI reflects the approximate nine to twelve month lag time between architecture billings and construction spending.

AIA said the March ABI score was 50.4, following a mark of 51.0 in February. This score reflects a slight increase in demand for design services (any score above 50 indicates an increase in billings). The new projects inquiry index was 56.6, down from mark of 63.4 the previous month.

“We are starting to hear more about improving conditions in the marketplace, with a greater sense of optimism that there will be greater demand for design services,” said AIA Chief Economist, Kermit Baker, PhD, Hon. AIA. “But that is not across the board and there are still a number of architecture firms struggling so progress is likely to be measured in inches rather than miles for the next few months.”

Key March ABI highlights:
      • Regional averages: Midwest (54.1), Northeast (53.9), South (50.1), West (46.6)
      • Sector index breakdown: commercial / industrial (56.0), multi-family residential (51.9), institutional (47.7), mixed practice (47.2)
      • Project inquiries index: (56.6)
The regional and sector categories are calculated as a 3-month moving average, whereas the index and inquiries are monthly numbers. Read More.

Wednesday, 18 April 2012

Underground utility safety efforts moving forward in NC

A wide-ranging group of key legislators, regulators, owners and utility lobbyists agreed on April 12 to begin meetings after the short session of the NC General Assembly to develop proposed comprehensive legislation for next year to improve the state’s underground utility safety and damage prevention law.

“We will get in the room with stakeholders to come up with legislation at a time when we have seen serious accidents, we have seen deaths,” said Rep. Mike Hager (R-Rutherford), a leader of a House select energy committee and the House Public Utilities Committee. Rep. Fred Steen (R-Rowan), chair of House Public Utilities, concurred.

The action caps efforts led largely by the Carolinas AGC to improve the state’s safety and damage prevention law, regarded nationally as among the most lax in the nation. The move follows successful efforts by CAGC last year that resulted in passage of a major rewrite of South Carolina’s underground safety and damage prevention laws.

During the meeting last week, Hager, House majority freshman leader, emphasized that multi-pronged legislation needed to be sought, including safety, damage prevention and these issues:
  • Mandatory 811-call-before-you-dig participation and related penalties for noncompliance
  • Improved locator training
  • Equipment testing
  • Tolerance zone
  • Enforcement involving accidents to improve underground safety and make conditions “safer and safer.”
Hager also asked about two dozen attendees at the meeting, including representatives of Duke Energy and Progress Energy, if they would prefer to wait until after the short legislative session to work on the issue, with the idea of coming up with comprehensive legislation for the long session, which is expected to begin in January 2013. There was a consensus in the group not to pursue piecemeal legislation and instead wait until after the short session to allow more time to develop substantive amendments to current law. The short sessions begins May 16 and is expected to end in early July.

Allen Gray, CAGC Utility Division director, said he agreed with other attendees that it would be better to pursue more substantive legislation for next year. Dave Simpson, CAGC’s director of NC government relations and the NC Building Division, suggested that the meetings begin by early next fall and that the group use the new South Carolina legislation as the basis for the legislation. Hager said the meetings will begin then and South Carolina’s legislation, as well as related legislation in other states, will be used for the efforts to recommend underground safety legislation next year.

In previous meetings of the group, CAGC staff and members have discussed deaths and serious injuries that have occurred in underground utility work due to issues related to the one-call process. Staff also provided Hager and Steen, two supporters of stronger underground safety laws, and other organizations with information on tolerance zone and entities that endorse/recommend an 18-inch tolerance zone concerning locating facilities and hang digging around underground utilities. The entities include the U.S. Department of Transportation, Federal Communications Commission, Common Ground Alliance, American Public Works Association and others. In addition, CAGC staff has provided the legislators, lobbyists and regulators with info about the N.C. Underground Safety Coalition’s Draft amendments to existing law as well as Common Ground Alliance Damage Prevention Best Practices. More info, CAGC noted, is available at related links – CGA’s Web Site and Best Practices.

Tuesday, 17 April 2012

Residential construction marks best quarter since 2008

Homebuilding in the U.S. climbed in March, marking the best quarter since 2008 and indicating the real-estate industry has steadied, said economists surveyed by Bloomberg News.

Housing starts increased to a 705,000 annual rate last month from a 698,000 pace in February, according to the median estimate of 82 economists. Starts probably averaged 703,000 in the first three months of 2012, the most since the third quarter of 2008.

Warmer weather alongside historically-low lending costs and faster jobcreation may have spurred more homeconstruction at the beginning of 2012. While the number of single-family housing starts last year was the lowest on record, work on multifamily units is providing homebuilders with new business.

“Housing starts are starting to see stabilization,” said Anika Khan, an economist at Wells Fargo Securities LLC in Charlotte. “The numbers are still coming from a very low base, but there’s improvement. We’re also still contending with a lot of the effects from weather.”

The housing starts figures are due from the Commerce Department at 8:30 a.m. in Washington. Estimates in the Bloomberg survey ranged from 670,000 to 750,000.

The report may also show building permits slid by 0.7 percent to a 710,000 annual rate, according to the survey median. In February, the number of applications was at the highest level since October 2008.

Record-breaking warm weather probably boosted construction last month. The average temperature in the U.S. was 51.1 degrees Fahrenheit (10.6 Celsius), 38.6 degrees warmer than the 20th century average and the hottest reported March in records going back to 1895.

Even so, low borrowing costs and better job prospects should support demand for new homes. The average rate on a 30-year fixed mortgage reached an all-time low of 3.87 percent in February and was just a point higher at 3.88 percent in the week ended April 12, according to data from Freddie Mac.

Demand for apartments and condos, buildings that house multiple families, has also kept construction up. Builders began work on 241,000 of such units at an annual pace last month, the second most in more than three years.

Buyers “are starting to feel pressure not to miss this moment,” Lennar Corp. Chief Executive Officer Stuart Miller said during a March 27 conference call with analysts. “The fully-loaded cost of ownership is lower in the most-desirable markets than comparable rental rates.”

New-home orders increased 33 percent in the three months ended Feb. 29, the third-largest U.S. homebuilder by revenue said. Shares of the Miami-company rose to the highest level since 2007 after it reported the orders growth and net income that beat estimates.

Investors also are upbeat about prospects. The Standard & Poor’s Supercomposite Homebuilding Index has advanced 21 percent since the end of last year, more than the 8.9 percent gain in the broader S&P 500. Read More.

Monday, 16 April 2012

NCSU Constructed Facilities Laboratory tests building structures

We’d all like to think our buildings, roads and infrastructure are here to stay for the long run. At North Carolina State University's Constructed Facilities Laboratory, featured in the NCSU Technician, researchers know it’s only a matter of time before something goes wrong.

Earthquakes, erosion, and even time itself pose a threat to the things we use every day—but it’s the CFL’s job to push these structures to their breaking point to find out how to make them safer for society.

Established in 1996, the CFL boasts a large research complex dedicated to testing large-scale structures under a variety of environmental conditions.

According to engineering professor Rudi Seracino, the CFL employs a variety of techniques to test the integrity of materials and observe how they behave under stress. The seismic shake-table test uses a massive platform to simulate the conditions of an earthquake. Researchers can use the large-scale static test to apply a load at a slow rate until the structure fails.

However, catastrophic events aren’t the only things that can damage a material. Continuous everyday stress can cause damage, such as wind or cars driving over a bridge. In those cases, researchers use fatigue tests to simulate the real-life wear-and-tear a structure will go through over millions of cycles—the goal of this is to approximate the life span of a structure.

Many companies have already shown great interest in the CFL, and continue to do so. Sami Rizkalla, Mervyn Kowalsky and Rudi Seracino are researchers at the CFL’s structural engineering department. Their work has been consistently supported by government agencies such as the North Carolina Department of Transportation and privately-owned corporations like Progress Energy.

“We test the materials until they fail to learn more about how they work,” Rizkalla said. Learning about the way a structure behaves under stress is essential to learning how to improve it.
Rizkalla, a professor of civil engineering, conducts research with concrete structures. He is also researching an advanced fiber-reinforced polymer material and how it can be used on existing structures to strengthen and repair them. Rizkalla’s research aims to examine the behavior of large-scale structures in order to assess the safety of those structures.

Safety is an important aspect at the laboratory, and many of the current research projects are connected to the idea of better-preparing infrastructure for failure.

Civil engineering professor Mervyn Kowalsky is particularly interested in earthquake engineering research, focusing on the design of bridges to improve their safety during large-scale seismic events. Several of Kowalsky’s research projects are currently supported by the state of Alaska to improve the safety of the construction of bridges in the region.

One of the aspects Kowalsky’s research is working to improve is a method for constructing bridges. One bridge construction method involves driving large, hollow steel pipes into the ground. The pipes are then welded to beams to form the bridge supports. This is potentially dangerous, as the welding can become brittle and fail catastrophically during an earthquake. Kowalsky aims to replace this welding technique with a safer design that will force potential damage away from the welded connection.
In addition to improving the bridge’s safety, Kowalsky also aims to improve the efficiency and longevity of the bridges. For example, a lot of money is spent each year rebuilding structures that have failed. Instead of rebuilding an entire structure, part of Kowalsky’s research is concerned with repairing these structures to force future damage to another area of the structure.

“Safety is the most important thing to me,” Rizkalla said. “Paying close attention to the safety of a structure can save lives.” Read More.

Friday, 13 April 2012

Construction material prices up 1.4 percent in March

Construction materials prices rose 1.4 percent in March, the largest monthly increase since April 2011, according to the U.S. Labor Department’s producer price index (PPI) report, noted  Associated Builders and Contractors (ABC) Chief Economist Anirban Basu. On a quarterly basis, construction materials prices increased 2.7 percent and are 3.8 percent higher than March 2011. Following a similar pattern, nonresidential construction materials prices moved up 1.6 percent for the month, 2.9 percent for the quarter and 4 percent year over year, Basu said.

Softwood lumber was one of the materials experiencing a price increase in March, jumping 2.4 percent to reach levels 1.7 percent higher for the quarter and 0.5 percent higher compared to one year ago. Plumbing fixtures and fittings saw price increases of 0.6 percent for the month, 1 percent for the quarter and 3.3 percent year over year. Concrete product prices experienced increases of 0.3 percent for the month, 0.6 percent for the quarter and 2 percent year over year.

In addition, prepared asphalt, tar roofing and siding prices inched up 0.2 percent for the month, but are still down 3.2 percent for the quarter and are flat compared to March 2011. Iron and steel prices also inched up 0.1 percent for the month, and are up 0.4 percent for the quarter and 0.1 percent year over year.

Nonferrous wire and cable prices decreased in March, falling 1.3 percent for the month, 0.5 percent for the quarter and 4 percent year over year. Steel mill prices decreased 0.6 percent for the month, but were up 1.3 percent for the quarter and 0.4 percent during the last 12 months. Prices for fabricated structural metal products slipped 0.2 percent for the month, but were unchanged for the quarter and increased 2.6 percent compared to March 2011.

Crude energy materials prices dropped 9.2 percent in March and are down 7.4 percent for the quarter and 6 percent compared to the same time last year. Crude petroleum prices fell 11.2 percent for the month. Overall, the nation’s wholesale goods prices were flat for the month, 0.5 percent higher for the quarter and 2.8 percent higher than one year ago.

“Most construction materials prices behaved well in March,” said Basu. “The exception in this report was softwood lumber prices, which rose aggressively after a year of minimal increases. But a host of other input prices—including prepared asphalt, iron and steel, and fabricated structural metal products—barely budged.

“However, inputs into nonresidential construction are up 4 percent for the year, which is cause for concern,” Basu added. “Given lingering excess capacity among the contracting community and a general lack of pricing power, the increase in input prices during the past year likely has been enough to squeeze profit margins further for contractors. In addition, recent months have generally seen less vigorous increases in materials prices, which is a reflection of many factors, including a weak construction spending recovery in the United States
.
“Perhaps the biggest surprise in this month’s report was the sharp decline in crude energy prices,” Basu said. “Analysts have been predicting for months that oil and other energy prices are set to surge, in part because of geopolitics. But that did not occur in March, creating a source of relief for an industry that uses substantial amounts of diesel fuel to transport materials, in addition to using many other forms of energy throughout the construction process.” Read More.

Thursday, 12 April 2012

Construction industry employment dips in March

The construction industry lost 7,000 jobs between February and March, following a similar decline of 6,000 the month before, but extended a pattern of modest year-over-year job increases, according to an analysis of new federal employment data released by the Associated General Contractors of America. Association officials said that lack of long-term federal highway and transit funding threatens to hold down future job gains.

“Both the small monthly change and the March-to-March gain of 55,000 jobs or 1 percent are consistent with the uneven, tentative recovery that contractors have been reporting nationwide,” said Ken Simonson, the association’s chief economist. He noted that March was the seventh consecutive month that construction employment had risen from the same month a year earlier. “Meanwhile, the industry’s unemployment rate has been dropping faster than the pickup in construction jobs, implying that workers are leaving the industry, which could cause problems later,” he said.

“Multifamily, manufacturing, distribution and energy-related construction are booming,” Simonson observed. “In addition, private hospital and university work are starting to improve, but public construction is declining, while single-family homebuilding, office and retail work are largely limited to remodeling jobs.”

Simonson stated the construction unemployment rate in March was 17.2 percent, or roughly double the national unemployment rate, although the industry rate had improved from 20 percent in March 2011 and 24.9 percent in March 2010. “In the past two years, the industry’s unemployment ranks have dropped by more than 800,000,” he said. “That is good news for those who have found jobs, but unfortunately construction firms have not hired most of them. Construction employed the same number of workers—5.55 million—in March 2012 as it did in March 2010. That means construction workers are leaving the industry, either for other jobs or to retire, and contractors may have trouble finding experienced workers in the future.”

Association officials said the pickup in construction jobs is likely to remain anemic and unbalanced unless there is adequate funding for long-term infrastructure programs. They cited the continuing lack of action on a multiyear federal highway and transit bill as a particular problem.

“Just when contractors should be adding workers and getting an early start on the spring construction season, Congress has again left town leaving highway funding on another short-term extension,” said Stephen E. Sandherr, the association’s chief executive officer. “When lawmakers return this month, they should follow through on a bill with enough funding to enable contractors and state agencies to make longer-run plans.” Read More.

Tuesday, 10 April 2012

Lien law revision committee final report is mixed bag for subcontractors and suppliers

Guest editorial by James P. Laurie III, The Law Office of James P. Laurie III, PLLC, Raleigh. Reprinted from the April 2012 issue of Carolina Subcontractor, published by the American Subcontractors Association of the Carolinas. 

The Revisions to the North Carolina Mechanics Lien statute submitted by the  Lien Review Committee to the General Assembly are a mixed bag for subcontractors and suppliers. The Revisions fix many problems, but ultimately create new forfeiture points and greater expense and impractical compliance obligations on subcontractors and suppliers earlier in projects than exist in the current statute.

Last year, the North Carolina Bar Association submitted a draft Bill for introduction to the North Carolina General Assembly to make extensive modifications to Chapter 44A, the existing Mechanics Lien statutes in North Carolina. The Bill was sent to Committee for evaluation and charged with the goal of addressing the “problem” that the Carolinas Associated General Contractors and the North Carolina Land Title Association refer to as “hidden liens,” which are all of the lien rights granted to second and third tier subcontractors and suppliers under the current statute.

For the past several months, the Lien Review Committee, which is a subgroup of the Senate Judiciary Committee of the North Carolina Legislature held public hearings and heard presentations and has revised the Bill Draft. The initial Bill sent by the NCBA had extensive revisions which proposed converting the statute to a format similar toFlorida. The Committee has revised the Bill Draft, but has taken a much less ambitious revision in its final Report.

Tweaks
The Revision made several clarifying tweaks to the routine language of the statute; many of the language corrections are small, but intended to make common usage terms more clear or better defined where the 1970′s language failed to make clear the tiers of the parties in the various provisions.

Correct Lien Waivers Case
The Revision corrects the problems caused by a ruling from the Superior Construction case in the North Carolina Business Court, which interpreted progress payment lien waivers to be final lien waivers and interpreted lien waivers as affecting the date of last furnishing by a contractor, which would change the priority of liens with other creditors; this view of the effect of lien waivers is not shared or practiced in the market place.

Standardized Partial and Final Lien Waivers
The Revision does provide standardized lien waiver forms for partial and final lien waivers expressly written into the statute as defaults which are intended to avoid inadvertent waiver of claims and retention and the practical problem that no standard lien waiver is currently used in the commercial market place.

PreLien Procedures
The Committee abandoned the PreLien draft terms from NCBA which were intended to address the “hidden liens problem” due to the controversy and lack of consensus between stake holders regarding the terms. These revisions were the most drastic part of the NCBA proposal in seeking to adopt PreLien procedures which were a hybrid of theFloridascheme. Although the Committee abandoned this effort for Liens, it did include revisions to create a notice procedure for payment bonds on public projects as noted below.

Altering when Lien Perfection Occurs
The Revisions cause perfection of liens to occur earlier under the terms of Chapter 44A to counteract the effect of a series of cases in the Eastern District Bankruptcy Court, commonly referred to as Harrelson/Mammoth. The ruling from this line of cases prohibited potential Lien Claimants from filing their lien after a Bankruptcy petition was filed by the Contractor, and since no lien could be filed, the potential lien claimants were treated as unsecured creditors, instead of secured creditors as a result of their inability to file their liens, despite otherwise having enforceable lien rights under the State statute. The Revisions cause “perfection” to occur earlier, which would circumvent the Bankruptcy ruling. Ironically, on the day the committee heard presentations on why this needed to be fixed, the Bankruptcy Court issued a decision in the appeal of these cases, which wiped out the effect of the cases, making the revisions unnecessary for the moment.

Revisions Fail to Correct Pete Wall Case
This case was a ruling by the North Carolina Court of Appeals, where the Contractor, through no fault of its own, and as a result of operation of contract terms between the Owner and a Lease arrangement for the property, the statutory Lien Rights of the Contractor were wiped out without any recourse, because the work was furnished pursuant to a Lease. Floridarecently amended its statute to allow Lien Claims to reach the fee owner of the property, and not just the Lessee’s interest, and ASAC proposed making a similar change to the North Carolinastatute. The issue affects contractors and subcontractors negatively. The Committee indicated that it desired to correct the effect of the Pete Wall case, and invited proposals from the industry stake holders to include in the Committee’s revisions. Only ASAC submitted a proposed statutory change to correct the effect of the Pete Wall case, but, unfortunately, the Committee took no action on the proposal from ASAC due to lack of time, and recommended “further study” of the issue
.
Create Civil Action for False Lien Waivers
The Revisions provide a civil cause of action allowing a party to sue for recovery of treble damages and attorneys fees as an unfair and deceptive trade practice under Chapter 75 when a false lien waiver was furnished; although the statute already made providing a false lien waver a misdemeanor crime, it was considered toothless, where District Attorneys were unwilling to prosecute such matters.

Notice of Public Subcontract Procedure for Payment Bonds
The Revisions create an entirely new lower tier subcontractor Notice of Public Subcontract procedure, which if not complied with, limits the subcontractor=s right of recovery under the bond to work furnished only within 60 days of the bond claim suit. The subcontractor will be required to research and furnish substantially more information for the Notice of Public Subcontract prior to the existence of any claim, in order to avoid a limitation on its payment bond claim later. Intended to cut off late filing claimants, the additional payment bond claim procedure will create new forfeitures of the right to recover for work furnished by subcontractors and suppliers and accepted by contractors and owners, to address the issue of possible double payment. Under the revisions, contractors have a duty to furnish contractual information to subcontractors for their use in preparing notices, but if the they fail to provide the information, they suffer no penalty under the proposed draft revision for failure to do so, only losing the benefit of the curtailed subcontractor claim.

The Revisions recommended by the Lien Review Committee will be taken up in the short session of the General Assembly. See the Committee on Mechanic’s Lien on Real Property Final Report here.

Monday, 9 April 2012

Lien Law Study Committee submits final report to NC General Assembly

Guest Editorial by Nan E. Hannah, Esq. and Keith E. Coltrain, Esq., Member and Chair of the Lien and Bond Law Revision Committee of the Construction Law Section of the North Carolina Bar Association.

On March 27 the North Carolina General Assembly’s Committee on Mechanic’s Lien on Real Property issued its final report which now goes to the Legislative Research Commission (“LRC”) for approval. If approved, the proposed revisions to Chapter 44A contained in the report will go to the House and Senate for consideration during the 2012 short session.

For the construction industry, this provides a solid reason to monitor the upcoming short session. What is it that we are watching?

House Bill 489 (H489) was introduced in March 2011. This bill was the result of the Construction Law Section of the North Carolina Bar Association’s efforts to implement comprehensive revisions to Chapter 44A. The focus of these revisions were to address changes in industry practices and several major court decisions which stressed the industry and undermined the constitutional mandate that the legislature provide laborers and materialmen with an adequate lien.

House Bill 489 was too controversial to be passed in the 2011 Legislative Session. The House and Senate agreed, however, that the matter deserved to be studied. Thus, the, the issue was sent to the LRC which appointed a committee to explore the subject. The committee’s co-chairs, Senator Peter Brunstetter of Forsyth Countyand Representative Sarah Stevens of Gaston County, dove into the details of H489 and met informally with stakeholders.

The co-chairs identified aspects of H489 which were deemed non-controversial or potentially subject to compromise within the short window of time provided to the committee. The committee then held three formal meetings and organized an informal stakeholder’s meeting to discuss the various issues.
The committee’s final report included aspects of H489, but it is not nearly as comprehensive. The changes adopted include:

1.  Definitions: Off-site non-commodity work would be defined as an “improvement” thus providing a basis for lien rights even if the work were not delivered to the project site.

2.  Bankruptcy fix: There is a “fix” for the Harrelson-Mammoth bankruptcy issues. The recent decision in the Construction Supervision Services, Inc. bankruptcy raises a question as to whether a fix is necessary. That decision, however, has been appealed, and the proposed fix remains for now.

3. Standardized lien waivers: Forms have been added to 44A-12 to provide standardized partial and final lien waivers to reduce the confusion which continues to arise with the language of many existing forms.

4. Increased sanctions for false statements: The changes to 44A-24 would expand who could assert claims for harm caused by false statements. Violators would also be subject to disciplinary actions by their respective licensing boards.

5. Payment Bond Claims on Public Projects: Under the adopted changes, a contractor on a public project would have to provide each of its subcontractors a “project statement” which would contain the information necessary for lower-tier subcontractors to provide a pre-notice to the contractor. So long as a lower-tier subcontractor timely provided the pre-notice, it would be entitled to pursue its full claim to the same extent it does now. Delays in providing the pre-notice would limit the lower-tier subcontractor’s claim to the value of work provided within sixty days of its claim. Regardless, lower-tiered claimants would still be able to recover up to $10,000.00 even if they failed to provide the pre-notice.

Noteworthy is the absence of relief for the title industry from “hidden liens.” The committee recognized the importance of the issue but concluded it did not have to time to resolve it. The report recommends further study.

The committee also recommended further study into the Pete Wall issues (i.e., liens against leasehold interests) with the purpose of strengthening the lien rights of persons who contract with lessors.

There remain several significant issues with our mechanics lien law – even beyond the hidden lien and Pete Wall issues. Those issues should be reviewed in the future. For now though, we have appreciated the opportunity to initiate the current proposed changes and to serve as an advisor in the legislative process.

Read Committee on Mechanic’s Lien on Real Property final report here.

Saturday, 7 April 2012

PNC economic outlook survey sees inceased capital investments by NC businesses

PNC Financial Services Group completed its purchase of RBC Bank, based in Raleigh, and the integration of its 415 branches in the Southeast. Besides planning to hire more than 250 “customer-facing” employees in North Carolina by the end of 2013, PNC has added the state to its list of bi-annual economic outlooks, beginning this month. The survey focuses on small- and midsize business owners, reports the Winston-Salem Journal.

“We intend to grow in North Carolina and knowing the views and needs of the state’s business owners will help us to serve them better,” spokeswoman Dorsey Tobias said.

The survey found a growing confidence among N.C. business owners about the economy and their expectations. However, they weren’t as optimistic as their peers nationally, who are projecting the economy to strengthen to pre-recession levels. “The U.S. economy is improving, but it appears the N.C. economy will be a step behind in the overall recovery,” said Mekael Teshome, an economist with PNC.

The survey found 20 percent of N.C. employers expect to hire full-time employees during the next six months, while 11 percent expect to add part-time employees and 6 percent plan to reduce full-time staff. “An improving outlook for sales or business expansion plans are cited by 65 percent of owners as top reasons to add employees,” according to the survey. Teshome acknowledges the full-time hiring projections aren’t overly optimistic, but do represent an improvement over recent years.

Other economic outlooks, such as from Manpower Inc., also have shown a slight increase in employer hiring interest in recent quarters. Manpower projects 17 percent of N.C. employers will add workers in the second quarter and 5 percent will cut staff.

The PNC survey found 82 percent of N.C. business owners hope to increase their business “at least a moderate amount” over the next six months. Teshome said he was not surprised that more than three times as many business owners (68 percent) are more interested in making a capital investment, whether in equipment or software upgrades, than adding full-time staff.

“Some employers want to see a few more months of positive data and positive news, since they are risk-adverse to full-time hiring,” Teshome said. “They want to feel confident the recovery has staying power even against unforeseen economic shocks.

“For them, it’s an easier decision to upgrade their equipment and technology to enable their existing workforce to be more efficient with their work time.” In terms of hiring expectations, 45 percent of the business owners say their requirements for employee skills and background are higher now. Their top-three priorities are computer/technical abilities, extensive experience in their field and sales skills.

About 69 percent of the business owners expect to raise prices by more than 2 percent to help offset a projected increase in health care costs. About 21 percent expect to have double-digit sales gains during the next six months.

“The obvious question is whether the next six months will be better economically,” Teshome said. “My expectation is that it will be. It appears the housing depression is about over, with home prices firming up and more in balance with wages.” Read More.

Friday, 6 April 2012

American Subcontractors Association supports SBA's surety bond guarantee proposals

On April 5, the American Subcontractors Association (ASA) told the U.S. Small Business Administration that it supports the agency’s proposal to make it easier for small business construction contractors to apply for a surety bond with an SBA guarantee.

ASA submitted comments in support of a regulatory proposal to reduce the paperwork burden associated with the SBA’s Surety Bond Guarantee Program. The proposal would apply to surety bonds guaranteed by SBA for construction contracts with an anticipated award value of $250,000 or less. Under SBA’s proposal, a new “Quick Bond Guarantee Application and Agreement” would replace two separate forms, one for application, and one setting forth the specific surety bond guarantee agreement.

The proposal would also directly lessen the paperwork burdens on ASA members participating in the SBG program by eliminating two forms that currently must be submitted. Finally, the SBA proposal would eliminate the confusion caused by regulatory references to a form that is no longer used. SBA’s SBG program for small construction contractors has two major elements. Under the Prior-Approval Program, a small contractor makes application to a participating corporate surety, which then submits the application for the SBA guarantee to SBA for approval or denial. Under the Preferred SBG program, SBA enters into an agreement with a corporate surety, which is then empowered to directly issue a surety bond with the SBA guarantee, an easier process for both contractor and surety.

ASA was a major supporter of the legislation that authorized the Preferred SBG program. Learn more about the overall SBG program for small businesses on construction contracts with an award value of $2 million or less.

Wednesday, 4 April 2012

Nonresidential construction spendng up 6.4 percent from year ago

According to this week’s report by the U.S. Census Bureau, total nonresidential construction spending is up 6.4 percent from one year ago. However in a clear indication that the construction industry continues to feel the effects of the nation’s economic woes, total nonresidential construction spending fell 1.6 percent in February to a seasonally adjusted annual rate of $555.4 billion, reports Associated Builders and Contractors’ ABC Chief Economist Anirban Basu.
 
“While the nation’s economy has been improving since last September, the ABC Construction Backlog Indicator (CBI) accurately predicted construction activity would suffer a lull during the early months of 2012,” said Basu.

Private nonresidential construction spending decreased 1.6 percent for the month, but is up 14.5 percent year over year. Public nonresidential construction spending fell 1.7 percent for the month and is down 0.7 percent compared to February 2011.

Twelve of the sixteen nonresidential construction subsectors experienced decreases in spending for the month, including amusement and recreation, down 3.9 percent; lodging, 3.2 percent lower; water supply, down 2.8 percent; highway and street, down 2.7 percent; and commercial, 2.6 percent lower. Subsectors posting the largest decreases in year-over-year spending include conservation and development, down 24.6 percent; lodging, 9.4 percent lower; religious, down 9.4 percent; water supply, down 7 percent; and transportation, down 5.5 percent.

In contrast, four of the sixteen nonresidential construction subsectors posted increases for the month, including religious, up 2.7 percent; manufacturing, 2.2 percent higher; public safety, up 0.9 percent; and sewage and waste disposal, up 0.5 percent. Eight subsectors have experienced gains in spending during the past twelve months, including manufacturing, up 40.3 percent; power, 22.1 percent higher; public safety, up 11.4 percent; health care, 7.7 percent higher; and commercial, up 5 percent.

Residential construction spending was unchanged for the month and is 4.6 percent higher compared to the same time last year. Overall, total construction spending – which includes both nonresidential and residential – was down 1.1 percent in for the month, but is 5.8 percent higher than February 2011.

“ABC’s CBI declined during last year’s fourth quarter, largely due to the soft patch that emerged economy-wide early last year,” Basu said. “The combination of rising commodity and input prices, along with the debt ceiling issues that plagued the nation last year, weakened financing availability and demand for design services, which is now translating into diminished construction activity.

“Last year’s soft patch likely impacted construction activity more than the data reflect,” said Basu. “If it wasn’t for the mild winter, construction spending would have fallen even more sharply in February."

“Overall, the outlook for construction is generally positive,” Basu said. “Unless there is another hiccup in the nation’s economic momentum, construction spending data will come to reflect the improvement in the broader economy that observers noted during the past half year.” Read More.

Residential drives NC construction contracts to a 24 percent gain

A significant improvement in the residential category pushed North Carolina’s February total for new construction contracts to a 24% monthly gain, compared to the same period of a year ago, reports Southeast Construction.   McGraw-Hill Construction estimated the value of all February contracts at nearly $1.2 billion.

Housing contracts tallied $646.2 million in February, a 69% jump compared to last year. The nonbuilding category, which includes infrastructure projects, eked out a 3% increase for the month with about $218.2 million in new contracts. The nonresidential market fell 14%, however, with its total of $291.2 million.
 
Despite the February increase, North Carolina’s year-to-date contracts total is still down compared to early 2011. To date, McGraw-Hill estimates the state’s contracts total at about $1.9 billion, or 2% lower than a year ago.

By category, residential is the only positive sector, according to the company. The housing sector has registered roughly $1.1 billion in new contracts so far in 2012, or 42% better than the first two months of 2011. Nonresidential is 41% behind last year’s early pace, however, with roughly $474.3 million in new projects to date. The nonbuilding category, estimated at $338.7 million, is 10% behind the same period of a year ago. Read More.

Sunday, 1 April 2012

CAGC Foundation announces 2012 scholarship recipients

As part of its 25th Anniversary celebration, the CAGC Foundation, Inc. launched its inaugural scholarship program to assist those entering the construction industry and provide financial aid for those wishing to advance their construction careers. CAGC Foundation is pleased to announce its 2012 scholarship recipients.

UNIVERSITY SCHOLARSHIP – $4,000 Jessica Alan, Greensboro, NC – An employee of Coleman Floor Company, Jessica is junior at the University of North Carolina at Greensboro, pursuing a Bachelor of Arts in Business Administration. In addition to her full-time employment, Jessica also maintains a full load of college courses and a 4.0 G.P.A. Upon the completion of her studies, it is Jessica’s dream to start her own local construction company.

TECHNICAL/TRADE SCHOOL SCHOLARSHIP – $2,000 (2 awarded) Clay Baber, Charleston, SC – A superintendent at Trident Construction, Clay is pursuing a Construction Management Certificate from Trident Technical College. Having worked his way up from carpenter to Superintendent, Clay is proud to follow the path set by his father. His father began as an iron workers and worked his way up to the position of general superintendent for some of the [Southeast's] tallest buildings.

Anthony Crowell, Charlotte, NC A former member of the United States Air Force, Anthony is eager to enter the construction industry and is pursuing an Associate Degree in HVAC from Central Piedmont Community College. He writes his family has made a lot of sacrifices in order for me to continue my education. He is close to finishing the long journey he started.

INDUSTRY CERTIFICATION/ACCREDIATION SCHOLARSHIP – $1,000 Colin Shropshire, Columbia, SC Colin is an employee of W.B. Guimarin & Co., looking to further his construction education through the pursuit of a Building Operator Certification from Gwinnett Technical College. Colin is a 2010 graduate of The Citadel in Civil & Environmental Engineering.

The CAGC Foundation, Inc. serves the construction industry by financially supporting excellent workforce. Read More.