The Professional Contractor Summer 2015 by The Warren Group

THE PROFESSIONAL

SUMMER 2015

A Publication of the Associated Subcontractors of Massachusetts, Inc.

The Sean Collier

MEMORIAL at MIT

When a project is built around collaboration, planning, and modularization, all the pieces will fall into place.

Visit Cannistraro.com to find out how our lean methods are changing the game.

THE PROFESSIONAL

A Publication of the Associated Subcontractors of Massachusetts, Inc.

16 The Sean Collier Memorial at MIT

cover story features

04 PRESIDENT’S VIEW The New Normal

06 INDUSTRY SPOTLIGHT Searching for Solutions

08 10

ACCOUNTING AND FINANCE WIP Not Simply a Compliance Schedule LEGAL BRIEFS Termination for Convenience: How Can I Be Fired When I Did Nothing Wrong?

22 GOLF TOURNAMENT 20th Anniversary Golf Tournament Is One to Remember 24 NEW IN DUCTWORK Building Owners Go Behind the Walls to Save Space and Reduce Expenses 26 TECHNOLOGY Biotech’s Growth Means Busy Times for Lab Furniture Contractors

28 MEMBER NEWS

12 SAFETY Plan for Safety 14 20

TAX TIPS 4 Common Tax Mistakes Contractors Make INSURANCE Coverage, Safety, Service The Professional Contractor

PRESIDENT’S VIEW

BY RICHARD R. FISHER

The New Normal

or the past two years, it has been my privilege to serve as president of the Associated Subcontractors of Massachusetts. Back in the fall of 2013, two years seemed an eternity … but as we know, time flies – and these two years certainly did! It has been a time of rapid change in our industry, as the recession is now finally just a memory and cranes once again dot the skyline in every direction. Today, ASM members are not only busy bidding and performing work – but also seeing margins improve, too (finally!). And instead of double-digit unemployment, we are once again worried about the aging workforce and shortage of skilled labor. As the industry returns to “normal,” it is a new normal in many respects – leaner and more efficient, and more receptive to the benefits of technology. In just the past two years, the use of smartphones and tablets has exploded across the industry, along with apps for every aspect of project management – from timekeeping to safety management, from plan markup to file sharing. BIM is no longer a luxury but the standard, and the principles of lean construction are catching on, too. These changes are reflected at ASM, where our technology show has become one of our most popular annual events. But at heart, the industry is still about people and relationships. Projects get built by people working cooperatively toward a common goal. At ASM, we have worked hard to foster those good relations, through events like our GC Showcase, but

also through joint legislative initiatives with our industry partners to improve industry procedures and promote best practices. In just the past two years, we have taken a leading role on several major issues affecting our industry – unemployment insurance reform in 2014 and implementation of the sick leave law in 2015 – in both cases joining with our partners to achieve substantive changes in response to industry concerns. Most important of all, however, is our success with AGC of Massachusetts in changing the decades-old practice of holding 10 percent of contractors’ funds as retainage – an amount that was too much, and held for too long. As I write this column in August, it is exactly one year since the new Retainage Law was signed into law, limiting retainage to 5 percent and establishing a carefully defined process and timeline for closing out a job. With the ink barely dry on the new law, there are already some who are calling for repeal, out of misplaced fears it will provoke disputes and delays. The same fears were raised with the Prompt Pay Law in 2010 – and to date there have been no problems. No doubt the same will hold true of Retainage – so let’s give the law a chance! As I close out my term, I want to thank all who have worked with us to better the industry over the past two years. I couldn’t be more proud of all we have accomplished, and I look forward to seeing the changes that are sure to take place in the years ahead, in both the industry, and at ASM. s

Richard R. Fisher is founder and president of Red Wing Construction in Beverly. He can be reached through ASM at (617) 742-3412 or by email at president@associatedsubs.com.

The Professional Contractor is published by The Associated Subcontractors of Massachusetts, Inc. 31 State Street | Fourth Floor | Boston, MA 02109 tel 617-742-3412 | fax 857-453-4338 mail@associatedsubs.com | www.associatedsubs.com

ASM Officers

President: President Elect: Vice President: Vice President: Treasurer: Past President:

Richard R. Fisher, Red Wing Construction Joseph H. Bodio, Lan-Tel Communications, Inc. Steven P. Kenney, N. B. Kenney Co. Inc. James B. Miller, Salem Glass Company Russell J. Anderson, Southeastern Metal Fabricators, Inc. David G. Cannistraro, J.C. Cannistraro, LLC

Summer 2015

ASM Directors

The Warren Group Design / Production / Advertising www.thewarrengroup.com custompubs@thewarrengroup.com ©2015 The Warren Group, Inc. and Associated Subcontractors of Massachusetts, Inc All rights reserved. The Warren Group is a trademark of The Warren Group Inc. No part of this publication may be reproduced in any form or by any means, electronic or mechanical, including photocopying, recording, or by any information storage and retrieval system, without written permission from the publisher.

Save the Date!

Thursday, October 29, 2015 6:00 – 9:30 PM

Biennial Dinner Gala & Elections Associated Subcontractors of Massachusetts

at Boston’s Museum of Science

GATHER WITH INDUSTRY COLLEAGUES for a memorable evening in a unique setting! See the newest Exhibits! Enjoy the finest cuisine Meet ASM’s new Officers & Directors Honor MA House Speaker Robert A. DeLeo Recognize special Award recipients

SPONSORSHIP OPPORTUNITIES AVAILABLE! Showcase your business to some of the best companies in the subcontracting industry.

For more information contact Associated Subcontractors of Massachusetts at 617-742-3412 or visit our website at www.associatedsubs.com

INDUSTRY SPOTLIGHT

BY CHRISTINA P. O’NEILL

Searching for Solutions Gladstone Appointed DCAMM Commissioner

arol Gladstone became commissioner of the Division of Capital Asset Management and Maintenance (DCAMM) effective Feb. 26. She has more than 35 years of experience in both public and private real estate. For the last two years before her appointment, she worked with nonprofit and government organizations as a principal at Stantec Consulting, an international architecture and engineering firm. In 2000, she co-founded GLC Development Resources LLC, providing real estate development and advisory services, and before that served as the assistant receiver for community and economic development for the city of Chelsea during the state receivership of that city. She also spent time in state government as the director of real estate for DCPO (the previous name for DCAMM). Following is an edited and condensed interview with Commissioner Gladstone.

side of the business who were focused on the dayto-day project delivery process. Some of the rewarding accomplishments at Beacon were the Hotel Meridien (now Langham Hotel) and Rowes Wharf in Boston. You couldn’t pick better projects. Rowes Wharf was such a seminal project for the city. I also served two and a half years in a role in the receivership of Chelsea. In a relatively short time we initiated things that became transformative; we rebuilt schools and brought the city back to financial health, with an incredible group of colleagues in a fast paced environment. I also spent 15 years on the Massachusetts State College Building Authority board of directors, becoming vice chair towards the end. There I was able to create a program of sustained investment in student facilities including dorms, dining halls and parking at our state university campuses. Our facility condition index is well into the ’90s. We maintained a sustained focus, not just on building new facilities, but reinvesting in existing ones. That long-term investment program is now self-supporting through student rents and fees. We now have a revenue model that allows us to continue making that investment.

What would you like subcontractors to know about your background and experience?

What are your goals/priorities for DCAMM, on behalf of the Baker Administration?

My career has been in real estate development, in the building part of our industry. I love the sweep of the process of design and construction. My current job requires integrating all the different pieces, tying together user needs, the money, the design, the building, the operations, the permitting, integrating all these different influences and forces, to create something great. It’s something different every day.

I have a series of goals to improve the administration of our capital program. The Baker Administration’s focus is on investing capital dollars to address existing maintenance priorities and renew existing buildings, to make better use of the intrinsic value in our current real estate and building portfolio … and I think people are going to start to see that. A building built 30 years ago can’t meet today’s needs in its original condition, but very often there are some great design solutions for repurposing buildings to get you contemporary spaces; those are the kinds of solutions we’re looking for.

What have been some of your most significant and personally rewarding accomplishments prior to DCAMM? I started my career with Beacon Companies, which was probably the preeminent real estate company in Boston with its own construction company (Beacon Construction). I worked for Norman Leventhal and Ed Sidman, but also worked very closely with other Beacon people on the building 6

Summer 2015

What do you see as the greatest challenges facing DCAMM in the year(s) ahead? There’s been a lack of investment in infrastructure and buildings and the commonwealth is now trying to get ahead of this. It’s not just an issue

here but across the country. There’s only so much capital available for this purpose, and our challenge is to deal with those limits. Anything subcontractors can do to help us achieve more with our limited resources is very much invited.

How is technology changing how things are done internally at DCAMM? Technology offers ways to improve administrative processes that are entirely under our control, so that we can function better and provide better service to our client agencies and contractor partners. Some of the areas where we’re focusing on improvement include paying people on time, closing out projects more efficiently and implementing a more efficient, streamlined process for certification and prequalification of contractors and subcontractors. We are in the process now of developing a certification system that will be entirely online, which should make submission of applications and update statements much easier for contractors and subcontractors.

How is technology changing procurement and construction methods at DCAMM? We’re migrating to Building Information Modeling and beginning to use BIM protocols on some of our projects. That rollout will accelerate in the months ahead. We are also developing an electronic plan room that’s expected to be ready by the end of the year, and will allow access to plans and specifications online, in addition to our current way of providing them on CD or paper.

What advice would you give to subcontractors who would like to do business with DCAMM? We procure close to $400 million in construction and design services annually, and we try to create a range of opportunities for firms of all different types and sizes to work with the commonwealth. Our website has information on how to get certified either as a prime contractor or subcontractor. We also have a new small project contractor certification program that we hope makes it easier for emerging businesses to get started in doing public work at the state or local level. We recommend tracking goods and services needs on the web site www.commbuys.com, which presents opportunities not only for DCAMM but for other agencies as well. And last but not least, we encourage contractors in the MEP and energy-related fields to take a look at contract opportunities in our Accelerated Energy Program, which includes energy-savings projects across the commonwealth that are highly varied in size and scope.

Is there anything else you would like contractors and subcontractors to know about DCAMM? One of our goals this year is to structure our procurement process to encourage more participation by small contractors, including minorities and women-owned businesses. We have been trying over time to put programs in place to help do that, which is a continued focus of the governor’s office. I want to thank ASM for being a partner in this effort, and look forward to continuing to work with you on an issue so important to all of us, to provide opportunities for small businesses across the commonwealth. s

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The Professional Contractor

ACCOUNTING AND FINANCE

BY DAN STANHOPE, CPA

WIP Not Simply a Compliance Schedule

or contractors, the work-in-process (WIP) schedule is part of a fundamental dashboard used to determine revenues and gross profit that should be included in your regular, monthly reporting package. The WIP schedule provides a snapshot at a point in time of where your profitability stands on a job-by-job basis and can provide assurance that your contract revenue, contract costs, underbillings and overbillings reconcile to your profit and loss statement (P&L) and balance sheet. But the WIP schedule can be much more than a report to track the progress and financial performance of uncompleted projects throughout a specified time. The WIP schedule provides contractors with a big picture view of performance indicators for individual contracts and company-wide for all contracts, and can provide strategic insight for informed decision-making. The WIP schedule tracks key project data, including: contract value, costs incurred to date, total estimated costs and project billings. Statement users (e.g. CFOs, accountants, bankers, bond agents) are able look at the WIP schedule at the end of a reporting period (monthly, quarterly or annually) and understand a great deal about job performance/ company performance and glean insight from performance indicators, such as: underbillings, overbillings, profit fade or spike, over/under applied burden, backlog on hand, as well as performance by different criteria. The best WIPs strategically monitor key performance indicators and allow decision makers to reveal issues and trends affecting profitability.

Key Performance Indicators Underbillings: While these are categorized as Dan Stanhope, CPA, is a manager at AAFCPAs based in Westborough, Boston and Wellesley, Mass. He has over 10 years of experience providing tax, assurance and business advisory solutions to the construction industry. Dan can be reached at 774-512-4134 and at dstanhope@aafcpa.com.

Summer 2015

Figure 1: Job Borrow Illustration Contract price

$100,000

Estimated Costs

$90,000

Estimated gross profit

$10,000

Billings to date

$80,000

Costs to date

$60,000

Billings over costs

$20,000

Job Borrow

$10,000

an asset on the balance sheet and are classified as “costs and estimated earnings in excess of billings on uncompleted contracts,” underbillings can be a sign of billing department issues, profit erosion not yet recognized or unapproved change orders. There are some instances where underbillings are to be expected – typically in the early stage of a project or possibly resulting from timing issue such as delays in invoicing from subcontractors or vendors. However, as a project progresses, underbillings become more of an item to monitor because they can put contractors in a position where they are financing the project and putting a strain on cash flow. Overbillings and job borrow: In general, it is better to be overbilled than underbilled. Cash flow will be healthier and contractors can avoid the need to fall back on a line of credit. Overbillings are categorized as a liability on the balance sheet and are classified as “billings in excess of costs and estimated earnings on uncompleted contracts.” However, be aware that you may be “borrowing” from the job. Job borrow is when you have billed more than the costs you have incurred to date, and the difference is in excess of the total gross profit you will earn on the project. Sureties monitor job borrow closely because they see this as a sign that you are borrowing from one job to pay for another. They compare the job borrow against your cash balance to make sure you have the cash on hand to pay for your finishing costs. For example, consider a contract price of $100,000 where you expect to make $10,000 of gross profit or 10 percent on a job. If you have billed $80,000 year-to-date and incurred $60,000 in costs, you have borrowed $10,000 from this job (i.e. $80,000 (billings) - $60,000 (costs to date) $10,000 (gross profit) = job borrow of $10,000). So you have $20,000 of cash (assuming you collect your receivables) that is over and above the costs you have incurred, and of that amount $10,000 represents profit you will retain; you will need the other $10,000 for costs to finish the project. If you use this

overbilling on selling, general and administrative (SG&A) expenditures, you won’t have the cash to finish the project (see Job Borrow Illustration – Figure 1). Again, while you want to finance the project with as little of your own money as possible, you don’t want to find yourself constantly borrowing from one job to pay for the next. If your cash balance gets below this “job borrow” as a result of financing overhead and other projects, your surety may question your bonding capacity. Profit fade/spike: Profit fade is often a sign of mismanaged jobs or poor estimates. Contractors experiencing cost overruns should regularly review job cost reports to identify causes. Profit fade also results in jobs being misreported in prior periods. Surety or banking decisions may have been approved or declined based on these results. Conversely, if you are always recognizing profit spike at the end of projects, your estimates may be too conservative throughout project life cycles. Margins on open and closed jobs should be in the same ballpark. If margins on open jobs are higher than closed jobs, you could be too optimistic. This can have a negative effect on the way a surety portrays your books, but it could also impact the income taxes and interest you are paying the IRS. Over/under applied burden: Burden represents indirect costs of performing contract work. Examples of these types of costs would be depreciation on fleet vehicles, gas, small tools, insurance, etc. It is very important to reconcile the costs in the WIP schedule back to the P&L and analyze your over/under applied burden. Allocation of burden is critical to ensure there is an accurate depiction of the jobs in the WIP schedule. If the WIP schedule total gross profit percentage doesn’t closely mirror what is reported on the P&L, your WIP loses credibility. Your WIP schedule must include realistic burden rates if it’s to be taken seriously by surety underwriters, bonding agents and bankers, and if it’s to be of strategic use to your management team. Backlog on hand: By rolling out the backlog on a job-by-job basis, you are able to plan company results on a monthly or quarterly basis. This planning is important for management/owners to

ensure they are making informed, strategic business decisions. Additionally, an accurate backlog projection is extremely useful for business development personnel as it can help them to identify peaks or valleys in workload, and they can then focus on developing business to fill those gaps. If you are flush with work, you may be selective and cherry pick projects or price work at a premium during peak times. If times are slow, you may decide to sharpen the pencil and go in a little leaner to win work in an effort to keep your labor force busy. The performance indicators mentioned above provide validity to the backlog roll out. You can then measure actual results against the roll out to fine tune the process. Setting goals and measuring them will also help drive results and profitability. If you have problems with your WIP schedule, owners, CFOs and CPAs will not be able to make informed decisions based on the backlog roll out projections. The WIP schedule can be a powerful tool to reveal inefficiencies in construction operations, to better understand company performance and factors affect-

ing profitability. Strategically-designed WIP schedules include both standard and variable descriptive columns that clearly highlight the significant details of all contracts in process and better enable meaningful analysis. Regular WIP analyses can support construction business profitability, and help contractors focus on areas of profitability, including: projects by type, size or location with consistent profit margins, key members of your team who contribute to profitability, contractors who are consistent and fair and vendors who deliver value. AAFCPAs has provided a sample WIP schedule template available at www.aafcpa.com/wip2015, which includes some standard, predefined columns that will be helpful for many contractors to utilize in measuring and analyzing their WIP results. However, we strongly advise against a boilerplate WIP schedule. Based on your specific needs, the WIP should be tailored for the best and most meaningful results. Don’t hesitate to contact us if you have any questions about your workin-process schedule or need additional information. s

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The Professional Contractor

LEGAL BRIEFS

BY CHARLES F. AHERN III, ESQ.

Termination for Convenience: How Can I Be Fired When I Did Nothing Wrong?

uppose you own a well-established subcontracting firm that just got the “last look” at a multimillion-dollar, highly visible downtown highrise renovation project that could lead to fantastic growth opportunities in the future. You find out you are the successful bidder for your trade. The general contractor then sends you a proposed subcontract, and you sign it without any revisions and the subcontract contains a termination for convenience clause.1 You then start work on submittals, order your equipment and allocate manpower to the project. You eventually mobilize and physically complete about half of your work. You then get a letter from the general contractor saying that it is terminating your subcontract under the subcontract’s termination for convenience provision. Can the general contractor unilaterally terminate your subcontract even though you have never breached the subcontract and you are not currently in default? The answer to this question ultimately depends on a court’s or arbitrator’s analysis of the reasons for the termination. If the above hypothetical involved a federal government wartime contract, the answer would be fairly easy. That is so because, historically, termination for convenience clauses arose at the end of the Civil War to allow the Union government to stop military production contracts and to pay for products already manufactured and for work already completed at the time of termination. The rationale was that continuing with wartime contracts (and payments on those contracts) when the war was winding down was clearly against the public interest. That rationale expanded during subsequent wars, where termination for convenience clauses were used in virtually all military procurement contracts. Courts have routinely upheld the use of termination for convenience clauses by the government where, such as the end of a war, circumstances had changed so dramatically that it clearly would be Charles F. Ahern III is a partner at Corwin & Corwin LLP, one of the only law firms in New England dedicated solely to construction law, and counsel to ASM since 1950. He may be reached at 617-742-3420 or by email, cfa@corwinlaw.com.

Summer 2015

against the public interest not to enforce the clauses. Outside the military context, there have been some federal courts who have also required the government to show a material change in circumstances before enforcing a termination for convenience clause. However, the current general rule is that a termination for convenience clause in any government contract will be enforced by courts unless “bad faith” or an “abuse of discretion” can be shown or the termination was made under circumstances that violated notions of full and open competition. Unfortunately for contractors, courts have held that a contractor’s burden to show the government acted in bad faith is “very weighty.” And the reality is that few contractors have been able to demonstrate bad faith in the public contracting arena. But what about the enforceability of termination for convenience clauses in private construction? There aren’t many published state court decisions addressing the enforceability of termination for convenience clauses between private construction parties.2 However, the published cases do indicate that most state courts will follow federal guidance and enforce termination for convenience clauses unless it can be shown the party enforcing the clause has acted in bad faith and/or arbitrarily and capriciously. There is also some decisional law that indicates some state courts might be less willing to enforce termination for convenience clauses in the private sector where there is not a compelling public interest involved. The bottom-line is that whether or not a court will enforce a termination for convenience clause in either the public or private construction sector will likely turn in large part on a factual determination on whether the terminating party acted in bad faith. Assuming there has been a termination for convenience, what are the contractor’s remedies arising from that termination? Traditionally, a contractor’s recovery has been limited to its demobilization costs and earned profit from completed work. Some standard construction industry contracts, such as the AIA documents, specifically allow recovery of overhead and profit on the remaining uncompleted work. Absent a contractual provision to the contrary, a contractor should be allowed to seek its anticipat-

ed overhead and profit on uncompleted work. A contractor would prove that measure of damages by showing its historical overhead and profit on similar projects and by disclosing its specific estimate for the project at issue. Depending upon the applicable jurisdiction, a contractor may also be entitled to recover punitive damages upon a finding that the termination of its contract was made in bad faith. What can a contractor do to address the potential impact of a termination for convenience clause? There are historically three ways of dealing with these clauses. The first, of course, is to negotiate the termination for convenience provision out of any applicable contract documents. Obviously, this is easier said than done and many owners and contractors will refuse to strike a termination for convenience clause. The second and more common option is to require that the other party agree to allow the contractor the same right of terminating the contract for its own convenience. If the other party can end the contract with impunity, it is only fair that the contractor enjoy that same right. The third way to lessen the impact of a termination for convenience clause is to allow for the recovery of overhead and anticipated profits on uncompleted work. Whether any of these options is available to the contractor will likely depend on the relationship between the parties and whether or not the contractor has any negotiating leverage. s

You put building first.

Footnotes 1. Construction contracts routinely have termination for convenience clauses like that found in the AIA A201 (2007) which provides, in pertinent part: The owner may, at any time, terminate the contract for the owner’s convenience and without cause. Upon receipt of written notice from the owner of such termination for the owner’s convenience, the contractor shall 1. cease operations as directed by the owner in the notice; 2. take actions necessary, or that the owner may direct, for the protection and preservation of the work; and 3. except for work directed to be performed prior to the effective date of termination stated in the notice, terminate all existing subcontracts and purchase orders and enter into no further subcontracts and purchase orders. 2. For example, there appears to be only one relatively recent Massachusetts published case dealing with the enforceability of a termination for convenience clause and it involved a sheriff’s termination of a lease. The court never even reached the issue of bad faith because the court found that the sheriff’s loss of funding constituted an “inconvenience” which justified termination of the lease. It does appear, however, that had there been no loss of funding the court would have done a bad faith analysis of the termination.

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The Professional Contractor

SAFETY

BY TOM PALANGE

Plan for Safety

Cannistraro’s Approach to Developing a Positive Safety Culture

egardless of trade, discipline or job function, all construction companies share the common goal of creating a safe work environment for their employees. In fact, safety is more than a goal for most companies; it’s both a priority and a responsibility. A true commitment to safety, however, requires more than a promise. It requires careful planning, observation and open communication across the entire organization. For more than 50 years Cannistraro has emphasized the importance of safety on every project by empowering its onsite management to lead the safety discussion based upon the distinctive traits and scope of their individual projects. While project foremen held weekly Toolbox Talks, representatives from the company’s safety department traveled to jobsites and enforced the companyapproved Environmental Health and Safety Policy. Tom Palange is the director of marketing for J.C. Cannistraro, LLC, an industry-leading mechanical construction firm in the Greater Boston area. He can be reached via email at tpalange@ cannistraro.com.

Summer 2015

Cannistraro’s safety efforts were standard industry practices, yet as the company came to find out, it was missing a critical component. As the Boston construction market rebounded from the recession and man hours in the field increased, so did the number of recordable injuries. This trend demonstrated that employees were getting hurt at work, an unfortunate fact that was simply unacceptable. Cannistraro approached the problem head-on through research and analysis of historical data. Every employee who was involved in an incident over a two-year period was interviewed in order to understand exactly what went wrong. These faceto-face interviews yielded specific details including the time of day that the injury occurred, the jobsite conditions surrounding the work area, what task was being performed and what area of the body was affected. Simultaneously, the company asked for feedback from field staff through surveys about its day-to-day safety practices and the real-life application of the company’s safety program. Once all of the data was collected, management on every level was informed of the results and some eye-opening themes became clear. The data showed

that more than 50 percent of Cannistraro incidents over the two-year span were from strains, sprains and cuts – in other words, preventable injuries. Further examination of past incidents told stories of improper tool and equipment use, the need for appropriate hand and eyewear, and an overwhelming yet unspoken pressure to cut safety corners due to tight schedules and deadlines. By and large, the feedback indicated that Cannistraro had already put into place ample resources for employees to work safely, but it had not reinforced the need for good safety habits through communication. To remedy the situation and rebuild a strong safety culture across the entire company, Cannistraro leadership jumped into action with a multifaceted approach that included more detailed planning, regular training and education and open channels for communication. Cannistraro’s first response was to address the preventable injuries with smart, new policies and a closer examination of employees’ personal protection equipment (PPE). The company mandated a strict eyewear and glove policy for all employees on every project. Moving forward, every Cannistraro field employee would receive his/her own comprehensive PPE kit, not only with the traditional hardhat, but with multiple types of cut-rated gloves and four kinds of protective eyewear, as well as high-visibility shirts and vests. It was also important to foster supportive, trusting relationships between the field and the safety team, so Cannistraro laid the groundwork for a safety feedback program where employees can easily provide safety equipment suggestions or alert the company of any safety issues or concerns. In the spirit of better safety communication, the company reaffirmed its safety promise by becoming an active, annual participant in Safety Week, a nationwide initiative to raise safety awareness in construction. As part of its robust Safety Week schedule, Cannistraro’s executive leadership team hosted safety summits at all of the company’s largest jobsites.

Management joined the onsite teams in a pilot “stretch and flex” program to help employees loosen up their muscles before work, and personally explained the company’s new policies. Subsequently, the company initiated an “Executive Safety Walk” program, which ensured that the firm’s top leaders got out to jobsites on a regular basis to stay engaged in the safety culture and be accessible to field personnel. New safety leadership and a consistent, positive message also helped to drive better safety communication across the company. Since joining the Cannistraro team, Director of Environmental Health & Safety Justin Azbill has rolled out a comprehensive pre-task plan program, a monthly foreman training program and a custom-designed safety app that helps foremen and project managers better manage safety in the field by providing instant iPad and iPhone access to current and archived toolbox talks, safety videos, pre-task plans and job

hazard analysis forms. By the end of the year, he also plans to award one lucky, safe-working employee with a Harley Davidson motorcycle as the grand prize for Cannistraro’s new Safety Recognition program, which rewards good safety decision making throughout the year. While building a safety culture inside an organization takes time, the new process is yielding results for Cannistraro. Since its re-emphasis on safety planning and communication, the company is reporting a decrease in injuries as well as stronger safety ratings, but the firm is committed to continuous improvement. Cannistraro’s next step is to roll out field identification badges for all field personnel and hardhat decals with custom electronic barcodes that enable a user to instantly find an employee’s emergency information. By turning to data, communication and employee engagement, Cannistraro is inspiring its employees to “Plan – Work – Live Safe,” and the message seems to be sinking in. s

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The Professional Contractor

TAX TIPS

BY VINCENZO BOTTA, CPA, CGMA

4 Common Tax Mistakes Contractors Make How You May Be Overlooking Potential Tax Deductions and Credits

t’s a familiar scenario. On a day-to-day basis, owners and managers of contracting firms do what they need to do to keep the business running. Whether it’s purchasing a new piece of equipment to replace an outdated one or hiring extra help to handle a brand new project, they tend to focus on “taking care of business” now and put off thinking about the tax consequences until later. But doing so often comes at a cost. Here are four tax mistakes that contractors commonly make, some that can leave serious money on the table – or worse, land you in trouble with the tax authorities.

1. Failing to Depreciate New Equipment Correctly Depending on the whims of Congress, this could be a two-part opportunity to decrease taxable income by a significant amount in 2015. One tax provision – Section 179 – is currently in force; the other – Section 168k – expired last year but may be extended by Congress before year-end. Section 179 allows for an immediate tax depreciation deduction of the entire cost of equipment and machinery in the year it is placed into service. Although not all property, plant and equipment purchases are included, all construction equipment and machinery purchases are allowed. Total purchases must be less than $200,000 to receive the full benefit of $25,000. Anything over $200,000 in purchases is a dollar-for-dollar decrease in Section 179 tax depreciation expense. However, this provision should be monitored as the year goes along. Congress has the option to extend the 2014 amounts of $500,000 in total Section 179 depreciation on up to $2 million in purchases, which would certainly result in even bigger tax savings in 2015. Vinny Botta is a principal in the Boston-area CPA and business advisory firm Rucci, Bardaro & Falzone, PC in Malden, Mass. Through the firm’s Construction Business Services Group, he offers tax planning advice and services to the owners and managers of contracting firms of all sizes. For a complimentary copy of “Employee vs. Independent Contractor: 7 Tips for Business Owners,” contact Botta at 781-321-6065 or vincenzob@rbfpc.com.

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Another tax benefit that should be monitored this year is the revival of Section 168k or “bonus depreciation” provision. Until the end of 2014, this allowed for an immediate 50 percent tax depreciation expense in the year of purchase on certain property, plant and equipment purchases. As mentioned, Congress has the option to extend this provision into 2015, just as it did a year earlier when it voted to keep it in force for another year.

2. Overlooking the Fuel Tax Credit Many contractors miss out on this one. Either they are unaware that it exists, or are unsure if they qualify for it. But the tax savings can be substantial. More valuable than a tax deduction, a tax credit of any kind is a direct decrease of your tax liability. This particular credit is for federal taxes paid on fuels. The credit applies to various types of fuels, but the two that normally pertain to contractors are the off-highway business use of gasoline in machinery and trucks, and the use of undyed diesel fuel. To take advantage of the fuel credit, your company’s use of these two types of fuels should be tracked throughout the year. The credit is based on total number of gallons used and can range from 18 – 25 cents per gallon.

3. Overlooking the Domestic Production Activity Deduction The domestic production activity deduction (DPAD) is a little-known method to decrease taxable income that doesn’t pertain to all industries; however, construction companies are one of the few that do often benefit. The deduction is based on 9 percent of “qualified production activities income” from U.S. based operations. To make sure the credit is taken accurately, it is generally a good idea to invest some effort ahead of time to have the proper cost accounting mechanisms in place. These will help you distinguish between qualified and nonqualified production activities. Proper tracking of revenue from various construction services (and the expenses that go along with it) is critical. If the deduction is taken on nonqualified activities, a restatement of taxable income may be required in future years, and the additional taxes due may also be subject to penalties and interest.

4. Misclassifying Employees as Independent Contractors Should the people working on your jobs be issued a W-2 or a 1099? This question causes confusion for employers across the board, but especially for those in the construction trades. Many contractors would understandably like the answer to be the latter in order to avoid paying the employer portion of taxes, unemployment insurance and W-2 filings – costs which when combined can approach 20 percent of wages. Unfortunately, the decision is not based on what the employer would like to save or what the employer believes the person may be. The decision must be made according to (among other things) who has “con-

trol” of the employee or independent contractor for the work that the individual is performing. A 1099 individual (independent contractor) has control over the work they do. They are hired independently of the company’s own workforce to perform a specific job, and they – not the employer – control the completion of that task. A 1099 independent contractor must also perform work that is “outside the usual course of business” of the employer. No individual who performs the same work as the employer’s own workers can be treated as an independent contractor. Still, some companies decide to classify what should be a W-2 employee as a 1099 independent

contractor under the mistaken belief that the consequences for misclassification are minimal. Not true. If an employee qualifies as a W-2 employee by law but is not paid that way, the penalties for the improper filing can run into the hundreds and sometimes thousands of dollars – per employee. Although the up-front cost savings of issuing a 1099 rather than a W-2 is certainly tempting, the potential penalties in the long run – including increased scrutiny by federal and state tax authorities – are just not worth the risk. That’s why it pays to take the correct steps at the beginning of a worker’s engagement with your company to ensure that he or she is classified properly. s

The Professional Contractor

The Sean Collier Memorial at MIT A Builderâ&#x20AC;&#x2122;s Perspective

By Robert Asmar

When I first learned of the death of Sean Collier (the MIT Police Officer shot by the Boston Marathon bombers on April 18, 2013), I was watching the news with my wife and thought to myself, “I know that guy.” With the many projects we have done at MIT over the years, I think our paths crossed on occasion, and we nodded in passing. So on May 5, 2014, when I was asked if Phoenix Bay State Construction (PBS) would like to get involved in constructing Sean’s memorial as the stone erector, I couldn’t have been more enthused and excited. I have felt an inexplicable connection to Sean from the time I learned of his tragic death, and this project has had a very special meaning to me. The structure was unlike any we had encountered in the 45 years Phoenix Bay State has been in business. I studied the drawings through a number of changes then got Joe Goncalves, our extremely talented, outside superintendent involved. Together, we attended many meetings and tele-conferences with the MIT design and engineering teams – which included, among many others, J. Meejin Yoon of Howeler + Yoon Architecture LLP together with Specialty Masonry Consultant, Professor John Ochsendorf, Ph.D., and his team at Ochsendorf, DeJong and Block Consulting Engineers, and Construction Manager, Suffolk Construction. We were also assisted by Mike DeBlasio, a friend and colleague for over 40 years, who was a big part of our team, and Mike Grafe, P.E., of C.A Pretzer Associates. When we first put our PBS team together, I told Joe that I wanted to be looking in their eyes when we first showed them the drawings and renderings. It would take a few minutes for the sheer enormity of the memorial stones to set in and when it did, I needed to see with my own eyes the excitement or the fear, the confidence or the doubt that would surely be in their eyes. I was not disappointed; I could see they were as excited and confident as I was. We would not have been able to successfully accomplish this unprecedented, complex project if every one of us was not 100 percent all in. The structure consisted of 32 solid pieces of granite ranging in weight from 6,900 to 22,000 lbs. Beginning in July 2014, we spent the first seven months planning and preparing to handle stones of this size and volume. The PBS team, led by Joe and a hand-picked team of craftsmen, practiced moving and maneuvering a very large piece of stone that we had in our yard. Although it wasn’t quite as heavy or awkwardly shaped as some of the actual memorial stones, it gave our team a chance to experience firsthand the type of effort it was going to take to successfully perform this project. Finally, we were ready. One of the challenges we encountered constructing the Sean Collier Memorial, and there were a few, was placing the keystone. Normally, in the process of constructing an arch, the keystone is the last stone or unit to be installed. Here, we chose to install the keystone first because of the unconventional nature of the arch and the keystone itself. Since the keystone in this structure was not the standard wedge-shaped stone that filled the last space, allowing the remaining stones to settle in against it, we needed to completely modify our continued on page 18

Sean Collier Memorial at MIT Construction Details • The memorial is composed of 32 solid blocks of granite, which form a five-way stone vault, each block supporting the other to create a central covered space for reflection. • 319 tons of stone were quarried in Virginia. • 196 tons of stone were fabricated in Wisconsin. • 671 skateboard studs are placed at the base of the memorial to deter skateboarders; these form a repeated pattern of “179” in Braille. • 27 point lights set into the pavers permanently inscribe into the ground of the memorial the constellation of stars that were overhead in the night sky on April 18, 2013. • 34 mini piles support the memorial. • 315 cubic yards of concrete were poured. • 108 inches of snow fell during construction. • 18 tons of rebar were laid beneath the memorial. • Amidst the solid stone memorial are a cluster of honey locust trees which create a living canopy above the structure to mark the passage of time and evoke the spirit of the forest, a place Sean loved.

Project Design Team • Design: Professor J. Meejin Yoon • Architect of Record: Höweler + Yoon Architecture LLP • Specialty Masonry Consultant: Ochsendorf DeJong and Block Consulting Engineers • Structural Engineer of Record: Knippers HelbigAdvanced Engineering • Landscape Architect: Richard Burck Associates • Civil Engineer: Nitsch Engineering • Geotechnical Engineer: McPhail Associates • Lighting Designer: Horton Lees Brogden Lighting Design • Electrical Engineer: AHA Consulting Engineers • Typographic Consultant: Francesca Bolognini

Construction Team • Construction Manager: Suffolk Construction • Stone Fabricator: Quarra Stone Company, LLC • Granite Erector: Phoenix Bay State Construction Company • Granite Supplier (Quarry): Virginia Mist Group • Landscape Contractor: Valleycrest Landscape Development • Granite and Field Surveyor: Feldman Land Surveyors • Geotechnical Construction Company: Hayward Baker • Concrete Placement: G&C Concrete Construction • Paver Supplier: Hanover Pavers • Electrical Contractor: Gaston Electrical Co. Inc. • Construction Labor: Liberty Construction • Site Development Contractor: James W. Flett Co. Inc. (excavation work)

The Professional Contractor

The Sean Collier Memorial at MIT continued from page 17

standard installation practices to account for its uniqueness. This keystone is a five-sided stone with a continuous projecting shelf around the upper perimeter that is designed to bear on the surrounding vault stones’ lower projecting shelves. By installing the keystone first, the luxury of setting it down on the surrounding stones did not exist. There were no other stones. With the expert assistance of Feldman Engineering, we were able to position the five points of the keystone in time and space approximately 12 feet in the air in their precise locations for height, orientation and direction. The exact placement of the keystone was critical in that each of its five sides represents the location in both height and direction that the five outward fingers of the structure would originate. If even one point of the keystone was oriented incorrectly in any direction or height, the error could be compounded when we extended the fingers outward to as much as nearly 40 feet. For this reason it took almost three days to set the keystone in its exact position. Another challenge was installing the surrounding vault stones. We needed to gently maneuver these incredibly awkward-shaped stones, some weighing over 10,000 pounds, to their proper location abutting the keystone using nylon straps only, as we did not drill any holes for any type of lifting pins or eye bolts. Not only that, but once they were placed against the keystone with only a quarter of an inch joint between the stones, we then needed to lift the stones so that their bottom-projecting shelves would engage the upperprojecting shelf of the keystone. And we had to do all of this while trying not to tap the keystone with a very heavy stone, which could have easily displaced it from its original position. Adding to the difficulty was that the vault stones are all also very unique shapes. They weren’t square or rectangular. Some were two feet in height on one end and over four feet on the other end and had wide or narrow centers, which made it very difficult to find and utilize the center of gravity for lifting purposes. Being irregular shapes, we had to keep one end higher than the other as we approached the keystone. After placing each of the stones to its precise position around the keystone and lifting it gently to allow the shelving system of each stone to engage, we would then have to re-check all five points of the keystone to insure we had not moved it. Once an 8- to 10,000-pound stone is placed on a structural shoring system 10 or 12 feet in the air, it has a tendency to want to sway ever so slightly, which made exact placement very difficult. 18

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As a further challenge, the MIT engineering team requested that we place the shoring scaffolding onto your average everyday, 10,000-pound bathroom scales to monitor the stone movement when the time came. The next challenge was keeping the “vault” and keystone together as one unit. The vault consists of the keystone surrounded by the five stones from where the outward fingers begin. This vault or arch roof was also unusually flat, adding to the difficulty of maintaining consistency. Because we started from the “inside out,” with the keystone being the highest point of the arch structure, the vault stones’ natural shape and direction was gently downward, away from the keystone. The slight downward shapes together with gravity gave the installed vault stone a natural tendency to want to “relax” away from the keystone. We came up with a system of spider webbing or cradling the entire vault and keystone with a series of straps from one stone to another in a sort of criss-cross pattern while posts and jacks pushed in from the sides to keep the vault stones tight to the keystone. Believe me, keeping six very large separate stones, shaped like a near flat umbrella and totaling almost 60,000 pounds, together as one unit in mid-air was no easy task! While in this position, the outer fingers were then constructed against the vault in its somewhat compressed position. Our thinking was that when the straps and posts were eventually removed, the fingers would take over to maintain the vaults’ compression and discourage premature gravitational deflection. Once all of the outer fingers were completed, the vault would theoretically be supported by the five buttressing finger walls. However, with all of the structural shoring still in place under the vault and keystone, together with the engineering team we decided that the joints of the finger stones should be grouted for stability in supporting the vault and keystone. Once the grouting was completed and cured, it was finally time to lower all of the shoring and allow the vault and keystone to truly transfer its weight to the outer fingers. During the course of almost eight hours, the cradling straps and side shores were removed and the structural shoring was systematically lowered until approximately 96 percent of the vault and keystone weight was now being supported by the five outward fingers. We knew this because of the scales that we had placed under the shoring staging legs that carried the weight of the vault. Over the long course of lowering the shoring jacks, the scales were being monitored by the MIT engineering team.

As we lowered groups of four to six jacks simultaneously, approximately one tenth of a turn on the jack, you could visually watch hundreds of pounds at a time come off the scales while transferring to the finger stones. With every slight turn of the jacks, the enormous weight of the vault and keystone was shifting from the jacks to the arch, supported by the outer finger stones, exactly as it was designed to do. The final grouting of the one quarter inch joints in the vault and keystone could now be completed. This was truly an extremely difficult and unprecedented job, well done! There were a few reasons we decided with the MIT architectural and engineering teams to construct the memorial from the inside out. One being, if we were off in our placement of stones even the slightest amount, the compounded error would have become evident early, in time to make adjustments in dimensions and have the outer fingers absorb those adjustments either inward or outward, whichever would have been required. If, however, we had started from the outside in, and any one of the five finger stone placements had been off the slightest bit, we would not have been able to gradually adjust either the keystone opening or the keystone itself to accommodate for the error, since this would have been the last stone installed. During the process of lowering the support shoring, the engineering team expected a deflection in the keystone of from five to 16 millimeters – with five representing close to perfection in fabrication and construction. The overall

deflection when the shoring was lowered was six millimeters. It was a result of which everyone involved in the memorial could be very proud; in the words of Professor John Ochsendorf, it was “damn near perfect!” There were so many people involved in the successful completion of the memorial, and there is just not enough space to mention them all. I would, however, like to personally thank my team who, together with Joe Goncalves, created a piece of art unlike any other; the surveying team at Feldman Engineering Company; and Rob Rogers (Sean Collier’s brother), project manager for Suffolk Construction and Bob Bulcao, his right-hand man, for being there every day through the toughest of conditions, both snow and cold. This incredibly intense project was accomplished during the most severe record-breaking winter ever recorded in the Boston/Cambridge area. It truly became a labor of love for so many people, and I thank them all for their intense dedication. For myself, it was the most gratifying project I’ve ever been involved with. I hope this builder’s perspective helps in understanding why the memorial is so special, and a fitting tribute to Officer Sean Collier. s Robert Asmar is the president of Phoenix Bay State Construction Co., Inc., in Boston, Mass., recipient of numerous awards both locally and nationally for their historic masonry preservation and conventional masonry projects. He can be reached at (617) 442-4408.

Edward M. Kennedy Institute for the U.S. Senate

Photo: © Bruce T. Martin

Building history into the future.

W W W. M A R K R I C H E Y. C O M

The Professional Contractor

INSURANCE

BY WILLIAM LEMOS

Coverage, Safety, Service What Subcontractors Need to Know

ou know that insurance is essential for your construction business, but did you know that not all construction insurance brokers are the same? If you tend to compare policies based solely on price and coverage, then you are missing vital services that only select brokers can provide – services that will save you time and money. An expert broker in the construction insurance industry knows that contractors need the right coverages and services that include superior risk control, claims processing and underwriting service.

Risk Control Most, if not all, brokers offer some type of risk control advice as part of their agency’s services. However, the quality and depth of their risk control offerings is the key differentiator. Many brokers will provide only general suggestions and generic safety programs. While those can be useful, a more comprehensive, in-depth risk control program is extremely advantageous for a contractor. Rather than relying on general advice, brokers who specialize in the construction industry can give you tailored industry guidance. The most dedicated brokers will send a safety specialist to your worksite in order to observe your operations and create a customized risk control and safety program tailored to your unique business needs. Only after a broker understands your day-today needs and challenges can he or she provide meaningful solutions. A good risk control program should emphasize safety as paramount. Worksite accidents are expensive, both in terms of claims costs and future premium increases – but also in hidden costs. You may not realize just how expensive an accident can be: •• LOSS OF PROFITS: Accidents may interrupt work for a time period or even cause projects to run late. In addition, property damage involved in the accident may be time consuming and costly to repair.

Bill Lemos is senior vice president and construction manager at Eastern Insurance with over 15 years in the insurance industry. He can be reached at 508-620-3413 or wlemos@easterninsurance.com.

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•• SOFT COSTS: Accidents may also require manpower to be redirected away from completing construction work to manage other responsibilities, such as additional paperwork, meeting with law enforcement or following up on investigations. •• MARKET IMAGE: No one wants to hire a contractor prone to accidents, and one or two high-profile accidents could give your firm a bad reputation. Your safety track record is an important component to winning future bids. •• PSYCHOLOGICAL IMPACT: Other employees often have strong reactions following a serious or fatal accident. They may blame the company for not protecting their coworker or may simply need time to deal with the trauma they witnessed or were a part of. This could impact your retention and ability to hire quality workers in the future. These examples show just how important an effective safety program is, and a good broker will help you develop comprehensive safety initiatives to address any and all risks your company faces. Remember, too, that certain safety initiatives are mandated by law. Plus, many construction insurance policies will only pay claims if you can demonstrate that your company follows strict health and safety guidelines.

Claims Processing The aftermath of an accident can be a stressful and overwhelming time, and you need a broker who is quick, efficient and knowledgeable with handling claims and helping you manage the accident site. You may want to consider a broker whose agency has a local office, to ensure they are familiar with your geographic area and local nuances that can affect claims processing and settlement. In addition, your broker should have extensive experience with construction industry claims, so that your claim is properly handled. A local broker can also prove more responsive after an accident. You may have to deal with the media or law enforcement officials, and your insurance representative can help manage that situation. Some agencies will insist on waiting for a claim to be processed before visiting the site, but dedicated brokers will

be there immediately to help with preserving evidence, serving as a liaison and managing the accident site.

Breadth of Coverage There are many types of coverage that a contractor needs, and only agents that specialize in the construction industry will be able to ensure that you are fully covered. If your broker takes the time to learn and understand your business operations and the unique risks of your company, he or she will be able to put together a comprehensive coverage package. Beyond the standard general liability, commercial auto, workers’ compensation and excess liability and property coverages, you may benefit from marine, professional liability, surety coverage and more. Your broker should know how to coordinate your various policies to ensure that there are no gaps in coverage. When a claim occurs, a good broker will help liaise with the carriers to sort out who will handle the claim. Some policies may have exclusions that your broker should be aware of and

can address with an alternative solution, such as a general liability policy that has a pollution exclusion. If you work in multiple states, that also may have implications for your coverages. Your broker must understand and manage all of these aspects to ensure that you are appropriately covered.

Underwriting Service Underwriting can hold up the quoting process when putting together a coverage package. However, brokers who have relationships with carriers and underwriters they trust can work to ensure the quickest turnaround time for a quote. Though this behind-the-scenes exchange normally does not impact you directly, agents who work with reliable, responsive underwriters can save you time when quoting a renewal or new policy. Obtaining insurance should be a strategic component of your business. Developing a comprehensive insurance program to support your unique business needs is not something just any broker can deliver. s

Top of the Class Franklin High School Franklin, MA Photo Credit: Andy Caulfield

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The Professional Contractor

GOLF TOURNAMENT

20th Anniversary Golf Tournament Is One to Remember Golf Chair Steve Kenney (third from left) poses with scholarship award winners Anthony Canavan, Nicole DeFeudis, Emily DiGiusto, Erika Furtado and Nicholas Sacco.

hile every ASM Golf Tournament is enjoyable in its own right, it was a poorly kept secret that the 20th anniversary of this event was going to be special! ASM Vice President Steve Kenney of NB Kenney, who has chaired the event every year since it first started, was determined to play it up big. And so it was a record-breaker in every respect – more players, more sponsors, more gifts and prizes, and best of all – more scholarship winners as well! It was sold out over a month in advance, and nearly 300 players turned out at The International on July 13 to enjoy the event, a little friendly competition and a welcome respite from busy schedules. As a fundraiser for ASM, it was our most successful event ever – thanks to the very generous support of nearly 120 sponsors (see page 23). Special thanks go to Acadia Insurance and TGA Cross, sponsors of the “cool” beach cooler gift, and Charles D. Sheehy, who sponsored golf gloves for all players. Many thanks also to Alliant Insurance, who helped launch our new Young Professionals Leadership Fund, which will provide stipends to our “next gen” members to aid their professional development; and to Airgas USA LLC Northeast Region, for stepping up as our Premium Industry Partner for this event. In his dinner remarks at the end of the day, Steve Kenney looked back 20 years and recalled all that has happened in that span of time, good and bad, not just in the industry but the world around us – including the attacks of Sept. 11, the “worst recession of our lives,” and the Boston Marathon bombings. But above all, he spoke of the reasons to celebrate, including the robust state of the construction industry today, and ASM’s important victory in 2014 for subcontractors with the passage of the 5 percent retainage law. Capping the day was the presentation of our 2015 scholarship awards to deserving students 22

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from ASM member families. Thanks to the success of tournament, we were able to award $10,000 in scholarships this year, putting a bow on a memorable year for the subcontracting industry, and for ASM.

Five Students Receive ASM Scholarship Awards

As always, the highlight of the annual golf tournament is the opportunity to recognize and reward students from ASM member families who have excelled in academic, extra-curricular and community activities throughout their high school years. This year, thanks to the generous support of our sponsors, ASM was able to present $2,000 scholarships to five exceptional students whose parents work at ASM member companies. Interest in ASM’s scholarship program has grown each year, and this year brought a record number of highly qualified applicants. Although competition was stiff, this year’s winners stood out not only for their academic achievements but their wide-ranging athletic and artistic accomplishments, as well as their charitable endeavors and commitment to serving others. This year’s winners, and the companies behind them, were Anthony Canavan (Cox Engineering, Canton), who will be attending Holy Cross; Nicole DeFeudis (Coghlin Electrical, Worcester), who will start at Boston University this fall; Emily DiGiusto (McGladrey, Boston), who will enter the Commonwealth Honors College at UMass Amherst; Erika Furtado (T.G. Gallagher, Cambridge) who will head to Florida’s Southeastern University; and Nicholas Sacco (Limbach Company, Woburn) who will study electrical engineering at UMass Lowell this fall. We congratulate our 2015 Scholarship Award winners and wish them success in their academic journey, as they pursue their career goals! s

THANK YOU, MAJOR GOLF SPONSORS! Beverage Cart Lockheed Window Corporation Siemens Industry, Inc.

Closest To The Line The Greater Boston Plumbing Contractors Association Salem Glass Company

Player Gift: Coolers Acadia Insurance TGA Cross Insurance Player Gift: Golf Gloves Charles D. Sheehy, Inc.

Closest To The Pin Herlihy Insurance Group LAN-TEL Communications, Inc. Milwaukee Valve Stafford Construction Services, Inc.

Practice Tee API of NH Newman Associates

Course Banners Front Line, Inc. William M. Collins Company, Inc.

Putting Green Novia Associates

Premium Industry Partner Airgas USA LLC Northeast Region

Field Goal Corwin & Corwin LLP N.B. Kenney Company, Inc.

Raffle Buckley Associates Capone Iron Corporation E. Amanti and Sons, Inc. Fernandes Masonry, Inc. LAN-TEL Communications, Inc. Manganaro Northeast LLC Victaulic Company Worcester Air Conditioning LLC

Golf Balls Eastern Insurance Group LLC, Construction Division

Reception Energy Insulation R.H. Keleher Company

Golf Cart F.W. Webb Company Viking Controls, Inc.

Grand Raffle Chapman Waterproofing Company New England Mechanical Contractors Association

Scholarship Awards ENE Systems, Inc. Frank I. Rounds Company Milwaukee Electric Tool Corporation Royal Steam Heater Company Stebbins-Duffy, Inc. Wayne J. Griffin Electric, Inc. William F. Lynch Company, Inc.

Long Drive Limbach Company National Electrical Contractors Association â&#x20AC;&#x201C; Greater Boston Chapter

Score Cards Thermo-Dynamics International, Inc. Rucci, Bardaro & Falzone, PC

Lunch Acadia Insurance J.C. Cannistraro, LLC

Young Professionals Leadership Development Fund Alliant Insurance

Dinner Independent Pipe & Supply Marsh & McLennan Agency (formerly known as Protector Group)

Golf Getaway Raffle McCusker-Gill, Inc.

Pin Flags Greenwood Industries McGladrey

The Professional Contractor

NEW IN DUCTWORK

BY SCOTT SZYCHER

Building Owners Go Behind the Walls to Save Space and Reduce Expenses such as ductwork now allow owners to dedicate more square footage to leasable space, while still ensuring robust fire protection for tenants. “Building owners are required to limit the spread of smoke and fire through the use of dampers within vent duct systems,” said Jason Rodriques, sales manager for Canton-based Buckley Associates, one of the region’s premier distributors of mechanically engineered products for building owners, facility managers and construction professionals in the HVAC industry. “But that takes up space that otherwise could be leased.”

Proven Product

ny construction professional will attest to the fact that modern project schedules are very aggressive, as building owners want their properties ready for occupancy as soon as possible in order to generate revenue. But just getting tenants into commercial buildings quickly isn’t the end of the story; owners also need to maximize the amount of leasable space in these buildings. Fortunately, advances in construction equipment Scott Szycher is the membership and marketing director for ASM.

Summer 2015

Buckley Associates now markets and sells a line of fire-rated ductwork from Conquest Firespray that offers the same fire protection while using less space. “Traditionally, fire wraps were needed to prevent the spread of fire through ductwork, which is bulky, and costly to install in confined spaces,” noted Rodriques. “Conquest’s new flamebar systems are fire-rated for both inside and outside the ducts, and generate savings during build-out and occupancy.” That’s because the flamebars eliminate the need for fire wrap materials, damper framing, wall penetrations and fire proofing, as well reduce labor and installation costs. Conquest has also designed fire rated ductwork solutions with flexibility in mind, offering rectangular, spiral, oval and flat oval shapes. This flexibility, along with its ability to be installed just three inches away from architectural walls, provides numerous cost and schedule advantages. “It’s great for fast track projects, and owners love it because they can reclaim valuable floor and ceiling space to lease out,” Rodriques said. The ductworks systems have been put to the test in some very high-profile projects, including the ongoing construction of the new stadium for Major League Baseball’s Florida Marlins, where 100,000 plus square feet of firespray ductwork provided several advantages. The smoke exhaust and stair pressurization ductwork specifications called for steel ductwork with two layers of ceramic fire wrap insulation, rated for two-hour fire protection. But through the flamebar fire-rated ductwork system

and associated coating, the need for fire wrap was eliminated, space was saved, fast-track installation proceeded and material and labor costs were reduced. Conquest’s ductwork also appeals to building owners operating under unusual space constraints, such as research facilities requiring large laboratory footprints. One such example was the University of California – Berkeley’s Helios Energy Research Facility. Conquest’s advanced ductwork systems eliminated the need for a drywall shaft, reduced the lab exhaust assembly’s footprint by more than a foot both vertically and horizontally, and streamlined the construction schedule without impacting the budget. “It’s rare to get the best of all worlds – speed, high quality and cost effectiveness – but Conquest’s ductwork systems do all that,” said Rodriques. “That’s why when we work with owners, architects and subcontractors on ductwork solutions, we often recommend this system.”

New Technology The benefits of advanced ductwork technology extend to restaurants, too, which is certainly welcome news to restaurant owners who need to manage facility costs as well as their usual food and labor expenses. AirMaid, another product distributed and represented by Buckley Associates, is utilizing ozone to help restaurant owners save money. Eateries have long faced challenges with grease buildup and related odors in their ventilation ducts, resulting in costly and

labor-intensive duct cleaning expenditures. But ozone, a gas which quickly decomposes into oxygen and oxygen-free radicals, interacts with grease and breaks it down into a combination of water and minerals that’s less likely to build up, and far easier to clean than grease. The AirMaid product eliminates all types of bacteria that may collect in the extract/exhaust ducts, preventing that bacteria from finding its way back to the kitchen. “Once the AirMaid is installed, your ducts are practically maintenance-free, so restaurant owners and managers can save big on their duct cleaning expenses,” said Rodriques. “You’re also reducing the safety risk, and you’re practically eliminating the flammable grease that collects in the exhaust ducts. Particularly for buildings with ground-floor restaurants, it’s a huge benefit to all the tenants.” In Europe, some restaurants using Airmaid have seen their insurance premiums decrease because of this reduced fire risk. From his vantage point at Buckley Associates, Rodriques has a front row seat to products that are employing new or different technologies that reduce costs and other headaches for owners. “The market is now demanding technological advances in engineered systems that reduce energy expenses, save space, or provide some clear financial benefit to developers or tenants,” he observed. “And the manufacturers that we represent are rising to the challenge. Finding ways to add value through innovation and engineering is no longer a luxury, it’s a necessity.” s

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continued on page 25 50 50 Oakland Oakland Street Street Watertown, Watertown, MA MA The Professional Contractor

BY SCOTT SZYCHER

PHOTOS BY NEW ENGLAND LAB FURNITURE

TECHNOLOGY

Biotech’s Growth Means Busy Times for Lab Furniture Contractors

hen looking at some of the region’s hottest industries, biotech would certainly be at or near the top of the list. Between the 100 plus life sciences companies in Cambridge’s Kendall Square, and the companies and research facilities along Routes 128 and 495, Massachusetts is bursting at the seams with real estate, development, construction and retrofitting activity within this sector. While all professionals need workstations that enable their work, the workstations of lab technicians and researchers bear little resemblance to the types that one would find in most professional environments. Biotech companies and research facilities contain laboratories dealing with highly communicable diseases, germs, bacteria and pathogens. These same labs also utilize chemicals which would severely damage typical office furniture, in addition to generating dangerous fumes. That’s opened an opportunity for contractors who specialize in providing lab furniture solutions specifically for the needs of life science companies and research facilities which need to conduct detailed medical research. Woburn-based New England Lab is one such contractor, and has developed a reputation for providing high-quality furniture, casework and work spaces designed specifically for the unique needs of labs. New England Lab also offers a variety of ventilation devices known as fume hoods, which prevent exposure to hazardous or toxic fumes and vapors, and biosafety cabinets that prevent exposure to biological hazards such as viruses, bacteria and mold. “It’s important to know the processes that are taking place within the lab,” said Rand Weyler, client technical services manager for New England Scott Szycher is the membership and marketing director for ASM.

Summer 2015

Lab. “The cabinets we provide to our clients can be painted steel, wood, stainless steel, or any number of materials. Clinical environments often require a nonporous material such as painted steel, or even stainless steel if the furniture needs to be disinfected regularly.”

Knowing the Needs of Your Client Given the variance in size and budget between giants like Vertex and Biogen, versus smaller research facilities, Weyler stressed that it’s critical to understand a client’s needs and challenges when making recommendations. “We work extensively with the client and the architect, and draw from 25 years of lab experience to come up with cost-effective solutions. We need to know not only what their needs are right now, but also how they may use the lab two to five years from now, as they grow or change.” Middleton-based Lab Furniture Installation and Sales is another local firm serving the biotech sector that has the design expertise needed to add value to a project team, and the manufacturing connections to get casework on site quickly. “One of our biggest attributes is timing, since getting the right kind of casework to a project site as quickly as possible is critical in this environment,” said Tom Thrun, business development manager for the company. “It used to take three months to get casework to a project site, but now, apart from delays on the manufacturer’s end due to high demand, the timeline has been reduced to 30 to 60 days.” Thrun is a strong proponent of an owner or architect on a lab project getting the furniture subcontractor involved as early as possible, particularly since lab tenants are demanding more mobility in their lab equipment. “If we’re brought into the design process early, we can identify where electri-

cal outlets will be needed, and where the ductwork needs to go to connect to the fume hoods,” Thrun mentioned. “And it will lead to better client satisfaction, since we can work with the architect or general contractor to map out flexible solutions or tenant customization.”

of change they’ve seen in the last few years, whether it’s the need for flexibility, help with the design process, or aggressive project timelines. “The last five years, we’ve seen a major shift to free-standing table-based systems that can be moved around a lab and allow our clients plug and play flexibility,” said Weyler. “Our Money-Saving Measures clients are looking for faster ways to Lab furniture contractors also save reconfigure their spaces, and hope to money for some clients by pre-wiring and eliminate renovation costs. It’s important pre-plumbing lab benches at the factory. to know the client’s goals, and one of our “Otherwise, the client would have to pay strengths is providing proven solutions someone to do it onsite, who may not be for a variety of needs and budgets.” familiar with the specialized furniture Thrun added, “We were recently apthe services are going into,” noted Wyler. proached by a large pharmaceutical “At the factory, services can be installed client to assist in the design of a small lab prior to the furniture’s assembly, for faster space, which needs to start operations access.” New England Lab’s project for in two to three months. It’s indicative of Ipsen Bioscience in Cambridge featured how rapidly this sector is evolving, and free-standing bench systems that were prehow the days of cookie-cutter lab spaces plumbed and pre-wired with electrical and are gone.” data outlets that facilitated quick connecWeyler echoed Thrun’s sentiment tions to the facility’s ceiling service panels, about rapid turnaround time. “For some which reduced costs and saved time over clients, even four weeks isn’t fast enough! traditional service installation. We now stock our most popular lab As for the next 10 to 15 years, both furniture items so they can be purchased SullGroupTPC 1/29/09 3:49 PM Page 1 Weyler and Thrun expect the same pace online, and delivered in days.” s

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MEMBER NEWS

Capital Carpet Walks the Walk to Benefit Lymphoma Research

Capital Carpet & Flooring Specialists, Inc. (Woburn) was a 2015 Silver Sponsor of the Massachusetts Lymphoma Walk in May at Wakefield’s scenic Lake Quannapowitt. This annual 5K walk has raised $530,000 since 2009 (with almost $90,000 from this year’s walk!) in support of the Lymphoma Research Foundation’s mission to eradicate lymphoma and support those affected by the disease.

Cantarella Masonry Assists Umass-Amherst’s $93 Million Learning Center

Cantarella Masonry (Pittsfield) was part of the project team for UMass Amherst’s new Integrative Learning Center, contributing concrete masonry unit work in the basement classrooms and interior elevators. Despite the challenges of working with lipped limestone on relieving angles that started at 20 feet in the air, the students are now enjoying a state-of-the-art facility to learn in! 28

Summer 2015

Marr Companies Lends A Hand to BU’s Agganis Arena

Marr Companies (Boston) helped the Boston University men’s hockey team reach the championship game by removing the snow drifts from the roof of the Agganis Ice Hockey Arena that generated concerns about the roof’s structural integrity.

American Plumbing & Heating Hosts Pre-Apprentice Graduates Mcdonald Electric Completes Fit-Out of New Converse World Headquarters

McDonald Electric (Hingham) has recently completed comprehensive electrical installations for 10 floors of office space and two mechanical floors, at Converse Inc.’s new world headquarters at Lovejoy Wharf in Boston. The work was impressively accomplished in under six months to meet an aggressive occupancy schedule.

Knollmeyer Building Corp. Continues Exterior Restoration of Iconic Marriott Hotel Custom House Tower

Knollmeyer Building Corporation (Wilmington) has begun the exterior masonry façade repair on Boston’s historic Custom House Tower (now owned by Marriott Corp.). Because of its historic designation, Knollmeyer’s work on the building – which previously included granite repairs, sheet metal flashings on exposed ledges and liquid waterproofing of horizontal surfaces – required months of complex logistical planning, including collaboration with the Massachusetts Department of Wildlife to protect the peregrine falcon fledglings nesting in the building’s uppermost window.

American Plumbing & Heating (Norwell) owner Joe Clancy and shop foreman Bill Ferguson demonstrated soldering, pipe cutting and quality control practices to the graduating class from Building Pathways – a six-week program that prepares qualified applicants for apprenticeships in the building trades.

Three Generations of People Protecting People The Herlihy

Construction Division We speak your language. Our Construction Division has specialized in your industry for over 85 years. Contact us today and see the difference an expert can make in your business. Property/Liability | Fleet Automobile | Workers Compensation | Surety Bonding Contractors Equipment | Group Health | Subcontractors Design E&O Pollution Liability | Railroad Protective

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The Professional Contractor

MEMBER NEWS E.M. Duggan Voted One of the Best Places to Work

Triple G Scaffold Promotes Scaffold Safety at No Charge

Triple G Scaffold (Norwell) has been providing its User Hazard Awareness Program, consisting of classroom and hands-on training, to contractors at no charge, in the name of workplace safety. Contact Mark Bouvier at 781-681-9090 for more information.

E.M. Duggan, Inc. (Canton), one of the area’s largest mechanical contractors, was recently voted by the Boston Business Journal as one of the best midsize companies to work for. The honor recognizes the company’s achievements in creating a positive work environment that attracts and retains employees through employee satisfaction, working conditions and company culture.

The Compliance Mentor Group Spearheads Construction Apprenticeship Program

The Compliance Mentor Group (Boston), a full-service diversity compliance firm serving the construction industry, is working in conjunction with a variety of partners, including the New England Regional Council of Carpenters, Lee Kennedy Company, Inc. and Madison Park Technical Vocational High School to offer a cooperative apprenticeship program for qualified high school seniors. Through this collaborative effort, motivated seniors can build a possible career path, while also addressing the construction industry’s need for an infusion of young talent.

Wayne J. Griffin Electric Completes Work for UConn’s Ambulatory Care Center Wayne J. Griffin Electric, Inc. (Holliston) performed power and lighting installation, as well as systems for fire alarm, video surveillance and access controls for the new 300,000 square-foot Ambulatory Care Center at the University of Connecticut in Farmington, a facility with an expected LEED Silver designation.

Summer 2015

Abbot Building Restoration Completes Work For Peabody Essex Museum

Abbot Building Restoration (Boston) has finished the restoration of the exterior facades of the historic Philips Library and Plummer Hall at the Peabody Essex Museum in Salem. The centerpiece of their work was the complete disassembly and replacement of the library entrance portico; other facets of Abbot’s work included repointing all the brick masonry; removal and replacement of the ornamental brownstone; historic restoration of the wood windows, and more.

Build New England

AWARDS 2015 AGC Build New England Awards Program | October 8, 2015 | InterContinental Hotel, Boston

Join the Associated General Contractors (AGC) and other professionals from all facets of the built environment to celebrate the Build New England Award winners for 2015. This program recognizes the concept of teamwork in building tomorrowâ&#x20AC;&#x2122;s facilities, including commercial, industrial, retail and education. The project teams are recognized for their collaborative approach to planning, designing and building facilities that meet the vision and goals of the owner and enhance the community in which the project resides. The Build New England awards ceremony will take place on October 8, 2015 at the InterContinental Boston. Get involved by sponsoring this prestigious event. Youâ&#x20AC;&#x2122;ll receive exposure to the biggest and best players in commercial real estate and construction, including builders, owners, architects, subcontractors, suppliers and more. Associate your company with the top projects in the state and meet all of the key players the night of the event. Youâ&#x20AC;&#x2122;ll also receive recognition in the magazine that goes to all of AGC and readers of Banker & Tradesman.

To learn more about The Build New England Awards or to customize a marketing program unique to your business needs call 617-896-5307 or email advertising@thewarrengroup.com.