The Construction Contract Review

Green Construction Technology: Concrete Bricks

Pozzotive Plus CMUs and Concrete Brick from Kingston Block

Pozzotive Plus concrete masonry units (CMUs) and concrete facing brick are manufactured using up to 30% post-consumer recycled glass as a portland cement substitute and an average of 50% post-consumer recycled masonry aggregate from local sources in the Northeast. The recycled glass pozzolan (with the tradename Pozzotive), made by Empire Resource Recycling, LLC, is ground to about 15 microns (a finer powder than portland cement) and used in place of the cement, saving about one ton of CO₂ for every ton of cement replaced.

Pozzotive Plus CMUs have been made with up to 90% recycled aggregate, though 50% is typical. Compared to conventional CMUs and brick, Pozzotive Plus products require less energy to produce, are stronger, and have greater moisture and chemical resistance, according to the company. Both products meet and exceed ASTM C-90 for Loadbearing Concrete Masonry Units and C-129 for Nonloadbearing Concrete Masonry Units, and the brick meets and exceeds ASTM C-1634 for concrete facing brick. The company’s brick is manufactured with a standard bed depth of 3-5/8" and is available in three sizes: Modular (2-1/4" x 7-5/8"); Ledge (2-1/4" x 15-5/8"); and Royal (3-3/4" x 15-5/8"). In addition a Partition brick is available for interior applications (5-5/8" x 3-3/4" x 15-5/8"). Architectural CMUs are available in a wide range of shapes and sizes. Both the brick and CMU come in nine standard colors, in either ground-face or suede finish.

What makes this product green?

• Exceptional durability or low maintenance
• Post-consumer recycled content
• Reduce impacts from construction or demolition

LEED Credit relevance:

• MR Credit 4 — Recycled content

Reviewed in EBN: November 2009
View GreenSpec listing

More information:

Kingston Block & Masonry Supply, LLC
270 North Ave., Suite 200
New Rochelle, NY 10801
Phone: 914-633-3393
www.kingstonblock.com

via www.buildinggreen.com

Are there “green” provisions or specification in a proposed contract you are bidding on?  Have you identified the risks of those clauses and are you prepared to handle those new contractual risks?  Click here to send us your contract and we will provide a complimentary attorney review.

Green Updates: Construction Contract Review For November 2009

A few updates or interesting items I encountered this month:

Green Mall Expansion

In November, I wrote about a troubled mall expansion in Syracuse intended to showcase green construction technologies.  The Wall Street Journal reported that the New York State Supreme Court Appellate Division, affirming a lower court decision, ruled that Citigroup must continue to fund a $155 million construction loan to Destiny USA Holdings.  The developer must post a $15 million bond before the bank must fund the remainder of the project.  Look out for changes in determination of default criteria in construction loan agreements. 

Clean Diesel

The Associated General Contractors of America and the Clean Air Task Force lobbied Congress to let states mandate the use of clean-diesel equipment for federally funded highway construction.  The New York Times reported that the two groups want new legislation to authorize states to require diesel emissions reductions at construction sites and to cover the cost of retrofitting or repowering equipment manufactured to meet earlier emissions standards.  Under the plan, states would first require contractors who successfully bid for a project to identify the off-road diesel equipment they plan to use during the construction process. States would then consider a U.S. EPA-approved measure for cutting emissions from the equipment and issue orders to the contractors requiring that they pursue the best of the emissions-reducing options.  Federal funds would be used to reimburse the contractors, according to the Times.  Anti-idling and alternative fuel policies are easy to implement and cost effective.  Are you ready now for these guidelines?  Why not?

Emission Footprint Tool

The Rocky Mountain Institute has developed an assessment tool for reducing carbon emissions from building construction projects called Green Footstep.  According to the website, the Green Footstep tool can be used on residential and commercial new and retrofit building construction projects, from pre-design through occupancy. The tool assesses design's total carbon footprint due to site development, construction, and operation; helps designers and other project stakeholders set carbon emissions goals and design targets; identifies ways to meet the Architecture 2030 Challenge, earn credits in green building rating systems, and achieve other goals; and compliments a financial model (based on life cycle cost analysis) to provide the most comprehensive support for building design decisions.  The tool is online and FREE.

Review of the Green Building Addendum from ConsensusDOCS

ConsensusDOCS is an organization that has developed construction contracts endorsed by 23 leading industry associations representing owners, contractors, subcontractors, designers and sureties. ConsensusDOCS states that its contracts protect the best interests of the project rather than a singular party, yielding better project results and fewer disputes.  ConsensusDOCS seeks a broad range of industry viewpoints when drafting its standard contracts, “ensuring an equitable balance of risks and responsibilities and an appropriate baseline for the parties’ legal relationship.”  It publishes a comprehensive catalog of standard contract documents that now includes a Green Building Addendum.   

 

The Green Building Addendum attempts to provide “a contractual mechanism to identify clear objectives, and assign roles and responsibilities to achieve green goals” for use on “projects with green building elements, particularly those seeking a third-party green building rating certification such as LEED.”

Sections of The Green Building Addendum

1. General Principles – lays out broad goals for the Addendum
2. Definitions – defines specific terms that are used elsewhere in the Addendum as capitalized terms
3. Green Requirements and Procedures – identifies the specific regime to be used on the project
4. Green Building Facilitator – introduces and defines a point person/entity for green issues and coordination
5. Green Status – process for selecting a specific green certification regime
6. Green Measures – process for identifying responsibilities for implementation of green certification
7. Plans and Specifications – how the green steps are to be incorporated into the plans and specifications
8. Risk Allocation – confirms the allocation of risk laid out in the underlying contractual documents between parties

Pros of Green Building Addendum

• Regime Agnostic

  The Green Building Addendum does not incorporate any particular “Green Status” from any specific organizations, such as the USGBC’s LEED standard or Green Globes from the Green Building Initiative.  This gives the Addendum staying power for new standards where none currently exist, flexibility for future revisions, and is not beholden to one set of certification regime or processes. 

• Seamless Integration 

   As would be expected, the Green Building Addendum is designed to integrate seamlessly with existing ConsensusDOCS contract documents and procedures.  If one is familiar with ConsesnusDOCS, one will be comfortable with this Green Building Addendum. 

• Clarity

  The Green Building Addendum provides clear processes and who is responsible for identifying green certifications, communicating steps towards green goal achievements and how/if any green issues affect the underlying relationship between the parties in the construction project. 

Cons of Green Building Addendum

Many of the weaknesses below are inherent in attempting to be an industry standard form in an industry that is by definition constantly being redesigned. 

• Vaguenes

  As a noted strength, the Green Building Addendum is “regime agnostic,” therefore the processes defined are generic.  Something along the lines of “A goes to B who has 30 days to respond to [generic process]” as opposed to “A submits [LEED process] to B”

• Length

  It is a contract so the definitions are very lengthy and could be confusing to non-attorney users.  The Addendum itself is 10, single spaced pages.  There is room for condensing sections and tightening of the language, in my opinion.  This, in and of itself, may limit its use to larger projects that warrant large documentation packages. 

• Requires More

  The Green Building Addendum is not a stand alone document, nor is it intended to be.  Underlying contracts are required between all the various parties, including the new Green Building Facilitator, if an additional party. 

As with any industry form or other construction contract, parties are encouraged to consult competent legal, insurance and surety advisors before using, modifying or completing the Green Building Addendum.  Everything needs a first step.  The availability of the Green Building Addendum will help speed up the incorporation of green and sustainable construction practices in the industry.

Green Construction Not Enough

 

Construction of a three-story, 1.3-million-square-foot mall expansion, the largest building project in Syracuse in 19 years, came to a halt in June after Citigroup refused to loan any more money to the developer.  The project was designed to showcase "state-of-the-art" green technology, renewable energy resources, and sustainable design for both construction and operations. The project was to include an innovative design combining research, retail, entertainment, dining, hospitality and tourism. The project has created expectations to create tens of thousands of jobs, attract millions of visitors to an otherwise economically depressed region, and add millions of dollars annually into the local and state government economy.  Drawing in part on public funding, it had become known as the model "private - public partnership" for economic development, for green development and for sustainable development. 

 

The Post-Standard reported that Citigroup said the project was at least $15 million over budget and a year over schedule -- and had no tenants signed up despite the expenditure of millions of dollars on marketing. It demanded that the developer put up $15 million more of his own money, on top of $40 million he already has put into the construction.

 

The project was being financed by the developer’s own $40 million, $170 million from the sale of Syracuse Industrial Development Agency bonds and a $155 million loan from Citigroup. The $210 million in SIDA bond proceeds and the developer's own money have already been dispersed and are not at issue in the dispute.

 

When the bank stopped funding the construction, the developer sued the bank, saying Citigroup reneged on the loan agreement because of its own financial problems - problems that prompted the federal government to give the bank $45 billion to keep it afloat.  The bank countered that as a result of a loan "Deficiency", the bank had no further obligation to fund the construction loan agreement until the "Deficiency" was fully resolved and the developer was in default on interest payments.  Citigroup also attempted to argue that because there were allegedly no signed leases and because - in their opinion - the project was a "failure", that there should be no obligation to further fund the project.  According to the Court, the bank sought to rewrite the loan agreement because there was no requirement that there be any tenants whatsoever at this stage of the construction. There was no requirement that - at this stage - the project be a success or otherwise. The first net operating income test from the loan agreement did not come effect until some six months in the future. The court concluded that the bank’s arguments were “specious, without substance in law and fact, and irrelevant to the issues before this Court.”

 

The practice of the loan funding was to pay interest payments from the funding.  If the funding did not come in, the developer was unable to make the interest payment.  By stopping the funding, the bank created the deficiency itself. 

 

The Court ruled that the bank broke the loan agreement and ordered it to resume lending the remaining $68.4 million yet to be advanced on the loan, starting with an immediate payment of $29 million. Citigroup obtained a stay of the ruling while it appeals the order.

 

One can have a nice green construction project, but that doesn’t isolate the project from larger economic forces, bad management or stingy bankers.  I probably didn’t need to tell you that though, did I?

Are there “green” provisions in a proposed contract you are bidding on?  Have you identified the risks of those clauses and are you prepared to handle those new contractual risks?  Click here to send us your contract and we will provide a complimentary attorney review.

Green Construction Technology: White Roofs

The Secretary for the Department of Energy, Steven Chu backed an idea to whitewash roofs and highways.  It is claimed that whitening the world's roofs and roads would have the same effect on global warming as removing all the world's cars for 11 years. 

 

CNN reported that a white roof has three benefits:

• It keeps buildings cooler, reducing the amount of energy required for air conditioning.
• It reduces the so-call "heat island" effect, the heating up of entire urban areas which then causes other buildings in the vicinity to heat up, whether they are in direct contact with the sun or not.
• A white roof or road will actually reflect the sun's rays back into space, keeping the atmosphere cooler.

The science is nicely summarized:

The science behind this is solution is also simple.   When a person paints their roof white they are increasing reflectivity (albedo) of the light coming from the sun. Historically, builders have not considered albedo.  Low albedo (dark) surfaces convert visible sunlight to vibrations of their molecules (heat). This is heat is then re-radiated upward as infrared waves, giving it a second chance at being absorbed as greenhouse gas. By painting your roof white your cause this process to be greatly reduced, which in turn reduces the heat and infrared

energy produced.  This in turns keeps structures and areas cooler causing less energy to be expended in cooling.  [A noted scientist in the field of renewables] believes that, "local/global warming is needlessly accentuated, at any level of greenhouse-gas concentration. Correcting this has immediate effect & climate benefit."

 

The Anaheim Hilton estimated that it saved $300,000 by installing a $150,000 tinted topcoat filled with tiny hollow glass balls that deflect heat, layered over a waterproof undercoat made of recycled rubber.  The LA Times reported that the white coating deflects nearly 85% of the heat that hits it, reducing the surface temperature by as much as 50 degrees, reducing the energy needed to cool the hotel's interior, cutting air-conditioning costs and cutting carbon emissions.

 

The Energy Department said a white roof can knock 10% to 20% off a building's electric bill. To that end, it is encouraging anyone replacing or building a roof to take advantage of $2 billion in tax credits available under the stimulus plan.

 

But a white roof may not be best for all roofs in all locations.  Others have noted that there may be a "winter penalty" when cool roofs are installed in northern climates.  Manufacturers of traditional black roofs have stated that in cooler climates, the major goal of energy savings will be to reduce heating costs and that may best be achieved with a ballasted roof because the ballast retains the sun’s heat energy during colder months.

Are there “green” provisions in a proposed contract you are bidding on?  Have you identified the risks of those clauses and are you prepared to handle those new contractual risks?  Click here to send us your contract and we will provide a complimentary attorney review.

Protect Your Green by Protecting the Green

Two stories hit my desk on the same day that I found interesting for construction companies.  First, California adopted stricter pollution discharge rules that will require more aggressive monitoring of construction projects.  The California State Water Resources Control Board’s new General Permit for Storm Water Discharges from Construction imposes a significantly different permitting framework from the Current General Permit that has been in place for the last 10 years.  As reported by Morrison Foerster back in May, when still in draft form, the “new framework includes mandatory BMPs, two forms of numeric discharge limitations, and onerous monitoring requirements that could be costly for developers in California and raise a significantly higher risk of encountering enforcement actions and citizens’ lawsuits in the future.”

 

Highlighting the risk of enforcement actions is the second story I encountered.  The Florida Department of Environmental Protection fined a construction contractor $1,700,000 for alleged violations of its Stormwater Pollution Prevention Plan.  During construction of the Panama City-Bay County International Airport in Florida, there were heavy rains this spring.  Temporary soil stabilization methods (covering the soil with a synthetic covering or hydroseeding, in this case) should have been employed per the SWPPP, but were not, according to DEP and reported by The News Herald.  The DEP estimated that the contractor saved about $950,000 by not installing the erosion matting – the contractor is disputing the violations.  The contractor claims that drainage problems elsewhere on the site are contributing to the failure of the designed runoff prevention system. 

 

If you are trying to run a sustainable or green construction business, you probably already know that nonpoint source pollution is one of the leading causes of water quality problems and that these pollutants can have harmful effects on drinking water supplies, recreation, fisheries, and wildlife.  It is a good thing to protect the green around our jobsites but also rewarding to protect the green in your wallet by following your stormwater pollution prevention plans.

Construction Contract Review for Week of October 16, 2009

Some of the construction news I have encountered or collected this week that I found interesting. 

 

• Tragic news out of Atlanta this week where a construction worker on a Habitat for Humanity project was killed in a sewer trench collapse.  According to the report, neither wooden planks nor steel plates were used to hold back the earth while digging trenches.  The AGC Bookstore, keyword “Excavation,” has available The Excavation & Trenching Training Manual & CD-ROM to work in combination with "In the Trenches: Excavation Safety for Workers" DVD and "Construction Standards for Excavation."  According to OSHA, excavating is recognized as one of the most hazardous construction operations.  Tragic reminder to review your practices today.

• From Construction Equipment magazine, Fleet Masters Awards recognize and honor those fleets that exhibit exceptional management in emissions compliance, return on capital investment, peak residual values, vendor relations, maintenance management, technology and human resources.  Presented in conjunction with The Association of Equipment Management Professionals, Construction Equipment has recognized the following winners:

2009   Private Fleet: Barriere Construction

Public Fleet: Manatee County Fleet Services Division

2008   Private Fleet: Kokosing Construction Co.
Public Fleet: Virginia Department of Transportation

2007   Private Fleet:  CJ Miller LLC

2006   Private Fleet: Traylor Brothers, Inc.
Public Fleet: City of Jacksonville, FL

2005   Private Fleet: Alyeska Pipeline Serice Company and ASRC
Public Fleets: City of Fort Worth, TX

2004   Private Fleet: Barriere Construction
Public Fleet: Virginia Department of Transportation

Simple Climate Change for Contractors: Fuel Switching

In honor of “Blog Action Day” 2009 and its efforts to address climate change, here are some steps green construction contractors can take to address climate change themselves. 

 

A significant proportion of the carbon footprint of earth moving contractors and other heavy equipment users comes from diesel fuel and associated emissions.  Switching to alternative fuels like ultra low sulfur diesel or biodiesel is an easy and effective way to address climate change.  Ultra Low Sulfur Diesel (“ULSD”) fuel is usually required to maximize the clean technology of modern diesel engines and vehicles.  Biodiesel is a clean burning alternative fuel, produced from domestic, renewable resources, which contains no petroleum, but can be blended at any level with petroleum diesel to create a biodiesel blend. It can be used in diesel engines with little or no modifications resulting in a fuel that is simple to use, biodegradable, nontoxic, and essentially free of sulfur and aromatics. 

 

Reduce emissions from construction equipment by substituting clean-burning fuels such as ultra-low sulfur diesel fuel and/or biodiesel or fuel additives verified by the U.S. Environmental Protection Agency (EPA) Voluntary Diesel Retrofit Program Verification Process, when possible and available. Use highway grade diesel fuel in all pieces of equipment where clean-burning fuels cannot be used.

 

Federal regulations mandate the use of ULSD fuel for both on-road (2007) and off-road (2010) vehicles, and in certain areas of the country already.  The ULSD must conform to the American Society of Testing and Materials (ASTM) D975 with the following additional specifications:

i.    ASTM D5453 15 ppm Sulfur maximum

ii.   ASTM D6078 Lubricity (SBOCLE) 3100g minimum

iii. ASTM D613 Cetane 45 minimum

 

Reduce emissions from construction equipment by using equipment that meets or exceeds applicable EPA emissions standards for on-road (e.g. 2004 model year) and non-road (e.g. Tier 2) equipment, when possible and available. Equipment should also be fitted with the best available pollution controls for particulate matter, when possible and available.

 

Many green construction contracts are starting to mandate the use of alternative fuels in heavy construction.  Why not get in front of regulations and adopt these practices now?  You may be surprised at the mileage you get from your customers by practicing simple green construction practices.

 Photo credit: http://www.flickr.com/photos/robseattle/34083190/

Top 4 Happiest Employees from Anti-Idling Policy

The EPA recently announced a $650,000 penalty against a Boston company for allowing its diesel engines to idle excessively in violation of the Clean Air Act. A Boston law firm noted that letting drivers start trucks before going inside to drink their coffee will not pass muster and neither will an un-enforced paper policy.  

I recently helped a green construction company draft a relatively simple anti-idling policy. The company was not mandated to have an anti-idling policy, yet enforcing the policy has been easy.  What has been difficult has been determining which employee has been the happiest about the anti-idling policy:

1. Head Mechanic: This is the group where the biggest resistance was expected.  These folks tend to really love their equipment.  This group of employees pointed out that anti-idling policies reduce hours on construction equipment.  Less hours means less wear and tear on the equipment and less wear and tear means less maintenance.   
2.  Granola Heads: This group was always going to be easy to please from the anti-idling policy.  Less idling reduces exhaust.  Vehicle exhaust contains harmful volatile organic compounds (VOC), particulate matter (PM), nitrogen oxides (NOx), carbon monoxide (CO), carbon dioxide (CO2) and other greenhouse gases, which contribute to urban smog, acid rain, poor air quality and has been linked to a variety of health problems
3. Accounting Manager: Less fuel + less maintenance costs = greater profits.  ‘Nuff said.  Green construction policies can equal more green. 
4. Operator: The EPA has concluded that long-term (i.e., chronic) inhalation exposure to diesel exhaust is likely to pose a lung cancer hazard to humans, as well as damage the lung in other ways depending on exposure.  They might never admit it, but the operators prefer being healthier. 

What was the last policy you implemented that made this many divergent groups happy at the same time?  Establishing an anti-idling policy now is a good and easy way to gain credibility when trying to win green construction contracts in the future.

Are there “green” provisions in a proposed contract you are bidding on?  Have you identified the risks of those clauses and are you prepared to handle those new contractual risks?  Click here to send us your contract and we will provide a complimentary attorney review.

The Construction Contract Review? Gee, what is that about?

I’m William J. Broderick, a construction partner in the sustainable law firm of Mayfield | Broderick.  My ARDC card says William and that’s how I signed my mortgage, but everyone calls me Bill, so feel free to do so as well.  If you want to contact me use wjb@SustainableLegal.com.

 

The[1] Construction Contract Review will be about……...wait for it…….construction contracts: how they are made, implemented, interpreted, and litigated.  I’ve represented the range of parties to a construction agreement: contractors, subcontractors, property owners, general contractors, architects and engineers.  Over the years, invariably every change order, delay, claim for extras, changed or unknown condition claim hinged on what exactly the contract meant.  I’ve found that a little attention to a contract before a project is started can save a lot of headaches, time, and money fighting about what the contract means after a project is completed.

Through this blog, I will attempt to write about and highlight various developments in construction agreements.  When looking at various court decisions from around the country, I always ask: could the contract been written better?  Well duh, with the benefit of 20/20 hindsight, I expect to appear brilliant.  I will try to provide tips, suggestions and ideas that contractors and owners can implement in their own construction agreements and find useful in avoiding making similar mistakes.  I hope other construction attorneys will join the expected conversations and provide yet another voice telling me why I'm an idiot.

If you would like tips, suggestions, and ideas on a specific construction contract that you are considering signing, send me a copy of the proposed contract and I will provide a complimentary attorney review.  Click here for more details. 

As you may have guessed from my email address, I have a tint of green in me that is more than just Irish heritage so topics may be slanted towards green construction issues.  I believe that sustainable or “green” construction practices will one day be as prevalent and accepted in the industry as OSHA and safety practices are today.  Acceptance of sustainability practices, like safety practices before them, may be slow and begrudging, but will eventually become standard, routine, and the price of working for certain clients.  I’ll try not to be judgmental or preaching but instead provide ways for contractors to differentiate themselves at the bidding stage, or owners to have a project reflect their own ecological values.

Thanks for stopping by.

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[1] Not an alum, but always enjoy on Sunday Night Football when a player is from THE Ohio State University, so I’m accenting the “the” as well.