While state leaders fiddle behind closed doors over a state budget already more than two months late, area contractors have been burned to the tune of at least $107 million in stalled public works projects in the Hudson Valley region.
The spring budget impasse in Albany has deprived the construction industry, already hammered by the recession and high unemployment, of an estimated 3,400 jobs on 13 road and bridge projects for which winning bids have not been awarded in the seven-county region, according to the Construction Industry Council of Westchester & Hudson Valley Inc.
Since April 1, when the state”™s 2010 fiscal year began, nearly $1 billion in construction contracts statewide have not been awarded on more than 100 projects approved by the state Department of Transportation (DOT), according to the Associated General Contractors of New York State. Those stalled projects, for which funding already is in place, would create an estimated 34,700 jobs, based on Federal Highway Administration projections.
“That”™s huge,” said Ross J. Pepe, president of the Construction Industry Council in Tarrytown. He noted contracting crews have been idled at the height of the construction season. Unemployment rates already are at historic highs in the construction trades in New York, reaching 40 percent in some building trades in this area, he said.
A two-month-long freeze on state payments to contractors already at work on infrastructure projects when the April 1 budget deadline passed showed signs of a late-May thaw when Gov. David Paterson submitted his eighth weekly budget extender to the state Legislature. The spending extension, approved by legislators, included a provision that allows the state to use funds from the state Thruway Authority bond program to pay its share of road and bridge work on projects that are largely federally funded.
Paterson previously suspended state payments to contractors for work done after April 1 except for projects funded entirely by federal stimulus dollars. The governor”™s unprecedented step prompted a legal challenge last month by the Construction Industry Council and other trade organizations.
The case is pending in state Supreme Court in Albany. Attorney Alfred B. DelBello, of DelBello Donnellan Weingarten Wise & Wiederkehr L.L.P. in White Plains, who represented the construction industry in court, said the legal action, which asks that contractors either be paid as due or be given stop-work orders by the state, might have pressured state officials to release funds to contractors. Pepe said the state reportedly freed up $15 million in payments for road and bridge work from April 1 through April 25.
DOT officials recently acknowledged contractors”™ dilemma in an advisory from Ronald Epstein, the agency”™s chief financial officer. Epstein said unpaid contractors who shut down their projects will not be declared in breach of their contracts with the state. Time schedules and delays and extensions will be fairly resolved on an individual project basis once a state budget is adopted, he said.?The state”™s release of some project funding did not persuade one construction company to pick up where it suddenly left off in late March on a bridge rebuilding project in Westchester.
New Jersey-based Conti Construction Co. claimed it is owed $942,000 from the state for work done before April 1 on its $19-million project to replace a badly deteriorated 80-year-bridge on Route 120 at Chappaqua. By June 2, the company still was not back at work, despite efforts to have the project completed by town of New Castle officials and Assemblyman Robert Castelli, R-Goldens Bridge. Conti officials did not return a call for comment.
In a May 26 letter to Paterson, New Castle town Supervisor Barbara S. Gerrard said the partly closed bridge poses both “a looming safety hazard” and an economic hardship for both Chappaqua businesses and residents affected by long traffic tie-ups and damage to vehicles from the bridge”™s “dreadful condition.”
Construction industry leaders, meanwhile, are pushing for action on the stalled public works bid awards. “We’ve got to get these projects moving or we’ll lose the entire construction season,” Steven Stallmer, vice president of government and public affairs for the Associated General Contractors of New York State, said in a prepared statement. “Contractors have already lost the months of April and May, causing our state infrastructure to continue to deteriorate. As each day passes without awarding these contracts, we are wasting the opportunity to put thousands of people back to work.”
