ASA is proud to add more “must have” resources members need to protect themselves against the challenges of escalating pricing, while continuing to lead the way as your industry voice and advocate!
1. Price Escalation and Expanded Force Majeure Contract Language
Lee Brumitt, of Dysart Taylor Cotter McMonigle & Brumitt, PC, produced and supplied a resource for association members that assists with price escalation and expanded force majeure contract language. It is now an accepted reality of construction that certain products and materials specified for a project may be permanently or temporarily unavailable due to shortages of workers or component materials at the manufacturer or in the shipping and distribution channels. A subcontractor has little to no control over the specification and availability of materials and the limited supply of materials and other pressures have caused unabated inflation in the cost. The purpose of the Addendum is to establish a base price for materials and provide a mechanism for the Subcontractor to obtain reimbursement for increases in the price of materials. Please make sure to check it out today and put this valuable tool in your contract arsenal! The verbiage can be found in InfoHub at asaonline.com, under Resources – Contract Tips…or members can contact Tamara for the document.
2. Change Order Reform Legislation Introduced
On July 1, 2022, Rep. Stauber (R-MN), a member of the House Small Business Committee and the Co-Chair of the House Procurement Congressional Caucus, introduced the Small Business Performance Act of 2022, which ASA helped draft and supports. This legislation would amend the Small Business Act to provide interim partial payment to small business contractors that request an equitable adjustment due to a change in the terms of a construction contract. Equitable changes to the contract, more commonly known as change orders, are ubiquitous on construction projects. This bill would require federal agencies to make interim partial payments to their construction prime contractors for unilateral changes in contract performance directed by the buying agencies. As under the existing Prompt Payment Act, a federal prime construction contractor must pay its subcontractors and suppliers within seven days of receipt of payment from the federal agency for work performed on the unilateral change to the prime contractor. Stauber’s Press Release.
3. Gas Tax Holiday
On June 22, 2022, ASA and the Americans for Transportation Mobility (ATM) coalition sent a letter to President Biden opposing any and all efforts to undermine recent and historic infrastructure investments, including suspending federal and state motor fuel user fees, commonly known as “gas taxes.” Per the letter (attached), “American consumers are facing significant economic anxieties brought about by record inflation, continuing supply chain issues, high energy prices, labor shortages, and continued concerns over the COVID-19 pandemic. These stiff economic headwinds demand your Administration’s full attention and prompt action but suspending the gas tax would not have a meaningful impact on addressing these challenges. Doing so, however, would very likely hurt efforts to improve the safety and condition of our roadways, bridges, and transit systems. It would also undermine efforts to create jobs and realize the once-in-a-generation investments in our nation’s infrastructure by the historic and Bipartisan Infrastructure Law.