This game has many variations, but one of the worst is the basic game of change orders.As a subcontractor, you are into the job and the scope changed or the drawings were finally completed and you were finally able to get the shop drawings completed. It took longer because the owner’s rep or the designers could not or would not make a decision.Sometimes you have to submit a change order to help you cover the additional work that was necessary to meet the revisions. You submit them to the General Contractor as scheduled and a week later get a denial in no uncertain terms.
March 16, 2017
When I was in grade school, we used to play “Crack the Whip” where one boy would act as an anchor and 5 or 6 other kids would form a chain, hold hands and begin to run usually counterclockwise. As the speed began to pick up the kid at the end of the line would go flying into the air usually taking a nosedive into the turf. I was a skinny kid and usually ended up flying through the air, fun until gravity played its role.Later, as a teen at the roller rink or on the ice, we played the same game with the person at the end of the whip speeding at an incredible speed, but sometimes ending up being slammed into the boards. You get the idea I’m sure. The person at the end of the chain takes the brunt of the blow. This might be a fun game to play as a kid, but tough on the person at the end of the whip, especially when it is you. Crack! Bam! Boom!General Contractors play this game with higher division subs when it comes to scheduling.
March 14, 2017
According to the Northern District of Georgia, a second construction company owner has been charged with conspiring to pay bribes for City of Atlanta contracts.We previously reported that Elvin Mitchell, the owner of one of the largest minority contractors in Atlanta, was indicted for bribing city officials with over $1 million as a way to gain $10 million in City of Atlanta contracts. He pled guilty to those charges.Now, a second contractor, “Charles P. Richards, Jr., has been arraigned on conspiratorial bribery charges for paying over $185,000 to obtain City of Atlanta contracts.”
February 22, 2017
Millennium Tower in San Francisco is still leaning. We called it the Leaning Tower of San Francisco in an earlier post when we explained that the tower, completed in 2011, has sunk about 16 inches after six years, two times the amount expected over the 50 year life of the project. It is leaning 2 inches.It is built over landfill, and in an apparent effort to reduce development costs, the piers under the building do not reach bedrock. Additionally, an adjacent transit station being developed has been accused of contributing, if not causing, Millennium tower to lean.
February 17, 2017
You might think that your company or jobsite is secure and protected from risk. Don’t bet on it. If you think that you have everything covered and you have shifted your risk, think again. Whatever you might be doing to protect your company, the potential risk is much higher than you might think. We took a look at the Kroll Global Fraud and Risk Report and found that the stats were shocking.According to the 2016/2017 Kroll Global Fraud and Risk Report, 82% of executives surveyed reported that they had an incident of fraud over the previous 12 months. The report, which examines major global theaters and industries, found that most responding companies have seen an increase in fraud, cyber and security breaches.The study, completed by Forrester (Nasdaq: FORR), “one of the most influential research and advisory firms in the world,” includes “10 in-depth interviews and an additional online survey with 545 senior executives worldwide across multiple industries.”
February 08, 2017
It is a game almost older than dirt, a “table stakes” game. Every contractor or sub has been tempted to play the game at one time or another to win a project. It is commonly known as “the grey bag,” or “this is the way it is played here,” or “I know that you are not the lowest, but…” or “if you will hire this consultant on the project, I will guarantee that you will get it,” or “if you will hire my cousin’s company as a sub on this project or that one, then I will help you get the project.”The legal profession knows it as “bribery” and even though it continues on projects around the country, the downside risk if you play is considerable.Two recent examples caught our eye. The first was reported in the Houston Chronicle. It involves a former Houston Independent School Board member and Chairman who, along with his co-defendants, were convicted of “tortious interference in a business relationship, bribery, conspiracy and a violation of the RICO statutes." The game involved collusion among the trustee, a contractor and a “consultant” to block the plaintiff’s attempts to get work from the school district. The game was that in order to get work, the bidder had to hire the consultant and pay fees.
February 03, 2017
There is a saying that “Things are Bigger in Texas.” Whether we Texans just brag about it or whether others expect it from us, that is the myth.Not on supertall buildings.The latest report from The Council on Tall Buildings Council and Urban Habitat (TCBUH) on the supertall buildings completed over the last year titled 2016 Another Record-Breaker for Skyscraper Completions; 18 “Tallest Titles” Bestowed lists China, not Texas or even the US, as the country completing the most buildings over 200 meters or 656 feet tall. While second on the list of completions, the US was not even close.According to the report, there were a total of 128 buildings completed in 2016 and China far outstripped Texas and the US with 84 completions to a paltry 7 in the US. South Korea followed with 6, Indonesia with 5 and the Philippines and Qatar tied at 4. In terms of combined height, according to TCTBUH, China completed 30,301 meters or 99,413 feet of tall buildings. Stacked end on end, that would be 18.8 miles high. That is pretty tall and enough to give the Chinese real bragging rights in that category.If you look at the various charts in the report, and they are eye opening, you will see that the latest round of completions brings the leader China to a total of 500, followed by the US at 187, the Middle East at 137 and Europe at 47 buildings over 200 meters high.
January 27, 2017
A recent post by Joe Paduda, principal of Health Strategies Associates, in his blog, Managed Care Matters, titled “Construction Labor Fraud is Screwing Everyone” was the second in his series on labor fraud and the damage it is doing to the insurance industry. In this issue, he interviewed Matt Capece, representative of the General President at the United Brotherhood of Carpenters and Joiners of America, about how bad the worker’s comp problem has become in some key states like Florida, Georgia, Colorado, Oklahoma and Tennessee.Capece said, “When we go onto jobsites in Florida, on 8-9 out of 10 sites we hear from carpenters that they are getting paid in cash.” He indicated that subs and labor brokers in Florida are paying in cash with no overtime or any other benefits like vacation, worker’s comp or training. Usually they are also misclassified as independent contractors as well.
January 17, 2017
Emily Peiffer, the editor over at Construction Dive, recently posted a feature article titled 10 Construction Trends to Watch in 2017. Since hers is one of the first of 2017, I thought that we would share the list and give you the link so that you can take a deeper dive into the list at your leisure. Here is Emily’s provocative list.Collaborative project delivery methods will become more popular.The labor shortage will continue to plague the industry.The feeling of uncertainty will linger under the new administration.Offsite/modular construction will gain a stronger foothold in the market.Construction firms are cautiously optimistic for a future infrastructure-spending boost.
January 09, 2017