For all you California Prevailing Wage contractors out there, we just received this alert from the AGC, regarding the implications of California’s ongoing budget crisis for contractors working on public works projects. If you’re doing a prevailing wage project here in California, then this is something you definitely need to be on top of! More importantly, if you’re project is being affected by payment delays, and you’re wondering how this might affect your prevailing wage employee benefit payments, do NOT hesitate – contact Kimberley now!

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AGC – STATE BUDGET ALERT

August 12, 2010

As the State’s budget stalemate continues, ALL contractors working on public works projects MUST contact the public agency contracting the work and confirm payment status for the project.

The state budget situation continues to worsen.  Contractors may once again be faced with the potential slow down in progress payments, delayed projects and delayed project awards due to the budget impasse.

Caltrans’ top officials held a session yesterday with AGC and others to alert contractors of what to expect if the budget stalemate continues into September.  Caltrans reported that without a state budget, the following actions will be taken:

·        Delay $1.3 billion in project awards.

·        Delay over $900 million of projects that were allocated with prior year budget funds.

·        Delay nearly $650 million of Proposition 1B bond funded projects until the Treasurer’s office can complete the bond sale, which will not happen until a state budget is passed.

For details on Caltrans actions, including a partial list of projects affected, please read the memorandum from Caltrans Director Cindy McKim to the Business, Transportation, and Housing Agency Secretary Dale Bonner.

This budget impasse affects all contractors performing public works construction projects with state agencies:

·        If the work done in 2009-10 or attributable to 2009-10 budget, the State Controller’s Office should pay progress payments if the contracting department files a claim for payment.

·        If the work is clearly from a continuous appropriation that is still effective (alive) under a late budget, the department should file a claim schedule showing such an appropriation.  That would be the authority to pay.  (The State Highway Account should be a continuous appropriation to Caltrans.)

·        For work done in 2010-11 (after June 30, 2010) and is not from a live continuous appropriation, the State Controller’s Office does not have the authority to pay.  If work is done in 2010-11 on capital projects that were “contracted” in a prior year and properly encumbered, contractors will still be paid (even if it was not a continuous appropriation).

What should you do?

If you have a state contract for a project currently under construction, immediately contact the responsible state agency to check on the status of progress payments in the event of a continued delay in the state budget.

If you have a contract with a local agency, make immediate contact with your contracting agency.  Some local agencies may depend upon subventions from the state to fund local construction and may not be able to make progress payments if subventions to them are delayed.

If you are having difficulty determining if you may be impacted, please contact : Brad Barnum, AGC’s Vice President Government Relations, at 858-731-8158.

 

nbsp;Caltrans reported that without a state budget, the following actions will be taken: