The construction industry expects higher profits in the coming year and an overall growth in the next two years, according to the 2016 Construction Industry Forecast by Wells Fargo Equipment Finance, an annual survey of construction executives conducted in the previous fall, now in its 40th year.
While still bullish on the economy, the Wells Fargo Construction Optimism Quotient, a measure of confidence on the future of the industry, slipped from last year’s high of 130 to 108 this year. A measure above 75 signals cautious optimism. Anything above 100 is considered highly optimistic. In the past, however, a drop of this magnitude from the previous year has “foreshadowed a pending decline in activity a year or two in the future,” according to the Wells Fargo video explanation of this year’s Optimism Quotient.
Wells Fargo says the 2016 outlook for the industry remains strong, but the construction industry may see some contraction in 2017. “The OQ should be used as a barometer to gauge executives’ opinions, and they are clearly saying that 2016 should be a good year. Over a two year period, most industry executives still believe that the most likely scenario is an expansion of the industry but with some fear of contraction showing up as well,” the video explains.
Read the full forecast here. http://mail.wellsfargoemail.com/constructionforecast Or view the video explanation here: https://www.youtube.com/watch?v=Glxmb1qQVXA&feature=youtu.be
Hogan FY 2017 Proposed Budget Includes Construction Spending
Part of Gov. Larry Hogan’s $17.1 billion operating budget proposal for fiscal year 2017 includes millions to be spent on news schools, infrastructure and other construction programs. Hogan set aside $314 million for new school construction projects, accounting for nearly one-third of FY 2017 capital spending. The budget also earmarks $704,000 to launch the development of four P-TECH 9-14 schools in Maryland.
Transportation infrastructure improvements would receive $3.1 billion in capital spending, and $231 million in Highway User Revenue (HUR) funds, including $54 million in additional capital grants to local jurisdictions are tapped to improve local roads and transportation facilities.
The proposed budget also includes $35 million to demolish the Baltimore City Detention Center and begin designing a replacement facility. Hogan shuttered the detention center last year citing safety and other concerns.
The governor hopes to have approximately a $440 million cash balance going into FY 2018.
Read the press release on the Governor’s budget proposal. http://governor.maryland.gov/2016/01/20/governor-larry-hogan-announces-fiscal-year-2017-budget/
House Bill Would Give Property Tax Break to New/Small Businesses
Known as the Personal Property Tax-Credit for New or Small Businesses, the bill, if passed, “would give every county in the state, as well as Baltimore city, the option to give a property tax credit up to 100 percent against the county or municipal corporation property tax imposed on property that is owned or leased by a new or small business,” reports The Daily Record.