Steady growth means steady work
for construction firms
Growth at U.Va. powers jobs and business
By Charlotte Crystal
Horns father, Jack, came to Charlottesville in 1956 to study
civil engineering and play football at the University. He stayed
to work in construction, starting his own company in 1979.
by Bill Sublette
construction projects, such as the Small Special Collections
Library and the Harrison Institute, will pump an estimated
$1.1 billion into the local economy and generate about 1,450
business found a good mix of work in the area, including projects
affiliated with U.Va. From construction of Klöckner Stadium
to a renovation of the Medical Centers Intensive Care Unit
to the erection of a new columbarium wall, the companys
projects have run the gamut.
Martin/Horn Inc. has about 100 employees, and roughly half work
on University-related projects.
dont know if our company would exist without U.Va.,
said Doug Horn, who with his brother, Ted, serves as vice president
of the family business, while brother Jack Jr. is president and
their father serves as chief executive officer.
is just one of many companies competing to build projects for
U.Va., which has embarked on a construction program that rivals
any since its founding. In this decade, the University expects
to spend well over half a billion dollars on construction projects
that will sharpen and expand its academic, research and entertainment
capabilities, while preserving its world heritage Grounds.
of the money the University spends on construction cycles through
the metro-Charlottesville economy and into Central Virginia from
Harrisonburg to Richmond, according to University and construction
officials. And spending is split about 50-50 between materials
and labor, said Richard Dickman, contract administration manager
for U.Va.s Department
of Facilities Management.
materials are purchased locally within a 50-mile radius
of Charlottesville except for major pieces of equipment
that are needed but not produced in Virginia. So, approximately
half of the funds spent on University building projects go to
pay for building materials at regional retailers and manufacturers,
for labor, the University taps both in-state and out-of-state
industry professionals, hiring architects, engineers and construction
companies according to the expertise required for a particular
project. Over the past five years, U.Va. has awarded 74 percent
of its architectural and engineering contracts to Virginia-based
firms, although out-of-state firms generally have landed the larger
projects which usually require more specialized expertise
earning 46 percent of the nearly $87.5 million the University
paid in such fees.
the University is a state agency, we have to go through the public
procurement process, and contractors have to be licensed in Virginia
to bid on our projects, Dickman said. As a general
rule, we take the lowest bid.
it comes to the construction itself, most of the companies are
either based in Virginia or have permanent offices in the state,
University officials said. Most of the skilled and unskilled labor
is supplied locally, at least from within the state, they said.
our employees are local, coming from no farther away than Richmond,
said Doug Horn. Even our [subcontractors] and our subs
subs are virtually all local.
Doug Lowe, president of Artisan Construction Inc., which, as Martin/Horn
does, bids frequently on University projects, said the exceptions
come when specialized skills are required. For the most
part, we use local subcontractors, except when a project requires
a level of expertise that we cant get locally, he
said. All in all, about 90 percent of the Universitys work
is done by local contractors and suppliers, Dickman said. And
construction workers, regardless of their permanent residence,
spend about 60 percent of their paychecks locally, and pay state
income and sales taxes, he said.
U.S. Commerce Department figures, Leonard Sandridge, U.Va. executive
vice president and chief operating officer, estimates the economic
benefit to the community from the Universitys construction
expenditures at about $1.1 billion, and he expects the spending
to create about 1,450 jobs, directly and indirectly.
anticipated total expenditure for building projects from 2000-08
is about $761.1 million (excluding U.Va.s College at Wise
construction projects). About $68.8 million was completed before
Virginia voters approved $68.3 million in general obligation bonds
last fall. Charles Sack Johannesmeyer, U.Va. director
of facilities planning and construction, said the lions
share of the funding will come from private gifts, outside research
grants and the Universitys local business operations, such
as parking fees and bookstore sales.
have been able to leverage the state funding and bring in significant
private gifts and research dollars to pay for much of this needed
construction, Johannesmeyer said.
blend of public and private funds will enable U.Va. to renovate
old buildings and erect new ones for student classrooms, faculty
offices, scientific laboratories, art studios and performance
while business with the University fluctuates among local firms,
it exerts a stabilizing influence on the areas construction
industry, Doug Horn said.
U.Va. we would probably only have about one-quarter of our employees,
and wages and benefits would be a lot less, Horn said. All
you have to do is to go into the [Shenandoah] Valley and see the
market the kind of wages and benefits people pay in the
construction industry to get an idea of what the market
would be like here without U.Va.
and Northern Virginia have had incredible booms in the construction
industry, but during the down times, theyve had big layoffs,
he said. That hasnt happened here in large part because
of the steady stream of business flowing out of the University.
EconomicEngine is an ongoing series in Inside UVA. For more information,
go to www.virginia.edu/insideuva/