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Accountant Joe Molloy has eight brothers and sisters, and he prepares taxes for all of them. It’s not as much work as it sounds, he says. He need not apply the full arsenal of tax rules and loopholes to his siblings’ tax returns because none of them operates complex business enterprises. This is not the case for clients at his day job. Molloy is the Principal of Construction Taxation at Grassi & Co., a New York City accounting firm . He oversees the preparation and review of tax returns for Grassi’s construction industry clients. Molloy jokes that he only talks to his siblings during tax season. But if you are one of his construction contracting ...
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Owners and subcontractors take note: Private construction project owners are not required to provide copies of payment bonds to potential claimants, although some standardized contract agreements include the right of subcontractors to request copies. Most public owners, however, have obligations to provide such bonds upon request.  Indeed, the Federal Acquisition Regulations (FAR) provide authority for subcontractors and suppliers AND prospective subcontractors and suppliers on federal projects to request and obtain copies of payment bonds from the contracting officer. FAR 28.106.6(d) provides as follows:  Upon the written or oral request of a subcontractor/supplier, ...
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This year at the 2019 NASBP Annual Meeting, attendees who have the earned the Associate in Fidelity and Surety Bonding (AFSB®) and Chartered Property Casualty Underwriter (CPCU®) designations will be able to display a sticker on their name badge, indicating that they have obtained these prestigious designations. These designations, typically obtained by surety professionals, are professional credential programs that help an individual increase his or her knowledge of risk management, surety, and insurance and demonstrate to clients, employers, and colleagues that they have obtained that expertise. The Institutes’ offers these as well as entry-level certificate ...
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Surety bonds guarantee capital, of course; but they also bring with them the expertise of the surety and reputational benefits to the contractors and construction projects that use them. But contractors who benefit from surety bonds should keep in mind they are subject to indemnity agreements that will bite if they fail to fulfill their end of the contract by failing to pay bond premiums and subcontractors or by not completing the project. By entering into a general agreement of indemnity, contractors are placing their cash and real and personal property at risk in the event of a bond default—and even that of their spouse, children, other relatives or business ...
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The end of winter marks the beginning of the push for some known scam techniques, but there are also some new ones on the scene. Scammers are targeting organizations large and small, as well as individuals, attempting to steal money and/or information. Below are some of the more common scams that are being reported around the world. At the time of year when W-2's are being issued to employees, a common scam method is to impersonate the CEO or other executive leader, requesting documentation on all employees to compare records. The targeted individuals at organizations would be staff level members associated with the HR and finance departments. The request often ...
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Today’s technology is disrupting the world’s oldest industry, construction, according to James Benham, CEO of JBKnowledge, Inc., a construction and insurance technology solutions company based in Bryan, Texas. For Benham, technology is a means, and the end is improved construction productivity. Benham is adamant that, because construction is a low-margin, low-productivity business and its productivity is lagging behind other industries, the construction industry must embrace technology now. What do construction firms have to fear if they don’t get on the technology bandwagon? According to Benham, they risk being left out of a phenomenon that some call ...
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​ This is the third blog in a three-part series on how NASBP bond producers are uniquely situated to ensure success and growth for small contractors.   NASBP bond producers are uniquely qualified to help small contractors learn about financial management and to increase the level of financial literacy in their communities.   NASBP members typically seek to develop expertise in construction financial management and use that expertise to become effective business advisors as a means to differentiate themselves from the general population of agents who can provide surety bonds for contractors. Pictured here is Joshua Etemadi ...
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Jeanne Harrison, an associate with the Atlanta office of the construction law firm Smith Currie, has a message for the construction industry: Don’t underestimate the coming wave of respirable crystalline silica lawsuits. Harrison, pictured, believes exposure to crystalline silica, the characteristic dust generated by drilling stone and brick, will be the source of innumerable lawsuits by victims of silicosis, a lung disease caused by breathing in silica. Harrison explains the ins and outs of silica regulations to construction industry owner-operators. She predicts that silica-related silicosis claims will be her generation’s version of the asbestos-spawned ...
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According to W. Barron A. Avery and William "Liam" B. O'Reilly, "Contractors cannot always trust that government contracting officials have used the correct forms, or cited the correct clauses, when soliciting goods and services. As a consequence, contractors should maintain constant vigilance for potential government errors or omissions in solicitations that could impact contractors’ ability to perform. Failure to do so could result in substantial unexpected costs down the road, rendering contracts difficult – or even impossible – to perform." Read Barron’s and Liam’s alert published by BakerHostetler LLP and titled “FAR Clauses Are in the Contract Whether ...
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As of November 5, 2018, the population of the United States was more than 328 million, based on projections from the U.S. Census Bureau. And there’s no sign that growth will stop anytime soon. After all, when factoring in the various components of population change—births, deaths, and migrations—there’s a net gain of one person every 14 seconds  in our country. As the U.S. population booms, housing supply must keep pace. Faced with increased development, some local governments are requiring subdivision bonds to guarantee contractors meet their performance obligations. “Subdivision bonds generally guarantee public or private work improvements to a city ...
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Read about the impact of the Narula reverse False Claims Act decision on bonding set-aside contracts in the Surety Claims Institute newsletter article by Armen Shahinian of Chiesa Shahinian & Giantomasi PC , who serves on the NASBP Attorney Advisory Council .   Armen Shahinian, Esq. Chiesa Shahinian & Giantomasi PC One Boland Drive West Orange, NJ 07052 973.530.2002 (NYC phone: 212.973.0572) ashahinian@csglaw.c
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The Executive Director of CICPAC , Kathleen J. Baldwin, CPA, CCIFP, has described CICPAC's  “Revenue Recognition Implementation Guide -- Guidance for CPAs and Construction Companies, " for NASBP and its membership. NASBP: When did CICPAC release the Guide? Baldwin: CICPAC released the Guide on March 28, 2018. NASBP: Why did CICPAC create this Guide?   Baldwin: At the time of the Guide’s release, most articles and material published to date focused solely on the definition of the new FASB revenue recognition standard. CICPAC wanted to compile a document focused on the aspects of the new standard that were most pressing to the construction industry. ...
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Teaming agreements are an integral component of government contracting, providing prime contractors and potential subcontractors the ability to team on federal projects in advance of a contract award and make both parties more competitive for award. Attorneys W. Barron A. Avery and William “Liam” B. O’Reilly comment on recent developments in state law that impacts the enforceability of these teaming agreements. Read Barron’s and Liam’s alert published by BakerHostetler LLP and titled “Teaming Agreements Under Fire: Decision Chips Away at the Enforceability of Teaming Agreements.” W. Barron A. Avery, Esq. BakerHostetler LLP wavery@bakerlaw.com ...
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It’s no secret that the U.S. is in desperate need of funding to repair its crumbling roads, bridges, highways, railways, and waterways—and that’s why many Americans waited with bated breath for the White House to release its infrastructure plan in February. When the highly anticipated $1.5T plan was released, however, it set aside only $200B in federal spending for infrastructure repairs, leaving the remaining $1.3T to states, localities, and private investors. One way some government entities may seek to bridge this gap is through the utilization of public-private partnerships, or P3s, as a procurement mechanism. “The federal dollars that many states and ...
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NASBP CEO   Mark McCallum   is quoted (page 9) in the new ConsensusDocs publication, "Standardized Contracts: Streamlining Projects in Today's Fast-Paced Construction Market." To download the new publication, complete the form here: https://consensusdocs.org/FooterSection_About/standardizedcontra
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The U.S. Small Business Administration just announced the first fee decrease in Surety Bond Guarantees in 12 years. The fee decrease will be in effect for guaranteed bonds approved during fiscal year 2019, taking effect October 1, 2018 and ending September 30, 2019. The Surety Bond Guarantee (SBG) program is reducing the Surety fee from 26 percent to 20 percent of the bond premium charged to the small businesses and reducing its contractor fee from $7.29 per thousand dollars of the contract amount to $6.00 per thousand dollars of the contract amount. “Reducing the SBG program fees will not only directly help small businesses, but also will incentivize surety ...
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Most construction contracts require that any changes to the work be made formally, in writing, but sometimes things are done verbally. This article explores some practical tips on how to handle verbal change directives when the contract specifies that all changes must be documented by a written change order or change directive. Read Todd’s article published in the Smith Currie 2018 Common Sense Contract Law newsletter, titled “Can’t Get a Written Change Order? Document, Document, Document.” Todd M. Heffner, Esq. Smith Currie & Hancock LLP tmheffner@smithcurrie.com 404.582.814
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The Public Relations Power Bond Producers Gain by Promoting Financial Literacy This is the second in a three-part series on how NASBP bond producers are uniquely situated to ensure success and growth for small contractors. There is a vast and unmet need for better financial literacy education in the United States. According to a February 2015 study by the American Psychological Association, 72 percent of Americans said they feel stressed about money “at least some of the time,” 64 percent said money is a “somewhat” or “very significant” source of stress, and 22 percent said they experienced “extreme stress” about money. Stephen Freeman, Vice President, ...
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An Invaluable Partnership: How NASBP Bond Producers Help Ensure Success and Growth for Small Contractors This is the first in a three-part series on how NASBP bond producers are uniquely situated to ensure success and growth for small contractors. For small contractors looking to build a solid foundation for business growth, a strong understanding of the contract surety bond process is essential.    Though the process of obtaining a bond may be new to a contractor that only performs private work, NASBP bond producers   are uniquely qualified to help entrepreneurs and small business owners understand the bond process and increase their ...
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Why You Should Pursue an AFSB Designation: NASBP Members Weigh In Looking to turbocharge your surety career? The Institutes’ Associate in Fidelity and Surety Bonding (AFSB) designation  may be just the ticket. Launched in 1991 through a strategic alliance between NASBP and the Institutes, the AFSB was designed to help surety professionals better serve their clients through professional education related to risk management and insurance. The Institutes is the leading insurance education provider for the risk management and property-casualty insurance industry. Today, the partnership continues to provide opportunities for surety bond professionals to ...
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