Career Opportunities, Rapid Advancement Are Keys to Attract, Replenish Workforce
By JOHN JORDAN – October 27, 2021
TARRYTOWN, NY — While contractors in the New York metro region report they have at the moment enough qualified workers to meet today’s infrastructure and private development needs, the aging workforce in the building trades coupled with a projected 12% job growth in the sector over the next decade are rising concerns for employers anticipating future staffing demands.
Then there’s the likely surge of major federal, regional and state projects now in the pipeline that will require even more skilled workers. Among them are the Portal Bridge/Gateway Tunnel project linking New York City and New Jersey; the expansion of Route 17 to interstate standards in Orange and Sullivan counties; the MTA’s Penn Station Access project; Regeneron Pharmaceutical’s more than $1-billion expansion in Westchester County; and a possible expansion of the Empire Resorts Casino in Yonkers when downstate casinos are approved by New York State.
Three other sources from Washington that are likely to lift construction sector job growth include the reauthorization of the multi-year FAST Act federal transportation bill, a new $1-trillion bipartisan infrastructure bill for highways and bridges that awaits a final vote in the Congress, and the “Build-Back-Better” soft infrastructure bill now being negotiated.
Given these many employment percolators, it’s time to ask, “Where will the workforce of tomorrow come from to fill the boots of the rank and file?” Massive infrastructure renewal and its concomitant employment demands do not bode well with a workforce that’s aging. The Brookings Institute reports that the
median age of construction and building inspectors is 53. The average age for all construction workers nationwide is 42.5. Only 10% of construction workers are under 25.
To better understand these industry challenges, a seminar entitled “Future Workforce Development” was held Wed., Oct. 13 in Tarrytown, to provide insight and perspective on construction workforce trends. The program was held prior to the General Membership Meeting of the Construction Industry Council and the Building Contractors Association at the Westchester Marriott Hotel here. The event also featured Federal Reserve Bank Economist Jason Bram who provided detailed statistics on key labor trends affecting the economy and construction industry.
Erin Vitale, CPC, chair of Civil Engineering Technology at Alfred State College and the seminar’s keynote speaker and moderator, explained that industry demands are changing and the education model must also adapt. College students can learn all aspects of the trades, including construction management, that will all lead to high-paying jobs upon graduation, she said. In fact, Alfred College also has articulation agreements with Clarkson and Syracuse universities to allow students to continue with their education to earn their MBAs.
“No longer is going to college to study the trades a dead-end educational proposition,” she said. “People can go on as far as they want in their career.”
The Workforce Development Seminar panel also featured Craig R. Clark, vice president of economic development at Alfred State College and executive director of the Allegany County Industrial Development Agency. In addition, James Smith, president and founder of Advance Testing Co., and Gary Hill, president of Union Concrete Construction Co., served as industry panelists, offering their personal perspectives as employers and company owners.
Ms. Vitale noted that the college’s new Bachelor of Arts program for Construction Management currently has approximately 50 students from all over the country. The college also offers a Bachelor’s program in Architecture as well as a Bachelor of Science and Associate’s Degree programs in Architectural Technology along with a five-year B-Arch program and other construction-industry related disciplines, including surveying and technology programs.
Ms. Vitale said that there are not enough graduates to meet the demand from the construction industry for highly trained, college-educated workers and management. In fact, she said that some firms are contacting freshman students to offer them positions with their firms “practically on the spot” or immediately after graduation.
She noted that the industry needs to do a better job marketing careers in construction along with the high-paying jobs it offers for entry-level workers. She stressed that the great careers as construction managers will be there waiting and available, with the proper training and experience, for the nation’s youth coming out of high school.
“Our industry definitely needs some sort of major upheaval,” Ms. Vitale said. Pointing to popular TV shows like ER, LA Law and CSI—all responsible for upticks in school enrollments in medicine, the law and criminology—she added, “Maybe somebody knows a Hollywood producer, but barring a construction (TV) drama, we need to bring in more kids to our program.” Grassroots marketing and education are key, she stressed.
Celeste Frye, co-founder & CEO of Public Works Partners, LLC, a WBE/DBE/SBE-certified planning and consulting firm based in New York City, who was interviewed by CONSTRUCTION NEWS earlier, remarked after the presentations and comments that nationwide there is a workforce shortage in many industries, including construction. She agreed with Ms. Vitale that the industry must use new means to recruit more younger workers, including those from underserved communities.
She said that one of the industry’s more attractive recruiting pitches is the sector’s opportunity for advancement. Ms. Frye noted that in addition to high-paying, entry-level positions, the industry also offers well-paid positions in construction and project management posts.
“It’s true that construction is a multi-generational industry,” Ms. Frye added. “Many people go into construction the same way they go into first-responder jobs, because they have family members in the industry. I think expanding that (recruitment) to new populations is going to take marketing because if you don’t have family in construction, you don’t know the range of jobs.”
Gary Hill, president of Union Concrete Construction Co. of West Seneca, NY, said that the construction industry requires a well-educated and diversified workforce. He noted that the recent trend with New York State Department of Transportation projects has been that DOT is letting more jobs but that these projects are much smaller in scope. Therefore, his firm and others in Western New York are working on a host of small NYS DOT projects at once, which requires its workers and managers to have multiple responsibilities.
Mr. Smith of Advanced Testing said that there are plenty of opportunities in the construction materials testing industry that also offer high-paying positions for qualified applicants.
Mr. Smith and Mr. Hill are both 1977 graduates of Alfred University’s construction engineering technology program. All of the speakers promoted the planned state-of-the-art ‘Doc’ Bruce Construction Materials Laboratory at Alfred. A fundraising effort is underway to raise $500,000 for the lab, and Mr. Smith reported the campaign has raised $270,000 so far.
Donations by check can be made payable to: “Alfred State College Department Fund, Inc.,” a 501(C)(3) charitable entity. Mail your gift to Alfred State/A Office-10 Upper College Drive, Alfred, NU 14802. You can also make a gift online at AlfredState.edu.give.
State Gaming Commission Issues RFI For Three Downstate Casino Projects
By JOHN JORDAN – October 27, 2021
ALBANY — The New York State Gaming Commission has issued a Request for Information from interested parties for either developing or operating three downstate New York casinos in the New York metro region, which can only be viewed as good news for advocates of downstate casinos.
The RFI issued by the Gaming Commission on Oct. 20 states, “Respondents to this RFI should not anticipate award of a contract; this is an information gathering process only. This RFI is for planning purposes only and should not be interpreted as a solicitation for bids on the part of the State or the Commission.” Four upstate casino licenses have already been awarded by New York State, including the Resorts World Catskills Casino in Monticello, NY, which is owned and operated by Genting.
The issuance of the RFI follows the release of a report detailing the impacts of downstate casino gaming and mobile sports betting by Spectrum Gaming
Group in January 2021. The report found downstate counties show the greatest potential for growth in Gross Gaming Revenue, ranging from $970 million to $4.49 billion for New York City, and $606 million to $1.13 billion for Long Island. The potential of the New York City market could be captured by the addition of new gaming facilities, the report stated.
The Gaming Commission has set a deadline for the submission of questions concerning the RFI for Nov. 10, 2021 and for a submission to the RFI by Dec. 10, 2021. The New York State Gaming Commission per state statute has to prepare and distribute a report on the RFI to the governor and the State Legislature no later than six months from the Dec. 10, 2021 deadline. The statute was passed by the State Legislature and signed by then Gov. Andrew Cuomo in April 2021.
If the process does move forward, it could be assumed that a Request for Proposals could be issued in mid-2022 and an award sometime thereafter. It should be noted that the state’s gaming law bans the award of downstate casino licenses until 2023. The measure was intended to allow the upstate casinos to establish a client base before they faced competition from downstate facilities.
The three casino licenses would be awarded to applicants in Zone 1, which consists of New York City and the counties of Nassau, Putnam, Rockland, Suffolk and Westchester. Based on the submittals, the Gaming Commission is seeking to determine the appropriate size and scope of development, the value of the gaming facility license and the process that should be used in the award consideration.
Frontrunners for the downstate licenses, should the process move forward, include two existing gaming facilities—the Genting-operated Resorts World New York City at Aqueduct Racetrack in Queens, as well as the MGM Resorts-owned Empire City Casino in Yonkers. Both facilities are Video Lottery Terminal gaming facilities and are not full-fledged casinos. Genting is also moving forward on another VLT facility in the City of Newburgh in approximately 90,000 square feet of space at the Newburgh Mall.
The New York Post has reported that Bally’s Corp., Wynn Resorts, and Las Vegas Sands are all expected to compete for a New York City-area casino license.
Former Gov. Andrew Cuomo in his State of the State address in January reported that he intended to issue a Request for Information for interested parties in securing up to three of the remaining casino gaming licenses in Downstate New York (New York City metro region) to be granted by New York State. However, the State Gaming Commission at the time had no comment on the governor’s statement.
A group of 60 business and labor organizations called “A Sure Bet for New York’s Future” lobbied state lawmakers earlier this year to have the downstate gaming award process move forward and award one of the casino licenses to the Empire City Casino in Yonkers.
The granting of a full gaming license to Empire City could fuel significant economic growth and jobs to the region. A spokesperson for Empire City Casino told CONSTRUCTION NEWS earlier this year that if awarded a full gaming license and sports betting access, Empire City Casino owner MGM Resorts has committed to spend approximately $400 million in the first phase of its planned investment at the Yonkers property.
Environmental Review of $1.6 Billion Penn Station Access Project Completed
NEW YORK — The Metropolitan Transportation Authority announced on Sept. 27 that the environmental review process for the Metro-North Penn Station Access Project is complete.
The milestone makes four new stations in the Bronx as well as direct Metro-North service to Penn Station from the Bronx, Westchester, and Connecticut a step closer to reality. On Sept. 24, 2021, the Federal Transit Administration issued a formal Finding of No Significant Impact (FONSI) in accordance with the National Environmental Policy Act (NEPA), marking the conclusion of the environmental review.
“This is an important milestone for a project that will give people in several transit-deprived areas of the East Bronx access to jobs, education, health care and everything New York and Connecticut have to offer,” said Acting MTA
Chair and CEO Janno Lieber. “By making use of existing infrastructure, we are connecting people to these opportunities at a fraction of the cost it would take to build a new rail line. The next step is to award a contract to one team that will manage both the design and construction in a coordinated way to deliver the project on time and on budget.”
“This project will be game-changing for Metro-North,” said Catherine Rinaldi, president of MTA Metro-North Railroad. “In essentially one bold stroke it will allow the railroad to dramatically reduce travel times for a transit desert with a vast population of hundreds of thousands of people, and it will allow our busiest line to have a second destination in midtown Manhattan. We are already looking forward to opening day.”
The project will bolster equity, regional connectivity and resiliency by delivering a new transit option for residents and workers in the East Bronx with four new fully accessible Metro-North stations, at Co-Op City, Parkchester, Morris Park and Hunts Point. The advent of train service to these stations will support the local economy and attract regional talent by increasing accessibility to underserved neighborhoods, cutting commutes, and introducing reverse commuting opportunities, MTA officials stated.
The project will use Amtrak’s existing Hell Gate Line to access Penn Station, maximizing the potential of existing infrastructure, while minimizing impacts on the surrounding community. It will bring the Hell Gate Line into a state of good repair and improve resiliency and on-time performance for Amtrak passengers. The project also calls for the construction of new electrical substations, additional tracks within the existing line, work to renew bridges and upgrades to Metro-North’s New Rochelle Yard.
The MTA reported that procurement is underway to award a design-build contract to construct the Penn Access project which will dramatically reduce travel times for people traveling to or from the East Bronx. The project is estimated to cost $1.6 billion.
Federal, state and county officials were in agreement that the project will be transformative for the region.
“Today is a great day for the future of mass transit access in the South and East Bronx and the Westchester Sound communities,” said U.S. Sen. Charles E. Schumer. “The FTA has completed its environmental review of the Penn Access project, a critical step for MTA to advance to construction of the project connecting Metro-North with Penn Station, including new mass transit stops in the South and East Bronx—and direct connection to Penn Station for parts of Westchester. I will continue to advocate for advancing this project and will push for federal grants key to its completion.”
“As New Yorkers get back to work and we rebuild our economy, we must expand critical access to safe and affordable public transportation for everyone,” said Sen. Kirsten Gillibrand. “I am pleased to see this project move forward—it puts us one step closer to reducing travel times for countless Bronxites who rely on Metro-North to get where they need to go.”
“The completion of the environmental review is a great step forward for the Metro-North Penn Station Access Project,” said Bronx Borough President Ruben Diaz Jr. “For nearly a decade, I have been beating the drum on direct access to Penn Station from the Bronx, and now, this form of transportation in the East Bronx is one step closer to becoming a reality.”
“The completion of the environmental review for Metro-North Penn Station Access means we are one step closer towards completing a project that will be life changing for Westchester residents who live along the Sound Shore and commute to the Bronx or parts of Manhattan for work,” said Westchester County Executive George Latimer. “For the first time ever we will be able to create a one-seat ride into Penn Station, opening up greater access to jobs, education and health care, all while improving the commute and making these communities more desirable to live in. I thank the MTA for their hard work on this—we cannot wait to see this project come to fruition.”
County Exec. Latimer Proposes $476M Capital Budget Plan for ’22
WHITE PLAINS — Westchester County Executive George Latimer unveiled a $476-million capital budget plan on Oct.14 that includes $50 million for the funding of affordable housing projects in Westchester County and millions for wastewater treatment facility upgrades.
The proposal, now before the Westchester County Board of Legislators, also includes funding for roads, bridges, wastewater treatment plants and county parks.
Among the more notable items is $4 million in funding to explore the future use of the Westchester County Center, which hasn’t been used for recreation or events since the COVID-19 pandemic began last year.
The fourth proposed Capital Budget of his administration also earmarks investments in hybrid and electric vehicles, and recreational facilities such as Playland, Memorial Field, and the completion of a continuous Bronx River Pathway from New York City to Kensico Dam Plaza.
This budget proposal requests $476.4 million in new appropriations on an all funds basis for 2022. This appropriations request breaks down as follows: $291.9 million for general county purposes; $152.4 million for the sewer and water districts; $4.1 million for the refuse district; and $28.0 million for Westchester County Airport.
Mr. Latimer said of the Capital Budget proposal, “Over the past four years we have made significant investments in our county’s infrastructure, while maximizing efficiencies to reduce costs, improved the county’s bond rating, and we have done all of this while cutting county property taxes for our residents.”
Year-to-date the county has expended more than $119 million on capital improvements. The backlog of capital projects has also been reduced by $400 million since Latimer took office in 2018. Over the past three years, Latimer’s Administration has made great strides to improve the capital program and increase efficiency. Administration officials pointed to the approval by the New York State Legislature, at the county’s request, to eliminate the $10-million bond referendum cap, as one of the administration’s most notable accomplishments. The lifting of the bond referendum cap ultimately saves the county money by eliminating extra costs from breaking up projects unnecessarily into pieces, county officials stated.
Westchester County Budget Director Lawrence Soule said, “We have made progress toward improving the county’s Credit Ratings while continuing to invest in our infrastructure. Fitch Ratings recently removed the negative outlook (current rating AA+ Stable) on the county’s general obligation bonds citing the county’s strong underlying revenue growth potential and significant ability to implement policy decisions that would close budget gaps and maintain very high financial resilience. They further state that the revision from negative to stable reflects their expectations that the county will maintain its improved financial resilience over time based on recent operating results that have bolstered general fund reserves. An improved credit rating has the positive effect of lowering the county’s borrowing cost for capital projects.”
“The 2022 Capital Budget proposed by Westchester County Executive Latimer is another significant step in his administration’s commitment to protecting and advancing the health, safety and mobility now enjoyed by the residents and the business and cultural enterprises that make Westchester their home,” said John Cooney, Jr., executive director of the Construction Industry Council of Westchester & Hudson Valley, Inc. “The CIC applauds Mr. Latimer and his team for its plan to allocate $476 million for capital projects that include roads and bridges, water and sewer infrastructure, the county airport and other county-owned facilities and attractions.”
Mr. Cooney added, “Investment in our public works systems has long proven to be the leading force to create jobs and stimulate the economy. As we return to healthier and safer times, Westchester County government now has a great opportunity to reduce the lengthy backlog of needed infrastructure work projects. This budget proposal is both fiscally responsible and responsive to our immediate needs, and CIC calls upon the members of the County Board of Legislators to make this capital spending plan a top priority in the overall county budget for 2022.”
Under the 2022 proposed Capital Budget, over 2,000 permanent jobs will continue to be supported in the county. Latimer said none of these strides would be possible without our partners in the construction industry.
Major improvements are planned for the Mamaroneck and Yonkers wastewater recovery facilities in 2022. $37.5 million is included for Mamaroneck for a variety of improvements including nitrogen and phosphorus removal to protect the Long Island Sound, emergency power systems and odor control. At Yonkers, $22.6 million is included primarily for additional odor control measures and the completion of the methane recapture project that will allow the facility to generate approximately 70% of its energy needs.
Westchester County Airport
The Westchester County Airport is also included in the proposed Capital Budget with $28 million in new appropriations for improvements to the potable and fire suppression water systems to ensure the health and safety of all employees and patrons at the facility.
A total of combined $50 million is budgeted for land acquisition and infrastructure improvements to support the development of affordable housing within the county. If approved by the Westchester County Board of Legislators, the 2022 Capital Budget would represent the largest single year commitment to affordable housing in county history.
Westchester County Planning Commissioner Norma Drummond said, “The county’s contribution to affordable housing helps to create strong communities where members of the workforce and community volunteers can live. We need to be able to house those that provide the services that contribute to our great quality of life all across the county.”
The Building & Realty Institute of Westchester of Armonk praised the Latimer administration’s investment in housing. The BRI stated that it hopes that the capital budget proposal will be swiftly approved by the Board of Legislators “as it presents affordable housing as a top priority for funding and will solidfy the county’s commitment to the housing issue.”
Tim Foley, CEO & Executive Vice President of the BRI, said, “On behalf of the Welcome Home Westchester campaign, we applaud County Executive Latimer’s proposals in the 2022 Proposed Capital budget to support land acquisition and infrastructure improvements to help make it easier to develop new affordable housing throughout the county. The need for housing throughout our communities is critical, and the level of investment proposed by the County Executive Latimer rises to meet that challenge with the largest single-year investment in affordable housing. This $50-million investment would be spread across a few programs with proven track records in supporting development costs, improving things like roads, water and storm sewer improvements, and other areas that make it safe and cost-effective.”
Westchester County Parks
Westchester County Parks saw unprecedented demand during the pandemic and the County Executive has continued his commitment to improve and enhance this vital county resource, county officials stated, The County Executive’s proposal also includes $4 million to begin the process of re-imagining the Westchester County Center. The County Center has not had a major improvement since the 1980s, and an examination of the entertainment space is needed especially in light of the COVID-19 pandemic.
Within the Westchester County Parks System, a combined $45 million has been allocated for structural improvements to the Ice Casino at Playland and Playland Amusement Park.
The County Executive has earmarked: $31.9 million in appropriations for the purchase of electric hybrid buses for the county’s Bee-Line Bus System; $4.3 million to begin the process of electrifying the county’s two bus garages; $1 million for the installation of EV charging stations at county facilities; and $1.1 million for improvements at Hilltop Hanover Environmental Center.
The Westchester County Board of Legislators has received the proposed Capital Budget and will in the near future be given the proposed Operating Budget. The Board of Legislators are charged with passing the county budget by the end of December 2021.
Existence of a Valid Contract Dooms Unjust Enrichment Claim
By THOMAS H. WELBY, P.E., ESQ. and GREGORY J. SPAUN, ESQ.
Unjust enrichment is a legal theory of recovery holding that no person should be allowed to unfairly profit at another’s expense without making restitution or compensation to that person. The concept of unjust enrichment is often used in construction litigation as an alternative to breach of contract when a contract turns out to be invalid, or when there is no adequate remedy at law. However, as we can see from the recent case of KST2 Properties, LLC v Pretree Construction Co, one must be careful in how to assert the claim because the existence of a valid contract will doom the unjust enrichment claim.
In August 2017, Pretree Construction Co. was retained by KST2 Properties to perform
construction work at eight condominium units that KST2 owned in Astoria, Queens. Toward that end, the parties entered into a construction contract that, amongst other things, required Pretree to obtain all required permits, and required certain initial payments to be made to Pretree—which were made. At the time Pretree entered into the contract, it did not have the required insurance, and it could not immediately obtain the permits needed to commence construction. These permits were ultimately obtained eight months later, but Pretree performed no work and was subsequently terminated.
KST2 commenced a lawsuit to recover the up-front monies it paid to Pretree, and Pretree filed an answer with counterclaims for both breach of contract and unjust enrichment. The counterclaims specifically alleged that KST2 breached the contract by failing to make complete up-front payments, and that Pretree had incurred substantial costs for pre-construction services that were unjustly retained by KST2.
KST2 filed a motion to dismiss Pretree’s counterclaims alleging, insofar as against the unjust enrichment counterclaim, that it could not be maintained where there was a valid contract governing the subject matter of the claim.
The motion court denied KST2’s motion and permitted Pretree’s counterclaims to survive, finding that they were not “utterly refuted” by the documentary evidence, and were otherwise legally sufficient. KST2 appealed, and the appellate court reversed to the extent that it dismissed the unjust enrichment counterclaim. In doing so, the appellate court cited well-settled law that an unjust enrichment claim cannot be asserted where there is a valid contract, and that since Pretree alleged that “[KST2] failed to submit the payments as required by the contract,” it specifically acknowledged that there was a contract which governed the subject matter, thus dooming the unjust enrichment claim.
As the appellate court noted, unjust enrichment is not meant to be a duplicative claim of a breach of contract claim. However, the unjust enrichment claim may be appropriate where there is a potential issue as to whether the contract was properly entered into, or otherwise as to its validity—or where it may simply be economically beneficial to reject the contract and sue for market-value damages.
While courts generally permit claims to be asserted in the alternative, one must be careful not to assert the breach of contract claim in such a way that it prevents the contractor from recovering on the unjust enrichment theory, if it’s more appropriate. Contractors would be well advised to consult with construction counsel to discuss their specific options of what claims to assert, how to best assert those claims—and when— so that all options are kept open.
About the author: Thomas H. Welby, an attorney and licensed professional engineer, is General Counsel to the Construction Industry Council of Westchester and the Hudson Valley, and is the Founder of, and Senior Counsel to the law firm of Welby, Brady & Greenblatt, LLP, with offices located throughout the Tri-State/Greater Metropolitan Region. Gregory J. Spaun, General Counsel to the Queens and Bronx Building Association, and an attorney and a partner with the firm, co-authors this series with Mr. Welby.
Building Congress Expects $174.1B In Spending Resurgence Thru 2023
NEW YORK — Following the steep drop in building activity across New York City in 2020, the next three years are expected to see a significant resurgence in spending and job creation as the industry continues to advocate for increased public investment. The New York Building Congress’ New York City Construction Outlook 2021-2023 released on Oct. 14 forecasts spending to increase to $60.6 billion in 2021, up 26% from 2020, when non-essential construction was shut down for 11 weeks.
The report was released at the annual Building Congress Construction Industry Breakfast at which Gov. Kathy Hochul delivered the keynote address.
“Each year I travel to every county in New York State, and I see how infrastructure is not just an abstract concept but an integral part of every New Yorker’s life,” said Gov. Hochul. “As governor, I will pursue an ambitious agenda that brings our infrastructure into the 21st century—because it’s in our DNA as New Yorkers to dream big and tackle the impossible. We can’t get
that done without strong public-private sector partnerships like with the New York Building Congress, and I look forward to continue working together to build New York’s future.”
“Despite the economic impact that COVID-19 has had on New York City since the start of the pandemic, the building industry proves its strength time and time again, as spending and job creation continue on an upward trend from 2020,” said Carlo A. Scissura, president & CEO of the New York Building Congress. “With a long road to economic recovery ahead, the ever-present threats of climate change and infrastructure that’s crumbling, we need meaningful, immediate support from Washington. Investments in the infrastructure are investments in a stable and vibrant city, state and nation.”
Key insights from the report include:
- Construction Employment to Increase: The industry will likely add 135,000 new jobs to the economy in 2021, but employment will remain at the lowest point since 2014. Employment will likely continue on an upward trend in the coming years, with 140,200 jobs in 2022 and 157,100 jobs in 2023.
- Overall Spending: Construction spending is expected to total $174.1 billion between 2021 and 2023. Compared to the pre-COVID-19 period of 2017 to 2019, when building was at a high point, spending is forecasted to decrease by just $1.5 billion. When adjusted for inflation, however, the drop is a significantly higher $38.2 billion.
- Government Spending: Government spending is up from 2020—when $21.3 billion was invested by New York City, New York State and major agencies—but will decline in the forecasted period from $23.1 billion in 2021 to $22.2 billion in 2022 and then to $21.1 billion in 2023. While government spending is expected to be higher over this period when compared to 2017 to 2019, public investment is lower now than during the height of the Great Recession when adjusted for inflation. This decline is especially significant given the need for government spending to spur economic recovery.
- Residential Construction Spending: The Building Congress forecasts $13.6 billion in residential construction spending this year, up 21% from 2020. Over three years, spending is expected to total $36.6 billion, which is down 33% from 2017 to 2019.
- Non-Residential Construction Spending: Non-residential construction spending, which includes office space, education, healthcare, public buildings, sports and entertainment venues and hotels, is projected to total $23.7 billion in 2021, dip to $22.2 billion in 2022 and rise to $25 billion in 2023.
- Public Transit Spending: The MTA will spend 33% more on construction projects over the next three years than the pre-COVID period from 2017 to 2019. When adjusted for inflation, however, this is a more modest increase of 7%.
“It’s clear that confidence in New York City’s construction and real estate industries remains high, and for good reason,” said Gary LaBarbera, President of the Building & Construction Trades Council of Greater New York. “Time and again, it’s been major infrastructure and public works projects that have stimulated economic activity that leads to recovery, and as always, our members are ready to get to work to build back New York stronger and more resilient than ever. It’s critical that we sustain this upward trend in construction activity with the successful passage of the Bipartisan Infrastructure Framework, which will invest in New York’s future and create tens of thousands of middle-class careers with benefits in the process.”
“Real estate and construction represent 10% of the city’s GDP and is the fastest way of creating the jobs to rebuild the city’s economy,” said Louis J. Coletti, president and CEO of the Building Trades Employers Association.
The data and projections in the report were generated without the once-in-a-generation federal infrastructure bill that is being discussed in the House of Representatives, which would have a massive economic impact on New York City and the entire country. If the $1.2-trillion plan was to pass, it would expedite construction of the Gateway Program—a long-delayed but nationally crucial infrastructure project that could potentially generate $19 billion in economic activity, the New York Building Congress stated.
The Construction Outlook report provides a three-year analysis and forecast of construction spending and employment in New York, while also providing deeper insight into the factors that could shape the industry and the city’s economy in the coming years. The New York Building Congress for the first time also adjusted its projections for inflation, giving a fuller picture of how spending compares historically. The latest report forecasts the second-highest spending period in real dollars, and the fourth highest when adjusted for inflation.
P. Gilbert Mercurio
Longtime Realtor CEO
By JOHN JORDAN
WHITE PLAINS — A man who for more than three decades was a driving force behind the growth and growing respect of the real estate industry in Westchester County, P. Gilbert Mercurio died on Sept. 27 at the age of 78.
He led the Westchester County Board of Realtors and its successor organization the Westchester Putnam Association of Realtors from 1980 through the end of 2011. Mr. Mercurio was well respected in the real estate industry as well as in political and business circles and was called upon by municipal, county, state and federal leaders for his business and economic knowledge and expertise.
In his last year as CEO in 2011 of WPAR, Mr. Mercurio supervised the preparations for the merger of the Westchester-Putnam operations with the Realtor organizations and multiple listing services representing Rockland and Orange counties, creating the 11th largest Realtor association in the USA with more than 9,500 individual members and more than 1,000 Realtor offices. The new entity, Hudson Gateway Association of Realtors, Inc., came into existence on Jan. 1, 2012.
Mr. Mercurio also penned an article in Westchester Realtor and its successor publication Real Estate In-Depth entitled “Up Front” for all 31 years of his association with the Westchester County Board of Realtors.
During Mr. Mercurio’s tenure with the WCBR and later WPAR the organizations were particularly instrumental in proposing and successfully advocating for strong consumer protection measures adopted in New York State including mandatory property conditions disclosure, mandatory real estate agency disclosure, higher standards for the licensing and continuing education of real estate licensees and mandatory special training in fair housing practices.
Hudson Gateway Association of Realtors CEO Richard Haggerty said, “He was a true visionary leader and one of the most intelligent and thoughtful individuals I have ever had the pleasure to meet. He was a friend and mentor to countless members as well as staff.” Mr. Mercurio strongly recommended Mr. Haggerty to the Board of Directors back in 2011 to be his successor.
Mr. Mercurio was very active in his Realtor association management profession. He served on many committees of the New York State Association of Realtors including Executive, Finance, and Legislation. He was the founding chairman of the Association Executives Committee of that organization. He was a member of the State and Local Issues Committee of the National Association of Realtors and he held the Omega Tau Rho designation of that organization, signifying exceptional service.
From 1973 to 1980, Mr. Mercurio was Director of Research and Planning for the Westchester County Association and the World Trade Club of Westchester. Previously he was an urban planner for a private consulting firm as well as the Bergen County and Westchester County Planning Departments, the latter from 1970 to 1973, during which time he worked on and authored parts of the county’s initial master plan titled “Urban Form.” He earned a degree in urban planning from the Columbia University School of Architecture.
Mr. Mercurio had an extensive record of participation in the business and civic life of Westchester County including former service as a Director of the Westchester Housing Fund, Westchester Housing Forum, Westchester Equity Fund, and Westchester Partnership for Economic Development; Chairman of the Urban Centers Task Force of the Westchester 2000 project; President of a White Plains neighborhood association; member of the original County Commission on the Homeless, White Plains Planning Board, Housing Action Council, and White Plains Housing Information Service, among many other organizations. He also served as a trustee of the Westchester County Historical Society.
Mr. Mercurio was born on Aug. 2, 1943. A graduate of Regis High School and Columbia University, he was a 1968 combat veteran of the Vietnam War and was awarded the Bronze Star Medal and Army Commendation Medal. He married Sharon Kay Finley in 1970, who survives him. In addition to his wife, he leaves three children, Claudia (Alex), Curtis and Douglas; and five grandchildren.
Services were held on Fri., Oct. 1, at the Ballard-Durand Funeral & Cremation Services in White Plains.
Despite Commercial Building Decline, Contractors Are Optimistic for 2022
By MICHAEL PATON
The Dodge Momentum Index dropped 3% in August to 148.7 (2000=100) from the revised July reading of 154.0, according to Dodge Data and Analytics. This Momentum Index is a monthly measure of nonresidential building projects in planning, which have been shown to lead construction spending for nonresidential buildings by a full year. Projects entering the earliest stages of planning have declined following the torrid pace set in the spring.
The decline in August was the third consecutive drop in the Momentum Index, which is now off 14% from the most recent high in May. Since May the commercial component is down 10% and the institutional component is 22% lower. This reversal occurred as prices for
materials used in nonresidential buildings increased in combination with a shortage of labor and a rising number of new COVID-19 cases from the Delta variant, all working in concert to undermine confidence in the fledgling construction recovery. There were some pockets of strength in August, however, as more data center, education and warehouse projects moved into planning relative to the prior month.
Despite the recent declines in the Momentum Index, it is still too early to call this a retrenchment or a new cyclical downturn. Demand for nonresidential buildings remains weak, but the recent rising number of new COVID cases should not cause the same amount of disruption as previous waves did. As the economy continues to move forward, momentum will return to the construction sector and moderate growth in projects entering planning will return.
Another report, the Civil Quarterly, also from Dodge Data and Analytics, found that most civil contractors are optimistic about the volume of work they expect in 2021 and 2022. Moreover, they anticipate both revenue and profit margin increases for their companies as a result. However, that optimism may be overshadowed by increasing concerns around skilled worker shortages, including an expectation of rising costs for talent and reduced skill levels in the available workforce. The study also finds that the volume of work for civil contractors has already increased, with 40% reporting increases to their backlogs, compared to 25% last quarter. This quarter also marks the second consecutive quarter of growth of backlogs growth to ideal levels after hitting a nadir in the fourth quarter of 2020.
The civil contractors outlook for the near future is also positive, with two-thirds expecting a strong market in the next 12 months. The positive trend continues with more than half of civil contractors expecting increased revenues in the next 12 months, and nearly half anticipating that their profit margins will grow in that same time period. Considering the survey was conducted in the first quarter of 2021, this optimism was likely based on the assumption of the national infrastructure funding bill passing Congress. However, this has led to striking increases in their concerns about finding skilled workers. Sixty percent of contractors say their need to hire skilled workers in the next three months is high, a 17-point jump from the fourth quarter of 2020. When looking at all contractors who will be hiring, including those with more moderate needs for workers, 69% report that they expect a high degree of difficulty in finding workers, up 11 points from the fourth quarter. Yet the biggest concern is the cost of workers, with 81% of civil contractors anticipating the cost of skilled workers to increase.
The current study revealed that when it comes to training efforts, 13% of civil contractors take a minimal approach, while about a third have a strong ongoing training program for new workers as a long-term investment to increase their skills for their company. Yet most recognize the importance of training their field staff in a variety of skills. More than three-quarters consider training on community, leadership and digital skills, along with site-specific safety issues, of moderate to high value for their field staff. The majority (79%) relies on training from supervisors, but over half now take advantage of online training tools as well. Nearly all civil contractors (86%) see the need to draw more workers under 30 years old into the industry, with about two-thirds surveyed believing this younger talent brings different skills, such as the capacity for faster technology adoption and the ability to collaborate digitally, to their projects.
Finally, the study also re-examined the technology adoption trends first featured in the second quarter 2020 report. Even before the pandemic, the use of technology onsite has been an area of growing interest for many contractors. Two particular technologies—equipment tagging and utility detection tech—are a clear standout with notably wider adoption in the first six months of 2021 than in all of 2020. Technology adoption for utility detection and drones has also seen a notable increase as they are now widely accepted and more widely used. However, technology adoption for virtual and augmented reality is still low as they are used by fewer than 10% of contractors. The wider use of onsite technology is important because of the positive impact it can have on productivity, which is the top benefit expected by contractors from their use of these technologies.
About the author: Michael J. Paton is a portfolio manager at Tocqueville Asset Management L.P. He joined Tocqueville in 2004. He manages balanced portfolios and is a member of the fixed-income team. He can be reached at (212) 698-0800 or by email at MPaton@tocqueville.com.
‘My Aching Back!’ No More: Avoid Hazards From Manually Handling Materials
By GEOFFREY S. POPE, ESQ.
This month’s column is inspired by materials I found online, published by the European Agency for Safety and Health at Work. OSHA’s construction standards do not have a subpart dedicated specifically to ergonomic approaches to prevent or ameliorate lower back pain (which, in Europe, is said to be the #1 item among reported work-related disorders).
Although apparently this isn’t an OSHA compliance issue, your company would do well to carry out assessments of how tasks are performed, provide training to your employees, and act to protect employees from cumulative harm to the musculoskeletal system over months and years of repetitive lifting and handling activities on the jobsite. Generally described, your company should be doing the following:
- Designing and organizing tasks to avoid or limit the handling of materials manually;
- Employing automation and lifting devices;
- Where repeated lifting and manual handling cannot be avoided, organizing the work in a safe way, by dividing larger loads into smaller ones, providing rest periods, etc.;
- Training employees in the correct handling of materials, including the opportune use of equipment, and how frequently-required tasks should be performed.
“Manual handling” can be defined as supporting or transporting a load by lifting, holding, putting down, pushing, pulling, carrying, or moving it. In the EU at least, just under two-thirds of all workers spend at least a quarter of their working hours performing such tasks, and (in addition to fatigue) two varieties of injuries may result. One includes sudden events, such as cuts, bruises, fractures, and the like, and the other variety involves damage to muscles, tendons, ligaments, bones, joints, bursa (the small, fluid-filled sacs that reduce friction between moving parts in the body’s joints), blood vessels and nerves.
What are referred to as musculoskeletal disorders are divisible into three groups: neck and upper limb disorders; lower limb disorders and back injuries and back pain. Most people experience lower back pain to some extent by age 30, and between one-quarter and one-half of construction workers complain of it.
The factors that make manual handling more or less hazardous fall into four groups: the load, the task, the environment and the individual. The risk of back injury increases if the load is too heavy (20 lbs.-25 lbs. is heavy for most people, especially if the load must be handled repeatedly), too large, difficult to reach or to grasp, unbalanced, or contains items within that move around. A basic rule is that items should be lifted and carried as close to the body as possible.
Pushing and pulling generally impose fewer stresses on the body than lifting and carrying. Unbalanced loads are difficult to support, and sudden movement can throw the bearer off-balance. Gloves, handles or other aids for gripping can make it easier to maintain one’s grasp. Loads that can only be reached with outstretched arms, or by bending or twisting the torso, may harm the spine, and carrying loads with sharp edges or dangerous materials is also to be avoided.
As for “the task,” the same can be very rigorous, if carried out over and over for too long a period, or at a tempo that cannot be varied by the worker, or without sufficient rest periods.
The “environment” means factors such as the space available to carry out the handling, the condition of the floor or working level, climate and illumination. If a large load must be hefted in a tight space, awkward body postures may be required, which can require joints to be held close to their maximum range of movement, or result in a heavier load on the joints and spine and increased fatigue.
If the flooring is wet, uneven, or subject to moving (e.g., the deck of a fishing boat) handling materials becomes more difficult and accidents more likely. Temperature, humidity, and ventilation affect a worker’s ability to carry out handling operations, especially if the same are to be repeated over the course of the workday. Poor lighting may increase the risk of an accident, or require the employee to work in awkward positions.
Naturally, individual factors also affect the likelihood of back injuries or other bad outcomes from handling operations. An employee’s size, fitness, strength, lifestyle, age, medical history, experience, training, familiarity with the job and the tasks to be performed, and willingness to use personal protective equipment all affect his or her ability to perform handling operations and prospects of avoiding injury while doing so.
Your company should carry out a risk assessment, or examination of potential hazards from manual handling operations, consider carefully the tasks, and locations where they are performed, that could produce accidents, injuries, or poor health. Evaluate whether procedures and precautions in place are sufficient to minimize risks of harm, and what additional measures might be taken.
Among other things, you should consider the practicability of eliminating the “manual” element of at least some manual handling, and reduce or avoid altogether employees having to lift, carry and move things, by instead using devices such as conveyor belts, lift trucks, electric hoists or a gravity-powered roller track. Due consideration should be given to the potential downside, however (e.g., possible noise or hand-arm vibration hazards) from any alternatives being considered.
If the elimination of manual handling is not possible, or technical measures are ineffective in reducing the risks, you should next consider organizational or administrative measures. For example, heavier items could be lifted or carried by two people instead of one, or amounts to be handled could be reduced, or loads split into two or more smaller ones.
The pace of manual handling should not be set by a machine, supervisor or co-workers. The time for performing manual handling tasks should be extended by providing for breaks, or by alternating such tasks with other tasks, to allow muscles time to recover.
Pretty much all construction employees, even those who infrequently have to perform manual handling, should be trained in the correct techniques for lifting and carrying, and for pushing and pulling devices such as barrows and trolleys.
If your company has employees who must frequently perform manual handling, I commend to you NIOSH Publication No. 2007-131, “Ergonomic Guidelines for Manual Material Handling,” which you can download online. It contains a wealth of information that will make their lives easier, more productive, and less painful.
About the author: Geoffrey S. Pope is of counsel to the construction law firm of Welby, Brady & Greenblatt, LLP, with its main office in White Plains. The articles in this series do not constitute legal advice, and are intended for general guidance only.
New York City Update
DiNapoli: NYC Office Market Will Take Years to Recover from Pandemic
NEW YORK — The COVID-19 pandemic wiped out years of growth in New York City’s office sector, erasing nearly $28.6 billion in market value and more than $850 million in property taxes in New York City Fiscal Year (FY) 2022. Timing its recovery is an open question, however, as employers continue to offer work-from-home options, according to a report released on Oct. 7 by New York State Comptroller Thomas P. DiNapoli.
“Midtown and the Financial District are two of the largest business districts in the world. Demand for space led citywide office sector property values to more than double in the decade before the pandemic,” Mr. DiNapoli said. “When the pandemic hit, companies shifted office workers to remote work, rents fell, and vacancies rose. I am optimistic for the sector’s recovery but it’s short-term future remains uncertain as employers assess future use of the space. The city should closely monitor trends in the sector and consider the future impact on tax revenues.”
Questions over the configuration of space and a potential uptick in per-worker square footage may take years to settle. The continuation of the pandemic, firmer changes to commuting patterns, increasing subleases and vacancies, and the return of demand for residential space are likely to influence conversations over the best use of physical space in the coming months and years.
The full market value of New York City office buildings, estimated at $172 billion in FY 2021, fell 16.6% in the FY 2022 final assessment roll, the first decline in total office property market values since at least FY 2000, reflecting decreased demand brought on by the COVID-19 pandemic. The city had 463 million square feet of inventory as of the second quarter of 2021, accounting for 11% of all office space in the nation.
Pre-Pandemic Job Growth Drove Demand for Space
New York City’s office sector reached a total of 1.6 million jobs in 2019, the highest level on record. Office sector employment makes up about a third of all jobs in the city, compared to a quarter in the rest of the state and the nation. In 2019, the sector contributed $705 billion to the city’s gross product, accounting for 66% of the city’s output.
Most office sector workers in the city were well paid, with an average annual salary of $183,900 in 2020. Even when excluding high earners in the financial securities sector, the average salary was $145,290. This is higher than the citywide average ($110,190) and much higher than the average for non-office jobs ($62,730).
In FY 2021 (assessed before the pandemic began), office property values reached $172 billion and billable values (the market value on which property tax is levied) reached $71 billion. Both had more than doubled over the prior 10 years. Office market values made up about 13% of total market values.
Office Space After the Pandemic
In 2020, office employment fell 5.7% while total employment dropped 11.1%. Many office workers shifted to remote work, with just 5% on-site in April 2020.
DiNapoli’s report found that average asking rents showed little change in the early stages of the pandemic, but began to fall significantly in the fourth quarter of 2020. By the second quarter of 2021, asking rents were down 4.2% from the prior year and vacancy rates were at 18.3%, a level not seen in over 30 years. The large volume of vacant office space has revived conversations about the conversion of some of that space into residential housing.
The office sector began experiencing measurable changes in demand in the second quarter of 2020 when Manhattan new leasing fell to 2.5 million square feet, 75% below the level one year earlier. Renewal activity fared better at 7.2 million square feet, a decrease of 15% from 2019.
Reduced demand for office space contributed to a 5.2% decline in overall billable values in FY 2022, the first decline in more than 20 years. Some of the city’s most expensive office properties dropped significantly. For example, the market price of the World Trade Center complex dropped by 23.1%.
In FY 2021, the office sector provided an estimated $6.9 billion in direct revenue in property taxes, real estate transaction taxes, mortgage taxes and commercial rent taxes. Property taxes from the office sector raise more than any other property type subcomponent (e.g., single-family homes or multifamily rental buildings). Office sector property tax collections alone surpassed the entire budgets of the city’s Sanitation, Fire, Transportation, and Parks and Recreation departments, combined.
Commercial real estate such as office and retail buildings account for an outsized share of tax collections because they are assessed at a much higher rate than residential properties. In FY 2021, office buildings accounted for 12.6% of the market value of properties on the assessment roll, but more than a fourth (26.2%) of the billable taxable values at $71 billion.
The city collected $1 billion in transfer taxes and $816 million in mortgage taxes in FY 2021, the second year of declines as a result of pandemic impacts. DiNapoli estimates that $216 million of these taxes were generated by office properties, less than half of the $461 million generated in FY 2020.
Office employment has remained steadier than overall employment and is expected to continue to grow, which is likely to support future demand for space. Multiyear leases extending into 2023 and healthier balance sheets of property owners have also provided some short-term stability in the office real estate market.
The city’s tentative assessment roll for FY 2023, to be released in January 2022, will provide further insight on the potential duration and magnitude of the impact on city finances.
Mr. DiNapoli urged the city to monitor the overall employment and real estate markets, including differences in submarkets, to deliberate carefully over its choices to influence office employment and space, and to ensure that policy decisions will mitigate negative impacts on tax revenue and the economy.
Prospects of Invigorated Spending on Public Works A Signal to Review Readiness to Bid on Infrastructure
As has been much publicized recently, there is a large amount of federal funding coming for physical infrastructure work, including roads, bridges, electric vehicle charging stations, tunnels and public transportation among other pressing needs. The funding largely targets transportation (including airports), utilities (including public high-speed internet) and pollution, which includes superfund sites.
In a fact sheet released by the White House called “The Need for Action in New York,” the Biden administration claims they will be making a historic investment in the State of New York. The need has perhaps never been greater, as commute times have increased more than 7% since 2011 and subways (COVID-19 aside) are growing more congested and delayed due to aging. Added to this,
superstorms, hurricanes, flooding and other climate-related issues are stressing public and private infrastructure alike. New York alone has suffered more than $100 billion in damages in the last decade due to storms.
Biden’s “American Job’s Plan” also details a planned $300-billion investment in manufacturing, with a focus on innovative energy projects. They plan to provide incentives to companies that do these sorts of projects and are also funding and supporting the increased use and implementation of clean energy resources and eco-friendly buildings for both private and public construction projects.
Large housing projects could also be more prevalent in the near future, as the Biden bill includes grants that award funding to cities that curb prohibitive multifamily zoning laws to encourage new affordable housing creation, a major need in the New York area.
With both urgency and a large-scale availability of public funds, construction companies will likely see a great deal of activity in the infrastructure sector in the coming years. They should start planning now to bid and win this work.
However, bidding on public sector work is different than working with private owners and developers and there are things to consider.
Look to P3 Projects
Despite the availability of federal funds, they won’t cover the full cost of New York City’s infrastructure needs, and so state and city agencies will look to ways to maximize both federal funding and their own. For years now, public-private partnerships have been gaining traction because of their ability to provide financial support for the building and maintenance of public infrastructure. By increasing private sector participation, projects are done more quickly and both the public agency and the contractor can share in the risks and rewards of the project.
One of the major ways these projects drive value up and costs down is by employing a design-build (D-B) delivery method. It’s important then to be able to communicate your firm’s D-B capabilities and how you’ve delivered these kinds of projects successfully, within budget and on time. If this is a burgeoning capability within your organization, then it’s highly important to ensure you have the leadership and project personnel with the experience to instill public confidence.
Register with City And State Agencies
Each city and state agency have their own processes, designed to foster competition, fairness and transparency. In keeping with this, contractors must register with various public agencies accordingly. For example, the City of New York now uses PASSPort as its online procurement platform, while the MTA has its own Contractor Portal, where all bidders must register.
In some cases, such as with the city, registration can be fairly complex. The NYC DOT, for example, keeps pre-qualified lists on contractors in two categories for bridges: Bridge Design and Construction Support and Bridge Resident Engineering Inspection. Within these two categories, the DOT has three additional lists for project sizes—i.e., small, medium and large. Firms can’t register for every list, so it’s important to assess what kinds of projects you can deliver on and what’s worth your firm’s time.
Infrastructure projects are anticipated to create significant opportunities for New York’s Minority-and Women-Owned Businesses. For smaller New York State projects, there is surety bond assistance as well as some advantages when it comes to bidding that firms should consider. For bidding on any construction, reconstruction, alteration, repair, or improvement of a state building on projects under $1.4 million, an M/WBE that bids within 10% above the lowest bid is considered the lowest bid. (Also important: if your firm has not yet done so, it should officially register as an M/WBE if certified.) For non-M/WBE firms, it’s equally important to become familiar with M/WBEs in the market that have the scale and ability to perform work on the projects you’re delivering, as well as the public agency requirements or incentives for diversity and inclusion on those projects. All government-funded projects will have M/WBE compliance requirements.
Public-sector construction projects generally require surety bonds from their contractors to help ensure project completion. The surety bond is an additional requirement for contractors that do public work. The contractor needs to have an established surety program with an overall and individual job surety bond program/limit. There are many factors that go into establishing a surety bond program so it’s crucial to have this in place. It’s important for contractors to have a trusted surety relationship in place and work with them to determine the level of bonding needed to support the work they intend to bid on, as well as the related requirements.
Make sure your construction company strategically plans for the upcoming public work. Here’s to a better year ahead!
About the author: Phillip Ross, CPA, CGMA is an Accounting and Audit Partner and Chair of the Construction Industry Group at Anchin, Block & Anchin, LLP. For more construction industry thought leadership and content, log on to www.anchin.com.
NYS Selects Two Green Projects Valued at $8.2B
By JOHN JORDAN – September 27, 2021
NEW YORK — New York State has selected two major green energy infrastructure projects that will cost $8.2 billion to develop and help bring wind, solar and hydropower from Upstate New York and Canada to New York City involving approximately 513 miles of transmission line. The two ventures, if they secure final approvals, will create approximately 10,000 jobs.
The construction building trades will also benefit from the two projects—Clean Path NY (CPNY) and Champlain Hudson Power Express (CHPE)—since the state will be requiring the two awarded contracts to “include prevailing wage provisions for all laborers, workers, and mechanics performing construction activities with respect to the construction of the projects. In addition, the project developers will be required to negotiate Project Labor Agreements among their construction contractors and a building and construction trade labor organization representing craft workers for the construction of the new transmission lines as well as for the construction of the new renewable energy generation resources that the developers and its affiliates build for this project in New York State.”
The selections were announced on Sept. 20 at an event held in New York City attended by New York Gov. Kathy Hochul, New York City Mayor Bill de Blasio and a host of other state and city dignitaries.
The two projects will help reduce New York City’s reliance on fossil fuels, lower carbon emissions and significantly improve air quality and public health in disadvantaged communities while accelerating progress to exceed New York’s goal for 70% of the state’s electricity to come from renewable sources by 2030 on the path to a zero-emission grid as outlined in the Climate Leadership and Community Protection Act (Climate Act).
“New York’s communities are repeatedly facing serious consequences as a result of the devastation caused by the global climate crisis, and the stakes have never been higher as we deal with the economic and environmental destruction that these extreme weather events leave behind,” Gov. Hochul said. “These transformative projects are a win-win—delivering thousands of new, good-paying jobs throughout the state and attracting billions of dollars in private investment. They also help us turn the page on New York City’s long-standing dependence on fossil fuels and will ensure millions of New Yorkers, especially those living in our most vulnerable communities, can have the promise of cleaner air and a healthier future.”
“This is a transformative moment for New York City’s fight against climate change,” said New York City Mayor Bill de Blasio. “Two new transmission lines connecting New York City to electricity from water, the wind, and solar will create thousands of good union jobs, improve the resilience and reliability of our power supply, and dramatically reduce our reliance on oil and gas electricity that dirties the air in our neighborhoods and endangers our planet.”
Combined, the awarded Clean Path NY (CPNY) project, developed by Forward Power (a joint venture of Invenergy and EnergyRe) and the New York Power Authority, and Champlain Hudson Power Express (CHPE) project, developed by Transmission Developers, Inc. (backed by Blackstone) and Hydro-Québec will: produce approximately 18 million megawatt-hours of upstate and Canadian renewable energy per year, enough to power more than 2.5 million homes; reduce greenhouse gas emissions by 77 million metric tons over the next 15 years, the equivalent of taking one million cars off the road; and provide $2.9 billion in public health benefits over 15 years that will result from reduced exposure to harmful pollutants.
CPNY and CHPE will invest approximately $460 million in community benefit funds to create pathways to green energy jobs, support public health, advance capital improvement projects, realize habitat restoration and improve the environmental footprint of buildings in disadvantaged communities.
The projects were selected for contract negotiation as part of the New York State Energy Research and Development Authority’s (NYSERDA) Tier 4 renewable energy solicitation issued in January. Once finalized, NYSERDA will submit the negotiated contracts for these awarded projects to New York’s Public Service Commission for consideration and approval. If the Tier 4 contract is approved, NYSERDA payments under this award will not commence for each respective project until the project has obtained all required permits and local approvals, is constructed and delivers power to New York City, which is expected to begin in 2025 for CHPE and 2027 for CPNY.
CPNY’s 174-mile transmission line will run from the Fraser Substation in Delaware County to the Rainey Substation in Queens, utilizing a buried cable using existing rights-of-way, which will mitigate potential local community impacts, avoid sensitive habitats along the Hudson River, and be more resilient than above-ground alternatives in the face of severe weather and security threats.
CHPE is a permitted 339-mile buried cable, both underground and underwater, transmission line that runs from Hydro-Quebec’s wind and hydropower resources in the Province of Quebec to the Astoria Energy Center in Queens, NY and has adopted best management practices to avoid, minimize and mitigate environmental damages, including impacts on sensitive species and habitats.
NYSERDA President and CEO Doreen M. Harris said of the selection of the two projects, “Investing now in these major renewable energy infrastructure projects will bolster the state’s economic recovery at a time when New Yorkers truly need it and will accelerate our progress in providing clean, resilient, renewable energy to some of the state’s most densely-polluted and underserved communities.”
Hydro Quebec CEO Sophie Brochu and Transmission Developers CEO Don Jessome said, “We are honored that Quebec hydropower, delivered over our permitted, fully buried, construction-ready transmission project has been chosen to join other important renewable projects as the state and city work toward achieving their climate mandates. We commend Governor Hochul and NYSERDA for their clean energy leadership and we look forward to quickly delivering the project’s immense clean energy benefits and new jobs to the state. We are deeply grateful for the many labor organizations, environmental stewards and municipalities throughout the state that have supported this project.”
Clean Path NY leaders Jeff Blau of energyRe, Michael Polsky of Invenergy, and Gil C. Quiniones of the New York Power Authority said, “Clean Path NY is the most significant U.S. renewable energy infrastructure investment in this century and a defining project for the advancement of clean energy in New York—one that will dramatically reduce carbon emissions, catalyze green jobs across the state, provide crucial environmental justice benefits and fundamentally change the way our state is powered. Pairing innovative wind, solar, and storage projects with state-of-the art transmission to bring clean energy directly to New York City, Clean Path NY will be a truly transformative renewable energy project.”
If approved, the CPNY and CHPE projects will add to New York’s existing pipeline of large-scale renewable energy, comprised of nearly 100 solar, land-based wind and offshore wind projects totaling 11,000 megawatts of clean power—enough to power over five million New York homes when completed. The state’s commitment to building out new green energy transmission, led by 250 miles of new major upgrades already underway throughout the state and reinforced by this award, will allow the current pipeline of renewables to power nearly 60% of New York’s electricity from renewable energy once operational.
A host of business and environmental advocacy groups praised the project awards. The International Brotherhood of Electrical Workers (IBEW) International Representative Edwin Hill, Jr. said, “The International Brotherhood of Electrical Workers (IBEW) of New York applaud New York State and NYSERDA’s efforts to combat climate change and to protect existing worker standards and to ensure impacted and disadvantaged community engagement with the Tier 4 – New York City Renewables Energy RFP. The Tier 4 will play a critical role in meeting the state’s climate legislation, the Climate Leadership and Community Protection Act, which requires NY’s energy supply to be 70% carbon-free by 2030. The ensuing project(s) will provide thousands of good paying, career level, jobs for NY’s residents across the state and inject billions of dollars into NY state’s economy while greatly improving the environment for its citizens. The IBEW looks forward to playing a vital role in ensuring success of this world class initiative.”
Building & Construction Trades Council of Greater New York President Gary LaBarbera said, “This is a crucial step forward in bringing necessary clean and renewable energy to the City of New York, while ensuring that good union jobs that lead to middle-class careers with benefits remain central to the way New York generates and delivers its power. We thank Governor Hochul for her focus and commitment to creating family-sustaining jobs as part of the state’s comprehensive and ambitious plan to meet its clean energy goals.”
New York State Laborers Organizing Fund Director John Hutchings said, “We applaud Governor Kathy Hochul and NYSERDA for continuing to advance critical infrastructure projects. These projects will accelerate the state’s shift to renewable energy and lead to hundreds of construction jobs that pay workers a prevailing wage. The New York State Laborers are encouraged by Governor Hochul’s continued commitment to ensuring a just transition for our members while the state transitions to an economy wide goal of net-zero carbon emissions by 2050.”
Industry Must Tackle Workforce Challenges
By JOHN JORDAN – September 27, 2021
TARRYTOWN, NY — If ever the construction industry was at a crossroads, it’s now. The sector faces a host of challenges ranging from projected workforce shortages, continued impact of COVID-19, supply constraints and the need for long-term dependable funding programs from government. Let’s hope the massive infrastructure bill that President Biden is pressing for wins enough Congressional support to create jobs and bolster our national infrastructure, with repairing aging bridges and roadways at the top of the priority list.
But there are wicked speed bumps the industry must cross. For starters, baby boomers are now aging out of the workforce, and not enough young people are entering to replace them, a worrisome sign regional leaders report. There also may not be enough skilled workers to hire for all those new projects the Biden infrastructure bill promises. This runs the gamut in both the skilled crafts and the dirt trades.
“Do we have the work force ready right now to take care of this? Absolutely not,” said Beverly Scott at a press conference in Washington earlier this month. Ms. Scott serves as the vice chair of the President’s National Infrastructure Advisory Council. Another national group, the Brookings Institute, reports the median age of construction and building inspectors is 53. The industry is also looking at an aging workforce. The average age for all construction workers nationwide is 42.5. Approximately 10% of construction workers are under 25.
The many forewarnings are now prompting forearmings. The Construction Industry Council of Westchester & Hudson Valley, Inc., and the Building Contractors Association of Westchester & Mid-Hudson Region will present a “Workforce Development Seminar” to offer key insights into the current state of the construction industry’s labor and the issues it will face in the next few years.
An expert panel of guest speakers—namely company owners and educators—will participate in the one-hour program, which begins at 5:00 p.m. on Wed., Oct. 13, at the Westchester Marriott Hotel in Tarrytown, N.Y. The panel will feature: Erin Vitale, CPC, chair of Civil Engineering Technology at Alfred State College; Craig R. Clark, vice president of economic development at Alfred State College and executive director of the Allegany County Industrial Development Agency; James Smith, president and founder of Advance Testing Co.; and Gary Hill, president of Union Concrete Construction Co.
Reached by CONSTRUCTION NEWS this month, all panelists agreed that the projected major infrastructure funding promising to flow to New York State from the federal government–either in the form of a multi-year reauthorization of the federal transportation bill or the $3.5 trillion once-in-a-generation infrastructure bill, or both–will put pressure on the industry to supply qualified workers. They also concur that the industry and other stakeholders will have to make a better case to the region and nation’s youth about the tremendous opportunities that exist in the construction and building industries now and for years to come.
“We probably have three job offers per graduate,” Alfred State College’s Ms. Vitale said. “We don’t have enough graduates to give the employers who are coming looking.”
She added the industry needs to expand its recruitment efforts to help satisfy the labor needs of the future. Ms. Vitale said that most of the students at Alfred State, particularly those that are pursuing careers in construction management, have some sort of family connection to the construction industry.
“If we are going to grow the number of people entering our industry, we have to grow past just family members of people who already work there,” she continued. “We as an industry have to find a way to break through to the general public about what the opportunities are.”
The New York Building Congress released a Workforce Snapshot report in February of this year that of the 281,400 construction workers employed in 2019, 18.9% were above the age of 55; nearly 75% were between the ages of 25 and 54 and 6.5% were 24 or younger. The survey also found that 82.8% of the New York City construction industry workforce had a high school diploma or higher and 39.3% had some college education or higher.
Other key data points from the report included:
45.8% of all NYC construction industry workers reported incomes of less than $50,000 per year, 28% reported between $50,000 and $100,000, and 26.2% reported more than $100,000. Compared to 2018, the number of workers earning more than $100,000 increased 61%.
Nearly 76% of all workers engaged in the construction industry were blue-collar workers, including construction, installation, material moving and production workers.
A total of 82.7% of New York City’s construction industry workers were employed in the private sector.
The accounting firm Grassi Advisors & Accountants recently released its “2021 Conditions and Future Outlook” for the construction industry. The survey of 105 general contractors, subcontractors and construction professionals found that ongoing labor challenges in 2020 were exacerbated by the COVID-19 pandemic, with the primary concern shifting from finding skilled workers to keeping those workers safe. The three most common responses were:
- 51% reported COVID-19 outbreaks among workforce;
- 39% had difficulty factoring costs of COVID-19 into projects;
- 33% reduced labor productivity.
The most difficult job categories to fill, according to respondents, were project managers (25%), skilled laborers (19%), foreman (19%) and cost estimators (15%).
The industry’s biggest challenges by far in 2020 were delayed, closed or cancelled projects (81%), followed by decreased overall revenues (53%), challenges in the competitive bidding landscape (46%), decreased profits (44%) and volatility in material pricing (44%).
Of the labor challenges in 2020, only 11% cited insufficient staffing to accomplish critical work.
In terms of the industry’s future prospects, 50% of respondents felt that the construction industry’s recovery will take hold in 2022, while 20% felt it would occur by the end of 2021. Approximately 25% believe the recovery won’t occur until 2023.
For more information to attend the Workforce Development Seminar on Oct. 13, visit www.cicnys.org/events or call 914-631-6070. Also see page 25 in this edition of CONSTRUCTION NEWS for additional information. Westchester Marriott Hotel is located at 670 White Plains Road in Tarrytown, N.Y. Following the seminar, the associations while host their 2021 Annual Fall Membership meeting, beginning with a reception at 6:00 pm. See page 28 for more details.
Infrastructure Investment and Jobs Act Will Provide New York State With $25B in Highway, Bridge Funds
WASHINGTON — Every $1 increase in federal highway, bridge, and public transit investment under the Infrastructure Investment and Jobs Act (IIJA) will generate as much as $3.60 in economic activity, according to a new analysis from IHS Markit, a global information leader with expertise spanning numerous industries, including leading positions in finance, energy and transportation.
The American Road and Transportation Builders Association recently released an analysis of the impact the IIJA would have on New York State, estimating the legislation will provide $24.89 billion in state formula funds for highway, bridge, and
transit investment in New York over the next five years, including a 43% funding increase in FY 2022.
The positive impacts from IIJA-related construction activity will be felt quickly as work gets underway. The September 2021 report by global forecasting leader, IHS Markit commissioned by ARTBA, quantifies the initial outcomes:
- IIJA investment to fix New York’s roads and transit system will add an additional $6.72 billion in state gross domestic product each year.
- The increased economic activity will benefit New York residents—disposable income will increase by $2.76 billion each year, an average of $357 per household.
- State and local tax receipts will increase by an average of $1.22 billion per year. This is additional income that can be reinvested in the state, without any increase in tax rates.
- Federal investment has supported 45% of state highway and bridge capital improvements in state over the last decade and 23% of transit capital outlays. Federal transit investment supported 139 urban and rural transit agencies in New York.
Among the major national economic benefits documented in the study: The combined $153.7 billion in new highway, bridge and public transit investment under the IIJA would add $488 billion to U.S. GDP by 2027.
As federal highway and public transit investment spurs economic growth, the additional funding from the IIJA supports more than 250,000 new jobs by 2025. Over half of these positions will be outside of the construction sector.
More economic activity means federal, state, and local tax revenues will increase more than $160 billion. These revenues can be reinvested throughout local communities.
New jobs and higher wages benefit American households—with personal disposable income increasing by $69 billion by 2027, or more than $500 per household.
The $1 trillion IJJA was approved by the Senate 69-30 last month and is pending in the U.S. House of Representatives, where Democratic leaders have pledged to act on it by Sept. 27.
The report quantifies the state-level increases in GDP, disposable income, consumer spending, and state and local tax receipts from the additional highway, bridge, and public transit investment.
It also provides a breakdown of benefits by major industry, with more than 15% of the jobs created in the manufacturing, health care, social assistance, real estate, and rental/leasing sectors.
Paving the Way for Congestion Pricing
By CARLOS CASTELL CROKE
As New York begins to emerge stronger from the pandemic, congestion pricing is needed now more than ever to reduce vehicular pollution and improve public transportation. To achieve this, the NYLCV strives to efficiently work with the new governor in order to confront the transit crisis and address the climate emergency, as we, along with other advocates, stated in a letter to Gov. Kathy Hochul earlier this month.
New York’s Climate Leadership and Community Protection Act demands we minimize our emissions from transportation, as air pollution from vehicles presents a danger to the climate and New Yorkers. In just lower Manhattan, about 1 million tons of greenhouse gas emissions, consisting mostly of carbon dioxide, come from automobile and truck traffic every year. Such traffic has brought congestion and pollution, affecting the safety of driving and the health of citizens. Congestion pricing would thus limit this and encourage commuters to use other safer and cleaner modes to get around the city.
Due to the pandemic, the Metropolitan Transportation Authority’s services are facing a fiscal crisis. This includes subways, trains, and buses, all of which collectively account for over 80% of trips to the Manhattan central business district. During pre-COVID times, 33% of transit trips in the United States took place on a subway or a bus in New York City, a city that only encompasses 2.5% of the country’s population. It is thus crucial to fix and better the city’s public transportation, as people rely on it to be able to travel in the area. Congestion pricing would provide the funds needed to help address this issue by improving the city’s subway, bus, and commuter rail network.
From an economical perspective, this influx of car traffic has brought gridlock to neighborhoods in all of the boroughs. Before COVID-19 hit, traffic congestion cost businesses and families $20 billion in wasted time and resources annually. Now, with the pandemic causing public transportation to lag, this number may grow. As the city tries to restore public education, housing, health, and the economy in general, this gridlock will delay recovery. People are returning to offices and retail soon, so this is even more important as city life begins to grow again. Thus, congestion pricing can help New York City’s economy return to pre-COVID levels of growth.
If we want to minimize the impact of climate change, enable public transportation to be the crux of the city’s commuting system, and allow the economy to flourish, congestion pricing is pivotal. In fact, a recent study found that a toll of $5 would result in a reduction of over 70,000 tons of greenhouse gas emissions every year, and a toll of $20 would eliminate 40% of midtown traffic per year. With this in mind, the NYLCV hopes the new governor will help us take this step to implement North America’s first congestion pricing program.
We look forward to setting the stage for other cities in the country with congestion pricing, as the Biden administration focuses on tackling climate change alongside us. We urge this to be implemented without further delay, with the Biden administration endorsing the program and U.S. Secretary of Transportation Pete Buttigieg allowing the MTA to proceed with an environmental assessment. The MTA and the state and city DOTs have come to an agreement with the Federal Highway Administration as well. Thus, we have signed onto the letter to Governor Hochul urging her to move forward with the environmental assessment and to implement congestion pricing as soon as possible.
About the author: Carlos Castell Croke is the New York City Program Associate with the New York League of Conservation Voters.
$600 Million in State Grants Available For Water Infrastructure, Resiliency Projects
ALBANY, NY —Governor Kathy Hochul announced on Sept. 21, the availability of $600 million to communities statewide through the Water Infrastructure Improvement Act (WIIA), Water Quality Improvement Project (WQIP) Program, and Intermunicipal Grant (IMG) programs to fund projects to upgrade infrastructure and make communities more resilient to flooding and other impacts of climate-driven severe storms and weather events.
The governor also announced that she will propose a $1-billion increase to the “Clean Water, Clean Air and Green Jobs Environmental Bond Act,” which will round out its total to $4 billion. The bond act would go before voters for approval in November 2022.
The water grants will provide funding for water infrastructure projects that increase community resilience to flooding and are critical to protecting public health and the environment. In addition, the Publicly Owned Treatment Works Asset Management Program will make $10 million available to establish asset management programs that will help municipalities monitor, protect, and responsibly plan upgrades for wastewater infrastructure systems, at no cost.
An additional $5 million in Green Innovation Grant Program funding will be available to communities for green infrastructure to address stormwater, and water and energy efficiency. It is anticipated that jobs in the manufacturing, engineering, construction, plant operations and related industry sectors will be created as a result of this massive infusion of public funding.
Gov. Hochul is directing state agencies to work together to expedite the state’s ability to invest in vital green infrastructure projects, and proposing to rename the “Clean Water, Clean Air and Green Jobs Environmental Bond Act,” to recognize the urgency of the bond act investments, and work with the legislature to ensure this proposal, and the Environmental Protection Fund, Clean Water Infrastructure Act and Environmental Agency spending are appropriately structured to advance the state’s resiliency agenda to protect New Yorkers and the environment.
“It is critical that communities have the financial resources to advance shovel-ready projects that put people to work. These efforts will upgrade our infrastructure to make our communities more resilient to flooding and other climate impacts,” Gov. Hochul said. “The funding announced today will create jobs and advance essential water quality improvement projects across the state that will ensure that our public water systems are protected and we are better prepared for our changing climate. Assuring the delivery of safe drinking water is critical to the health and wellbeing of all New Yorkers and updating water infrastructure is a key component to achieving this.”
New York State Department of Environmental Conservation (DEC) Commissioner and Environmental Facilities Corporation (EFC) Board Chair Basil Seggos said, “Recent storms Henri and Ida challenged municipal wastewater infrastructure like never before, underscoring the urgent need to strengthen New York’s aging infrastructure.”
The Water Quality Improvement Project (WQIP) program is a DEC grant program that funds projects that directly address documented water quality impairments or protect a drinking water source. As part of the State’s Environmental Protection Fund (EPF), WQIP projects improve water quality, reduce the potential for harmful algal blooms (HABs), and protect public drinking water across the state. Initiatives include land acquisition projects for source water protection, municipal wastewater treatment upgrades, nonagricultural nonpoint source abatement and control, salt storage, and aquatic habitat restoration, among others.
The Environmental Facilities Corporation (EFC) will administer the WIIA and IMG programs to provide grants for wastewater and drinking water projects, working closely with the Departments of Health and Environmental Conservation. The programs prioritize sewage treatment projects that improve water quality and drinking water projects that address public health priorities, emerging contaminants and encourage local governments to work together on regional solutions.
Since the inception of the WIIA program in 2015, the state has released more than $1 billion in clean and drinking water grants through EFC, which includes more than $300 million in grants in 2019.
Local units of government are eligible to apply for funding for:
- WIIA grant awards that will fund up to 25% of an eligible wastewater project’s total cost, up to $25 million.
- WIIA grant awards will fund up to 60% of an eligible drinking water project’s total cost, up to $3 million.
- IMG awards will fund up to 40% of an eligible wastewater or drinking water project for communities that share services, up to $30 million.
- EC awards for projects addressing emerging contaminants above the state determined Maximum Contaminant Level (MCL) will fund 60% of net eligible project costs.
- WQIP grant awards that will protect drinking water sources.
Publicly Owned Treatment Works Asset Management Program
$10 million will be available for asset management programs that will help municipalities monitor, protect and responsibly plan upgrades for their wastewater infrastructure facilities, free of charge. The statewide program will take a proactive approach to managing wastewater treatment facilities by providing engineering consultant services for software and technical training to local governments to map their sewer and wastewater systems using modern digital tools. Consulting services will also assist municipalities to inventory their wastewater assets and identify weaknesses in their current systems to promote repairs before a system failure occurs. The ability to minimize costly emergency repairs and prevent service disruptions will help protect public health and the environment by reducing the threat of pollution. The New York State Environmental Facilities Corporation (EFC) will administer the program in partnership with DEC, which has regulatory oversight of wastewater facilities.
The asset management program builds upon a successful $3-million pilot administered by DEC and EFC and completed in 2021 that helped 10 local governments throughout the state to inventory their wastewater assets, identify risks to their wastewater infrastructure and determine cost-effective, tangible solutions to address issues. Up to an estimated 50 communities will be served under the next phase of this program.
A Request for Qualifications (RFQ) will be released in the coming weeks to solicit professional engineering services that will allow EFC and DEC to hire the consultant engineers. The engineers will work with the communities to develop site specific asset management programs, and the communities will also receive the software and training to maintain the programs on their own. It is expected that communities will be able to apply for the program in early 2022.
$20 million Green Infrastructure Grant Program
This program includes an additional $5 million more to be awarded from the submitted applications currently under review by EFC. The Green Innovation Grant Program (GIGP) supports projects across New York State that utilize unique stormwater infrastructure design and create cutting-edge green technologies. Competitive grants are awarded annually to projects that improve water quality and mitigate the effects of climate change through the implementation of one or more of the following green practices including effects green stormwater infrastructure, energy efficiency, and water efficiency.
Court Dismisses Delay Claim Against Non-Party to Contract
By THOMAS H. WELBY, P.E., ESQ. and GREGORY J. SPAUN, ESQ.
In this column, we have often addressed delay claims—typically in the context of when, if ever, a contractor can assert such a claim in the face of a no-damages-for-delay clause. However, the recent case of Dworkin Construction Corp. v Consolidated Edison Co. of NY, an appellate court reminds us that fundamentally, delay claims are creatures of contract and, therefore, a contract between both the proponent and the target of the delay claim is absolutely necessary to proceed.
Dworkin Construction Corp. was retained by Lush Cosmetics, a makeup retailer and lessee of a property on East 14th Street in Manhattan, to renovate a commercial space and build out a
store that would suit Lush’s particular needs. Lush’s needs included the installation of an additional electrical shunt to supply more power for the store. As a part and parcel of this scope of work, Dworkin applied to Con Ed for required approvals, to which Con Ed responded very slowly, resulting in a delay of the completion of the project. As a result of this delay, Dworkin incurred $82,805 in damages—and lost Lush’s business.
Dworkin sued Con Ed for negligence and breach of contract to recover the out of pocket expenses, as well as the claimed $1,068,405 in lost profits resulting from its loss of Lush’s business. In its complaint, it alleged that Con Ed was negligent by failing to exercise reasonable care in the processing of Dworkin’s application. Dworkin, alternatively, alleged that it entered into a contract with Con Ed for Con Ed to reasonably and diligently process its application for the service upgrade, and that Con Ed breached the contract by failing to do so. Con Ed moved to dismiss the lawsuit.
The motion court granted Con Ed’s motion, holding that even if Con Ed took an extraordinarily long time to process the application, Dworkin could not assert such a claim in the absence of a contract. Dworkin appealed, and the appellate court affirmed. As to the negligence claim, the appellate court held that in addition to Con Ed not having any common-law duty to Dworkin, the negligence claim failed because it sought only economic damages—which, under well settled case law, are limited to breach of contract claims.
As to that breach of contract claim, the appellate court found that even though Con Ed provided invoices and a “service determination” listing Dworkin as the customer, Dworkin was not doing the work for its own service but, rather, that of its customer, Lush, for which it was acting as agent. Further, and specifically as to Con Ed, the appellate court also referenced its tariff (its operating authority granted by the Public Service Commission), under which Con Ed has the obligation to provide utility services to all customers equally, and held that Con Ed does not have the legal authority to enter into any agreement which guarantees service within a particular time frame.
Dealing with utilities can be as frustrating and bureaucratic as dealing with government agencies themselves. On top of this, the frustration of delays and their financial impact on a project only add to the madness—particularly when they are not caused through any fault of the contractor or the subcontractors working under it. However, because the damages relating to a delay are purely economic, courts require an existing contractual relationship between the parties that deal with the issue, which is usually either in the form of setting deadlines with a time-of-the-essence clause (thus putting parties on notice that there could be the assessment of damages if that crucial date passes), or a liquidated damages clause which specifies damages to be awarded in the case of a delay, or a no-damages-for-delay clause. In the absence of such a contractual relationship, courts will not award such damages.
Of course, contractors should be diligent in keeping up with developments on the project—and trying to keep the project moving when it appears that one aspect has stalled. Contractors would also be well advised that where the work will necessarily involve third-parties who can influence the project without liability themselves, they should ask their counsel about what other contractual protections may be available, such as the right to extensions of time, or other exculpations from liability for delay upon the happening of certain events.
About the author: Thomas H. Welby, an attorney and licensed professional engineer, is General Counsel to the Construction Industry Council of Westchester and the Hudson Valley, and is the Founder of, and Senior Counsel to the law firm of Welby, Brady & Greenblatt, LLP, with offices located throughout the Tri-State/Greater Metropolitan Region. Gregory J. Spaun, General Counsel to the Queens and Bronx Building Association, and an attorney and a partner with the firm, co-authors this series with Mr. Welby.
Construction Advancement Institute Awards $65,000 in College Scholarship Grants
TARRYTOWN, NY—As part of its mission to enhance the professionalism of the building and construction industries in the Lower Hudson Valley, the Construction Advancement Institute (CAI) this month awarded $65,000 in grants to 13 regional undergraduate students who are enrolled in engineering, architecture, construction technology, construction management or other related programs this fall. CAI is the educational and advocacy organization aligned with the Building Contractors Association of Westchester & The Mid-Hudson Region, Inc.
The CAI Scholarship Committee reviewed more than two dozen scholarship applications, school transcripts and essays in August, explained CAI Chairman Mark Fante of Darante Construction Ltd. of Elmsford, NY. The awards to the 13 recipients are $5,000 grants for use in the current 2021-22 academic year.
“The money our industry raises and disburses for college scholarships is one of several annual charity efforts performed by members of organized labor and the construction contracting community benefitting families and schools both in the Hudson Valley region and nationwide,” Mr. Fante added. “Our goal is to strengthen the ranks of engineers and technologists employed at the companies that are members of our association. It’s one more way the association works to keep our member companies competitive and keep our local economies growing.”
Since its inception, the CAI Scholarship Program has awarded 84 grants to 46 students at more than 35 colleges and universities throughout the U.S. This year’s grant award of $65,000 also lifts the total scholarship awarded by CAI to more than $350,000 since its first year in 2009 when six grants were bestowed.
The following scholars were chosen from more than two-dozen applicants who applied for and were carefully considered by the CAI Scholarship Committee. They are:
Giovanni Altomare, 19, of Yonkers, N.Y., freshman, who will be attending Marist College in Poughkeepsie, NY, pursuing a degree in Business/Construction Management. He is the grandson of a member of the Bricklayers & Allied Craftworkers Local 1 New York.
Nicola Mario Altomare, 20, of Yonkers, N.Y., is a sophomore who attends Rensselaer Polytechnic Institute in Troy, N.Y., pursuing a degree in electrical engineering. He is the grandson of a member of the Bricklayers & Allied Craftworkers Local 1 New York.
Jake Badick, 21, of Congers, N.Y., is a senior who attends the University of Rhode Island, Kingston, RI. He is the son of an employee of BCA- member company Peter Gisondi & Co., Inc.
Valeriy Borkun, 19, of White Plains, N.Y., is a freshman, who will be attending CUNY Queens College, NY, pursuing a degree in Economics and Construction Management. He is an employee of BCA member company LeChase Construction.
Anthony Cappello, 22, of Mohegan Lake, N.Y., is a senior who attends the University of Florida, Gainesville, FL, pursuing a degree in construction management. He is an employee of Calgi Construction Company, Inc. located in White Plains.
Massimo Fante, 19, of Sleepy Hollow, N.Y., is a sophomore attending Cornell University, Ithaca, N.Y., pursuing a degree in Biological Sciences. He is the son of BCA member company Darante Construction, Ltd.
Jamie Fortunato, 20, is a junior attending the University of Wisconsin, Madison, WI, pursuing a degree in Biology/Pre-Medicine. She is the granddaughter of a member of the International Union of Operating Engineers Local 137.
Andrew J. Griffin, 22, of Yonkers, N.Y., attends New York State University at Buffalo (Graduate school), and is pursing a Master of Architect degree. He is the son of an associate of the BCA member company Yonkers Contracting.
Mark J. Griffin, 19, of Yonkers, N.Y., is a sophomore who attends the New York State University of Buffalo, pursuing a degree in Aerospace Engineering Mechanical Drawing. He is the son of an associate of the BCA member company Yonkers Contracting.
Timothy Kohany, 36, of Thornwood, N.Y., is a senior who attends Manhattan College, Riverdale, N.Y., pursuing a degree in Civil Engineering. He is the son of a member of Carpenters Local 279.
Giuliana Piazza, 19, of Valhalla, N.Y., is a sophomore who attends Ohio State University in Columbus, and is pursuing a degree in Chemical Engineering. She is the daughter of an executive of a BCA-member company John Piazza, Inc.
Joseph Piazza, 18, of Valhalla, N.Y., is freshman who will be attending the University of Miami, Coral Gables, FL, pursuing a degree in Engineering. He is the son of an executive of a BCA-member company John Piazza, Inc.
Anthony Sanseverino, 20, of LaGrangeville, N.Y., freshman, who will be attending Georgia Institute of Technology, Atlanta, GA, pursuing a degree in Civil engineering. He is the son of a member of the International Union of Operating Engineers Local 137.
For additional information and to request an application for next year’s grants opportunities, please contact Laurel Brunelle at 914-631-1033 or firstname.lastname@example.org.
Route 17 Third Lane Project Could Cost as Much as $1 Billion
POUGHKEEPSIE, NY — The cost of adding a third lane on a 47-mile stretch of Route 17 from Harriman to Monticello in each direction is now being estimated at anywhere from $525 million to as high as $1.04 billion, depending on the scope of the improvements to be undertaken.
The latest project cost estimates were revealed at the third public workshop of the New York State Department of Transportation’s Route 17 Planning and Environmental Linkage (PEL) Study Group held virtually on Sept. 14. A final report that will include recommendations to move forward is expected to be released at the end of next month.
NYSDOT officials and study consultants who authored the Route 17 Draft PEL Study have initially recommended moving forward with four alternatives: No Build, which is required for any future project-level National Environmental Policy Act (NEPA) review within the Route 17 corridor; General Use Third Lane Alternatives; Interchange (Improvement) Alternatives and Alternatives to Improve Connectivity to Mass Transit.
The PEL Study Group did not recommend moving forward on a High Occupancy Vehicle Lane, Light Rail and Bus Rapid Transit alternatives. The report included in-depth traffic analysis that identified current and projected traffic choke points as well as environmental impacts.
Mark Tiano, PE, NYSDOT Project Manager for the Route 17 PEL study, acknowledged that if the Route 17 project were to advance as a “mega project” that the cost could run as high as $1 billion. In the question and answer session of the hearing, Mr. Tiano said that the PEL Study Group has looked at the entire corridor and has not considered any limit or reduction in the length of the project.
Consultant Rebecca Novak, civil department manager at WSP USA’s office in Valhalla,NY, said, “If the entire thing (adding a third lane) was set as a major project to go out tomorrow based on our estimate, which of course it is not, then the total would be about $1 billion. But, we are just trying to identify the range of costs for the range of alternatives and it is going to be progressed in smaller pieces to meet the demand of future traffic and as the budget allows.”
She noted that the final PEL report that is expected to be released at the end of October will look to prioritize projects to be included in future NYSDOT capital plans.
The PEL Study offered two alternatives for the General Use Third Lane, a less expensive Option 1 that would cost between $12 million to $16 million per mile and cost $310 million to $420 million for work on the roadway’s length in Orange County and $215 million to $290 million from the Sullivan County line to Monticello—putting the total project cost range between $525 million to $710 million.
The more-costly Third Lane Option 2 would cost between $16 million to $20
million per mile to complete and would cost $420 million to $720 million in Orange County and $290 million to $320 million in Sullivan County, putting the total cost range between $710 million to $1.04 billion.
The NYSDOT PEL Study also lays out a host of interchange improvements in both Orange and Sullivan counties that run the gamut in cost from approximately $1 million to as high as $43 million each. The cost ranges for all of the interchange improvements in Orange County are between $120 million to $150 million, while the projects outlined in Sullivan County came in between $40 million to $70 million.
The need for a third lane on Route 17 has been fueled by development all along the corridor. The report noted, “It is projected that traffic congestion on Route 17 will worsen over the near-term and long-term planning horizons as a consequence of projected population growth and development within the corridor.”
While growth rates have declined from their peak in recent years, it is estimated that the population of Orange County will reach 521,000 by the end of 2050, an increase of roughly 145,000 over current levels. “Congestion is also anticipated to worsen in the future as a consequence of new development in both Orange and Sullivan counties, including the Center for Discovery expansion, the Amy’s Kitchen factory and warehouse, the Yidel Weiss warehouse, the Presidential Container Group manufacturing expansion, the Medline warehouse relocation and expansion, the Woodbury Common Premium Outlets expansion, and several other potential retail, hotel, and warehouse projects in various stages of development,” the report stated.
A coalition of business and civic organizations called 17-Forward-86 has been advocating for NYSDOT to approve and secure funding for a third lane on Route 17 in both directions in Orange and Sullivan counties to accommodate the significant economic growth in the region.
The group has lobbied federal and state lawmakers to include funding for the Route 17 expansion in the massive infrastructure bill now being debated in Congress with the belief that the Route 17 third project would come in at approximately $500 million.
John T. Cooney, Jr., executive Director of the Construction Industry Council of Westchester & Hudson Valley, Inc., said, in reaction to the higher cost estimates for the Route 17 expansion, “As with all major regional infrastructure initiatives to improve our public facilities, total project cost is based on many factors and always subject to the construction market at hand. All price estimates to date for the Route 17 improvement project have come from federal and state research reports and not the 17-Forward-86 coalition.” CIC is a Founding Member of the 17-Forward-86 Coalition.
He continued, “The PEL Study (planning and environment linkages) is updating cost estimates from NYSDOT’s 2013 corridor study, using revised traffic and economic data—including supply-chain shortages and material cost increases—and other measures to address the corridor’s needs. It’s also important to note that the updated costs indicate the third lane ‘could’ be built through Orange and Sullivan counties for a little over $500 million.”
Mr. Cooney said that while major cost increases are never easily palatable, the concept of adding a third lane is a project that has lingered since 1998. “We cannot ignore all the benefits this project will bring to the Hudson Valley. Beyond safety, enhanced mobility, less congestion and air-quality improvements—there is the powerful economic multiplier effect that shows the entire region benefiting from the project by as much as five times the project’s actual price tag,” he said.
The PEL process is being initiated by the NYSDOT in cooperation with the Federal Highway Administration. The DOT last year began a scoping and preliminary review process as part of the $5-million PEL Study, whose funding was secured through the 2018-2019 state budget.
The PEL Study is a follow-up to a NYSDOT study released in May 2013 that examined the corridor between Monticello, Exit 103 (Rapp Road) and Harriman, Exit 131 (New York State Thruway) to help accommodate transportation demands brought about by economic growth in the region and to help accommodate future growth.
The final report recommends: adding a general use third lane, in each direction, from Interstate 87 in Harriman to just west of Middletown, Orange County; improve key interchanges in Orange and Sullivan counties; provide new and expanded park and ride lots at strategic locations in Orange and Sullivan counties and recommend some provisions for future transit.
Westchester IDA Approves Incentives For Projects Valued at $755 Million
WHITE PLAINS, NY — The Westchester County Industrial Development Agency on Aug. 26 in a session that lasted less than 12 minutes, voted to grant incentives totaling $14.7 million to two major projects in Greenburgh and White Plains valued at a combined total of $755 million.
The IDA Board unanimously (5-0) approved granting $7.7 million in sales tax incentives for the $480-million expansion project by Regeneron Pharmaceuticals in the Town of Greenburgh. In another unanimous vote, the IDA Board approved a final resolution granting the developers of the Gateway II mixed-use project in White Plains $5.36 million in sales tax exemptions and $1.65 million in mortgage recording tax exemptions in connection with their $275-million project to be developed at 25 Lexington Ave. in Downtown White Plains.
The only discussion during the IDA session centered around the Gateway II project and the contention by the developer— GS White Plains Owner, LLC, which is led by Greystar Real Estate Partners and the Alaska Permanent Fund, and its general contractor that it could not fully abide by the IDA’s recent local workforce hiring policy.
IDA Chairperson Joan McDonald said that after the IDA approved the preliminary inducement of the project at its June 24 session, the county and the IDA worked with the developer to hire more local labor. The county held a Construction Career Fair on Aug. 23 at the New York Power Authority building in Downtown White Plains where approximately 200 potential job applicants attended the three-hour event. General contractor LRC Construction and a number of sub-contractors were on hand looking to fill positions for two major projects: Gateway II, which will involve the development of 500 housing units and The Mitchell—a mixed use luxury development on the corner of Mamaroneck Avenue and East Post Road currently under construction. Both developments are located in Downtown White Plains. Available job positions included: Laborers, carpenters, plumbers, drivers, electricians, sheet rockers, building maintenance, security, masonry, and more, the county stated in its announcement.
Ms. McDonald said at the IDA session that in June she committed that the county and the IDA would work with the developer, the general contractor and others “to help promote the project and encourage as much local labor as we could to increase the numbers that were in the resolution.”
She added that based on the interest at the Construction Career Fair, which was attended by Westchester County Executive George Latimer, the event “shows how the IDA and the county can work with our developer community, with the building trades, with our local governments to get as many people in Westchester County and the immediately surrounding communities employed in good paying jobs.”
It should be noted that labor representative on the IDA Board, Richard McSpedon voted against the Gateway II incentives back in June due in part to the workforce modifications, but voted in favor of the incentives at this morning’s session.
The proposed Gateway II project seeks to redevelop an existing surface parking at 25 North Lexington Ave. into a 500-unit, 25-story residential apartment building. The project includes 19,000 square feet of ground floor retail and 755 parking spaces (626 serving the project and 129 spaces dedicated to the adjacent Gateway One office building, which is owned by the Alaska Permanent Fund.
The mix of apartment units includes 167 studio units, 208 one-bedroom units, 117 two-bedroom units, and eight three-bedroom units. A total of 15 on-site units will be classified as affordable in compliance with the city’s Affordable Rental Housing Program Regulations in addition to a $3.8-million contribution to the City of White Plains’ affordable housing contribution fund.
The Regeneron project is an expansion of its “Parcel D” project originally proposed in 2015 as a building not to exceed 192,000 square feet that secured Westchester IDA approval, but never moved forward.
The amended incentives application with the IDA approved by the agency calls for the construction of a new two-story, 207,940-square-foot building, along with a parking structure and other infrastructure that will increase the development cost of the original project (including equipment) by approximately $331 million to $480 million.
Regeneron estimates that construction costs will total $310 million, design costs $21.7 million and FF&E (furniture, fixtures and equipment) $148.9 million. The cost of the original project in 2015 was estimated at $150 million.
The new building will primarily house Regeneron’s pre-clinical manufacturing and process development operations.
At the Westchester County IDA’s July 22 meeting, Regeneron Pharmaceuticals representatives told agency members that it expects to come before the agency “very shortly” with another major new development project in the Town of Greenburgh.
Although Regeneron representatives did not provide any details on the new project at that session or again at the Aug. 26 meeting, its representations at the July session pointed to a parcel of land where the firm has previously secured approvals from the Town of Greenburgh for the construction of a group of buildings that could total approximately 1 million square feet at 555 Saw Mill River Road.
Return to Live Meetings - 11th Annual CAI Seminar To Award Six Credits for Professional Engineers
TARRYTOWN, NY — The 11th annual program entitled “Construction Solutions for Engineering Designs” for professional engineers will be held Wed., Oct. 6, at Abigail Kirsch/Tappan Hill Mansion here. The program earns P.E.s a total of six professional continuing-education credits from the Construction Advancement Institute of Westchester & The Mid-Hudson Region, Inc., (CAI). The announcement of the seminar was made by CAI Chairman Mark Fante, vice president of Darante Construction Inc.
Attendees will earn six professional development/HSW hours from the American Institute of Architects (AIA). The health safety welfare credits are also recognized by the New York State Department of Education for P.E.s, Mr. Fante explained.
The six topics at “Construction Solutions for Engineering Designs” are: Modern Concrete Repair Technology; Reducing Engineering Liabilities; BIM, 3-D modeling and Steel Design; Subsurface Exploration for Foundation Design & Construction; Construction Dewatering; and Building Compartmentalization Utilizing Fire-Resistive Materials.
The six guest speakers at the seminar will be: William Lyons III, FACI, who is
National Business Development Manager, North East of The Euclid Chemical Company; Thomas H. Welby, Esq., P.E., of the law firm Welby, Brady & Greenblatt, LLP; Michael J. Squarzini, P.E., who is Managing Principal of the engineering firm Thornton Tomasetti; Alfred H. Brand, P.E., D.GE, who is Technical Specialist at Mueser Rutledge Consulting Engineers; Matthew Cichetti, P.E., Principal, Cichetti Engineering/Earth Construction Services; and Jonathan B. Wohl, principal of Wohl Diversified Services.
“Registration will be limited to 40 professional engineers of any discipline,” Mr. Fante said. The non-refundable registration fee of $125 includes all activities and lectures for the daylong program, which include a business luncheon. CAI officials strongly recommend engineers to register early. Space is limited and available on a first-come basis. The CAI is affiliated with the Building Contractors Association of Westchester & Mid-Hudson Region, Inc.
“Construction Solutions for Engineering Designs” on Oct. 6 will be held at Abigail Kirsch/Tappan Hill Mansion, located at 81 Highland Avenue in Tarrytown, NY. Registration and Continental breakfast will begin at 7:30 a.m. and is scheduled to conclude at 3:30 p.m.
For more information and registration, contact CAI Program Manager Laurel Brunelle at (914) 631-1033 or email@example.com.
Dominican College Honors IBEW’s Sam Fratto As ‘Person of the Year’ Oct. 17 in Old Tappan
ORANGEBURG, NY – Dominican College will honor two local business leaders—Sam Fratto, Business Manager of IBEW Local 363, and Larry Weiss, president and CEO of Atlantic Tomorrow’s Office as Persons of the Year—at the 48th Annual Grand Reception. The gala will be held on Sunday, Oct. 17, 2021, at 12:30 p.m.at the Old Tappan Manor in Old Tappan, NJ.
“We are so pleased to announce that this year we have two outstanding honorees who were chosen for their professional leadership, community involvement, and philanthropic works,” said Dominican College President Sr. Mary Eileen O’Brien, O.P., Ph.D.
Mr. Fratto was appointed Business Manager of Local 363 by the Executive Board in 2011. He has since been elected by the membership three times, twice without opposition. His appointment as Business Manager of Local 363 came 33 years after he first joined the electrical trade as an apprentice with IBEW Local 631, one of three local unions that later merged into a bigger and stronger IBEW Local 363 that covers the entire Hudson Valley.
Under Mr. Fratto’s leadership, Local 363 has supported many community organizations, including the Boy Scouts, United Way, United Hospice, Child Care Resources of Rockland, Helen Hayes Hospital and Jawonio. He has been recognized nationally by the IBEW for his work within his local union and the Hudson Valley. In addition, he has been honored by the Rockland Business Association, Good Samaritan Hospital, and the Hudson Valley Labor Federation.
In 1982, Mr. Weiss rescued Atlantic Photocopy from bankruptcy and what was a staff of five is now more than 400 strong. Atlantic Tomorrow’s Office is an Office Technology and IT Solutions company providing services to small and mid-sized businesses in New York, New Jersey, and Connecticut, as well as the Greater Philadelphia area and the Delaware Valley.
Mr. Weiss has fostered a spirit of philanthropy at the company and donated his time to many organizations. He is a board member of the National Kidney Foundation and St. Christopher’s Inc. He sits on the Advisory Board of Bridges of Rockland County and is an enthusiastic supporter of the Jillian Fund, Englewood Hospital, the Fresh Air Fund, Cooley’s Anemia Foundation, the New Jewish Home and United Hospice of Rockland County, in addition to other organizations.
Proceeds from the Grand Reception will go toward student scholarships, academic programs, and campus improvements. Tickets can be purchased online at. https://www.dc.edu/events/grandreception2021/. For additional information, please contact Mary Lichtman at 845-848-7406 or firstname.lastname@example.org.