THE VOICE OF THE CONSTRUCTION INDUSTRY OF GEORGIA
CONTRACTOR Volume 7, Issue 6
November | December 2011
TRANSPORTATION INVESTMENT ACT 2010 STORY ON PAGE 6
Letter from the Editor November | December 2011
ADVERTISEMENTS AIA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 A4 Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
ATC. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 CardnoTBE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
This is the last issue of 2011. Unbelievable, but true. Time flies, and, frankly, most of us do not mind leaving this year behind us. There is hope, however, that 2012 might just turn out to be an improving year for transportation construction. The passing of the Transportation Investment Act of 2011, which calls for a referendum in July 2012 on a one percent sales tax for ten years ,may just be spark for change. We trust that the public involvement and education will yield a positive election outcome. Should this important bill pass, it will almost double the available funds for transportation investments in Georgia. The feature article, Transportation Investment Act 2010, is a comprehensive analysis of what the plan calls for. It is an excellent presentation and will lead the way for all transportation construction companies, engineers, and anyone interested in the growth and competitiveness of Georgia to strongly support this referendum. We also want to keep in mind that â€œevery $1 billion we spend on transportation improvements supports 28,000 jobs and generate more than $2,5 billion in economic activity throughout out state,â€?as states Heath Garrett with Connect Georgia, the advocacy campaign of the Georgia TransportationAlliance. This is one of the most important referendums to be held in Georgia, and every effort must be made to persuade the public to vote in its favor. Housing construction is not expected to improve much, though there are signs of life, and we might see a small uptick in construction activities in 2012. Maybe 2011 has seen the bottom of this construction cycle. The depression in the housing industry was caused by governmental policies calling for everyone to own a house whether he/she was financially able to handle such an investment. We will be wading through this mess for another year or so until all of the excess housing inventory has been absorbed. So, 2012 may well be the beginning of a better construction climate, not because of policies pursued in Washington, but because of what Georgia is able to do for itself.
Cummins Power . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 Engineered Restorations Inc. . . . . . . . . . . . . . . . . . 15 Georgia Power . . . . . . . . . . . . . . . . . . . . . . . . 19, 29 Golder Associates . . . . . . . . . . . . . . . . . . . . . . . . . 22 HeavyQuip . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 HNTB . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 JAT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 LPA Group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 MidSouth Machine & Service Company. . . . . . . . . . 11 NES Rentals . . . . . . . . . . . . . . . . . . Inside Front Cover Prime Engineering . . . . . . . . . . . . . . . . . . . . . . . . . . 3 RHD . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Silt-Saver . . . . . . . . . . . . . . . . . . . . . Inside Back Cover T. Wayne Owens & Associates, PC . . . . . . . . . . . . . 20 Utilities Protection Center . . . . . . . . . . . . . . Back Cover Willmer Engineering. . . . . . . . . . . . . . . . . . . . . . . . 25
Merry Christmas to all of our readers and more prosperous New Year.
R. Petersen-Frey Editor-in-Chief
November | December 2011
On The Cover
The Georgia Contractor www.thegeorgiacontractor.com Managing Editor R. Petersen-Frey (770) 521-8877 Advertising Director Bo Ingram (770) 761-5920 Art Director Pamela Petersen-Frey (770) 521-8877
TRANSPORTATION INVESTMENT ACT 2010 On August 15, 2011, all of the Regional Commissions submitted their constrained improvement project lists to the GDOT in preparation for the regional tax referendum. This article traces the steps and organizational issues for the Atlanta Region and the eleven other regions. See the story on page 6
The Georgia Contractor is published bi-monthly on a calendar year basis. It is a magazine designed around the construction industry associations and their members. It is supported by associations and their members. Executive, editorial, circulation, and advertising offices: 1154 Lower Birmingham Road, Canton, Georgia 30115 â€˘ Phone: 770.521.8877 â€˘ Fax: 770.521.0406 e-mail: email@example.com. Send address changes to your association and/or to TGC Publishing LLC. Opinions expressed by the authors are not necessarily those of any of the associations or publisher nor do they accept responsibility for errors of content or omission and, as a matter of policy, neither do they endorse products or advertisements appearing herein. Parts of this magazine may be reproduced with the written consent of the publisher.
The Georgia Contractor
November | December 2011
Transportation Investment Act 2010
12 Round and Round We Goâ€Ś
Improve Productivity ~ Identify Your Staffâ€™s Motivating Factors
18 Applying Risk Management to Project Performance
21 Georgia Contractor News
12 26 New Considerations for Joint Venture Agreements
27 Georgia Contractors Business Growth in the Clouds
30 21 November | December 2011
Fall Protection Anchors ~ Exterior Wall Access 5
Transportation Investment Act 2010 By John D. Edwards, P.E. | Honorary Member, ITE On August 15, 2011, all of the Regional Commissions submitted their constrained improvement project lists to the GDOT in preparation for the regional tax referendum. This article traces the steps and organizational issues for the Atlanta Region and the eleven other regions. The discussion of the Atlanta Region separately from all of the other regions is due to the differences in the transportation issues between the regions. The article is divided into several parts: (1) an Organizational Overview, which is common to all regions; (2) the Adopted Selection Criteria, which is generally similar between regions except for the Atlanta Region; (3) the Public Involvement Process; (4) Opportunities for Engineers; (5) Regional Differences, and finally (6) Challenges for Public Support. Organizational Overview By now, most of us should know about the Transportation Improvement Act of 2010 (TIA 2010), which provides for a ten-year referendum for a one-cent regional sales tax for transportation improvements in each of twelve ‘transportation regions’ in Georgia. There has been extensive coverage in the Atlanta Journal Constitution of the projects and program in the ten county metropolitan area. The purpose of this article is to chronicle the events in the regions in Georgia and to highlight the opportunities for the engineering community in Georgia. First, some operational details. These Transportation Region boundaries are coterminous with the Regional Commission boundaries in Georgia established in 2009. This article will discuss the type of 6
transportation improvements selected for inclusion in the tax referendum for the ‘outer eleven’ transportation districts or regions. Regional Roundtables ~ TIA 2010 provided for a ‘Regional Roundtable’ for each of the regions. This article will review the function of the Regional Roundtables and the elements of the selection of the specific projects within the region. One function of the Roundtables was the development of criteria for the inclusion of specific projects. Several steps in the process included: the development of an unconstrained project listing, a constrained project listing, based on the estimated tax money available, and a ‘final project listing.’ Regional Sales Tax ~ TIA 2010 created special tax districts (now referred to as transportation districts” ) and a referendum on a sales tax on goods and services for the purpose of financing transportation improvements. The referendum, if approved, would provide a one-cent sales tax for ten years for improvements within each transportation district. Adopted Selection Criteria One of the most important parts of the process of developing a list of projects for the referendum is the development of project selection criteria. The Georgia DOT provided draft criteria for project selection to the Transportation Districts in October 2010. The criteria included general economic goals and objectives, mobility, and safety. In addition, the criteria included a suggested apportionment of funds for each
mode of transportation. The Regional Roundtables were required to approve and/or modify the apportionment for their own district based upon perceived local needs and wishes. The recommended investment by mode is included in Table 1. Origin of Plans and Project Estimates ~ The projects that were considered came from existing plans and cost estimates that were available, studies in the GDOT Work program, MPO long range plans, short range transportation programs and county transportation studies. Preference was given to projects that could be initiated within the ten-year sales tax period. Table 1 on the next page shows the recommended target allocations by program type. In general, seven of the transportation districts accepted the DOT recommended allocations as presented, and three accepted most of the allocations. ARC, Middle Georgia, Heart of Georgia Altamaha and Three Rivers made substantial revisions or simply combined several of the programs into one or two. In the case of Atlanta, transit is a major consideration, and in the case of Heart of Georgia Altamaha the road and bridge maintenance over river crossings is of major concern. Selection Process ~ The initial financially unconstrained project list included improvements developed by the GDOT Director of Planning. The director developed the list by seeking projects from local governments and MPOs and within GDOT’s work program. The initial list was The Georgia Contractor
Ga 365, Hall County Georgia November | December 2011
Investment CSRA, Allocation Ga. Mountains Target Ranges N. E. Ga; (Percent) N.W. Ga; Ga. DOT River Valley; RecommendS.W. Ga; ation Southern Ga.
Heart of Ga.
Roadway, Bridge Maintenance
Safety, Traffic Ops.
Transit Operations, Maintenance
Table 1 – Program Areas and Modal Targets first an ‘unconstrained draft’ wish list without regard to funding. This ‘unconstrained’ list was provided to the Roundtables for consideration. Specifically, a sub-committee of the Roundtable, called the Executive Committee, used the list as a starting point. This first list was produced by a mandated June 1 deadline. A fiscally constrained investment list of projects, using the funding estimate by the state economist from the sales tax for ten years, was used to produce the draft constrained list by a mandated August 15 deadline. The list was then submitted to the Regional Roundtables for final revision and approval. Table 2 illustrates the required reductions from the ‘unconstrained list’ to the ‘constrained list.’ This table gives one an idea of the amount of unmet needs for transportation improvements in each of the regions in the state that 8
Source: Georgia DOT Web site, www.IT3.ga.gov
exist even with the passage of the regional sales tax referendum. The total requested funding for all the Regional Commissions is $45,658,000, 000 over the next ten years, and the total TIA Funding that will be available is estimated at $12,662,600,000. Thus, only about 27.7 percent of the perceived transportation needs will be funded by the sales tax. Regional Differences The project selection process is unique to each Transportation District based on the character and goals of local development, the types of existing transportation facilities, the Roundtable adopted criteria, the level of traffic congestion, and other factors in each region. Rural/Urban Variations ~ One would
expect that there would be differences in the perceived needs of transportation improvements based on the development characteristics of the Regions. This is apparent when one examines the Constrained Project Lists. For example, in the Heart of Georgia Altamaha Region, many major projects are for roadway and bridge maintenance, while in the Middle Georgia Region the emphasis is on economic development and safety with the Fall Line Freeway and improvements to the interchange operations such as the I-16/I-75 interchange in Macon. In the Atlanta Region, the major emphasis is on capital transit investments and transit operational improvements In the River Valley District, a variety of projects in Columbus, including the extension of the Riverwalk, the Intercity Bus and Ride Facility, and the South Lumpkin The Georgia Contractor
Total TIA Funding Requested (millions)
Total TIA Funding Available (millions)
% Required to be Cut
Heart of Georgia
Table 2 – TIA Funding and Project Requests Multiuse Facility (pedestrian, bike trail), attest to the multi-modal character of the TIA 2010. In the Coastal Region, major improvements for widening, improved, and new interchanges are related to I-95 and I-16. These projects will improve freight movement and access to and from the ports and will benefit most of the counties in the region. Another distinction is in the urban/rural transit projects. One would expect that the Savannah and Brunswick urban areas would have substantial allocations to transit improvements but one finds that Liberty County, an urban expansion area for Savannah, has a substantial allocation for a transit system as well. Highway/Transit Differences ~ As pointed out in the previous section, many of the region’s elected officials have the major November | December 2011
Source: Transportation Investment Act 2011, Georgia DOT, August 2011
emphasis of transportation improvements on highway facilities. In fact, except in the Atlanta Metropolitan Region with 52 percent of the investment in transit, the most money is in highway improvements. The Atlanta Region’s proposed investment in transit consists of a variety of components. For instance, operating funds are proposed for bus systems: Clayton County ($100 million), Gwinnett County ($40 million), and the Georgia Regional Transportation Authority for service in several other metro counties ($128 million). For MARTA, $600 million is proposed for maintenance to attain a ‘state of good repair’ in the existing system, and $700 million is proposed for a new heavy rail line to the Emory University/CDC development cluster. A detailed study would be funded to lay the groundwork for intercity passenger rail from Atlanta to Griffin. ‘Premium’ transit
would be provided from the current MARTA station toward Gwinnett County ($95 million), service in South DeKalb County ($225 million), and from the current Marta station toward Cobb County ($695 million). Also included is funding for a major portion of the Beltline trolley in Atlanta ($602 million). Those regions where there is an existing transit operation (Athens, Augusta, Brunswick, Columbus, Macon, Rome, and Savannah) have allocations in the range of 1.26 percent to 11.61 percent of the total regional investment budget. Public Involvement It is recognized that the most difficult part of ‘selling’ the regional sales tax is making the public aware of the program and its benefits. It is always a challenge to convince the general public to increase tax on them9
through the newly created Georgia Transportation Alliance by the Georgia Chamber of Commerce to educate the citizens on all aspects of the referenda and to advocate for passage in the eleven non-Atlanta regions. For the Atlanta Region, two groups have been organized: Citizens for Transportation Mobility (CTM), an advocacy organization, and Metropolitan Atlanta Voter Education Network (MAVEN), an education organization. These groups have hired staff and campaign consultants and they are raising money to support their efforts.
I-285 at the Evening Peak Hour selves, and in these economic times, it is doubly difficult. Recognizing this, the authors of the legislative act provided for a process for the education of the public. The enabling legislation for the referenda mandated full disclosure of the project list to the public through a series of public meetings and via a Web site.
coverage was provided through the news media. In the eleven other regions, local newspapers such as the Athens Banner Herald, Gainesville Daily Times, Augusta Chronicle, Macon Telegraph, Columbus Ledger Enquirer, and Newnan Times- Herald and many others carried articles on the meetings of the Regional Roundtables.
Process ~ The legislation for the program specified a minimum number of two public meetings and two ‘official’ meetings of the Regional Roundtables. Most of the Regional Roundtables exceeded the requirements with some holding five or even more public meetings and up to eight or ten meetings of the Roundtables. A survey of the Regional Commissions by the author indicated most commissions held at least six meetings to secure project requests. Another element of the process was publicity of the program through local newspapers, presentations at civic club meetings, and TV. e Atlanta Journal Constitution has published a series of articles on the program especially for the metropolitan area, and several Regional Commissions reported that extensive local
Status ~ Currently, efforts are underway
Opportunities for Engineers The Transportation Investment Act 2010 (TIA 2010) could provide the funding for major transportation improvements which are required if the state of Georgia is to compete successfully for job growth with other states. As indicated in the 2009 McKinsey and Company Study, “Meeting Georgia Mobility Challenge,” the state is far behind in funding of these important infrastructure elements. Not only does the TIA 2010 provide funding for much needed transportation facilities but it provides benefits to the general economy through jobs and income. Estimates of unemployment for engineers in the Atlanta area have been as high as 24 percent. For engineers, the TIA will provide jobs for many unemployed engineers and technicians. Program Management ~ According to
The Georgia Contractor
officials at GDOT, the approval of the sales tax will almost double the available funds for transportation investments in Georgia (assuming all twelve regions pass the tax). With such a large program, how will project management be handled? The current thought is that several consulting firms with experience in project management could be hired. For individual projects, it is expected that consulting firms will be hired by GDOT to prepare plans for traffic operations, roadways, rights-of-way acquisition, and bridges. These plans will be produced under the direction of the management consultants in a timely manner and to acceptable standards. For capital transit and transit operations plans and programs in the Atlanta Region, the Georgia Regional Transportation Authority (GRTA) will hire the consultants. GRTA plans to work with the local sponsor of the transit project for delivery. The development of plans and the management of the program will be under the authority of GRTA. Individual Project Plans ~ For individual projects, both roadway and transit, some plans are already available due to the issuance of past consulting contracts. It is anticipated that most of these design and planning documents may need some updating due to changing conditions. Updating plans and new plans will be done by DOT and GRTA staff with the assistance of individual consulting firms. Regardless of how the responsibility of the work is allocated, there could be a significant amount of work for consulting firms.
edgeable local officials and citizens drafted and refined the lists of needed projects. Furthermore, the money raised within each region will be spent within that region. The first 75 percent will fund the regional projects on the list. The other 25 percent will be given to each region’s towns and counties to spend on hometown transportation improvements of their own choosing. In the Atlanta Region, there are more ‘regional’ projects, and the enabling legislation stipulates that 15 percent of revenues be allocated to local governments for transportation improvements. So, local decision makers who determined transportation needs will receive 100 percent of the revenues flowing from the referenda tax. But regions have to vote for the investment. Those regions that approve the referendum can use the money for their own local and regional improvements. Those that turn down the opportunity will miss out on the countless dollars that could be put to work on their behalf. “We know that every $1 billion we spend on transportation improvements supports 28,000 jobs and generates more than $2.5 billion in economic activity throughout the state,” says Heath Garrett, with Connect Georgia, the advocacy campaign of the Georgia Transportation Alliance. These are local projects, selected by local citizens that will bring local jobs. That makes it a smart investment.” Authors Note: John D. Edwards is an
Honorary member and a Past President of the Institute of Transportation Engineers, a 20,000 member organization of professional transportation engineers and transportation planners. This article is the product of several persons: Cindy Miller at Atlanta Communications, www.cindymilleratl.com and Todd Long at the GDOT, firstname.lastname@example.org. v
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Where We Go From Here? Surveys of the Regional Transportation Districts by the author indicate that there is little knowledge by the general public of the TIA or the benefits of the proposed tax in providing improved mobility and economic impacts. We, as an engineering society, need to become involved in an education and promotions program to make the general public aware of the benefits of the passage of the 2010 TIA referendum The public’s involvement statewide is what makes this project different than many previous transportation projects. KnowlNovember | December 2011
Round and Round We Go... By Thomas & Hutton Inc.
The Georgia Contractor
“I guess what we do is just drive around this circle here, should be the second left exit, there}s the hotel—Hey! Look kids! There’s Big Ben and there’s Parliament! I can’t seem to get over to the left honey, I’ll try again next time... sorry, we’ll get out of this jam in a minute.” Clark Griswold sets the tone for America’s perception of the roundabout by driving in the same circle for hours as the family falls asleep in National Lampoon’s European Vacation. Fortunately, the modern roundabout is much better than what is portrayed in the movie. A modern roundabout is helpful and safer than the traditional intersection to which we are accustomed. A roundabout controls traffic, keeps it flowing, and makes us safer by reducing traffic speed and the likelihood of T-bone or head-on collisions. According to the Insurance Institute for Highway Safety, roundabouts reduce all types of collisions by 30 percent, reduce injury by 76 percent, and reduce fatal and incapacitating accidents by 89 percent. Pedestrians are 50 percent less likely to be struck at a roundabout crosswalk than a traditional signalized intersection. A typical intersection has 20 to 30 critical points where vehicles could collide, a roundabout has eight. Don’t mistake a roundabout for a traffic circle. The differences are in the design as roundabouts require traffic entering the circle to yield to traffic that is already moving inside. Many traffic circles do not follow this rule. Roundabouts are smaller than traffic circles. The smaller size makes them safer, slower, and more efficient. Roundabouts are lauded for the aesthetic benefits they provide to an intersection. Roundabouts have proven to be a very effective way to improve traffic operations and enhance safety in difficult intersections. Mark Pickering, P.E., Vice President/Transportation Department Director for Thomas & Hutton stated, “Although relatively new to the United States, roundabouts have been used with great success abroad for quite a while. Unfortunately there are some examples of poorly functioning traffic circles in the U.S. that often create confusion about the functionality and benefits of November | December 2011 July | August 2011
roundabouts. Consequently, overcoming public apprehension about roundabouts is one of our greatest challenges. Education of the public about roundabouts probably requires as much attention from the project team as do the design details when planning and implementing a new roundabout. Our experience has been that when properly designed and constructed, roundabouts quickly become very popular with the motoring public.” “Georgia has 16 roundabouts and its Department of Transportation has identified about 100 more intersections where they would work,” says State Traffic Engineer Kathy Zahul. “People are generally
opposed to it until they get one, and then they say, “Oh, this is great,” she said. Doyle Kelley, Jr., PE with Thomas & Hutton states, “Thomas & Hutton has been designing roundabouts in our private developments for over 25 years. They were installed for their aesthetic value but ended up working well handling traffic at major entry points. FHWA and state DOT have rediscovered the roundabout in the last few years and are requiring its evaluation at potential signalized intersections. Roundabout rediscovery is providing the traveling public with more efficient, safer intersections.” The ACEC award winning Frederica13
roundabout system,” said Phillip S. Allen, St. Simons Island resident in a letter to the editor of The Brunswick News. “There’s definitely a learning curve for motorists,” says Jana Tidwell of AAA MidAtlantic. “It’s different than the alreadytrained red-light green-light scenario,” she says. “Once you experience it a few times, you become more comfortable.” The more Americans use roundabouts and experience the convenience and safety, the more widely accepted they will become. v
Demere Roundabout provides an excellent example of how well a roundabout can function. This was the first multi-lane roundabout in Glynn County, Georgia. The existing lighted intersection was the busiest on St. Simons Island. Frederica and Demere Roads function as primary arterial roadways on St. Simons Island and were often plagued by long traffic queues and travel delays where they intersected. Average daily traffic volumes through this intersection exceeded 25,000 vehicles per day with additional growth anticipated. “Many residents who were not familiar with the concept of the roundabout were opposed to the idea of changing the intersection. They were fearful that no one would know how to maneuver through it,” said Commissioner Uli Keller. “But those who were accustomed to travel and had been to other cities and countries that use roundabouts knew this would work.” The resulting facility improved operation of the intersection from a Level of Service F to Level of Service B, significantly reducing wait times for motorists. “After using roundabouts on St. Simons for a peri14
od of time, I would like to say that they are an excellent way to move—the old inefficient red light system seemed antiquated. We should replace more red lights with the
About Thomas & Hutton Founded in 1946, Thomas & Hutton provides quality services and project support to public and private clients. Technical competencies include civil, environmental, structural, and marine engineering; land surveying; land planning; landscape architecture; Geographic Information Systems (GIS), and construction administration. Thomas & Hutton has more than 150 employees in five office locations: Savannah and Brunswick, Georgia; Charleston and Myrtle Beach, South Carolina; and Wilmington, North Carolina. www.thomasandhutton.com www.facebook.com/THEngineers
Diagram Courtesy of Alaska Roundabouts
Conflict Points~ conventional intersection (left) v. modern roundabout (right) The Georgia Contractor
November | December 2011
What’s In It For Me? This common phrase exemplifies the reality of how people are primarily focused on the things that matter most to them. This is well depicted in the story of a young car salesman who enthusiastically shared with his 75-year-old female prospect the feature of how the new model SUV’s spare tire bin was designed to double as a beer cooler; perfect for tailgating! It is human nature to try to motivate another person from the same basis as one’s own perspective. However, being motivated is an internal effort and therefore arguably cannot be instilled in someone else; rather, it must be self-induced. A well-known athletic apparel company’s logo simplifies the act of “just doing it,” and this would be a whole different world if everyone just did. Unfortunately, when it comes to managing employees, motivation is not a one-size-fits-all concept. Different people are motivated for different reasons both personally and professionally. Particularly where employer/ employee interactions are concerned, understanding an associate’s individual motivating factor can enhance coaching opportunities and improve productivity while reducing turnover. Five common motivation factors are: Compensation “Show me the money!” This phrase is often heard at casinos around the world, but is also often the mindset of an employee that has a purely financial perspective on employment opportunities. This is especially common amongst people in commission-based positions. A professional that is motivated by money is less concerned about title, perks or even recogni16
tion. Instead, they operate from a ‘put it in my paycheck’ mentality. Their philosophy is that if they can’t cash it, it has no real value. This employee is usually self-motivated and as a result, often does not need a lot of coaxing to perform. They respond best to cash reward-based spiffs and bonuses which can be offered as additional incentives. Advancement A 26-year-old college graduate was convinced that he was making the right decision to turn down a position with a wellestablished corporation offering him a salary $15,000/year more than the start-up venture group that was also interested in him. His decision was based on his theory that it’s not just about the money. His desire to learn and grow in his new position with the start-up outweighed the income potential of the corporation. An employee that is motivated in this way genuinely thrives on the concept of moving up the corporate ladder. Offering constant reinforcement of advancement opportunities and highlighting examples of internal promotions are excellent ways to maintain a high level of motivation for this associate. Recognition From The Grammys to The Emmys and from horseracing to reality TV shows, our culture has trained us to focus on first place. Is it the sense of accomplishment or the bragging rights? Perhaps a little of both! Most contenders just aren’t as excited about the silver medal or being the runner-up. Sadly in fact, second place has been referred to as ‘the first loser.’ Despite society’s perspective, for some
people, simply receiving accolades for the effort of a job well done at any level is their motivating factor. Recognition builds self-esteem and confidence while setting a positive example for others. In the workplace, a photo on a wall, a designated parking spot or a shout out at the department meeting can mean more than a bonus to the employee motivated by recognition and usually doesn’t impact the company budget. Security The well-known definition of insanity is to do the same thing over and over and expect a different result. On the other hand, doing the same responsibilities over and over with a consistent result is considered job security. There’s an old joke about a 40-year-veteran accountant who would start every day by looking in his top righthand desk drawer. After his retirement, his associates were anxious to see just what it was that he peaked at daily. Upon looking, they found an old index card that read: “credits on the left...debits on the right.” In the case of the security seeking employee, minimal change implies safety and increases motivation. When assured often that their position is valuable and necessary for the long term vision of the company, it reinforces a comfort level and encourages maximum effort. Personal Satisfaction If the dream is big enough, the facts don’t count. An aspiration, a personal objective or a self-established goal is the greatest encouragement to the employee that is more motivated by personal satisfaction than money, advancement, recognition or security. It is common for this employee to The Georgia Contractor
be willing to commit to activities that are beyond the call of duty in an effort to move closer to fruition of their own desire and not for any ‘atta-boys’ from the boss. In coaching this team member, gain a respectful understanding of their personal agenda and offer support to focus on what is necessary to accomplish those individual objectives which will simultaneously attain professional goals. Identifying one’s own motivating factor can be the trigger to hitting a goal. Recognizing what motivates others will have a positive impact on the process of building good relationships both at the office and at home. v
About the Author Diane Ciotta is the founder of The Keynote Effect, where she presents a passionate message of accountability and encourages activities to conquer complacency. As a professional speaker with more than 20 years of sales training experience, she is also co-author of the book, “Pushing to the Front,” with Brian Tracy. For more information, please visit www.thekeynoteeffect.com, e-mail email@example.com or call 732-672-7942.
Identify Your Staff’s Motivating Factors
By Diane Ciotta
November | December 2011
Applying Risk Management to Project Performance By Sagar B. Khadka, PSP | Project Manager & Charles E. Bolyard Jr., PSP, CFCC | Chairman of the Board/Chief Executive Officer
hen it comes to the subject of risk management in construction, a vast array of literature (text books, best practice guides, standards of practice, etc.) and literary work (technical papers, white papers, case studies, etc.) have sprung up since the early 1970s that, when taken collectively, provide comprehensive material for a construction project team to draw upon and implement a sound risk management plan for its construction project. Particularly in the past decade, almost all major industry conferences (AACEI, ASCE, CMAA, PMI, etc.) have started including a track dedicated to the topic of risk management with the objective of promoting a discussion on benefits of risk management and techniques and tools currently available. And yet, the vast majority of construction projects do not have a formal risk management plan in place. The more prevalent approach is, instead of managing and mitigating risk in the project, that the construction project team’s time is spent in managing the issues, which is the realization of risk itself. Why is it that, despite the existence of a wealth of literature, technical know-how, techniques, and tools on risk management, a majority of construction project teams are not readily implementing risk management? This article discusses one key component in the overall process of risk management—the importance and application of qualitative risk management to project performance. While several variations to the risk management model exist in the industry, there are essentially five steps in implementing a risk management program for capital construction projects. As illustrated in the figure below, the steps required for both the quantitative risk analysis and qualitative risk management are common through Step 3, but a compre-
Risk Response Planning
Risk Monitoring & Control
DEFINE •Scope •Team •Strategy
IDENTIFY •Risk Event •Impact •Probability
ANALYSIS •Quantitative •Qualitative •Combination
ACTION PLAN •Mitigation Plan •Action Officer •Resolve by
Quantative •Monte Carlo •Others
Mitigation •Transfer •Mitigate •Accept •Avoid •Relax Rules •Contingency
Qualitative •Risk Register •Risk Matrix
hensive risk management plan would need to follow all the steps shown in the model. The literary works to date, whether they be text books, best practice guides, or technical papers in various trade journals, appear to have placed equal emphasis in all the steps outlined in the risk management model, and rightly so. The best benefits of risk management can be achieved when all bases are properly covered. However, having equal emphasis on all the steps in a typical project risk management model might have given the impression to the construction community that, in order for the project to have a successful risk management plan, it must perform quantitative risk analysis. The simple fact is that not all project teams have the required resources (technical know-how, funds, etc.) to perform a quantitative risk analysis in their project. The lack of resources in carrying out the quantitative risk analysis might have deterred the project team from implementing any kind of risk management plan at all. The question is: can a project team benefit from having a qualitative risk management plan in their project, even if it is not feasible for them to perform a quantita-
RE-ASSESS •Weekly •Monthly •Quarterly
tive risk analysis? The answer is ‘absolutely.’ The primary reason is that these two applications (quantitative risk analysis and qualitative risk management) serve two different and specific purposes, and complement each other. Implementation of one does not necessarily replace the need for the other. Similarly, the inability to implement one should not deter the project team from applying the other. Quantitative Risk Analysis Quantitative Risk Analysis is typically performed at the inception of a project to evaluate the viability of the project cost and/or time objectives . This is not to say that the quantitative risk analyses are not routinely performed in periodic intervals during the course of construction. Also, there may be instances in a project where circumstance might call for a quantitative risk analysis in the middle of a project, or at any point in the project life-cycle. Quantitative Risk Analysis is performed, after gathering all the known risk items and prioritizing them, to evaluate: What is the probability that the project will be within the budget? The Georgia Contractor
November | December 2011
This will help in arriving at the estimate for setting up the contingency funds. If setting up a contingency fund is not an option or if there is a limited budget available, de-scoping of project may be in order or several other options may be considered. What is the probability that the schedule deadlines will be met? This will help in setting realistic project deadlines. If the risk analysis shows that there is a very low probability of meeting the current deadline, the information gives the project team an opportunity to consider options in deciding a time contingency plan. Besides evaluating the contingency plan for time and cost overruns, decision makers may perform quantitative risk analysis to evaluate such scenarios as the viability of the project itself and reach for alternative programs.   . The steps required (risk planning, risk identification, and assessment) in terms of gathering the risk data for quantitative risk analysis are generally the same as those for the qualitative risk management. It is what is done with the risk data, how they are analyzed, and the specific purpose it [quantitative risk analysis] serves, that makes quantitative risk analysis different from qualitative risk management. Qualitative Risk Management and its Importance It would be ideal to have the quantitative risk analysis performed at the inception of a construction project for the benefits it provides as discussed in the preceding section. However, it may not be feasible to perform quantitative risk analysis for every construction project due to resource limitations, or the lack of the technical application expertise. What is feasible and within reach of most project teams is the application of qualitative risk management during construction. While quantitative risk analysis offers a snapshot of risks at a certain point in timeâ€” essentially at the time it is performedâ€”qualitative risk management goes beyond snapshots in time and deals with those project risk events until they are resolved. Qualitative risk management involves taking steps to identify every single foreseeable risk event (things that could go wrong) in the project, analyzing the potential 20
impact of each risk event on the project and prioritizing them based on the severity of impact, creating problem solving strategies to mitigate (recover from) impacts, and keeping an eye on each until the risk item is either averted, mitigated or resolved. As shown in Figure 1, the process of risk monitoring and control ensures continuity in its application throughout the project until it is complete. The key to risk management is that it is always forward looking, anticipating risk events well in advance of their occurrence in the project and taking steps to prevent them from happening, or at least reducing their impact by having a pre-prepared strategy or plan. This is in contrast to issue management, which is managing problems in the projects that have already surfaced. Put another way, the potential risks that could otherwise have either been eliminated or mitigated through the risk management plan at a lesser cost, when left unaddressed due to lack of a sound risk management plan in the project, usually turn into issues that now must be dealt with at full cost. How much savings can be expected from a sound risk management plan in the project? There is no way to provide an answer that can satisfy all because risks faced by each individual project are different. However, findings from case studies involving two large programs that employed a risk management plan are very
encouraging. Presented as the return on investment (ROI), which was defined as the ratio of savings to cost that indicates the value of performing risk management, both case studies reported ROI at over 20 to 1 . Even though the case study involved only two programs, the result is still very impressive. This article, within the context of project risk management, draws the distinction between quantitative risk analysis and qualitative risk management. While fully acknowledging the significance and importance of quantitative risk analysis, it is not always necessary to perform a quantitative risk analysis on a project in order to be able implement a qualitative risk management plan, which can provide immediate and far reaching value to project performance in terms of seeing the project through to completion on time and within budget. v References
1.Hulett, David T. Quantitative Risk Analysis
2.Hulett, David T. Project Cost Risk Analysis.
Hulett & Associates, 2002. http://www.projectrisk.com/index.html. 3.Hulett, David T. Schedule Risk Analysis Simplified. Project Risk Management Journal, 1996. http://www.projectrisk.com/index.html. 4.Singh, A., S. Shiramizu and K. Gautam. Bid Risk and Contingency Analysis. AACE International, Cost Engineering, Vol. 49, No. 12, 2007; 20-27. 5.Hall, E. M. Risk Management Return on Investment. Systems Engineering, Vol. 2, Issue 3. 1999, 177-180.
The Georgia Contractor
Housing Success Story: Columbia Residential CEO Noel Khalil talks about the successful public-private partnership of Columbia’s new Retreat at Edgewood community during a ceremony with HUD Secretary Shaun Donovan (center), Commissioner Mike Beatty, and Mayor Kasim Reed (right). Columbia Residential’s Retreat at Edgewood Community This week, a delegation of officials, including U.S. Department of Housing and Urban Development Secretary Shaun Donovan and City of Atlanta Mayor Kasim Reed, toured Columbia Residential’s new Retreat at Edgewood affordable rental townhome community. The tour highlighted the success of the Neighborhood Stabilization Program, which helped fund construction of the Retreat at Edgewood, one of the first major projects backed by federal stimulus dollars last year. Retreat at Edgewood was awarded $2.7 million by the city and state through the Neighborhood Stabilization Program to redevelop an area November | December 2011
that has suffered from foreclosures and abandonment. In his remarks, Secretary Donovan also discussed the administration’s new housing refinancing plan aimed at providing a lifeline to underwater borrowers and strengthening the U.S. housing market. “Secretary Donovan and Mayor Reed’s tour emphasizes the positive impacts a public-private partnership can make on an entire community,” said Jim Grauley, president of Columbia Residential. “The accolades deservingly go to the Zeist Foundation, which has dedicated 17 years to the Edgewood community.” Columbia Residential partnered with the Zeist Foundation to create the 100unit Retreat at Edgewood community. The Zeist Foundation and its partners
have taken a holistic approach to community revitalization in Edgewood, resulting in extensive community engagement and numerous improvement initiatives, uniting high quality housing, healthcare, and education. About Columbia Residential Established in 1991, Columbia Residential develops and manages high quality, affordable, and mixed-income multifamily housing communities. Columbia manages thirty-five (35) communities in Georgia, Texas, and Louisiana. It maintains an active development pipeline, creating award-winning developments through public-private partnerships. For more information, please visit www.columbiares.com. v 21
Chicago Pneumatic BRK 55 Hydraulic Breaker has Power and Flexibility A favorite with construction and rental companies, Chicago Pneumatic BRK 55 hydraulic breakers are the ideal choice for a broad range of road building and maintenance applications.
Delivering 1,450 blows per minute, the BRK 55 delivers dependable power and performance working on asphalt, concrete or frozen soil. Chicago Pneumatic BRK 55 hydraulic breakers feature a slim design, giving operators an effective line of sight to the working tool point, boosting productivity. Operators are able to get to work quickly because the BRK 55’s hoses are fitted with flat face HTMA quick release couplings for fast, easy connections in all work environments. The couplings are designed to fight the dust and dirt that can build up on work sites. The BRK 55 is well balanced and is without external side bolts or other protruding machine parts that can come into contact with the operator, further improving comfort and productivity. These units can be used with both eight gallons per minute or five gallons per minute PAC Power Packs. Compact and fuel-efficient, the low-maintenance and exhaust-free BRK 55 stands up to even the coldest temperatures. Chicago Pneumatic offers vibroreduced handles as an option on the BRK 55 hydraulic breaker. These handles provide a more ergonomic and comfortable grip, designed to reduce the reactive force experienced by the operator, and dramatically 22
reduces operator fatigue while also increasing overall productivity. Other optional accessories for the BRK 55 include oil-flow dividers, which reduce flow and pressure, allowing operators to run tools from hydraulic-powered carriers. The addition of one or two 23foot extension hoses allows operators to extend working ranges up to 69 feet without significant drops in pressure. For more information, contact Eudes Defoe +1 (216) 571-7615, firstname.lastname@example.org or visit www.cp.com. v Technical College System of Georgia Hires Parrish Construction Group for $4 Million Renovation to Atlanta Technical College Campus HVAC Renovation Project Encompasses Three Classroom and Office Buildings The Technical College System of Georgia has partnered with Parrish Construction Group for renovations to buildings on the Atlanta Technical College campus. Parrish Construction Group of Perry and Alpharetta, Georgia, specializes in constructing academic facilities throughout Georgia, and the ATC project was the perfect fit for the 16-year-old firm. TCSG hired the design build team Parrish Construction and NBP Engineers to renovate the existing HVAC systems in three buildings that had problems with temperature and humidity control. The existing facilities encompass approximately 320,000 square feet of instructional, classroom, vocational lab, and office space. The facilities are served by varying existing HVAC systems that have been altered over time to respond to the changing needs of the educational programs. “We’re excited to be working with
TCSG and ATC,” said Parrish Construction Group President and Founder Dave Cyr. “ATC is a great institution and we’re happy to help them upgrade their facilities to meet the growing needs of incoming students. We know that on campuses especially, it is critical to renovate facilities while classes continue to operate safely and we’re glad to take that responsibility.” Parrish Construction Group will provide a reliable HVAC system designed and constructed to operate under a wide range of weather, occupancy, and building use conditions to continually provide the optimum learning and teaching environment for students and faculty. “This project comes at a great time, considering the job market crisis in America.” Cyr said. “This HVAC renovation project is in the range of $4 million with soft costs to be determined. Parrish Construction Group is happy to keep our employees working, even through this tough economy.” v Magnalight.com Introduces Rechargeable LED Light Stick The Magnalight WL-LED-12-M rechargeable trouble light is the newest in versatile and durable LED lighting from Magnalight.com. This portable LED light offers high light output combined with an integrated magnetic mounting system to produce a weatherproof, portable industrial grade LED task light. Designed for use anywhere, the WLLED-12-M LED light stick from Larson Electronics’ Magnalight combines the convenience of rechargeable portability with the versatility of magnetic mounting. Containing 60 LEDs powered by an integral Ni/Hm battery, this LED light stick produces enough light to cover an area approximately 25 feet long by 20 feet wide, and will run for over four hours on a single charge. An impact, shock, and vibration resistant housing provides durable operation and makes this light suitable for indoor or outdoor use. The long life LEDs have a 100,000 hour lifetime rating and will provide years of reliable operation. This LED light has two built in 20-lbs. grip magnets that allow the unit to be attached to any ferThe Georgia Contractor
rous metallic surface. This feature is ideal for automotive and work applications where the user needs effective illumination that leaves their hands free. This unit also has predrilled through holes to allow mounting the unit with screws for permanent or semi-permanent mounting such as would be found in machine light applications. Included with this unit is an AC/DC charging unit for recharging from common 120 VAC outlets and a cigarette plug adapter for charging from vehicles and equipment. Fully wireless, portable, and ruggedly constructed, the WL-LED-12-M LED light stick is an ideal lighting solution for portable industrial applications. “This is a versatile, rechargeable LED task light with magnetic base that is ideal for small area work spaces,” said Rob Bresnahan with Larson Electronics’ Magnalight.com. “This LED light is basically a magnetic mount LED trouble light. Larson Electronics’ Magnalight.com carries a full inventory of LED lighting for heavy duty, commercial, and industrial applications, including explosion proof LED lights, cart mounted LED lighting, and battery operated portable LED towers. Please view Magnalight’s’ full line of lighting equipment by visiting Magnalight.com. Magnalight can be contacted by calling 1800-369-6671 or 1-214-616-6180 for international inquiries. v
November | December 2011
McCarthy Secures Win With Kaiser Permanente New medical center build to extend care and services to members McCarthy Building Companies Inc.’s Southeast Division is pleased to announce a new $42 million project win for Kaiser Permanente’s Glenlake Comprehensive Medical Center (CMC). Slated to start the second quarter of 2012, the targeted LEED Silver CMC adds approximately 100,000-square-feet spread out over four floors to the existing facility. The project also includes 40,000-squarefeet of renovation complete with a 600 car parking garage. With these improvements, the facility will be equipped to provide around-the-clock medical care and services to Kaiser members. “This project win speaks to our commitment of building and sustaining partnerships with outstanding companies,” said Southeast Division President Kevin Kuntz. “We are honored to have been chosen for the project and look forward to working alongside the Kaiser Permanente team on their latest pursuit.” McCarthy Building Companies Inc. (www.mccarthy.com) is the nation’s second largest healthcare construction manager, sixth largest education construction manager, and tenth largest domestic general con-
tractor (Engineering News-Record, May 2011). With nearly 150 years of experience, McCarthy is also one of the nation’s oldest, privately held construction firms. Committed to the construction of high performance buildings, McCarthy provides general contracting, construction management, program management, and design/build services for healthcare, educational, parking structure, entertainment, retail, laboratory, biotechnical, microelectronic, and industrial facilities; office buildings; tenant interiors; ports; bridges and highways. In addition to Atlanta, McCarthy has offices in Newport Beach, Sacramento, San Francisco, San Diego, Phoenix, Las Vegas, Dallas, Houston, and St. Louis. McCarthy is 100 percent employee owned. v IEC Georgia Receives $1,000 Grant from the IEC Foundation! The IEC Georgia chapter was awarded a generous grant of $1,000 from the IEC Foundation. The IEC Foundation is the charitable arm of IEC dedicated to creating educational opportunities and guiding youth on the path to successful careers in the electrical industry. The IEC Foundation organized a Special Grant competition that required proposals presenting the positive impact the awarded funds would contribute to the presenting chapter’s Apprentice and Training program. Chapters were allowed to request up to $1,000 in funding to upgrade the apprentice training labs and classrooms for items not ordinarily covered in IEC Foundation equipment and cash grants. IEC Georgia will benefit from this grant by improving classroom performance with a new Classroom Performance System (CPS). The CPS, referred to by instructors as, ‘The Clickers’ is automated and allows for paper or a screen test. Earmarked for the Columbus Program, the system is able to automatically upload student grades, allowing the instructor more time to focus on teaching instead of grading. With the new equipment provided by the IEC Foundation Special Grant, IEC Georgia chapters’ instructors and students will reap the benefits of more attention and time available to improve the quality of 23
information provided and to better master their developing skills! IEC Atlanta Receives Equipment Grants awarded from the IEC Foundation! The IEC Atlanta chapter will benefit from a $40,528 equipment grant from the IEC Foundation, the charitable arm of IEC. IEC Foundation provided nearly $300k in equipment grants to the IEC Chapter Training Programs in 2011. The grants are made possible by several generous partners such as, Schneider Electronic/ Square D, Eaton Corporation, Hubbell/ RACO, Ideal Industries, and Southwire. IEC Atlanta will put the award to great use. The grant will allow apprentices to have hands on training in addition to the high level classroom training. The result is a quality workforce and a quality life! IEC announces a new Electrical Apprenticeship Program in Columbus, Georgia Independent Electrical Contractors of Georgia is announcing its new electrical apprenticeship program starting in Columbus, Georgia, January 2012. IEC will provide overight of this program and is thrilled to supply the Columbus area with quality electrical training. This program will be held at the Turner Center at Columbus State University, and will currently serve 17 electrical area contractors. Classes will be held one to two nights per week with Chief Electrical Inspector Allen Posey as the instructor. IEC National curriculum will be provided in addition to hands on training. IEC’s electrical apprenticeship program has been operating successfully over 35 years in the Columbus area. Any electrical contractors in the greater Columbus area interested in enrolling employees should contact IEC Georgia soon to secure your space. IEC Foundation continues to be a large supporter of IEC Atlanta, and its members. IEC Atlanta greatly appreciates the support that the Foundation provides. For more information about the IEC Foundation, or to make a donation, go to www.iecfoundation.org For additional information, contact 24
Niel Dawson, Executive Director at (770) 242-9277. IEC is a trade association for merit shop electrical contractors. IEC offers a wide array of training programs for apprentices and experienced electricians, personnel referral including loan/borrow programs, and provides a broad range of informational resources for electrical contractors in Atlanta and Georgia. v Cooper Lighting Introduces the Next Generation LED LightBAR™ System New system provides unmatched optical performance in both lumen output and eﬃciency. Cooper Lighting has announced it has upgraded its outdoor LED LightBAR™ technology. Internally developed at Cooper Lighting’s accredited state-of-the-art LED Innovation Center and integrated in multiple product lines, the new system’s unmatched optical performance delivers improved lumen output and efficiency, while continuing to offer up to 75 percent in energy savings over traditional High Intensity Discharge (H.I.D.) outdoor lighting sources. Designed to meet today’s demanding energy and environmental needs, Cooper Lighting’s LightBAR™ technology features the company’s patented AccuLED Optics™, which sets the industry benchmark for reliable photometric performance, scalability, and energy efficiency. The system’s unique application-specific design allows lumen and energy output to be customized to fulfill the exact needs of the outdoor space— eliminating wasted energy and obtrusive spill light. Designed for both new construction applications or to replace inefficient luminaires, the next generation LightBAR technology is available in two versions (seven LEDs and 21 LEDs), three standard color options (3000K, 4000K and 6000K correlated color temperatures (CCT)), and 13 different optical distributions, providing versatility for every outdoor need, including street lighting, area/site, floodlighting, wall mount, parking garage, canopy, and pathway solutions. The updated LightBAR technology offers an increase in efficiency in all optical distributions without degrading optical per-
formance, lumen depreciation or lumens per watt (lm/W). Boasting more task lumens per watt, the high efficiency 21 LED LightBAR optical fixtures deliver up to 100 lm/W or 2400 lumens per LightBAR, which outperforms the original 21 LED LightBAR fixture (1800 lumens) by 600 lumens, (using the same number of AccuLED Optics), while the Seven LED LightBAR optical choice (1900 lumens) also increases its lumen output over the original 21 LED LightBAR. The efficiency and performance improvement roadmaps of LED technology guarantee the availability of improved lm/W packages in the future. To address future retrofits of higher performing packages, Cooper’s unique LightBAR design is
backwards compatible or future-proof both electrically and thermally, meaning there are no changes to the driver or the heat sink, making future LED upgrade replacements to its fixtures simple. Cooper Lighting also expanded the color options to include a 3000K and 6000K CCT as standard in addition to the preferred color choice, warm white color of 4000K CCT. While typical LED outdoor solutions are standardized on a cold blue color temperature (6000-6500K CCT), Cooper Lighting LightBAR-equipped fixtures, by comparison, provide specifiers and end-users a desired color choice. Cooper Lighting’s LightBAR technology provides energy savings between 30-75 percent over standard H.I.D. systems while also providing a 50,000+ hour rated life–six times longer than the traditional metal halide sources found in most outdoor commercial applications. The Georgia Contractor
The LightBAR technology, integrated into the industry’s leading portfolio of outdoor product lines represented across four of Cooper Lighting’s company brands (Invue, McGraw-Edison, Lumark, and Streetworks) offers lighting solutions that qualify for many local utility rebates. Cooper Lighting has made a significant investment in people, resources and technology to ensure the company provides first-class solutions to its customers’ lighting challenges. The company offers a range of indoor and outdoor LED lighting products and controls, all of which are specifically designed to maximize energy and cost savings. For additional information on Cooper’s LED product offering, check our Web site. Cooper Lighting, a subsidiary of Cooper Industries, is the leading provider of world-class lighting fixtures and controls to commercial, industrial, retail, institutional, residential and utility markets. As lighting technologies have advanced over the years, Cooper Lighting has been at the forefront of the industry in helping businesses and communities leverage the latest technologies to improve efficiency, reduce costs, and enrich the quality of the environment. For more information, visit www.cooperlighting.com. v
November | December 2011
Courseault Commercial, Inc. Creates New Partnership with McCarthy Building Companies Inc. Companies connect through 8(a) mentor/protégé program Courseault Commercial Inc. (CCI), a minority-owned commercial construction company, is pleased to announce a new partnership with the Southeast Division of McCarthy Building Companies Inc. This 8(a) mentor/protégé relationship, formally approved by the SBA in 2011, provides CCI with developmental assistance in numerous areas of business, including project and operational management, accounting practices, and business development. “At CCI, we understand the value of long-term relationships,” said Courseault Commercial Inc. Founder LeRoy Courseault. “Our pairing with McCarthy reflects our desire to learn from one of the best U.S. based construction companies to help our business grow.” The overall mentor/protégé goal is to provide training and tools to CCI, a Small Business Enterprise (SBE) and Minority Business Enterprise (MBE), to raise their construction management business to the next level. This latest connection is reflective of McCarthy’s ongoing pursuits to part-
ner with outstanding SBEs and MBEs across the country. “This new collaboration with CCI marks an exciting step for our office,” said Southeast Division President Kevin Kuntz. “It is our relationships, like the one with CCI, that continually foster our focus on building excellence and commitment to seeking out talented partners.” Courseault Commercial Inc. (CCI) is a construction company specializing in commercial buildings and spaces of all types. Their clientele includes large and small corporations, financial institutions, governmental facilities, hospitality and educational institutions, with projects ranging from new construction and renovation to project management and real estate brokerage services. McCarthy Building Companies Inc. (www.mccarthy.com) is the nation’s second largest healthcare construction manager, sixth largest higher education builder, and tenth largest domestic general contractor (Engineering News-Record, May 2011). With nearly 150 years of experience, McCarthy is also one of the nation’s oldest, privately held construction firms. Committed to the construction of high performance buildings, McCarthy provides general contracting, and construction management program. v
New Considerations for Joint Venture Agreements By D. Michael Williams | Rutherford & Christie LLP
y now, many in the construction industry are probably aware of the three percent withholding mandate on government contracts, which becomes effective January 1, 2012. While Section 511 of the Tax Increase Prevention and Reconciliation Act (TIPRA) was enacted in 2005, contractors who perform work for federal, state or local governments should begin considering and preparing for the overall effect that the withholding mandate will have, since the effective date now looms at the end of this year. If you are unfamiliar with the withholding requirement, most trade organizations for industries that regularly provide goods and services to governmental agencies have detailed information about the withholding mandate available on their Web sites. Generally, the law requires that federal, state, and local governments with expenditures of more than $100 million withhold as federal taxes three percent of payments for products and services worth more than $10,000. There are lobbying efforts underway to attempt to have the withholding requirement repealed, but so far Congress has yet to pass any legislation that removes Section 511 from TIPRA. A recent report by the Treasury Inspector General for Tax Administration seems to have made the efforts to repeal the withholding mandate more difficult. The report found that more than ten percent of contractors performing work for the Internal Revenue Service had delinquent federal tax accounts totaling $10.6 million. Trade organizations for many of the industries affected by TIPRA have debated the effects of the withholding mandate. Opponents of the TIPRA withholding requirement have provided numerous examples of how TIPRA impacts the various industries that regularly conduct business with governmental agencies. In the
construction industry, the TIPRA withholding requirement would impact the creation of project specific entities such as Scorporations, partnerships or joint ventures. The agreements that create these entities need to anticipate the future effects of the TIPRA. For example, a governmental agency is required to withhold $600,000 in payments on a $20 million construction project. Because the payment withheld is applied to the potential tax liability of the entity, the agreement creating and governing the project specific entity will need to address how to account for the tax payment among its members. In addition, because the entity was created for a specific project, it usually would not have large cash reserves. Withholding a $600,000 payment may leave the partnership or joint venture cash strapped and unable to complete the project without a cash infusion. Any agreement that creates and governs a project specific entity should address how future capital needs will be handled. While the TIPRA withholding requirement does not apply to contracts with private entities, any joint venture or other enti-
ty created for a specific construction project creates a very complex set of problems that need to be addressed. Any agreement that creates a project specific entity should, at the very least, address the detailed scope of work for each party, a specific procedure for managing the entity, the duration of the relationship, a method by which profits (or losses) will be divided, how future capital needs will be met, and how disputes will be resolved. In addition, joining forces and finances with another company also may require disclosure of confidential or proprietary information, including a companyâ€™s key employees. In such cases, the joint venture or similar agreement should contain a confidentiality provision and prohibit hiring away key employees at the conclusion of the project. Whether addressing problems created by TIPRA or those that are likely to occur on any project, anticipating potential problems and adopting a mechanism to resolve them proactively can go a long way toward ensuring the success of a joint venture. v
About the Author D. Michael Williams is of counsel with the law firm of Rutherford & Christie LLP, a certified Womenâ€™s Business Enterprise with offices in Atlanta and New York(www.rutherfordchristie.com). His trial and appellate practice focuses on construction litigation, commercial litigation, government liability, and zoning and land use litigation. Mr. Williams has served as trial counsel in a variety of construction litigation matters involving contract disputes and claims related to construction defects and material failures. He can be reached at (404) 522-6888 or email@example.com.
The Georgia Contractor
Georgia Contractors Business Growth in the Clouds By Mark Reino
onstruction within the state of Georgia often has contractors and regional construction companies searching for ways to seek new growth, preserve revenue and profits, and cut operational costs. Finding different sources for materials will only get you so far, and staff downsizing can no longer lead to growth. But a new way of looking at marketing might be able to satisfy all of the above. When companies large and small want to reach customers and prospects, they rely on e-mail marketing primarily because it’s fast and affordable. Today, Georgia construction businesses and contractors are using e-mail marketing campaigns tied in to landing pages that are custom designed and programmed for easy distribution and powerful reporting. What’s more, savvy construction companies are now integrating social media marketing vehicles into their email campaigns and leveraging powerful and geo-targeted applications like Twitter and Facebook. What do all of these marketing tactics have in common? The cloud is now the preferred platform for distribution, measurement, and marketing campaign scalability. Clearly, it’s still ultra-important for companies and organizations to have a web presence that publishes the right content and photography, and navigates the user through the buying process simply. Similarly, a Web site that allows visitors or homeowners to publish their own opinions in the form of a Blog or User Review will cultivate a community of followers and encourage viral distribution (read: online word of mouth marketing). And today, adding video to your Web site is quite simply the most engaging way to educate, inform, and empower your audiences on your brand and influence their buying behaviors. But why stop there? Georgia construction companies and contractors that have made investments in Web site and e-mail
November | December 2011
marketing now have the opportunity to close the marketing loop and truly promote their products and services leveraging cloud technology. Doing so will provide them an opportunity to significantly grow their business, strengthen the relationships they have with their customers, and ultimately lower their operating costs. Cloud marketing is a business development strategy that allows a construction business owner to shift investments in IT and marketing communications from inhouse to off-premises environments. This approach saves time and money, and gives the business owner all the control they need to make informed, cost-conscious decisions. It also allows small-to-mid-sized companies to focus on their core business, rather than their IT or their Web site.
With cloud-based tools, business owners can send the e-mail campaign, track who responds, scale the capacity of their landing pages on-demand, and measure
The cloud changes every aspect of this process from distribution to measurement. Today, executing marketing campaigns that rely on cloud technologies allow construction businesses the ability to build an e-mail marketing campaign in less time and at a lower cost. Instead of having to create the campaign from scratch, manually pull the list and import the data, design the e-mail and decide which versions of the e-mail go to which parts of the list, it’s all processed dynamically based on the criteria loaded into the automation tools being used. With cloud-based tools, business owners can send the e-mail campaign, track who responds, scale the capacity of their landing pages on-demand, and measure real-time and post campaign performance without the need for costly creative, management, and IT experts. Furthermore, business owners and contractors can now do even more with their marketing campaigns. Determining what days are best for the delivery of your email campaigns (and even what times of day) are now standard reporting metrics.
real-time and post campaign performance without the need for costly creative, management, and
“Gort! Klaatu Borada nikto.”
IT experts. Then & Now Five years ago, most racquet construction outfits, as well as companies in just about any B2C or B2B industry were leveraging email marketing to reach customers, members and prospects. But in order to carry out an e-mail marketing campaign it was very labor intensive, and there weren’t a lot of analytics outside of the limited versions offered by the particular platform being used. Business owners needed to figure who was going to create the campaign, distribute the e-mail, store the campaign data, figure how to prepare for increased landing page and Web site traffic, and how to accurately measure bottom-line performance.
A4 INC. (770) 521 8877 USE A COMPANY YOU CAN TRUST WITH YOUR TRANSLATION PROJECT, because a little mistake in another language can have unpleasant results.
Also, discovering what types of devices (email clients, cell phones, tablets) your audiences use are analytics that will allow you to adjust your creative formats in future campaigns. Similarly, identifying exactly who is (and who is not) clicking will allow you to prioritize and segment your distribution lists accordingly. The true payoff, however, is that cloud marketing technology enables all of this activity in standard browser-based environments, and does so on off-premises servers—eliminating the need for dedicated infrastructure and specialized in-house staff. Bottom line—you can do all of this and still focus on construction projects, not managing more people. Drastically Lower Costs The cloud also drastically changes the way Georgia construction companies pay for their Web site hosting activities, services and marketing campaigns. In a sense, the cloud allows companies to consume these services much like they consume electricity. Instead of having traditional fixed costs associated with Web site hosting, compa-
nies can now scale their hosting services up or down depending on various times of the year when more activity is needed or not needed. Because everything takes place in the cloud, they pay their cloud service provider accordingly, depending on whether it’s a month where more marketing activity has taken place. In much the same way a homeowner pays a higher utility cost to heat their home during the winter, a business owner would only pay a higher cost for e-mail and Web site hosting services in a given day or month when there was
a special promotion taking place, or the need for more bandwidth to handle increased web traffic during the peak build season or trade show. On the surface, cloud marketing may sound like another buzz-term, but considering the power cloud marketing offers, combined with what e-mail, social media, and Web site administration can do for a business, it’s a must-have in today’s world of limited budget, limited staff, and expense avoidance.v
About the Author Mark Reino is the CEO of Merit Mile Communications, a forward-thinking, technology-savvy marketing communications agency. The firm takes on business planning and consulting assignments, as well as creative services engagements such as branding and custom web development—all designed to fast track the business growth of its client partners. For more information visit www.MeritMile.com.
The Georgia Contractor
November | December 2011
Fall Protection Anchors ~ Exterior Wall Access Observations & Lessons from the School of Experience By ECS Corporate Services LLC.
ave you ever walked down the street, looked up, and wondered if that window washer was crazy? If conducted safely and within the guidelines of ANSI, IWCA, and OSHA, it is actually a relatively safe working environment. Window washing is regulated by ANSI/IWCA I-14.1-2001 (International Window Cleaning Association) and enforced by OSHA. is article will cover the basics of the requirements. Every year fall protection ranks high on the OSHA list of citations, both in number and in dollars of fines. In 2009, OSHA reported the number one citation was “e Duty to Have Fall Protection”, whereby 7,461 citations and $10,196,435 in fines were levied. IWCA I-14.1 Section 4.1.1 states, “All buildings where window cleaning is performed that employ suspended equipment shall be equipped with roof anchorages or other approved devices which will provide for the safe use of the equipment in conformance with the provisions of this standard.” e following is a summary of the requirements for the anchors, load testing, and use plans: e proper number and location of certified anchors is critical. Each point of descent (location of rappel at building parapet wall) must have two independent anchors within 15 degrees perpendicular to the wall being accessed. Also, anchors near exterior corners of the building need to be closer to the elevation being accessed than the adjacent wall of the corner. Each anchor needs to be rated for four times the rated load or 5,000 pounds, which ever is greater. Two independent anchors need to be utilized per worker accessing the façade. Each anchor needs to be certified for use by a Professional Engineer prior to use, every ten years, in conjunction with a roof replacement, and observed annually by 30
a competent person. Use plans for this type of activity must be developed by the owner and the contractor. e owner’s plan specifies the equipment that shall be provided and the procedure for its use. e contractor’s plan specifies how existing (building owned) equipment shall be utilized and details any additional equipment necessary to provide a compliant system. Proper knowledge, implementation, and maintenance of a fall protection system can allow for safe access, public safety, and clean windows. We hope this “Lessons Learned” on fall protection and the ANSI/IWCA standard helps you understand this complicated life safety issue. Should you have any questions or comments regarding this topic, or with any other issued related to vertical access, please feel free to contact us.
Respectfully, ECS CORPORATE SERVICES, LLC Respectfully, ECS Corporate Services LLC ©2011 ECS Corporate Services LLC All Rights Reserved
The Georgia Contractor
November | December 2011