The days of mud and snow
The costs of January’s icy blast of winter weather on northern Nevada’s red-hot construction industry likely will be felt for months to come.
Contractors, already scrambling to keep up with the region’s heady growth, now have lost as much as a month on some projects.
Assuming that they’d be able to build through the winter months, contractors booked work to start this spring and summer figuring that they’d be wrapped up with their current projects by then.
They may not make it.
But even before then, contractors on industrial, commercial and public works jobs are beginning to tally the costs of the January storms.
To cite just one example: David Knaub, owner and president of K7 Construction Inc., needed to pay a crew of 15 workers for three days to clear snow from the roof of a 50,000-squarefoot building under construction at Greg Street and Spice Island Drive.
Add to that, Knaub says, a multitude of little costs such as parking lot concrete work that was nicked by snow-removal equipment.
Some of the costs are more difficult to see.
“We won’t get reimbursed for things like lower than expected production from workers due to wet, cold, snowy conditions,” says Sheila Hlubucek, a spokesman for Q&D Construction of Sparks.
And she says clients sometimes have difficulty understanding that overhead and project-management costs increase when a completion date is stretched out.
Lost time may be even more critical.
Matt Clafton, vice president and general manager of Panattoni Development, notes that a month-long delay in construction means development companies are on the hook for an additional month without rental income.
If nothing else, Clafton says, tenants prefer to rent a completed building they can see.
“The cost impact of a 90-year storm on a project is not something you factor in,” he says.
So can construction outfits simply crank it up and make up the lost time? Maybe.
“In most winters, Q&D is able to make up lost weather days on building projects with ease,” says Hlubucek.”We typically design a schedule to compensate for up to 10 days of foul weather each winter season.
However, we’ve already had many more days than that.”
A contractor can work additional days perhaps even at overtime rates to make up time lost to weather, but that comes at a cost.
“It all depends on how antsy the owner is to get the job done,” says Pat Kelly, operations manager for Granite Construction Co.
Gauging the antsiness of the owner is a job that falls to the project manager.
“Late delivery of a project is always a customer relations ordeal,” says Hlubucek.”A good project manager will communicate the impacts of weather and hope for an understanding client, but it is never easy.”
The challenges often are greatest, she says, among owners whose projects are just coming out of the ground.
Soils are too soggy for equipment to get in, and trenching and concrete work comes to a standstill.
How about the clients who aren’t understanding? Smart builders give themselves an out for weather delays in the contracts they sign with owners but that’s not a guarantee against lawsuits.
Paul Georgeson, an attorney with McDonald Carano Wilson LLP in Reno, notes that builders and clients sometimes disagree on whether conditions are so bad that work needs to stop.
Another potential legal headache for builders, he says, are contracts in which they promised to begin work on a certain date and now find themselves snarled in a project delayed by heavy snowstorms.
“The weather delay didn’t happen on the new job,” Georgeson says.
Still, Craig Howard of the law firm Hale Lane says he doesn’t expect a flurry of stormrelated litigation involving builders.
“Everyone is stuck together,” he says.
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