Wow, can you believe that it is November already?! Boy, time travels quickly, especially if you are really busy. And Lake County Contractors Association has been busy. This past year we helped negotiate a three- year contract with the Operating Engineers as well as the Plasterers. We raised over $60,000 at our PAC Auction (thanks again, by the way, to all those who donated or purchased items). We placed twelve students from the Tech Campus into apprenticeship programs. Through the Government Affairs Committee we fought the Gross Receipts Tax and joined the Clean Water Coalition. They continued their affiliation with ICIC, LCP, and AHEAD.

Our Education Committee hosts a Career Expo for Lake County 8^th graders every year, and this year’s, held on May 8^th and 9^th, was attended by 450 students. We not only provide a construction tour for the Tech Campus students, but a safety training day as well. 120 students toured Key Lime Cove this year. The Committee also sponsored three management seminars. The Labor Committee again hosted our Labor Reception in the spring and participated in many worthwhile organizations such as MARBA and CISCO.

The Safety Committee updated the Safety Manual, renewed their alliance with OSHA, participated in the CCSC Safety Expo for which they created new booth graphics detailing safety services, and trained almost 250 member employees. The Program Committee continued enhancing and refining the Membership Meetings, the outings and the Winter Workshop and Mini-Workshop.

Gary Dowty is no slacker, either. He serves on the LCP board, the Waukegan Renaissance Commission, as ICIC Legislative Chair, the CLC Construction Curriculum Advisory Board, CISCO’s Legislative Committee, and the Lake County Tech Campus Building Trades Advisory Committee.

As you can see, our organization is very active, not only locally but statewide as well for the benefit of our members and industry. I am very proud not only of this Association’s accomplishments but its members as well. Thank you all for making Lake County Contractors Association the stellar organization it is.

Wolf Holland & Solovy LLP

ASSOCIATE
Steven B. Holland, Partner
Law firm.
Sponsor: Marc Gilman, Jos. J. Henderson

40 Skokie Blvd., Suite 105
Northbrook, IL 60062
Phone: (224) 330-1717
Fax: (224) 330-1715

Zurich North America - Construction

ASSOCIATE
Patti Heffernan, Sr. Account Executive
Insurance
Sponsor: Jim Drost, HRH

10 S. Riverside Plaza
Chicago, IL 60606
Phone: (312) 496-2400
Fax: (312) 496-9350

Scott Nelson, H.H. Holmes Testing Laboratories, Inc., will receive the 2007 Governors Award during the Annual Meeting. According to President Micky Day, “Scott deserves LCCA’s highest honor given his long commitment to LCCA.”

Mr. Nelson has chaired the Golf Outing since 1998 and has been responsible for a significant increase in participation over the years. He has also brought his creative vision to many programs and meetings of the association looking for ways to increase the appeal. Since 2000, Scott has also served on the Board of Governors.

You have spoken and the Members of the Year have been selected. The ultimate honor is to be selected by your peers as the best company to work for or with and our Members of the Year are the best of the best. Every LCCA member has the opportunity to vote for a member in each of the categories of membership EXCEPT their own. Here are the results:

General/Prime Contractor – Berger Excavating Contractors
Subcontractor – Lake County Grading Co.
Supplier – Jack Frost Ironworks, Inc.
Associate – Abbott Laboratories

According to President Micky Day, DK Contractors, almost 114 LCCA members received a vote and the final results were very close. We will be recognizing the winners at the Annual Meeting November 2. Thanks to all who voted. Your vote does count at LCCA!

The APEX, or Award for Project EXcellence, is presented to a LCCA member project that was completed in the last year. Projects were judged on: Quality of construction, Design/Engineering, Impact on the community, Cooperation among parties, and Safety record. This year we are pleased to award the APEX to W.B. Olson, Inc. for the Hinkston Park Field House project. The Waukegan Park District, and PHN Architects collaborated with W.B. Olson and several other LCCA members to create a “Prominent Gateway to Waukegan” and it exceeded everybody’s expectations.

The Field House is an 84,000 sq. ft. center which houses six full-size basketball courts in a clear span 200’ by 200’ area. In addition, the facility includes an elevated running track, a three story climbing wall, fitness center and more.

In addition, we will recognize the Runner Up projects including:

Jos. J. Henderson & Son – Highland Park Police Headquarters
Alliance Contractors – McHenry Riverwalk
W.B. Olson, Inc. – Ravinia Food Pavilion
Berger Excavating – Fairfield & Gilmer Road Grade Separation
Boller Construction Co. – Lake County Adult Probation Office Remodel
Midwest Masonry, Inc – Providence of Palatine
Wm. A. Randolph – The Shops at Fox River

Judging the contest this year was: Rob Twardock, College of Lake County; Robin Schabes, City of Waukegan and Lynn Karner, Plumbers Local 93.

LCCA 1947 – 2007 Remember when. .

Cost of a New House	$6,650
Average Annual Income	$2,854
Cost of a New Car	$1,290
Average Monthly Rent	$68
Annual Tuition to Harvard University	$420
Cost per Gallon of Gasoline	15¢

Thanksgiving Holiday Pay Differs - As we approach another holiday, it is important to know just what your labor agreements require for payments of wages and fringes during the holiday season. All agreements recognize Thursday, November 23, 2006, as the official holiday and require double time if you work the day.

The Friday after Thanksgiving can be an issue. Most contracts consider this a “straight time day”, but some, like the Elevator Constructors and Teamsters Ready-Mix Concrete agreement consider the day a holiday. Some agreements also require Holiday Pay for certain employees.

Technical Engineers Lose Benefit Lawsuit – The seventh Circuit Court of Appeals entered a decision in favor of Wm. A. Randolph in a lawsuit filed by the Technical Engineering Fringe Benefit Funds. The contractor had subcontracted survey work to a non-union company and the Funds filed a lawsuit seeking contributions for all the hours worked by the subcontractor. The contractor was successful at the Federal District court level, but the Funds appealed the decision. A key finding by the appeals Court was “the collective bargaining agreement states that subcontractors are not employees for whom contributions to the multi-employer pension funds must be made.” The Appeals Court stated that “the appeal has no merit” and that the appeal was filed “without substantial justification.” Additionally, the Funds were ordered to reimburse the contractor for “his reasonable attorneys’ fees for defending the appeal.” It’s nice to win one occasionally!

Is Your Sub Really Union? – In this day of just looking for the low bid, contractors often are using subcontractors who may not be union – or may be the “wrong” union! With the increased prevalence of subcontractor clauses in contracts today, you must pay attention to not only if they are union, but what union they are signatory to. To avoid work stoppages and liability for unpaid wages and benefits, you need to be sure before the project starts. For example:

--  Your sewer contractor is signatory to Operators but not Laborers. There is no jurisdiction for pipe layers in the Operators Agreement.

--  A sub claims to be union but the “union” they are signatory to is: 1. Not in this area, 2. Not a real construction union, or 3. Not a union with jurisdiction over the work.

The reality is that some contractors will tell you what you want to hear to get a job. Before you let a subcontract, you need to:

--  Make sure your contract has a provision that they must be signatory to the appropriate union agreement for the employees they intend to use on the project.

--  Make sure they state the unions they are signatory to so that you will have a heads-up for any potential jurisdictional issues before the project starts.

--  The contract should also require the sub to pay all benefits and wages as specified by the current union agreement (if they don’t, you probably will).

--  If you have any doubts, contact the union and ask if the potential sub is signatory and current on their benefits.

Check with your attorney for appropriate contract language and make sure you are protected from subs that skirt the rules just to get a job.

The Illinois Department of Public Health has issued a proposed rule, "Smoke Free Illinois Code," to implement the statewide smoking ban law. Public Act 95-17, which goes into effect January 1, 2008, prohibits smoking in public places or places of employment. PA 95-17 defines "public place" as that part of any building or vehicle used by and open to the public, whether or not the building or vehicle is owned wholly or partially by private or public entities and whether or not a fee is charged for admission. The Act prohibits smoking within 15 feet of entrances, exits, windows that open, or ventilation intakes that serve enclosed areas where smoking is prohibited. The Act defines private clubs, bowling alleys, restaurants, public restrooms, and numerous other locations as public places. Responsibilities of employers are provided in the law and are being clarified by the rule.

"No Smoking" signs must be posted, and ashtrays must be removed. The Department of Public Health, State-certified local public health departments, and local law enforcement will enforce the provisions of the Act, and complaints may be registered with these agencies. The rulemaking sets forth fines for violations of the Act of $100 to $250 per occurrence for individuals who smoke in prohibited areas and $250 to $2,500 for business owners, employers, and others who permit smoking in prohibited areas under their control. The rulemaking also prohibits discrimination against individuals who exercise their rights under the Act.

The U.S. Senate gave its final approval to the Water Resources Development Act of 2007 (WRDA) in late September after the House signed off on the legislation in August. The WRDA, which now sits on the President’s desk, is critical to both the nation’s overall waterway infrastructure and Illinois’ ability to make crucial updates to the locks and dams along the Upper Mississippi and Illinois rivers. Despite the importance the legislation bears on the economic viability of Illinois and the nation, the President has threatened to veto the legislation, claiming the bill “fails to exercise fiscal discipline.” Numerous organizations, including the U.S. Chamber of Commerce and the American Society of Civil Engineers, as well as Republican senators and representatives, have urged the president to sign the WRDA.

The WRDA received enough votes in both the Senate and the House to override a presidential veto. A veto would only further delay final passage of the bill.

Prompt Payment Act Effective August 31 - Contractors and subcontractors in Illinois were recently equipped with a new legal tool to encourage timely payments from upstream parties. Earlier this year, the Illinois General Assembly passed the Contractor Prompt Payment Act, Public Act 95-0567, which became effective for contracts entered on or after August 31, 2007. The Contractor Prompt Payment Act (the “Act”) provides deadlines for approval and payment of pay applications for (1) contractors seeking payment from owners; and (2) subcontractors seeking payment from contractors and penalties for non-compliance.

For contractors seeking payment from owners, the Act provides that an owner shall pay the contractor within 15 calendar days from the date of the owner’s approval of the contractor’s pay application. It further provides that a contractor’s pay application will be deemed approved 25 days after the owner receives the pay application unless, within that 25 day period, the owner submits a written statement to the contractor setting forth the amount withheld and the reasons for withholding. The owner, however, can only withhold an amount commensurate with the portion of the work that is nonconforming.

For subcontractors seeking payment from contractors, the Act requires a subcontractor to be paid within 15 calendar days of the contractor’s receipt of payment from the owner. This provision also protects sub-subcontractors, suppliers and other companies that are entitled to mechanics liens under the Mechanics Lien Act.

If an owner or a contractor fails to comply with these deadlines, the claimant is entitled to the unpaid sum in the pay application plus 10% interest per year. Further, if a contractor or subcontractor is not paid according to the Act, the contractor and subcontractor can, upon 7 days written notice, suspend its performance on the project, without penalty for breach of contract, until payment under the Act is made.

Thus, an owner’s obligations under the Act are to respond in writing within 25 days of receiving a payment application and to pay the contractor within 15 days of approving that application. The contractor’s obligation is to pay its subcontractors within 15 days of receiving payment from the owner.

The Act raises some significant practice questions. For instance, we expect that owners will require, in the prime contracts, that contractors waive their rights under the Act. Whether courts will permit a waiver of the provisions of the Act is unknown. If a contractor waives its rights under the Act the contractor will need to include similar waivers in contracts to downstream parties.

Further complications arise when a construction project involves a construction escrow. A dispute will likely arise as to when and who “approves” a pay application for purposes of the Act. The owner’s approval could occur when it submits an owner’s sworn statement to the title company listing the amount to be paid to the contractor. In such a case, a title company may have difficulties reviewing pay applications and disbursing funds within 15 days from the date of the owner’s sworn statement. Moreover, whether a title company’s acceptance and disbursement of a pay application triggers the 15 days limitation and binds the owner is also a concern.

Rather than comply with the restrictions in the Act, upstream parties may issue blanket or routine withholding notices to downstream parties to allow sufficient time for pay application review, approval and disbursement. Because the Act provides no standards to govern the legitimacy of the reasons given by the upstream party, such subversive practices could avoid the consequences of the Act. (Article submitted by Ogletree Deakins’s Construction Industry Group (312) 558-1220.)

Applications are now available for the Construction Industry Service Corporation’s (CISCO) 2008 Scholarship Program. Applications for both the two-year Continuing Education and the four-year scholarships are available now at www.cisco.org/schol.htm or by calling CISCO at 630-472-9411. The candidate must be a child of a member of a building trades union or a non-bargaining unit employee of a union contractor that is affiliated with CISCO. This would include all LCCA Contractor members. All children of CISCO members are encouraged to apply.

Each year, four 4-year scholarships valued at $2,000 per year, and two 2-year Continuing Education scholarships valued at $1,000 per year are awarded. This is a great opportunity to get help with your education expense.

Completed applications, along with all required materials, must be returned to CISCO by February 15, 2008. Winners will be notified March 31 and awards will be presented at CISCO’s Annual Luncheon on April 25^th.