| Chain of demand: Bridge work builds up local economy |
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Every day, Interstate 5 carries an estimated 14,000 commercial vehicles through Oregon, bearing freight with a retail value of approximately $650 million. As an important portion of this vital freight corridor, the soon-to-be-rebuilt I-5 Willamette River Bridge between Eugene and Springfield makes a significant contribution to that circulation of West Coast commerce.
And with a replacement price tag of $147 million for construction, it also has a significant impact on Oregon’s economy.
Funded by the third Oregon Transportation Investment Act and Federal SAFETEA-LU (Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users), the Willamette River Bridge budget represents a sizable capital injection for a state that saw unemployment rates upward of 12 percent earlier this year.
The Oregon Department of Transportation “went local” and filled three of its four main contracting positions on the project with homegrown Oregon companies—OBEC Consulting Engineers, Hamilton Construction and Slayden Construction. And these companies set up a chain of demand by looking for local partners when they need to subcontract part of their work.
As contractors spend money with other companies for specialty services that range from flagging and fencing rental to structural demolition and video-logging, construction dollars keep circulating through local economies. These companies, in turn, subcontract with other firms, furthering the local economic stimulus.
Take Dirt & Aggregate Interchange Inc. of Fairview, Ore., for example. Slayden hired the company to do a variety of projects, including realigning bike paths, building access roads, and installing temporary drainage and fencing. Dirt & Aggregate’s contract, worth almost $1 million, has enabled the company to hire one new apprentice and at least two new laborers in the Eugene area.
“We’ve been fortunate because this work has allowed us to expand outside the 60-mile radius that our division typically covers,” said Corey Pelfrey, project manager and chief estimator for the dirt and pipe division of the company.
Because Dirt & Aggregate spends its money locally, many local Eugene businesses are feeling their pocketbooks expand, too.
Dirt & Aggregate rents housing from Pioneer Management for its workers or, if these units are full, they rent rooms at a local motel. They also rent a storage yard in Eugene to house materials.
Perhaps even more significant for the area’s economy is that Dirt & Aggregate subcontracts with local rock suppliers, truckers and other specialists to help fulfill its contract with Slayden Construction. It turned to Pacific Corrugated Pipe Co.―a pipe supplier with a manufacturing plant in Eugene―for about $40,000 worth of corrugated steel pipe to be used as culverts on the Willamette River Bridge project. Pacific Corrugated has been in business since 1935, with an Oregon operation since the early ’70s.
“Our customers order anything from a few feet of pipe to more than a quarter of a million dollars worth of pipe and related products,” said Larry Wood, operations manager at Pacific Corrugated. “While this is more of a mid-size order for us, every purchase helps us to keep the lights on and keep people employed.”
When Dirt & Aggregate had to remove concrete ditches on the bridge project, it took the concrete to a local aggregate supplier, Egge/Eugene Sand & Gravel, which crushed it and reused it as fill. This project, in addition to other more substantial projects with Dirt & Aggregate, has benefited the company and ultimately meant it could expand its workforce.
“This contract has allowed us to provide Dirt & Aggregate with five to seven trucks, delivering materials to the job site daily, and gave us an opportunity to hire three to four additional drivers. That’s significant during this tough economic time,” said Mark Alberts, materials sales, transportation and dispatch manager. “Without the Willamette River Bridge work, we probably would not have hired any additional drivers.”
In business for 45 years, Egge/Eugene Sand & Gravel is a full-service company with extensive experience in the construction materials industry. According to Alberts, the company tries to spend all its dollars locally.
There’s no doubt that economic rejuvenation provided by the Willamette River Bridge work will extend beyond the end of construction in 2012.
“ODOT is making good on its promise to invest in Oregon businesses and stimulate local economies,” Pelfrey said. “The Willamette River Bridge project is definitely helping us rev up our engines to keep growing.”
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