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Industry still waiting for stimulus boost

By Sean Ryan

Contractors and engineers disappointed by the amount of federal stimulus work in 2009 might see more opportunities in 2010.

Different sectors of the construction industry differ in their responses to whether the American Recovery and Reinvestment Act reached its goal of growing private companies in 2009.

Richard Smith, president of R.A. Smith National Inc., Brookfield, said the federal money helped offset the pain engineers felt from a drop-off in the private market. But the stimulus money has not been the boon everyone anticipated, he said.

“We’re still doing some,” Smith said, “but nowhere near the value of work from three years ago.”
R.A Smith was one of the sponsors of a Wednesday discussion on stimulus spending organized by the Public Policy Forum of Wisconsin.

Smith said he expects the stimulus money to increase the demand for engineering work in early 2010. The federal stimulus act required bid releases for shovel-ready projects that did not need much engineering work, he said.

But municipalities have exhausted their supply of those projects, Smith said, and will call on engineers to design new street and utility projects for which local governments can apply for stimulus money.

“It’s a very difficult situation,” he said. “How do you get out of this chasing your tail, where everything is just kind of in a limbo or a very stagnant state right now?

“Communities are afraid to spend money.”

The stimulus money for green-energy projects also is just starting to hit the streets, said Mark Wagner, vice president of government relations for Johnson Controls Inc., Milwaukee. The company received a $299 million stimulus grant to build a new battery manufacturing plant in Holland, Mich., he said.

Beyond that, though, the contracts to renovate government buildings with more efficient heating and ventilation systems are just now becoming available, he said. Johnson Controls is pursuing 75 projects in Wisconsin alone, Wagner said, but major construction work won’t begin until midway through 2010.

“We’re just seeing kind of the tip of the iceberg now,” he said.

Road builders have seen a good portion of their share of the stimulus money hit the streets, said Pat Goss, executive director of the Wisconsin Transportation Builders Association. But most of the stimulus projects that ramped up after the spring bid lettings are on hold until spring, he said.

Smith and Goss said builders, more than anything, need more private developments to pave the way to a healthier 2010.

“We hope,” Smith said. “We’re very hopeful. We’re looking forward to the new decade, that’s for sure.”

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