RECAP: MAY MEMBERSHIP MEETING: TARIFF TALK

Saul Ewing Construction Group attorneys Jim Rohlfing and Matthew Bryant joined SMACNA Greater Chicago members for our May 13 membership meeting. The duo shared insights into the turbulent and fluid nature of President Trump’s tariffs. 

Simply put, a tariff is a cost that’s going to be paid by someone on a construction project. Historically, tariffs have been used to raise revenue. Today, they’re a means of protecting domestic industries from foreign competition. Navigating a fair and reasonable contract will be (and should always be) of utmost importance to help lessen the direct and indirect risks on businesses. 

Throughout their presentation, Rohlfing and Bryant detailed how SMACNA Greater Chicago members can be proactive in identifying vulnerabilities and take pre-contract steps to help minimize risks. 

PRE-CONTRACT STEPS TO MINIMIZE RISK

01: Determine how your critical materials are sourced and consider whether there are domestic alternatives or alternative materials with lower tariffs 

02: Solidify relationships with supply chain vendors and explore the possibility of lockingin a price

03: Modify means and methods, such as off-site assembly and pre-fab

04: Notify customers early so they can raise any issues with owners, lenders, etc.

05: Order materials in advance 

06: Include risk in your price, adjust contract language and determine who absorbs the additional costs with a letter of intent or limited notice to proceed