Surety Bond Now a Valid Performance Guarantee for NC Developers (guest post)

subdivision

Welcome summer days!  Today we have a guest post by Todd Bryant, president and founder of Bryant Surety Bonds. He is a surety bonds expert with years of experience in helping contractors get bonded and start their business.  While design professionals generally don’t have to deal with performance bonds directly, they are often at the front lines of advising owners as to various Requests for Proposals submitted by hopeful contractors.  In that spirit, be sure to read how the new law changes security requirements.

 Take it away, Todd!

Last year wrapped up with some good news for North Carolina subdivision developers: House Bill 721 confirmed that construction bonds are, in fact, a viable form of performance guarantee. Previous legislation was ambiguous on this point, but the new bill– which took effect last October– sought to clear up the confusion.  Although the new rules have been in effect for eight months, there’s been scant coverage of the changes, and what they mean for developers.

City Ordinances for Subdivisions

HB 721 is a revision to a section of North Carolina General Statutes, which authorizes cities to regulate land development with their own subdivision control ordinances. Ordinances are meant to ensure that land is developed in an organized fashion, to avoid overcrowding and congestion.

Cities have the discretion to set their own requirements for developers. Usually, cities ask developers to include certain features in new subdivisions, to fit in the city’s infrastructure. These might include recreational space for residents of the development, or building easements for existing roads and utilities. Some cities will allow developers to furnish funds for these public improvements, instead of building them themselves. Often, ordinances ask for detailed, up-to-date plans throughout project construction, so any changes can be approved by the city in advance.

To prove that they will follow local ordinances, subdivision developers must usually furnish the city with some kind of performance guarantee. According to the new bill, a surety bond officially meets the criteria for this guarantee.

The Facts on Surety Bonds

If you’re a design professional or developer in North Carolina, you’re probably familiar with these bonds already. Construction bonds, also known as contract bonds, are usually required of contractors who take on public construction projects. More and more, large private projects are requiring these bonds as well. There are a few different types of contract bonds, including bid bonds, payment bonds, and performance bonds, but they all serve a similar function. Contract bonds work like a line of credit for the developer, to ensure the project is completed on time, and according to the stipulations of the contract.

North Carolina HB 721 relates primarily to performance bonds, which are the type of contract bonds that cities will most often require from subdivision developers. With this new law, construction bonds are officially recognized as a valid form of performance guarantee that North Carolina subdivision developers can submit to demonstrate that they will follow all city ordinances.

HB 721 also includes some guidelines about how big this surety bond must be. Although cities will have the authority to set the bond amount on a case-by-case basis, it can’t exceed 125% of the estimated project cost.

Of course, surety bonds aren’t the only kind of performance guarantee that’s acceptable. Developers will still have the option to submit a letter of credit instead, or some equivalent security. However, the amount of credit that’s needed to satisfy this requirement is usually out of reach of some smaller developers.

Posting a bond requires much less capital than submitting a letter of credit, since the bond cost is only a small percentage of the total bond amount. The clarifications in HB 721 could be a boon for North Carolina developers who want to grow their business, as it could enable them to take on bigger projects. City officials in North Carolina are pleased with the new law, as well, as they believe this will make compliance and accountability easier, for government officials and subdivision developers.

If you’re a developer with questions about local ordinances, make sure to check with zoning officials in your subdivision’s city or county.

Thanks Todd for your article!  Readers, if you have questions or comments about how HB 721 affects your projects, feel free to share in the comments.

 Image source: https://flic.kr/p/9KpZH

Contracting Business Seminar in Durham next week- get a free ticket

Want a free ticket to a seminar on business development?  Just across my desk is a seminar Success by Design Day – which is coming to Durham, North Carolina NEXT WEEK- that is aimed at anyone involved in construction.  The seminar is designed “to help contracting business owners grow their companies with better marketing, leadership, management and recruiting practices.”

Event subjects include:

  • Success by Design | Service Nation COO & HVAC Industry Top 10 Influencers – David Heimer
  • Cracking the Success Code | International Speaker & Business Coach – Mark Matteson
  • Social Style Success | Service Roundtable VP of Strategic Alliances – Liz Patrick
  • Q&A Segment with Serial Entrepreneur – Ben Stark

There is also free brealecturing mankfast, lunch, and a cash prize drawing.

Date:               Wednesday, Nov 4th 2015  8:30AM-4:00PM

Location:        Marriott at Research Triangle Park 4700 Guardian Drive, Durham, NC 27703

 

I have not vetted this seminar, but thought it might be of interest to some of my readers.  And hey, free is free, right?  Shoot me an email if you want to grab one of my (limited) free tickets.

Turning Manure into megawatts (Swine Farm Biogas Renewable Energy Project)

As I noted in my last post, Withers & Ravenel’s Swine Farm Biogas Renewable Energy Project, located in Bladensboro, North Carolina, is one of this year’s ACEC Excellence in Engineering Award winners.

I asked the folks at Withers & Ravenel to give share more about their project, how it was conceived, and how it was designed.

Why Swine Farms? What was the genesis of this Project?pig outline

North Carolina is “pork proud”, with approximately 9 million hogs on farms scattered throughout the eastern part of the State. These farms rely on open pit lagoons and land application for the treatment and disposal of animal waste.   However, open-air treatment lagoons have a poor reputation among some lawmakers, residents and environmentalists. They are accused of creating sickening odors, allowing methane to escape into the atmosphere, and contaminating groundwater and streams.

Because of environmental concerns, the State temporarily suspended permitting the construction and operation on any new swine farms utilizing lagoon treatment systems in 1997, and required new farms to meet “environmentally superior technology” (EST) standards.  Since the enactment of the suspension, there have been no new hog farms introduced in North Carolina.

Tax Credits, Legislation, and Funding

In 2007, the State passed Senate Bill 3, which pushes the use and development of renewable energy standards, the State took a big step toward encouraging innovative treatment technologies for swine waste by mandating utilities to purchase Renewable Energy Credits (REC) generated from swine waste. The Bill also provides a 35% State tax credit in addition to the Federal 30% tax credit.

Spurred by the availability of the NC Green Business Fund grants from the 2009 American Resource Recovery Act, Withers & Ravenel conceived the 600kW renewable energy project and assembled the project team, which included developer AgPower Partners LLC, Withers & Ravenel engineers, and Barnhill General Contractors.

The project was able to receive over $2 million dollars in grants and tax credits, including a $500,000 grant from the NC Department of Energy and $1.5 million grant from the US Treasury. The Owner, Billy Storms, was able to finance the balance of the project cost through a loan with the Cape Fear Farm Credit Association.

Storms Farm Digester Site

Storms Farm Digester Site

Engineering a Plan for the System

In North Carolina, swine farms flush the houses with water in a closed system with a lagoon providing storage and treatment of waste which is then applied to crops. With this process, the waste is diluted to around 1-2% solids.  However, in order to reduce the water content for more efficient temperature control of the anaerobic digestion, the waste needs to be between 5-10% solids.

With the implementation of scraper technology, swine waste volume was significantly reduced by eliminating the added liquid from the flushing system.  This made the Storms Farm much less reliant on the volume required in the existing lagoons, reduced the required size of the anaerobic digester, providing benefits to both the waste handling concerns and to energy production.  The scraper system also reduced the amount of ammonia gas in the barns, which is beneficial to animal and human worker health.

Most digester systems for swine manure in North Carolina have relied on ambient covered lagoons. However, at Storms Farm, with the scale of a 600 acre farm and swine houses separated by as much as a mile, it was not cost-effective to build and cover a new lagoon to treat the waste using anaerobic digestion.  The distance between the 23 barn complex made it problematic to pump waste because of build-up in the pipe known to cause maintenance and failure problems.

After review of viable technologies, Withers & Ravenel recommended DVO Anaerobic Digesters to supply the digester technology for Storms Farm. DVO has an extensive tract record using their patented mixed plug-flow digester technology on dairy farms, but there was no comparable swine waste facilities using mesophilic digestion in the US.   Europe has a substantial number of facilities that use swine manure mixed with other substrates, but there was no reliable source of data for the gas yield using solely swine waste substrate.

As a result, Withers & Ravenel took multiple manure samples from local farms and had them tested to help estimate the biogas yield. Even with this data, there was very little information to collaborate the projected biogas yield. After all alternatives were evaluated, the most cost-effective, efficient option was to construct a heated mesophilic digester system with cogeneration and to convert the barns to scraper manure removal systems.

Receiving Pit and Generator Building

Receiving Pit and Generator Building

Construction Issues

Geotechnical borings were done and revealed the need to raise the digester above grade due to a high ground water table. This required sloping the backfill around the tank as insulation to maintain the needed 95 degree temperature in the mesophilic process.  The report also revealed the need to pre-load the site to avoid potential settling of the digester and cogeneration building.  This additional grading and site work was necessary from the original conceptual site plan.

The Digester Operation

The scraper system scraps the waste to a gravity collection system and storage tanks behind each barn. Two vacuum trucks and drivers empty each of the 23 tanks daily to collect the manure collected from each of the barns, drive to the digester facility and empty the manure into the influent pump station.

Manure is pumped into the  1.1 million gallon in-ground concrete digester where the temperatures are maintained above 95 degrees (mesophilic) and the natural occurring anaerobic bacteria destroy the volatile solids, produce the bio-gas containing 65% methane, kill pathogens, and produce a high quality inorganic waste product virtually pathogen and odor free for storage and, eventually, land application as fertilizer. At Storms Farms, about 60,000 gallons of swine waste is processed each day. The biogas is “scrubbed” of corrosive components and combusted in an 845 HP gas driven engine/generator integrated system provided by Martin Machinery, from Latham, Missouri.

The digester produces wastewater that is free of pathogens and odors and removes 90% of the phosphorus and 75%  of ammonia nitrogen.  The electricity – enough to power over 300 homes – is sold to North Carolina Electric Membership Corp.’s grid network.

Through this design, Withers & Ravenel was able to develop Storms Farm into the largest swine biogas renewable facility in North Carolina, generating 600kW of power with an operating capacity of 95%.

Generator Room

Generator Room

The volume reduction due to the implementation of the scraper system and digestion process has allowed the treated effluent to be returned to one of the existing lagoons, reducing the dependence on the original six lagoons on the site.

Future projects to remove the inorganic solids remaining in the effluent by dewatering and to treat for additional phosphorous and ammonia nitrogen removal are in the planning stages in order to meet the additional requirements of an EST standard farm.

What was the Owner’s involvement?

Billy Storms, owner of Storms Farms was instrumental in getting the Project off the ground, through financing the project, through the willingness to change the method of manure management and by accepting the technological challenge of running what is, essentially, a small wastewater treatment and power plant. He was a true partner in the project and was directly responsible for the selection and installation of the manure scraper system in all of the barns, implementing the operations of the truck collection system, the digester and generator systems as part of the farm operations.

Storms Swine Waste Ribbon Cutting

Billy Storms cuts ribbon at Opening Ceremony; team members look on

What can we learn from this project?

This project demonstrates a method to economically build new swine farms without total dependence on the historical open air lagoon treatment system, and flushing system collection methods, a conversion that is necessary to meet the State EST standards. The system also develops renewable energy meeting the goals in Senate Bill 3 requiring swine waste to be utilized in a percent of the production of renewable energy.

However, because of the cost, risk, and complexity of the project, its applicability may be limited to a handful of existing farms in North Carolina.  Larger farms, preferably more than 50,000 animals, are required in order to have the scale to produce the amount of energy to have an economical rate of return on investment.

Thanks, Withers & Ravenel, for the detailed project description. Your turn: Thoughts? Comments? Questions for the team?  Shoot me an email or post in the comments below.

Photos (c) Withers & Ravenel; Pig outline courtesy Pixabay.

Of Bridges, Biofuels, and Buildings (Engineering Excellence Awards)

As I noted earlier this week, the ACEC of North Carolina’s Engineering Excellence Awards gala was held last month. 13 amazing projects were awarded recognition, including projects involving environmental and coastal issues, higher education facilities, and government projects.

Each project was important, unique, or challenging in some manner. In my next post, I will highlight one of the most unusual– the Swine Farm Biogas project by Withers & Ravenel.  In the meantime, here are all of the winners, which I’ve loosely sorted into categories:

Mingo Creek Trail Bridge

Mingo Creek Trail Bridge

Coastal & Environmental projects

The Karen Beasley Sea Turtle Rescue and Rehabilitation Center, Surf City, NC (Cavanaugh & Associates)

Sea Bright to Manasquan Profile Survey, NJ (McKim & Creed)

American Tobacco Trail Pedestrian Bridge, Durham, NC (Parsons Brinckerhoff)

Mingo Creek Trail, Knightdale, NC (Stewart)

Town of Hillsborough Riverwalk, Hillsborough, NC (Summit Design and Engineering Services)

Swine Farms Biogas Renewable Energy Project, Bladenboro, NC (Withers & Ravenel)

 

Marsico Hall at UNC

Marsico Hall at UNC

Campus & Higher Education projects

South Halls Renovation, Penn State, University Park, PA (Clark Nexsen)

Science & Technology Building, Fayetteville State University, Fayetteville, NC (McKim & Creed)

Marsico Hall, University of North Carolina, Chapel Hill, NC (Mulkey Engineers & Consultants)

Military, Municipal, & Highway projects

Infantry Squad Battle Course, Marine Corps Base Camp Lejeune, Jacksonville, NC (Catlin Engineers and Scientists)

Carolina Field of Honor War Memorial, Kernersville, NC (Woolpert)

Broad Avenue Bus Terminal, High Point, NC (Mulkey Engineers & Consultants)

NC DOT Land Application of Concrete Byproducts, NC (S&ME)

The diversity of the award-winning projects was very clear, as even a cursory review of the projects demonstrates.  I recommend you follow the links to the specific projects to see some great photos and hear more about the projects in detail.

In the meantime, tell me what project you would have given the “best in show” award to if you were the judge.  Or, was a project left out of the awards that you thought superior to some of these?  Share your thoughts about both these projects, and any others that you think should have made the cut, in the comments section.

Photo credits:  Mingo Creek Bridge by James Willamor; Marsico Hall by Bbfd

RDU Terminal 1: Going Green

Last week, I had the fortune to join the Triangle USGBC for its “Talk & Walk” about the RDU Terminal 1 renovation project and its sustainable features.  For those who haven’t had the chance, I recommend you check out the new terminal specifics the next time you find yourself jet-setting in or out of Raleigh on Southwest airlines.

Terminal 1 has been in operation since 1981, with the last upgrade in 1991.  The 2010 opening of the new Terminal 2 had, until now, cemented Terminal 1’s status as the airport’s ugly duckling- complete with the long, featureless metal addition abandoned to times past.

outside RDU Terminal 1

While the $68 million Terminal 1 renovation cannot compete with the Terminal 2 $580 million budget, it nevertheless is an entirely re-imagined space.  Better traffic flow (yes, you can now find where to go through security!), increased daylighting, a new canopy system, and commercial curb canopy (see photo) all complete the new architectural image.

Clark Nexsen principals Irvin Pearce and Doug Brinkley explained the renovation, which included energy saving escalators- the first escalator system in North Carolina that slows down during non-use.  Other sustainable features include LEED complaint flooring, 86% structural building re-use (slabs on grade, composite decks, and structural roof deck), and 28% reuse of exterior walls.

Other highlights of the construction include:

  • An insulated translucent exterior wall panel (Kalwall) to address both security concerns and reduce electrical lighting loads
  • A requirement that lease tenants comply with LEED requirements on the upfit of tenant space, as part of an Innovative Design LEED credit
  • Use of  a 2″ metal panel with reticulating foam seals as a rain screen to produce a well insulated building

Another nice touch– the art above the baggage claim area.  Entitled “Highwire Travelers”, artist Gordon Huether’s sculpture consists of 7 figures suspended above the terminal floor, some balancing luggage on long poles.  (see photos)pointing travelers

balancing luggageThe project is awaiting LEED certification from the US Green Building Council.

 

Have you seen the “new” Terminal 1?  What are your thoughts and impressions?

 

 

 

Photos by Melissa Brumback. 

Creative Commons License

 

Copyright © All Rights Reserved · Green Hope Theme by Sivan & schiy · Proudly powered by WordPress