MECHANICAL CONTRACTING MCAA working for you


T


he last few years in the mechanical contracting industry haven’t been for the faint of heart, and I say that as someone who loves the business. I was raised in a family-run mechanical contracting business started by my grandfather, and after Villanova and the Navy, I started working my way up


ROBERT T. ARMISTEAD MCAA PRESIDENT


at the firm. We’ve had our fair share of challenges over the years, but these last few have tested our strength and our willingness to adapt in order to succeed. We, like many other MCAA


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member firms, are fortunate that during these difficult times MCAA continued to make available world- class services and educational opportunities that helped us do just that. In addition, MCAA has stepped up its game to make sure that the legislative and regulatory environment allows us to compete on a fair and equitable basis. I appreciate the opportunity from Phc Newsto offer some observations on the future. But first, let me comment on what we did in 2010. In 2010, the economy and


construction markets began to show signs of life and the eventual rebound. However, at MCAA we recognize that our industry will not be what it was before the recession. We believe that the most successful


contractors going forward are those that will continually look at the changes in our industry and stay ahead of that change curve. For example, back in 2005 the


“green” share of new nonresidential construction was only 2% of the U.S. market. In 2010 about a third of new nonresidential building was “green.” Fortunately, a few years ago MCAA began providing our members LEED training, workshops and resources on this market. Energy efficiency and water efficiency are among the most important aspects of green building — and we excel in these areas. In addition MCAA has promoted tax


incentives and sound energy policies in Washington to encourage the growth of these markets. We hope to have continued success with these policies. As we look at the changes taking


place in the construction marketplace we see what our companies must do differently to be more productive and competitive. It is also important that our


labor partners do the same thing. We now have a joint strategic


planning committee, made up of the executive committees of the United Association and the MCAA. We’ve begun to meet on a regular basis and have established a couple of subcommittees. One of them we’re calling the Education Subcommittee. One of the things it’s working on is a presentation on the contractor’s business model, which will be presented at the UA’s training program for new business managers. Following that the presentation will be turned into a curriculum, which will be added to the 5th year of the UA apprenticeship program. We’re calling our other subcommittee


the Competition Subcommittee. Its charge is to address those issues that are inhibiting the competitiveness of union mechanical contractors. We’re not sure how this joint strategic


planning effort will turn out, but we’re communicating at the highest level, which is extremely important. Lobbying is also an important


priority for MCAA. In Washington this year we continued to push for a crackdown on the misclassification of workers as independent contractors by others in our industry — a gain that all fair contractors will benefit from. And likewise, we are making progress on Federal responsible


Energy efficiency and water efficiency are among the most important aspects of green building— and we excel in these areas.


contracting proposals, bidding reforms, and even repeal of the looming 3% withholding tax on public contracts. Surprisingly, one of our biggest


threats in 2010 wasn’t from Congress but from an unlikely source, the group of accountants that make up the Financial Accounting Standards Board. FASB proposed draft accounting standards that would require numerous additional disclosures on the financial statements of employers participating in multi-employer defined benefit plans. These would include a firm’s withdrawal liability for each and every pension plan to which it contributes — with no regard whatsoever for the remoteness of the possibility that the firm would actually incur that withdrawal liability. Contributing employers — which,


by the way, include every one of MCAA’s members — could expect a


huge administrative burden attempting to gather the required information, and then it would in many cases be misleading at best. These disclosure requirements could


severely impact our industry by resulting in the contraction of surety and financial credit just as the construction market begins to recover. I’m proud to say that MCAA took


the lead within our industry and made a full-court press on this issue, including the formation of a panel of experts, who traveled to Connecticut to meet directly with FASB. Their efforts resulted in a delay in


the implementation of FASB’s standards, along with a recognition on FASB’s part that it needs to explore alternatives to the disclosure of withdrawal liability. FASB has also committed to work


with our team of experts in the coming months to come up with better accounting disclosure rules that highlight real liabilities for financial statement users, but that don’t otherwise threaten our industry. We are hopeful that MCAA’s


leadership will result in a far less onerous proposal that will protect our competitive position. Earlier I mentioned what our


contractors will need to do differently to compete in a changed marketplace, and how MCAA is working to help them do that. One example is the introduction and


spread of Building Information Modeling. A few years ago MCAA created a BIM Committee to guide our efforts in this area. In October we held a highly successful two-day immersion course in BIM technology for mechanical contractors. We also sponsored a study by McGraw Hill on the convergence of green construction and BIM. And we are assessing the legal impacts of the shift toward BIM, which will be the subject of our next BIM conference. In 2011 we’re continuing to work


extremely hard to provide even more quality programs and webinars to help our members compete. That’s why, in fact, MCAA is known throughout our industry as “The Education Association.” Right now we are hard at work


planning MCAA’s Annual Convention, March 6 through 10 in beautiful Maui. Once again there will be great


speakers and our workshops will deliver valuable take-home information on a number of topics. And, as always, the networking and mentoring opportunities our convention affords will pay big dividends to our attendees. All of which explains why I am so


honored to be MCAA president and to have the opportunity to lead this association. We’re looking forward to another strong year in 2011.;


phc january 2011 www.phcnews.com


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