Utility & Transportation Contractor Magazine June 2013 by UTCA

June Cover_Layout 1 6/6/13 10:16 AM Page 1

Robert A. Briant, Sr. 1937-2013

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Utility and Transportation Contractor, JUNE 2013

President’s Message Robert A. Briant, Sr. was an exceptional person who developed a great association with, and in the interest of, the contractor. All of Bob’s achievements and accomplishments are important but he knew they were not the real things that mattered most in life. He knew what really mattered is how you value yourself, your family and your friends and in turn, the role model you will become to all you meet. Bob served us well, both as the CEO of the UTCA and as a mentor who led by example which, most importantly taught us the true value of mentoring. Bob left us in great hands with Bobby who was recently named Chairman of the Clean Water Construction Coalition and Trustee of the New Jersey Environmental Infrastructure Trust. Bobby’s leadership will help guide this association to new heights as his father knew he could. At our Northern and Southern Membership Meetings we were given great news from the Environmental infrastructure Trust Executive Director David Zimmer. The NJEIT is planning to fund the bidding of 166 projects this next fiscal year valued at $ 781 million. Additionally, the fund will be working with the Hurricane Sandy relief projects not traditionally funded through the EPA. Our association needs to continuously monitor the NJEIT funding and follow the money so it gets on the street in the next fiscal year. As an association we need to continue to work with Mr. Zimmer to support his mission to get the most funding in our state for the clean water and drinking water improvements. Traffic control on our state roads has become a major challenge. What our contractors do day and night across the state with trained crews and certified coordinators is channel traffic so we can improve the highways, bridges, install guiderail and sign structures in the best interest of the traveling public. The contractor community does a great job to the best of their ability but we need help from the state. We need more State troopers to support the contractors when putting out and picking up lane(s). The safety of our employees and the traveling public cannot become a line item in the budget that gets scratched year to year. Work zones are unfamiliar territory to drivers. This creates a great need for law enforcement to ensure safe and efficient erection of traffic channeling devices in ensuring safe and efficient passage through our sites. Conversely, on our local roads we need more control over the abuse of the police protection required by certain municipalities. This association was very successful in amending the Local Public Contract Law requiring a line item allowance for uniformed law enforcement officers, but we now need to control the cost of and the need for these officers. Local police is the best form of traffic control in municipalities for the traveling public, pedestrians, and contractor if it is not abused. We need to rein in the abusive cost which is compounded by the administrative fees from the 2

municipalities, as well as the demand for escrows. The cost incurred by the contracting community which is financially supported through the local public funding or utility is just another burden on the taxpayer or rate payer respectively. This additional cost is driving the price of work up thereby reducing the amount of infrastructure improvements that create an opportunity for employment and an improvement in quality of life. We need to put legislation in place that provides for collaborative efforts with the municipalities in deciding the most prudent way of monitoring safe work zones without incurring retaliation from the uniformed law enforcement officers. As the State fiscal year comes to a close we see the NJDOT pumping out work as was the plan that was presented to us last year when we reviewed the capital program with the DOT representatives. (Q1-6 projects, Q2-12 projects, Q3-6 Projects, Q422 projects). Our association needs to work with the DOT and try to regulate the flow of work that comes out of the department so we are not innundated with the challenge of preparing bids for multiple projects in a short period of time. Realizing that permitting and right of way issues deter the department in the release of these jobs, our association will coordinate with the department in better managing the release of new projects in the fiscal year 2014. Evan Piscitelli continues to push our legislative initiatives, and, as I have learned, this is like pushing a flat sided rock up a hill. We are tirelessly working on passing the State Transportation Infrastructure Bank so our state is statutorily prepared to receive federal funding earmarked for state infrastructure banks. We continue to push our other initiatives which include precluding the submission of financial statements under Local Public Contract Law as a required bid document, amending dispute resolution under LPCL, and equitable adjustment. We also continue to work with legislators in supporting apprenticeship programs that do not create unfair and noncompetitive bidding paradigms. As always this association will work in the best interest of the membership. We encourage your feedback on these issues or any others as your concerns are our primary points of focus, and loaded with this information and your opinions we will tackle the issues that will fortify our industry.

Best regards,

Joseph T. Walsh Utility and Transportation Contractor, JUNE 2013

JUNE 2013 Volume XXXVIII, Number 3

Contents Features 4

Published Bimonthly During 2013

11 Office Address: 1670 Route 34 North Farmingdale, NJ 07727 Mailing Address: PO Box 728 Allenwood, NJ 08720 (732) 292-4300 FAX: (732) 292-4310 www.utcanj.org Publisher: Robert A. Briant, Jr. Editor: Michael DeVito Editorial Contributors: Michael DeVito Evan Piscitelli Dan Neville

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UTCA Pays Tribute To Bob Briant, Sr. A Legacy Of Excellence And Success Robert A. Briant, Sr.’s Legacy Strategic Business Planning Is The Key Tool Of The Trade UTCA Members Enjoy Turkey/Greece Executive Seminar Robert A. Briant Sr. Memorial Scholarship Fund Insuring Joint Ventures It’s Only “Half Time” For Federal Transportation Investment UTCA Conducts First Sporting Clay Shooting Event Road & Transportation Market Outlook

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Advertising Manager: Helene Nasdeo Photographer: Michael DeVito Cover Photo: Image Up Production/Graphics: Lauren Hagan Helene Nasdeo

Departments 2 23 34 55 80

President’s Message Legislative News Accounting Corner Labor Relations Safety Perspective

Circulation: Helene Nasdeo Printed By: American Plus Printers Affiliations: ARTBA Clean Water Construction Coalition Water Infrastructure Network UTILITY AND TRANSPORTATION CONTRACTOR (ISSN 0192-4843) is published six times a year by the Utility and Transportation Contractors Association of New Jersey, 1670 Highway 34 North, Farmingdale, NJ 07727. Periodical postage paid at Farmingdale, NJ and additional mailing offices. POSTMASTER: Send address changes to UTILITY AND TRANSPORTATION CONTRACTOR, PO Box 728, Allenwood, NJ 08720.

Cover Pictured on the cover is the late Bob Briant, Sr.

Utility and Transportation Contractor, JUNE 2013

UTCA PAYS TRIBUTE TO ROBERT A. BRIANT, SR. Association Mourns The Loss Of Industry Titan On February 27, 2013 the Utility and Transportation Contractors Association (UTCA) and the entire construction industry lost one of the industry’s giants. Bob Briant, Sr. served the UTCA for forty years until his sad passing. This issue of the Utility and Transportation Contractor serves as a tribute to Bob’s tireless efforts and contributions to the association and construction industry during his long and successful tenure. Robert Alan Briant was born in 1937 to Dudley and Mae Briant. After growing up in South Plainfield, NJ, he attended North Plainfield High School where he became an AllAmerican basketball and baseball player, graduating from the school in 1955. It was his skill as a baseball player that led him to a tryout with the Brooklyn Dodgers. Bob Briant received a basketball scholarship from Seattle University where he enrolled in the fall of 1955. One of his teammates was Elgin Baylor who went on to a storied Hall of Fame career in the NBA. Due to asthma and allergies which were exacerbated by the weather conditions in Seattle, Bob left the University after one year.

During the next summer the eighteen year old Briant was a member of the Lakeland Pilots, which served as a minor league affiliate of the Detroit Tigers. Following the season, Bob enrolled in Paterson State College where he earned a bachelor’s degree in education. He then earned a master’s degree in behavioral sciences.

Bob and his wife, Carole are pictured at a UTCA function.

With his career now on course, Bob Briant’s life would change forever in 1958 when he met a lovely young woman named Carole Semenza. Bob and Carole were married in January of 1959 and, in October, they welcomed their first child: Robert A. Briant, Jr. Another son, Michael, was born in February 1961 and the family was blessed with the addition of a daughter, Joanne, in March 1964.

Left to right are Bob, Ed Cruz and the late Congressman Jim Howard.

Bob during his stint as a minor league baseball player. 4

Bob Briant utilized his educational background as an elementary school teacher in Newark, NJ during the 1960’s. His teaching career then led him to the Jersey Shore area and Point Pleasant Boro High School, where he taught American Government and coached basketball until 1969. After leaving Point Pleasant, Bob accepted a position with the New Jersey Department of Education and he also taught at the college level on a part-time basis. Utility and Transportation Contractor, JUNE 2013

Bob is pictured with Frank Stamato, Jr. and Roy Day at the ribbon cutting of the association’s first permanent office.

In the early 1970’s, Bob Briant began his long career in the construction industry when he was selected as a staff person for the Construction Industry Advancement Fund (CIAF).Then, in 1973 a young organization called the Utility Contractors Association of New Jersey (UCA) began a search to hire its very first full-time employee. The organization, which had been founded in 1965, had just completed a very successful convention at the Playboy Club in McAfee, NJ for the National Utility Contractors Association (NUCA). The convention attracted approximately 1,500 attendees and featured the first Equipment Exhibition ever held by NUCA. At the time the UCA’s total membership consisted of 60 firms in the utility construction industry, but because of the success of this convention the UCA was able to establish permanent offices and hire a full time staff to administer to the needs of its growing membership. A search committee led by Roy Day, the association President at that time, was formed to find the right individual to assume the newly-created staff position. Joining Mr. Day on the search team were Frank Stamato, Jr., Ed Cruz and George Harms. In a stroke of good fortune Ed Cruz met Bob Briant at a scholarship presentation at Union County College and, during their conversation, Mr. Cruz mentioned that the UCA was looking for a new Executive Director. Bob was interested and sought the advice of Joseph D. D’Annunzio. With

Bob and George Harms flank Governor Brendan Byrne.

Bob presents a birthday cake to industry icon Larry Gardner.

Bob discusses construction funding with Congressman Bob Roe. Utility and Transportation Contractor, JUNE 2013

Mr. D’Annunzio’s encouragement, Bob aggressively pursued the opportunity. On the recommendation of the search committee, the UCA Board of Directors hired Robert A. Briant as its first full time Executive Director, and Bob began his employment during the Summer of 1973 at the association’s office in Edison, NJ. With Bob at the helm, the association began an astounding period of growth and diversification which was unequaled by any other state construction association in America. Under Bob’s leadership and with a talented, professional group of individuals on the Board of Directors, the UCA achieved great successes for the benefit of its members. In 1983, the organization affiliated with the American Road and Transportation Builders Association (ARTBA) and changed its name to the Utility 5

Bob is pictured with Governor Chris Christie and his brother, Captain Charles Briant, retired, at a Vietnam Veteran’s Memorial event.

and Transportation Contractors Association of NJ (UTCA). This enabled the association to recruit new contractor members that were engaged in the bridge and highway construction industries. Through Bob’s guidance the UTCA also began diversifying its membership base to include firms that performed hazardous waste remediation work. The growth of the association reached a top level of 1200 member firms during Bob’s tenure. As the association’s numbers began to grow and the services to the members expanded, Bob Briant hired and trained several association staff members who themselves have had long careers in the industry thanks to Bob’s mentoring. In 1982, the association hired Robert Briant, Jr. to assist his father with association services. Bob Jr. now serves as the Chief Executive Officer for the association. Bob, Sr. and Bob, Jr. formed a formidable team in guiding the group’s activities. One of Bob Briant’s favorite duties for the UTCA was the editing and publishing of the association’s award-winning magazine. This was a service that he continued through earlier this year.

Standing left to right are Jerome Frommer, Fletch Creamer, Jr. and Bob.

Bob with Bob Briant, Jr. during a trip to Italy.

Lee DeAlmeida, left, and Bob, third from left, with representatives of the National Utility Contractors Association during a visit to Capitol Hill. 6

In 1980, Bob Briant received the UTCA’s annual William H. Feather Memorial Award in recognition of his dedication and inspired work efforts, and in 1992 Bob was selected as the Construction Man of the Year by the New Jersey Subcontractors Association. He was a member of the Board of Trustees for the NJ Environmental Infrastructure Trust for many years and served as the Trust’s chairman for a long stint during his tenure. In December 2005 Bob Briant, Sr. was the driving force in the creation of the Clean Water Construction Coalition, which now includes 27 contractor organizations from around the nation. This Coalition promotes increased funding for water and sewer construction and Bob was selected as the first chairman of the group. He developed long-time relationships with business managers in organized labor, especially Richard Tissiere and Ray Pocino, two wellrespected representatives from the Laborers union. Utility and Transportation Contractor, JUNE 2013

It was at the end of 2005 that Bob Briant stepped down as the CEO of the UTCA of NJ. However, he continued as a consultant to the association and his knowledge, experience and continued devotion to the organization provided invaluable guidance to his successor as CEO, Bob, Jr. as well as to the rest of the staff and Board of Directors. During the past seven years, Bob not only continued to produce the association magazine, but he also assisted with the annual convention, executive seminar, membership development, and several other duties. Most importantly, he was always a source of wise counseling and good advice on all matters that affected the UTCA and its member firms.

events such as sporting competitions, scholastic achievement banquets and music concerts. It was indeed a proud day for “Poppa Bob” (as he was known to the grandchildren) when his oldest grandson Colin was accepted to the U.S. Military Academy at West Point. Upon the passing of this unique and respected individual, the UTCA Board of Directors organized a “21 loader salute” on the day of Bob’s funeral. Following the service, the funeral procession drove past 21 heavy equipment loaders on Route 34 which had been set up earlier in the day. Each loader had its bucket held up majestically as a tribute to Bob and an American Flag was raised to drape the equipment. Bob Briant, Sr. would have been very proud. He loved this industry, he loved his country, he was devoted to his family and was loyal to his many friends. Bob’s loss will be felt for many, many years to come on both a personal and professional level. This industry has lost one on its all-time leaders, and Bob’s memory will be an inspiration for years to come.

Bob presents a plaque to Congressman Bob Gibbs on behalf of the Clean Water Construction Coalition.

After living for many years in Manasquan, NJ, Bob and Carole relocated to Point Pleasant and then to Bay Head before returning to a newly constructed townhouse in Point Pleasant. Bob had a passion for wine collecting and good books and was especially fond of films about World War I and World War II. His favorite film was the classic “They Were Expendable” starring John Wayne. Bob was also a lover of Broadway theatre. However, his greatest love was reserved for his family, especially his wife Carole, children Bobby, Michael and Joanne and their spouses Debbie, Donna and Sam. Bob held a very special place in his heart for his six grandchildren Colin, Hannah, Thomas, Katherine, Michael and Joseph. He was routinely present at his grandchildren’s special

Pictured with Governor Christine Todd Whitman are Joe DeSanctis, Bob, Sr., Fletch Creamer, Jr., Bob, Jr., Jerry Liguori and Ed Nyland. Utility and Transportation Contractor, JUNE 2013

Bob is pictured with Colonel Oliver North at UTCA’s 25th Anniversary Convention in 1990.

The “21 loader salute” to Bob Briant, Sr. 7

Utility and Transportation Contractor, JUNE 2013

“Softly the leaves of memory fall. Gently we gather and treasure them all. Unseen, unheard, you’re always near. So missed, so loved, so very dear, no longer in our lives to share. but always in our hearts--you’re always there.

Carole, Bobby, Debbie, Michael, Donna, Joanne, Sam, Colin, Hannah, Thomas, Catherine, Joseph and Michael

Utility and Transportation Contractor, JUNE 2013

A LEGACY OF EXCELLENCE AND SUCCESS

By: Steven Brawer, Association Legal Counsel

In Everything He Did, Bob Briant Was Larger Than Life Since the untimely passing of Bob Briant, Sr. on February 27, 2013 there have been numerous honors bestowed in memory of a great man. From the “21 loader” salute by the Association’s Board of Directors on the day of Bob’s funeral to the designation of the UTCA annual golf event as the Robert A. Briant, Sr. Memorial Scholarship Golf Outing to the posthumous grant of the inaugural Cliff Heath Distinguished Leadership Award by the NJ Asphalt Pavement Association, Bob has been recognized for the many contributions he made to the construction industry in New Jersey over his illustrious 40 year career. He truly was a giant who as much as anyone was responsible for the growth and achievements of the UTCA since he was named executive director of the fledgling group known as the Utility Contractors Association of New Jersey in 1973. Those who were privileged to work with Bob over the years know that his many successes were no accident. A consummate professional, everything Bob did in his management of the Association was the result of hard work, careful planning and an uncanny ability to get the best out of everyone with whom he came into contact. A great motivator, Bob always inspired outstanding performance because he never accepted anything less from himself or from others. With Bob no detail was too small and nothing was ever left to chance. Nobody knows this better than the individuals who served as president of the UTCA under Bob’s tutelage who were always provided with talking points that were generated by Bob to make sure that things worked smoothly. Whether it was a membership meeting or the Annual Convention or an Executive Seminar trip, things inevitably worked like clockwork because Bob would not tolerate anything less. Overseeing the activities of the UTCA, and building it into the preeminent Utility and Transportation Contractor, JUNE 2013

contractors association in the nation, wasn’t just a job for Bob — it was his passion. He worked tirelessly both in New Jersey and with such national groups as the American Road and Transportation Builders Association and the Clean Water Construction Coalition to address a wide range of issues which affected the growing number of construction firms affiliated with the Association. As the UTCA membership grew in numbers it also increased its public posture, becoming one of the most influential

and respected construction industry advocacy groups in Trenton and Washington, D.C. The Association also expanded the range of membership services it provided in such diverse areas as health and safety training, group health insurance and discount purchasing programs. All this was a result of Bob Briant’s stewardship and his unceasing commitment to make the UTCA the invaluable contractor resource that it has become in fulfillment of Bob’s vision. Bob was also a shrewd judge of character and capability who had an uncanny knack of surrounding himself with good people and then getting the utmost out of them. Over the years the UTCA has been blessed with outstanding staff people who were selected by Bob and motivated to always give their best — just like their leader!! Perhaps the best illustration of this talent was the guidance which Bob, Sr. gave to his

son and successor. As a green 23 year old when he was hired by his dad in 1982, Bob, Jr. had much to learn about the construction industry and how to manage the affairs of a growing trade association, and he couldn’t have had a better teacher and mentor than Bob, Sr. The continuing success which the UTCA has achieved since Bob, Jr. became CEO in 2006 is largely a tribute to the work ethic, leadership skills and practical handson lessons which a loving father passed on to a dedicated son. As the “face” of the Association which he led for nearly four decades, Bob Briant became one of the most respected construction industry figures in New Jersey. His integrity was unquestioned and his word was his bond. Bob understood that his success and the success of the UTCA was a matter of credibility, and nobody in the construction business or the association management profession had more credibility than Bob. For all his professional accomplishments, Bob Briant’s most enduring legacy relates to his personal attributes. He was a warm and caring individual who loved his friends, his God and, most of all, his family. If you were fortunate enough to be counted among his legion of friends there wasn’t anything Bob wouldn’t do for you. He was always sending photographs or suggesting book titles to his network of contacts, and he was a connoisseur of fine food and wine who was a wonderful dinner companion. Bob truly enjoyed the time he spent with his friends and they greatly valued his company. Bob Briant, Sr. was one of those rare individuals who was larger than life. He was someone many counted on and he never disappointed. Bob made everything and everyone he touched better. Although he is no longer with us in person Bob Briant’s indomitable spirit is still alive and will never be forgotten by those who knew and loved him. 11

Utility and Transportation Contractor, JUNE 2013

ROBERT BRIANT, SR’s LEGACY Responsible, Sustainable & Affordable Economic Development In New Jersey By: Chris Colabella, President, CIS The New Jersey Environmental Infrastructure Trust, a fund that provides low-cost financing for the construction of environmental infrastructure projects, may very well be the shining star on the late Robert Briant Sr.’s list of lifelong accomplishments. Indeed, the fact that New Jersey enjoys a national reputation as a leader in innovative and effective environmental protection strategies is owed – at least in considerable part – to Briant’s efforts to encourage responsible and sustainable economic development in the Garden State. Bob Briant Jr., Briant Sr.’s son and, perhaps, his most notable accomplishment, is poised to continue in his father’s footsteps having joined the Trust’s board since his dad’s passing on Feb. 27, 2013. “I wish to continue my father’s efforts to always look to increase funding for the infrastructure needs of New Jersey as well as work to streamline the funding processes of the Trust,” said Briant Jr., noting the construction landscape in New Jersey would look quite different today if it weren’t for his dad’s commitment. “I believe the industry would be more fragmented and certainly the many achievements — laws and regulatory changes, funding, etc. — that have provided a better working environment for the industry, would not have taken place.” Since its creation in 1986, as the first program of its kind in the country, the Trust has played a major role in helping New Jersey meet one of its most fundamental environmental priorities -maintaining and improving the quality of water resources. However, David Zimmer, CFA, and executive director of the Trust, says controlling pollution and providing safe, abundant drinking water requires heavy capital investment. “Environmental infrastructure is costly to build and that expense is ultimately born by the individual ratepayer and taxpayer. Keeping costs to the public as low as possible has been the role of the Trust since its inception.” Enter the Clean Water Construction Coalition, formed in an effort to bring federal dollars to the N.J. Environmental Trust and to the other 49 states in the country. The Coalition, whose first meeting was conducted by Briant Sr. in 2005 when he was CEO of the Utility and Transportation Contractors Association of New Jersey, is a national organization of construction associations formed to promote federal legislation that improves water and wastewater infrastructure on a national level. Briant Sr. served as the Coalition’s first chairman and Bob Jr. has recently been elected to the position of chairman. “Sustainable living means doing right by the environment so the environment can do right by you. You have to balance the need for growth with environmental consciousness,” said Zimmer. “Bob understood that. He understood you can’t push too hard against the environment or development. You have to get the two to work together. At the end of the day, he led the Trust and the Coalition as vehicles for public policy implementation.” Working in partnership with the N.J. Department of Environmental Protection, the Trust leverages funds available from the federal government to make more money available at the lowest possible cost. Since 1987, the Trust’s Financing Program has provided more Utility and Transportation Contractor, JUNE 2013

than $4.3 billion to local and county government units and some private water companies to finance wastewater systems, combined sewer overflow abatement, nonpoint source pollution control, safe drinking water supplies and open space acquisition. Zimmer said there is no way qualified entities in New Jersey can borrow money at a cheaper rate than with the Trust. “The Trust has the ability to reduce interest costs to the point where a qualified borrower will pay between 25 to 35 percent of the total loan value. There isn’t a lending program in the state, public or private, that can produce that kind of value for ratepayers and tax payers.” As an example, Zimmer said: “Let’s say a town wants to borrow a million dollars from the Trust; our rate is about 65 basis points for 20 years. The U.S. government can’t even borrow at that rate for 20 years! So, on a million dollars, a Trust loan would cost about $70,000 in interest. Even if a well-rated New Jersey town did that on its own, it would pay three percent. That adds up to $1.35 million in interest over 20 years.” An added benefit of the Trust’s Construction Loan program is that borrowers may take up to 36 months for construction, and repayments don’t begin until the job is complete, Zimmer said, noting that if delays occur, a borrower may be required to start repayments before construction is completed. “Let’s say you are doing a sewer deal that includes extending pipe to 20 houses. Until you get that pipe in the ground, you won’t be collecting sewer fees,” he explained. “The Trust will let you defer the principal and interest up to construction completion as long as it happens in under 36 months.” The format, Zimmer added, creates a unique cash flow management strategy for borrowers. While the amount of money lent varies each year, “qualifying borrowers have never been turned away since the program’s inception in 1987,” Zimmer said. Loans have ranged from $50,000 to $214 million. The N.J. Environmental Trust’s Loan Process: Initial loan applications must be e-filed at www.njeit.org/njeifp during the first week of October each year. The total application packages, with documentation of engineering specifications, are due to be filed the following March. All applications are reviewed by the N.J. DEP; the projects are then vetted and bonded. For more information, visit www.njeit.org. About the Author: Chris Colabella is the president of CIS, Inc., parent company of CIS Leads and C-Source, the construction industry’s premier local lead service. Learn more about CIS, which is celebrating 20 years in business, or schedule a free demonstration of CIS Leads, by calling 800-247-1727 or visit www.cisleads.com.

Utility and Transportation Contractor, JUNE 2013

STRATEGIC BUSINESS PLANNING IS KEY TOOL OF THE TRADE By: Wm. J. Ruckert, III The Provident Bank

The economy is still plodding, competition remains intense and margins continue to be tight – but there are reasons for contractors to be bullish on the construction industry. Hurricane Sandy continues to have an impact in New Jersey. Although the bulk of anticipated work from the storm has not come to fruition yet, the reality is New Jersey has about $70 billion worth of leaky pipes, crumbling roads, deficient bridges and vulnerable power lines. There is no question that there is lots of work to be done – including new projects that are unrelated to post-Sandy rebuilding. For example, three major bridges connecting New Jersey and Staten Island will get facelifts totaling nearly $3 billion over the next several years. The Port Authority recently approved contracts for work on the Bayonne and Goethals bridges and the Outerbridge Crossing, all to begin this year. New Jersey Transit also has plans for a “flyover” track and a new train station in North Brunswick, and other planned work around the state. There are a multitude of opportunities for these projects. The question is: is your business prepared to bid on and handle this work? As many in the heavy construction industry can attest, it is not always easy to predict when jobs will be awarded, but having an up-to-date business plan is key to staying on track. Contractors need to view a strategic plan as a “must-have” tool rather than a “nice-to-have” tool – that thinking can be the difference between capitalizing on new projects or missing out entirely.

Before making “best guesses” when it comes to your financing needs, consider talking to your bank. They can provide valuable, industry-specific insight for your business planning, and help you project cash flow and borrowing needs, while identifying the right products and services for your business. First, discuss your company’s overall operating costs and cash flow. In this area of business planning, borrowers need to be as accurate and realistic as possible. This is particularly important if you are looking to increase your line of credit. Give a practical depiction about your company’s profits and cash flow going forward so that both longand short-term capital needs can be accurately predicted. The reality is that every industry needs a different level of working capital. However, contractors have unique needs due to seasonality, vendor terms and continued pressure on accounts receivable collections. It’s important for business owners to work with a lender who has real experience helping companies in this industry. We realize contractors tend to be capital intensive for a variety of reasons – equipment costs and seasonality are among the most prevalent. By looking at backlogs, you can make a fairly reasonable guess as to what will turn into revenue, and what areas may continue to be challenging. For example, if your accounts receivables are getting stressed, what will that do to your working capital? A lender can help business owners take a look at these scenarios and find a financial solution.

A second area where lenders can be valuable is evaluating a business’ cash flow cycle – from payroll and supplies to anticipating new project needs. For most contractors, this is an ongoing challenge, especially when projects are awarded. Your working capital line of credit is an ideal way to cover operating expenses. A capital expenditure line of credit can support equipment needs. However, it’s important to use this financing option appropriately and set expectations about repaying the debt. With regard to non-credit products, your bank can recommend cash management tools, such as remote deposit capture and sweep accounts to help contractors save time and money. These financial products should be part of overall plans. Good cash flow management is essential and can make even the most successful company that much more profitable. While some banks may shy away from the construction industry, Provident Bank can be a value-added member of your forecasting team. We have extensive experience working with contractors in formulating cash flow projections, and in turn, customizing financing programs to correspond with each company’s unique needs. As you begin to update your business plan and budget for the remainder of the year, and for next year, remember to involve your lender. They can provide sound financial advice and be valuable resources in finding the right solutions that work for your business.

Continued from Page 55 disability, the employee may then be entitled to time off under the NJFLA for the birth or adoption of a child or the serious illness of a parent, child or spouse. The NJFLA’s definition of “parent” includes a parent-inlaw or a stepparent. An employee must provide a minimum of thirty (30) days notice to her or his employer before commencement of leave to bond with newborn or newly adopted children. In an

instance where an employee wants to take leave to care for sick family members, notice is still required; however, an emergency or other unforeseen circumstances that prevents proper notice from being given may excuse the notice requirement. Advice for UTCA Contractors: The most common issues that arise concerning the FMLA and the NJFLA is whether or not an employer meets the definition of a “covered employer” such that

the provisions of the law apply and if so, whether the employee has given proper notice of a request for leave. UTCA Contractors should work with legal counsel to make sure that these and other issues are addressed promptly and in compliance with the laws. Time spent now will avoid costly litigation in the future.

Utility and Transportation Contractor, JUNE 2013

Legislative News

By: Evan Piscitelli, Legislative Director

Federal and State Update As UTCA gears up for its annual Washington D.C. Fly-In, there will be some cause for good spirits upon our arrival in the nation’s capital, and consequently, an even greater need to push harder when we sit down with lawmakers. On the legislative front, two very significant initiatives have been progressing in recent weeks, both dealing with the utility side of our industry. Significant action is taking place on the Water Resources Development Act of 2013 and the Water Quality Protection and Job Creation Act, S. 601 and H.R. 1877 respectively, and our representatives will be focused on keeping the momentum going. The Senate recently passed the Water Resources Development Act (WRDA) on a bipartisan basis, the first significant action on the bill since it was last passed in 2007 over a Presidential veto. WRDA funds projects associated with the Army Corps of Engineers and the nation’s waterways infrastructure. Along with more robust funding for construction, the bill seeks to implement key policy changes designed to improve the environmental review and approval process so that projects are not unnecessarily hampered by red tape. S. 601 now heads to the U.S. House of Representatives where Transportation and Infrastructure Committee Chairman Bill

Utility and Transportation Contractor, JUNE 2013

Shuster has reaffirmed his support for taking up the measure in early summer. On another positive note, Representative Tim Bishop (D-NY) has reintroduced legislation that would reauthorize the Clean Water Act and amend the current law to establish a clean water trust fund. The Water Quality Protection and Job Creation Act of 2013, H.R.1877, is identical to the Congressman’s bill that he introduced last year. The legislation would authorize $13.8 billion over five years for the Clean Water SRF program and an additional $600 million would be available for storm water management projects. Currently, the bill has 27 cosponsors on a bipartisan basis. In concert with the National Clean Water Construction Coalition, UTCA will keep the pressure on lawmakers to support these important utility construction bills. More often than not, this column details our progress on bolstering construction funding or improving public contracting in some way. However, there are times when issues not related to the business side of the industry deserve to be promoted in the Legislature with our help. Our Association is proud to be involved with “Nikki’s Law”, an initiative aimed at raising more awareness on our roadways that texting while driving is illegal. Named after 18-year old Nikki

Killenyi, the daughter of one of our members who was tragically killed in a texting-while-driving related car accident, this legislation continues to make significant progress and will likely reach the Governor’s Desk by summer. When Mr. Killenyi, of member firm Highway Safety Systems, approached our Association for help in getting this legislation off the ground, there wasn’t a moment’s hesitation. Our CEO, Bob Briant Jr., organized a meeting with Assembly Transportation Chairman John Wisniewski, who later introduced the bill and moved it quickly in his committee. The dangers related to drivers that are more focused on typing a text message than keeping their eyes on the road confront us all each day. This practice is obviously illegal, but more needs to be done to educate the driving public that this dangerous behavior is a crime that will be punished severely. So far Assembly Bill 3873 has secured strong bipartisan support, and our Association will continue to push for its prompt approval.

Utility and Transportation Contractor, JUNE 2013

UTCA MEMBERS ENJOY TURKEY/GREECE EXECUTIVE SEMINAR Attendees Experience A Trip Of A Lifetime This past April, a total of 48 UTCA members, spouses and family members experienced a monumental travel excursion to Turkey, Greece and the Greek Islands. The travelers were able to view sites of historical and religious significance, while also learning of the rich cultures of the countries.

The excursion then brought the UTCA group to the Silver Wind cruise ship for a seven day cruise. The vessel was magnificent and

Ruins of the ancient city of Troy.

Pictured here is the Blue Mosque in Istanbul, Turkey.

The group left from New York on April 7 and arrived in Istanbul, Turkey the following day. The two day stay at the Kalyon Hotel included amazing tours of the city. On day one, informative tour guides led the attendees to the Blue Mosque and Saint Sophiaâ€™s Church in the city followed by a visit to the Grand Bazaar. Attendees were also able to visit a shop that produces hand-made carpets. The second day allowed the visitors to see Topkapi Palace, which served as the primary residence of the Ottoman Sultans for approximately 400 years. Portraits of the sultans and exhibits of the crown jewels were just some of the items that were seen by the people. Following a scenic boat ride on the Bosphorus, the tour ended at the Spice Market which dates back to 1597.

offered first class amenities to all passengers. Attendees were offered several options for each daily tour. The first port of call for the cruise was Canakkale, which allowed people to view the ruins of ancient Troy. The Greek writer Homer wrote the tales of the Trojan War in his epic literature, The Illiad. The existence of Troy had long been considered fable until it was discovered by the German businessman Heinrich Schliemann in the late 19th century.

Pictured from left to right are UTCA Board Members, Frank Renda, Michael Dâ€™Annunzio, Roger Wuestefeld and Scott Lattimer.

The remains of the Parthenon in Athens, Greece 28

The tour continued with a trek up a mountain to an ancient village called Assos. The Greek philosopher Aristotle spent several years in this village which also boasts one of the temples to the Greek Goddess Athena. The next day brought the group to a site of major religious significance. Visitors were allowed to enter a first century dwelling Utility and Transportation Contractor, JUNE 2013

Seminar attendees are photographed outside a carpet store in Istanbul.

The entrance to the Grand Bazaar in Istanbul.

which is believed to be the final home of the Virgin Mary. The tour continued into ancient Ephesus, which dates back thousands of years. Included in these ruins were an ancient library and an arena that was used by Saint Paul when he preached to the Ephesians. The group also viewed the Basilica of St. John which was built by the Emperor Constantine on the site where the Apostle John was buried. The islands of Rhodes and Crete also allowed for the tourists to view the ancient riches of these two sites. Included were the ruins of the palace of King Minos. He was the legendary king of Crete, son of Zeus and the Phoenician princess Europa. On the visit to Rhodes, the attendees saw the Palace of the Grand Master of the Knights of Rhodes. High winds would not allow for the ship to make port on the island of Santorini, which was called Thera in ancient times. The cruise ship then traveled to Myconos, which is particularly

renowned for its cosmopolitan nightlife. It is statutory on Myconos that all buildings are white and clean. There are more than 350 chapels on the island, most of which are small family chapels. The cruise ended by making port in Athens for a two day stay at the Electra Palace. The attendees toured the Acropolis and the Parthenon, and also saw the Temple of Zeus and Hadrianâ€™s Arch. The final day included a scenic bus ride and a mountain-top tour of the Temple of Poseidon. The seminar concluded with a closing reception for the attendees and included a poignant toast to the late Bob Briant, Sr. by long-time UTCA Board Member Frank Renda. Executive Seminar sponsors included the firms of Cohen, Seglias, Pallas, Greenhall & Furman, Garden State Precast and Construction Information Systems The 2014 Executive Seminar will be held on January 11-18, 2014 at the Aruba Marriott Resort.

Utility and Transportation Contractor, JUNE 2013

Accounting Corner

By: William McNamara, CPA Cowan, Gunteski & Co.

Top Ten Ways Your Accounting Firm Should Be Helping You Build Your Construction Company Many construction companies used their accountants as a means to meet their compliance requirements with government agencies, banks, bonding agents and various other third parties. Contractors that have been in the industry long enough have come to realize that the services provided by accountants that specialize in construction accounting can become an invaluable resource for the success, growth and continuation of their companies. The following is a list of services that your accountant should be addressing with you each and every fiscal year: 1. Internal Controls Implementation of solid internal controls is the best way to minimize the risk of fraud, embezzlement and other improprieties within your company. No one ever hires an employee thinking that they will be dishonest; however the reality is that employee theft results in a significant amount of lost profits for companies every day. Establishing and monitoring internal controls for your company will reduce such risks and help maximize profits for your company. 2. Information Technology and Software Selection Anyone who has ever prepared a construction in progress schedule can appreciate the benefits of a good accounting software program. Choosing a software program that meets the accounting and financial reporting needs of your company and is affordable is not always easy. Accountants that specialize in the construction industry are knowledgeable of the benefits of each system and can help you find the right one to meet your needs. 3. Bonding Advice The requirements of your bonding agent can be reduced if you, or your accountant, have a strong working relationship with them. Bonding agents have their own set of criteria that they use to evaluate 34

your financial statements and your company’s overall financial position. Ongoing communication between your bonding agent and accountant will usually reduce issues that may arise and help to amicably resolve any issues which may delay or stop the bonding process. Budgeting and Projections The key to achieving the financial goals of your company is accountability. The first step is the creation of budgets and projections. The second step is to hold individuals accountable for maintaining those budgets and achieving the company’s goals. Your accountant should help you develop budgets and projections, as well as measurable goals to insure accountability. Benchmarking and Results Analysis Many construction companies operate profitably and believe that their business methodology is the best. However, what if you found out that your competitors were operating with significantly higher gross profits, lower operating expenses and higher bottom lines? Most companies would immediately ask “what are we doing wrong?” Establishing benchmarks is similar to budgeting except you identify financial goals attainable in your industry. General benchmarking information can be obtained via the Internet; however your accountant can be a key resource for specific benchmarks that apply to your industry segment and region. Evaluation of Employee Benefits Most construction contractors know that their employees are the primary reason why their companies are successful. Therefore, when the company has the opportunity to financially reward its employees, create

significant write-offs for tax purposes, maximize benefits and compensation paid to its owners and increase overall employee moral, then the implementation or evaluation of an employee benefits plan is a win-win situation. Your accountant, along with the assistance of an independent pension consultant, can help you evaluate your options. Succession Planning Most business owners have a good understanding of how their company operates and are confident that they will continue to be successful for as long as they are at the helm. Not all business owners have planned for the company’s continued success after they retire. Whether your intent is to pass your business down to your own children, turn over the operations to key employees or sell your business outright to a third party, you should begin planning this transition. There are many tax saving strategies that will ensure that your company continues to operate and provide for your financial security. Since most succession planning takes time to implement, you should consult with your accountant to begin your exit strategy as soon as possible. Bank Negotiations Most businesses have a banking relationship with one or two banks. Very few business owners have established working relationship with a multitude of banks and other financiers. Even fewer have the insight to know what financing terms and deals are currently available from different sources and have the ability to acquire similar terms for their businesses. Your accountant should have established personal relationships with numerous bankers and will be

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able to play a key role in negotiating and acquiring the best financing terms for you. Tax Planning The old adage that “people don’t plan to fail, they fail to plan” is never truer than when addressing tax planning. Tax preparation and tax planning are two distinctly different things. Too many companies do not see their accountant until after the end of their fiscal year. Tax planning after the fiscal year end is similar to putting the cart before the horse. In order to be successful, the majority of tax planning needs to be implemented over the course of the year and should be monitored regularly. There are many tax planning strategies that may take years to successfully implement. Unfortunately, a lot of companies do not seek to address such tax planning strategies until it is too late.

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10.

Profitability Enhancement There are three ways to enhance a company’s profitability. The first way is to increase revenues, the second is to decrease expenses and the third is to improve the quality of life of the company owners. When people think of profitability enhancement, they automatically think of a higher bottom line, but what if your accountant came to you and said “I can show you how to increase your gross revenues and gross profit while reducing the number of hours you work?” Most people would jump at such an offer. Your accountant should ask you these types of questions and help you implement solutions. In today’s economy every resource is an opportunity for continued growth. By not making yourself accessible to such resources you are

closing the door to a multitude of opportunities. If the deciding factor in how you hired your accountant was based upon price, you should remember the old saying “you get what you pay for.” A good certified public accountant will help you identify your goals, solve your problems and be your most trusted financial resource. About the Author: Cowan, Gunteski & Co. is one of the leading accounting and consulting firms for the construction industry and, therefore, truly understands the daily challenges and keys to success for builders. We are committed to being an active partner in our builder-clients’ growth by delivering consistent exceptional service, value beyond accounting and innovative solutions focused on their financial goals. To find out more about the services available to meet the unique needs of the construction industry, contact Bill McNamara, CPA, CCIFP®, shareholder-incharge of the Construction Services Group at: bmcnamara@cowangunteski.com or (732) 349-6880.

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ROBERT A. BRIANT, SR. MEMORIAL SCHOLARSHIP FUND

By: Nancy Damato, RDA Benefit Services

Two Annual Scholarships Are Being Established In Bob Briant’s Name Bob Briant Sr. was always a strong believer and supporter of education. As a tribute to Bob Sr., two annual scholarships are being established in his name as part of the UTCA of NJ Sage Scholarship/College Tuition Benefit Program. The winners of the Robert A. Briant Sr. Memorial Scholarship will receive an additional 5,000 Tuition Rewards. A child must be registered to be eligible for the Robert A. Briant Sr. Memorial Scholarship. The UTCA of NJ Sage Scholarship/College Tuition Benefit Program is currently available to all member firms. This program, managed by RDA Benefit Services, LLC, will provide the scholarships to participating members of this program. The awards will be determined by a Scholarship Committee. Member firms are strongly encouraged to participate in this program, as it provides employees—both union and non-union— access to SAGE Tuition Rewards at 300 private colleges and universities across the nation. The program provides up to one full year of college tuition. And 80% of these colleges have earned an “America’s Best” ranking from U.S. News & WorldReports. There is no cost to the employer or employee for participating in this program! This is just one of the benefits that RDA Benefit Services provides to the UTCA membership. All employees have to do is meet with a voluntary benefits counselor from RDA to register a student. When they do this, they begin receiving Tuition Rewards and are on their way to reducing the cost of a college education for their children, grandchildren, nieces or nephews, or any child in the 10th grade or younger! Highlights of the UTCA of NJ Sage Scholarship/College Tuition Benefit Program:

•

Each employee that participates is registered for 500 Sage Tuition Reward points. Spouses can also register for an additional 500 reward points. • Employees receive an annual 5% tuition rewards match of their 401K/403b retirement account balance. • Consider this benefit a great addition to your company’s compensation package, to attract and retain key skilled employees. • Employers also see an increase in 401K/403b participation, as well as a decrease in borrowing from the retirement plans, as a result of this program. To illustrate how this program helps to pay for a child’s college education, assume there is a 12 year old in a family where the employee has a $50,000 balance in his retirement account today, in addition to an annual contribution of $2,000 into the plan and a hypothetical 7% investment return. By the time the child turns 17, there will be over 20,000 tuition reward points in his account (and each point is equal to $1!) Because this program is linked to the opportunity of purchasing voluntary insurance benefits, with only limited medical questions asked, it gives employees the choice to have insurance for as little as a few dollars a week, to meet their individual needs. This includes life, disability, cancer, critical illness and accident insurance. Plans have fixed premiums and are portable. There is no obligation to purchase insurance in order to register for the College Tuition Benefit Program. To learn more about this valuable opportunity, contact Bob Briant Jr., UTCA at 732-292-4300 or Nancy Damato, RDA Benefit Services, LLC at 855-693-0772 (toll-free.)

Bob Briant is pictured with his grandson, Colin, at a West Point baseball game. It was a proud day for Bob when Colin was accepted to the US Military Academy at West Point. Utility and Transportation Contractor, JUNE 2013 51

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PASCRELL LETTER PDF IN FILE

Utility and Transportation Contractor, JUNE 2013

Labor Relations

By: Jill Tobia Sorger, Esq.

Family and Medical Leave Revisited Both the federal Family Medical Leave Act (“FMLA”) and the New Jersey Family Leave Act (“NJFLA”) are undoubtedly positive laws that attempt to balance the often competing demands of family and the workplace. While the enactment of these laws has definitely effectuated an overall positive change in the employer/employee relationship, the challenges of implementing and applying the laws have proven to be extremely complex, arduous and time consuming for employers. Additionally, employers often mistakenly fail to comply with certain technical aspects of the law thereby unintentionally creating confusion and in some instances costly legal proceedings. Accordingly, it is important for UTCA Contractors to stay updated on the law and to ensure that their FMLA and NJFLA policies and procedures adequately address the nuances of the laws. A Brief Overview Of and Comparison Between the Federal Family Medical Leave Act and the New Jersey Family Leave Act:

Both the federal Family Medical Leave Act (FMLA) and the New Jersey Family Leave Act (NJFLA) laws provide substantially equivalent coverage. The federal FMLA and the State NJFLA offer covered employees up to twelve (12) weeks of unpaid, job-protected leave for certain family and medical related reasons. The FMLA provides up to twelve (12) weeks in a 12-month period while the NJFLA provides up to twelve weeks in a 24-month period. The 24-month period begins on the first day of the employee’s first NJFLA leave. The employer can require the utilization of up to two (2) weeks of vacation and/or paid time off (PTO). Like the NJFLA, the FMLA provides time off from work in connection with the birth or adoption of a child or the serious illness of a parent, child or spouse. When an employee takes a leave for a purpose covered by both the FMLA and the NJFLA, the leave simultaneously counts against the employee’s entitlement under both laws. To be eligible for family leave under the NJFLA, an employee must be employed in

New Jersey by a covered employer. Private employers with 50 or more employees are covered employers under the law. Under the NJFLA, all employers with 50 or more employees anywhere worldwide must comply with the NJFLA. Under the FMLA, at least 50 of those employees must be within 75 miles of the employer’s worksite. Under the NJFLA, an employee must have been employed for at least twelve (12) months for the employer, and must have worked 1,000 base hours in the preceding twelve (12) months. Under the FMLA, the employee must have worked at least 1,250 hours in the preceding twelve (12) months. The FMLA provides time off from work due to an employee’s own disability, while the NJFLA does not provide covered employees with leave for their own disabilities. Even though an employee may utilize all of his or her allotted time under the federal FMLA due to his or her Continued on Page 17

In Memory of Robert Briant Sr. 2604 Atlantic Avenue, Wall, NJ 07719 732-528-2170 - Fax: 732-528-2174 Utility and Transportation Contractor, JUNE 2013

Utility and Transportation Contractor, JUNE 2013

INSURING JOINT VENTURES

By: Carl Bloomfield & Jim Marquet The Graham Company

JVs Offer Advantages, But Create Added Risk. Here’s How To Partner Smart. You’ve made it through the Great Recession; but now that the economy is rebounding, contractors need to evaluate how they can better avoid or spread the risk on any given project. Projects that are large, complicated, have onerous contract language and liquidated damages should not be chased unless the contractor has identified a way to limit or spread the project’s risk. If you’re working outside your geography or expertise, a joint venture may be the smartest way to insulate your balance sheet from some of the project’s risk. But, while forming a Joint Venture offers many advantages, it also creates additional risks. One of the keys to a successful Joint Venture is having a risk management approach that addresses these additional risks.There are two main approaches to insuring Joint Ventures: 1. The Joint Venture SelfPerforms the work, and the liabilities of the Joint Venture partners are shifted to the Joint Venture 2. Joint Venture holds the contract for the job, but subcontracts work to Joint Venture partners, and the liabilities of the Joint Venture are shifted to the Joint Venture partners APPROACH 1: JOINT VENTURE SELF-PERFORMS THE WORK In the first option where the Joint Venture self-performs the work, the primary insurance for the activities will be provided by the Joint Venture’s policies. The partners of the Joint Venture should obtain indemnification protection in the Joint Venture Agreement and be added as “Additional Insured” on the Joint Venture’s General Liability and Umbrella Liability 60

policies. This will transfer the exposure away from the insurance policies of the individual partners. In addition, the Joint Venture’s Workers Compensation policy should include an “Alternate Employer Endorsement” naming the partners to ensure that any injury to a Joint Venture

employee is insured under the Joint Venture’s Workers Compensation policy and not the individual partners’Workers Compensation policy. EXPERIENCE MOD FOR JOINT VENTURE When the Joint Venture is self-performing the work, there will be a Workers Compensation Experience Mod created for the Joint Venture. In simple terms, a Workers Compensation Experience Mod is a factor calculated by the Workers Compensation Bureau based on a company’s prior loss experience. If ABC Company has lower loss experience than the average company for its class of business, ABC receives a credit Mod (such

as .750). This credit Mod correlates into a 25 percent discount off of the standard Workers Compensation insurance rates. Conversely, if ABC Company has loss experience that is higher than the average company for its class of business, ABC receives a debit Mod (such as 1.400). This debit Mod correlates to a 40 percent surcharge to the standard Workers Compensation insurance rates. In most situations when a new entity is formed, the entity will get a 1.00 Experience Mod. This is not always the case with Joint Ventures.With a new Joint Venture, there is no prior Loss Experience, so how do the Workers Compensation Bureaus address new Joint Ventures? Even though a Joint Venture is a new entity, the majority of states will create a “blended” Mod based on the Experience Mod of the Joint Venture Partners. For example, if a new Joint Venture is a 50/50 partnership formed between XYZ Contractor (who has a .90 Mod) and ABC Contractor (who has a 1.30 Mod), the Joint Venture would have a 1.10 Mod in most States. However, Pennsylvania and Delaware are two states that do not have a “blended” arithmetic average rule and would use a 1.00 Mod for the new Joint Venture. RENTED EQUIPMENT An additional issue when the Joint Venture is self-performing the work is the need for rented equipment. Typically the Joint Venture will rent vehicles or equipment from the individual partners since the Joint Venture does not have any of its own equipment. To properly transfer this risk to the Joint Venture, there should bea formal Rental Agreement between the Partner and the Joint Venture, and the Joint Venture should purchase its own Auto Liability policy. APPROACH 2: SHELL JOINT VENTURE The second option for setting up a Joint Venture is where the Joint Venture only holds the contract for the job and Utility and Transportation Contractor, JUNE 2013

subcontracts the work to the Joint Venture partners. This is typically referred to as a “Shell Joint Venture.” In this approach, the goal is to transfer liabilities away from the Joint Venture’s insurance policies to the Practice insurance policies maintained by the individual partners; this is the opposite of what is done when work is self-performed in Approach 1. The Joint Venture should obtain indemnification protection from the individual partners in the Joint Venture Agreement and be added as “Additional Insured” on the Joint Venture partners’ General Liability and Umbrella Liability policies. In addition, the Joint Venture partners’ Workers Compensation policies should include an “Alternate Employer Endorsement” naming the Joint Venture to ensure that any injury to a Joint Venture partner employee is insured under the Joint Venture partners’ Workers Compensation policy and not the Joint Venture’s Workers Compensation policy. CERTIFICATES OF INSURANCE FOR THE OWNER One of the challenges with a “shell” approach is the Joint Venture holds the contract with the Owner, and some Owners will require that the Joint Venture provide a Certificate of Insurance thatevidences the Joint Venture as a Named Insured for the limits of insurance required for the job.Most “shell” Joint Ventures will purchase a General Liability and Workers Compensation policy in the name of the Joint

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Venture. However, if the Owner requires the Joint Venture to also have its own Umbrella and Excess Liability coverage (which may be a $25 million limit required in the contract), the additional cost of these Joint Venture limits can be a challenge. Some Owners will accept a Certificate of Insurance from the Joint Venture Partners evidencing their Umbrella/Excess Liability coverage, which adds the Joint Venture as an Additional Insured. COMPLETED OPERATIONS EXPOSURE One of the exposures that is often forgotten with a Joint Venture is the liability for injuries that occur after the work is complete. Most states have a Statute of Repose thatdefines how long a contractor has liability for a project. These statutes can create liability for a Joint Venture for up to 12 years (which is long aftereveryone has left the site and any profits have been divided). In addition, the Partners in a Joint Venture may be liable for the acts of the other Partners and the Joint Venture. For example, if the one Joint Venture Partner goes out of business and no longer maintains insurance, the other Partner that owns only 50% of the Joint Venture may be held liable to pay 100% of the liabilities created by the Joint Venture. Therefore, it is critical that the Partners properly insure the exposures created by the Joint Venture. One way to do this when the Joint Venture is self-performing the work is to purchase “Joint Venture Completed Operations coverage” for the full Statute of

Repose based on the applicable state. This ensures that the Joint Venture would have full liability protection so the Partner’s own insurance won’t be impacted. SUMMARY Joint Ventures have many advantages, but they also create additional liability pitfalls. Prior to forming a Joint Venture, consult with your insurance broker for recommended insurance requirements and indemnification wording to include in the Joint Venture Agreement. These risk management steps can help you avoid the potential surprise of additional costs and liabilities that develop later after the project has been finalized. About the Authors: Carl Bloomfield is a Producer at The Graham Company, one of the largest insurance and employee benefits brokerages in the Mid-Atlantic region. He joined The Graham Company in 2006 and is the co-leader of the Construction Division. He is also an active member of the Professional Services Division. Bloomfield is responsible for new business development in the areas of Property & Casualty insurance, Employee Benefits and Surety. He may be contacted at cbloomfield@grahamco.com Jim Marquet is a Producer at The Graham Company, one of the largest insurance and employee benefits brokerages in the MidAtlantic region. He joined The Graham Company in 2006 and is a Producer. In this role, he is responsible for new business development, technical expertise and client satisfaction. He may be contacted at JMarquet@grahamco.com

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IT’S ONLY “HALF TIME” FOR FEDERAL TRANSPORTATION INVESTMENT! By: Pete Ruane ARTBA President & CEO

In talking about federal surface transportation reauthorization and the new Congress, I can’t help but use a sports metaphor that is very dear to me and my fellow Baltimore natives. You probably saw Super Bowl XLVII on February 3. Maybe you were only watching for the multi-million dollar commercials, or the broadcast was background for a get-together with family and friends. But for me, as a Ravens fan from Day 1—as I was for the dear departed Baltimore Colts before them—it was obviously the ultimate in exhilarating sports experiences… more so because I was able to attend the game in person and with my son. After the usual pre-game hoopla, the Ravens got off to a fast start, leading 21-6 at the half. I couldn’t have felt better about our chances at that point, but as is so often the case in sports and business, momentum is a key driving force. While the Ravens waited in their locker room, the rest of us sat through the super-sized half-time show, with all the pyrotechnics and celebrities. Nonetheless, my fears about “momentum interruption” seemed misplaced when the Ravens’ Jacoby Jones returned the opening kick-off for a touchdown, putting us up by 22. Game over, right? Not so fast. First there was perhaps the most bizarre incident in Super Bowl history, a nearly 35-minute power outage. Then it seemed our worst fears were realized, as the 49ers scored again and again, eventually cutting the Ravens’ margin to two points. Fortunately, though, the Ravens came through with a clutch field goal to lengthen the lead, then made a final goal-line stand to keep San Francisco from breaking through and going ahead with seconds remaining. Now that the Super Dome has emptied and the championship parade has run its course through Charm City, I’ve been thinking about the lessons we can learn.

It occurs to me the transportation construction industry is now positioned like the Ravens at half-time. Yes, we played a major leadership role in helping pass MAP-21 last year, which includes a number of landmark policy reforms. So we’ve put some serious points on the board. But we haven’t won anything yet! They don’t hand out the Lombardi Trophy to the team that has the lead at half-time. Similarly, we still have a lot of work to do on Capitol Hill before we can drop the confetti and balloons. We just welcomed the new Congress to the Nation’s Capital and saw President Obama sworn in for his second term. Transportation Secretary Ray LaHood announced he is moving on after declaring “America is one big pothole!” This all reminds me of the Super Bowl half-time show (lots of fancy sounds and fury signifying nothing?). And while there are surely more distractions and political power outages ahead, we must keep our focus on the “second half” and the need for long-term, increased federal transportation investment. This could come through comprehensive federal tax reform, the MAP-21 reauthorization bill, or some other unexpected vehicle. You can be assured that ARTBA is keeping the ball moving down the field every day. However, we need you to do your part. Get in touch with your members of Congress now and let them know that MAP-21 was only the “first half.” Like the Ravens, we need to keep fighting until the clock runs out and we can hoist that trophy! ### The preceding article has been reprinted with permission from the American Road & Transportation Builders Association (ARTBA). UTCA is an affiliate of ARTBA. For more information, visit www.artba.org.

Continued from Page 89 investments will not be cut, the reductions in other programs adds further uncertainty into an already challenging situation for many state budgets. Over the long run, population growth, the rebound in the housing market and the improving economy will continue to put increased demands on the U.S. transportation network. Recognizing this challenge, there are currently twenty states that are discussing some sort of proposal to increase revenues for transportation. The future of the transportation construction market—as well as the U.S. economy—will depend on the ability of politicians at the local, state and federal level to increase investment to meet that growing Utility and Transportation Contractor, JUNE 2013

demand. Alison Premo Black is ARTBA’s Chief Economist. The forecast uses an ARTBA econometric model that takes into account a number of economic variables at the federal, state and local level. It is measuring the public and private value of construction put in place, published by the U.S. Census Bureau. The ARTBA estimate of the private driveway and parking lot construction market is based on data from the U.S. Census Bureau’s “Economic Business Census.” For more information, visit www.artba.org. ### The preceding article has been reprinted with permission from the American Road & Transportation Builders Association (ARTBA). UTCA is an affiliate of ARTBA. For more information, visit www.artba.org. 71

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UTCA CONDUCTS FIRST SPORTING CLAY SHOOTING EVENT Proceeds Benefit Scholarship Fund Several years ago, the UTCA Executive Seminar was held at Casa De Campo in the Dominican Republic. This location offered many facilities for visitors including a Clay Shooting Range. The attendees enjoyed the activity during the visit to this location and interest was generated in conducting a similar event for members in the New Jersey or Eastern Pennsylvania area.

the event and prizes were awarded to the first and second place teams. Each of the shooting stations had unique facets and their own characteristics. On some of the stations, rabbits raced along the ground. On other spots, players shot across a lake, while on other stations, targets came towards the shooter. There were stations located between old buildings that required participants to shoot between walls. On another station, the clay rolled up a ramp and jumped in front of the shooter. Following the shooting event, players were treated to a pig roast and barbeque lunch, including cold beverages. Cigars were also available, courtesy of Northeast Remsco Construction and Vollers Excavating & Construction. UTCA’s Senior Vice President Harry Chowansky and Bob Cavaliere thanked all sponsors and then presented door prizes as well as the awards to the winning teams. The top scoring team included Dan Culnen, George Maggiolo, Don Fuentes and Bob Cavaliere. Finishing in second place was the team from the Heritage Guild. George Maggiolo and Steve Venckus tied for the best overall individual score for the day. The top door prize was presented to Dave Marks of Liberty Mutual who received a $500 gift certificate to the Lehigh Valley Sporting Clay facility.

The Harm’s team watches as Robbie Harms hits the clays on Station 1.

UTCA Board member Bob Cavaliere and staff person Dan Neville took the lead in arranging such an event which was held on May 2, 2013 at Lehigh Valley Sporting Clays in Coplay, Pennsylvania. Participants were arranged in teams of four shooters on the thirteen station course. As players arrived, breakfast was available and was sponsored by D’Annunzio & Sons and Earle Asphalt. A barbeque lunch, sponsored by C & H Agency, Foley, Inc. and George Harms Construction, followed

Harry Chowansky, left, is pictured presenting a trophy to “The Top Shots”. Bob Cavaliere, George Maggiolo, Don Fuentes and Dan Culnen were the winning team at the event.

Chris D’Annunzio attempts to shoot the clay as it flys between the buildings on Station 7. Utility and Transportation Contractor, JUNE 2013

Additional sponsors for this event included B. Anthony Construction, B & W Construction, Binder Machinery, The Dale Group, Dewcon, Inc., Giordano, Halleran & Ciesla, JRCRUZ Corporation, Pumping Services, Union Paving & Construction, EIC Associates and HC Constructors. Approximately 100 members and guests participated in the event and the proceeds benefited the association’s scholarship program. This event raised $7000 for the scholarship fund. Due to the popularity of this activity, the association has scheduled a second sporting clay shooting event for October 29, 2013.

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Safety Perspective

By: Kevin Monaco Leading Edge

OSHA’s Hazard Communication Program & The Global Harmonized System: New Rules Take Effect Soon Exposure to hazardous chemicals is one of the most serious threats facing American workers today,” said U.S. Secretary of Labor Hilda Solis. “Revising OSHA’s Hazard Communication standard will improve the quality and consistency of hazard information, making it safer for workers to do their jobs and easier for employers to stay competitive.” In 2003, the United Nations (UN) adopted the Globally Harmonized System of Classification and Labeling of Chemicals (GHS). The GHS includes criteria for the classification of health, physical and environmental hazards, as well as specifying what information should be included on labels of hazardous chemicals as well as safety data sheets. The United States was an active participant in the development of the GHS, and is a member of the UN bodies established to maintain and coordinate implementation of the system. In May 2005, OSHA added to its regulatory agenda an advance notice of proposed rulemaking (ANPR) on September 12, 2006. OSHA then published a proposed rulemaking on September 30, 2009 to align OSHA’s Hazard Communication standard (HCS) with the GHS and the Final Rule became effective May 26, 2012. OSHA’s Hazard Communication Standard (HCS) is now aligned with the Globally Harmonized System of Classification and Labeling of Chemicals (GHS). This update to the HCS will provide a common and coherent approach to classifying chemicals and communicating hazard information on labels and safety data sheets. Once implemented, the revised standard will improve the quality and consistency of hazard information in the workplace, making it safer for workers by providing easily understandable information on appropriate handling and safe use of hazardous chemicals. This update will also help reduce trade barriers and result in productivity improvements for American businesses that regularly handle, store, and use hazardous chemicals while providing cost savings for American businesses that periodically update safety data sheets and labels for 80

chemicals covered under the hazard communication standard. In order to ensure chemical safety in the workplace, information about the identities and hazards of the chemicals must be available and understandable to workers. OSHA’s Hazard Communication Standard (HCS) requires the development and dissemination of information that Chemical manufacturers and importers are required to evaluate the hazards of the chemicals they produce or import, and prepare labels and safety data sheets to convey the hazard information to their downstream customers. It also requires that all employers with hazardous chemicals in their workplaces have labels and safety data sheets for their exposed workers, and train them to handle the chemicals appropriately. Currently many different countries have different systems for classification and labeling of chemical products. In addition, several different systems can exist even within the same country. This situation has been expensive for governments to regulate and enforce, costly for companies who have to comply with many different systems, and confusing for workers who need to understand the hazards of a chemical in order to work safely. GHS is a system that defines and classifies the hazards of chemical products, and communicates health and safety information on labels and material safety data sheets (now called Safety Data Sheets, or SDSs, in GHS). The main goal of GHS is that the same set of rules for classifying hazards, and the same format and content for labels and safety data sheets (SDS) will be used around the world. The major changes to the Hazard Communication Standard are the Hazard Classification, Labels, and Safety Data Sheets. Under Hazard Classification, the definitions of hazard have been changed to provide specific criteria for hazard classification of health and physical hazards, as well as classification of mixtures. These specific criteria will help to ensure that evaluations of hazardous effects are consistent across

manufacturers, and that labels and safety data sheets are more accurate as a result. For Labeling, chemical manufacturers and importers will be required to provide a label that includes a harmonized signal word, pictogram, and hazard statement for each hazard class and category. Precautionary statements must also be provided. Under the revised HCS, once the hazard classification is completed, the standard specifies what information is to be provided for each hazard class and category. Labels will require the following four [4] elements:

1. Pictogram: a symbol plus other graphic elements, such as a border, background pattern, or color that is intended to convey specific information about the hazards of a chemical. Each pictogram consists of a different symbol on a white background within a red square frame set on a point (i.e. a red diamond). There are nine pictograms under the GHS. However, only eight pictograms are required under the HCS. There are nine pictograms under the GHS to convey the health, physical and environmental hazards. The final Hazard Communication Standard (HCS) requires eight of these pictograms, the exception being the environmental pictogram, as environmental hazards are not within OSHA’s jurisdiction. 2. Signal words: a single word used to indicate the relative level of severity of hazard and alert the reader to a potential hazard on the label. The signal words used are “danger” and “warning.” “Danger” is used for the more severe hazards, while “warning” is used for less severe hazards. 3. Hazard Statement: a statement assigned to a hazard class and category that describes the nature of the hazard(s) of a chemical, including, where appropriate, the degree of hazard. 4. Precautionary Statement: a phrase that describes recommended measures to be Utility and Transportation Contractor, JUNE 2013

taken to minimize or prevent adverse effects resulting from exposure to a hazardous chemical, or improper storage or handling of a hazardous chemical. Employers may choose to label workplace containers either with the same label that would be on shipped containers for the chemical under the revised rule, or with label alternatives that meet the requirements for the standard. Alternative labeling systems such as the National Fire Protection Association (NFPA) 704 Hazard Rating and the Hazardous Material Information System (HMIS) are permitted for workplace containers. However, the information supplied on these labels must be consistent with the revised HCS, e.g., no conflicting hazard warnings or pictograms Under the revised HCS Material Safety Data Sheets will now be referred to as, “SAFETY DATA SHEETS”. SAFETY DATA SHEETS [SDS] will now have 16 sections in a set order, and minimum information is prescribed for each section. The format of the 16-section SDS is required to include the following sections: * Section 1. Identification * Section 2. Hazard(s) identification

Utility and Transportation Contractor, JUNE 2013

* Section 3. Composition/information on ingredients * Section 4. First-Aid measures * Section 5. Fire-fighting measures * Section 6. Accidental release measures * Section 7. Handling and storage * Section 8. Exposure controls/personal protection * Section 9. Physical and chemical properties * Section 10. Stability and reactivity * Section 11. Toxicological information * Section 12. Ecological information * Section 13. Disposal considerations * Section 14. Transport information * Section 15. Regulatory information * Section 16. Other information, including date of preparation or last revision The SDS must also contain Sections 1215, to be consistent with the United Nations’ Globally Harmonized System of Classification and Labeling of Chemicals (GHS). Although the headings for Sections 12-15 are mandatory, OSHA will not enforce the content of these four sections because these sections are within other agencies’ jurisdictions.

The first compliance date of the revised HCS is December 1, 2013, which will require employers to train their workers on the new label elements and the SDS format. OSHA is requiring this training early in the transition process since workers are already beginning to see the new labels and SDSs on the chemicals in their workplace. To ensure employees have the information they need to better protect themselves from chemical hazards in the workplace during the transition period, it is critical that employees understand the new label and SDS formats. For more information on OSHA’s revised Hazard Communication Standard AND THE Global Harmonized System, reference the following at OSHA’s website, [www.osha.gov] About the Author: Kevin Monaco is President of Leading Edge Safety & Health. The firm provides OSHA compliance solutions, safety, education and training programs, project safety inspections and handles OSHA administrative matters.

Utility and Transportation Contractor, JUNE 2013

ROAD & TRANSPORTATION MARKET OUTLOOK

By: ARTBA Chief Economist Alison Premo Black, Ph.D

Even With The Transportation Bill Funds, Only Modest Growth In Construction Is Expected The U.S. transportation construction infrastructure market is expected to show modest growth in 2013, increasing 3 percent, from $126.5 billion to $130.3 billion, according tothe American Road & Transportation Builder’s Association’s annual economic forecast, released in last November. Growth is expected in the areas of highway and street pavements, airport terminal and runway work, railroads, and port and waterway construction. The bridge market, which has shown substantial growth over the last 10 years, is predicted to remain flat this year. The Federal Surface Transportation program, along with state and local government transportation investments, arethe most significant drivers of the national transportation infrastructure construction market. MAP-21’s Impacts The pavements market will be sluggish in 2013, growing 2.8 percent to $58.4 billion. This includes $47.7 billion in public and private investment in highways, roads and streets, and $10.7 billion in largely private investments in parking lots, driveways and related structures. With no new federal funding in the 2012 MAP-21 surface transportation law, stillrecovering state and local tax collections and modest new housing starts, the pavements market will be uneven across the nation. Pavement work is anticipated to be down in 25 states. Growth above a 5 percent range is expected in 19 states. Major markets California and Texas will be down slightly from 2012, but will actually be returning to a normal baseline level because ofseveral major project awards over the past several years. At least two developments related to MAP-21 could lead to additional, short-termconstruction market activity in the sector and strengthen the market in 2013 and 2014. First, the law’s restructuring of the federal highway program offers state transportation departments more flexibility in their use of federal funds. This could result in slightly increased investment in highway, bridge and pavement work above the forecast in some states. Second, MAP21’s expanded federal Transportation Infrastructure Finance & Innovation Act (TIFIA) loan program could also boost construction activity. Also, while the economic costs of Hurricane Sandy are still being calculated, it’s fair to say that major reconstruction work along the East Coast in states affected by the storm will also be a market factor in 2013 across all modes. Additional federal, state and local emergency funds for rebuilding this infrastructure will be a boost as projects get underway. Bridges & Tunnels After a four-year run of significant market growth — reaching a record high $28.5 billion in 2012—the bridge and tunnel construction market will cool off in 2013, likely remaining flat at about $28.2 Utility and Transportation Contractor, JUNE 2013

billion. ARTBA’s forecast shows projects in eight states— California, Florida, Illinois, New Jersey, New York, Pennsylvania, Texas and Washington—will continue to account for about half of the U.S. market activity in this sector. With a number of major bridge projects on the horizon, however, the bridge and tunnel sector should rebound smartly in 2014. Ports & Waterways One very bright spot will be U.S. port and waterway construction, which will jump nearly 25 percent to $2.65 billion, driven largely by increased sea trade, which is expected with completion of the Panama Canal expansion project in 2015. Increased market activity is anticipated in California, Florida, Kentucky, Maryland, Massachusetts, Mississippi, New Jersey, New Hampshire, New York, Texas, Virginia and Washington. Airport Runways & Terminals Airport runway and terminal construction is expected to show growth in 28 states, with sector growth overall of 4.5 percent, reaching $12.5 billion. Market-driving states include: Alaska, Arizona, California, Florida, Illinois, New York, Ohio, Tennessee and Texas. Funding for airport projects is anticipated to increase over the next five years, largely tracking growth in passenger enplanements. Railroads, Light Rail & Subways The U.S. railroad construction market, driven largely by private investment in Class 1 freight tracks and structures, is expected to grow just under 5 percent in 2013, reaching $10.4 billion from $9.9 billion in 2012. The uncertainty caused by the 33-month delay in passage of MAP-21 will be felt in the subway and light rail markets. Construction activity is projected to be down by 8 percent. There will be some bright spots, however. Based on recent contract awards, these states will be moving forward on key transit projects: California, Florida, Georgia, Hawaii, Illinois, Kansas, Massachusetts, New York, Oregon, Pennsylvania, Texas and Washington. The overall subway and light rail market should rebound in 2014 with the federal funding certainty brought with enactment of MAP21. Wild Card The stalemate over the federal budget situation is another factor that could impact the market over the next few months, and it is unclear at this time if Congress will fund the highway and transit investment increases authorized last summer, or hold funding for these programs at the 2012 levels. Another issue is how state and local governments will deal with the federal budget sequestration, which went into effect March 1. While the federal highway, airport and non-capital transit Continued on Page 71 89

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Published on Jul 22, 2013

Utility & Transportation Contractor Magazine June 2013

Published on Jul 22, 2013

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