Stimulus or Not, Public Construction is Up

Of late there have been a number of stories bemoaning the delay in getting stimulus funds to work in the regional markets. Some of this criticism is probably valid, and much is tied to the fact that the money was to be flowing through state coffers, and many states are like PA right now: frozen in budget battles. The reality is that no matter the direct impact of ARRA funding today, the spending of public money on construction has skyrocketed compared to recent years in western PA.

Within the past few weeks alone, big contracts were let for school construction in Bethel Park ($60 million, with Mascaro low on the general) and Upper St. Clair ($20 million plus each to Gurtner and Mucci). The state’s prison expansion program is in full bloom. Letters of intent were issued on 3 of the smaller expansions. The SCI Pine Grove job went to G. M. McCrossin, Cambridge Springs went to PJ Dick and Wohlsen got the Coal Twp. job in Northumberland Co. Each went for between $11-12 million. The proposals have apparently been rejected on $200 million Rockview expansion (which will re-bid) and the $400 million Graterford job is now out.

Federal spending is up significantly in the broader region as well. More than $25 million is getting underway or is out to bid at VA hospitals in Pittsburgh, Butler or Altoona. In northern WV, another $100 million expansion of the federal prison in Hazeltine has just bid; the $65 million Camp Dawson Interagency Training Center is out to bid in Kingwood; the first phase of a $170 million FBI research center in Clarksburg bids in early October, when the bid packages for a $45 million IRS computer center in Kearneysville are to be out.

In the infrastructure sector, PA will have contracted roughly double the annual highway budget by Labor Day, including a $100 million plus Turnpike section that Jos. B. Fay is doing between Hampton and Cranberry, plus a couple of $25 million bridge jobs that will be done by Trumbull and Swank.

With commercial market declining and financing still tight, government spending for construction was to be the bright spot of the market in 2009 and 2010. Media complaints about stimulus aren’t reflecting the public market here at least.

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