Author: buildingpa

On Tuesday, August 15, 2017, the Keystone Contractors Association partnered with the U.S. Green Building Council Central PA Chapter to provide the construction industry with a tour of the State College High School project currently under construction. The project consists of two buildings, around 660,000 SF of renovated and new construction, with costs estimated around $140 million.

Weather-wise, it was a perfect day to don the safety PPE and walk the jobsite. But first, the fifty-plus attendees sat through a very informative presentation given by Ed Poprik, State College School District; Jeff Straub, Crabtree Rohrbaugh Architects; and, Tim Jones, Massaro Construction Management Services.

The project’s owner, Mr. Poprik, kicked off the presentation. He provided a history of the school’s capital management, which dated well beyond the twenty years he has been at the school (in fact the week of the tour marked his 20^th anniversary that he has served as the District’s Director of Physical Plant). He discussed past projects of the district, the aged high school buildings, and the famous referendum vote that residents of the district passed in order for the massive project to proceed.

Next the project’s architect of record spoke. Mr. Straub discussed the referendum, and his firm’s role in the process in assisting the district in getting the community to first understand there was a need for the project and then to engage the community. He then proceeded to highlight some of the sustainable features on the project, as well as explain the LEED certification process. The school set the goal of at least a Silver LEED certification and with that in mind his firm designed to the Gold level to assure they at least reach Silver if by chance some points are not achieved. The project is on pace to receive Gold.

The final portion of the presentation prior to the tour was given by the construction manager, Tim Jones. We all know how important the Owner and Architect are on a construction project, but KCA is a contractor association so we’re going to focus on this portion of the presentation more.

Tim Jones is a senior project manager for Massaro Construction Management Services, a Pittsburgh-based company. Prior to the State College High School work, Massaro was the CM at Penn State University on a multi-year project in the PSU Henderson Health & Human Development Building. This award-winning HHD project consisted of 105,505 SF of new construction and 39,147 SF of renovation construction and the total project cost was a little over $43 million.

Timing of the PSU and State College High School projects were ideal for Mr. Jones to pick up roots in southwestern PA and relocate his family to the State College area. Additionally, the experience of two active educational buildings being constructed with Mr. Jones serving as the project manager was an excellent opportunity for the industry to hear his lessons learned concerning project phasing.

Before jumping right into the subject at hand, first let’s explain construction phasing. For numerous reasons a construction project may have to be broken down into smaller, separate manageable segments or phases. Some projects are phased due to financing and a phase may be completed as money is received from the lender. Another popular reason for phasing is to accommodate an Owner/User Group that still needs to function while the project is under construction. The latter reason was the case for the State College projects to be phased construction.

A college or high school cannot simply close its campus for a few years to complete a mega construction project. When phasing is needed, the General Contractor/ Construction Manager is relied upon to take the lead, and in the case of both the PSU HHD and State College High School projects, Mr. Jones was the point person from the CM firm. Here are some lessons learned from these two phased projects that he shared with the attendees at this week’s tour:

• User Group Point of Contact – A construction project, regardless of the size, can be a challenge coordinating all the various trade contractors, but the Owner needs to be included too in the project. And this challenge intensifies in a phased project as each phase is sort of a unique project in itself. In the case of an educational setting, there may be dozens of people who are considered the Owner/Client, from professors to administrative staffers to students. To effectively provide input in an efficient manner, it helps tremendously if there is one point of contact to speak on behalf of the User Group. This one User Group contact and the CM will communicate constantly during the duration of the project. Without one contact, the CM could find themselves in a position to receive contradicting input of what the Users need.
• Meeting Cycle – A consistent meeting schedule should be created and respected by project stakeholders. Constant communication is crucial on a phased construction project on an educational campus to allow for the construction team to understand what needs to happen to respect campus activities.
• Space Loss Planning– The project team doesn’t live in the spaces that they are trying to relocate or revise. Input from the User Group is critical to this but you need to be mindful that this can be a challenge. Approaching a construction project is stressful for the Users as most often they haven’t been through a significant project that effects their day-to-day responsibilities of educating. One lesson learned was that some of the existing building compression was too much for the Users to really work with. Part way through the construction phase the project needed to add some supplementary temporary trailer space to help accommodate. Owner’s need to carry contingency for phasing in the same way they carry contingency for construction challenges.
• Coordinate Commissioning & FFE – Building commissioning activities, as well as furniture, fixtures and equipment installation, are to be completed before handing a phased portion of the project over to the User Group. As you can imagine, on a phased project different portions of the same project will reach milestones at different times. These milestones must be communicated and tracked so the project will be ready for the commissioning and FFE stages. A smooth, coordinated process allows the User Group to get into the completed spaces when expected. On a phased project, the CM will be responsible for creating the schedule for moving the User Group around to allow for spaces to be renovated. If a space is completed, yet move in is not allowed due to mechanicals not being commissioned for example, it could have negative ramifications on other phases of the project and could potentially alter campus school schedules.
• Don’t Under Estimate Temporary Office Location – As mentioned, the User Group must continue operating while the project is ongoing. Educational spaces may be under construction and unable to serve the school, but setting up temporary locations can be a viable solution to keep the school operating. Depending on the project, setting up temporary locations can be the solution to keep a school operating.
• Summer is too Short – A common statement heard on a school construction project is: “Don’t worry about that now, we’ll do that over summer break.” Well, these summer activities can add up if you don’t keep a handle on this ‘do it over summer’ approach. The school could find itself behind schedule and delay the final move in date if too much work is transferred to summer.

The overall message that came across for a successful phased project is that communication is extremely important. Following this presentation, the attendees were given a lengthy, in-depth walking tour of the State College High School construction project. To view pictures visit: https://jonobrien.smugmug.com/State-College-HS-Project-Tour-E-/

In PA state government, the budget may have slowed down pieces of legislation, as the legislature has shifted its attention the past two months to completing the budget. But soon we’ll return to the issues, issues like the Separations Act. It may seem like an uphill, daunting task to repeal a century old law but in the words of Eliot Ness, “never stop fighting till the fight is won.”

PA still overpays for construction services so let’s do something about it. If you’re fine knowing that PA wastes tax dollars on public construction, then you’ll probably want to stop reading right now…. Still with us? Good, let’s proceed.

Earlier this year, Gov Wolf’s own guy, the DGS Secretary Topper, said he wanted to repeal the Separations Act. Great statement from a highly respected public procurement expert on all levels of government. How was this comment received? Supporters of a repeal of the Separations Act got excited, launched a petition, wrote OpEds, and worked with the legislature to propose repeal legislation. On the flip side, proponents of the status quo launched a barrage of lies to the governor’s office to support its cash-cow law (comments like: every small business will go under; PA will lose thousands upon thousands of construction jobs; etc.). BS days are over – the time to repeal is now, let’s make it happen this legislative session.

Concerned contractors and citizens of Pennsylvania launched an online petition (https://www.change.org/p/pennsylvania-repeal-pa-separations-act?source_location=minibar) to see who else wants to repeal this archaic law and save tax dollars. To date we accumulated a few signatures and gathered some great comments. But we can use more. Please take a moment to forward the petition to at least three of your contacts asking them to sign this petition. This petition will be presented to the legislature to assist in making this repeal happen. Plus at public hearings, we will share each and every comment that is posted on this petition.

Please do not hesitate to contact me to discuss the repeal plans or if you’d like to share ideas to add to the plan. Jon@KeystoneContractors.com.

Also, if contacting your State Senator and/or State Representative, please ask them to support Senate Bill 744 and House Bill 1529 by becoming a co-sponsor. If needed we have talking points for you to use.

Thanks for your support.

Every decade, the American Institute of Architects (AIA) update their construction contract forms for commercial projects. In April of this year, AIA released the latest version.

The previous release, in 2007, resulted in some construction stakeholders to jump out of their seats as many clauses within the contracts were sources of contention, seen by some to be anti-collaborative and placing too much power in the hands of the Architects, yet little risk seemed to go in the direction of the Architect. Because of the 2007 release, other contract forms picked up some marketshare in the contracts arena, modest gains, but gains nonetheless. Perhaps the biggest growth came from the ConsensusDOCS family of documents (which I’ll write about soon). Also, as a result of the 2007 AIA forms, many industry groups across the country documented their issues with the contracts and sent them to AIA to go on the record.

I was part of one industry group that spent a few years (circa 2010 to 2013) debating the AIA contracts. The group was the AIA-MBA Joint Committee. The Joint Committee is an industry group that meets monthly to discuss industry trends and problems, and hopefully from the discussion this group can draft recommendations to improve the construction industry. Concerning the AIA 2007 contract documents, we authored recommended amendments to the 2007 AIA A201 General Conditions. We published this paper on October 15, 2013. Our publication focused on four provisions within the 2007 A201 that we felt needed to be amended for the betterment of the industry.

This AIA-MBA Joint Committee publication was unique in that it was a document created by a task force within this committee that consisted of Contractors, Architects, Owners, and Attorneys. Most of the publications on the AIA contracts that I read were written in a ‘silo’, authored by Contractors or Attorneys or Owners or Architects – but this effort was a collaborative one involving major stakeholders.

Now let’s look at the four provisions that the AIA-MBA Joint Committee recommended to change, and let’s see how these provisions appear in the 2017 A201 version:

• § 2.2 INFORMATION AND SERVICES REQUIRED OF THE OWNER

Due to the financial crisis that doomed the economy during the past decade, the AIA-MBA Joint Committee’s 2013 publication thought a more assertive response was needed concerning an Owner responding to a request to furnish financial information. Back then we recommended using ‘shall’ instead of ‘may’ as one step in the right direction. In the 2017 A201 version, the word ‘shall’ was inserted, plus the updated General Conditions have more comprehensive requirements regarding the Owner’s duty to provide the Contractor with the information concerning its ability to pay, and have provisions allowing a Contractor to refuse to proceed with the work or to suspend work if such information is not provided.

In all honesty, while it may appear the Joint Committee was correct with this recommendation and the AIA wisely conformed to the same logic, one must consider the timing from both groups. The AIA released its 2007 revisions prior to the economic collapse and the Pittsburgh group responded after the collapse as the construction industry was digging out of the recession, a time when financials were extremely important.

• § 3.10 CONTRACTOR’S CONSTRUCTION SCHEDULE

The recommendation to the 2007 A201 was that upon contract award a Contractor should submit a schedule for all work that falls under a project’s critical path; instead of a complete and comprehensive submittal schedule.

In the 2017 A201 release, the AIA responds by stating a Contractor submit a schedule for the Owner’s and Architect’s information; wherein the previous version intended to submit a schedule to be approved by the Architect. Additionally, the newest version states the schedule shall focus on big ticket items – commencement of work; milestone dates; substantial completion; apportionment of work by construction activity; etc. And the schedule shall provide for the orderly progression of the work to completion. By including the Owner in this informational sharing exercise, the AIA demonstrates the collaborative spirit that the industry needs.

•    § 4.2 ADMINISTRATION OF THE CONTRACT

For this provision, the Joint Committee did not recommend language change; however, they did want to stress a collaborative approach to a project while abiding by the communication protocols. The 2007 version encouraged communication, but only through the Architect and the recommendation also encourages communication, but direct communication (i.e. Contractor to Owner, Contractor to Architect, etc.).

In the 2017 A201, the AIA improves this provision by authorizing direct communication between the Owner and the Contractor, as opposed to the two stakeholders communicating through he Architect.

• § 9.5.3 DECISIONS TO WITHHOLD CERTIFICATION

A provision in this section was added to the 2007 revisions to the A201 to address the situation where a Contractor has failed to make payment to Subcontractor(s). The intention for this addition a decade ago was to give the Owner an alternative to withholding payment of an entire payment application. AIA viewed it as a way to give an Owner flexibility in avoiding the need to withhold an entire payment, allowing some work to be paid for and enabling the Owner to issue a joint check to the Subcontractor that was not paid. Since there are various reasons why a Contractor may be withholding payment to a Subcontractor (faulty work, non-payment to a Supplier from the Subcontractor, etc.), allowing Owners to issue joint checks prevents the Contractor from adjusting the amount paid to a Subcontractor and it takes away the Contractor’s leverage, putting them in an all or nothing situation – either sign the joint check over to the Subcontractor or to not pay them at all.

The 2017 revisions addressed the industry’s concern in this matter by inserting the Contractor in the process, instead of the Architect. Now if the Owner makes payments by joint check, the Owner shall notify the Architect and the Contractor (No longer the Architect) shall reflect such payment on its next application of payment.

• § 9.6 PROGRESS PAYMENTS

This section was drastically modified in the 2007 update. In the Joint Committee’s commentary on proposed recommended changes, they kept the language the same. But they added caution to any provision that allows for stakeholders without a contract with each other from directly communicating with each other – in this instance it allows an Owner to circumvent a Contractor and directly communicate with a Subcontractor. This sort of communication has potential for a Subcontractor receiving direction from an Owner that could be different information from what they receive from a Contractor. This sort of unorganized process could add costs, delays, deficiencies, problems, etc. to a project.

In the 2017 revisions, for the most part this section remains unchanged, but there is an emphasis to include the Supplier anyplace the Subcontractor is mentioned. Like the previous warning, caution should be used when stakeholders without a contract communicate with each other, and now this expands as it includes both Subcontractors and Suppliers.

Well, that’s a quick glance at a few of the provisions in the AIA A201 2017 General Conditions that were dissected under the microscope by the AIA-MBA Joint Committee. The KCA is still thoroughly reviewing the updated AIA contract forms. Keep an eye for some education on this topic. In the meantime, remember I’m a phone call away if you have construction contract questions.

When I talk to my construction friends in Pittsburgh, Philadelphia, State College, and other cities across the Commonwealth, I hear about all the activity and major projects in these areas. Don’t get me wrong the Harrisburg, central Pennsylvania region, has had a decent construction market, but we were lacking in the mega projects department. So it’s welcoming news to hear that the federal government is proceeding with its courthouse project in Harrisburg.

The U.S. General Services Administration (GSA) is proceeding with its plan to build a new U.S. Courthouse at 6th and Reily Streets in Harrisburg. This 243,000 square-foot courthouse is budgeted for around $200 million. In January 2017, the GSA awarded an architectural and engineering services contract to Ennead Architects of New York. Then in March of this year, the GSA awarded Hill International of Philadelphia with a Construction Manager-as-Agent contract (Owner’s Representative).

Around a dozen General Contractors submitted qualifications for the Guaranteed Maximum Price (GMP) contract. The proposals were ranked and the top ranked/shortlisted firms are proceeding with their GMP submission. It is hopeful that the Contractor will be selected in the next few months. The design team will continue working on the drawings the rest of this year, into next year, and then activity should commence in Spring/Summer of 2018.

This project received the boost needed to proceed earlier this year from the KCA’s recent Leadership Series speaker Congressman Barletta, who announced that this project secured the authorization for $194.4 million to cover the new construction project. At the time of the authorization news, Barletta said: “This has been a long time coming, with various baby steps along the way, but now the Harrisburg courthouse will finally become a reality.”

This Courthouse is needed in Harrisburg because the existing Ronald Reagan Federal Building & Courthouse does not meet the federal government’s security and expansion requirements.  Per the GSA’s report, the 1960s Reagan Building was initially built with two courtrooms and later, two more courtrooms were added. Despite the addition, the four courtrooms are not enough to accommodate the increasing caseload of U.S. District Court for the Middle District of Pennsylvania in Harrisburg.

This new Courthouse will contain as many as eight courtrooms, including three for district judges, two for senior district judges, two for magistrate judges, and one for bankruptcy judges. Plus this project will include 43 parking spaces.

From this project, it is hopeful that construction activity will pick up around the Courthouse’s proximity. When it comes to the large mega projects, it’s almost like saying to the industry: “if you build it, they will come” and spin-off activity increases to build up the area around these economic drivers.

Later this year the KCA will host an informational session on this project with the GSA and other entities associated with the project. Stay tuned.

NOTE: Earlier this Spring, this article appeared in the Central Penn Business Journal. This week a few people have asked about the Pennsylvania State Construction Notices Directory (the online Lien site) so I updated the article:

A little over a decade ago, I found myself working with numerous construction trade associations to improve legislation regarding the lien process in Pennsylvania.  As a team, we were successful in prohibiting owners from enforcing ‘no-lien’ agreements.  However, this amendment to the Mechanic’s Lien Law that went into effect in 2007 was not perfect; as a result, surprise liens were popping up from second tier subcontractors and suppliers.

Since there was a major issue in the lien process, I found myself working with the same team of associations again to improve the lien process yet again. This time, when January 1^st rolled around, we welcomed a new year and the Pennsylvania construction industry welcomed a new, voluntary procedure concerning the way the industry operates under the Mechanic’s Lien Law. I am referring to the creation of the Pennsylvania State Construction Notices Directory (Directory). The Directory is located at https://apps.pa.gov/scnd.

Created by the State’s Department of General Services, the Directory allows owners of construction projects to use it for non-residential construction projects over $1,500,000. This Directory is an excellent way for owners, general contractors, subcontractors, and suppliers to know each and every entity associated with a construction project.

“It might be too early to have an opinion on this new state-run website, but it is easy to use and the intention of it is good. I think it’s a great idea for a supplier to have our name in front of the owner and general contractor since a lot of the times a subcontractor hires us and others might not know we are even on the project,” said Bonnie Patterson, Credit Manager for York Building Products.

The Directory works like this: an owner, or an agent of the owner, files a Notice of Commencement for $72 (this is the only fee associated with this website) on the online database for their construction project. This filing creates a project in the Directory and then within forty-five days of first performing work or supplying materials, a subcontractor and supplier must file a Notice of Furnishing (NOF). If this NOF is not filed within the allotted time, the entity associated with the project forfeits its Mechanic’s Lien rights.

Then forty-five days after completion of work, the owner may file a Notice of Completion in the Directory. After the owner makes this filing, any subcontractor or supplier who has not received full payment may file a Notice of Nonpayment. These two notices are not mandatory. These new lien provisions are intended to create a more structured and transparent procedure through an Internet database that is easily searchable.

Theoretically, this online repository can allow owners and general contractors to check and see all the firms that are working on a project and to make sure each of these firms are being paid. By using this website, an owner potentially can eliminate the risk of a surprise lien. Now that’s theoretically, it may be too earlier to determine if it’s working as designed, but despite being less than a year old the Directory is being used.

There are currently 100 projects in the Directory from across the Commonwealth. As one may expect, the most use of the Directory is happening in the southeastern and southwestern counties since both Philadelphia and Pittsburgh are economic drivers in Pennsylvania. But the Commonwealth is represented with projects in areas like Lackawanna County in the northeast to Cumberland and Dauphin Counties in the center part of the state to Butler County in the west. And while it is being used, it is even being used by the lower tiers on a construction project, which is great news! A major issue for the first three to four months of use was the lack of knowledge of the Directory to the subcontractors and suppliers associated with a project.

“The owner required us to file the Notice of Commencement [on his behalf]. I found it very user friendly and I had no issues since I had all of the information readily available to me,” said Alec Hanley, Project Engineer, Rycon Construction based in Pittsburgh, PA. “It appears that the biggest learning curve will be with subcontractors. We have started to include language in our general scope of work that describes the procedures for filing a Notice of Furnishing and their liens associated with following this process as well as including the Notice of Commencement as an Exhibit to our contract. We’ve also continued to provide courtesy reminders that it is their sole advantage to file a Notice of Furnishing and I’ve had low rate of return.”

However, it appears as though not every general contractor is being proactive to raise the awareness of the Directory. “I found out about this [Directory] from industry trade groups. Had I not gone to a few seminars our company would have had no idea this even exists,” said Bonnie Patterson of York Building Products. “As a material supplier, the information does not always make it to us. Plus, we might be contracted to supply material to a project before the project is even listed in the Directory. I have a system now where I log onto the Directory and compare the new projects that have been added against the projects we are on.”

With this new online process, the Keystone Contractors Association is not only providing educational seminars on it, we are also encouraging all construction companies to be proactive and diligent in protecting their lien rights.

Today, Monday, July 17, 2017, the Keystone Contractors Association launched the KCA Leadership Series. This ongoing dialogue features established and respected leaders. There are many ways to hone one’s leadership skills – you could find a mentor or join a peer group or take a course – but another way is to hear a leader in action. By listening to a leader, one could improve their leadership skills by listening to the passion, resolve and wisdom.

The KCA audience heard it all from its inaugural speaker Congressman Lou Barletta, and we even heard a little baseball too.

 (Caption: Congressman Barletta with hometown friend and KCA Board Member David Miorelli)

The event kicked off with a special introduction of today’s keynote speaker delivered by State Senator Mike Regan. Right away the audience knew they were in for something special by having a highly respected leader in Senator Regan introducing Congressman Barletta.

When on the stage, the Congressman did not disappoint. The journey he took everyone on was a remarkable one that we all enjoyed learning about. From his days growing up in Hazelton to playing baseball in the Cincinnati Reds farm system to starting his own pavement marking company (with only $29 in his pocket), it truly is a good success story. After years of running his own business, he found himself disagreeing with elected officials so he decided to do something about it and he ran for an elected position.

After successfully leading the city of Hazelton as its mayor, he wanted to have a bigger voice and ran for congress. He jokingly stated that the third time was a charm and he won the congress seat on the third try. But joking aside, the audience could tell that he was determined, even when things don’t go as planned he stayed the course.

When discussing his role as a U.S. Congressman, you could feel the passion in the room that he has for his country. He touched on a wide variety of issues like Public-Private Partnerships for transportation and building projects; infrastructure funding; wasteful government spending; workforce development strategies; and opioid addiction. He stayed until every question was answered.

When the KCA set out to create this KCA Leadership Series, we wanted to feature speakers that could entertain a room full of construction professionals for an hour or so. But what we got today was so much more – we got a leader who inspired the room full of construction professionals. Maybe it’s good he couldn’t hit a curveball since he’s doing such a great job in Congress.

Today, Congressman Barletta set the standard of what the central PA construction industry expects for future speakers in the KCA Leadership Series. Stay tuned to see who we get next….

To view pictures from today visit: https://jonobrien.smugmug.com/KCA-Leadership-Series-o-Congress/

This is my very first post. With this blog, we hope to cover the construction industry issues that are important to the AEC industry in Pennsylvania. While the Keystone Contractors Association cover most of the state, we may not be in the know on all issues. If you’d like to guest write, please let me know. You can either email me (Jon@KeystoneContractors.com) or call the KCA (717.731.6272). I’ll be sure to promote you and/or your company to make it worth your while for contributing something.