By Alan Torres
Eugene Register-Guard

Springfield City Council has voted against pursuing an expedited process for city hall renovations, forgoing a staff recommendation, after urging from local construction industry leaders.

“I don’t know that this is the right process for Springfield,” said City Councilor Kori Rodley, joining the unanimous vote.

The process she referred to was Construction Manager/General Contractor.

Oregon law states government agencies in “shall make every effort to construct public improvements at the least cost” through a competitive bid process, but carves out an exception for CM/GC contracts.

Local governments choose CM/GCs because they’re faster than regular government contracts and because they can prevent cost overruns by capping the cost of a contract.

But leaders of local construction firms told Springfield City Council and the Register-Guard that recently, governments have been overusing the practice, which they believe favors larger, out-of-state firms.

Local contractors push back on expedited contracting

Jerry Valencia, owner of Lowell-based Bridgeway Contracting, was one of the local construction leaders who urged councilors to reconsider. Valencia told the Register-Guard he’s seen local governments in Lane County gradually increase their use of CM/GC since 2009, and the change has harmed local businesses.

“These large contractors keep getting a little bit bigger, and bigger and bigger,” he said, while fewer projects are awarded “to the general contractors that actually provide livable wages, family health care, and actually pay the taxes for that bond.”

At a June 22 Springfield City Council meeting, councilors were scheduled to approve a CM/GC process for the city hall maintenance project. The vote would have narrowed the city’s search from the seven contractors that applied to two finalists staff had scored highest (both of which were large multi-state) firms, before the parties submitted cost estimates.

At the City Council meeting, City Manager Nancy Newton said the CM/GC process is warranted because the city hall upgrades are urgent.

“The city has really tried to take this building as far as it can in the least expensive way for a very long time,” she said. “We have two portable air conditioning units that aren’t really working that well … the building itself is conveying some urgency to this decision and I’m really reluctant to postpone it any further.”

Staff also said they believe the CM/GC process saves money. Assistant City Attorney Kristina Kraaz told councilors she doesn’t think the city would find a cheaper contract if it opens up the competitive process.

Valencia disagreed. He said in his experience, CM/GC drives up the cost of contracting, because it’s less competitive and firms awarded a CM/GC contract will always charge the maximum allowed in the contract.

City council opts to give local contractors chance to bid

Councilors unanimously voted to pursue the longer process. They said it was important to give local employers an opportunity to bid for the city work.

“The construction industry right now is really slow, and they have crews and people sitting at home and families that they’d like to be supporting,” Councilor Michelle Webber said.

Valencia called City Council’s decision “a great victory for the Lane County construction community.” Valencia said he would bid for the contract, and he expects other local construction firms will, as well.

Most cases don’t get this outcome

In this case, local contractors successfully pushed back on the plan to award a CM/GC contract, but that’s not the typical result.

On June 26, Lane County notified the firms who had applied to build the Lane County Stabilization Center, that they had narrowed their search from the 10 firms who had applied, to three finalists in another CM/GC process.

In this case, the county didn’t rely on urgency to justify the CM/GC process. Instead in Lane County’s “Notice of Pending Exemption from Competitive Bidding,” the county said it pursued CM/GC because it wanted to consider “qualitative factors” in addition to cost.

“Variables such as unique attributes being required in the design/construction of such a stabilization facility, challenges inherent in new construction on undeveloped land, and the overall magnitude of the project helped inform this decision,” the notice said.

According to Lane County’s scores of these proposals, shared with the Register-Guard by Valencia and John Hyland Construction, two of the 10 firms that applied are based in Lane County. One of those: Eugene-based Essex, advanced, while Springfield-based John Hyland Construction did not. Instead, Lane County named Lake Oswego-based Pence Contractors and Skanska to the final round.

According to the scoring document, Skanska outscored Hyland on “firm history,” “qualifications and experience,” “project staffing” and “project approach.” They tied on “fee proposal.”

In an email forwarded to the Register-Guard, John Hyland Construction President Shaun Hyland objected to the scoring.

“Our local government should be picking on lowest price on a competitive basis, not based on how well our marketing department does,” he wrote.

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A research group backed by contractors is looking to expand its presence in Oregon policy circles with studies of interest to industry.

Contractors are supporting the Common Sense Institute (CSI) as an ally able to bolster their political efforts in Salem and locally with data-driven studies.

CSI’s Oregon chapter is billed as a “non-partisan research organization dedicated to the protection and promotion of Oregon’s economy.” The chapter receives funding from groups including the Associated General Contractors‘ Oregon-Columbia chapter, Oregon Realtors and Oregon Business & Industry, an AGC official said.

CSI was founded in Greenwood Village, Colorado. The Oregon chapter was established in March 2024, according to state records.

“We’ve seen it as something helpful,” said Kirsten Adams, an AGC lobbyist.

CSI produces research on business matters, including a recent study finding “renewed weakness” in Oregon’s labor market at the end of 2025. Another study, released Tuesday, quantified the economic impact of the state’s outdoor recreation industries, such as golf and skiing.

AGC’s Oregon-Columbia chapter supported bringing CSI here after contractors in Colorado spoke positively of CSI’s role in that state, Adams said.

“We talked with our counterparts from AGC Colorado, and they saw some benefit from having a nonpartisan research group,” she said.

Cinamon Watson, the group’s Colorado-based CEO, said CSI’s research does not support either major political party.

“We are not an advocacy organization, and we are not partisan,” she said. “We are strictly nonpartisan. We deliver the facts and the data that impact jobs and the economy.”

Mark McMullen, the longtime former state chief economist, serves as CSI’s vice president of policy and research. McMullen took the CSI job after serving as the state’s point person for calculating the income tax “kicker” refund.

CSI also has chapters in Arizona and Iowa, and has done work in other states.

“When people have good facts and data instead of political spin or rhetoric, they make better decisions,” Watson said.

Some parties are skeptical of research produced by industry-backed groups — reasoning that they have an incentive to produce research that paints industry in a good light or to bury research that does otherwise.

“One has to question the findings in these types of studies given that there is a conflict of interest by the researchers,” stated Richard Clucas, a Portland State University professor of political science, in an email.

Clucas emphasized that he wasn’t familiar with CSI’s research specifically.

CSI Oregon’s board includes Tom Gerding, former CEO and current board chairman of Gerding Cos., based in Corvallis. Gerding has long been involved with AGC. Other board members include Dan Vannoy of Emery & Sons Construction Group, Angela Wilhelms of Oregon Business & Industry, Lynn Snodgrass of Drake’s 7 Dees and Jenny Pakula of Oregon Realtors.

“The board members (in Oregon) are really thoughtful about public policy and do care deeply about the state,” Watson said.

The group’s nonpartisan status does not mean that its reports don’t touch on hot political issues. Last year, as the Oregon Legislature debated a transportation bill to raise $4.3 billion over 10 years, CSI produced two reports analyzing the package’s costs and benefits.

AGC has important issues at play in Salem, including funding for the state’s megaprojects such as the Interstate Bridge replacement and the I-5 Rose Quarter Improvement Project.

As the Legislature meets for a five-week short session that began Monday, CSI will keep churning out analysis.

“We’ve got some good reports coming out,” Watson said.

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The proposed Hood River-White Salmon Interstate Bridge replacement project has received federal approval to advance to final design and construction permitting.

The $1.12 billion Columbia River bridge project spanning Oregon and Washington received a record of decision on Tuesday from the Federal Highway Administration, closing out National Environmental Policy Act obligations.

“What it means is that we have finalized the NEPA process and the project can move forward into final design right away and construction,” Michael Shannon, bridge replacement project director, said in an interview on Wednesday.

Kiewit Corp., the project’s design-build contractor, is on track to hit the 60 percent design level next summer, with a final set of construction plans expected to be ready in spring 2027, Shannon said.

If anticipated funding falls into place, construction would follow in October 2027, Shannon said.

“That is dependent on securing the final federal funding for the project,” he said.

The project team is awaiting a decision on Bridge Investment Program funds. Project officials have requested $530 million from the program, which is administered by the Federal Highway Administration.

The total price tag includes planning and construction and encompasses about $180 million in contingency funding, Shannon said.

This bridge replacement project appears to be moving smoothly toward construction while other major infrastructure plans have been stymied by delayed or canceled funding.

As part of major legislation, President Donald Trump earlier this year rescinded $412.5 million for the Interstate 5 Rose Quarter Improvement Project. Other projects across the nation have likewise not received expected funding.

Shannon said he had no concerns about the Trump administration’s willingness to fund the Hood River–White Salmon Interstate Bridge replacement.

“We got notification that we met the screening criteria for projects under the new administration,” he said.

The project was “highly recommended,” Shannon said. “The project (team) has done everything it can to be positioned to accept award,” he added.

The Hood River-White Salmon Interstate Bridge proposal meets a key threshold, Shannon said: Requested federal funding is less than 50 percent of the project’s total cost. Oregon and Washington have each agreed to chip in $125 million.

The new bridge would replace the existing span, which opened in December 1924. The new bridge would sit slightly west of the current bridge and include two 12-foot vehicle lanes, two 8-foot shoulders and a 12-foot shared-use path for bicycles and pedestrians. Vehicles would be tolled.

The proposed bridge’s 90-foot vertical clearance has been preliminarily approved by the U.S. Coast Guard.

The replacement bridge “would meet current design standards to be seismically sound under a 1,000-year seismic event and operational under a Cascadia Subduction Zone earthquake,” the record of decision states.

Indeed, seismic concerns were a driving force behind the project. The current bridge sits on a sandy, silty layer that is vulnerable to liquefaction.

“It is more susceptible to earthquake than we had thought before,” Shannon said.

The bridge project exemplifies the public-sector work that has buoyed the construction industry while interest rates remain high, private lenders exercise caution, and some types of commercial real estate suffer from oversupply and high vacancy rates.

“Infrastructure funding has been a major source of stability for the construction industry over the past few years,” Macrina Wilkins, a researcher for the Associated General Contractors of America, wrote in an email on Wednesday. “Bridge, highway and other projects supported by the Infrastructure Investment and Jobs Act (and related federal programs) have kept contractors busy and work flowing into the pipeline, even as concerns about labor shortages and economic uncertainty persisted.”

Contractors are “eager to undertake” projects like the Hood River–White Salmon Interstate Bridge replacement “especially in the face of softer private demand,” Wilkins added.

Still, Wilkins stated, contractors should prepare for a leveling off in public infrastructure work: Highway and street spending fell 0.9 percent nationally in August, compared to a year earlier.

“Infrastructure investments are still supporting the industry, just not at the unusually elevated pace we saw earlier in the (Infrastructure Investment and Jobs Act) rollout,” Wilkins wrote.

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Supreme Builders, started by Eric Hernandez in 2021, specializes in residential and commercial construction, including new builds, renovations and remodels. Its projects range from single-family homes to multiunit apartment buildings and commercial spaces. Hernandez occasionally has one or two temporary employees, and most of his work is subcontracted out.

“I wanted to start my own company to have more control over the projects I work on and to bring my vision and values to the construction industry. By starting my own company, I could ensure that quality, integrity and customer satisfaction were always at the forefront of our work.” he said.

“Additionally, having my own business allowed me the flexibility to innovate and implement solutions that I felt would best serve the clients and the community,” Hernandez added.

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Supporters and opponents of a bill that would hold general contractors liable for wage theft by subcontractors and labor brokers clashed before an Oregon House of Representatives committee on Wednesday.

Contractors and other critics said Senate Bill 426 would make them less likely to hire up-and-coming subcontractors.

“I’m kind of offended, frankly, by this approach,” said Rep. Ed Diehl, a Salem Republican who has commissioned construction projects. “It would put me liable for something I have no control over, and it would change my behavior. I would definitely not be reaching out to new startups.”

Khanh Tran, policy director for the National Association of Minority Contractors‘ Oregon chapter, voiced similar concerns. “This bill specifically disincentivizes hiring new contractors,” he said.

The bill from Sen. Floyd Prozanski, a Eugene Democrat, would make an owner and direct contractor “jointly and severally liable” in a civil action for unpaid wages owed to nonunion employees of the contractors or any subcontractors.

The bill is needed to combat rampant wage theft in the construction industry, Prozanski said.

“It is time to make certain that the men and women who do the work get paid for the work that they do,” he said Wednesday in remarks before the House Committee on Labor and Workplace Standards.

Some testifiers placed much of the blame for wage theft on informal labor brokers, who are required to be licensed by the state, but most are not.

Oregon has two licensed labor brokers, said Josh Nasbe, legislative director for the Oregon Bureau of Labor and Industries. He estimated there are “hundreds” of unlicensed brokers operating in the state.

Supporters of the bill said it would create an incentive for general contractors to hire reputable subcontractors.

“Contractors don’t have any incentive to hire licensed, bonded and responsible subcontractors,” said Hank Kaplan, a board member of the Jewish Federation of Greater Portland. “This legislation would provide that incentive.”

Existing legal processes for remedying wage theft are often too slow and complicated, said Martha Sonato, a lobbyist for the Oregon Law Center, which provides free legal help to low-income residents.

“Current protections aren’t enough,” Sonato said.

A lobbyist for landlords argued the bill creates “unintended consequences” in trying to hold bad actors responsible for wage theft.

“It will only lead to disputes that delay housing projects,” said Molly McGrew, a lobbyist for Multifamily NW.

An Oregon Department of Justice advisor, Leslie Wu, said Attorney General Dan Rayfield would welcome “another tool in the toolbox” to combat wage theft.

SB 426 passed the Senate 18-11 in April, with one Republican joining Democrats in sending the bill to the House.

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Arnold Sanchez discovered his passion for construction after working as a pipelayer, but his journey truly began when he enlisted in the U.S. Army as a horizontal construction engineer.

“The Army taught me dedication, discipline and to show up no matter what,” he said.

Sanchez launched Civil West Construction in 2021, offering excavation, underground utilities, foundation work, trenching and support for heavy civil and highway projects. He credits his wife and partner, Kelsey Sanchez, and Ben Atwood, his first field helper, with laying the groundwork for a tight-knit team.

Civil West has grown into a fully operational company with office staff and field crews who are treated like family. Sanchez’s goal is to build a culture that supports personal and professional growth.

“I’m proud of how far we’ve come. We face new challenges every day and I love pushing past limits,” he said.

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The Associated General Contractors of America reported on Thursday that the construction industry will see a mix of ups and downs across different segments in the new year. After surveying nearly 1,300 contractors with Portland-based Sage, AGC released the .

“The survey finds the outlook for 2024 is decidedly mixed, as contractors predict transitions in demands for projects, the challenges they will face and technology they will embrace,” said Stephen A. Sandherr, AGC’s chief executive officer.

Problems with labor shortages, high interest rates and supply chain improved but were still far from normal, he added. That news is compounded with fears over high interest rates and the possibility of a recession.

Infrastructure and public projects remain prime

Ken Simonson, AGC’s top economist, said optimism around most project types was positive but still lower than it was a year ago.

Contractors expected the value of infrastructure projects to be higher in the new year, the survey showed. Water and sewer were at 32 percent, followed by transportation at 30 percent and bridge and highway projects at 30 percent, according to survey results.

Lodging, retail and private office construction will be “bearish,” Simonson remarked. The value for lodging is expected to fall by 3 percent, retail down by 15 percent and private office down by 24 percent, the survey showed.

While the value of public projects was expected to increase, the number of respondents who actually worked on projects supported by Bipartisan Infrastructure Law showed a different story. According to the survey, only 9 percent of respondents said they actually worked on projects supported by the law.

Six percent of contractors said they won infrastructure-law project bids but haven’t started work and 7 percent said they bid on projects but haven’t won awards yet, the survey showed. A total of 33 percent of respondents said they don’t expect their business to change because of the law. The remaining 30 percent said they didn’t know what changes would happen, the survey showed.

AGC asked contractors to predict whether their workforce would increase in 2024. A total of 69 percent of firms responded they would see an increase in their headcount. Of that group, nearly 50 percent said their headcount would rise by 10 percent or less. A total of 18 percent said their headcount would increase by more than 11 percent, while only 4 percent thought their firms would grow by more than 25 percent.

Rising interest rates and financing costs were the top concern for 64 percent of contractors in 2024, survey results showed. Other costs such as trucking, insurance and design services were at 63 percent and economic slowdown or recession at 62 percent.

The remaining top concerns were material costs, direct labor costs, worker quality and an insufficient supply of workers or subcontractors.

Construction continues to invest in technology

“Technology will play an important role in helping teams increase their efficiency with limited resources,” said Dustin Stephens, the vice president of marketing and real estate at Sage.

Between 61 and 89 percent of firms said their technology investment will remain the same, the survey showed. Accounting and project management software both grew at 38 percent. Firms also put more dollars toward document management and estimating software.

According to the survey, around two-thirds of construction firms said they will use mobile software technology for daily field reports. Nearly 60 percent said they will use it for employee time tracking and approval.

The largest information technology challenge for contractors was finding the time to implement new technology and training employees, according to the survey. Cybersecurity and employee resistance to technology took second and third place, respectively, in IT challenges.

Industry wants more young people in the trades pipeline

Sandherr made a call to federal and local officials to boost investment in construction training. He said it was critical for federally funded projects that were likely to start in 2024, which also boosted the industry.

“Many kids don’t know (construction) is a career path,” he added.

AGC officials said they would push for new funding for construction education and training, using momentum from talks around programs such as the Pell Grant. Sandherr explained that AGC wanted to see more people lawfully enter the country and help patch workforce shortages.

Contractors share their predictions

Lynn Hansen, CEO of South Carolina-based Crowder Constructors, said that her firm’s future was bright as it worked on public projects.

“I’m optimistic about Crowder’s markets for the coming year. Our infrastructure markets where we focus water, waste, power, highways and bridges will be fairly strong,” Hansen added.

The executive noted that labor was still a top concern going forward, but those who the company recruited made more than what they previously earned. New engineers needed the least training, so the company was figuring out ways to streamline the process.

“We have good job training for project managers and leaders, but not as good with the craft level,” Hansen noted. Crowder established a registered apprenticeship program a few years ago to pick up the slack, she explained.

While supply chain has improved, finding certain pieces of electrical equipment has remained a challenge, Hansen noted. Some of those delays have gone from months to years and created costs for both general contractors and their clients, she added.

“My new year’s wish is for some stability in the industry. Our employees would like that also,” Hansen said.

By the numbers outlook in Oregon

Oregon firms answered similarly to AGC’s national survey results but differed in some places such as hiring and the types of projects most valued in 2024. A total of 34 Oregon companies answered survey questions.

Most companies predicted the value of projects would stay the same throughout 2024 regardless of what segment. Respondents said they thought the biggest increases would happen for federal (33 percent), hospital (31 percent) and bridge/highway projects (15 percent).

Oregon companies’ predictions about which segments would falter differed somewhat from the national survey, with multifamily residential falling by 33 percent, private office by 27 percent and retail also at 27 percent.

Of responding firms, 32 percent predicted that they would increase their headcount by 1-10 percent in 2024. Around 12 percent answered their firms would grow 11-25 percent, and 3 percent said they would increase by more than 25 percent. Around 21 percent of respondents said their headcount would decrease by around 1-10 percent.

Federal funding was somewhat of a question mark in Oregon compared to the national average. While the national average respondents did not expect any changes because of the Bipartisan Infrastructure Law, around 39 percent of responding firms in Oregon reported not knowing if the law made a difference to their businesses. Around 33 percent said they didn’t expect their business to change because of the law, 9 percent have worked on new projects funded by the law and 9 percent report that they plan to bid on projects but nothing suitable has been offered yet.

Rising interest rates/financing costs was the biggest expected challenge for Oregon construction in 2024, around 79 percent, the survey showed. The next largest concerns were economic slowdown/recession at 76 percent and rising direct labor costs at 61 percent.

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