AGC Urges Senate to Protect Contractor First Responders

Mon November 28, 2005 - National Edition
Construction Equipment Guide

Four members of The Associated General Contractors of America (AGC), some of whom were among the first contractors to respond to help stop the water from flooding New Orleans in the wake of Hurricane Katrina, urged Congress to pass legislation that would limit the risk of liability that contractors face when responding to a natural disaster such as Hurricane Katrina.

These first responders testified before the Superfund and Waste Management Subcommittee of the Environment and Public Works Committee, chaired by Sen. John Thune, R-SD, telling senators that they did what they had to do to save their city.

“We knew that the trial lawyers were out there, but we simply could not take the time to imagine that someone would sue us for trying to save the city — the only risk on our minds was the risk that New Orleans would simply cease to exist,” said Warren Perkins, vice president, Risk Management, Boh Brothers Construction Company.

“Now it is time for Congress to give the contractors, working hard to revive New Orleans and the remainder of the Gulf Coast, some limited measure of protection from unlimited tort liability simply for being there to meet the need.”

Private construction contractors have enabled the nation to recover from one disaster after another. They were quick to arrive on the scene of the terrorist attacks on the World Trade Center, and for most of the following year, they worked hand-in-hand with federal, state and local officials on rescue, recovery and clean-up efforts. Yet, class actions, alleging mass torts and demanding billions of dollars, have been filed against all four of the contractors that supervised the clean-up from the terrorist attacks on Sept. 11.

“Standing side-by-side with my employees, I have personally done a lot of the work, and I have done it under crisis conditions,” said Tony Zelenka, president, Bertucci Contracting Corp. “We have to put our assets on the line if we want to help, which means I may be at risk of losing my company for simply doing what I have been hired by the federal government to do — simply for helping to save my city.”

The Gulf Coast Recovery Act seeks to limit protection for government contractors from the tort liability that might otherwise arise from their work for the disaster relief agencies. In the process, the bill also blocks court actions that could stall the recovery from a major disaster.

“While many first-rate contractors are already on the ground participating in this important effort, many others are hesitant to get involved in projects of this magnitude unless they have insurance against what are normally quantifiable risks,” added Paul Becker, president, Willis Risk Management.

The bill does not, however, insulate any contractor from any enforcement action that any federal, state or local agency may bring. It does not limit any public agency’s authority to take whatever steps it may deem necessary to ensure full compliance with its rules or regulations, or to punish noncompliance.

All environmental, safety and health, labor and ethics laws would continue to apply. In addition, the bill would leave contractors fully liable for any personal injury or property damage that resulted from any recklessness or willful misconduct.

“The AGC members who testified today know first-hand the risks their companies face when aiding government rescue, recovery and reconstruction,” said AGC CEO Stephen E. Sandherr. “AGC urges congress to pass the Gulf Coast Recovery Act and give contractors some measure of protection from the risk of future litigation for providing essentially public services in a time of crisis.”

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