southern california contractors association (scca) magazine: jan/feb 2012

SCCA MAGAZINE is published seven times a year by the SOUTHERN CALIFORNIA CONTRACTORS ASSOCIATION for union contractors

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Postmaster: Send address changes to SOUTHERN CALIFORNIA CONTRACTORS ASSOCIATION, 6055 East Washington Blvd., Suite 200,

Los Angeles, CA 90040. Copyright 2012, by Southern California Contractors Association. All rights reserved.

SCCA MAgAzine JAnuAry/FebruAry 2012 | SCCAWeb.Org 3

I N T H I S I S S U EJANURAY/FEBRUARY 2012

Features12 BUSINESS BOTTOM-LINE

Why Prequalifying and Bonding Subcontrac-tors is Essential in Today’s Market

14 ARTBA: ECONOMIC FOCUS2012: Transportation Construction Market Outlook Mixed

16 CONTRATORS EDGE“Best” Practices In Claims Management

18 SCCA EVENT: 2012 PAC AUCTIONCinco de Mayo & 2011 PAC “All-stars”

20 AFFILIATE MEMBER PROFILE Carno & Carlton, LLP: A "Brief" Look at a FirmAdvancing the Legal Rights of the Industry

22 SIGNATORY SPOTLIGHTRiverside Construction Company, Inc.: A “Site”of Industry Growth

24 SIGNATORY MEMBER PROFILE Sequoia Consultants, Inc.: A “Diverse” Approach to Business

26 REGULATORY ROUNDUP CARB’s Truck & Bus Regulation is Here – What Do We Do Now?

30 MEMBER NEWS SCCA New Members & Announcements

66 EDITOR’S NOTEEDITOR’S NOTENew Era, New Identity

88 PRESIDENT’S PERSPECTIVEPRESIDENT’S PERSPECTIVELeading SCCA is a Team Effort

99 EXECUTIVE REPORTEXECUTIVE REPORTIt’s Time the Construction Industry Goes onthe Offense

1010 CALIFORNIA LEGISLATIVECALIFORNIA LEGISLATIVELOWDOWNLOWDOWNSB 95 Becomes Law, Protecting HighwayContractors

1111 INDUSTRY INSIDERINDUSTRY INSIDERTransportation & Construction Industry Report

1818

Columns

2222

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6 SCCA MAgAzine JAnuAry/FebruAry 2012 | SCCAWeb.Org

New Era, New Identity

On the Issue

OFFICERSPete Rasic, President Mike Murphy, Vice President Donald "Matt" Pim, Secretary Scott Macintosh, TreasurerCurtis Farrow, Immediate Past President

PAST PRESIDENTS

STAFF

Larry Russell, Executive Vice PresidentAmanda Lean, Director of Communications

Mike Roddy, Director of Labor Relations

Evita Campos, Director of Administration

Tino J. Vasquez, Administrative Assistant

Todd & Michelle Bloomstine, Legislative Advocates

MAIN OFFICE

6055 East Washington Boulevard., Suite 200 Los Angeles, CA 90040

Office:(323) 726-3511 • fax: (323) 726-2366www.sccaweb.org

SAN DIEgO

(858) 527-1004

1974 Edwin M. Kalish

1975 Leonard Brutocao

1976 Lee Volmer

1977 Charles W. Poss

1978 Don Thompson*

1979 Jack Saiz Jr.

1980 John J. Clarke

1981 Donald Gladden

1982 Bill Maness*

1983 Tim MacDonald

1984 Arnold S. Nelson

1985 Dan Grandpre

1986 Donald L. McCoy

1987 James D. Sprinkel

1988 George B. Cooke

1989 LeRoy McAfee*

1990 Jon Salata

1991 James T. Gasparo

1992 Dean Rasmussen

1993 Les Farrow

1994 Stan Howard

1995 Doug Burhoe

1996 Jack Blakely

1997 Greg Erickson

1998 Jim O’Kane

1999 Brad Cooke

2000 George Bragg*

2001 Chuck Poss

2002 Greg Dineen

2003 Mike Crawford

2004 Paul Von Berg

2005 Dorna Seanez

2006 Doyle Powell

2007 David Elsberry

2008 Seth Hammond

2009 Larry Nodland

2010 Charles Rasmussen

2011 Curtis Farrow

* deceased

David AllenMike BarthTravis ClausenScott DamonMike DiDonnaRosie EvansNeil GoodaleRick GoveStanley HowardDale HussTom KovacichBrian LaLonde

Ed LyonDavid PatapoffDan PilonMike PowellDennis RichensGreg SalsburyLee SteinbergChris TorresEdward Twining Jr.Rita Vigil-FergusonMike Zanaboni

DIRECTORS

MARCH 14 6:00 PMMembership MeetingFullerton Crowne Plaza

APRIL 4 10:00 AMSpring Golf TournamentSierra Lakes Golf ClubFontana

MAY 5 6:00 PMLegislative Dinner and PAC AuctionSanta Ana Embassy Suites

MAY 9 6:00 PMValley Membership MeetingBurbank Castaway

JUNE 13 TBDMembership BBQ

AUGUST 8 6:00 PMScholarship AwardPresentationFullerton Crowne Plaza

SEPTEMBER 12 6:00 PMMembership MeetingFullerton Crowne Plaza

SEPTEMBER 26 10:00 AMJere Meacham Memorial Golf TournamentTBD

NOVEMBER TBD 5:30 PMPresident’s GalaTBD

2012 SCCA MEETINGS & EVENTS

The Southern California Contractors Association (SCCA)Magazine’s new look is a reminder of the Association’scontinuing evolution. The new cover, typefaces, sectionheadings and layout scheme aim to convey both SCCAtraditions and progress.

Since its inception in 1974, its commitment to evolving theindustry and “setting the bar,” has remained paramount.The Association continues to dedicate itself to upholdingcontractors and affiliated service providers to fair andequitable business practices while maintaining a politicalpresence and voice that serves as a check to an alreadyover-regulated industry.

I am committed to working with each of you to continueSCCA Magazine’s tradition of addressing industry-relatedissues by promoting member conversation that enhancesyour ability to overcome business challenges as SCCAtransitions into this exciting new era!

By Amanda LeanSCCA Director ofCommunications

“As the new Editor ofSCCA Magazine, my

aim is to convey bothSCCA traditions and

progress.”

Follow us on:

Advertising & MarketingAmanda Lean, Editor

Office:(323) 726-3511 | Fax: (323) 726-2366

Editorials & Content ContributionE-mail submissions to: [email protected]

Contact SCCA Magazine

“Building Southern California’s Future…”


Congratulations to Curtis Farrow and hisleadership team for a successful term andfor guiding SCCA to new heights. We ap-preciate Curtis’ service to the Association.Thank you to all of the Membership for en-trusting the Presidency with me for the nextseveral months. It is an honor to serve andI look forward to working with everyone inthe Association to take SCCA to the nextlevel.

General Douglas MacArthur is one of onlyfive men to be named General of the U.S.Army. He served as Chief of Staff of the U.S.Army during the 1930s and played a promi-nent role in the Pacific Theater during WorldWar II. He twice received the Medal of Honorand Distinguished Service Cross and wasalso awarded the Silver Star seven times.

What you may not know is that afterMacArthur was recalled to active duty in1941, as Commander of the U.S. ArmyForces Far East, a series of disasters fol-lowed, including the destruction of the U.S.Air Force base by the Japanese in the Philip-pines. MacArthur’s troops were forced towithdraw to Bataan. He eventually escapedon a PT boat to Australia in 1942. That’swhere he became Supreme Commander ofSouthwest Pacific Asia. His forces soon tookback the Philippines and MacArthur even-

tually accepted Japan’s surrender in 1945.

The reason I begin with this story is becauseGeneral MacArthur served during one ofthe most challenging times in American his-tory. He led through adversity and eventu-ally altered the course of history bydefeating the challenges facing him stating,“A General is just as good or just as bad asthe troops under his command make him.”

SCCA has a great leadership team in place.As MacArthur knew, his leadership wasonly as good as the troops in his command.The same holds true for SCCA. Your lead-ership team brings a lot of energy and un-matched commitment. However, ourAssociation’s success depends on everyonepulling together in the same direction toachieve our objectives.

Not unlike the challenges MacArthur facedduring WWII, America faces serious eco-nomic challenges today. As we all know,California’s construction employment isdown 40 percent from 2006, and the con-struction market is down nearly 60 percentin this same period. This situation has beenexacerbated by overzealous regulators andelected officials unwilling to invest in ourinfrastructure. We have all been throughthis prolonged market downturn togetherand eventually the market will turn around.

Over the course ofthe next year andforeseeable future,your leadership teamis committed tomaintaining SCCA’sleadership role inprotecting and grow-ing the constructionindustry in southernCalifornia. Ourmission is simple –to cont inue toprovide the bestservice to ourMembers, modern-ize the Association’sgovernance, growthe Membership,continue SCCA’sexcellent labor relations representation andregulatory advocacy, while building uponprograms aimed at member training,education, and local, State, and federalgovernment relations. With your help, weare committed to doing that.

SCCA is a solid organization with a remark-able history. Together, we are going to buildSCCA’s future and take our Association tothe next level.

Leading SCCA is a Team Effort

President ’s Perspect ive

by Pete RasicSCCA President

“It is an honor to serveand I look forward to

working with everyonein the Association to

take SCCA to the next level.”


Execut ive Report

Sun-tzu and Machi-avelli have writtenreams on politicaland military strategy.One theme echoesthroughout theirwork – the bestdefense is a goodoffense. Forcing youropponents to defendtheir work compelsthem to reassesstheir strategy andslows their efforts.This is what theanti-growth envi-ronmental movementhas been doingeffectively for decades.

What does this have to do with construc-tion? Any winning strategist knows the im-portance of having both a solid defense andan aggressive offense. This fact not only ap-plies in political and military theory, but alsois a universal adage in political, governmen-tal and regulatory advocacy.

For a number of years, SCCA and our in-dustry partners have relied on defense whenfacing the California Air Resources Board(ARB). We have had marginal success. Our

efforts to achieve reasonable air regulationsand a rational implementation plan continueto fall on deaf ears. I’ve heard countless sto-ries from our Members calling, writing let-ters, attending meetings, talking with theirelected officials, and spending six or sevenfigures to comply with the impending airquality rules.

SCCA reported that the Construction Indus-try Air Quality Coalition (CIAQC) wroteCalifornia Governor Jerry Brown in Decem-ber regarding ARB’s Truck & Bus Regulationand the Board’s failure to address the laun-dry list of unanswered grievances and safetyconcerns to date. After months ofstonewalling – miraculously, after writingthe Governor, ARB responded to all ofCIAQC’s concerns within a week!

This experience demonstrates ARB’s acutesensitivity to political pressure. CIAQC hasasked Governor Brown to address these is-sues and a moratorium be imposed on therule. While it is unlikely the Governor willgrant a moratorium, his Office is committedto working with ARB to address the indus-try’s concerns on the rule’s implementation.

We need to go a step further. It’s time theconstruction industry changes its strategy,goes on offense, and takes our case directlyto the Legislature!

SCCA is working with coalition partners todevelop legislation to stop implementationof the Truck & Bus Regulation until the ver-ified diesel emission systems (VDECS) canbe certified safe by the California Occupa-tional Safety and Health Standards Board(OSHSB). Currently, ARB does not certifythe safety of this technology. ARB only certi-fies VDECS achieve the emission reductionsthat they were designed to produce.

VDECS’ safety concerns are wel l -documented. There have been a number offires associated with these filters on con-struction equipment, trucks, and buses. Itis SCCA’s position that this technologyneeds to be certified safe BEFORE the staterequires its use by our Members.

SCCA is circulating draft-legislation toour industry partners for their supportand we will introduce legislation in thenext few weeks. We will keep you postedas this process moves forward. We needyour help to gain traction on this impor-tant measure.

To affect positive change in the constructionindustry, we need an effective offensivestrategy to execute our game plan. We lookforward to working with all of you to makethis happen.

It’s Time the Construction Industry Goes on the Offense

by Larry RussellSCCA Executive Vice President

“It’s time the construc-tion industry changesits strategy, goes on

offense, and takes ourcase directly to the

Legislature!”


Cal i fornia Legis lat ive Lowdown

Contractors will no longer face the possi-bility of work stoppages due to late Statebudgets thanks to emergency legislationrequested by State Controller John Chiangthat passed Feb. 3, 2012.

The bill, SB 95 provides the State with theauthority to loan funds to Caltrans andlocal transportation agencies in order toensure the financing of on-going trans-portation projects in the event of a pro-longed budget impasse.

This is identical to the goal of SCCA-spon-sored AB 1308 by Assemblyman Jeff Miller(R-Corona) in 2011. AB 1308 was drafted inresponse to the 2010 budget impasse thatforced Caltrans to inform and advise cur-rent contractors working on transportationprojects in the late summer/early fall of pos-sible work stoppages on those existing jobs.

Thankfully, Caltrans was able to creatively

manage their funding and preclude anywork stoppages.

There’s another aspect of the Bill that alsohelps the state deal with its cash flow man-agement problem. This was the portion of theBill sought by State Controller John Chiang.

Although State expenditures are consis-tent, the State receives its revenue at in-consistent times of the year. The influx offunding arrives in March and April duringtax filing time. But other sources of fund-ing, including sales tax, quarterly incometaxes, federal funds, consistently come intoState coffers on a regular basis.

When cash flow problems occur, revenuesdo not come in as expected based on thebudget. This Bill will fix that problem.

SB 95 grants the Controller the authority touse funding from the Highway User TaxAccount (HUTA) to back short-term State

borrowing for cashflow management.HUTA funds are notactually borrowed,only used as collat-eral. The Bill simplygives the Controllerthe authority to bor-row funds shortterm, being one dayto one week, for gen-eral State operations.

The funds are thenpaid back with otheranticipated State rev-enues. This is a com-mon financing toolused by the State with special funds usedas the backing for short term cash man-agement purposes.

For the record, it is unconstitutional for theState to borrow transportation funding.Proposition 22, which passed with 60.7percent of the vote in 2010, specificallyprohibit the State from raiding trans-portation funds.

As an added protection, SB 95 specificallyprecludes any cash management financingthat might interfere with “carrying out of theobject for which these funds were created.”

All in all, this is a great victory for the con-struction industry and SCCA. While SCCAplayed a key role in helping pass SB 95through the Legislature and sponsoringAB 1308 last year, Transportation Califor-nia, of which SCCA is a member, took theissue to the forefront of the cash manage-ment negotiations. Transportation Califor-nia Executive Director Mark Watts iswell-deserving of special recognition forassuring the intent of AB 1308 was in-cluded in SB 95.

While SB 95 was a sure-fire victory for theindustry, Republicans took exception to theoverall process of moving the Bill soquickly through the Legislature with themajority of Republicans voting against theBill. There were a few exceptions of whoalso deserve special recognition.

Assemblymembers Katcho Achadjian (R-Arroyo Grande), Nathan Fletcher (R-SanDiego), and Kevin Jeffries (R-Riverside),were three of four Republicans from bothhouses that supported SB 95. The fourthRepublican, former SCCA “Legislator ofthe Year” honoree, Assemblyman JeffMiller (R-Corona), not only supported theBill, but publicly spoke in favor of it, lob-bying his fellow Republicans to join him invoting to pass SB 95. Thank you Assem-blyman Miller!

SB 95 is another victory for long-term,stable transportation funding in California.

by Todd BloomstineRegistered Lobbyist

and Owner of Bloomstine & Bloomstine

“SB 95 is a victoryfor transportation

funding in California.”

SB 95 Becomes Law, Protecting Highway Contractors

SCCA membership returns real value to your business. Handling laborrelations, regulatory representation or government affairs is not a do-it-yourself job.

Here’s just a slice of SCCA’s membership value equation:

n Full-time labor relations—negotiations, representation in grievance

and arbitration

n Regulatory representation with CARB, Cal/OSHA, SWRCB and more

n Networking opportunities to help build your business

n Cut workers’ comp cost 5 percent to 45 percent with our ADR trusts

n Full-time legislative action in Sacramento and Washington D.C.

n Vital information resources for your business

Membership.Here’s what’s in it for you.

For more information, visit our website at

www.sccaweb.com/accomplishments.htm

or call our friendly, professional staff at (323) 726-3511

Southern California Contractors Association

6055 E. Washington Blvd. #200, Los Angeles, CA 90040

(323) 726-3511 | fax (323) 726-2366 | www.sccaweb.org


Industry Ins ider

Transportation & Construction Industry Report

Federal Motor

Carrier SaFety

adMiniStration’Snew rulingS

Effective Jan. 3, 2012,the Federal MotorCarrier Safety Ad-m i n i s t r a t i o n(FMCSA) has a newrule which dealswith commercialtruck and bus driv-ers using handheldcellular telephoneswhile operating avehicle. Now that itis illegal, drivers

who are caught will face up to $2,750 in civilpenalties per fine. Companies that permitthis type of behavior will also face a maxi-mum penalty of $11,000. The law doesn’tban the use of hands-free devices such asBluetooth headsets or those that allow thedriver to answer a call with the push of asingle button, but do not require the driverto hold the device.

CaltranS reviSitS detaChable towing

unit iSSue

At our last California Transportation Per-

mits Advisory Council meeting held on Oct.18, 2011, we discussed the significant issuesthat center on the State of California De-partment of Transportation’s (Caltrans’) def-inition of “single use” and what it considersminor revisions to the existing policy. Cal-trans is now allowing a Detachable TowingUnit (DTU) mounted on a tractor chassisand issued a carrier member its GreenWeight Annual Transportation Permit,which had been in question. This annualtransportation permit is only good for oper-ation within a 100-mile radius of the car-rier’s facility. Caltrans is allowing weightsfor the subject permit as per Special Condi-tions for Tow Trucks. For additional infor-mation, visit www.dot.ca.gov /hq/traffops/permits/pdf_documents/accomp/sctowt.pdf.

This additional axle weight is authorized fora disabled vehicle while under tow. The au-thorization is not intended to relieve theowner-operator of the disabled vehicle fromDivision 15, Chapter 5, of the California Ve-hicle Code which deals with “vehicleweight.” We want to thank Caltrans for theirreconsideration of this issue that will bene-fit our industry.

oCCupational SaFety & health

adMiniStration illneSS prevention prograM

Are you prepared for the OccupationalSafety & Health Administration (OSHA) ifyou have an accident on a jobsite? We re-cently had a Member who was involved in ajobsite accident. It appeared the Memberhad everything in order on the project.However, red flags were raised when OSHAstarted reviewing our Member’s compliancewith OSHA requirements, beginning withhaving a written and updated Illness & In-jury Prevention Program (IIPP), employeesafety training, and adequate compliancedocumentation. OSHA cited our Memberand found him to be in violation of OSHArules and regulations.

I have since talked to other small truckingcompanies and found that this is an issuewhere we need to raise awareness. If youneed help in writing or updating your IIPPor another element of your OSHA compli-ance, please give me a call. For more infor-mation, visit www.dir.ca.gov/occupational_safety.html.

Remember, one call to us can save you fromexorbitant fines, countless hours of dealingwith OSHA Investigators, and heartache.

by Greg DineenGreg Dineen & [email protected] www.GregDineen.org

“We need to raiseawareness to these

transportation & construction issues.”

Why Prequalifying & Bonding Subcontractors areEssential in Today’s Market: Part I

Business Bottom-Line


One of my contractor clients, commonly says when talking about his businessthat, “I’m not in the construction business; I’m in the risk-analysis business.”This has always stuck with me, because it highlights the simple fact of howmany variables there are in construction. These variables naturally create a lotof risk and as a result, one of the key areas to being successful in the construc-tion business is managing that risk. But risks constantly change.

Not long ago when construction was booming, one of the major risks many con-tractors faced was getting overextended, because there was so much work outthere. Today, that risk has shifted to a concern over getting enough profitablework to survive. Another major risk that has surfaced in the current economicenvironment is subcontractor failures and defaults. This is a growing risk notonly faced by general and prime contractors, it is something any contractor thatuses subs is exposed to, which includes many first and some, second-tiersubcontractors.

In the good years, most contractors didn’t worry all that much about their sub-contractors holding the numbers they gave at bid time or having the financialwherewithal to perform the work. There simply weren’t a lot of subcontractordefaults, and many of the large ENR 400 contractors relaxed or eliminated their

subcontractor bonding require-ments. But, as I’m sure you canattest to, that has all changed intoday’s tough market.

The subcontractor market hasbeen hammered in the currenteconomy. When it comes to pub-lic work, subs have generallyfaced even more competition andaggressive pricing from com-petitors than prime and generalcontractors have. This washighlighted in a benchmarkingreport prepared by Singer Lewakthat I received earlier this year. Thereport showed that the group ofgeneral contractors used to com-pile the data had an average netincome as a percentage of revenue of 2.4 percent in2010, versus an average of negative 2.9 percent for thesubcontractors.

We are receiving more frequent claim notices fromlower tier subcontractors and suppliers on our primecontractors’ bonds, because their subcontractors aren’tpaying their bills. Many subs are also failing to honortheir bids or they are going out of business by the timejobs are starting, leaving primes and generals lookingfor replacement subcontractors. In talking with thesureties and claims attorneys we work with, there hasbeen a significant increase in the number of subcon-tractor failures over the last 18 months. Ultimately, thisis trickling its way to first-tier subcontractors and gen-eral contractors and there have been several put out ofbusiness just this year as a consequence.

So what can you do to protect yourself from this new risk?

prequaliFy SubContraCtorS

One of the most important things you can do is prequal-ify your subcontractors. I find that very few contractorshave a formal prequalification process for subcontrac-tors, and they generally rely on their prior history ofusing those subcontractors as their only criteria. Whilethere is some merit to that approach, it doesn’t accountfor the reality that all subcontractors are at risk – whetheryou have used them a hundred times in the past or not.

Prequalification is not something only the “big guys,”and owners can do, and there are ways you can per-form a simple prequalification to help you identify po-tential risks or issues. I recommend creating a shortquestionnaire that you update annually to get basic in-formation on potential subcontractors including:

• How long they have been in business

• Type of work they do and what scope they typicallyself-perform versus sub out

• List of largest projects completed along with contactinformation for the prime contractor or owner so you cando reference checks

• Insurance information

• Names of the lawsuits they have been involved thepast two years

By Daniel HuckabayPresident

Commercial Surety Bond Agency

[email protected]

“Risks constantlychange with how

many variables existin construction.”


• Surety information including theiragent’s name, surety’s name, single and ag-gregate bonding limits and premium rate

This basic information will help you get toknow your subs better and give you a base-line to evaluate whether a job they are look-ing to bid to you fits within their capabilities.

uSing Surety bondability letterS aS a

prequaliFiCation tool

A great, but widely underused, prequalifi-cation tool that you can get in conjunctionwith a questionnaire is a bondability letterfrom your subcontractors’ surety at least an-nually, but preferably semi-annually in today’smarket. A bondability letter will state whoyour subcontractors’ surety is and the singlesize job and total aggregate bonding capac-ity that your subcontractor is prequalified for.

When you get one of these letters, you getthe benefit of a third party surety under-writer reviewing the subcontractor’s historyof work, determining their financial abilityto perform future projects and a gauge as towhat size projects the surety feels the sub isqualified to take on. This is critical informa-tion you may not be able to get on your owndirectly from the sub, and even if you did,you probably wouldn’t have the time or re-sources to analyze it on your own.

The letter should be written by the subcon-tractor’s surety agent as attorney-in-fact on

behalf of the bonding company. This meansthey will need to include a notary acknowl-edgement and power of attorney at the backof the letter which gives you the assurancethat the surety approved the informationthat was put in the letter.

Remember though, that bondability lettersare just an indication of the surety’s willing-ness to support certain size projects in gen-eral. They are not guarantees to provide acertain bond. Changes in the subcontractor’sfinancial condition, issues with specificscope of work, or difficult terms in the sub-contract could prevent the surety from pro-viding a particular bond.

One additional thing you may consider issharing your subs’ bondability letters withyour surety agent. I always recommend thisto my clients, because I can often give theminsight into their sub based on the surety.Who the surety is tells a story, especially ifyour subcontractor has recently changedsureties.

requiring SubContraCtorS to provide

payMent and perForManCe bondS

Of course, the best way for contractors toprotect themselves from the risks of sub-contractor defaults today is requiring sub-contractors to furnish performance andpayment bonds. In this way, if your sub failsto pay its subcontractors or suppliers, orruns out of money to complete its scope of

work, you can look to their surety.

If a subcontractor indicates that they cannotprovide bonds and they are unwilling to es-tablish a bonding line with a surety, it maybe a sign that they do not have the financialwherewithal to survive on your project, orhave been declined in the past for variousreasons, and you may want to steer clear ofthese subcontractors.

are you a good riSk analySt?We all know there is no margin for errortoday in the construction business and thosebusiness owners that are good risk analystswill be the ones who survive to tell aboutthis time years from now. Having a goodprequalification process can help you iden-tify some of those subcontractor risks andrequiring your subcontractors to requireperformance and payment bonds, in certainsituations, can help you mitigate some ofthose risks.

Next month, I’ll be writing a second part tothis article explaining how contractors usethe prequalification and bondability lettersdiscussed here, to identify more significantrisks facing subcontractors. I’ll also suggestspecific ways in which these risks can bemitigated.

If you are interested in a sample subcon-tractor prequalification form, please e-mailme at [email protected].

Business Bottom-Line

2012: Transportation Construction Market Outlook Mixed

ARTBA: Economic Focus

no Matter how you SliCe it, the aMeriCan

road & tranSportation builderS aSSoCia-tion’S (artba) outlook For the 2012 tranS-portation ConStruCtion Market iS Mixed.

First the bad news, the highway and bridgeconstruction market is expected to contractsix percent to $72.6 billion, from an esti-mated $77 billion in 2011. The subway andlight rail markets will be down even more.

The good news, the railroad market, drivenlargely by private sector investment, isexpected to increase by nearly four percentand the value of construction for ports andwaterways is expected to grow by six percent,driven by work on both coasts in preparationfor the 2014 Panama Canal expansion. Alsoin the good news category for the trans-portation-construction market sector, as hasbeen the case the last five years, it will remainthe most stable industry sector.

The main factors driving the decline are notsurprising in highway and bridge construc-tion including the winding down of infra-structure investment under the AmericanRecovery & Reinvestment Act (ARRA), con-tinued weak growth of the U.S. economy,persistent state and local budget challenges,and a static Federal Aid Highway Program.

Of course, the long-delayed highway andtransit reauthorization bill remains a “wildcard.” In early 2012, if Congress passes amulti-year bill that maintains current in-vestment levels, it could help interjectgreater certainty in the market. Both Senateand House proposals also contain languageto expand the Transportation InfrastructureFinance and Innovation Act (TIFIA) whichleveraged quickly, could offer another mar-ket boost.

the MoSt Stable ConStruCtion Market

The transportation-construction sectorremains stable compared to other construc-tion markets. Between 2007 and 2011, thereal value of highway and bridge construc-tion, adjusted with the ARTBA Price Indexfor material prices including wages andinflation, fell only 10 percent. Over the sameperiod, the real value of total constructionwork in the U.S. fell by one-third, from $1.1trillion to an estimated $769 billion. The realvalue of residential construction tankedmore than 50 percent, from $500.5 billion in2007, to $236.5 billion in 2011.

The historical stability of the transportationmarket is due in large part to the role ofpublic sector financing. Over the last fewyears, federal investment through the High-way Program and ARRA has increased sig-nificantly and accounts for nearly 45 percentof all highway and bridge constructionspending. Although state and local govern-ments continue to have budget challenges

that impact their discretionary highway andbridge spending, most state highway user-fee revenues are constitutionally protectedand must be used for transportation pur-poses. While the transportation-constructionmarket is not immune to the overall U.S.economy, it is significantly less volatile thanother construction sectors that are more de-pendent on general economic conditions.

Slight deCline in paveMent work For 2012In 2011, pavement work experienced asharp decline of 14 percent to an estimated$45 billion. In 2012 it’s expected to decreaseby two percent to $44.1 billion and againattributable to less ARRA money in themarketplace.

bridge Market draMatiC Slow-down

In 2012, the value of bridge work is expectedto drop by 10 percent, from $26.3 billion to$23.6 billion. However, over the last threeyears the bridge market has continued togrow despite the recession for two reasons.First, projects are often larger and work hascontinued on projects that were awardedand underway before the economic down-turn. Secondly, state DOTs and local gov-ernments have put $3.2 billion in ARRAfunds towards bridge work.

Part of the forecasted decline in bridge workis because nearly all the projects that includeARRA investments are finished or underway.State DOTs and local governments are nowpulling back on new projects. This is likelydue to a combination of the delayed federalreauthorization legislation and continuedstate and local budget challenges.

uneven growth aMong StateS

Despite the national downturn in market ac-tivity, some states are poised for growth.There are 18 states where the value of stateand local government highway and bridgecontract awards for the 2011 fiscal year ishigher compared to 2010. This is an indica-

tor that the value ofwork in those stateswill likely increasein the coming year asthose projects are un-derway. The valueof contract awards isdown in 19 statesand Washington D.C.Contract awards inthe remaining eightstates were relativelystable, either up ordown within fivepercent.

In California, the real value of total State andlocal government contract awards has beenfalling slightly since the recession started in2008, but has remained in the $5.3 to $5.5billion range. This means that the value ofthe State market should remain stable aswork gets underway or continues on theseprojects. California government awards forhighway and bridge construction droppedfrom just under $5.5 billion in the 2009 fiscalyear to $5.3 billion in 2010. The market hasshown some recovery with $5.4 billion inawards for the 2011 fiscal year.

airport runway work Slated to dip

The value of work done on airport runwaysis expected to fall four percent, from $4.9 billionin 2011, to $4.7 billion in 2012, primarilybecause of flat funding for the AirportImprovement Program and continued fail-ure by Congress to pass a new aviationreauthorization program.

no FaSt traCk For Subway & light rail

After a decade of rapid growth, the real valueof subway and light rail construction isexpected to decline nearly 16 percent, froman estimated $5.4 billion in 2011, to $4.6billion in 2012. This drop is due in large partto the continued delay in the reauthoriza-tion of the federal surface transportation

By Alison BlackVice President & Senior

Policy EconomistAmerican Road &

Transportation BuildersAssociation



Economic Focus

1501 N. Susan St., Santa Ana, CA 92703Tel: (714) 554-5930 • Fax: (714) 554-5933

www.marcotrucking.com

MARCO TRANSPORT, INC.A Low Bed Service

• 5, 7, 9 Axle Trailers• Winch Trailers• Scraper – Jeep & Dolly• 9-Axle Goliath’s SteerableTrailers w/interchange beam

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Bob Reed – DispatcherRobert Allred – DispatcherTim McVay – President

CA#43205 USDOT #1340674

Market 2012 Value (Billions) 2011 Change %

Pavement $44.1 -2.0%

Bridge $23.6 -10.3%

Runways $4.7 -3.7%

Subway & Light Rail $4.6 -15.7%

Railroads $10.6 3.6%

Ports & Waterways $2.0 5.7%

YearHighway & Bridge Contractor

Total Employment (Thousands)Annual Change

%

2001 $345.8

2002 $345.9 0.0%

2003 $340.1 -1.7%

2004 $347.0 2.0%

2005 $350.8 1.1%

2006 $348.3 -0.7%

2007 $344.5 -1.1%

2008 $327.3 -5.0%

2009 $291.3 -11.0%

2010 $289.0 -0.8%

2011(e) $291.89 1.0%

bill. State and local government contractawards for subway and light rail are downsharply in 2011, indicating transit agenciesare pulling back on projects.

private inveStMent SpurS railroad Market

The railroad market driven largely by pri-vate investment, is expected to increase 3.6percent from an estimated $10.2 billion in2011, to $10.6 billion in 2012. In the longrun, the sector is expected to grow as theU.S. economic recovery gains strength.

portS & waterwayS Floating higher

The value of construction work for docks,piers, and wharves is expected to grownearly six percent, from $1.9 billion in2011, to $2 billion in 2012. ARTBA expectscontinued growth over the next five years.A number of East Coast ports are takingon projects in anticipation of the 2014Panama Canal expansion. West Coastports are also investing in infrastructureimprovements. Spending by the ArmyCorps of Engineers for inland waterwayprojects is expected to decline next yearcompared to 2011 levels.

Source: U.S. Bureau of Labor Statistics ARTBA estimate for 2011. Does not include employment by contractors classified in other con-struction sectors that may do transportation work.

Contractors Edge


Over the past three decades, our Firm hasobserved contractors in dispute with own-ers over failure to be compensated forchanged conditions, extra work, and ex-tended home-office overhead due to delays.In our experience, a sophisticated contrac-tor tries to avoid claims by managingchange-orders proactively, but even themost astute and sophisticated contractoroften finds themselves in a claim situation.

While “causation,” is the most important el-ement to successful claims management, wehave observed a positive trend as to resultsin the litigation of claims.

The following suggestions have proven tobe helpful to our clients:

1. Assuming the facts of the case favor thecontractor, we have found that successfulclaim management depends upon the qual-ity of the contractors’ documentation of thehistory of events surrounding the dispute.In other words, “the one with the best pa-perwork usually wins.” We advise ourclients that when a dispute arises theyshould immediately either assign new costcodes to the extra work or a new phase orjob number to collect and summarize theadditional costs related to the dispute.Those clients, who present to a judge a sum-

mary of job costs and attempt to identifyamounts relating to the extra work, gener-ally find themselves at a disadvantage.Judges are not contractors and should notbe expected to understand job cost reports.Making it simple for the judge goes a verylong way in supporting your claim. Hiring aclaims expert early in the process can payfor itself in increased awards. The claims ex-pert should be given sufficient time to assistyou in preparing your claim and avoidinglitigation.

2. Our contractors who are successful inclaims typically engage their attorney veryearly in the process. The attorney guidesthem to proper notice procedure and pro-tects their rights to the fullest. Once again,“the one with the best paperwork wins,” asyour attorney should be well versed in the“notice provisions,” and will file any and allnotices to the proper parties. They will mon-itor due dates of lien notices and filing ofany protective measures. They should alsohelp you avoid any pitfalls, which could re-duce the cost of litigation as well.

3. Our contractors who record job condi-tions either through digital recordings orvideotape generally benefit from the impacta photo has as compared to paperwork. We

have witnessed casessettle very quicklywhen videotapedrecordings are shownto demonstrateeither causation orto support the extrawork required.

4. Your attorneywill guide you as towhen, if ever, stop-ping work is theproper remedy orultimately cause youto lose claim rights.Knowing your rightsas you proceed inthe dispute can be very powerful in avoid-ing further damages.

5. You have a duty to mitigate your dam-ages in any dispute. You also look like a co-operative “solid citizen” when you preventongoing damage to the owners property.

There are obviously many factors that enterinto claims management. This brief article isonly a sampling of what we have observedto be the most important aspects of makingsuccessful contractor claims.

by Glenn GelmanCPA, MST, CFF

Managing DirectorGlenn M. Gelman & Associates

“The one with the best paperwork usually wins.”

“Best” Practices In Claims Management


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Service as near as Your Telephone

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SCCA Event

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YOUR SOUTHERN CALIFORNIA HEADQUARTERS FOR

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Your Southern California TEREX dealer forTrucks, Loaders, Excavators, Material Handlers,parts and service. Building and distribution ofKLEIN water tankers, truck, and portable towers.

SCCA PAC AUCTIONYou Do Make a DiFFerenCe!

We know you like to party and support SCCA – So on Saturday, May 5, 2012 do both!

Every dollar spent at this year’s PAC auction supports the candidates and issues that helpadvance the best interests of the California construction industry including:

• Protecting Caltrans funding.

• Expediting environmental processes.

• Fighting legislation that punishes contractors

Get involved by:

• Sponsoring our Legislative Dinner and PAC Auction.

• Donating items for our live and silent auctions

• Attending this fun event, complete with cocktails, hors d’oeuvres, dinner and dancing.

• Buying stuff—all proceeds go directly to fund SCCA’s PAC.

SCCA PAC AuctionSaturday, May 5th, 2012

Embassy Suites, Santa Ana


2011 PAC Auct ion “Al l-Stars”

Attended, Donated &SponsoredAtkinson, Andelson, Loya,Ruud & Romo

Brutoco Engineering &Construction, Inc.

C.A. Rasmussen, Inc.

Carno & Carlton, LLP

Crane Rental Service, Inc.

LaLonde Equipment Rental,Inc.

Pavement Recycling Systems

Riverside ConstructionCompany, Inc.

Savala Equipment Rentals

Specialty Crane & Rigging

W.A. Rasic Construction

AADT - American AllianceDrug Testing, a NationalSubsidiary of C-DATA

Bejac Corporation

Bob's Crane Service

California Crane & Rigging,LLC

Cattrac Construction, Inc.

Coast Crane Company

Commercial Surety BondAgency

Dielco Crane Service, Inc.

Fuhler, Baker & Co., CPA’s

G & F Concrete Cutting, Inc.

Harper Equipment Rental

Heffernan Insurance Brokers

Hydraulic Cranes, LLC

Jagur Tractor

Jezowksi & Markel Contractors Inc.

Johnson Machinery

Kamine Phelps, P.C.

Les Farrow Excavating &Grading, Inc.

Lovex General EngineeringCorp.

M.R. Tudor Companies

Mesa Contracting Corporation

Monteleone & McCrory, LLP

Northwest Excavating

OST Trucks & Cranes, Inc.

Pacific Boring, Inc.

Rock Structures Construction Co.

Sakaida & Sons Trucking, Inc.

Sharma General EngineeringContractors, Inc.

Southwest V-Ditch Inc.

Standard Concrete Products

T & T Truck & Crane Service

Vulcan Materials Company

Donated

Attended & SponsoredAllen Haight & Monaghan,LLP

Coastline Equipment

Nobest Incorporated

Ritchie Brothers Auctioneers

Salsbury Engineering, Inc.

Donated & SponsoredTrench Shoring Company

A Power Sweeping

Capital One EquipmentLeasing & Finance

DiDonna's Masonry Inc.

Hawthorne Machinery

KEC Engineering

Kirkland Lowbed

Sully-Miller Contracting Co.

Attended

Attended & DonatedAnglemyer Crane Rental

Blue Diamond Materials

Catalina Pacific

Concrete Coring Co.

Earth Construction & Mining

Garrett Moiser Griffith SistrunkInsurance Services, Inc.

Glenn M. Gelman & Associates

Hunt Ortmann Palffy Nieves,Lubka Darling & Mah, Inc.

Marco Transport Inc.

Marina Landscape, Inc.

Maxim Crane Works

Mobile Crane Operators Group

Mr. Crane, Inc.

Pinnacle Surety Services, Inc.

Powell Constructors Inc.

Quinn Company

Rialto Concrete Products

Sukut Construction, Inc.

Ugalde Trucking Co., Inc.

SponsoredChampion Crane Rental, Inc.

GILL and BALDWIN,P.C.

Attorneys serving the construction industry

in federal and state court litigation, claims,

bid protests, mechanics lien enforcement

and other receivable collection remedies

since 1962.

Kirk MacDonald

Gill and Baldwin, P.C.130 N. Brand Blvd., Suite 405 • Glendale, CA 91203

(818) 500-7755, (323) 245-3131

(310) 558-1115FAX: (818) 242-4305 • www.gillandbaldwin.com


Aff i l ia te Member Prof i le

Since 2005, Carno & Carlton, LLP, have val-ued SCCA membership due the quality ofthe Association’s Members, Member-to-Member loyalty, and the Association’s com-mitment to improving the constructionindustry. "That's a group we want to belongto," states Anna Carno. She has served onSCCA's Outreach Committee the past fouryears and in 2010, was Committee Cochair.

Carno & Carlton acknowledges SCCA’ssupport and assistance in its efforts to im-prove the law on behalf of contractors.Carno & Carlton is grateful for the Associa-tion‘s endorsement especially with respectto SCCA’s decision to file an amicus brief inthe Force Framing case.

In 2011, Carno & Carlton refused to allow aSuperior Court's misguided decision to re-main as the "last word," with respect towhat contractors are required to do to en-force their stop-notice rights. Instead, Carno& Carlton appealed the trial court's decisionand pursued all legal avenues to achieve acorrect and appropriate interpretation ofCalifornia law pertaining to stop-notice andlien rights. In Force Framing, Inc. v. China-trust Bank, Carno & Carlton convinced theAppellate Court to overturn a decisionmade by a Riverside Superior Court Judge

that held: “If a … [contractor] has reason-ably relied on an owner's and/or generalcontractor's statements identifying a lender,then the … [contractor] does not need tocheck county records to prove that he or shehad a good faith belief that the lender wasthe actual lender.” Force Framing, Inc. v. Chi-natrust Bank, 187 Cal. App. 4th 1368, 1376(2010).

This ruling serves to protect a contractor'spayment rights. Without it, owners couldgive erroneous information and not be heldliable because unpaid contractors wouldhave the sole burden of verifying the infor-mation the owner provided via a review ofcounty records.

The firm’s efforts have translated into in-creased protection for those in the con-struction industry. Said another way,whenever Carno & Carlton wins in thecourtroom, SCCA Members win too. Carno& Carlton's litigation experience includesrepresenting the legal interests of construc-tion companies, material suppliers, engi-neering firms, project managers, designprofessionals, defense contractors, andcommercial businesses.

Currently, the firm is in early discussion

stages with SCCAleadership about or-ganizing a newlegal committeewhere all SCCA Af-filiate Member lawfirms would havethe opportunity toserve as a legalresource for SCCAmembers, developlegal training forthe Association, andserve in an advisoryrole to the Legisla-tive Committee onlegal matters.

to potential SCCaMembers: "TheSCCA is one of the oldest construction-trade organizations committed to thegrowth of its members' businesses. Throughmultiple avenues, the SCCA keeps its Mem-bers apprised of industry changes by or-chestrating collaborative efforts amongst itsMembers, so that the growth of the affiliatesector serves to promote the growth of thecontractor sector, and vice-versa." Carno &Carlton, LLP.

Carno & Carlton, LLPMembers of SCCA Since 2005Anna Carno & Andrew Carlton24031 El Toro Road, Suite 220,

Laguna Hills, CA [email protected]

Carno & Carlton, LLP: A "Brief" Look at a Firm Advancingthe Legal Rights of the Industry

Riverside Construction Company, Inc.: A “Site” of Industry Growth

Signatory Spot l ight


GENERAL ENGINEERING CONTRACTORSspecializing in heavy/civil constructionWe have performed hundreds of projects with various agencies, numerous cities andmunicipalities throughout Southern California. Projects include roadways/freeways, streetimprovements, site work/development, bridges, retaining walls, dams, flood control channels,storm drains, and underground utilities.

BRIDGES | RETAINING WALLS | SITEWORK | FLOOD CONTROL | EARTHWORK | STREET IMPROVEMENTS | ROADWAYS | STORM DRAINS

www.rivconstruct.com Member since 1983

SERVING SOUTHERN CALIFORNIA FOR OVER 40 YEARS

4225 Garner Road • PO Box 1146 • Riverside, CA 92502(951) 682-8308 • Fax (951) 682-8350

Established in 1967, Riverside ConstructionCompany, Inc. (RCC) is a full-service generalengineering contractor specializing in heavy,civil construction. They have completed hun-dreds of projects working with numerousagencies, Cities, and municipalities through-out Southern California. Projects includeroadways and freeways, street improvements,site work and development, bridges, retain-ing walls, dams, flood-control channels,storm drains, and underground utilities.

RCC was named after the Citythat gave the business its start,Riverside, California and prima-rily completes projects located inthe Counties of Riverside andSan Bernardino. RCC being 100percent employee-owned lendsa unique approach within theconstruction business that theypride themselves on. By placingtrust in RCC Employees, meanseach is granted the freedom totake ownership of the Company’sfuture. With that being said, thisbusiness model substantiatesthe reason why project ownerscan rely on the high-caliber em-ployee work ethic and projectcompletion that is synonymous

with RCC. The Company continues to grow,despite the same economic challenges facingindustry business owners and serviceproviders by surpassing competitor’s qualityof work, giving the company a leg-up onfirst-class bids.

Growth was inevitable for RCC, uponchanging their construction sector focusfrom housing tract development street proj-ects to street construction for public agen-cies. Over the next few years, the Company

quickly evolved in size, capabilities, andstrength that resulted in RCC’s work onlarger public infrastructure. RCC adapted tothe processes required by public works proj-ects and began bidding competitively onventures including freeways, parks, flood-control facilities, and bridges.

On Jan. 18, 2012, RCC was requested bySenator Barbara Boxer (D-CA) to host a press

4224 Garner Rd. Riverside, CA 92501

[email protected]

Riverside ConstructionCompany, Inc.

SCCA Member since 1984President: Donald "Matt" Pim

Riverside Construction Company, Inc. Ranchero Road Job Site in theCity of Hesperia

Pictured from top left to bottom right: Paul Von Berg, BrutocoConstruction & Engineering Company, SCCA Executive VicePresident Larry Russell, U.S. Senator Barbara Boxer (D-CA),and SCCA Secretary & President of Riverside ConstructionCompany, Inc. Matt Pim.

Projects include roadways/freeways, street

i

Rivers ide Construct ion Company, Inc .

14050 Cherry Ave. #R 176Fontana, CA 92337Fax: 909-429-1662

[email protected]

Excavators • Loaders • DozersGeneral Engineering Contractor License A

C-21 Demolition

951-640-1835SCCA MAgAzine JAnuAry/FebruAry 2012 | SCCAWeb.Org 23

conference, at one of their job sites’ that was in the final stages ofcompleting a 2-year grade separation project aimed at alleviatinglocal traffic congestion. The Riverside project, located at MagnoliaAvenue and Merrill Avenue, will allow Union Pacific freight trafficto safely pass over these City streets, freeing up persistent trafficcongestion. Senator Boxer was drawing attention to the kinds of jobsthe Federal Transportation Reauthorization Bill should be funding,like this RCC project. “This bill [MAP-21] allows for projects likethis one, [the Magnolia Project] which is estimated to create or save170,000 jobs in California and over 1.8 million jobs,” stated SenatorBoxer.

In 1996, SCCA awarded RCC “Contractor of Year,” in recognition ofits successful business practices and for being a leader in theconstruction industry. In 2006, the Company was honored bySCCA with the Excellence in Accident Prevention Award, a distinc-tion bestowed only to 29 businesses in the area. As RCC grew, sodid its ability to give back philanthropically. RCC President MattPim, who sits on the Board of Directors of the Riverside CommunityFoundation, demonstrates the Company’s commitment to advancingadditional growth opportunities for others and annually awardsfour financial college scholarships to students who wish to pursueengineering.

Having been in business almost 45 years, RCC continues to be amajor industry leader, committed to providing the highest qualityconstruction business practices. Ultimately, the road of ahead ofRCC reiterates why they will remain a “Site” of industry growth –because they are the ones who built it!

to potential SCCa Members: “This Association has proven invalu-able by enabling you to meet new people, share in the camaraderieand the opportunities Membership brings. SCCA’s greatest benefitupon joining is its labor relations services by always being the pre-mier representation in the industry,” states SCCA Secretary andRiverside Construction Company, Inc. President Donald “Matt” Pim.


Sequoia Consultants, Inc.: A “Diverse” Approach to Business

Signatory Member Prof i le

Since opening its doors six years ago, Sequoia Consultants, Inc.(Sequoia) has a significant amount of experience in providing QualityAssurance and Quality Control (QA/QC) services to design-buildprojects in the transportation sector. They offer professional serv-ices in construction and engineer management with comprehensivematerials testing and inspection services for bridge, roadway, andlight rail transit projects.

Sequoia Consultants joined SCCA in 2006, and continues to benefitfrom their membership through networking with union contrac-tors, labor relations, legislative advocacy, and policy development.As a Member of SCCA’s Outreach Committee, Sequoia is involved

with educational and training efforts, aimingto assist SCCA members with subcontract-ing processes and encouraging other smallbusinesses to obtain certification.

“Outreach programs further American busi-ness because they are similarly founded onthe principles that buttress our Constitution,a desire by a group of smaller entities tohave the opportunity to prove their value bycontributing to the overall growth of theeconomy,” states SCCA Outreach CommitteeChair Rita Vigil-Ferguson.

Sequoia possesses several Minority Disad-vantage Business Certifications including:

• Disadvantaged Business Enterprise(DBE) - CUCP/Caltrans

• Small Business - California Departmentof General Services

• Small Business - “The Network” (Port of Long Beach, Port of LosAngeles,

MWD, SDCWA, LAUSD, LACCD, City of San Diego and MBDA)

• Community Business Enterprise (CBE) - County of Los Angeles

To date, Sequoia has worked on several major projects in SouthernCalifornia including the design and construction of Los AngelesCounty’s Mid-City/Exposition Corridor Light Rail Transit (LRT),HOT Express Lanes on the Interstate10 and 110 Freeways, Iconic Inter-state 210 Freeway structure, andState Route 125 Toll Road in SanDiego County. Typical project own-ers include Caltrans and variouslocal governments. The Firm isalso pursuing several other majordesign-build as well as conventionaldelivery-method projects in thetransportation sector.

Vigil-Ferguson also attributes,“Keeping all the work amongst afew does nothing to promote eco-nomic growth, while proving poten-tially detrimental toCalifornia’s hope for a diversi-fied and emerging economicbase. Simply put, if small com-panies grow, big companiesdo [grow] as well. Diversity iffully supported and embracedwill spawn ingenuity, compe-tition, strength, and growth.”

to potential Members: SCCAprovides invaluable network-ing opportunities for smallbusinesses, offers exceptionallabor relations assistance andservices, provides ADRs lowerWorkers ’ Compensat ionInsurance rate options, and advocates aggressively the best inter-ests of the industry on legislative and regulatory matters,” SequoiaConsultants, Inc. President Pri DeSilva.

Sequoia ConsultantsSCCA Member since 2006President: Pri DeSilva, PE361 W. Grove Avenue, Orange, CA 92865

[email protected]

www.sequoiaconsultants.com


APPLICATION FOR MEMBERSHIPSOUTHERN CALIFORNIA CONTRACTORS ASSOCIATION INC.

6055 E. Washington Blvd. #200, Los Angeles, CA 90040(323) 726-3511 • FAX: (323) 726-2366

__________________________________________________________________________________________________________________Please direct mail to (Company Representative Name(s) as you wish to appear on the roster).

_____________________________________________________________________________________________________________________________

Business Name

_____________________________________________________________________________________________________________________________

Mailing Address City State ZIP

_____________________________________________________________________________________________________________________________

Street Address (for UPS and overnight mailings) City State ZIP

___________________________________________________________________ _______________________________________________________

Business Phone FAX #

___________________________________________________________________

E-Mail Address

http:// _____________________________________________________________

Website

___________________________________________________________________

Membership Category (see box)

___________________________________________________________________

Contractor’s License No. /Classifications

___________________________________________________________________

Sponsored by

___________________________________________________________________

Sponsor’s Firm

I agree to give my time and ability to assist the association within limits of reasonableness.

–––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––––– –––––––––––––––––––––––––––––––––––––––––––––––––––––––

Signature of Applicant Date Signature of SCCA President

DUES SCHEDULEGROSS ANNUAL VOLUME ANNUAL DUES

SIGNATORY0................. $500,000 $525

$500,001.............. $2,000,000 $1,575

$2,000,001.............. $6,000,000 $2,625

$6,000,001............ $15,000,000 $3,675

$15,000,001 .................. and over $4,725

AFFILIATE MEMBERS

0.............. $5,000,000 $630

$5,000,001 .................. and over $1,050

ADR MEMBERS(Alternate Dispute Resolution)

All .........................$315

Print this application. Please print legibly or type information and fax to 323-726-2366.


CARB’s Truck & Bus Regulation is Here – What Do We Do Now?

Regulatory Roundup

Credit Note InstallationDeadline

Downsizing FleetMust have completedbetween Oct. 1, 2006 andJan. 1, 2012

Jan. 1, 2012

Early Addition of NewerVehicles

Fleet addition of substantiallynewer vehicles on Jan. 1,2012, than on Oct. 1, 2006

Jan. 1, 2012

Early Credit PM Retrofit Credit for installation of a PMfilter on a fleet truck Oct. 1, 2011

Excess Off-Road PMFilter Credit

Credit for installation of a PMfilter on off-road equipment Jan. 1, 2012

The California Air Resources Board’s (ARB) Truck and Bus regu-lation requires companies that own a commercial diesel truck witha Gross Vehicle Weight Rating (GVWR) of more than 14,000pounds or 26, 000 pounds with a Model Year Engine (MYE) of 1996to 1999, to meet certain compliance and reporting requirements be-ginning Jan. 1, 2012.

If you do not own any trucks that fall within the specificationslisted above, you are in compliance with emission control require-ments of California Vehicle Code, and thus the deadline and reg-ulation have no impact, yet. Therefore, you should assessing alloptions and CARB’s compliance requirements for subsequentdeadlines beginning Jan. 1, 2013. This should be done sooner ratherthan later to keep your compliance costs to a minimum. You maybe required to report your fleet data now in order to use certaincompliance options in the future.

What are those requirements and what are your options at thispoint?

CoMplianCe requireMentS oF Jan. 1, 2012 • Trucks that fit within the parameters above are to be retrofittedwith a Particulate Matter (PM) filter or vehicle diesel emission con-trol system (VDEC) by this deadline.

iF Failure to CoMply Jan. 1, 2012• Option 1: Alternative PM Best Available Control Technology(BACT) Schedule is available for fleets with no trucks above 26,000pounds with an MYE of 2003 to 2004, in addition to those with an MYEof 1996 to 1999, providing a later compliance deadline of Jan. 1, 2013.

• Option 2: PM BACT Phase-In which is available to those withthree trucks or more and only one over 26,000 pounds with a MYEof 1996 to 1999.

The chart below illustrates different credits available to reduce oreliminate your compliance obligations held by the Jan. 1, 2012,retrofit deadline under the PM BACT Phase-In option.

n Must have 33 percent of their fleet com-prised of these vehicles in compliance byJan. 1, 2014, with 66 percent retrofitted byJan. 1, 2015, and must have entire fleet incomplete compliance by Jan. 1, 2016.

low-use trucks

• Trucks that travel less than 1,000 milesper year

n Vehicles are exempt from all emission control requirements

“nox area-exempt” trucks

• Trucks limited to counties that attain the Federal Ambient AirQuality Standard

n Vehicles are exempt from all emission control requirement

• The California Counties that meet the Federal Ambient AirQuality Standard include: Alpine, Colusa, Del Norte, Glenn,Humbolt, Lake, Lassen, Mendocino, Modoc, Monterey, NorthernSonoma, Plumas, San Benito, San Luis Obispo, Santa Barbara,Santa Cruz, Shasta, Sierra, Siskiyou, Trinity, Tehama, and Yuba.

if your fleet is not comprised of any of the vehicles listed aboveyou are to retrofit your fleet according to currently mandateschedule.

reporting requireMentS oF MarCh 30, 2012 (previ-ouSly Jan. 31, 2012)The Truck and Bus regulation reporting deadline requires all in-formation regarding your fleet be provided and reflect its com-position as it existed Jan. 1, 2012. The general compliancerequirements state that you retrofit your fleet with PM filters orupgrade your trucks with an engine that meets with CaliforniaEngine Emission Standards from 2007 to 2012. Specifically, the re-porting requirements requested by March 30, 2012, are driven bythe two primary compliance paths CARB has outlined for truckswith a GVWR larger than 26,000 pounds. The complexities tothese paths are outlined in the chart below.

By Larry RennackerPrincipalArrowtek

qualiFing vehiCleS oF deFerred retroFit

SChedule or exeMpt:

limited Mile Construction trucks

• Dump trucks that travel less than 20,000 miles per year

• Concrete trucks consisting of a placing boom, water truck, orsingle engine crane that have a load rating of 35 tons or more

• Tractor that exclusively pulls a low-boy trailer

• Company-owned truck with a registered Contractor’s Licensethat travels less than 15,000 miles per year

CompliancePath Specifications Reporting

Requirements

BACT byModel YearEngine (MYE)

Regulation compliance deadlinesfor this path are determined basedon a truck’s MYE as to when yourfleet must be retrofitted with PMfilters or engines that comply with2010 engine standards*Truck’s with an MYE of 1996 to1999, are already required to bein compliance as established bythe Rule’s Jan. 1, 2012, deadline.Those trucks with later MYEshave later compliance deadlines.

Fleet reporting is not requiredby thiscompliancepath

PM BACTPhase-In

Fleets must bring a percentage oftheir fleet in compliance each yearthat requires:• Jan. 1, 2014: 30% fleet areretrofitted PM Filters• Jan. 1, 2015: 66% fleetretrofitted with PM filters• Jan. 1, 2016: 100% fleetretrofitted with PM filters

Fleet reporting is required bythis compliancepath


Compliance Path RequirementsTrucks with GVWR of 14,001 poundsto 26,000 pounds

Fleet reporting is not required by this compliance path.

Small Fleet- Three or less truckslarger than 14,000 pounds

Report any truck larger than 26,000 pounds with a1996-99 MYE

BACT by Model Year Compliance Path No reporting required for current compliance deadline

PM BACT Phase-In Fleeting reporting required by the deadline for theAlternative PM BACT schedule under the BACT by MYEcompliance path

If you use the PM BACT Phase-In compliance path now or use it in the future ARB saysyou need to report your entire fleet by the reporting deadline. I disagree with this report-ing requirement. If you are using the BACT by Model Year compliance path for the Jan.1, 2012 compliance deadline, but may want to switch to PM BACT Phase In for futurecompliance dates, there is no reason to report your complete fleet data now.

PM BACT Phase-In Credits Additional Reporting Requirements

Downsizing Fleet and/orEarly Addition of NewVehicle Credits

Report trucks owned, currently or in the future on Oct. 1, 2006,that were sold before Jan. 1, 2012. *I disagree with this requirement and should only be requiredto submit your 10/1/2006 fleet data only when and if you usethat credit and not before.

Excess Off-Road RetrofitCredits

Not entirely clear reporting requirements. Currently, you onlyhave to report if you are using any excess off-road credits. Atsome point you will need to provide the EIN for the off-roadequipment retrofit.

The Limited Mileage Construction truckextension requires you to report yourentire fleet by the reporting deadline out-lined within the specific compliance paththat applies. Trucks must also be labeledby the reporting date. This is one require-ment where I really disagree with ARB.You should only be required to reportyour trucks that are not non-limitedmileage construction trucks if the compli-ance path selected for those trucksrequires reporting.

If the “NOx Area-Exempt,” provision ap-plies to your fleet, ARB requires you to re-port all the trucks within it by thereporting deadline regardless of the com-pliance path you use. I disagree with thisrequirement as well. If you should onlyhave to report your trucks that are notNOx area exempt if the compliance pathyou select for those trucks requires reporting.

If your fleet contains trucks that areconsidered low-use trucks, there are noreporting requirements regardless of thecompliance path.

For further information on CARB Truckand Bus Regulation compliance pleasevisit: www.arb.ca.gov/msprog/onrdiesel/onrdiesel.htm.

ARB is allowing you to switch compliance paths from year-to-year. The reporting require-ments established by the different compliance paths are explained in the chart below.


Southwest Drilling, Inc.Contr. Lic 650989 Since 1992 dba

Jeff BrustExplosives Sales

619 443-8178fax 619 443-8129

P.O. Box 1677Lakeside, CA 92040

• Specialty Explosives• Explosives Supplies• Non-explosive

Demolition Agent

Dexpan Distributorwhen high powered explosive

use is not desireable


Newman BackhoeService, Inc.

In Business Since 1954

• EXCAVATION • FINE GRADE• COMPACTION EQUIPMENT

OPERATED & MAINTAINEDEQUIPMENT RENTALS

CAT, CASE & JD 4 x 4 BACKHOES • CASE & JD 4 x 4 SKIPLOADERS •DUMP TRUCKS • OFFSET HOES •

SKID-STEER LOADERS/BACKHOES • BREAKERS • COMPACTORS •

AUGERS • VEE & SPECIALTY BUCKETS

Contr. Lic. 265404A

Cat 446 backhoe,

auger and breaker attachments.

CALL

Serving Los Angeles, Orange, Riversideand San Bernardino Counties since 1954

FAX (714) 739-0812

714 739-24247381 WALNUT AVE. • BUENA PARK, CA 90620


Member News

SIGNATORYCal Stripe inC.2040 East Steel RoadColton, CA 92324Steve FleenerPhone: (909) 884-7170 • Fax: (909) 884-7106 Email: [email protected]: Striping

diablo ContraCtorS, inC.7 Crow Canyon Court, Ste 100San Ramon, CA 94583

Arthur D. BrandtPhone: (925) 552-8250 • Fax: (925) 552-8250Website: www.diablocontractors.comBusiness: General contractor specializing inheavy engineering construction

harber CoMpanieS, inC.1880 E. Riverview DriveSan Bernardino, CA 92408Brian HarberPhone: (909) 478-1957 • Fax: (909) [email protected]: Demolition & grinding

hook ConStruCtion inC.1308 Stockton Hill Rd #A298Kingman, AZ 86401Wayne Smith

Phone: (928) 716-3990Email: [email protected]

Website: www.hookci.comBusiness: General engineering contractor,general building contractor, fire protectioncontractor, warm-air heating, ventilatingand air-conditioning, B general residentialcontractor

Mdr inC.PO Box 940Roseville, CA 95661Michael Robirds

Phone: (877) 636-0430 • Fax: (916) 865-2711Email: [email protected]: www.mdrinc.netBusiness: Engineering and directionaldrilling services, turnkey design-build utility,and infrastructure services

MMC, inC. dba MMCSouthweSt, inC.412 East Gowan Road

North Las Vegas, NV 89032Brandon StottPhone: (702) 642-3332 • Fax: (702) 642-9936Email: [email protected]: www.nclasvegas.comBusiness: Water/Wastewater Contractor

tab ContraCtorS, inC.412 East Gowan RoadNorth Las Vegas, NV 89032Derek Stott

(702) 642-3033 • (702) 642-9936

[email protected]: Earthwork, asphalt paving, con-crete paving, wet utilities, demolition, andjet fuel line installation

AFFILIATEStheodore a. anderSon

law Corp.690 S. Brea Blvd.

Brea, CA 92821Theodore A. AndersonPhone: (714) 255-8525 • Fax: (714) 255-8530Email: [email protected]: www.theandersonlawoffice.comBusiness: Law firm

k.S.r. lowbed

30260 Clear Water Dr.Canyon Lake, CA 92587-7456Brandi RycraftPhone: (951) 217-9531Fax: (909) 658-8863Email: [email protected]: Lowbed transportation

Murtaugh Meyer nelSon &treglia llp

2603 Main Street, 9th FloorIrvine, CA 92614Houman Esmailpour

NATIONAL Quality & DependabilitySince 1946

CONTRACTORS & HOMEOWNERS• Colored Concrete• Concrete Pumping Available

NATIONAL

NORWALK (562) 865-6211SOUTH GATE (323) 564-1866ARTESIA (562) 865-6211IRVINE (949) 552-5566IRWINDALE (626) 303-7755SUN VALLEY (818) 768-0050

CANOGA PARK (818) 884-0893SANTA CLARITA (661) 252-8181SOLEDAD (661) 252-8181GLENDALE (818) 243-4243MOORPARK (805) 529-1673VAN NUYS (818) 786-2210

Serving Los Angeles, Orange & Ventura Counties

Radio DispatchedOpen SaturdayREADY MIXED CONCRETE CO.

NO JOB TOO LARGE OR SMALL

SCCA’s New Members


Member News

Phone: (949) 794-4000 • Fax: (949) 794-4099Email: [email protected]: www.mmnt.comBusiness: Law firm

rigging 4 leSS

a diviSion oF wrMPO Box 217Bonsall, CA 92003-0217Andy AdlerPhone: (760) 451-8634 • Fax: (760) 451-8674 Email: [email protected]: www.rigging4less.comBusiness: Rigging equipment

weSt CoaSt Sand & gravel

PO Box 5067Buena Park, CA 90622

Jeff StruiksmaPhone: (714) 522-0282 • Fax: (714) 562-2758Email: [email protected] • Website: www.wcsg.comBusiness: Trucking services & hazardousmaterial hauling

white lion bonding & inSuranCe

ServiCeS, inC.247 Cedar StreetNewport Beach, CA 92663Justin KelleyPhone: (949) 400-5290 • Fax: (949) 612-0289 Email: [email protected]: www.whitelionins.comBusiness: Bonding

wood gutMann & bogart

inSuranCe brokerS

15901 Red Hill Ave Ste 100Tustin, CA 92780

Theresa FocardiPhone: (714) 505-7000 • Fax: (714) 573-1770Email: [email protected]: http://www.wgib.com/Business: Insurance & financial services

ADRModern alloyS, inC.11172 Western AvenueStanton, CA 90680Russ Gregory

Phone: (714) 893-0551 • Fax: (714) 895-9924 Email: [email protected]: www.modern-infrastructure.comBusiness: Highway construction services &materials.

to become a member of SCCa, please con-tact our headquarters by e-mailing in-quiries to [email protected] or bycalling (323) 726-3511.

SCCA STAFF ANNOUNCEMENT

Congratulations to SCCA Director of Administration Elvira “Evita” Campos.“SCCA thanks you for your 17 years of dedicated service and hard work!”

PASSINGSOur deepest sympathy for the passings of SCCA Members:Ken Lohrman, Owner, Lohrman TruckingCalvin B. Allen, Vulcan Materials


BONDED OVERLYING

CARRIER

SAKAIDA & SONS TRUCKINGP.O. BOX 7412 • VAN NUYS, CA 91409

BOTTOM DUMPS: IMPORT, EXPORT OF DIRT

TRANSFERS: SPECIALIZING IN SAND –

DRY, WASH, FILL ETC.

(818) 881-5257FAX: (818) 345-1994

TED SAKAIDA

OWNER

EQUAL OPPORTUNITY EMPLOYER

We ProvideEquipment forAll Your TrafficControl Needs.

Southern CaliforniaBarricades

Rental • ServicePickup & Delivery• Flashing Arrowboards• Light Towers• Beacons and Sign Lights• Cones and Delineators• Barricades and Lights• Rotating Beacons• Signs, Posts and Stands• Vests• Contractors Supplies

(800) 900-0722(SCB)

(562) 529-2600(714) 228-2135FAX: (714) 228-21376820 Orangethorpe, Suite C

Buena Park, CA 90620


p r o d u c t s & s e r v i c e s

Crane Rentals

Boring

Concrete ContractorsAggregates

Auction Services

YOUR AD HEREContact the SCCA Office

at (323) 726-3511


Drug and Alcohol Testing

LARRY NODLANDPresident

NOBEST INCORPORATEDGeneral Engineering Contractor • Lic. #359622P.O. Box 874, Westminster, CA 92684Phone: (714) 892-5583FAX: (714) 373-0039

Crane Rentals

Engineering Contractors

Equipment Rentals

Engineering Contractors


Insurance & Insurance Bonds

Excavating

GMGSGarrett/Mosier/Griffith/Sistrunk Insurance Services

12 TrumanIrvine, California 92620

949-559-6700800-414-7583

Fax: 949-559-6703CA License# 0884519

Website: www.garrett-mosier.com

Insurance, Surety Bonds & Risk ManagementSteven C. Mosier, CSP(Ret.), ARM John M. Garrett, CPCU949-559-3361 949-559-3362

Industrial Sales

Fuel/Lubricants

Fuel/Lubricants

Equipment Rentals


Legal Services

Screen Printing Services

Paving Services

Used Equipment

Trucking Services

Trucking Services


Allen Lawrence & Assoc. .............23

Anderson, L. D. .............................28

ARTBA ..........................................29

Atkinson, Andelson, Loya,

Ruud & Romo................................28

Blue Book .....................................27

Bragg Crane .................................17

Brutoco Engineering &

Construction, Inc. ...........................5

C.A. Rasmussen, Inc. ....................21

Carno & Carlton, LLP .................20

Coastline Equipment ......................2

Commercial Surety Bond............12

Cummins Cal Pacific ....................40

Diggerz ..........................................23

DripStop Eco-Containment

Products ........................................21

Gill & Baldwin ...............................20

Glenn Gelman &

Associates......................................16

Iron Planet ...................................39

LECET ...........................................33

LaLonde.........................................13

Marco Crane & Rigging ...............38

Marco Transport ...........................15

Mike Roche Inc. ............................17

Monte Collins Backhoe ...............23

National Ready Mixed

Concrete........................................30

Newman Backhoe ........................29

Northwest Excavating ...................4

Pacific Boring ...............................19

Pavement Recycling

Systems .........................................31

Pirih Productions .........................29

Quinn Company .............................8

R.S. Crow ......................................32

RAMCO ..........................................9

Riverside Construction Co. .........22

Rock Structures ...........................18

Sakaida & Sons Trucking .............32

Savala Equipment Rentals . .........21

Sequoia Consultants, Inc. ............24

Southern California

Barricades .....................................32

Southwest Explosives ..................28

Sukut Construction . ......................7

Sullivan Curtis Monroe ................32

Trench Shoring Co. ......................11

Tudor, M. R. ...................................18

• Operated and Maintained Service• Bare Rentals

• Crawler Cranes to 300 Tons• Conventional and Hydraulic Truck Cranes to 550 Tons• Concrete Pumps to 61 Meters in Arizona Locations

• Rough Terrain Cranes to 100 Tons• Certified Operators

LOCATIONS:Los Angeles: (562) 699-0664 • San Diego: (619) 938-8080

Phoenix: (602) 272-2671 • Tucson: (520) 748-8636Flagstaff: (928) 443-1478

Advert isers Index

sOUtHErN CALIFOrNIACONtrACtOrs AssOCIAtION INC.6055 E. Washington Blvd., suite 200Los Angeles, CA 90040

AddrEss sErVICE rEQUEstEd

prsrt stdU.s. pOstAGE

pAIdtucson, AZ

permit No. 541

southern california contractors association (scca) magazine: jan/feb 2012

Documents