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Real Estate & Construction News Roundup (06/28/23) – Combating Homelessness, U.S. Public Transportation Costs and the Future of Commercial Real Estate

August 07, 2023 — Pillsbury's Construction & Real Estate Law Team - Gravel2Gavel Construction & Real Estate Law Blog
In our latest roundup, we examine the Supreme Court’s ruling regarding water supply responsibilities, the federal reserve chair’s reaction to possible banking losses, several analyses of the future of commercial real estate, and more!

• California Representative Maxine Waters has introduced several pieces of legislation aimed at combating homelessness and fixing the increasingly tumultuous affordable housing situation. (Eliza Relman, Business Insider)
• The Supreme Court ruled in favor of the federal government in a case that decided responsibility over water supply as well as the overall dissemination of water usage for the Navajo Nation. (Ariane de Vogue, CNN)
• Unlike other nations with similar construction, the United States’ public transportation has extremely high costs. (Darian Woods, Corey Bridges, Viet Le, NPR)

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Reprinted courtesy of Pillsbury's Construction & Real Estate Law Team

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Requesting an Allocation Between Covered and Non-Covered Damages? [Do] Think Twice, It’s [Not Always] All Right.

October 12, 2020 — Todd Likman - Colorado Construction Litigation
As is often the case in construction defect and other insurance defense litigation, a plaintiff’s claims for relief typically encompass both covered and uncovered damages. Obviously, it is in the insured’s best interests to have as many damages covered by insurance as possible. From the insurer’s perspective and against the backdrop of owing duty of good faith and fair dealing to its insureds, however, it is generally better to have an allocation of covered vs. non-covered damages. This places the insurer, insured, and insurance retained defense counsel in a difficult position. A recent opinion from U.S. District Court for the District of Colorado, Rockhill Ins. Co. v. CFI-Global Fisheries Mgmt, Civil Action No. 1:16-CV-02760-RM-MJW, 2020 U.S. Dist. LEXIS 35209 (D. Colo. Mar. 2, 2020), sheds light on the issue, even though some may feel it only further muddies already murky waters. Rockhill involved review of an arbitration proceeding that property-owner, Heirloom I, LLC (“Heirloom”) filed against CFI-Global Fisheries Management (“CFI”). Rockhill Insurance Company (“Rockhill Insurance”) was asked to defend the arbitration as CFI’s professional and general liability insurer. At issue in the arbitration was Heirloom’s claim that CFI defectively designed and constructed a fisheries enhancement that was destroyed by natural processes four times in three years. Read the court decision
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Reprinted courtesy of Todd Likman, Higgins, Hopkins, McLain & Roswell
Mr. Likman may be contacted at likman@hhmrlaw.com

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Contractors Board May Discipline Over Workers’ Comp Reporting

November 06, 2013 — CDJ STAFF
California recently passed AB 1794, which authorized the Employment Development Department to share information it received on new hires with other agencies. The bill also allows the Contractors State License Board to audit members based on this information to determine if contractors are engaging in workers’ compensation fraud. Writing on the Cumming & White construction litigation blog, Iman Reza notes that “the new law is intended to deter contractors from cutting corners in underreporting employees.” The CSLB will be able to discipline contractors who seek to gain an illegitimate competitive advantage by circumventing the law. Read the court decision
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Call to Conserve Power Raises Questions About Texas Grid Reliability

July 05, 2021 — Autumn Cafiero Giusti - Engineering News-Record
With the days getting hotter and tropical activity picking up in the Gulf of Mexico, concerns are mounting about the reliability of the Texas power supply after the state’s main grid operator asked residents to go on a five-day energy conservation diet. Reprinted courtesy of Autumn Cafiero Giusti, Engineering News-Record ENR may be contacted at ENR.com@bnpmedia.com Read the full story... Read the court decision
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WSDOT Excludes Non-Minority Women-Owned DBEs from Participation Goals

June 15, 2017 — Ellie Perka - Ahlers & Cressman PLLC
A drastic change has been implemented by the Washington State Department of Transportation (“WSDOT”) to the Disadvantaged Business Enterprise (“DBE”) Program in Washington. Effective June 1, 2017, WSDOT has implemented a “waiver” to exclude women-owned DBEs[i] from qualifying toward Condition of Award (“COA”) Goals on federally-funded projects. This move is significant. It will likely result in long-lasting detrimental impacts on the DBE community, women-owned businesses, and the entire construction community in Washington. The construction industry should be in an uproar over this change. Instead, it has largely gone unnoticed (likely because its impacts have not yet been felt). It is a de facto exclusion of women-owned businesses from the DBE program, and the severity of this change cannot be overstated. Under the waiver, women-owned businesses no longer satisfy COA Goals on federally-funded projects (i.e., projects receiving funding from the Federal Highway Administration) advertised after June 1, 2017. Existing contracts are not impacted and may continue to utilize women-owned DBEs to satisfy COA Goals until the project is complete. The waiver is not retroactive. Read the court decision
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Reprinted courtesy of Ellie Perka, Ahlers & Cressman PLLC
Ms. Perka may be contacted at eperka@ac-lawyers.com

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Real Estate & Construction News Roundup (3/20/24) – Construction Backlog Falls, National Association of Realtors Settle Litigation, and Commercial Real Estate Market’s Effect on City Cuts

April 15, 2024 — Pillsbury's Construction & Real Estate Law Team - Gravel2Gavel Construction & Real Estate Law Blog
In our latest roundup, bad loans outweigh loss reserves at top six U.S. banks, the FCC announces a proposed rule aimed at “bulk billing,” office-to-multifamily conversion projects grow in major metro cities, and more!

• The National Association of Realtors has agreed to settle litigation that accused them of artificially inflating real estate commissions – a major decision that could reshape the housing market for buyers, sellers and agents. (Rachel Siegel, The Washington Post)
• An NYU professor considers the positives and negatives of cities cutting services or raising other kinds of taxes to offset the continued faltering of the commercial real estate market. (Alan Rappeport, The New York Times)
• Construction backlog fell in February for every size of contractor except for those with under $30 million in annual revenue, while, over the past year, the largest contractors – those with greater than $50 million in revenue – have experienced the greatest decline in backlog. (Sebastian Obando, Construction Dive).

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Reprinted courtesy of Pillsbury's Construction & Real Estate Law Team

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Depreciating Labor Costs May be Factor in Actual Cash Value

April 20, 2016 — Tred R. Eyerly – Insurance Law Hawaii
The Minnesota Supreme Court considered a certified question from the the U.S. District Court regarding consideration of depreciating labor costs in determining the actual cash value of a loss. Wilcox v. State Farm Fire & Cas. Co., 2016 Min. LEXIS 50 (Minn. Feb. 10, 2016). The insureds' home was damaged by hail. State Farm provided a written estimate that calculated the actual cash value of the loss. To estimate the actual cash value of the damaged property, State Farm first calculated the replacement costs of individual items, such as roof flashing, siding, fascia, gutters, and window screens. Next, State Farm subtracted the pre-loss depreciation of some, but not all, individual items. For example, State Farm depreciated the cost of removing and replacing certain materials, such as siding. State Farm did not depreciate the cost of the new siding separately from the cost of the labor required to install the new siding on the home. Instead, State Farm calculated the removal and replacement of the siding as a single cost, then depreciated the removal-and-replacement cost as a whole. The cost of labor to repair or replace the damaged property was referred to by the court as "embedded labor costs." Read the court decision
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Reprinted courtesy of Tred R. Eyerly, Insurance Law Hawaii
Mr. Eyerly may be contacted at te@hawaiilawyer.com

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Winter COVID-19 Relief Bill: Overview of Key Provisions

January 04, 2021 — White and Williams LLP
In a much needed holiday gift for businesses and individuals who continue to be affected by COVID-19, Congress finally approved a $900 billion aid package follow-up to the CARES Act (the Winter Covid-19 Relief Bill), the several trillion dollar stimulus that was enacted early in the pandemic. The bill, part of the larger annual spending bill, will hopefully be signed into law by President Trump in the coming days although the President has indicated his disappointment about the small amount of direct relief to individuals included in the bill. The bill was passed by both houses of Congress by a veto proof majority and is expected to become law whether or not the President chooses to exercise his veto power. White and Williams has and will continue to provide more detailed updates on important components of the legislation, some of which address matters beyond COVID-19-related relief and support, including a new Paycheck Protection Program and tax deductibility of expenses paid for with PPP funds, extension and expansion of the employee retention tax credit, direct payments to individuals, additional unemployment assistance, restrictions on surprise medical billing, rental assistance and extension of the eviction moratorium, education funding, vaccine distribution, testing and tracing, and other healthcare funding. In the meantime, here is a brief overview of several pieces of the legislation: Paycheck Protection Program The Winter COVID-19 Relief Bill provides for $284 billion of funding for a new round of the popular Paycheck Protection Program (PPP), which was established by the CARES Act and allowed borrowers to receive forgivable loans to be used to retain employees and cover certain other basic operating expenses. New and existing businesses may participate in the program. However, eligibility for PPP Part II is more restrictive and targeted then the original PPP. Read the court decision
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Reprinted courtesy of White and Williams LLP

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