Legislature Adjourns Without
Taking Action on Two Key ESSA Bills
(Go
Top)
The
NYS Legislature ended its 2005 session on June 24th without
approving two key bills pursued by the Empire State Subcontractors Association
(ESSA), despite the fact that both bills showed significant promise earlier in
the session. While each of these bills
passed in one house, the session unfortunately concluded without final action
being taken in the other.
Legislation
that would provide for delay damages to contractors on public projects where
such delay is for an unreasonable period of time and is the fault or
responsibility of the public owner passed in the Senate on June 15th. In the Assembly, this bill had been referred
to the Government Operations Committee, but despite vigorous lobbying by ESSA
and others, did not get reported to the Assembly floor before the session
ended. While supported by contractors
and subcontractors statewide, the delay damages bill was opposed by the
American Institute of Architects, the NYS Conference of Mayors, and other
organizations representing public bodies.
ESSA’s
other key bill would require retainage held on private construction projects
valued at more than $250,000 to be placed into an interest-bearing escrow
account for the benefit of the parties from whom such retainage has been
held. It is ESSA’s position that since
retainage represents funds that have been earned for work properly performed,
these funds should be protected by requiring owners to place them into an
escrow account, with the earnings on such retainage accruing to the benefit of
the contractors and subcontractors.
This bill passed in the Assembly on June 16th. In the Senate, the bill was reported out of
the Judiciary Committee to the floor in March, but then languished on the
Senate Calendar for months. Despite the
fact that hundreds of support letters were sent by subcontractors to Senate
Majority Leader Joseph Bruno, ultimately the Senate adjourned in June without
taking a vote. This bill was strongly
supported by contractors and subcontractors throughout the state, but the
powerful New York City real estate community aggressively opposed its passage.
Bill to Eliminate Retainage
on DOT Work Sent to the Governor (Go
Top)
Legislation
that repeals the holding of retainage on DOT highway projects has passed both
houses of the Legislature and was sent to Governor Pataki on July 14th
for his consideration.
This
bill amends Section 38 of the Highway Law by repealing the provisions of the
law that require the Department of Transportation to retain funds from progress
payments. The bill also amends the law
to eliminate the discretion of the Commissioner of Transportation to dispense
with performance bond requirements.
This
bill was introduced following a federal rulemaking that requires states to
reform their payment procedures to improve cash flow and eliminate retainage
for Disadvantaged Business Enterprises (DBEs).
Since the federal rules regarding retainage conflict with State Highway
Law, to comply and preserve federal highway aid, an amendment to state law was
made necessary. Since DOT had to
eliminate retainage for DBEs, it chose to eliminate retainage across the
board. In order to ensure satisfactory
completion of contracts, the Highway Law was also amended to require 100
percent performance bonds from all prime contractors. If the Governor signs this bill, it will take effect immediately.
Insurance Department
Approves 5% Increase in Workers’ Compensation Rate (Go Top)
On
July 15, 2005 State Insurance Superintendent Howard Mills approved a 5 percent
increase in the average workers’ compensation rate for the 12-month period beginning
October 1, 2005. The New York
Compensation Insurance Rating Board (NYCIRB) had requested in increase of 16.1
percent, which was the subject of a June 27, 2005 public hearing. Assessments, to support special-purpose
funds and the staffing of the Workers’ Compensation Board will also increase,
from the current rate of 15.1 percent to the new rate of 17.5 percent.
PRESIDENT’S MESSAGE (Go Top)
I’d
like to begin this message by thanking all members who have already renewed
your membership in NESCA for 2005-06.
It is very encouraging that by the end of the first month of our new
fiscal year, more than 60% of our members have remitted their 2005-06 dues
payment. A special thank you is
extended to those members who have made additional voluntary contributions to
our sustaining dues and PAC funds. To
those members who have not yet renewed, I encourage you to do so as soon as
possible. While the actual dollar value
of membership in any organization is difficult to calculate, several years ago
NESCA’s Board of Directors attempted to place a value on specific NESCA
benefits and services, and determined the total value to be more than
$8,000. Not a bad return on a $650
investment. The point is, we all benefit
from the information, education and advocacy NESCA provides. Prompt payment of your membership dues will
enable NESCA to continue to represent the best interests of NYS subcontractors
and suppliers in the year ahead.
As
you know, the summer months present NESCA with an opportunity to plan and
prepare the coming year’s membership meetings, educational courses and
seminars, legislative agenda and other association events. Many of our committees have met or will soon
be meeting, and by September, the association will begin another year of
important programs and activities. On a
personal basis, I’ve spent time this summer meeting with committee chairman,
past presidents and other association leaders to help me prepare for the coming
year.
September is already shaping up to be a rather busy month for NESCA,
with our first membership meeting of the year scheduled for September 8th,
our annual golf outing for September 12th, and various seminars and
courses also scheduled during the month.
Speaking
of our golf outing, members should have recently received information about
this event from the NESCA office. The
golf outing will be held on Monday, September 12, 2005 at Shaker Ridge Country
Club. If you plan on participating, I
encourage you to register for this event as soon as possible because the golf
outing normally sells out very early.
Two hole-in-one events, trophies for the winners of both team and
individual play, lots of special events, plenty of door prizes and great food
at a first class club combine to make our golf outing very popular.
I
also encourage you to set aside the time this year (second Thursday of the
month) to attend NESCA’s monthly membership meetings at the Century House. In addition to receiving the benefit of
timely and informative programs and regular updates on industry issues, where
else can you go each month to network with a room full of other subcontractors
and suppliers? I can tell you in all
honesty, I attend the membership meetings every month, and there is not a
meeting I attend where I don’t learn something of value or pick up some useful
piece of information either through the meeting program itself or through
conversation with other members.
Finally,
as I stated in the July Newsletter, I am very interested in receiving your
input as to how we can optimize the value of NESCA for all members. If you have any comments or ideas, please
pick up the phone and give me a call.
Harold M. Hatfield, President
Oregon Supreme
Court Finds Anti -Hold Harmless Law Applies To Additional Insured
Provision (Go Top)
On January 25, 2005, the
Oregon Supreme Court decided the Walsh
Construction Co. v. Mutual of Enumclaw case. The question on review of this
case was whether the prohibition against broad form hold harmless clauses
contained in an Oregon statute extended to the additional insured endorsement
that the general contractor obtained from the subcontractor’s insurer. The
Court held that not only did the Oregon statute prohibit direct indemnity
arrangements between parties to construction agreements but also additional
insurance arrangements by which one party was obligated to procure insurance
for losses arising in whole or in part from the other’s fault. The Court continued
by stating “whether the shifting allocation of risk was accomplished directly,
by requiring the subcontractor itself to indemnify the general contractor for
damages, or indirectly, by requiring the subcontractor to purchase additional
insurance covering the general contractor, was statutorily forbidden and was
the same.”
New
York State has a similar statute prohibiting broad form hold harmless clauses
and the Empire State Subcontractor’s Association currently has a legislative
bill proposal which would amend the law to include a prohibition against
additional insurance contracts. Certainly, the intent of the New York Statute
was to prevent a contractor from requiring a subcontractor to indemnify him for
damages caused by his own negligence. Hopefully, New York will follow Oregon
and extend the preclusion applicable to indemnification agreements to cover
additional insured endorsements.
Terence J. Burke, NESCA Legal Counsel
Dues Are Now Due
By the end of the first month of our
new fiscal year, more than 270 (60%) of NESCA’s members have already paid their
2005-06 membership dues. We thank the
early payers for your prompt response to our invoice and ask all other members
to please pay your dues as soon as possible so that NESCA may continue its work
on your behalf in the coming year.
OGS Seeking More Contractors for Emergency Contract
Program
(Go Top)
The
NYS Office of General Services (OGS) has notified NESCA that it would like more
contractors to become interested in participating in its emergency contract
program. Areas of particular priority
include “A” – Asbestos/Lead Removal and Remediation, “I” - Refractory/Chimney
and “U” – Elevator Repair.
OGS
awards approximately 500 emergency contracts annually for as much as
$200,000. Bids for emergency contracts
may be taken over the phone, and require an immediate response and performance
of the work. Emergency contracts are of
short duration and are usually awarded on a cost plus basis.
The
Public Buildings Law requires OGS to establish a list of contractors who are
interested in bidding on emergency work by trade interest and geographical
area. Bids are solicited from this list
on a rotational basis. Placement on the
various trade lists are subject to meeting the requirements outlined in Emergency
Contract Bidders List Requirements and are subject to a review,
verification and approval of the company’s work experience.
NESCA
members who would like to be added to the OGS emergency contract list, must
complete and submit:
·
BDC
321 – Emergency Contractor Information Form
·
CCA-1
– NYS Uniform Contracting Questionnaire
·
Appropriate
Workers’ Comp and Disability Forms
To obtain the necessary
forms including the Emergency Contract Bidders List Requirements call
the Office of General Services at (518) 474-0203 or visit the OGS website at www.ogs.state.ny.us.
Enroll in Electronic Payment Program (Go Top)
Contractors
who do business with the State are encouraged to enroll in the Electronic
Payments Program being offered by the Office of the State Comptroller. The Electronic Payments Program replaces
payment by check with electronic transfer of funds directly to your company’s
bank account, saves time a paperwork, and provides the option of receiving
notification of payment via email upon request.
To
learn more about Electronic Payments, contact the NYS Office of the State
Comptroller at (518) 474-4032, via email at epunit@osc.state.ny.us or visit the
Comptroller’s website at www.osc.state.ny.us.
CALENDAR OF
EVENTS (Go Top)
August 4, 2005
Board of
Directors Meeting
Century House,
Latham, 6 pm
August 18,
2005
NESCA/GBC/ECA
Seminar
Incident Free
Safety Training
Safety Training
Center, 10 am
September 8,
2005
Board of
Directors Meeting
Century House,
Latham, 5 pm
September 8,
2005
NESCA
Membership Meeting
Century House,
Latham, 6 pm
September 12,
2005
21st
Annual NESCA Golf Outing
Shaker Ridge CC,
11 am
September 26,
2005
NESCA/GBC/ECA
12-Wk. Course
Basic
Blueprint Reading
Building Industry
Center, 6 pm
September 27,
2005
NESCA/OSHA
Alliance Seminar
Electrical
Hazards
Building Industry
Center, 6 pm
Member Anniversaries (Go Top)
In August, the following members have reached milestone anniversaries as
members of NESCA. Thank you very much
for your continued support!
Ten Years
Custom Sheet Metal Systems,
Inc.
Kneeland Construction Co.,
Inc.
NESCA Thanks Members For
Sustaining Dues
and PAC Contributions
Thank you to all members who have paid their 2005-06
membership dues. A special thank you is
reserved for the following members who have made voluntary sustaining dues and
PAC contributions over and above their regular dues payment:
Sustaining Dues Contributions
President’s
Circle ($1,000)
Maximum Security
Products Corp. ê S & O Construction
Services
Leadership Team
($500)
Consolidated
Masonry Contractors ê Stone Bridge Iron &
Steel
Patron Group
($250)
Ashley
Mechanical ê
Cristo Demolition
Sustaining
Member ($100)
Admar Supply ê Advance Welding & Fabricating ê
Dorfman-Robbie CPAs
R.M. Lill ê Mid Orange Mechanical ê MVP Construction
Oneonta Block Co. ê Rizon Construction ê Rommel
Fence ê Southern Tier Insulations
Terminal Millwork
Friend
of NESCA ($50)
Adept
Surface Specialist
PAC Contributions
Adept Surface Specialist ê
Architectural Glass & Mirror ê Arold Paving Co.
Ashley Mechanical ê Burt Crane & Rigging ê Chip Kronau Construction
Crisafulli Bros. Plumbing
& Heating ê Cristo Demolition ê Flex Electrical
Constructors
Gould Erectors & Riggers
ê Interstate Reinforcing ê J&K Plumbing &
Heating Co. Mid Orange Mechanical ê Oneonta Block Co. ê Precision Glass &
Aluminum ê Precision Industrial
Maintenance ê Postler & Jaeckle Corp.
ê R.M. Lill
RAMSCO ê Rizon Construction ê S&O Construction
Services ê STS Steel
Star Roofing &
Restoration ê Stone Bridge Iron &
Steel ê Sunstream Corporation
Terminal Millwork ê VBI, LLC
There will be no NESCA
membership meetings during July or August.
The next regular membership meeting has been scheduled for September 8,
2005 at the Century House.
