Best Practices Construction Law : Construction Lawyer & Attorney : Matthew DeVries : Smith Cashion & Orr Law Firm : Green Building & LEED Litigation

On Thursday, I will be joining a panel of construction attorneys and consultants to address the issue of aging infrastructure in America and, in particular, how to finance all the work that needs to be done. 

Our panelists include: 

Christopher Montez, Thomas, Feldman & Wilshusen, LLP, Dallas, TX
Kenneth R. Baker, Hill International, Poway, CA
Sarah Biser, McCarter & English, LLP, New York, NY
Robert Rubin, McCarter & English, LLP, New York, NY
Dennis Staats, Navigant Consulting, Boston, MA

You can still register for the short webinar on the Forum's website. Here are a number of answers that our panelists will try to answer: 

• What is the problem? Where are the major failures? 
• What are the sources of funding?
• How much money does the Federal Government want to pitch in?
• What can contractors do to maximize their changes to win Federally funded work?
• How may Public Private Partnerships help solve the problem?
• What does it take for a PPP to be successful?
• What can construction counsel do to help his/her clients in this arena?

If you have any questions that want answered in the webinar, it's not too late.  Send me an email and I will make sure that one of the panelists addresses it.

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Okay, so you think I went to San Francisco just to get some good eats.  Not true.  I also went for the program.  The panel of speakers at the the mid-winter conference of the ABA's Forum on the Construction Industry was packed with some great government contracting professionals. 

To me, some of the best words of wisdom came from the Honorable Steven Reed, a former judge of the Armed Services Board of Contract Appeals who now practices in the Washington, DC office of Smith, Currie & Hancock LLP.

Judge Reed's talk focused on the alternative dispute resolution process and, more specifically, "... the practical side of developing the contractor’s story in support of a claim."   Some of Judge Reed's best tips:

• The big picture: Contractors must anticipate the possibility (if not the probability) of disputed matters. Prevention and preparation are essential to a favorable outcome.
• Documentation: "Daily reports are generally required under Federal contract.  They "should contain facts ... not feelings or emotions." (Don't call the project manager a "jerk" in the project documents, even if he is one.)  Rather, use the daily report as an "opportunity to create a comprehensive record of performance." 
• Claim proof:  "Your contractor client will absolutely need its bid papers for evidence in claim against Government."  It's a no-brainer, but you need a good document management process in place.  
• Dispute forum:  Picking a forum for resolving your dispute is strategic.  For example, a decision from the Board of Contract Appeals will be "predictable" and the process is more "stable" while the Court of Federal Claims will be more "rule bound."  The forum is also important because the Court has certain jurisdiction over fraud claims, while the Boards do not.

Judge Reed concluded his written presentation with sound advice: "Contractors need to be educated, prepared, aware, and well-represented." 

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I am in San Francisco this week for the MidWinter Conference of the American Bar Association Forum on the Construction Industry.  The topic this year is "Government Construction Contracting" and I will be tweeting under the hashtag #ABAConstruct.

In news relevant to Federal contractors, construction industry players and Californians, the San Francisco Business Times reported yesterday on the approval of a $171 billion federal loan for the construction of a new transit center in San Francisco.  The loan is earmarked to pay for ramps to the Bay Bridge, a bus storage facility and the design of underground transit facility.  Good for the construction industry in California.  Other states are supposed to get some of the $8 billion set aside by the Obama administration for high-speed rail.

What can we learn from this report?  Almost every "construction news" feed that I follow includes some news article about the sustained decline in construction jobs.  There are also many reports about the stagnant hold on residential building.  Here's what I think:

• Federal and state projects will continue to represent the primary areas of growth within the construction industry for 2010.
• As those projects are the only ones available, there will continue to be increased competition for the limited work.
• There will continue to be an increase in bid protests and disputes arising out of these projects.

What do you foresee? 

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This morning I read Brad Heath's article in USA Today, suggesting that the stimulus funding for road repairs has detoured and by-passed large metro areas with significant road problems.

According to the USA Today study, half of the nation’s worst roads will receive only about 20% of the stimulus money allocated for street repairs. The reason—the roads were not shovel ready and were in too bad shape:

“The problem is a byproduct of a stimulus package designed to spend as fast as possible to revive the economy. Many roads are in such bad shape that repairs would take too long and cost too much to qualify for funds, says John Barton, head of engineering for Texas' Department of Transportation.

The result is that counties with the worst roads won't get much more repair money than counties with better roads. The 74 counties with half of the nation's bad roads will split $1.9 billion, records show; counties with no major roads in bad shape will split about $1.5 billion.”

Data compiled and reviewed by USA Today showed that many of the roughest roads needing repair were … let’s say … not ready for repair.  For example, state officials acknowledged that “Detroit's roads are in dire need of work, but say they didn't have enough ready-to-go projects there.”

According to Kent Starwalt, Executive Vice-President of the Tennessee Road Builders Association, the important question is not whether transportation projects are shovel ready, but rather, why weren’t these projects shovel ready?

“It would seem that if a jurisdiction’s roads are in really poor condition, they would have the necessary steps done to be able to move on projects when and if they did receive money. [Tennessee Department of Transportation] and many other state DOTs were well prepared for such a scenario. The cities were even given more time than the states in the stimulus bill to obligate any money they were to receive.”

This is more than just an issue of timing and money. One measure of the House transportation re-authorization bill includes the transfer of control from state departments to city and metropolitan planning organizations. However, Starwalt warns: “It should be obvious to everyone involved that the cities are not as efficient in getting projects out the door as state DOTs.”

This debate is interesting to those of us who follow the federal stimulus funds with the hopes that the funds actually impact the construction industry, the workers and employees involved in the projects and the local economies.

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I was listening to Nashville Public Radio yesterday morning about a new competition brewing on the Internet.  This battle was not as fierce as the one to become the greenest state in the South.  It was more like a friendly exchange of "we're not in competition with each other because we offer similar, but different services" battle.

The NPR story featured the two primary websites that assist in tracking stimulus dollars: www.recovery.gov and www.recovery.com.  (There is actually a third URL at www.recovery.org, which is the real face of the Dot-Com website.)  The Dot-Com and Dot-Org websites are owned by Onvia, a company that provides various public procurement and reporting services to business and governments.  Through its public spokesperson Erika Lindsay, Onvia responded to my inquiry about its stimulus tracking information: 

Recovery spending is a small subset of overall government spending that we already track. Each day we capture the [American Recovery and Reinvestment Act of 2009] funded project level events from all levels of government and from all geographies and present them real-time on www.recovery.org . This includes details on projects that have dollars committed but have not yet started (Allocated), formal bid requests and RFPs (Advertised) and contract award notices (Awarded).

The Obama Administration's version of the stimulus-tracking database is maintained at www.recovery.gov, which was officially established as part of the American Recovery and Reinvestment Act of 2009:

The [Recovery Accountability and Transparency] Board shall establish and maintain...a user-friendly, public-facing website to foster greater accountability and transparency in the use of covered funds. The website...shall be a portal or gateway to key information relating to the Act and provide connections to other government websites with related information.

First, what's the real difference between these two sites? The real difference appears to be the timeliness of the information that is publicly available for viewing.  The Dot-Com site is updated in real time as data is received about public lettings, awards and receipt of information about project spending ... whereas the Dot-Gov site ... well, is not so quick.  According to the NPR article, the commercial website "has spending information that the government won't have until October."  The other major difference?  Onvia allows public comment on particular projects, which tends to generate a lot of buzz about the use of funds for certain projects.

Why is this important for the construction industry?

• Setting aside the Dot-Com v. Dot-Gov distinction, both of these sites provide useful information on the status of stimulus funded projects. 
• Although there appears to be more money in the pipeline for construction work (...which was supposed to lead to job creation...), the data that is available illustrates that the stimulus money is slow to reach the market.
• Finally, information released on the sites actually supports the trend that is being reported about "lower bids" throughout the industry.  In other words, public contract awards are "coming in 16 percent lower than usual" according to www.recovery.com figures. 

The best part about the NPR story ... one project that has already been awarded is an $18 million contract for a complete redesign of www.recovery.gov. 

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