GBC Reports..., March 13, 2003

State's Cash Flow Heading for a Crisis?
The State's fiscal and budget crisis MAY begin to hurt the construction industry and many others. Last Friday, New York State Budget Director Carole Stone wrote to all the state agencies directing them to defer until further notice all payments not statutorily required, to include payments for capital construction, and to begin to look at things like "suspending" of contracts to save money. 

What's going on here? This year's budget crisis is different from those in the past. In the past, the state had the cash, but needed the authority to pay when the new state budget was not in place after April 1. This year the state does not have the cash. It is projected that in the coming months the state's cash flow could be in a serious crisis due to the state's large budget shortfall in the current fiscal year ending March 31st and the large projected budget gap in next year's budget, totaling $10 to $12 billion. The Governor wishes to securitize the tobacco settlement. The Assembly Speaker rejects that idea and offers an idea of his own. Without some action soon, the State will have a serious cash flow crisis. 

GBC talked to OGS, SUCF and DASNY today and asked how they plan to implement this directive. Both SUCF and DASNY operate mostly with proceeds from bonds floated specifically for their various programs. They are continuing to make payments and are going forward with bidding and awards. OGS's work is financed by hard dollar appropriations. They have told us that they are processing payments through the Comptroller's office. OGS does continue to bid projects, for the time being, but awards are a question. GBC has called the Budget Division for a better understanding of their intent and to find a way to keep funds flowing. 

This may be a short-term issue or a long, difficult spring. It is all part of the political gamesmanship going on between the Governor and Legislature on how to solve this crisis. They may seek to use the State's contractors, vendors and other recipients of state money to try to leverage each other. 

Each Member should review all this if you have State work or work that depends especially on hard State dollars for support. The front page of today's New York Times carries an excellent overview of the subject. It is impossible to judge where this is going, but GBC will continue to work on it. 


E-Mailing List Helps Save GBC $$!
Over two-thirds of GBC Member firms now receive their GBC Reports and other GBC mailings by e-mail. We hope soon to discontinue sending notices by fax and switch everyone over to e-mail, a move that will save us time and money. If you have an e-mail address, but have received this GBC Reports by fax, please call Pam at GBC, 518-869-2207. She'll be glad to switch you over to the e-mail list.


GBC and iSqFt Sign Agreement 
GBC would like to officially announce that we have signed a formal partnership agreement with iSqFt, a technology product of Construction Software Technologies Inc. (CST) of Cincinnati, Ohio. iSqFt is an internet-based tool for general contractors that automates the entire bid process. Over two years ago AGC of America put together a task force to analyze over 200 technology firms to uncover those that they felt provided the best business tools for GCs. After analyzing the financials, code and staff of each firm, AGC picked iSqFt and Primavera as the two firms with whom to sign a first-ever partnership agreement. 

Over the past few weeks iSqFt founder Phil Ogilby and GBC staffer Brendan Manning have been providing in-house demonstrations of the iSqFt Construction Office. We are happy to say that we have our first two members signed on with iSqFt and more ready to follow. If you would like to schedule an in-house demo, please contact Brendan at GBC. 

If you can't find the time to schedule an iSqFt visit, you can attend an online "real-time" demonstration of their Private Internet Construction Office every Monday and Friday. Just visit www.isqft.com and click on the Seminars tab on the left side. From there you will be directed to a page where you can click on a pull-down menu with dates and times for the next two months. Select one of the dates and register - it's that simple. Once you register you will be given an 800 number to dial on the day of the demo so you can ask questions of Phil during the demonstration, all from the comfort of your office. 


Welcome New Members!
We're pleased to welcome the following new Members:
General Contractor: Marson Contracting Co. Inc., Bronx. Represented by Leon D. Marrano III, President.

Specialty Member: Henderson-Johnson Co., Inc., Syracuse. Represented by Lloyd F. Martin, Jr., President.

Associate Members: P.J. Brennan & Associates, Ardsley. Represented by Patrick J. Brennan, CSHM.
Margolin, Winer & Evens LLP, Garden City. Represented by Martin L. Waitz, Partner.


Labor Law 240-241: Assembly Co-Sponsors Sought!
This week saw the industry's lobbying effort on Labor Law 240-241 turned up a notch. The homebuilders were in town in droves working on this issue. Assemblyman Joe Morelle of Rochester has agreed to sponsor our reform bill in the State Assembly. He joins Buffalo Senator Dale Volker, who has already introduced a Senate version of the bill (S.1710). Mr. Morelle is a six-term Democrat from the Rochester area and has been committed to fixing this problem for years. He is now circulating the bill for co-sponsorship and we hope to have an Assembly number next week. We need Assembly Democrats to join the fight and put their name on this bill. GBC is working Majority Assembly Democrats. Members are urged to do the same, upstate and down. We will begin in earnest to ask Members to meet with local legislators in their districts in the coming weeks to work this issue. We trust you will all be eager to do so. 


OSHA Announces New Enforcement Program for Construction
On February 13th, OSHA director John Henshaw announced the agency would be strengthening its enforcement and inspection efforts in construction in the coming year as it seeks to reduce the number of workplace injuries, fatalities, and illnesses. He said that the agency has not in recent years done an adequate job of targeting the bad players in the construction industry and remedying the safety problems they create. Henshaw stated, "We will improve our targeting of construction. Our intent is to go to those workplaces that need enforcement as an incentive to drive performance with respect to a safe workplace. We do not want to be part of a cycle where we continue to issue fines, they pay the penalty, and work continues and hazards continue. We have got to get out of that cycle." 

Resource limitations permit OSHA to inspect only about 2% of the facilities subject to the OSH Act. Henshaw said that the agency needs to develop better strategies for targeting employers for inspections and investigations. He said OSHA has a good system for targeting employers in general industry, but has been less successful with respect to the construction industry. If the agency can do a better job of targeting, OSHA would be able to attack the most egregious players and free conscientious employers from the inspection process.


Small Business Day - March 25th
The Business Council and National Federation of Independent Businesses will hold their annual small business day on Tuesday, March 25, 2003 in Albany. There will be a morning program and afternoon lobbying. Governor Pataki and the Legislative leaders have been invited to speak. One of the morning panel discussions will be on "unfair" tort laws. The GBC Executive Director will be one of the panelists. We know you're all busy, but this is another way to ensure that your voice is heard. If you have the time, come to Albany in two weeks and make an investment in your business. Details on the meeting are available from the Business Council and the GBC.


Mandate Relief - Is This the Year for Wicks Change?
GBC has been working on and reporting on this issue for years. In 1993 in the last years of the Cuomo administration we thought we had a reform deal. In recent years the school groups on their own initiative have been working on this issue again. The Governor has now offered total repeal as a budget-saving device. Assemblyman Steve Sanders of Manhattan and Senator Nick Spano have re-introduced a bill that has been around for years to repeal the law, but require the listing of Wicks subs at the time of bid. Last week that bill was reported out of the Assembly Local Governments Committee. Also, last week, the Senate included the issue in its mandate relief proposal. Their approach is to raise the dollar limits. 

The Wicks contractors themselves have endorsed a bill that would increase the dollar threshold from $50,000 to at least $500,000 upstate and higher downstate with a phased increase going even higher. Labor has traditionally been split on this issue. The laborers last week reiterated their support for a change, but they also talked about the need to package other reforms to the low responsible bidder and prevailing wage laws. 

Since this has the potential to be a budget savings issue, maybe as much as 10% or more on the total building capital budget, it will be an issue that could get hot. GBC has always promoted freedom of choice for public owners on this issue. The public owners clearly could use a threshold increase, at the minimum. As they say, the devil is always in the details. We shall see.


Construction Career Days Updates
Capital Region Members should be in receipt of information regarding sponsorship opportunities for the 2nd Annual Capital District Construction Career Days program. This year the committee did not receive the Federal funding that assisted development of last year's program. The two-day event, scheduled this year for April 9-10, was a huge success last year in introducing students to careers in construction, and the committee decided to move forward with a second year's program. If you would like more information please contact Brendan Manning at the GBC. 

Also, the Mohawk Valley Construction Industry Workforce Development Committee has organized the first ever Mohawk Valley Construction Industry Career Day for May 9, 2003 at Griffiss Technology Park in Rome, NY. The Committee is looking for sponsorships and volunteers to assist with the program. Please contact Jack Endryck at the Mohawk Valley Builders Exchange at 315-624-0276 for more information. 


Your Name in Lights!
Well, maybe not exactly in lights, but on the GBC's homepage! We're planning a new website feature tentatively called "GBC Member Project of the Month." We'll feature a photo of your project with a short description and a link to your company website. 

You may submit information for this feature to pamm@gbcnys.agc.org, or mail to Pam Martin at the GBC. Include a photo of the project - it is important that the photo be under 60k and in .jpg format. If you can't submit an electronic file, send a good-quality photo and we can scan it here. Also include a short description of the project (no more than 40 words), including location and completion date. Finally, include your website address, if you have one. We'll use the submittals on a first-come, first-served basis.


Upcoming Events
Please check the GBC Calendar for a complete list of upcoming events, with links to registration forms.