Phase 2 streetcar to UMKC

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Re: Phase 2 streetcar to UMKC

Post by beautyfromashes » Sat Jun 30, 2018 2:45 pm

Not really a great time for infrastructure projects. Economy booming so demand and prices are high, unemployment low so harder to find good workers at a reasonable price and tariffs will cause steel and other resources to be much higher.

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Re: Phase 2 streetcar to UMKC

Post by anonkcmo » Sat Jun 30, 2018 2:48 pm

Lots of speculation but no real hard numbers yet.

Perhaps they should have budgeted to buy American steel in the first place.
Is Chinese steel really 40% cheaper than US steel even after transport that so many contractors are buying Chinese before American?
If so, that should be a huge red flag.
This issue is complicated, we need US steel to make a comeback and our manufacturing sector to grow.
No easy answers, but I hope the US steel industry doesn't gouge because that will only hurt them in the long run.

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Re: Phase 2 streetcar to UMKC

Post by DaveKCMO » Sat Jun 30, 2018 2:52 pm

anonkcmo wrote:Lots of speculation but no real hard numbers yet.

Perhaps they should have budgeted to buy American steel in the first place.
Is Chinese steel really 40% cheaper than US steel even after transport that so many contractors are buying Chinese before American?
If so, that should be a huge red flag.
This issue is complicated, we need US steel to make a comeback and our manufacturing sector to grow.
No easy answers, but I hope the US steel industry doesn't gouge because that will only hurt them in the long run.
US-made steel is already required for federally-funded transit projects, as are vehicles (now approaching minimum 70% US content and 100% US assembly), and a host of other "manufactured" items. What's happening is everyone else is now buying American steel (theoretically a good thing in the long term) or manufacturers are just raising prices knowing that they can profit off of the new tariffs.

The point is that projects that are out to bid right now -- like Prospect MAX -- are seeing higher than expected prices for these items, despite having engineering estimates that are very conservative (and federally-required contingencies).

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Re: Phase 2 streetcar to UMKC

Post by grovester » Sat Jun 30, 2018 6:40 pm

Gotta love capitalism!

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Re: Phase 2 streetcar to UMKC

Post by im2kull » Sun Jul 01, 2018 1:57 pm

DaveKCMO wrote: US-made steel is already required for federally-funded transit projects, as are vehicles (now approaching minimum 70% US content and 100% US assembly), and a host of other "manufactured" items. What's happening is everyone else is now buying American steel (theoretically a good thing in the long term) or manufacturers are just raising prices knowing that they can profit off of the new tariffs.
Partly correct.

US made products & materials (Steel or not..think pens, paper, vehicles, etc) are already required to be purchased first for ALL government purchases.. not just federal transit projects. The problem is, and has been, that people throughout the process (From design to purchase) are either ignorant of this fact or willfully ignoring it to make their proposal sound better than the opponents by pricing out cheaper import materials. This is justified by claiming that the import items fill a "unique" requirement that no domestic company can fulfill, thus allowing the purchase of the import items. Import items/materials are typically 50% cheaper than the domestic counterpart.

The price increase you're seeing now isn't the result of american steel manufacturers price gouging, it's the addition of the tariff's on the continued purchase of import items and material to fill existing obligations. People don't change what they're doing overnight. These contractors are used to being able to (Unethically) undercut their competitors (Ethical) bid by pricing out import materials instead of American materials (and thus forcing the government to choose their bid, the cheapest one, as is typically required for government purchases..IE: Cheapest bid wins), and that will continue until it's more expensive to buy import or until they end up in jail. Both of which are unlikely to ever occur. In the meantime all their existing quotes/bids will jump up in price and they'll blame the tariff's, instead of their unethical behavior in skirting past the existing government "Buy USA" contract rules. Enjoy the hypocrisy.

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Re: Phase 2 streetcar to UMKC

Post by beautyfromashes » Sun Jul 01, 2018 5:11 pm

And a lot of the reason that foreign goods, especially from China, are so much cheaper is because environmental effects are largely ignored. China has some of the worst air quality in the world. Instead of calling it a tarrif, they should impose an ‘environmental surtax’ just on that country. The idea of imposing tariffs strictly due to trade imbalance is ridiculous.

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Re: Phase 2 streetcar to UMKC

Post by shinatoo » Sun Jul 01, 2018 8:54 pm

Most of our steel is imported from Canada anyway, something like three times as much as China. Mexico even imports more steel than China. There is a nail manufacture in Poplar Bluff that is laying off half it's crew because they import steel from Mexico and pricing is killing them. The steel industry is going to see an uptick in jobs but the increased pricing is going to cause layoffs downstream as manufacturing, fabricating, and construction becomes cost prohibitive.

You will also see prices in steel stablize as steel mills come back online. The Granite City mill is working as fast as they can to get their second furnace fired back up and is now operating their primary 24/7.

It's a long and complicated switchover. I'm not an economist so I don't know how this will play out, or how it has played out in similar scenarios, but it's going to be a bumpy ride.

I imagine with increased counter tariffs, and the increase in the cost of steel and other metals, it's going to hit GM and Ford pretty hard.
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Re: Phase 2 streetcar to UMKC

Post by flyingember » Mon Jul 02, 2018 11:41 am

shinatoo wrote: It's a long and complicated switchover. I'm not an economist so I don't know how this will play out, or how it has played out in similar scenarios, but it's going to be a bumpy ride.
One thing to realize is that many times businesses use these kind of involuntary price increases as new permanent base prices. They'll use the spike as the reason up front and keep this price after the outside influence goes away and hope customers don't notice.

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Re: Phase 2 streetcar to UMKC

Post by shinatoo » Mon Jul 02, 2018 1:48 pm

flyingember wrote:
shinatoo wrote: It's a long and complicated switchover. I'm not an economist so I don't know how this will play out, or how it has played out in similar scenarios, but it's going to be a bumpy ride.
One thing to realize is that many times businesses use these kind of involuntary price increases as new permanent base prices. They'll use the spike as the reason up front and keep this price after the outside influence goes away and hope customers don't notice.
In the consumer world maybe, but not in the commercial world. Every company that buys steel, or metal of any kind, has a staff of purchasing agents that are shopping and bidding everyone against each other.

Unless there is collusion, prices never stay stable for long.

Customers notice, and watch, all day every day.
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Re: Phase 2 streetcar to UMKC

Post by DaveKCMO » Mon Jul 02, 2018 7:50 pm

Back to streetcar. Expect the price tag to increase as a result of market fluctuations. Period.

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Re: Phase 2 streetcar to UMKC

Post by DaveKCMO » Thu Jul 05, 2018 4:55 pm

https://www.bizjournals.com/kansascity/ ... riffs.html
Many transportation projects, such as bridges, guardrails and tracks, use hot-rolled steel, which was priced at $914 per ton at market open Tuesday, according to CME Group Inc. On March 1, hot-rolled steel was priced at $793 per ton, and a year ago, it cost $625. For a project the size of the starter line, that translates to an increase of $244,205 in steel costs in the last year.

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Re: Phase 2 streetcar to UMKC

Post by alejandro46 » Sat Jul 07, 2018 11:37 am

DaveKCMO wrote:https://www.bizjournals.com/kansascity/ ... riffs.html
Many transportation projects, such as bridges, guardrails and tracks, use hot-rolled steel, which was priced at $914 per ton at market open Tuesday, according to CME Group Inc. On March 1, hot-rolled steel was priced at $793 per ton, and a year ago, it cost $625. For a project the size of the starter line, that translates to an increase of $244,205 in steel costs in the last year.
Thanks that really puts it into perspective.

While not cheap, that doesn't translate to an absolutely massive increase for a project of this scale.

Im guessing from my experience working on construction projects, but labor is often where a lot of the cost fluctuation comes from.

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Re: Phase 2 streetcar to UMKC

Post by flyingember » Sat Jul 07, 2018 12:26 pm

I saw somewhere that labor is increasing 4% per year in construction and one page said to expect 3-4% in 2018. The industry dropped dramatically in workers post-2008. Something like 2.25 million jobs dissappeared by 2010 and as recent as 2017 was still only 1.5 million of the way back to employment levels.

I found a page that said materials went up 5.6% annually April to April. It jumped even more

So it's possible that labor increases are less than materials in the near term

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Re: Phase 2 streetcar to UMKC

Post by FangKC » Sat Jul 07, 2018 2:04 pm

I read somewhere that there is also a problem getting younger people to join the building trades, and thus, there aren't people replacing those who are aging out. This is causing more demand for those who currently work in trades.

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Re: Phase 2 streetcar to UMKC

Post by shinatoo » Sun Jul 08, 2018 10:27 am

It's almost like we need immigrants to fill those jobs.
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Re: Phase 2 streetcar to UMKC

Post by anonkcmo » Sun Jul 08, 2018 2:15 pm

FangKC wrote:I read somewhere that there is also a problem getting younger people to join the building trades, and thus, there aren't people replacing those who are aging out. This is causing more demand for those who currently work in trades.
Millions of young American males glued to Playstation and the Internet instead of investing in the future and learning a trade.

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Re: Phase 2 streetcar to UMKC

Post by normalthings » Sun Jul 08, 2018 3:42 pm

shinatoo wrote:It's almost like we need immigrants to fill those jobs.
Yes, unless we are able to get our society to value college in a more realistic manner. As in, the vast majority of jobs don’t really need a 4 year degree. And that trade jobs make good money with no debt attached.
Millions of young American males glued to Playstation and the Internet instead of investing in the future and learning a trade.
I think our education and socialization system does more to prevent and discourage kids than internet/games do. Most of our society heavily pushes children down the college path their entire lives. How can we then blame the kids when the grow up and don’t want to work in the trades? For example, the NKC SD requires(or required relatively recently) all students to apply to college. Including the ones who know/knew they want to go to Trade school. It’s attitudes and programs like that that are the real problem..... Also, getting women more involved in the trades is at least equally important.

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Re: Phase 2 streetcar to UMKC

Post by flyingember » Sun Jul 08, 2018 3:49 pm

normalthings wrote:
shinatoo wrote:It's almost like we need immigrants to fill those jobs.
Yes, unless we are able to get our society to value college in a more realistic manner. As in, the vast majority of jobs don’t really need a 4 year degree. And that trade jobs make good money with no debt attached.
Millions of young American males glued to Playstation and the Internet instead of investing in the future and learning a trade.
I think our education and socialization system does more to prevent and discourage kids than internet/games do. Most of our society heavily pushes children down the college path their entire lives. How can we then blame the kids when the grow up and don’t want to work in the trades? For example, the NKC SD requires(or required relatively recently) all students to apply to college. Including the ones who know/knew they want to go to Trade school. It’s attitudes and programs like that that are the real problem..... Also, getting women more involved in the trades is at least equally important.
I like the idea of having paid on the job student training requirements in the bid requirements for public contracts over a certain dollar amount. The equivalent of a college internship for trades. Maybe split the cost 50-50 or something.

Like the streetcar construction could have two trainees involved. The airport 10-15.

I kind of feel like coordinating with the local community colleges would work well for this. Use them to design a curriculum, hits and such. Maybe work with a group like the Full Employment Council too.

The idea in the end is government can’t do everything and instead of funding welfare it can fund a training program where it has power to make things happen

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Re: Phase 2 streetcar to UMKC

Post by normalthings » Sun Jul 08, 2018 3:54 pm

flyingember wrote:
normalthings wrote:
shinatoo wrote:It's almost like we need immigrants to fill those jobs.
Yes, unless we are able to get our society to value college in a more realistic manner. As in, the vast majority of jobs don’t really need a 4 year degree. And that trade jobs make good money with no debt attached.
Millions of young American males glued to Playstation and the Internet instead of investing in the future and learning a trade.
I think our education and socialization system does more to prevent and discourage kids than internet/games do. Most of our society heavily pushes children down the college path their entire lives. How can we then blame the kids when the grow up and don’t want to work in the trades? For example, the NKC SD requires(or required relatively recently) all students to apply to college. Including the ones who know/knew they want to go to Trade school. It’s attitudes and programs like that that are the real problem..... Also, getting women more involved in the trades is at least equally important.
I like the idea of having paid on the job student training requirements in the bid requirements for public contracts over a certain dollar amount. The equivalent of a college internship for trades. Maybe split the cost 50-50 or something.

Like the streetcar construction could have two trainees involved. The airport 10-15.

I kind of feel like coordinating with the local community colleges would work well for this. Use them to design a curriculum, hits and such. Maybe work with a group like the Full Employment Council too.

The idea in the end is government can’t do everything and instead of funding welfare it can fund a training program where it has power to make things happen
The people building the airport already have a few students working for them(not trade type). But..... I’m pretty sure training young people in the trades was part of the CBA.

Eventually, I’d hope to see the trades starting programs in local high schools.

On another note, I have heard a lot of criticism of WBE/MBE reqs that is related to this issued. I think there may be some merit to people’s argument of “why don’t we require the training and potential hiring of young people from the poorest areas instead” and “M/WBE firms often aren’t from the poorest of the poor neighborhoods.” Im not sure how true the last argument is ,but training/hiring requirements for the poorest neighborhoods should be studied. iMhO.
Maybe this and M/WBE reqs. can be balanced on future big projects.

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Re: Phase 2 streetcar to UMKC

Post by FangKC » Sun Jul 08, 2018 4:41 pm

The Manual Career and Technical School downtown does some of this type of training within the Kansas City Public School District., and those credits can be transferred to a vocational college.

That vocational metropolitan community college branch in the East Bottoms is moving/downsizing because they don't have enough students to justify all the space they rent.

I do agree that our society tends to direct young people towards the college path, instead of the vocational path. I'm sure most of us know that there are some people who aren't interested in the academic life, and whose talents are more hands on, mechanical skills. My older brother has always been able to repair vehicles from the time he was teen. I have no interest in that myself. We are just built differently. My nephew and his ex-wife were both professional welders, and that is how they met.

Many people who leave trade schools end up making as much or more than someone with a 4-year college degree.

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