President Obama’s proposed $3.8-trillion budget for fiscal year 2013 recommends cuts for most major federal construction programs, reflecting continued heavy pressure to hold down overall discretionary spending. But the budget proposal also calls for a sharp boost for surface transportation and a reduction in airport grants for big airports.Obama’s budget request, sent to Congress on Feb. 13, is just the beginning of what surely will be a long, tough, partisan fight over next year’s spending. The final numbers won’t become clear until the fall, or perhaps later.One key construction item in the president’s budget is a proposed six-year, $476-billion surface

The A.M. Best Co. sharply lowered to "weak" from "excellent" First Sealord Surety's credit rating, and the surety's apparent financial troubles have created problems for at least one general contractor with a few subs in default.Big sureties such as Travelers and Liberty Mutual have remained profitable through the economic downturn by sticking to tight underwriting standards. First Sealord, based in Villanova, Pa., serves contractors whose bonded contract value averages $429,000. Surety industry executives predict increasing defaults by small subcontractors in 2012.Sean Murphy, vice president of construction operations for Coastal Construction Group, Miami, says his company has a few subcontractors in

Related Links: Letter from industry groups supporting bill OMB Proposes BRAC-like Board for Buildings CBO Raises Questions About Plan to Shed Excess Federal Real Estate The House of Representatives has approved legislation that aims to reduce the inventory of excess federal properties while redeveloping valuable assets. The House cleared the bill, the Civilian Property Realignment Act, on Feb. 7 by a 259-164 vote. If enacted, the legislation would provide opportunities for the redevelopment of federal buildings. The measure, introduced by Rep. Jeff Denham (R-Calif.), now heads to the Senate. A similar bill has been introduced in the Senate but it

Related Links: Link to House-Senate conference report on FAA bill Labor Provision Deal Unblocks FAA Bill No FAA Bill Yet, Another Extension Likely House and Senate negotiators have reached agreement on a four-year measure authorizing $63.6 billion for Federal Aviation Administration programs, including FAA's Airport Improvement Program (AIP) construction grants. Once the measure is enacted, it would bring an end to more than four years of short-term authorizations for AIP and other FAA programs.News of the House-Senate deal came at a meeting of conferees late in the afternoon of Jan. 31. The final conference report was filed about mid-day on

White House photo by Chuck Kennedy Obama's infrastructure spending proposal would require approval from Congress, which didn't adopt similar plans he proposed last year. Related Links: Blog: Construction reax to SOTU White House transcript of State of the Union speech White House background document on SOTU proposals President Obama's State of the Union address included a further pitch for increased federal infrastructure spending, which he  proposed to finance through savings gained from the military’s pullout from Iraq and pulling back from the Afghanistan war.Obama can take action on some of the many items he discussed in his Jan. 24 speech

Courtesy of Foreign Affairs and International Trade Canada U.S. Trade Rep. Kirk (left) and Canada's International Trade Minister Fast sign an extension of their countries' 2006 lumber trade agreement. Related Links: U.S.-Canada Timber Pricing Dispute Heats Up (2011) U.S-Canada Lumber Pact Goes Into Effect (2006) The U.S. and Canada have agreed to a two-year extension of a 2006 trade pact that governs pricing and export volumes for softwood lumber, a key material in housing construction.The extension, which top trade officials from the two countries signed in Washington, D.C., on Jan. 23, carries the lumber agreement through Oct. 12, 2015, but

After more than four years of short-term funding, a multiyear aviation bill seems to be finally on its way to passage. Senate and House leaders on Jan. 20 resolved a thorny labor issue that had blocked a multiyear authorization for Federal Aviation Administration programs, including its Airport Improvement Program, or AIP, grants, which fund runways and other projects.Those programs have been operating under a long series of stopgap bills since September 2007, when the last long-term FAA law expired. The 22nd extension is slated to lapse on Jan. 31.Some issues remain to be worked out. One item is believed to

Construction groups and other organizations have launched a lobbying drive, aiming to nudge Congress to pass a new multiyear highway and transit bill. They see a window of opportunity—if not necessity—between now and March 31, when the current stopgap authorization runs out.To be sure, industry officials have been campaigning for a new bill for a long time, beginning even before the last major surface transportation measure lapsed in September 2009. But now they are turning up the intensity. They know November's elections will keep the 2012 congressional session short, and if there's little progress toward a long-term transportation bill in

Market Outlook AGC Sees 2012 Funds Up for Education, Down for Highway Construction contractors see a mixed picture for 2012, says a Jan. 23 Associated General Contractors survey of 1,300 members. About 34% of respondents foresee more demand for higher-education-related construction, but 40% say highway funding will fall and 38% say the dollar volume of public-buildings work will decline. Even so, 32% of firms say they plan to add jobs in 2012, and only 9% foresee layoffs. Last year, 37% said they cut payroll. AGC says the number of new positions "are likely to be modest at best." Most firms

Related Links: First Phase of California High-Speed Rail Project Ready to Take Off Engineers Will Finally Be Paid For California High-Speed Rail Work The resignations in January of the California High-Speed Rail Authority's chief executive officer, Roelof van Ark, and its chairman, Thomas Umberg, several months before construction is scheduled to begin the first leg of high-speed-rail construction in the Central Valley, puts the alternative transportation initiative under renewed scrutiny. During Van Ark's 20-month tenure, costs were revised. Estimates more than doubled, to $98.5-billion. That huge dollar amount further erodes public support for the project and undermines its funding.Gov. Jerry