Despite lower residential construction permits in 2016, Connecticut builders are on track to increase their ranks at the fastest pace of any industry over the next few years, with continued low interest rates combining with stock market gains to unleash pent-up demand for home improvements and upgrades to commercial facilities.
A recent surge in hiring has helped fill in an employment chasm that developed over six years following the 2008 collapse in the housing market. Over that stretch, only the manufacturing and finance sectors terminated more jobs in Connecticut than construction, with the sector’s employment down by more than 10,000 jobs as noted in a state Department of Labor report, despite major residential developments in downtown Stamford, Norwalk and the Danbury area.
Between the summers of 2014 and 2016, however, construction staged the biggest employment rally in Connecticut, the Labor Department noted, with builders bringing on nearly 4,500 people. And many projects were able to get an early jump heading into 2017 thanks to unseasonably mild weather throughout much of the winter.
Behind only a “mining” category in Connecticut that relates largely to gravel and sand quarries operated by companies like Tilcon — resources directly hitched to construction — the Labor Department believes builders will lead the state in hiring through 2018, bolstering their combined workforces by 2.5 percent against a 0.8 percent increase in overall employment.On the Indeed job board heading into the 2017 summer building season, Connecticut employers list 1,600 full-time construction jobs, nearly 60 percent of them entry level.
Driving that hiring is a significant increase in lending in the past year for commercial construction, according to loan figures banks provide the Federal Deposit Insurance Corp. Of local banks that focus the large majority of their lending power on southwestern Connecticut communities, loans for new residential construction were off slightly in 2016, but loans for larger projects put an extra $141 million into the construction pipeline for a 26 percent overall increase.
And those figures do not include the impact of home equity loans used to finance major projects, as well as an emerging category of “purchase and renovate” loans that have become increasingly attractive by helping people spread the cost of needed improvements in homes they purchase over the lifetime of a mortgage.Due largely to a hiatus of new permits for apartment construction in Stamford and Danbury, southwestern Connecticut permits were down by half in 2016 from the year before. In the first two months of 2017, the region’s towns had recorded permits roughly in line with the start of 2016.
In a March meeting in Norwalk of the Home Builders and Remodelers Association of Fairfield County, attendees pressed for the city and others to ease the stringency of the processes that govern permitting and zoning, arguing they are hurting more than helping by hampering projects from the get-go. Anthony DeRosa, who owns Greenwich-based DeRosa Builders and who is HBRA’s senior vice president, said he would like to see standardized permitting across towns.
In Hartford, the Connecticut General Assembly is again considering legislation that would raise so-called “prevailing wage” thresholds in Connecticut that set a pay floor for companies bidding for municipal work, with the goal of lessening costs for towns and cities hiring contractors. Paul Dinto is among the local builders who fear the rules could cause their bids to be undercut by rivals elsewhere who pay their employees less, with his Paul Dinto Electrical Contractors business in Danbury employing 200 people. CLICK TITLE TO CONTINUE
Bethel to hold groundbreaking on police station project
BETHEL — Officials will celebrate the beginning of construction of the police station at a groundbreaking ceremony at 6 p.m. Wednesday.
Once completed, the 26,000 square foot, two-story station on Judd Avenue will be double the size of the existing building on Plumtrees Road.
The project has been in the works for years, with voters rejecting a $14.1 million project in 2014, but approving a $13.5 million revision in 2015. After the ceremony, site work will begin on May 15.
Crumbling roads, bridges mean higher taxes, fees in many states
For the first time in nearly 30 years, Tennessee will soon tax motorists more to fill their tanks. So will California, Indiana and Montana.
Lawmakers across the U.S. have approved new proposals this year to pay for transportation improvements, including tax hikes, vehicle fee increases and bond packages. Those measures extended an existing trend to a new milestone: Two-thirds of all states have stepped up highway funding over the past five years.
It's happening in both Democratic- and Republican-led states as their transportation departments strain to overcome backlogs deepened by the last recession. And lawmakers are acting regardless of promises from President Donald Trump for a $1 trillion national infrastructure program that his administration has yet to detail.
Some state officials doubt that Trump's plan will make much of a difference when it comes to repairing and replacing thousands of old bridges or repaving and widening countless miles of congested roads.
"We really don't know what's in it. We haven't seen anything," said Tennessee state Rep. Eddie Smith, a Republican from Knoxville. But "it sounded like there wasn't going to be a lot that we would directly benefit from."
Trump has said his plan will depend partly on spurring private investment in infrastructure. That could include tax incentives for those who subsidize big-ticket projects, with an expectation that investors could recoup costs through tolls or fares on roads, bridges, rail systems or airports. Tennessee currently uses neither tolls nor bonds for its highway system.
In Connecticut, Democratic Gov. Dannel Malloy signed a law in 2015 authorizing $2.8 billion in bonds to be combined with existing money under a $10 billion, five-year transportation plan. The bonds are to be repaid partly by diverting one-half cent of Connecticut's existing general sales tax to a transportation fund. Malloy promoted the law as a first step in a 30-year, $100 billion transportation initiative, but there is no funding in place yet for that longer-term plan.
At least two dozen states adopted higher fuel or sales taxes to pay for transportation improvements.
"That's highly unusual for that many states to be in agreement about raising taxes, and these are oftentimes fairly conservative states as well," said Carl Davis, research director at the Institute on Taxation and Economic Policy, a Washington-based nonprofit think tank.
The U.S. has an $836 billion backlog of needed repairs and improvements to roads and bridges, plus an additional $90 billion backlog for public transit systems, according to the Federal Highway Administration.
Those needs have grown as the money available from the Federal Highway Trust Fund for states fell by more than 9 percent from 2010 to 2015, according to an Associated Press analysis of the most recent figures from the highway administration.
A 2015 federal law increases Highway Trust Fund money for states by $20 billion over five years through traditional matching funds and new competitive grants. But some financial analysts project that will merely hold funding flat when accounting for inflation.
States are "bellying up to the bar and actually increasing their own gas taxes to make up for the lack of an increase of federal spending," said Julius Vizner, an assistant vice president at Moody's Investors Service.
Republican-led South Carolina, which has long resisted tax increases, is among those seriously considering a gas tax hike this year. Separate tax proposals have passed the House and Senate, even though Republican Gov. Henry McMaster has threatened a veto and wrote a letter to Trump in February asking for $5 billion in federal funding for infrastructure.
South Carolina House Majority Leader Gary Simrill said the federal money would be welcome but doesn't provide a long-term solution. The state's Department of Transportation wants an additional $1.1 billion annually over the next 25 years to improve roads.
"People who are waiting on the federal government usually just get old and tired," said Simrill, a Republican who has led the House's road-funding efforts for several years. "South Carolina cannot wait on the federal government to take care of our problem."
The federal gasoline tax has remained at 18.3 cents a gallon since 1993, breaking a record this spring for its longest gap between increases. The last record was set when the tax remained at 4 cents from October 1959 through March 1983.
Trump rolls out red carpet for some unions more than others
WASHINGTON >> President Donald Trump says labor unions have an open door to his White House, but so far, he’s holding the door a little more ajar for some organizations than others.
Trump has put out the welcome mat for the nation’s construction trades, with whom he’s had relationships during decades of building office towers and hotels. Also invited in have been auto, steel and coal workers who backed him during the 2016 election.But there’s been no White House invitation for other unions representing the sprawling but shrinking pool of 14.6 million workers who collectively bargain with employers in the labor movement. “You can tell Congress that America’s building trades and its president are very much united,” Trump told North America’s Building Trade Unions, even as he pledged in the same speech, “America’s labor leaders will always find an open door with Donald Trump.”
But he has not courted all union leaders or advocated for all labor priorities. For example, he’s against a $15-an-hour minimum wage and has let linger a rule expanding overtime pay. Much like President Ronald Reagan did, Trump is not so much pursuing a labor agenda but one that appeals to those who share his “Buy American, Hire American” priorities and happen to be union members.