41/ Construction Industry Bound ThbIe BOARD oF DIRECT0RS Ch^irmaa, Linda Figg Pr€side & C EO, Figg Engrneenng Group Viee Ch^ftma\ Robett E. Algel CEO & President, he La ne Construction Corp. T reasnrer, Patrick Mocleamy CEO, HOK Croup, nc. Prst Chairman, Matt ew M. Walsh CEO, The Walsh Crroup President, ugo Consultants, nc. Presidenl, CDM Willian B. Frasel CEO, Carlson roup, nc. Thonas F. Gilbane, Jr. Chainnan CEO, Gilbane uilding Company Charles L. Grcco President & CEO, LINBECK Da ald F. Greenwood President, Bums & McDonneli Construction Bruce E. Grewcock President CEO, PeterKiewit ons'.Inc. Craig L. Martin President, acobs Engineering Group A. Ross Mye6 Presid€nl, Amencan nfiastructure, nc. Patficia A. Rodgerc President, odge6 Bulders Chajrman CEO, Sarge &LundyLLC Douglas E. Woods Presideni,PR Construction. nc. Mark A. Ca.so. Esq. 8ll5 Old lomnrion r.. Suite 10 M.l.eD, \'A 22102-2325 l'h.,x,:202 66 6i77 $/.b Site: Ltr\t.{irt.,trg January , 2011 Th e Honorable arrell . ssa Chairman U.S. House f ReDresentatives Committee n Oversight nd Government eform 2157 Rayburn ouse ffice uilding Washington, C 20515-6143 Dear hairman ssa: On behalf f he Construction ndustry ound able CIRT)1, e wish o thank ou or equesting he Round able's articipation n he critically important ffort o dentify xisting nd proposed egulations ha t have r may negatively mpact growth n our ndustry. "Time s money" oth axiomatic nd rue n he design nd construction industry which emains eavily abor ntensive o his day. So, f something akes more i me t cost ob s . . thus, egulatory elays, redundancies, nefficiencies, nd ed ap e collectively ave direct mpact on costs nd herefore he vitality nd ability f our ndustry o remain profitable nd hire more eople. Even he American ublic as ome o his onclusion, it h n overwhelming 1 percent greeing hat he government needs basic overhaul" nd hould ndertake an annual spring cleaning'to liminate unnecessary egulations nd ed ape." ccording o a recent Glarus Research roup oll Dec. 010). Desiqn nd Construction ommunitv The design/construction ommunity's'can-do-spirit" nd know-hovf' till exists, t' s ust hard in d nder h e mountains f aws, egulations, nd ules that we nsist n heapingnto our private ector ob creators nd hen expect hem o spur economic roMh nd employment. ot only s he existing a ss urdensome which n e might all th e egulatory omplex"), the uncertainty nd unintended onsequences fwhat appears o be a never nding xpansion f government's each as also done evere damage o he entrepreneurial pirit nd isk aking both necessary o jump start robust ecovery. 1 The Construction ndustryRoundTabto CtRn stives to qeate one voice ta meet the intercst and needs of the design and construction connunity. C|RT suppotts ts menbers by actively reprcsenting he industry on public policy issues, by imprcving he inage and prcsence of its leading nenberc, and by providing a forum fot enhancing andlor developing strcng nanagenent apprcaches n an everchanging envircnnent through ne twotuing and peer interaction. The Round Table s conposed of approxinately 100 CEO, frcn the eadingarchitectural, enginee ng, and consttuction inns n the United Sfates. Iogeibe,'fhese frrms delivet on billions of dollar, of public and pivate sectot nfrastructurc proj&ts that enhance he quality of life of all Aneicans while dl@glu enploying half-nillion Aneicans.
Transcript
8/7/2019 Construction Industry Round Table Letter to Chairman Issa - January 6, 2011
Bruce E. GrewcockPresident CEO,PeterKiewit ons'.Inc.
Craig L. Martin
President, acobsEngineeringGroup
A. RossMye6
Presid€nl,Amencan nfiastructure, nc.
Patficia A. Rodgerc
President,odge6Bulders
Chajrman CEO,Sarge &LundyLLC
Douglas E. Woods
Presideni, PRConstruction.nc.
Mark A. Ca.so. Esq.
8 l l5 O ld lomnr ion r . .Su i te 10
M.l .eD, \ 'A 22102-2325
l 'h . ,x , :202 66 6 i77
$/.b Site: Ltr\t.{irt.,trg
January,2011
TheHonorablearrell . ssaChairman
U.S.House f ReDresentativesCommitteenOversightndGovernmenteform2157Rayburnouse ffice uildingWashington,C 20515-6143
Dear hairmanssa:
Onbehalf f heConstructionndustryound ableCIRT)1,ewishothank ou or equestingheRound able'sarticipationn hecriticallyimportantffort o dentify xisting ndproposedegulationshathave rmaynegativelympactobgrowthn our ndustry.
"Times money" othaxiomaticnd rue n hedesign ndconstructionindustry which emains eavilyaborntensiveo hisday. So, fsomethingakesmoreimet costobs . . thus,egulatoryelays,redundancies,nefficiencies,nd ed apecollectivelyave directmpactoncosts nd hereforehevitality ndability f our ndustryo remainprofitablendhiremore eople.
EvenheAmericanublic as omeo his onclusion,ith noverwhelming1percentgreeinghat hegovernmentneeds basicoverhaul"nd hould ndertakeanannualspringcleaning'toliminateunnecessaryegulationsnd ed ape." ccordingo a recentGlarusResearchroup oll Dec. 010).
Desiqn nd Construction ommunitv
Thedesign/constructionommunity's'can-do-spirit"nd know-hovf'tillexists,t' sus thardind nderhemountainsf aws,egulations,nd ulesthatwe nsist nheaping ntoourprivateectorobcreators nd henexpecthem o spureconomicroMh ndemployment.otonlys heexisting ass urdensomewhichnemight all the egulatoryomplex"),theuncertaintyndunintendedonsequencesf whatappearso beanever nding xpansionfgovernment'seach asalsodone everedamageo heentrepreneurialpirit nd isk aking bothnecessaryojumpstart robustecovery.
1 TheConstructionndustry Round Tabto CtRn stives to qeate one voiceta meet the intercstand needsof the design and constructionconnunity. C|RT suppotts ts menbers by actively
reprcsenting he industry onpublic policy issues,by imprcving he inage andprcsence
of itsleadingnenberc, andby providinga forum fot enhancingandlor developingstrcngnanagenent apprcaches n an everchangingenvircnnent through netwotuingandpeer
interaction.
The Round Table s conposed of approxinately 100 CEO, frcn the eading architectural,enginee ng, and consttuction inns n the United Sfates. Iogeibe,'fhese frrmsdelivet onbillionsof dollar, of publicandpivate sectot nfrastructurcproj&ts that enhance he qualityoflife of all Aneicans whiledl@gluenploying half-nillion Aneicans.
8/7/2019 Construction Industry Round Table Letter to Chairman Issa - January 6, 2011
Theprocessf designingndconstructings oneof man'smost omplex nddauntingndeavorsitoftens hemeans ywhichwemeasurehesuccess f anentire ivilizationtowit, he ruins" fancient orlds re ypicallyiewed s howadvanceheywereor how esourcefulnd asting).Partof hecomplexitys henumber fpartiesnd nterestedlayershatmayhave handnor nfluenceoveragiven roject,dd o hat henumber f ayeredurisdictionsfederal,tate,ocal, tc.); ndonebeginso understandhemyriad laces ndopportunitieshere elay/redundancyancreepinto heprocesshrough nnecessaryed ape.
Thisprocessasbecomerofoundlyore omplicated,srecently otedn he CivilEnoineerELOG:[t]he nvironmentalrotectionovementascontributedo heuncertaintyorconstructionbecausef he nabilityo knowwhatwillbe equiredndhow ong t will ake o obtain pprovalromthe egulatorygencies.he equirementsf continuede-evaluationfproblemsnd he ackofdefinitiveriteria hich reoracticalave lso esultednadded osts."
While xamplesf red apecanbe ound nprocurementf services,nvironmentalequirements,
public afety,inancialequirementsFinReg),rojectelivery,aymentystems, enefitmandates(healthare eform), ndcountlessther reas theyall hold ome hingsn common:ackofuniformity,edundancy,nd nefficiencies.
(A)Streamlininq"Asa people ehave hoseno unctionnder politicalystemhatpromotesiversityfgovernmentaluthority,ndstructure. s a result, e have evelopednationalegulatoryystemwellmeaningn ts ntentions,ut ayered ndoverly omplex.Oursocial urposes, issions,ndpublicnterestsften ompete, ithour44,000urisdictions,ll50states, everalerritories,nd hefederal overnmentach mending,dopting,nterpreting,ndenforcingivemajor etsofconstructionodes ndover2,000echnicaltandardsoverninghesit[e election],esign, ndconstructionf bu,idlngsNOTE:ust buildings"s being onsideredere in otherwordsverticalconstruction"not oads, ridges, nvironmentalemediation,tc.etc.)." See,NCSBCSnd ts54
And hecost f red ape anbe substantial.heAlliance/FIATECHroject as oundhat ncreasingtheefficiencyfmodern onstructionodes,ules, nd egulationsswellas reducingheamount ftime t akeso move newbuilding r buildingenovationhroughhe egulatoryrocessyasmuchas60%annually,analso aveboth heprivate ndpublic ectorsensof billions f dollars.
When xtrapolatedo he ullconstructionarket,hestudy oteshat:
'zfhe Environmentatrctection gencyEPA)hasongbeena source f rcgulatorynefficiencynd costs.Almost0yearsagoL,A!9Lfut9pbSUoL 59,No.1, ebruary 983)publishedn afticleentitled:lnpactofRegulatory elays n he Cnst fWastewaterreatment lants" yKisla S. Reed ndC. EdwinYoungwhich ointed ut hat"Thecd tapenec$sary o neettheEPA cquiementsrequently elays he s&,ttol constructionanaverage l2 to 4years.'E @page35.
3TheNational ,onfetencef States nBuildingCodes nd Standards,nc. NCSBCS)aswo*ed over heyearswith edeftlagenciesndpublicandpivate sector ryanizations,ndhasnowoinedwith heEl![EPL!:3reA0]i0qgepi@ and heStateand Local overnmentuppod ctivities f Robeftwible& Associates ithagoal o rcduce he amount ftime t takes o movebuildingshtoughhe egulatory ystenby asmuchas 60%.
8/7/2019 Construction Industry Round Table Letter to Chairman Issa - January 6, 2011
Regutatoryosts lOok f he Annual$1.0rillionn tJ.S.Constructionr$100Billionn costs.a
BUT, venwith hese normousavingsmuch,f notall, J hepurposef hese roceduresouldbeaccomplishedithoutheunnecessaryelays ndcosts' that's otusta theory, uta factproven y heexperiencesorneromprojectscrosshecountry hen ime s of heessence.
(B)Contrastino roiectExperiencesThere reanynumber f examplesndexperiencesver heyearswherewecan ocus n heclearunmistakableessons e've earned ndput hem o workacrossheboard na myriad fpublicprojectso hatweget hebenefitsfefflcient,cience-based,ndcosutimeensitiveegulationswithoutheunnecessaryndwasteful urdens. rwecan gnorehemandcontinue ithwastefulinefficientrocedures.
. Cuftinq hrouqh edTape EarlvCompletion):fterbarely neyear somehreemonthsahead fschedule)new -35W ri dgetood here ne ragicallyollapsednAug.1 007.
The ldspan arried orehan 40,000ehiclesdayand he oss f hebridge ascosting400,000erday ndiminishedevenue,ncreasedommuterxpenses,ndburdenonsurroundingoads.Businesssusual'andeedlessegulatoryelays ould otbeacceptabler oleratedy hedevastatedommunity. henncentivesxist,he egulationsand ed apecanbeovercome/managedndeliminatedo create notableuccess:heInterstate5Wbddgeeplacementroject ascompletedarly/belowudget ndwasawardedmerica's ransportationwards' randPrizeor 2009 y heAmericanAutomobilessn.,heAmerican ssn. f StateHighway Transportatlonfficials nd heU.S.ChamberfCommerce.RESOURCE:inda igg, iggEngineeringroupFL)l
. Tvoical roiect elavs: heprojecto rehabhecity of chicago'sRedline"andbring t o astate fgood epair, n tsexistingight way whichs currentlyn disrepairnd falling
" The Alliance d@unented the savings ron streanlining and use of lT methods or buildingprcjects and then applied t to
2007 Construdion Data (today,constructionspending s down to apprcxinately $810billion, of whichabout$256bi ion is innon+esidenti l bu lding).
5TheAlliance/FIATECHweb slte rofes:
'lhlsis not about cgulatory abandonnent! This s aboutspending bothgovemment
andpivate sector dollars wisely."
By 2007, the study found vast savings ton seeningly sinply efficiehciessuch as:(1) e-Pemit tuocessingnow used n over fio juisdidions acrcss he nation Enging in population rcn Los Angeles(3,695,000)o Cobleski NY (5,300) cduce &aff and building owner/architect ines to ppcess pemits by between 30 - 40%;(2) lntenctive Voice Resporse(/yR) sysiems,, Shelby Co., TN;Orlando,FL and Washingtonco., oR reduce the time toscheduleand conducl inspedions rcm 2-3 days to less han 24 hours; (3) Mobile ield inspection echnologybeing used ncities ncludingPhoenix,AZ: SanDimas,CA incrcasethe nunbet of inspectionspeiomed pet day by 25% and rcducecontactot down ime waiting or inspectionsand their rcsultsby 20%; (4) e-Plan Review now being conducted n: Atlanta, GA;Bend, OR; Madcopa Co. AZ; OsceolaCo. FL and a dozen other uisdidions rcduce the amount of time t takes to reviewplansby 40oA, lininate lost plans,and rcduce by 80% he nunber of tips to theseuisdictions by out of stateownergarchitects;and (5) strcamlinedprccessesarc geftingbuildings up and open faster,puftingbothpeople to workand
rcvenues nto lheuisdiction's
coffeB soonef fot example a 200 toon hotel openjust
3 monthsearlier using strcamlinedptocesseswithan 800/6 ccupancy= $144,000 n added ax rcvenues o a urisdbtion just fton the 10o/o ccupancy ax on$111/nightroons.
8/7/2019 Construction Industry Round Table Letter to Chairman Issa - January 6, 2011
(C)Procedures ProcessHiddenn anydiscussionf regulatoryastes heproceduralndprocessurdenor paperwork")hat ypically ccompaniesny ules.Examplesf hisprocessrebothuniversalnapplicationndoften imes nique r specifico ndustryroups nd/oregulatedreas. hesames rue or hedesign/constructionommunity.
. CompliancendPaperWorkCosts/Delavs:omewhatniqueo heA,/E/Community,hefederal genciesppearo be beefing-up"ndhiringull-timetafferso assigno argeprojectsnvolvingo-calledstimulus"funds,wtrereheyare equiring onthly versightmeetingso ensureomplianceith ederaluidelines.heSanDiego ourthouses n hecategoryf sucha "mega-project"over 100M):ontractorsredevoting number fpeopleand esourceso make ure heyare n completeompliancethepaperworkequiredsakin oa monthlyederaludit.
Regulationsave otbeen ltered rastically,utchances f being udited ave ncreasedand uditso agreaterepth ave een romised.heOFCCP,n act, as liminatedheir"desk udit" rocedurendhavemovedo more ggressiven-depthn-site uditingrocessacrossheboard this hen equiresreater reparationorpotentialudits n hecontractors'art nanticiDationf henotificationetter r knock n hedoor.
. ProcurementulesorConstructionroiects: nother xample f regulatoryulemakinghathasa directmpact ncosts/timeelateso procurementroceduresorA,/E/Crojects:
D Useofproject Labor AgreementsPLA)on FederalConstructionProjec6: fhenew uleseekso mplementresidentbama's xecutive rderNo.13502Feb.6,2009), hichor he irst ime stablishespolicy f'encouraging'ederalgenciesto considermposingnion-onlyLA's n ederal onstructionrojects hoseotalcosts xceed25million. esidesheobviousotentialandikely)mpact nincreasingostsor ederal rojectswhichmeansessproiectsanbe nitiated),heproposallso nd unsCongressionalandatesnd aws."RESOURCE:enBrubeck,BC [email protected])l
> RedefininglnherentlyGovernrnentar":neof hemore erniciousxpansionsfgovernments tswillful ffortso compete ith heprivateector.To urtherhataim, heAdministrationasundertakenrulemakingrocesso expand nd lip heintent f what s inherentlygovernmental'o as o prevent ork rombeing
contractedo heprivateector. learlyhishasa directmpact n heability f irms
" Theproposalontenplates xpandinghe PLAmandateoprcjectshatdonotditectlynvolvehefederal ovemnent asapafty o the contract) y sinply attachinghe cguircmento the unding.Curently,cases ppeat o restict suchan expansivercading f the NLRI'.Theprcposal lso nbrtercswithCongrcssionalirectionhat ederal gencies hould tive to "obtainfullandopenconpetition" s set otth n the Conpetitionin Contrcctingcl."Moreover,he uleviolates nd gnores U.S.C.e,04CongrcssionaleviewAct)and heREgulatorylexibilih/ cl.
8/7/2019 Construction Industry Round Table Letter to Chairman Issa - January 6, 2011
to survivendmainta-inheirpersonnelf thegovernmentgencyeducesr stopscontractingutwork.'RESOURCE:ohnPalatiello,[email protected])].
> "CardCheck"Thepotentialemains, ithouthevotes nCongresso passchangen he aw elatedo heso-calledCardCheck"egislation,heAdministrationwill urn o heNLRB'sulemakinguthority.ivenheconstructionndustry'saborintensiveature, nd he act t s airlyhighly nionizedatapproximately4.5olo),sucha ruleor regulatoryhange illhave n mmediatenddirectmpact n heconstructionortionf he ndustrv.
ConclusionThe imehascome,f not ongpast,oretfortso ocus nwayso rolFback,unset,epeal, nd/grde-fundheexcessiveregulatorycomplex"hathasariseno newheightsver hepastde-cade."Beyondhesemeasures,hecourtsmayalsoneed oplaya role o reversehe mbalance.'
Short f outrightepeal nd/or liminationf excessiveegulationsnd ules,heaffect fstreamlininghemwhereby ctions redone oncurrentlyndshared mong ndbetweenjurisdictions/agencieso hata projectmaymove orwardna timelymannerevoid f unnecessarydelays ould reatlymproveheability f F|./E/Cirms o complete orkandgainfullymploymoreAmericans.ight ow,dollars llocatedo bespent n hese rojectsresubjecto endlessredundantimeconsumingndoftenwastefululeswhichweigh own fficienciesnddeliveryimes,whilencreasingosts.
To expectheU.S.economyo expand, reateobs,andbecomeobusthroughovernmentinterventionndexcessiveegulations,s o expect omethinghat neyer asandneverwillbe" toparaphrasehomas efferson.
3CIRTs awarc hat henew111 Congressay take-up nunberof proposatshat seeko rcbalancend/oraddrcsshe
rcgulatory omplexhat srcpidlyeplacinghe C,ons,titutionalaEguards nddivisionshatarc he hallna* of oulgovemnentalysten.TheRoundTablesuppotts uch ffodsandcommendshese lotv withsuchsuggestionssput otlhby J.T. Youngo applydeficilcuttingechniquesy creating "Regulatoryudget"hatbeginsoquanw the enomous"hidden
ax'foundn
excessiveegulationsnd ules.See,Viewpoint,p(Dec.
29, 2010)age
Al l].e
L)nfoftunately,he coutts ave been xploited ndusedo expand he cgulatory cach y advocatel hohave used hen(often utside f thei expettise t scientificnowledge sonetimesnfluenced y aullyor even hudulentdata,as n he caseof CO2emissions)ogethvonble rcgulatory utcameshat atexceededhe ulemakingt@essot Congrcssionalntent.Howeverorc rccently,hecouttshavecane dot n hardonsomeexcessivecaches y heFCC in he caseof "netneutrclity' roposedules),EPAf Arcuit enanded he 2009 onstructiontom water ule),and Dol'snandatory il di ingmontoiun whichwasstruck ownas ahitraryandcapicious, s wellaspotentialcpealofpottions f the nassivehealthcarebill.
