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Industry Spotlight

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Interface Consulting Insight

In Construction Claims, A Picture is Worth More Than a Thousand Words

Christopher J. Sullivan, Interface Consulting International, Inc.

"The claimant typically has the burden of proof in preparing and proving its damages in construction claims....it is critical to illustrate in graphical form the nature of the claim."

"A stacked graph can illustrate the interrelationship between various items over time...."

"...A measles diagram illustrates the approximate location of various project problems, such as engineering errors, RFIs, or changes...."

Construction Disputes

Construction said to be worth €48m done without contract

The Irish Times

"The case relates to a...development...which included a hotel, supermarkets, town square, residences, offices and car parks."

"...Pierse director Michael O'Reilly said....'no standard forms of conditions of contract were discussed or agreed at any time.'"

"Mr. O'Reilly said €48 million was owed to Pierse arising from the increased scope of works, damages for breach of contract, extension of time and associated prolongation costs, disruption costs and acceleration costs for works carried out...."

Commissioners: We won't give up on dam

The Herald-Zeitung

"...memo states that the foundation material at the dam site varies from 'moderate to very poor quality,' and could lead to problems with 'stability, settlement, seepage and erosion under the structure.'"

"The original cost estimate was for $14 million. The construction bid was awarded at just more than $7 million."

"Because of the discrepancy, a contractual dispute over the amount of money the county owed to CH2M Hill boiled over in July 2009, and the county fired the engineering firm."

Developers of Ivy Hotel told to pay $7.1 million

Star Tribune

"An arbitration panel has ordered the developers of the upscale Ivy Hotel + Residence in downtown Minneapolis to pay $7.1 million to Bor-Son Construction and five other firms that claimed they were wrongfully terminated from the project."

"...the development...included renovating the historic Ivy Tower and constructing a 25-story condominium tower and a 19-story...Hotel. The developers and contractors agreed to binding arbitration after disagreeing on which one was responsible for delays and cost overruns."

"...lenders for the Ivy continue to seek to foreclose on the property. Built less than two years ago, the high-profile project fell victim to the depressed condominium and hotel market."

Construction Litigation

Afghan power plant hit by new allegations of impropriety

McClatchy Newspapers

"A $300 million power plant project in Afghanistan...plagued by delays and cost overruns is now under scrutiny because of allegations that a security contract was awarded improperly."

"In the complaint...Hart contends that Ian Cameron, corporate security manager for Black & Veatch, was involved in selecting his former employer, Blue Hackle, in violation of bidding regulations."

"'...How did Blue Hackle obtain the information necessary to present a winning bid, and did it do so through secret and unlawful communications with a LBG/B&V employee?' Hart said in its complaint."

Developer says contractor caused damage to Avenue District condo building

The Plain Dealer

"The developer of a downtown Cleveland condo building fired back today against a contractor who has filed to foreclose on the property."

"Zaremba, the developer...says Panzica Construction Co. and a subcontractor caused 'extensive water and flooding damage'....the developer said Panzica's actions delayed construction, causing 25 condo sales to fall through and putting Zaremba in default on its construction loans."

"Panzica, which claims it is owed $2.7 million for work on the building, filed a foreclosure lawsuit early this month...."

Construction Opportunities

U.S. DOT Set to Announce Over 50 TIGER Grants

The Bond Buyer

"The recipients of Transportation Investment Generating Economic Recovery, or TIGER, grants....will include large cities, rural areas, and tribal communities, with 60% of funds going to economically distressed areas...."

"The TIGER grant program was authorized by the American Recovery and Reinvestment Act to distribute $1.5 billion of grants for transportation projects...."

"...Senate Democrats unveiled a jobs agenda...that would expand TIGER grants to 'be used to upgrade several modes of transportation.'"

Construction Economics

Steel prices likely to rise further

The Star Online

"Steel prices are expected to jump a further 15% to 20%...as governments in East Asia restart spending on major infrastructure-related projects and restocking activities increase...."

"The higher cost of raw materials like iron ore and scrap metal, given the extreme cold winter, could also result in steel prices rising in the coming months."

"Malaysia, Indonesia, the Philippines, Singapore and Thailand are expected to spend a total of about RM102bil on infrastructure projects, financed by their economic stimulus packages."

Building sector in 'severe' recession

Belfast Telegraph

"Northern Ireland's construction industry is suffering the most across all the UK from a debilitating recession in the sector, according to a bleak survey."

"They blamed delays to public sector projects, delays in wind energy projects and fears of public spending cuts for spooking the industry and compounding fears for the future."

"'Investment in private sector construction has been significantly curtailed....Public sector work is therefore critical.'"

New Orleans awarded $45 million federal stimulus grant for new streetcar service

The Times-Picayune

"The city of New Orleans won a $45 million federal stimulus grant...to extend streetcar service from the Union Passenger Terminal to Canal Street, using Loyola Avenue."

"It was among 51 projects awarded grants under what the Department of Transportation called its TIGER grant competition. The grants, totaling about $1.5 billion nationwide, went to fund transportation projects with a preference for 'creative projects'...."

"Under the $45 million grant, the New Orleans Regional Transportation Authority has until Oct. 2010 to let construction contracts for the project."

Construction Management

$1 billion DFW Connector project will ease Grapevine highway mess, but the work will be painful

The Dallas Morning News

"Construction crews began work Wednesday on an enormously complex $1 billion highway project in Grapevine that will eventually smooth the daily commutes for hundreds of thousands of North Texas drivers...."

"The DFW Connector...will take more than four years to complete. It will untangle the famously traffic-clogged interchange between State Highway 114 and State Highway 121...."

"...the DFW Connector is among Texas' biggest examples yet of a new approach to building major infrastructure, a process known as design-build."

Engineering Innovations

Oregon is first U.S. site for a wave-power farm

USA Today

"Construction has begun off Oregon on what would be the nation's first commercial wave-energy farm....It is planned to supply energy to about 400 homes."

"The first buoy will measure 150 feet tall by 40 feet wide, weigh 200 tons and cost $4 million...."

"Nine more buoys are planned to deploy at a site in Reedsport, Ore., by 2012, at a total cost of $60 million...."

Engineering marvel taking shape near Hoover Dam

Associated Press

"A soaring 1,900-foot span across the gorge created by the Colorado River on the Arizona-Nevada border should be completed this fall...."

"When it is scheduled to open in November, motorists will cross the longest bridge of its kind in the western hemisphere, with towering concrete columns that rise above a twin rib arch beneath them."

"Construction began on the $240 million project nearly five years ago...."

Industry Spotlight

The Next Wave in Nuclear Power

A nuclear "reaction" of sorts is radiating through the American public following President Obama’s February 16 announcement to provide billions of dollars in loan guarantees for nuclear power projects. The guarantees are part of an agenda to promote low-carbon energy solutions, but some environmentalists worry about radioactive nuclear waste. Read on to learn more about this controversial topic as well as projects and cutting-edge technology in the works.

Obama pledges $8 billion for new nuclear reactors

Los Angeles Times

"...President Obama...pledged $8 billion in loan guarantees needed to build the first U.S. nuclear reactors in nearly three decades."

"The move, along with a tripling of nuclear loan guarantees in the president's budget, represents a new federal commitment to the low-carbon-emitting, but highly controversial, nuclear power sector...."

"...his administration would supply...loan guarantees to build two new reactors...in Burke, Ga., providing thousands of construction jobs in the next few years and about 800 permanent jobs in the years to come."

Small Reactors Generate Big Hopes

The Wall Street Journal

"A new type of nuclear reactor-smaller than a rail car and one tenth the cost of a big plant-is emerging as a contender to reshape the nation's resurgent nuclear power industry."

"Three big utilities...signed an agreement...committing to get the new reactor approved for commercial use in the U.S."

"...the utilities are betting that these smaller, simpler reactors can be manufactured quickly and installed at potentially dozens of existing nuclear sites or replace coal-fired plants that may become obsolete with looming emissions restrictions."

Obama's nuclear power push faces obstacle: Waste

CNN.com

"President Obama's announcement...of loan guarantees for nuclear power plants may encourage new construction, but a problem still remains...what to do with nuclear waste?"

"'We haven't found a solution for the 100 nuclear power plants operating,'.... 'And waste is building up on-site, with no solution.'"

"Currently, 70,000 tons of radioactive waste are stored at more than 100 nuclear sites around the country, and 2,000 tons are added every year."

A Reactor That Burns Depleted Fuel Emerges as a Potential 'Game Changer'

The New York Times

"...the traveling wave nuclear reactor is emerging as a potential 'game changer,' according to a U.S. Department of Energy official...."

"'We believe we've developed a new type of nuclear reactor that can represent a nearly infinite supply of low-cost energy, carbon-free energy for the world,'....If it can be built, a commercial version of the reactor is 15 years away or more...."

"The reactor design could power the United States for centuries and, if smaller, modular versions can be perfected, it could also provide affordable power for poorer nations that lack large-scale nuclear power infrastructure and power grids...."

US's Yucca Mountain nuclear project in meltdown

The Telegraph

"...the US Federal government has spent the last 22 years hollowing out the inside of a mountain....the Yucca Mountain project is about to be canned."

"Yucca Mountain was - and technically still is - the US's official repository for spent nuclear fuel rods. A series of tunnels 1,000 feet below the mountain surface has been carefully bored. The project...was expected to cost $96bn (£58bn) over its lifetime...."

"In his 2010 budget, President Obama delivered the lowest funding level yet...which eliminates all work on the design, construction and transportation infrastructure for the dump."

Toshiba invests in U.S. nuclear project

The New York Times

"NRG Energy...wants to build two reactors adjacent to the South Texas Project, 90 miles, or 145 kilometers, from Houston...."

"Toshiba, which makes the reactor that NRG wants to build, will invest $300 million, half for the South Texas Project reactors and half for development of additional reactors in North America...."

"The industry and the government are struggling to develop standard designs that can be reproduced economically...."

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