Construction Law Signal

Construction Law Signal

Insights & Information on Current & Emerging Developments affecting the Construction Industry

$113M in Construction Financing Approved for One of Washington D.C.'s Most Ambitious Projects – the "Wharf"

Posted in Construction, District of Columbia, Real Estate

The developers of the Wharf, an ongoing waterfront development at 1100 Maine Avenue SW in Washington, D.C., recently announced that they have secured $113 million of debt financing for the project. PN Hoffman and Madison Marquette, the project’s developers, will use the financing to pay for the construction of two new hotels, the 175-room Canopy by Hilton and the 237-key Hyatt House hotel, scheduled to open later next year. SunTrust Bank and M&T Bank will provide the financing.

The announcement is the latest step in an ambitious plan to transform approximately 25 acres along a mile of waterfront of the nation’s capital into a desirable, livable destination complete with hotels, condos, rental housing, retail, and restaurants.

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Lights Out for Maryland's Power Plant Construction Subsidy Program

Posted in Construction, Energy, Maryland

IOil and gas industry - refinery, factory, petrochemical plantt’s not every day that a decision by the United States Supreme Court has the potential to impact the construction industry. But the Court handed down a decision last month that could hinder the pace of power plant construction around the country. In Hughes v. Talen Energy Marketing, LLC, the Court unanimously struck down a Maryland regulatory program that provided subsidies to incentivize new power plant construction in the state. According to the Court, the program intruded on the federal government’s authority to regulate the interstate wholesale market for electricity. Because several other states have similar programs, more cases challenging state power plant construction incentives could be on the horizon.

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Does your Employee Handbook stand up to the Supreme Court's latest decision about accommodations for pregnant workers?

Posted in Business, Compliance, Labor and Employment

In a recent U.S. Supreme Court case about pregnancy discrimination, Justice Breyer asked: “Why, when the employer accommodated so many, could it not accommodate pregnant women as well?”  As an employer, that is a question you should now be asking when preparing, reviewing, or updating your company’s accommodation policies.

Many employersEmployee Benefits have policies and practices to ensure accommodation of disabled workers or those with temporary injuries or disabilities. However, employers may be overlooking their legal obligations to accommodate another group of workers: pregnant women who have pregnancy-related work limitations.

In Young v. United Parcel Service, the Court addressed whether UPS’s treatment of a pregnant employee constituted pregnancy discrimination. Its decision effectively broadens the range of accommodations employers must provide to a pregnant employee.

Peggy Young was a UPS delivery driver. When Young became pregnant, her medical providers instructed her not to lift more than 20 pounds. As a result, Young was unable to fulfill UPS’s standard 70-pound lifting requirement. Young was not assigned to light duty or an alternate position, but was required to take a leave of absence while the lifting restriction remained in place. She was forced to take unpaid leave and lost her medical coverage during that time. Continue Reading

Attention Philadelphia Employers: New and Important Changes to the "Ban The Box" Law

Posted in Labor and Employment, Pennsylvania

Philadelphia’s 2011 “Ban the Box” lawemployment-applications.jpg, which restricts an employer’s ability to inquire into a job applicant’s criminal history at the initial stages of the application process, is “old news” – but the recent changes that went into effect on March 14, 2016 are anything but. Our firm will be getting into the details of this recent development at its 8th Annual Labor and Employment Seminar (April 27, May 4, and May 12).

In short, every Philadelphia employer needs to make the necessary changes to its job application procedures to comply with the broader requirements of the law that former Mayor Michael Nutter signed into law before leaving office in December 2015.

The 2011 Version

As enacted in 2011, Philadelphia employers with 10 or more employees could not include the “box” on a job application asking about criminal records. Employers were not permitted to ask about criminal records at an initial interview, but could do so after the first interview. And, when asking about a criminal background, employers were prohibited from asking about arrests or anything other than criminal convictions. Violations of the law carried up to a $2,000 penalty.

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Maryland Approves P3 Contract for Purple Line Light Rail Project

Posted in Maryland, Transportation

Rails to TrailsThe Maryland Department of Transportation/Maryland Transit Administration (MDOT/MTA) recently announced its selection of Purple Line Transit Partners as the concessionaire for the new 16.2 mile, 21-station, light rail Purple Line that will run through Montgomery and Prince George’s counties. On April 6, 2016, the Maryland Board of Public Works, comprised of Governor Larry Hogan, Treasurer Nancy Kopp, and Comptroller Peter Franchot, unanimously approved the public private partnership agreement with Purple Line Transit Partners.

We have been following the development of this project for several years. In 2013, Maryland identified it as the first P3 project under new legislation that updated its Public Private Partnership law to facilitate the use of P3s.

There were questions about the viability of the project in 2014 during the gubernatorial election cycle. But after taking office in January 2015, Governor Larry Hogan gave conditional approval to a reduced-cost version of the Purple Line project and outlined three criteria for approval of the project: (1) additional financial support from Montgomery and Prince George’s counties; (2) reserved federal funding; and (3) aggressive pricing from the successful team. Montgomery and Prince George’s counties pledged $330 million in cash and non-cash contributions to the project. The federal government reserved approximately $900 million for the project, with $125 million recommended for FY 2017. Finally, the initial state expenditure for construction cost was reduced by $8 million to $159.8 million, and the amount of the average annual availability payments was reduced by $18 million to $149 million per year over thirty (30) years. As a result, the project is reportedly coming in $550 million below prior estimates, and the Governor approved moving forward with the project.

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Real Estate 101: Knowing Your Property Value and Challenging Your Tax Assessment

Posted in Business, Pennsylvania, Real Estate, Tax

After months, maybe years, of planning, raising capital, obtaining permits and waiting out construction, your gleaming new building is open and occupied. Soon, you’ll get a simple, one-page letter from your county’s Tax Assessment Office. What should you do if that letter indicates that your property is worth about a half-million dollars more than your appraisal reflects? Every Pennsylvania property owner is entitled to an annual appeal of their property assessment through the real estate tax assessment appeal process. Knowing the value of your property, your tax liability and whether you can reduce your tax burden through an appeal is as critical as managing any other area of your financial portfolio.

Calculating your Property Tax and Fair Market Value (FMV)

In Pennsylvania, real property typically incurs school, city/township and county taxes. Each of the three taxes is assigned a millage rate, which is used to calculate the property’s tax liability. To calculate the total real estate tax owed, the total millage of all of the taxing authorities is multiplied by the property’s assessed value. It is important to note that tax assessment appeals only challenge the assessed value of your property, NOT the imposed millage rate. Millage rates are published on each county’s website.

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Can a Contractor Sue a Design Professional Without a Contract? Not in Maryland

Posted in Contract, Design and Technology, Maryland

In some states, courts allow contractors to sue design professionals for negligence even in the absence of a contract. In others, like Maryland, courts apply a rule known as the Economic Loss Rule (ELR) to bar such claims. Courts apply the ELR when, without a contract in place, someone sues another for purely financial losses (i.e., not for personal injuries or property damage). The ELR is very important in the construction world because contractors who sustain losses that they attribute to substandard design documents often sue the design professional who prepared the plans and specifications, even though they rarely have a contract with the designer.

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In a recent case – Balfour Beatty Infrastructure, Inc. v. Rummel Klepper & Kahl, LLP – the Maryland Court of Special Appeals (“Court”) reaffirmed the ELR and rejected various claims brought by a contractor against a design professional. The Balfour Beatty Infrastructure case involved a public works project for the City of Baltimore (“City”). The City entered into contracts with the design and engineering firm Rummel Klepper & Kahl, LLP (“RK & K”) to upgrade a water treatment plant. The City also entered into a contract with Balfour Beatty Infrastructure, Inc. (“Balfour”) to build the upgrades. Balfour did not have a contract with RK & K. Due to a series of design errors, Balfour suffered delays during construction and performed additional work that it attributed to the design errors. Based on these facts, Balfour sued RK & K for professional negligence and negligent misrepresentation, alleging that RK & K supplied false information to prospective bidders and failed to establish a  reasonable contract duration.

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Attention Philadelphia Contractors: Do You Comply with OSHA Training and Supervision Requirements?

Posted in Compliance, Construction

The City of Philadelphia has issued new code requirements for construction worker safety training. The new rules went into effect on October 1, 2015, and the Department of Licenses and Inspections has announced that strict enforcement will begin on April 1, 2016.

Under the new regulations, all contractors and employees (including subcontractors) performing construction or demolition work in the City of Philadelphia for which permits have been issued are now required to complete OSHA 10 safety training, or an approved equivalent. This requirement applies to all trades, as well as state-registered home improvement contractors. Workers are required to carry written proof establishing that they have completed an OSHA 10 training course while on the job site, and their employers must also maintain on-site proof of completion for each worker. This information must be furnished to the Department of Licenses and Inspections upon request. The OSHA 10 training is only required to be completed once and does not expire.

Additionally, all contractors licensed under Section 9-1004 of the Philadelphia Code must employ at least one supervisory employee who has completed OSHA 30 safety training, or an approved equivalent, within the past 5 years. Construction or demolition of major buildings requires continuous oversight by a site safety manager who has completed an OSHA 30 course. The designated site safety manager must carry an identification card or certificate of completion issued by the provider of the OSHA 30 training course.

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Lisa Wampler Named Managing Partner of Cohen Seglias' Pittsburgh Office

Posted in Firm News, Lisa Wampler

Cohen Seglias has announced the promotion of Lisa M. Wampler to Managing Partner of the Firm’s Pittsburgh office. The announcement marks the first female managing partner in the Firm’s history.

“Lisa has been instrumental in the growth of our construction practice in Pittsburgh. She has proven leadership skills and continues to be a great ambassador for the Firm in Western PA,” said Jason Copley, Cohen Seglias’ Firmwide Managing Partner.

Lisa joined Cohen Seglias in 2003 with the opening of the Pittsburgh office. Since that time, she has developed an active and diverse construction litigation practice. She represents owners, general contractors, construction managers, and the different trades in complex matters involving all phases of the construction process, including negotiating and drafting contracts, and advising clients as to preparing claims for extra work, inefficiencies, delays, and changed conditions while construction is ongoing for both private and public sector projects.

In addition, Lisa serves as the Chair of the Firm’s Women’s Initiative. She is active in a number of professional organizations, including the American Subcontractors Association, Master Builders Association, Associated Builders and Contractors, National Electrical Contractors Association, Commercial Real Estate Women, and sits on the council of the Allegheny County Bar Association’s Women in the Law Division and Construction Law Section.

Cohen Seglias numbers 60 attorneys in nine locations, including five attorneys in the Pittsburgh office, which is centrally located at 525 William Penn Place. Lisa can be reached at lwampler@cohenseglias.com or 412.434.5530

Up in the Air: Drones and the Future of the Construction Job Site

Posted in Construction

Unmanned aerial vehicles, commonly referred to as “drones,” are appearing more frequently in the skies over construction project sites.

Drones  typically operate from a handheld device, such as an iPhone, and can be connected to a Wi-Fi network. The physical design utilizes four to eight rotary blades, which allow for fluid vertical movement and aerial stability. Such stability—the ability to hover in place for an extended period of time—can prove particularly beneficial for surveying a job site. Drones can be used to capture images of the work from above and then transmit the information to one of a number of mapping software programs, which are, in turn, used to analyze and monitor all phases of a project, from site preparation to completion.

Drones also are proving to be a valuable marketing tool, by allowing for aerial footage or video of job sites, which can be shown to clients and potential clients. In the near future, drones may be used for physical transportation of equipment and project materials. Indeed, multinationals, including Amazon and Google, have famously begun discussing the use of drones to transport and deliver goods to their customers.

Drone technology possesses the potential to fundamentally change the construction industry.

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