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The San Francisco Chronicle wants to know how you or someone you know has been affected by California’s delay on state-funded infrastructure due to the State’s current budget mess. The SF Chronicle has asked for my help in researching to write an article about this subject. Your timely feedback to this discussion is greatly appreciated.
by William K. 1 year ago, 68 days ago
As the President, CEO of a large reginonal General Contractor that self-performs all structural concrete operations, I am extremely disappointed in the irresponsible approach the California Legislator has take in this matter. As many have acknowledged, or should have, this action only worsens the current economic conditions. By freezing funds on projects that companies, employees and thier families have made committments to and lost or forgone other opportunities, these people are now trust into sever financial hardship as a direct and proximate result of California's Legislature. Yet, we see no financial hardship being trust upon them. This type of saber ratteling is not only useless and ill-timed, but hurts the very people that it is suppose to protect. Our Firm has had the very unfortunate and distasteful task to inform dozens of men and women that they would be layed off until the California Budget issues is resolved by those currently elected officials whom we believe will enjoy the Holidays much more than the masses they represent. At this point, we are extremely dishartented by the Legislator's actions
by Toby C. 1 year ago, 71 days ago
This is quite the challenge to our industry. Golden Gate ABC represents over 590 contractors in the Nor Cal area. We sent an update out to our membership regarding the issue and one of our members responded with the following information. As you can see this impacts more than the business owners and legislators playing politics in Sacramento. This impacts the everyday worker that the legislator always claims to be protecting. See the quoted information below. "Thank you for the update. I just learned this morning that our past due progress payment will be frozen as well. We just completed a Historic Preservation Project in Amador County (property owner) and have been waiting for our October progress payment of $89,997.66. The payment was due November 30th. We were told that the money, (CCHE reimbursement grant funds) would be paid before Christmas. Upon opening my e-mail this morning, I too was informed that our money has been frozen by the PMI Board members. This project is 100% complete. We have billed out complete totaling $192,659.98 in balance due on a $398,758.00 contract. That is what is due our company, a small construction company and member of ABC. We have completed our contract obligations at our companies expense in good faith, that the State had sold the required bonds to fund the Grant, to reimburse the owner, to pay us. Now instead of payment, we are in receipt of the news that we will not see money owed us until a financial plan is put into place to address the budget deficit. I would just like to know if the State bureaucrats are going to cancel their Christmas plans as we have been forced to do. As a small company with no work on the books at this time, we will be forced to make additional layoffs, scale even further back than we already have due to the down turn in the economy, and maybe even close our doors. Let me know how we can support ABC's efforts to combat this travesty in budget management by our State. Regards,"
by Brian D. 1 year ago, 72 days ago
From my seat it is hard to separate the impacts from the Legislature's irresponsible inaction on the budget and the greater impact of the irresponsible and greedy actions of the Banking Industry. In any event most of the infrastructure projects in my area have dried up. Without committment of State and/or Federal funding, or funding through bonds or other financial instruments typically used by Jurisdictions for the construction of infrastructure projects nothing will come back off the pending shelf. I typically work as an independent contractor for Construction Inspections through various Civil Engineering companies in the area......all of the work we had discussed for CM services that was to begin in Summer to Fall of 2008 is no longer there. The hughe addition to the Thunder Valley Casino went silent about a month ago, and the Hwy 65 Bi Pass project has been slowed to winterizing the site and is in immenent danger of being closed due to lack of funding. My wife is a Commercial Insurance Broker and the hard hit taken by the Construction Industry in Northern California has had a dramatic effect on her business as well. Charge Backs from Unearned Premiums caused by policy cancellations from General and Sub Contracting firms alike has decimated her cash reserves and sh is now lucky to pay her bills.
by Brian F. 1 year ago, 74 days ago
This is not only affecting the California market, but it is similar across the country. I am a general contractor in the Kansas City, MO area and the previous comments posted are mirrored in this part of the country. Dennis Woodward made a comment on the residential contractors competing against commercial or public works contractors because of the residential decline. We usually compete in government and municipal projects such as schools, municipal buildings and military facilities. Historically we have bid against 4 or 5 other qualified contractors, but this past year because of the residential/multifamily market slowdown the number of contractors looking for new lines of revenue have grown tremendously. An example of this was an armory project that would normally receive 3 or 4 proposals to complete the scope of the work ended up receiving 18. That may seem like it's good competition and good for the owner, but 12 of the contractors submitting the bid were not qualified to complete the work. This leaves contractors like my company, with over 50 years experience, competing with "starving" companies who will do almost anything to get by. Not only that, but I recently had to negotiate with a bonding company for a failed project because one of these contractors could not finish the project and closed their doors.
by Bill B. 1 year ago, 74 days ago
I work for an engineering firm based in Sacramento that has construction management contracts with CalTrans and design contracts in the private sector, both of which have been impacted by the current budget snarl: Caltrans projects for obvious reasons and the private sector contracts because they have been award Proposition 1b dollars that has now been frozen. While no official shutdown has occurred on any of the projects, no one is making any new moves until the picture becomes clearer.
by Dennis W. 1 year ago, 77 days ago
I am the Bond Department Manager at R.C. Fiscerh & Co. I began seeing the impacts of the current economic downturn, which impacted construction when new residential construction came to a halt. Many contractors that normally would do residential constructon found themselves competing with contractors who primarily peform public works and commercial construction. The number of projects out to bid began to slow dow about 3 months ago. The result is that most projects out to bid have a large number of bidders and the pricing, in many cases, has come in well below the engineers estimate, and in some cases, well below the project costs. With our State governement unable to pass a reasonable budet, and with the freeze on construction funds for projects either already started or ready to go for bid, the amount of work available is dropping off. The result is that I am seeing most of my contractor clients significantly down grading their estimates for gross revenue and payroll for fiscal 2009. Because of the economic downturn and the resulting negative impact on the balance sheet of most contractors, the bonding companies have tightened up on their underwriting. The good news, at least for the time being, is that the General Liability rates have dropped significantly for most construction classification. However, the Workers Compensation Insurance rates have been to creep up. If President Obama's economic stimulus plan is put into place as advertised, it should have a positive impact on the construction industry. Contractors need to clean up their balance sheets and retain as much net income in order to boost their net equity to be in a position to get some of the work that will be available to bid.
by John G. 1 year ago, 77 days ago
As an Electrical Contractor heavily vested in K-12 Education contracts our work has been directly impacted. We have been forced to layoff 10 Electricians this month (Merry Christmas) due to State Matching funds being frozen and that affect on the sell of bonds by the local districts. Its time the elected officials earn their pay and get a budget approved with less spending on junk issues which they all hold dear to their special interest. The stimulus package promised will "make work" on roads and bridges but there are not many electrician jobs there.
by Richard K. 1 year ago, 77 days ago
When I worked CalTrans projects they were funded by the California gas tax and could be funded regardless of the overall budget. This was due to the fact all of the monies collected for state gas tax went directly to CalTrans. Has something changed? I am no longer involved in CalTrans work but my brother has told me he has been literally shut down for several months because of the budget mess. Here in Texas a local radio host has calculated that if we raised the state gas tax by $.05 per gallon, we could almost immediately duns all of the scheduled projects for the next 10 years.
by Steve M. 1 year ago, 77 days ago
This hasn't effected me directly yet but the whole economy downturn has. My small construction business has had the worst year yet, as many clients hold onto their money for projects just in case they need it for the future.
by Wayne G. 1 year ago, 77 days ago
Many contractors, both West Coast and East Coast, have experienced significant downturns in their respective markets. As is the case in the Philadelphia marketplace, several large construction employers will be making additional and significant workforce reductions immediately after the holidays in an attempt to keep their key employees as long as possible. I am quite confident that West Coast construction employers are doing the same. With a quick influx of dollars placed into infrastructure repair and development, that increase in construction unemployment would be significantly less as a result of that excess capacity being shifted to those new projects.
by Larry T. 1 year ago, 77 days ago
This has happened in California before when the legislature has problems meeting its duties. Caltrans projects are usually hit first and other infrastructure projects follow. The stimulus package is nice but what is backing the money? Sooner or later we will have to pay the piper. If we move to quick, inflation could increase and we have traded one problem for another.
by Kevin K. 1 year ago, 77 days ago
I run a fringe benefit fund that will definitely reveal the extent of the delays but probably not until we get deep into January.
by Mark P. 1 year ago, 77 days ago
Nothing yet but the New Year may tell a different story
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