MBA Member Connect Event Q&A April 17, 2020 PRESENTED BY: Dan - PowerPoint PPT Presentation

MBA Member Connect Event Q&A April 17, 2020 PRESENTED BY: Dan McLennon | Smith, Currie & Hancock LLP

Questions for Today 1. I have seen some contractors still working--why is this still happening, with restrictions in place and known safety hazards? 2. What are my options for my suspended, unfinished projects? 3. What financial assistance is available to help keep contractors afloat? 4. Do I lose forgiveness under PPP if I have to lay off people or reduce wages? 5. What rules must essential contractors follow on continuing construction sites? 2 Practical Considerations for Dealing with COVID-19

Questions for Today 5. What best practices are you seeing on projects that continue to operate? 6. What’s next regarding the relationship between the client and the builder? 7. 7. When ar When are we going back to work?!! e we going back to work?!! 3 Practical Considerations for Dealing with COVID-19

First a Little Good News!

CALIFORNIA March 18, 2020 Ominous Projection! “We project that roughly 56 percent of our population—25.5 million people—will be infected with the virus over an eight week period.” 5 Practical Considerations for Dealing with COVID-19

Restrictions are Working! 6 Practical Considerations for Dealing with COVID-19

Why are some contractors still working?

Reasons for Projects to Continue  Essential construction “Some work will be allowed to continue if deemed essential, such as finishing work on a home’s  only bathroom or hooking up electrical or gas connections on a stove to make a kitchen usable. In addition, CDA is allowing the continuation of work and issuing building permits for essential construction projects such as for health care facilities, income-restricted affordable housing, shelters, and temporary housing. Permits may be issued for construction or repair necessary that ensures residences and essential businesses are safe, sanitary, or habitable if the work cannot reasonably be delayed.” Marin Community Development Agency-- https://www.marincounty.org/main/county-press-releases/press-releases/2020/cda-covid- permittingprocess-040320  Scofflaws  Citations starting! 8 Practical Considerations for Dealing with COVID-19

What are my options for my suspended, unfinished projects?

Options for Unfinished Projects  Even if project is not “essential”, make sure it is safe, sanitary, or habitable if the work cannot reasonably be delayed.  Ensure site security  Meet with stakeholders—owner, contractor, key subs and suppliers—to plan minimizing impacts and restart 10 Practical Considerations for Dealing with COVID-19

What financial assistance is available to help keep contractors afloat?

Financial Assistance • Consider also possible tax relief • Enhanced unemployment for workers 12 Practical Considerations for Dealing with COVID-19

Financial Assistance https://www.sba.gov/ page/coronavirus ‐ covid ‐ 19 ‐ small ‐ business ‐ guidance ‐ loan ‐ resources https://www.smithcur rie.com/publications/c ovid ‐ 19/ 13 Practical Considerations for Dealing with COVID-19

Do I lose forgiveness under PPP if I have to lay off people or reduce wages?

PPP Loan Forgiveness https://www.smithcurrie.com/publications/covid ‐ 19/loan ‐ forgiveness ‐ applies ‐ to ‐ february ‐ 15 ‐ 2020 ‐ april ‐ 26 ‐ 2020 ‐ lay ‐ off ‐ rehires/ 15 Practical Considerations for Dealing with COVID-19

What rules must essential contractors follow on continuing construction sites?

Site Safety Rules  Depends on location—No construction-specific in Marin  San Francisco as of April 4: https://www.sfdph.org /dph/alerts/files/Const ruction ‐ Industry ‐ DirectiveOrder ‐ 040220.pdf 17 Practical Considerations for Dealing with COVID-19

Site Safety Rules  OSHA General Duty Clause, Section 5(a)(1): Provide employees with a place of employment “free from recognized hazards that are causing or are likely to cause death or serious physical harm”  https://www.osha.gov/SLTC/covid-19/standards.html  https://www.cdc.gov/coronavirus/2019-ncov/prevent-getting- sick/prevention.html  https://ladbs.org/docs/default-source/publications/misc- publications/construction-site-guidance.pdf 18 Practical Considerations for Dealing with COVID-19

What best practices are you seeing on projects that continue to operate?

Best Practices for Ongoing Projects  Communication and lots of it!  Get stakeholders working together to mitigate impacts  Worker Health Self-certification Forms  Essential Worker Cards https://www.smithcurrie.com/publications/covid-19/essential- work-certification-card/ 20 Practical Considerations for Dealing with COVID-19

What’s next regarding the relationship between the client and the builder?

Future Relationship Issues  Some Owners and Contractors will work cooperatively to mitigate and allocate impacts  Others will suffer claims and litigation over contracts rights and obligations  Obligation to complete the work  Force majeure relief 22 Practical Considerations for Dealing with COVID-19

When are we going back to work?!!

When can we get back to work?!!  Likely May 31 or later, per Gov. Newsom April 14, 2020 24 Practical Considerations for Dealing with COVID-19

When can we get back to work?!! 25 Practical Considerations for Dealing with COVID-19

Thank you for participating!