Document 99JwOV5L1rQRgRBBX45rxvRO3

November 1975 1976--The Care and Feeding of A Recovery The event was the 36th Building Products Executive Conference and a record-setting crowd packed into Washington's Statler Hilton to hear McGraw-Hill Chief Economist, George A. Christie, deliver the 1976 Dodge Sweet's Construction Outlook. There were no "good news--bad news" jokes although all the elements were there. The good news was that the eighteen-month downward slide in construction activity has "bottomed out" and a positive turnaround has begun. The. bad news was that the re covery appears to be a fragile one and in Christie's words "... without proper care and feeding, it could collapse." The overall tone of the predictions, however, was optimistic. In comparing post-recession 1971 with post recession 1976. Christie carefully noted the Dodge Index of Construc tion Contracts is presently at the same phase in the upswing cycle as it was in mid-1970. Thus. .. industry is again m the position to catch the construc tion market in a strong rebound." Whe" er or not the-1975 upturn will be th- -arbinger of peak construction for 19~i-77 that 1970 was for 1971-73. remains to be seen. While historically similar, today's outcome may differ for several reasons. Firstly, the downward construction cycle of 1970 ran for ap proximately three quarters, while the '75 downturn went for six. Secondly, the peak to trough decline in 1970 was about 25% in real terms. The 1975 de cline was more than 40%. Thirdly, the current cycle has been and will con tinue to be affected by the "energy crisis " Lastly and most importantly. Presi dent Ford's national economic policy will have far-ranging implications on the extent and rate of recovery. The Administration s primary concern has been in fighting inflation, not reces sion. Unfortunately.' tight money" fol lows on the coattails of such antimfiation strategy. Christie comn:e''!ed that ".. . unless there is some re a.<.ation of present monetary tightness, much of the potential for expansion of the construction industry in the year or two ahead will not be realized." Simply stated, construction cannot proceed without capital. But it is a political fact, not an economic one, that may well dictate stimulation of the economy... 1976 is an election year and politicians-may not want to go before the voters hold ing the proverbial empty bag. Continued on Page 4 AACPP to Exhibit in Miami Following in the footsteps of 1974's record turnout, the A'C Pipe Produc ers Association will again exhibit at the 1S'5 Annual Congress of Cities ExpoS'i-.on in Miami, November 30-December 2, 1975. The Exposition is sponsored by the National League of Cities, the "national action arm of the nation's cities." Its 15.000 mem bers include state municipal leagues, cities with a population of over 30,000, the ten largest cities in each state and all state capitals. A major objective of NLC is to assist policy leaders--mayors, councilmen, city managers and engineers--to do their jobs better and more efficiently. Last year a post-exhibition survey showed that 95% of the convention del egates attended the exhibit ha'I and 70% visited three or more times. Furthermore, two-thirds of the munic ipal officials actually followed up by forwarding information or recom mending purchases to others in city hall. Continued on Page 4 Volume 1, Number 1 Asbestos in Water--Where Are We? Though less publicized in 1975 than in 1974, the asbestos in drinking water question continues to be a focal point for Association activity. The absence of conclusive data to prove or dis prove the carcinogenicity of ingested asbestos still fans the flames of the controversy. But AACPP, in liaison with the fed eral regulatory community, is taking tangible, positive steps towards resol ution of the problem.'Let's review ex actly what is being done. EPA Pipe Test Loop One of the recommendations to come out of the AWWA "Study of the Problem of Asbetos in Water," under written by AACPP, was to determine how much, if any, asbestos fiber was added to water as it passed through A'C pipe. In early 1975, the Environ mental Protection Agency Laboratory in Cincinnati began a controlled ex periment to determine the effects of water aggressiveness, velocity and elapsed time on the release of asbes tos from A'C pipe. Through two sepa rate 90-foot loops of 4- and 6-inch CL 150 A'C pipe, pre-filtered water of known pH and hardness is being cir culated at 3.8 feet per second. 2.6 miles per hour, 433 miles per week. Water is being intermittently sam pled and analyzed by electron micro scopy to determine if asbestos fibers are released. If so. quantity and fiber size distribution by length and type are determined. After each six month run, the pipe is tapped to see if this causes a large release of fibers. As presently planned, the study will run 54 months, although it could be shortened if sam ples show no change. The startup of the loop provided an interesting anecdote when the first highly aggressive water attacked all the metallic components of the system and plated them out on the interior walls of the A'C pipe. The unspoken message in this case was eminently clear- such a water is too aggressive for any distribution system and the Continued on Page 3 CAP CO JEN 0010197 2 Pipe Report November 1975 Confidence, Cannibalism and Cast Iron In a mSntoroffdlaiss-fhe A/C Pipe Pro ducers Association will convene its Fall Meeting. If the meeting runte true to form, there will be much liscussion and speculation about what 1976 holds in store for the indus try. There is. of course, the economy: Will construction activity rebound in the second quarter as predicted? Then too. there is the continuing asbestos and health controversy: Is progress being made in resolving the ingestion question? Also, there is the persistent request for "high industry visibility": When will the Association mount a hardhitting promotional campaign? Other agenda topics range from re cent court interpretations of restrictive specifications and the renewed impor tance of salesmanship, to better defin ing what the real role of the Associa tion should be and how its activities can be of maximum benefit to the in dustry as a whole. Often overlooked in the midst of the chaos created by immediate prob lems. but of no less concern, is the real and often unspoken need to re store industry's confidence ... confi dence in itself, its people, its product, its future. The sackcloth and ashes at titude which shrouds today's real is sues and saps both individual and corporate initiative must be dispelled ... can be dispelled. The remedy is not all that difficult: one dose of pride in past accomplishments and continuing doses of increased sales and profits. Whatever else may come out of the meeting deliberations, one fact ought to be quite clear: 1976 will be a pivotal year for the industry. Pivotal in the truest sense. A turnabout year... for the economy, the health issue, the acuity of the industry, the effective ness of the Association. It must be a year which is characterized by a total industry commitment, not partisan dis interest, nor shortsighted can nibalism. A year when the admonition "lead, follow, or get the hell out of the way" must be the way of doing busi ness, not just an off the cuff quip. A year when leadership must not be ex ercised by demand and command, but distinguished by a universal attitude of what can I do to help?... at all levels of management, in all companies. The realities of the marketplace make one other fact equally evident. Even if the economy recovered over night and the health issue was re solved the following day, industry's potential for growth, both over the short and the long run, depends pri marily on one factor: its ability to seriously penetrate competitive pipe markets, ipso facto cast iron. For as Jack McOuff so succinctly put it at the Association's Annual Meeting .. ."They are the real enemy." Given the present fiscal climate in municipalities in the United States, there has never been a more oppor tune time to put "price and pride to gether again." In the final analysis all of the fancy rhetoric in the world will never sell a foot of pipe. Aggressive, knowledge able, enthusiastic salesmanship will! Connecticut, New York Fund Public Works Projects New York and Connecticut have ini tiated major environmental public works programs to spur employment in the hard-hit building and construc tion trades. The $2.7 billion effort in New York, funded from the Pure Waters and En vironmental Quality Bond Issues plus federal water pollution.allotments, will result in construction of 202 sewerage projects during the next five years. Under the program, 114 sewage treatment plants and 91 interceptor systems will be constructed. By the end of 1975. the state would initiate S1.1 billion in new project contracts while SI .6 billion would be earmarked for 1976. On a somewhat smaller scale, S15 million in bond funds was provided by the Connecticut Legislature. The funds would be used for more broadbased public works such as road re pair and park improvement, as well as the construction or repair of public sewers. Labor market areas with 7% or more unemployment (March, 1975) would be eligible. The Commissioners of Commerce and Labor will select projects from candidates submitted no later than October 1,1975. Industry Atlas As'bestos Company President George Barge announced the ap pointment of Nelson Bain as Vice President of Marketing. Mr. Bain joined Atlas in 1970 and was previously the company's General Sales Manager. Prior to joining Atlas, he was President of Asbestos Erectors of Canada Limited. Mr. Bain succeeds Leonard Falle who as Vice President will assume other corporate respon sibilities. Atlas operates plants in Montreal and Mission, British Columbia, and produces asbestos-cement water pipe, sewer pipe and building materi als as well as high temperature insula tion and reinforced plastic sheeting. -?#Convenlions November 4-5,1975 AACPP Fall Meeting Twin Bridges Marriott Washington, D.C. November 4-7,1975 ASCE National Convention and Ex hibition Denver Hilton Hotel Denver, Colorado November 30-December 2,1975 Annual Congress of Cities and Ex position Hotel Fontainebleau Miami Beach, Florida December 4-5,1975 Pollution Engineering and Equip ment Exposition and Conference International Hotel Los Angeles. California December 7-9,1975 AWWA Water Quality Technology Conference Sheraton Biltmore Hotel Atlanta, Georgia March 30-April 1,1976 WWEMA industrial Pollution Con ference and Exposition Shamrock Hilton Houston, Texas April 28-May 2,1976 NUCA Annual Convention Washington, D.C. Association of Asbestos-Cement Pipe Producers Suite 1113 1875 Connecticut Avenue. N.W. Washington, D.C. 20009 President. W R. Blankenship (Certain-feed Prod ucts Corporation Vice President: H. Taylor (Tne Flintkoie Company) Secretary R W. Smith (Johns-Manviiie Sales Cor* poration) Treasurer* t. L. Taylor (Cement Asbestos Products Company) Executive Director" Joseph C. Jackson Associate Director end Editor: John F Welch CAP CO JEN 0010198 3 Pipe Report November 1975 Members of AACPP's Sewer Pipe Task Group listen to Dr. Reynold Watkins (r.) explain the operation of a soil load cell. Shown are (I. to r.) Frank Duffy (Flintkote). Bill Perrell (CAPCO). Ed Spinzig (Johns-Manville). Al Leff (Certain-teed). Sewer Pipe Research Nears Completion Utah State University, under a grant from the A C Pipe Producers Associa tion. is completing research on the structural performance of buried asbestos-cement pipe. The test pro gram. conducted by Dr. Reynold Wat kins and Dr. Al Moser of the Engineer ing Experiment Station, will evaluate load factors as a function of A.-'C pipe stiffness and bedding conditions. Several classes and diameters of A/C non-pressure pipe were tested to failure in "soil load cell" and actual embankment conditions to substan tiate performance trends discovered in previous research. The "soil load cell" reproduces a trench burial con dition by applying earth loads hydraul ically to the buried pipe. The results of the Utah State work will be evaluated by AACPP's Sewer Pipe Task Group chaired by Mr. Al Leff of Certain-teed Products Corporation. Other members include Frank Duffy (Flintkote), Bill Perrell (CAPCO). Ed Spinzig (Johns-Manville) and Hugh Fraser (Canadian Johns-Manville). Asbestos (contd. from pg. 1) real answer is. therefore, in treatment. In selecting and classifying the nine test waters. EPA utilized the Modified Langlier Index method developed by AACPP. The pipe loop study is well under way and the Association hopes to be able to report soon on interim results. In another phase of the project. EPA is sampling cities where source waters low in asbestos are distributed through A C pipe prior to use. Analyses of the source and tap waters will demon strate if fiber content increases as it passes through the pipe. Sample sites include cities in Florida. Connecticut, Washington. Texas and Ohio. Prelimi nary results indicate that for waters where the Modified Langlier Indices falls within the guidelines recom mended by the industry and now in cluded in AWWA Specifications C-400 and C-402. asbestos fiber contribution is not statistically significant" or "below detectable limits." Nationwide Asbestos Sampling Program A nationwide sampling program, scheduled for 1976 completion, is also in progress to determine the environ mental background levels of asbestos resulting from discharge sources. Over sixty sites, including major city water supplies, natural sites of asbes tos rock formations, asbestos mining and manufacturing operations, are being sampled and analyzed for as bestos fiber content. NIEHS Feeding Study In an effort to define the car cinogenicity of orally ingested asbes tos. the National Institute of Environ mental Health Sciences (NIEHS) re cently contracted with Hazleton Laboratories of Vienna, Virginia, and Illinois Institute of Technology to con duct an extensive four-year feeding study. For a lifetime, thousands of rats and hamsters will be fed asbestos. The incidence of tumors will then be com pared against a control group and third group fed a known carcinogen. Whether or not this study will truly answer the asbestos ingestion ques tion remains to be seen. Dr; Paul Kotin, Chairman of AACPP's Medical Advisory Committee, points out that the project involves a single, high dose level of asbestos. Such an ap proach ignores what is called a "dose-response relationship"--that is. how much orally ingested asbestos is required to induce a tumor: a boxcar or a teaspoon? The Association is of the opinion that NIEHS is taking the boxcar approach and the multi-million dollar research may well raise more questions than it answers. Nonethe less, even at the high ingestion levels planned, the possibility exists that the results will be negative. EPA Epidemiology Study With information supplied by AACPP. its member companies and salesmen. EPA's Water Supply Re search Laboratory in Cincinnati is re searching the incidence and distribu tion of gastrointestinal (Gl) cancers in the State of Connecticut which was chosen for its excellent "tumor regis try." The study will compare cancer frequency in cities using A/C distribu tion systems versus those without A'C. It is obvious that any one or all of these studies could have significant impact on the A/C pipe industry. How ever altruistic it may sound, the AiC Pipe Industry through AACPP is firmly committed to governmental coopera tion and candor. Unlike our cities, it is our belief that it is more important to supply the answer, than to just raise the question. CAPCO JEN 0010199 4 Pipe Report November 1975 1976--The Care and Feeding of A Recovery (contd. from pg. 1) Residential Building Like other recoveries, the 1975 turn around started with an increase in single family housing starts. By the Third Quarter, one-family starts were at an annualized 900,000 unit mark. Further growth appears to hinge on the continued availability of mortage money in the face of a late 1975-early ISTB' "credit crunch." Multi-family housing starts hit bot tom in February and have been stag nant since. However, a three to six month tag between recovery in onefamily construction and apartment building is "normal." Compared with the 1970 apartment boom, construc tion costs have increased 50%, short term interest rates 50%. and long-term rates 30%. These and a 60% boost in fuel and electricity rates weighed against a 25% increase in rental rates, obviously tilt the profitability scales in an unfavorable direction. Christie concluded that 1976 resi dential building would be approxi mately 1.025.000 single-family homes and 500.000 apartments. This total will not match in numbers the 2.1 million mark of 1971, but will cost 15% more. Non-building Construction "Energy" and "public works" were the two big words in non-building construction statistics. S2 billion of Trans-Alaska Pipeline construction and S6 billion worth of electric power plant contracts made 1975 a banner year for utilities. Though stimulated by the release of several billion dollars of Nixonimpounded pollution control funds, the full potential of sewer and water facilities construction has not been realized. Christie noted. In most states, the complex EPA planning and b'ddmg procedures have been hur dled and "strong use in contracting is bound to follow" in 1976. 1976 fn A Nutshell Christie summarized by saying that the 1975 turnaround is underway and will accelerate as the economy reacts and industry goes through a "brief period of inventory build-up." The re covery may lag somewhat in the last quarter of 1975 and the first quarter of 1976. This "flat spot." the result of completed inventory adjustment and tight money high interest, should be followed by a sound 15% increase in overall construction activity in 1976. And McGraw-Hill isn't the only one optimistic about next year. Engineer ing News Record prognostications see an I8*a increase in construction activ ity. What About Pipe? McGraw-Hill estimates that the value of 1975 sewer and water con struct!. .-ontracts will be S6.7 billion. This is a preliminary estimate based on eight months of actual figures and four months predicted. The 1976 fore cast is $7.5 billion, a 12% increase over 1975. More housing starts, the continued availability of Federal Water Pollution Control Act and Safe Drink ing Water Act funds and a growing confidence that the recession is be hind us all indicate that 1976 will be somewhat better than 1975. Penetra tion of competitive pipe markets, as much as the overall economic/ construction climate, may well dictate whether or not 1976 will be a banner year... or just a modest one. Miami (contd. from pg. 1) The AACPP Exhibit received considerable-attention in 1974 and an un precedented amount of literature was distributed. Since less than 3% of the city officials at NLC attended other public works or water conventions, the Association feels strongly that par ticipation in the Annual Congress of Cities can create an "A/C awareness" in the minds of the important munici pal decision makers ... the decision makers that answer to the taxpayer... the decision makers that face fiscal constraints ... the decision makers that should need A;C pipe. Fiber Hike Planned In the wake of a 40% wage settle ment ending a seven-month strike in the asbestos mining industry, several Canadian asbestos producers an nounced increases in the price of as bestos fiber. Canadian Johns-Manville Co., As bestos Corporation. Lake Asbestos of Quebec, Ltd., United Asbestos Corp. and Cassier Asbestos Corp. have either put into effect or are consider ing 7-15% price increases by the first of the year. The move is considered by many as a "catch-up" to higher prices previously set by Canadian asbestos firms who were not affected by the strike. The Canadian Anti-inflation Board said that the price hike will be studied to insure that they comply with the government's price guidelines. If not, the companies could be forced to roll back the increases. OSHA Proposes New Asbestos Standard The OccupationaljSafety and Health Administration (OSHA) has proposed that the standard for occupational ex posure to asbestos be lowered to 0.5 fibers/cubic centimeter for an B-hour time weighted average. The present standard is 5 fibers/cc, time weighted average. A reduction to 2 fibers/cc would have become effective July 1. 1976. The proposed standard would apply to all workplaces where occupational exposure to asbestos is present ex cept the construction industry for which a separate revision will be promulgated. The Association is re viewing the proposed regulations and considering what courses of action to take before the deadline for com ments. Cities Survey Completed The Association, with the coopera tion of its member companies, has fi nally completed its survey of U.S. cities whose population exceeds 1,000 which specify, purchase or have in service A/C water pipe. The survey re sults wilt be used to launch a highly visible promotional campaign in early 1976. In addition, a cities directory is being prepared for distribution to member company sales personnel. The directory will include the com plete survey results and be accom panied by interpretive analyses. Target date for completion of the directory is January 1,1976. Letters to the Editor Let us hear from you! The AACPP Staff will welcome your sugges tions and constructive criticism on the content, impact and timeli ness of the PIPE REPORT. CAP CO JEN 0010200