March 2008

Eye on Legislation

Reynolds Inc. Reaches to the Rockies with Tierdael Acquisition

D. Brown Management Expands Program for Budding Contractors

J. Fletcher Creamer and Son Celebrates Family Business

Claims Avoidance Program Hit Big in 2007

Compact Machinery for Contracting Collectors

Provider Pals Spark Interest in Waning Construction Workforce

Letters to the Editor

Eye on Legislation
CNA Tracks the Laws and Policies that Effect Contractors

You don’t want to wait for something to go wrong before brushing up on your workers’ compensation info. Arizona, California, Maine, Missouri, New York and Texas all passed new legislation that affects what you are entitled to in the event of an accident. Be sure to check with legal counsel and your insurance policy.

With all the hustle and bustle in Washington, D.C., keeping up on the legislation that affects your company can be a job in and of itself. Luckily, CNA, the seventh largest commercial insurer in the nation, tracked more than 9,000 pieces of legislation last year at the state and federal level and compiled a list of key public policy issues that may affect contractors.

Federal
Terrorism Risk Insurance Act (TRIA) — President Bush signed the Terrorism Risk Insurance Program Reauthorization Act of 2007 on Dec. 26, 2007 — extending TRIA another seven years through Dec. 31, 2014. Insurance losses resulting from the destruction of the World Trade Center and other buildings by terrorists on Sept. 11, 2001, totaled approximately $31.6 billion. The insurance industry does not have the financial resources to sustain repeated losses of this magnitude.

Consequently, TRIA was enacted in 2002 to make insurance coverage for domestic terrorism losses available in the United States. In the event of a major terrorist attack, TRIA provides a federal backstop that allows the insurance industry and federal government to share losses according to a specific formula. The availability of insurance coverage for losses related to terrorist attacks is of particular interest to contractors, as many banking institutions would not fund construction projects in high-risk areas if this coverage were not available.

As a top priority in 2007, CNA specifically met with dozens of members of the House Financial Services and Senate Banking Committees and their staffs to coordinate activities and define go-forward strategies.

Arizona
Workers’ Compensation — A business-labor compromise contained in HB 2195, which was signed into law, increased monthly benefit caps from $2,400 to $3,000 in 2008 and to $3,600 in 2009. Benefit caps thereafter would be increased annually by as much as 5 percent (indexed to the cost of living). These are the first increases in workers’ comp. benefits in nearly a decade. In exchange for the increase, organized labor agreed not to put an anti-business workers’ compensation voter initiative on the ballot and to work on a number of reforms to control system costs in the summer.

California
Tort - A class-action reform measure that would have helped to level the playing field between plaintiffs and defendants, AB 1505, was not allowed to come up for a vote in the pro-plaintiff Assembly Judiciary Committee. As a result, the bill was shelved for the year. The bill would have aligned California with federal and other state courts by giving judges clear statutory rules for handling class action cases.

However, CNA is part of a large coalition of general business interests that backed the bill. A similarly-worded ballot initiative is expected to be presented to the state’s voters next year.

Florida
Auto — A reformed version of Florida’s auto “no-fault” personal injury protection (PIP) law was approved by the legislature and signed into law and became effective Jan. 1. It contains a number of reform provisions.

Key provisions will establish a medical fee schedule for PIP benefits, limit payments to certain types of health care providers and require that all suits on PIP claims for the same injured person that are related to a single provider be joined in a single lawsuit. CNA also believes this will prevent fraud.

Georgia
Liability — HB 136, a construction defect indemnity bill, was passed and signed by the governor. This positive bill makes construction liability contracts unenforceable if they contain language that circumvents public policy. The bill helps to further limit liability on construction defect claims.

Maine
Workers’ Compensation — LD 1107 was signed by the governor. This bill raises the penalty amount from $10,000 to $25,000 for any employer, insurer or third-party administrator that has engaged in a pattern of questionable workers’ compensation claims-handling techniques or has repeatedly and unreasonably contested claims.

Missouri
Workers’ Compensation — SB 668, legislation, which sought to overturn a recent negative Supreme Court decision pertaining to permanent partial disability benefits, failed to pass the House prior to the 2007 adjournment. CNA and others in the industry made a concerted effort to stop the bill and even the Attorney General’s office agreed that the decision was erroneous and ought to be corrected. However, the measure fell victim to disputes over how to address the growing deficit problem of the second injury fund.

New York
Workers’ Compensation — On March 13, 2007, Governor Spitzer signed SB 3322, a workers’ compensation reform and benefits increase bill. Significant provisions include a weekly benefits increase for permanent or temporary partial disability and permanent or temporary total disability from $400 to $500 for injuries occurring after July 1, 2007. Increases will be made annually until benefits reach $600 in 2010, when benefits will be indexed at two-thirds of the average weekly wage in New York. The bill also raises the cap on the maximum number of weeks that a permanent partial disability recipient may receive indemnity payments to as much as 525 weeks, depending on the injured worker’s wage-earning capacity.

The legislation addresses situations of extreme hardship and return-to-work programs and allows up to $1,000 to be spent for certain types of medical care without insurer authorization. In addition, the bill eliminates the Second Injury Fund, which currently accounts for an 11 percent assessment on workers’ compensation policies. The legislation’s promised cost savings will depend in large part on how the law is implemented.

CNA provided significant comments to the governor’s office prior to the legislation, but were excluded from the actual bill’s development. CNA plans to work with other insurer representatives and the insurance department to outline suggestions on how to maximize cost savings in 2008.

Texas
Workers’ Compensation — HB 2004 requires that all reviews of workers’ compensation medical care be performed by a doctor of a similar health care specialty as the treating doctor. The bill’s requirements would apply to all types of workers’ compensation medical cost containment, including peer review, utilization review, independent reviews, designated doctor examinations and required medical examinations.

The bill apparently prohibits medical doctors from reviewing and evaluating the need and appropriateness of chiropractic treatments. This raised a major point of contention for the entire insurance industry, and as a result, the industry sought a veto, but was not successful. The Perry Administration has indicated they will address the situation by rule to include chiropractors.

Reynolds Inc. Reaches to the Rockies with Tierdael Acquisition

The new comany will be called Reynolds-Tierdael. Although Reynolds bought all the assets of Tierdael, it recognizes the value and the history behind the Tierdael name.

Ready to establish a presence in the Rocky Mountain area to complement the existing Lanye Christensen office in Denver, Reynolds Inc. acquired Tierdael Construction Co. (TCC) of Denver on Dec. 31, 2007. Reynolds also believes that this will give it the opportunity to reach into the Southwest.

“This acquisition is consistent with our plans for geographic expansion and will serve as a gateway to other markets,” said Mark Accetturo, executive vice president of Reynolds Inc. “The relationship established through the National Utility Contractors Association (NUCA), my confidence in Jim Stutler, TCC president, and his management staff made this acquisition very easy.”

As Reynolds-Tierdael, the focus of the company will continue to be large water and wastewater projects in Colorado and adjacent states. This acquisition gives the company that Tim Meyer established in 1984 a chance to continue his legacy and be a leader in the utility construction industry.

“The company’s name is Reynolds-Tierdael because Reynolds bought all the assets of Tierdael, but recognized the value and the history behind the Tierdael name,” Accetturo explained. “We thought it was appropriate as well for the employees to have some legacy to hold on to.

“We have offered all employees continued employment with the new company. Operations will remain the same. Tierdael’s ownership gets to retire from the business and meet its financial goals, while ensuring their employees’ jobs and futures. The goal is to grow the business as diligently as possible and to continue the excellent reputation that Reynolds and Tierdael have in the industry.”

“We are excited to join the Reynolds team and have the opportunity to continue our services to our customers, as well as expand our capabilities in the marketplace,” says Stutler.

D. Brown Management Expands Program for Budding Contractors

It’s easier to get by with a little help from your friends. Luckily, D. Brown Management is a contractor’s bestfriend, expanding its Emerging Contractor Development Program to help growing contractors.

While there’s no substitute for hard-earned experience for growing your company, it’s nice to have a helping hand to save you from the common pitfalls of running a business. For those contractors who are looking for a guiding light, D. Brown Management, a leading provider of project management and consulting services for the construction industry, has expanded its Emerging Contractor Development Program.

The program, which was created to bring the experience and resources used by large firms to up-and-coming contractors, will now offer a variety of training classes, peer groups, managed services and an incubator facility to meet the needs of their growing list of clients.

Through the Emerging Contractor Development Program, contractors with revenues of $250,000 to $2 million develop the skills required to develop stronger infrastructure in all areas of their business. The program’s training classes, led by highly experienced industry professionals, focus on helping contractors grow profitably and include sessions on strategizing, financial basics, marketing and people processes, as well as planning and execution.

“Since the inception of the Emerging Contractor Development Program, we have been very successful in providing resources, education and solutions for this truly important segment of the construction industry,” says David Brown, founder and president of D. Brown Management. “The expansion reiterates our commitment to providing quality education and support to contractors who are dedicated to growing their businesses.”

In addition to the training classes, Emerging Contractor Development program participants are offered the opportunity to join facilitated peer groups to share ideas with fellow industry professionals and can augment their training with a variety of managed services designed to help their business grow even more effectively. For more information on the Emerging Contractor Development Program, go to www.dbrownmanagement.com/ecd/.

J. Fletcher Creamer and Son Celebrates Family Business

Coming from humble beginnings, J. Fletcher Creamer and Son now employs more than 1,000 people and has six offi ces — three in New Jersey and one in California, Maryland and Atlanta — as it celebrates its 85th anniversary.

The family business is as American as the Fourth of July and home-made apple pie. Of course, as a family grow, so do its owned business, and J. Fletcher Creamer and Son, a top name in the construction business, recently celebrated 85 years of success.

Founded in 1923 by J. Fletcher Creamer, grandfather of current company CEO J. Fletcher Creamer Jr., the business began life as a mom and pop shop in a storefront on Lemoine Ave. in Fort Lee, N.J. At that time, the company had only one Ford rack truck, which it used to deliver oil and coal. Creamer and Son began to make a name for itself three years later when J. Fletcher Creamer Sr., chairman, took charge, purchasing two dump trucks to enable the company to haul rocks from the site where the George Washington Bridge was under construction.

“The completion of all Creamer’s projects and selection of its employees are measured against strong, ethical work standards,” said J. Fletcher Creamer, Jr. “We are especially proud of the fact that we are a family business. Our strength comes from the fact that we have worked together throughout all these years.”

The company has six offices: three in New Jersey and one in Sylmar, Calif.; Beltsville, Md.; and Atlanta. Creamer, whose specialty is pipeline construction and rehabilitation, is equally successful in utility and heavy highway work such as the Route 4 and Route 17 flyover in Paramus, N.J., (a joint venture with Joseph M. Sanzari Inc.) and excavation work as is evident by the Meadowlands Xanadu Project. It has built fountains and baseball fields and laid fiber-optic cable for Verizon as its exclusive New Jersey contractor.

The family business, which now employs more than 1,000 people, has expanded in size and diversity of projects since that little storefront. Eight-five years strong, Creamer plans to continue its tradition of being family owned and operated.

Claims Avoidance Program Hit Big in 2007

Accidents will happen, but the Claims Avoidance Program (CAP) has your back. Last year CAP had a 94 percent success rate in claim reversals or reductions.

While the final numbers are yet to be determined, it’s still exciting enough to break out the party hats and noise makers, as the National Utility Contractors Association’s (NUCA) Damage Prevention Claims Avoidance Program (CAP) had a banner year in 2007. Out of 80 claims handled last year, 65 were either reversed or reduced and 10 are still in the works.

Only five claims could not be mitigated. This reflects a 94 percent success rate, which could significantly increase as the last claims are finally resolved.

Last year the CAP was responsible for at least $287,000 in terms of dollars saved for the underground contracting industry in claims avoidance and litigation.

The CAP program is a three-tiered benefit that offers NUCA members: 1) unlimited free consulting on damage prevention best practices; 2) unlimited free consulting on effective damage investigation in cases where hits to underground facilities occur through no fault of the excavator; and 3) hours of free access to a facility damage expert to help contractors evaluate claims. If you need the CAP’s services or simply would like more information, call CAP Service Provider Ron Peterson at (816) 985-4436.

Compact Machinery for Contracting Collectors

Small toys for big boys -- JLG offers fi ve new die-cast models, including the two military telehandlers. The only way you can get your hands on these machines is by picking up these small fries.

Contractors love their toys — from skid steers and wheel loaders to excavators and telehandlers. Collecting machines can be pricey, so many manufacturers offer mini incarnations of their larger brethren. JLG has released five new die-cast models, including two military telehandlers that contractors can’t get a hold of any other way. The E33MJ mast boom lift, JLG Toucan model 1210 (the European version of model E33MJ) and JLG electric scissor lift model make up the rest of the model lineup.

Each has fully-operable components, which include movable booms, adjustable steering and highly detailed controls. A unique variable height-locking feature on all models allows the booms and scissors to be raised to any height without loss of elevation over time. This makes them ideal for display in any home or office.

Exceeding 16 in. in length, the two model replicas of the ATLAS II military telehandlers have the ability to extend their three-section boom more than 10 in. into the air at angles up to 45 degrees. The replicas of the ATLAS II feature accurate paint and decals, a highly detailed operator’s cab and engine compartment and 20 fully-functioning parts that allow them to roll forward and backward, lift and extend the boom arm and rotate the wheels into crab-steer, four-wheel steer and two-wheel steer modes. Two color schemes are available: olive drab and desert sand.

The mast boom lift models also feature more than 20 fully-functioning parts that allow them to roll forward and backward, lift and extend the boom arm and rotate the gray, non-marking rubber wheels into various steering modes. They are finished in baked enamel paint with authentic product decals.

The replica of the JLG 2646ES features an operator’s control module with one-handed controls along with highly detailed transmission parts and undercarriage components. Incorporating nearly 20 fully-functioning die-cast metal parts, the JLG 2646ES model also features gray, non-marking rubber wheels that steer and roll to help facilitate the die-cast model’s increased realism.

Provider Pals Spark Interest in Waning Construction Workforce

Constructing a new generation of contractors, Provider Pals points out the environmental progress construction trades have made in the last 30 years.

With the shortage of workers within the construction industry gnawing on the consciences of construction business owners nationwide, Provider Pals, a national youth cultural exchange program that got its start in Montana, is sparking interest in construction with the younger generation.

Provider Pals mission is to build a bridge of cultural understanding and respect between urban youth and their natural resource providers. Students are introduced to career options that they may have never considered. Provider Pals points out the environmental progress construction trades have made in the last 30 years, and the response has been positive

“The students see our occupations as viable career choices that they might want to pursue with pride,” said Bruce Vincent, Provider Pals Executive Director.

In the Provider Pals program, rural farmers, ranchers, miners, loggers and fisherman are adopted by the students in urban classrooms in areas such as Washington, D.C., New York, Detroit, San Diego and Los Angeles. The Providers communicate with the students on a regular basis via videotape and use of the Internet, culminating with a personal visit to the urban classroom to meet the students he or she has gotten to know.

“As the vast majority of Americans have moved farther and farther away from [rural] land, many have forgotten or maybe have never known where their things come from,” Vincent continued. “Milk and bread simply show up on the grocery store shelves and lots of boards show up at the lumber store on sale day. And most of our urban youth have never known a person who provides the necessities of their everyday life.”

This reality is particularly troubling for those who work in the environment in order to provide the public with food, clothing and shelter. To add more fuel to the fire, some environmentalists seek to stop production of services rather than cohesively working toward a solution that benefits everyone.

“The current three-word vision of ‘stop doing that’ is not going to work,” Vincent said. “To protect our environment, American needs a new vision of environmentalism.”

This new vision Vincent speaks of will be built upon hope instead of fear, science instead of emotion, education instead of litigation and employing rather than destroying human resources. And that new environmental leadership is going to have to come from those who live close to the ground.

Provider Pals is headquartered in Libby, Mont., and with a large donation from Ford Motor Co. now reaches over 10,000

students per year in over 30 cities around the nation. Last year, a donation from Caterpillar allowed them to build a unique virtual village online interactive educational gaming site. You can visit them at www.providerpals.com.

LETTERS TO THE EDITOR