A Parting Shot From Senator Joe Coniglio

Call your legislators and let them know you are watching. n/t (4.00 / 1)

---

by: Creed Pogue @ Wed Dec 12, 2007 at 21:12:04 PM UTC

Yayyyy! We Are in 100% Agreement! lol n/t (0.00 / 0)

---

by: Nick Lento @ Wed Dec 12, 2007 at 21:31:15 PM UTC

[ Parent ]

The NJ State League of Municipalities is reporting that the contractor associations have given up on the bill. n/t (0.00 / 0)

---

by: Creed Pogue @ Thu Dec 13, 2007 at 03:52:28 AM UTC

[ Parent ]

Here's The Text Of.... (0.00 / 0)

...the NJLM announcement.

http://www.njslom.or...

December 11, 2007
Re: S-2955
Contractors' Relief Bill

Dear Mayor:

We are pleased to inform you of the very latest good news on S-2955 which would have provided relief to private contractors at public expense. We have learned the various contractor associations have abandoned their efforts at seeking adoption of this bill.

If you recall, S-2955, the Material Price Stabilization bill, proposed to amend the Local Public Contracts Law to require municipalities to pay the contractor for any increase in price of construction materials and in case of a de-escalation in price, municipalities would be credited or paid in cash by the contractor.

From the outset, the League knew this bill would have threatened the stability of capital budgets of all local jurisdictions, create opportunities for price manipulation by contractors and increase the complexity of public contracting.

The collective assistance of all of the groups opposed to S-2955 and your immediate response to our call were instrumental in derailing this proposal. Although the contractor groups have discontinued their efforts in the face of tremendous opposition, we shall remain vigilant during the next legislative session.

On one hand, this may now seem like a moot issue; on the other, the text refers to the need for "vigilance".  So let's keep our antennae tuned to this particularscam/angle in the future.

I would love to know who strategized the legislative fast track for this dog and why they thought they could get away with it. 

(Thanks to Creed for digging up the latest news!)

Meanwhile, the pay-to-play express continues to roll.  Let's all stay tuned and be ready to turn the spotlights on at a moments notice. 

Evidently sunshine is still the best disinfectant!

 

---

by: Nick Lento @ Thu Dec 13, 2007 at 16:56:53 PM UTC

Erroneous (4.00 / 1)

Given that there is no link to the story, I can't really say how off the reporter was, but it's pretty obvious that you didn't bother to read the bill.

Let's take a look, shall we:

Any contracting unit that enters into a contract for construction pursuant to the provisions of P.L.1971, c.198 (C.40A:11-1 et seq.), shall include in the contract a material price stabilization clause that provides for adjusting the price of a material purchased during the term of the contract, the value of which exceeds five percent of the contract value, if the material's price increases or decreases by at least two times the percentage change in the Producer Price Index for Inputs to Construction Industries, as published by the United States Department of Labor, Bureau of Labor Statistics, at any time during the term of the contract.  The contractor may provide to the project owner, a list of those items included in the contract, and subcontracts, which exceed the five percent threshold.  These items shall be deemed eligible items.  No price adjustment upward or downward shall be made for any item not identified as an eligible item by the contractor at the time of bid, unless, as a result of post bid change orders, a material not valued in excess of five percent of the contract value at the time of bid now exceeds the five percent threshold.  The contractor awarded the project shall disclose to the project owner the price included in the contractor's bid for eligible items, and shall be required to document the actual cost for the purchase of the eligible items to be deemed eligible for a material price adjustment.  The material price stabilization clause shall be applicable to every party to the contract, including subcontractors.

  In the case of a subcontract, of any tier, "contract value" in this section means the total value of that individual subcontractor's contract with the prime contractor, general contractor, or higher tier subcontractor.

  The material price stabilization clause shall provide that the adjustment shall only apply to the difference between the actual price paid by the contractor or subcontractor and the price relied upon by the contractor or subcontractor as the basis for the contractor's bid for the project.  The material price stabilization clause may also provide that any contractor bidding on a construction project shall submit written copies of contracts or quotes for the material in question which were relied upon by the contractor or subcontractor in the determination of the bid amount which shall be attested to by the contractor or subcontractor and shall be submitted with the bid in a sealed envelope which the contracting unit shall hold unopened until a claim is made pursuant to this section.  Additionally, the material price stabilization clause may provide that any contractor or subcontractor who makes such a claim shall supply written copies of the contracts or invoices for the actual cost paid for the material in question which shall be attested to by the contractor or subcontractor.  Disputes under the material price stabilization clause of any contract shall be remedied through the alternative dispute resolution process established pursuant to P.L.1997, c.371 (C.40A:11-50 et seq.). 

  The adjustment shall be paid, as appropriate, to either a contracting unit in the event of a downward adjustment, or to a contractor or subcontractor in the event of an upward adjustment. Adjustments in price under the material price stabilization clause shall be made on a monthly basis, as part of regular progress payments during the term of the contract, or at some other regular interval as set forth by the project owner in the bid specifications, but in no event shall adjustments be made less than one time per contract term or one time per year, whichever is less.  The price adjustment shall be the difference between the contractor's or subcontractor's bid price for the specific material, as provided and attested to the owner, increased by two times the percentage increase in the Producer Price Index for Inputs to Construction Industries, and the actual price paid by the contractor or subcontractor for the specific material.  Any price adjustment made by a contracting unit pursuant to this act shall not be used in calculating the change order limitations pursuant to N.J.A.C. 5:30-11.1 et seq.

Now, that's a lot of legalese mumbo-jumbo, but I high-lighted the important parts.

In layman's terms, this bill provides protections to contractors working on public works projects against price spikes in raw materials.  The only adjustments that can be made to the contract price under this law are for raw materials (i.e. gas, steel, concrete) - contractors can't arbitrarily raise the price to pad their profits.  Plus, the change in price has to be significant - twice the change in the Producer Price Index for Inputs to Construction Industries (which was 4.6% in 2006, but was as high as 9.1% in 2004) - that means that the costs have to go up a great deal for the contractor to recover more money.  Also, to get the adjustment, contractors must give proof that the prices they have provided in the bid are accurate when they bid and then submit proof that the price they would have to pay in order to obtain the materials is higher.

The sad truth is that we live in a time where the raw materials used in contruction projects are prone to dramatic price shifts.  As China and other developing nations continue to ramp up their contruction efforts, the demand for raw materials goes up and so do the prices.  So that means that in the time between the bidding process and the construction process, builders are seeing significant changes in costs - changes that are eating up some, if not all of the profits the companies are set to make.

Maybe you don't care about the profits of building companies or there ability to conduct business - and if you do, then go ahead and criticize this bill all you want.  But if you just read the bill, then it's pretty clear that this bill has absolutely nothing to do with pay-to-play.

I guess what I'm trying to say is that we all need to make sure that we stay intellectually honest as we fight against pay-to-play and push for ethics reform.  Take time to read the actual bill and don't just rely on a single editorial to begin crying "play-to-play!"  When you try to find some type of link to pay-to-play in everything done in government, you really dilute the effectiveness of arguments made against actions that really are examples of pay-to-play.

---

by: PocketAces @ Thu Dec 13, 2007 at 17:11:10 PM UTC

Sorry, I Don't Buy It (0.00 / 0)

There were no hearings or public discussion/scrutiny of the bill.  Why?

The letter from the New Jersey State League of Municipalities was quite telling.  They were, rightly, happy that this "dog didn't hunt".

I doubt that they are raving Ralph Nader type reformers there.  Why do yo think they were so pleased that the proponents pulled the bill?

This smells a lot like the kinds of "cost plus" contracting that our defense department is so fond of.  It has boondoggle written all over it.

Would the town then have the right to lower the final contract price if the cost of materials went down?  Why not write that into the bill too?

Yes, obviously there may be a rare situation in which this is a legitimate issue; but that should be dealt with as it arises. 

A contract is a contract, and sometimes folks might have to eat a loss to honor their contract.  That's the way it is in the private sector. 

Why should contractors being payed by the taxpayers be insulated from any risks?

Another angle is that this bill would give folks an incentive to lowball based on unsound "estimates" of costs; then once the contract is signed they would legally up the price.

The bottom line is this bill is dead for now.  And that's a good thing.

If it has any merit; let there be extensive public hearings where BOTH sides can have a thorough airing out of all the facts. 

If there's some kind of history of large numbers of contractors losing their shirts because of materials going up in price overnight, let's hear about it.  Let's get some testimony and evidence.

Maybe, after a few months of close scrutiny and lots of Light shined into all the legalistic nooks and crannys, it'll turn out to be a good idea; but forgive me if I just don't take your word for it.

Meanwhile, I'm very happy to hear that you seem to be in sympathy with eliminating the pay to play system!  That's wonderful!

When we get to a place where all campaigns are publicly funded, there will be zero reason for legislators to feel unduly pressured by billion dollar industries like this one.  In that world, we may not have to be as vigilant; but we have a long way to go.

---

by: Nick Lento @ Fri Dec 14, 2007 at 00:48:01 AM UTC

[ Parent ]

Still erroneous (4.00 / 2)

Nick, let me invite you to the real world where there are facts, and people investigate those facts before they make baseless claims like your response.

You said:

There were no hearings or public discussion/scrutiny of the bill.  Why?

But there was a hearing and public discussion of the bill.  It was discussed with another related bill for 50 minutes in the Senate State Government Committee before being voted out 4-1 (with a vote by Loretta Weinberg).  And on this point, you even contradict yourself, as you pointed out it was reported from committee on that day.  If you want and go listen to that testimony, it starts at about the 2:40 mark on the audio archive.

Next, you said:

Would the town then have the right to lower the final contract price if the cost of materials went down?  Why not write that into the bill too?

Yes, the towns would have that right.  I even cut and pasted the meat of the bill right into my comment and you still didn't bother to read it.  The bill says:

The adjustment shall be paid, as appropriate, to either a contracting unit in the event of a downward adjustment, or to a contractor or subcontractor in the event of an upward adjustment. Adjustments in price under the material price stabilization clause shall be made on a monthly basis, as part of regular progress payments during the term of the contract, or at some other regular interval as set forth by the project owner in the bid specifications, but in no event shall adjustments be made less than one time per contract term or one time per year, whichever is less.

And finally, you said:

A contract is a contract, and sometimes folks might have to eat a loss to honor their contract.  That's the way it is in the private sector.

Why should contractors being payed by the taxpayers be insulated from any risks?

Another angle is that this bill would give folks an incentive to lowball based on unsound "estimates" of costs; then once the contract is signed they would legally up the price.

Now, I'll admit that I'm not the most familiar person in the world with the intricacies of the public bidding and contract process, but I did gain a basic knowledge when my local school district did a bunch of construction projects a few years back.  What was clear was that these contracts are not indelible edicts.  The contracting entity (town, school district) can and often will put in a change order on a construction project, which can add new requirements, take away old requirements or change the materials used.  So a contract is not a contract.

Your last point is a good one, and while bidding laws might have a say in whether this can happen, my knowledge is limited and I would hope this concern would be addressed at some point. I'm sure there is also concern by the League that this will lead to certain uncertainties in budgeting for future projects.  But let's be honest, they're going to oppose this because it will could mean that towns will have to spend more money to build new projects.

On the flip side, I imagine the status quo in materials pricing might lead to the following problems: 1) inflation of bid prices to protect against price increases; 2) switches to inferior materials after a price jump; 3) quality contractors staying out of public contracts because there's no money in it.  Additionally, (and building in #1) contractors will be more likely to bid with more competitive prices with this bill in place.  That being said, I'm not convinced either way if this bill is good or not.

But if you're going to attack a bill, then do it on the facts and merits of the bill, not on false assumptions and what you imagine to be true.  It's hard enough to advance the progressive agenda without poorly constructed arguments like the ones you are making here.

---

by: PocketAces @ Fri Dec 14, 2007 at 05:06:51 AM UTC

[ Parent ]

Quibbles and Bits (1.00 / 1)

First, thank you for taking the time to read and closely scrutinize my every word.  I appreciate that.  Then again, if you can translate legalese; my amateurish prose must be a cakewalk.

I stand corrected, sort of, apparently the bill was "discussed" along with a related bill for all of 50 minutes.  Let's add that fact to the infinite list of stuff I didn't (and still don't ;-) know.  Please excuse me for not having heard about it. 

My blog was written within twenty minutes of having picked up my local freebie newspaper off the porch.  I quoted from the editorial there because it all rang true to me.

And guess what, pocket aces?  It still rings true to me.

The quibbling points you have raised are, obviously valid in a technical sense.

If I were the head of the contractors association and I were looking to hire a lobbyist/PR person top put the best face possible on this dog; I would hire you and pay you well. (Now you have my endorsement for your resume! ;-)

Even granting all of the valid points you made in opposition to my imperfect and flawed (but still essentially correct ;-) blog you some out and say:

"That being said, I'm not convinced either way if this bill is good or not."

That's why the title of this comment isn't "Still Not Buying It".  Evidently, you ain't sold either.  lol

I find it ironic that you seem to have an extremely high journalistic standard for someone blogging off an editorial in a newspaper; yet, outside of that little piece in a local freebie, there was practically no substantive coverage of this bill anywhere in the state. 

Think about that.  Here the legislature is about to vote on a bill that changes the way all contracts are governed throughout New Jersey.  The impact would be one of many millions of dollars (mostly aced out of the pockets of NJ taxpayers and into those of contractors).  Yet, nary a smidge of publicity or a note of controversy.  Why?

I assure you that the architect of this edifice, Joe Coniglio is familiar with the "Bergen News" as it's in his district.  It's pretty nifty that all it (evidently) took to derail this express train was a spark of light; one tiny little editorial in a small freely distributed local independent newspaper!  Kudos to editor Douglas E. Hall on this one. (with whom I also often disagree!  lol)

Now, if there is any objective merit to this bill; let there be a serious and truly thorough debate/discussion in which all parties can be brought to the public hearing table so that they can attest to their particular understandings of the realities and facts that surround this proposal.

As for the pay to play angle, it still stinks.  It's not about "free speech".  No contractor, or anyone in their employ, or anyone who profits (i.e. shareholders) should be able to bribe elected officials with "contributions"; period.

!00% public financing of campaigns is not a panacea for all corruption; but it's the closest single measure to one.

So, dear holder of high ranking cards in the hole, I thank you for your good advice and for the opportunity to shed some more light on this matter! 

Please feel free to continue this exploration as I'm sure that there are plenty of other imperfections in my meagre efforts you can pick apart.

Meanwhile, lest y'all start to think I'm in league with the NJLM, here's one of their positions that I most strongly oppose:  http://www.njslom.or...

---

by: Nick Lento @ Fri Dec 14, 2007 at 15:10:00 PM UTC

[ Parent ]

The one positive I can see... (0.00 / 0)

If this was implemented at least it would require contractors to clearly define what they consider 'material costs' and what are the actual 'labor costs'. I can't tell you how frustrating it is to deal with a contractor, ask for a price on anything, and they will not quote hourly, but 'by the job'. I've never reviewed a public works bid, but I'd imaging the material costs are defined as loosely as possible as well.

"Where ever you go, there you are." - Buckaroo Bonzai

---

by: William Weber (WjcW) @ Mon Dec 17, 2007 at 15:38:31 PM UTC

[ Parent ]

You Raise a Great Point! (0.00 / 0)

I'm not an attorney; but it seems that the kind of situation you describe should not be legal.

If it is; then we need new laws to apply to private sector contracting. 

Maybe someone here could enlighten us on the legal disclosure requirements of home contractors etc? 

The bill under consideration  was one that only applied to public sector contracts.

Obviously, it was "fishy" enough that it had to be withdrawn for this lame duck anyway.  lol

I wonder if they'll have the chutzpah to raise it in the same form next year?

Let us be vigilant! 

---

by: Nick Lento @ Mon Dec 17, 2007 at 19:32:59 PM UTC

[ Parent ]

Let's Go To The Audio "Tape"... (0.00 / 0)

Thanks to PocketAces for the link to the hearings.  For reasons beyond my ken it wasn't possible for me to fast forward through to the last part where this bill was actually discussed, so I am now more educated on the intricacies of voter verified balloting than I was before (so look out, I just may blog that one too!  lol).

To spare anyone else who might be interested in actually hearing more about this (now seemingly withdrawn) bill; I've separated it from the rest of the hearing and posted it here for your listening pleasure.

My sense is that this isn't going away and that it will be introduced in what  might be a more palatable form.  We'll have to stay vigilant.

I was a bit concerned when I was told that Weinberg voted yes; but when you hear her it's clear that she has many reservations and it was her idea to vote it out without a recommendation; I strongly doubt she would have voted for it (on the floor) as written.  Sometimes the sausage making process ain't pretty.

My own initial gut instincts in re this bill have only been reinforced as I find out more about it.  Thanks to those who have prodded me to take a closer look!

Meanwhile, if you want to actually get a good sense of what the points pro and con are here's the discussion.

http://blip.tv/file/...

---

by: Nick Lento @ Sat Dec 15, 2007 at 06:01:56 AM UTC

Important Update: Read it And Celebrate!!! (0.00 / 0)

 

When I first read out this issue on the 12th, I googled the bill number and came up with nothing much.

I mistakenly assumed that there was nothing written about in the media.

I was wrong.   I wish someone else had uncovered the information I'm about to share with you long before today.  

It seems that there's lot's of "erroneousness" to go around!  Eh? 

Here's an excellent column by the Record's  Charles Stile on the topic at hand.

I'm very pleased to say that Mr Stile is in agreement with the essence of my perspective on this matter.

Stile: Lame-duck giveaways costly
 
Thursday, December 6, 2007

By CHARLES STILE
RECORD COLUMNIST

Homeowners, beware.

The Legislature is busy at work on the Politically Connected Contractors Protection Act of 2007, and I think it's safe to say that the goal of lowering property tax bills is not a priority.

There's even a chance it might cause bills to rise.

Technically, there is no measure with that title, but I think it's an accurate description of some bills moving at warp speed through the "lame duck" session, the post-campaign period when lobbyists stampede the State House with their wish lists of special-interest legislation.

Lame duck is the low-risk window of the legislative cycle, a time when lawmakers who are either retiring or who lost reelection can vote without fear of voter backlash -- and without a conscience. This year, 27 lawmakers are leaving before the new session begins Jan. 8.

There is a crude, unspoken expectation from special-interest groups that fuels the lame-duck frenzy, which can be summed up this way: "We cut the checks when help was needed, including a record $69 million in campaign contributions this year. Now we need your help."

So, I plead guilty to having rushed off a diary after a few minutes of inadequate research.

However, I dare say that most decent progressives would agree with me that this bill was and is, a dog.

And here's an editorial re this bill that appeared in the Record on December 7th

  Santa's little helper - Editorial
Friday, December 7, 2007
THE RECORD EDITORIAL

BEFORE he leaves the state Senate under a cloud, Sen. Joseph Coniglio, D-Paramus, wants to play Santa one last time.

He wants to fill the stockings of highway and building contractors with a special gift: the freedom to increase prices after municipalities and counties accept their bids.

What a heartwarming story. Contractors are among the most generous donors to political campaigns. Here's a way to reward their generosity -- in keeping with the spirit of the season. Pushing it through in the Legislature's so-called lame duck session almost guarantees that it will be largely unnoticed -- until it's too late.

The New Jersey League of Municipalities opposes the giveaway, as do many local officials. They say it would increase property taxes because contractors, in the midst of construction, would be allowed to add on costs that towns would have no choice but to pay. Is anyone in Trenton listening to these local officials? The word is this bill will be easily approved........  (emphasis mine).

The Record's Call To Action...

...........If the members of the Assembly and Senate who swear they want to lower property taxes are sincere, they will defeat this bill.

As we now know, the roaches scurried away once the lights were turned on.   

No doubt an "new and improve" version will re-emerge in some fashion.  

We (all of us) really do have to be much more vigilant; hell, at least we have to read the local papers in full every day!

 

 

 

 

 

---

by: Nick Lento @ Mon Dec 17, 2007 at 20:10:39 PM UTC

Having read Stile's excellent column earlier, I just thought that is what got your keyboard moving. (0.00 / 0)

Another problem with the bill is that there is a mechanism to address increases in cost, but decreases in cost are only going to be addressed if the contractor calls the municipality which is not very likely.  :-)

This is just a very bad bill and I was surprised that Weinberg voted to release it from committee.  After all, since Conilgio, Scutari and Asselta voted yes (giving it three votes to report the bill), why did she bother to vote yes as well???

---

by: Creed Pogue @ Mon Dec 17, 2007 at 20:32:30 PM UTC

[ Parent ]

Nice to have your agreement. I'm pleased to see you've been persuaded To publicly admit that the bill was/is a Dog! Better late than never, eh? n/t (1.00 / 1)

---

by: Nick Lento @ Mon Dec 17, 2007 at 20:48:55 PM UTC

[ Parent ]

If you can move beyond the self-congratulation, you might remember that I was the first commenter and supported your stand on the bill. n/t (0.00 / 0)

---

by: Creed Pogue @ Mon Dec 17, 2007 at 21:26:59 PM UTC

[ Parent ]

If You Want To Know Why Weinberg... (0.00 / 0)

....voted as she did.  You'll have to slog through the audio like I did. 

It's clear, from my hearing of the hearing, that she didn't really support the measure and that her vote was a tactical one.  (After all, look at what ended up happening, eh? ;-)

It was Loretta that made the motion NOT to recommend the bill.

Why am I not surprised that, one again, you're trying to drag this wonderful woman through the mud, Creed.

What's your problem with Loretta Weinberg's agenda, Mr Pogue?

Or are we in total agreement that she deserves the enthusiastic support of every progressive in New Jersey? 

 

---

by: Nick Lento @ Mon Dec 17, 2007 at 20:56:58 PM UTC

[ Parent ]

hold on a minute (4.00 / 2)

You oppose the legislation and slammed someone for voting for it in committee, but defend someone else for doing the same. It's not at all unreasonable to ask why that is.

---

by: Juan Melli @ Mon Dec 17, 2007 at 21:05:13 PM UTC

[ Parent ]

Tactical??? (0.00 / 0)

How is it tactical to vote for a bill that had three other votes and was being reported???  Unless you wanted to have it both ways and say to the contractors and building trades that you supported the bill, but be able to tell others that you didn't give it a recommendation???

You wind up putting yourself into some serious contortions.  Trust your interpretation of the law regarding Bergen Grassroots, but disregard U.S. Supreme Court precedent.  Trust the "experts" who say that the Party Democracy Act will survive constitutional muster, but don't trust the experts who say that vaccines for children DON'T have mercury in them.  Attack Coniglio for introducing the bill, but Weinberg deserves a pass for voting to report the bill out of committee.  If you weren't so sanctimonious about everything, it might be more pardonable.

---

by: Creed Pogue @ Mon Dec 17, 2007 at 21:34:48 PM UTC

[ Parent ]