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Contractors cool to stimulus energy work

By Brian Johnson
Dolan Media Newswires

Minneapolis — Jim Green sees nothing efficient about the paperwork involved in some stimulus-paid weatherization programs.

Green is a vice president with Lumber One, a St. Cloud-area building and remodeling firm.

Lumber One has participated in both the Weatherization Assistance Program, which provides energy upgrades for low-income homes, and Project ReEnergize, which offered rebates to consumers regardless of income who made qualifying energy-related improvements.

In his view, Project ReEnergize — which received enough stimulus money to provide $2.5 million direct-to-consumer rebates — was far more efficient and user-friendly.

“We were thinking we would have had money available sometime even in the summer, but we didn’t get going on weatherization here until essentially Jan. 1,” Green said. “That has been our experience with the process of all the paperwork and the lengthy time of getting through.”

The Tri-County Action Program in Waite Park oversees the St. Cloud-area Weatherization Assistance Program, which didn’t start awarding contracts until December, roughly eight months after the federal stimulus money began rolling into Minnesota.

One problem: The Weatherization Assistance Program, like most stimulus-paid weatherization efforts, involved a request for proposals process to solicit contractors to do the work, and it required interested contractors to wade through a sea of paperwork, with no guarantee that they’d be selected to do any projects.

First, Green recalled, contractors had to fill out a two-page application to get on the “approved contractor list.” Then, toward the end of September, the real paperwork came in: a 117-page application that was part of the “master construction agreement.”

“Once we received an OK to go ahead,” Green said, “they sent out more paperwork that had to be filled out, in the neighborhood of 23 pages.”

Because federal money was involved, contractors were required to pay the prevailing wage, or a rate comparable to similar work in that geographic area.

In all, 27 general contractors applied to participate. Nine were chosen, including Lumber One.

Green said he estimates his company spent 40 to 50 hours on paperwork. In addition, there’s extra bookkeeping to comply with the prevailing wage requirements.

“There were quite a few contractors that definitely said, ‘There is no way in heck (we’ll go through that),” Green said. “That does discourage a lot of people. And it discourages the small guys a little more.”

Green said he doesn’t regret going through the process. He said he expects “probably 100 jobs” from the program. But he was disappointed at the slow pace.

Bjorn Freudenthal, general manager of Lakeville-based College City Remodeling, said small remodeling contractors aren’t used to the kind of paperwork and legal disclaimers that may be common in other industries.

“What you do is impose this large program on mom-and-pop and one-man operations,” forcing them to “weed through a tremendous amount of legal text and paperwork to qualify,” he said. “The results are you are finding people who say, ‘This is overwhelming.’”

Dan Roberts, director of community development for the Tri-County Action Program, said one request for proposals document was more than 100 pages long, but he said contractors had to return only a 16-page questionnaire.

Roberts said the prevailing wage requirements were probably the biggest barrier to fast implementation because the U.S. Department of Labor had to determine the prevailing wage for a weatherization worker.

“When the funding was announced, we thought we would hit the ground running,” Roberts said. “And when we discovered we had to wait for that (wage determination), that delayed things by three or four months.”

After that it went “pretty smoothly,” Roberts said.

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