Public Works: Industry's Salvation
...the amount of funding the local and state agencies can fit into their already strained budgets.”
And the pressure those owners are feeling is being passed along, he says.
“The excess capacity of the contractors in this region is still the major problem,” Accetturo says. “We have experienced unprecedented pressure on pricing and profit levels for the last 12-18 months.”
Even so, Reynolds has been able to secure the $49.6-million Hood Road Water Treatment Plant Membrane Conversion in Palm Beach Gardens, Fla.; the $25.3-million Walnut Creek Water Reclamation Facility Phase II in McDonough, Ga.; and a $17-million expansion of a reverse-osmosis water treatment plant in Lake Worth, Fla.
Dunham with the AGC in Georgia, agrees that competition is tight. “The bidder’s lists are long,” he adds. “Even when they prequalify or short list, the short list can still have eight bidders on it.”
Turner’s Skidelsky in Orlando says it’s not unusual to see about 30 bidders for a school project, and owners short-listing seven or eight firms.
How Long Can it Last? Analyst Coskren of McGraw-Hill Construction forecasts that public construction will remain strong until “a retrenchment begins in 2011.
Doug Carlson, president of the Carolinas chapter of Associated Builders and Contractors, sees similar pain as long as the regional and national economy remains in the doldrums.
“All municipalities and the state are facing huge budget shortfalls because of the income and sales tax revenue shortfalls,” he says in an e-mail. “This will put a strain on planned projects possibly being cut or delayed.”
And Dunham in Georgia adds: “The state of Georgia’s No. 1 issue during this legislative session continues to be the budget. They’re looking at significant shortfalls.”
