{"id":59280,"date":"2009-01-26T15:04:50","date_gmt":"2009-01-26T15:04:50","guid":{"rendered":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/article\/going-public_o"},"modified":"2009-01-26T15:04:50","modified_gmt":"2009-01-26T15:04:50","slug":"going-public_o","status":"publish","type":"post","link":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/how-to\/construction\/going-public_o\/","title":{"rendered":"Going Public"},"content":{"rendered":"

Masonry contractors should keep their eye on the public construction market in 2009 and beyond, as there are some signs pointing to increased spending in this market segment. The durability, safety, and low maintenance of masonry continue to make it a top choice for highly trafficked public facilities.<\/p>

President-elect Barack Obama’s economic stimulus plan includes $25 billion for rebuilding roads, bridges, and schools. According to the Associated General Contractors (AGC), 3000 highway projects totaling approximately $18 billion, and water and wastewater infrastructure work amounting to $10 billion, are ready to start within 30 – 90 days from enactment. Other backlogged public works programs would also create immediate opportunity.<\/p>

The long-term outlook for public construction looks positive as well. The new president wants to create a National Infrastructure Reinvestment Bank to expand and enhance existing federal transportation investments. He also favors updating our aging school facilities to improve their environment, while increasing energy efficiency<\/p>

This outlook is good news for masonry contractors. However, public construction operates very differently than the private market. Jumping in without proper planning could prove disastrous. Complicating matters is a growing interest by government agencies to explore alternative project delivery methods and Building Information Modeling (BIM) technology.<\/p>

Demands of public construction<\/strong> <\/p>

\u201cIn many cases, the requirements for quality are a bit higher on public projects,\u201d said Bruce Cornwall, project principal and designer for Duluth, Minn.-based LHB, whose public work includes the National Eagle Center, Wabasha, Minn. \u201cThere is more craftsmanship involved.\u201d<\/p>

Darold Berger, owner of Berger Masonry, whose Waukon, Iowa, firm constructed the National Eagle Center from brick, cast stone, and concrete masonry, concurs with Cornwall. \u201cThe building is a source of pride for both the contractor and community,\u201d he said. A stunning sculpted eagle emerges out of the brick facade, matching the veneer with colored grout. It was constructed in 90 bricklayer hours and 45 labor hours.<\/p>

\u201cPublic projects are more demanding in the sense that the client is often more sophisticated,\u201d according to Sinan Sinanian, president of Sinanian Development Corp., a general contracting firm based in Tarzana, Calif., who was involved in the Folsom Public Library job. \u201cIn many ways, it is much better than private work.\u201d<\/p>

On the construction of the Valley Recruit Training Facility, CMU was selected for its strength, ease of construction, and economics. The only real challenge was related to schedule. \u201cThe general contractor faced damages if the job was not completed in a certain number of days,\u201d explained Jora Kirimi, president of La Crescenta, Calif.-based ARC – Accucon Construction. The masonry contractor assigned his most experienced project manager and as many workers as possible to the job when heavy rains threatened to jeopardize the schedule.<\/p>

In addition to increased supervision, masonry contractors must contend with additional paperwork on public projects. All federal government construction contracts, and most work for federally-assisted buildings, must include provisions for paying workers no less than the locally prevailing wage and benefit packages found on similar projects. This provision can be cumbersome for non-union contractors, according to Karimi.<\/p>

He advises masonry contractors to have all their paperwork for materials turned in on time to avoid cash shortfalls. \u201cUnless they have all the paperwork received by a certain date, you won’t get paid,\u201d Karimi concluded.<\/p>

Winning the bidding war<\/strong> <\/p>

Historically, most public work employs the design-bid-build delivery method. Competitive bidding among general contractors, performance bonds, and other statutory requirements protect taxpayers’ investments. Final selection is based on the lowest bid or total contract price.<\/p>

Three of the four projects profiled in this article were design-bid-build jobs. In each case, the masonry contractors were invited to submit bids by the general contractor.<\/p>

\u201cIt is extremely important to have friends at the general contractor,\u201d said Kirimi. \u201cThey may call you if your price is unattractive.\u201d To minimize shopping by the general contractor, subcontractors routinely send their bids at the last possible moment.<\/p>

In the case of the Valley Recruit Training Facility, the general contractor called Kirimi after he submitted his bid and asked if the company could do the work for a specific amount. \u201cEither he had a lower bid than mine, or knew it would take that number to get the project,\u201d he reasoned.<\/p>

Subcontractors should let the general contractors know they are interested in bidding, and provide references and a list of completed projects. Paid subscription services can provide masonry contractors with a list of projects in their area. Berger, who started out doing masonry jobs on the side and now employs 20 – 40 workers, advises companies to first establish a track record with successful smaller commercial work.<\/p>

In cases where subcontractors bid directly on projects, only those firms meeting the prequalification requirements will be allowed to submit. Information on management personnel, project experience, safety records, references, and bonding capacity will be among the information required.<\/p>

Competition heats up<\/strong> <\/p>

Competition on public construction projects has increased dramatically in recent months as private work has slowed to a crawl, or worse, in many areas. \u201cPrices have reached the point where they were four or five years ago,\u201d said Karimi. \u201cA contractor has to bid more projects with a smaller profit margin to stay afloat.\u201d Nearly all the masonry contractors interviewed for this article have seen a shift in their business mix towards more public construction.<\/p>

Denny Ross, owner of Urbandale, Ia.-based Ross Masonry, has noticed some incredibly low pricing from some masonry contractors in recent months. \u201cThey bid an $800,000 job at $410,000,\u201d said Ross. They get the work, but at a heavy price. It is not uncommon to see the low bid contractors go under in the middle of the job.<\/p>

To win the Iowa State Capital project, Ross bid on work that was a little out of the company’s comfort zone. Only three bids were submitted, and Ross had a good relationship with Larson Construction, the general contractor on the project. This niche approach is helping Ross weather the current market downturn.<\/p>

When extremely low numbers come in, Sinanian reports that generals will typically call the subcontractors and ask them to review their bid. If it still comes back low, the general may demand a performance bond for the amount.<\/p><\/div>

\u201cSubcontractors can always withdraw their bid, but we, as the general contractor, are stuck with the price,\u201d said Sinanian. \u201cSince subcontractors will usually submit bids to multiple general contractors, not using a low price may mean the difference between winning and losing the work.\u201d<\/p>

Kirimi also likes projects with fewer bidders, which often means doing renovation work. \u201cI happen to like those projects because of the challenge associated with all the hidden unknowns. There is a potential for change orders, and I am good at seeing them.\u201d<\/p>

Alternative delivery methods<\/strong> <\/p>

In the design\/bid\/build process, owners are often in the middle, resolving differences between designers and contractors. Contentious relationships, litigation, delays, change orders, and higher costs are common. Consequently, owners are increasingly turning to alternative methods of delivery for their projects.<\/p>

Legislative change may be required to allow government agencies to utilize other delivery methods. For example, in September 2008, California legislators expanded the power of cities to enter into design-build contracts.<\/p>

\u201cThe low bid public process really is broken,\u201d said David Ross, architect on the Folsom (Calif.) Public Library. \u201cFundamentally, it is not a cost-effective or quality-effective means of delivery.\u201d<\/p>

Green building is another trend that is not easily accomplished under the traditional design-bid-build method. \u201cI think that green building is highlighting the deficiencies of the public bid process,\u201d said Ross. \u201cContractors seem to think of it as an extra burden on them.\u201d<\/p>

Integrated project delivery systems foster a partnership between the owner, architect, contractor, and subcontractors. On the National Eagle Center project, principal and designer Bruce Cornwall encouraged the city to enter into a negotiated agreement with a contractor for a guaranteed price. Rochester, Minn.-based Weiss Builders was selected as the general contractor. Working as a team, the designer, general contractor, and owner came up with the best design for the budget.<\/p>

Weiss then solicited bids from subcontractors. Instead of accepting only the low bid, all submittals were evaluated by the team and the most appropriate bids were selected. While cost was an important factor, decisions were not made solely on price.<\/p>

Building Information Modeling (BIM) is an emerging technology that will transform the way some construction projects are planned and managed. BIM allows a virtual information model to be shared among the design team, general contractor, subcontractors, and owner. Each party can add its own discipline-specific knowledge and tracking of changes. BIM promises to reduce the information loss that occurs when plans pass from one entity to another, and allows for early detection of potential design and scheduling conflicts.<\/p>

The expansion of alternative delivery methods and BIM has important ramifications for masonry contractors. A subcontractor’s ability to create value, adhere to rigorous standards, utilize new technologies, and improve processes will undoubtedly become increasingly important to their success.<\/p>

With more public work down the road, masonry contractors should examine the steps they need to take to be competitive in this market. And while low bidders will grab the bulk of this business in the near term, the future may belong to companies who can adapt to a changing environment and new requirements.<\/p>

Joanne Costin is a freelance writer and president of Costin Custom Communications. She can be reached at jcostin@costincustom.com.<\/a><\/em><\/p><\/div> ","protected":false},"excerpt":{"rendered":"

Masonry contractors should keep their eye on the public construction market in 2009 and beyond, as there are some signs pointing to increased spending in this market segment. The durability, safety, and low maintenance of masonry continue to make it a top choice for highly trafficked public facilities. President-elect Barack Obama’s economic stimulus plan includes […]<\/p>\n","protected":false},"author":0,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"scheduledNewsletterDates":[],"_scheduled_newsletter_id":0,"footnotes":"","jetpack_post_was_ever_published":false,"zonda_content_type_url_append":"_o","zonda_dfp_zone":"","zonda_exclude_recommended_contents":false,"zonda_exclude_most_popular":false,"zonda_exclude_tagged_results":false,"zonda_eyebrow":"","zonda_last_newsletter_date":"2099-12-31T23:59:59.999-05:00","zonda_original_url":"","zonda_pdf_version":0,"zonda_print_headline":"Going Public","zonda_promo_abstract":"Working on government projects requires a new set of demands and considerations for the masonry contractor.","zonda_promo_headline":"","zonda_promo_image":0,"zonda_subheadline":"Working on government projects requires a new set of demands and considerations for the masonry contractor."},"tags":[],"news_item_type":[28],"section_10":[80713],"subject":[1023,277,1119,1340,152,950],"organization":[593],"award":[],"person":[],"product_type_10":[],"content-group":[],"event":[],"location":[],"state":[],"brand":[84326],"jlc-category":[],"year_tax":[],"sponsor":[],"coauthors":[85501],"class_list":["post-59280","post","type-post","status-publish","format-standard","hentry","news_item_type-article","section_10-construction","subject-alternative-materials","subject-bim","subject-brick","subject-design-build","subject-government-projects","subject-masonry-construction","organization-american-subcontractors-association","brand-masonry-construction"],"yoast_head":"\nGoing Public<\/title>\n<meta name=\"description\" content=\"Working on government projects requires a new set of demands and considerations for the masonry contractor.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/how-to\/construction\/going-public_o\" \/>\n<link rel=\"next\" href=\"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/how-to\/construction\/going-public_o\/2\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Going Public\" \/>\n<meta property=\"og:description\" content=\"Working on government projects requires a new set of demands and considerations for the masonry contractor.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/how-to\/construction\/going-public_o\/\" \/>\n<meta property=\"og:site_name\" content=\"Concrete Construction Magazine\" \/>\n<meta property=\"article:published_time\" content=\"2009-01-26T15:04:50+00:00\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data1\" content=\"8 minutes\" \/>\n\t<meta name=\"twitter:label2\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data2\" content=\"Joanne Costin\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/zonda-develop.go-vip.net\\\/concrete-construction\\\/how-to\\\/construction\\\/going-public_o#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/zonda-develop.go-vip.net\\\/concrete-construction\\\/how-to\\\/construction\\\/going-public_o\\\/\"},\"author\":{\"name\":\"\",\"@id\":\"\"},\"headline\":\"Going Public\",\"datePublished\":\"2009-01-26T15:04:50+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/zonda-develop.go-vip.net\\\/concrete-construction\\\/how-to\\\/construction\\\/going-public_o\\\/\"},\"wordCount\":1556,\"inLanguage\":\"en-US\"},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/zonda-develop.go-vip.net\\\/concrete-construction\\\/how-to\\\/construction\\\/going-public_o\\\/\",\"url\":\"https:\\\/\\\/zonda-develop.go-vip.net\\\/concrete-construction\\\/how-to\\\/construction\\\/going-public_o\",\"name\":\"Going Public\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/zonda-develop.go-vip.net\\\/concrete-construction\\\/#website\"},\"datePublished\":\"2009-01-26T15:04:50+00:00\",\"author\":{\"@id\":\"\"},\"description\":\"Working on government projects requires a new set of demands and considerations for the masonry contractor.\",\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\\\/\\\/zonda-develop.go-vip.net\\\/concrete-construction\\\/how-to\\\/construction\\\/going-public_o\"]}]},{\"@type\":\"WebSite\",\"@id\":\"https:\\\/\\\/zonda-develop.go-vip.net\\\/concrete-construction\\\/#website\",\"url\":\"https:\\\/\\\/zonda-develop.go-vip.net\\\/concrete-construction\\\/\",\"name\":\"Concrete Construction Magazine\",\"description\":\"\",\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\\\/\\\/zonda-develop.go-vip.net\\\/concrete-construction\\\/?s={search_term_string}\"},\"query-input\":{\"@type\":\"PropertyValueSpecification\",\"valueRequired\":true,\"valueName\":\"search_term_string\"}}],\"inLanguage\":\"en-US\"}]}<\/script>\n<!-- \/ Yoast SEO Premium plugin. -->","yoast_head_json":{"title":"Going Public","description":"Working on government projects requires a new set of demands and considerations for the masonry contractor.","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/how-to\/construction\/going-public_o","next":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/how-to\/construction\/going-public_o\/2\/","og_locale":"en_US","og_type":"article","og_title":"Going Public","og_description":"Working on government projects requires a new set of demands and considerations for the masonry contractor.","og_url":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/how-to\/construction\/going-public_o\/","og_site_name":"Concrete Construction Magazine","article_published_time":"2009-01-26T15:04:50+00:00","twitter_card":"summary_large_image","twitter_misc":{"Est. reading time":"8 minutes","Written by":"Joanne Costin"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/how-to\/construction\/going-public_o#article","isPartOf":{"@id":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/how-to\/construction\/going-public_o\/"},"author":{"name":"","@id":""},"headline":"Going Public","datePublished":"2009-01-26T15:04:50+00:00","mainEntityOfPage":{"@id":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/how-to\/construction\/going-public_o\/"},"wordCount":1556,"inLanguage":"en-US"},{"@type":"WebPage","@id":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/how-to\/construction\/going-public_o\/","url":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/how-to\/construction\/going-public_o","name":"Going Public","isPartOf":{"@id":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/#website"},"datePublished":"2009-01-26T15:04:50+00:00","author":{"@id":""},"description":"Working on government projects requires a new set of demands and considerations for the masonry contractor.","inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/zonda-develop.go-vip.net\/concrete-construction\/how-to\/construction\/going-public_o"]}]},{"@type":"WebSite","@id":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/#website","url":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/","name":"Concrete Construction Magazine","description":"","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/?s={search_term_string}"},"query-input":{"@type":"PropertyValueSpecification","valueRequired":true,"valueName":"search_term_string"}}],"inLanguage":"en-US"}]}},"jetpack_sharing_enabled":true,"distributor_meta":false,"distributor_terms":false,"distributor_media":false,"distributor_original_site_name":"Concrete Construction Magazine","distributor_original_site_url":"https:\/\/zonda-develop.go-vip.net\/concrete-construction","push-errors":false,"jetpack_featured_media_url":"","_links":{"self":[{"href":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/wp-json\/wp\/v2\/posts\/59280","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/wp-json\/wp\/v2\/comments?post=59280"}],"version-history":[{"count":0,"href":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/wp-json\/wp\/v2\/posts\/59280\/revisions"}],"wp:attachment":[{"href":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/wp-json\/wp\/v2\/media?parent=59280"}],"wp:term":[{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/wp-json\/wp\/v2\/tags?post=59280"},{"taxonomy":"news_item_type","embeddable":true,"href":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/wp-json\/wp\/v2\/news_item_type?post=59280"},{"taxonomy":"section_10","embeddable":true,"href":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/wp-json\/wp\/v2\/section_10?post=59280"},{"taxonomy":"subject","embeddable":true,"href":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/wp-json\/wp\/v2\/subject?post=59280"},{"taxonomy":"organization","embeddable":true,"href":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/wp-json\/wp\/v2\/organization?post=59280"},{"taxonomy":"award","embeddable":true,"href":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/wp-json\/wp\/v2\/award?post=59280"},{"taxonomy":"person","embeddable":true,"href":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/wp-json\/wp\/v2\/person?post=59280"},{"taxonomy":"product_type_10","embeddable":true,"href":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/wp-json\/wp\/v2\/product_type_10?post=59280"},{"taxonomy":"content-group","embeddable":true,"href":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/wp-json\/wp\/v2\/content-group?post=59280"},{"taxonomy":"event","embeddable":true,"href":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/wp-json\/wp\/v2\/event?post=59280"},{"taxonomy":"location","embeddable":true,"href":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/wp-json\/wp\/v2\/location?post=59280"},{"taxonomy":"state","embeddable":true,"href":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/wp-json\/wp\/v2\/state?post=59280"},{"taxonomy":"brand","embeddable":true,"href":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/wp-json\/wp\/v2\/brand?post=59280"},{"taxonomy":"jlc-category","embeddable":true,"href":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/wp-json\/wp\/v2\/jlc-category?post=59280"},{"taxonomy":"year_tax","embeddable":true,"href":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/wp-json\/wp\/v2\/year_tax?post=59280"},{"taxonomy":"sponsor","embeddable":true,"href":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/wp-json\/wp\/v2\/sponsor?post=59280"},{"taxonomy":"author","embeddable":true,"href":"https:\/\/zonda-develop.go-vip.net\/concrete-construction\/wp-json\/wp\/v2\/coauthors?post=59280"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}