IS CONSTRUCTION ESSENTIAL UNDER STAY AT HOME ORDERS?
With the entire State of North Carolina entering a Stay at Home Order, only Essential Business will continue. Is Construction Essential?
On March 27, 2020, Governor Roy Cooper issued a Stay at Home Order for the entire State of North Carolina (Executive Order No. 121, “State Order” or “E.O.”). The Order takes effect in all 100 counties on March 30, 2020 at 5:00 P.M. for thirty (30) days. One of the areas that merits more specific discussion in the Stay at Home Orders is Construction.
As a preliminary matter, it is important to review both the State Order and any local directives. Cities and counties have enacted ordinances and issued state of emergency declarations based on the more significant spread of the virus in urban areas. The State Order directs that it is not intended to limit or prohibit counties and cities in North Carolina from enacting ordinances and issuing state of emergency declarations which impose greater restrictions or prohibitions to the extent authorized under North Carolina law.” E.O. 121, at §5. At this point, it is unclear how the varying definitions and text of these local orders will interact with the State Order.
The State Order (and all local orders) require “non-essential business and operations must cease.” E.O. 121, at §2(A). Unless a business is defined as a “COVID-19 Essential Business and Operation,” it is required to cease all activities within the State except Minimum Basic Operations. E.O. 121, at §2(A). See also E.O. 121, at §2(G). We described the general effect of the Order in a prior post, which can be found here.
Certain construction is essential critical infrastructure workforce as defined by CISA (the Cybersecurity & Infrastructure Security Agency within the Department of Homeland Security) (link), which is the basis of devising the definition of Essential Businesses followed by the State Order and local declarations. See E.O. 121, at §2(C)(2). Our friends at Levelset have an excellent analysis of critical construction on a national level.
The definition of that essential critical construction varies widely across the State of North Carolina.
Construction as a Critical Trade
The maintenance of homes and businesses is critical even in a crisis. Therefore, the State Order includes “Building and construction tradesmen and tradeswomen” as essential businesses. See E.O. 121, at §2(C)(15). This includes
Plumbers
Electricians
Exterminators
Cleaning and janitorial staff for commercial and governmental properties
Security staff
Operating engineers,
HVAC
Painting
Cleaning services
Moving and relocation services
Landscaping
and other service providers who provide services that are necessary to maintaining the safety, sanitation, and essential operation of residences and COVID-19 Essential Businesses and Operations.
This list is not intended to be exclusive and the “other service providers” clause is subject to a a range of different interpretations.
Several local lists of permitted trades are similar to the state list. The Mecklenburg Proclamation (link), City of Durham (link), Orange County (link), Cabarrus County (link), Gaston County (link), Guilford County (link), Henderson County (link), Haywood County (link), Swain County (link), the Village of Clemmons (link) and Winston-Salem (link)/ Forsyth County (link)/ Town of Kernersville (link) mirror the state list but exclude “cleaning services” and “landscaping.”
Dare County (link) and Buncombe County (link) are narrower and list “Plumbers, electricians, exterminators, and other service providers who provide services that are necessary to maintaining the safety, sanitation, and essential operations of residences and Essential Businesses.” Wake County (link) contains a similarly narrow list.
The Town of Beaufort (link) and Pitt County (link) are the most restrictive proclaiming critical trades are an essential businesses but only when working: “Plumbers, electricians, exterminators, and other service providers only while providing services that are necessary to maintaining safety and sanitation.”
Madison County (link) does not contain any specific reference to construction as a critical trade.
Construction as Essential Infrastructure Operations
The State Order does not limit Construction to maintenance alone. Construction is included in another section listing businesses that are Essential Infrastructure Operations. By way of example, it specifically allows as essential business
construction required in response to this public health emergency, hospital construction, construction of long-term care facilities, public works construction, school construction, and essential commercial and housing construction.
See E.O. 121, at §2(C)(5).
What construction is essential? First, the Order does not define essential commercial and housing construction. It does not seem to relate to COVID-19 Essential Business and Operations, where the term “Essential” in that context is always capitalized in the order. This question is somewhat tempered by the fact that the “Essential construction” is not limited to this list of COVID-19 related construction and public construction projects. The Order says that Construction “includes but is not limited to” that defined list. Additonal regulatory guidance may be forthcoming.
The State Order specifically provides that local orders remain in effect and the strictest restriction applies. The local orders remain a patch work of definitions regarding construction as part of Essential Infrastructure.
Mecklenburg’s Proclamation (link) has a non-exclusive definition which specifically references residential construction. It defines essential construction as
including, but not limited to, construction required in response to this public health emergency, hospital construction, construction of long-term care facilities, public works construction, andhousing construction
Identical language is used in Cabarrus County (link), Haywood County (link), Swain County (link), and Winston-Salem (link)/ Forsyth County (link)/ Town of Kernersville (link).
Guilford County (link) defines essential construction as
including, but not limited to, construction required in response to this public health emergency, hospital construction, construction of long-term care facilities, public works construction, commercial construction and residential construction.
Gaston’s language (link) is unique defining construction as
including, but not limited to, construction or clearing required in response to this public health emergency or to eliminate some other imminent threat to a person's health or safety, hospital construction, construction of long-term care facilities, public works construction, and housing construction.
Buncombe County’s “Stay Home, Stay Safe Supplemental Declaration” (link) allows construction as “public works construction, residential and commercial construction,” in Section 9(b)(iii). Identical language is used in Dare County (link) at Section 6(b)(iii) and in Madison County (link).
Wake County’s Proclamation (link) at Section 10(c) is even more expansive than the State Order allowing “Commercial and residential construction professions and trades, including but not limited to contractors, engineers, architects, surveyors, suppliers, and manufacturers, repairs and renovation specialists.” The Wake Proclamation further allows “essential infrastructure construction, construction of housing (in particular affordable housing or housing for individuals experiencing homelessness).”
The City of Durham references construction in its Declaration (link) not as an Essential Infrastructure Operation but as an allowed outdoor business and services:
Until otherwise ordered, those businesses that operate primarily outdoors or in structures under construction (e.g., construction related contractors, lawn maintenance, equipment repair or maintenance, etc.), and that consistently practice Social Distancing Requirements, are permitted to operate as if they were an Essential Business.
Orange County (link) and Henderson County (link) use the same language in their Declarations.
The coastal town of Beaufort (link) and Pitt County (link) in the coastal plain use similar language at §2.2 of their Declaration replacing “equipment repair or maintenance” with “boat repair or maintenance.” interestingly, the Village of Clemmons (link) located 241 miles from the coast also specifically allows boat maintenance.
Conclusion
In conclusion, Construction rules will vary by jurisdiction within North Carolina. Nearly all construction activities which maintain or repair existing structures are allowed in every jurisdiction in North Carolina. The exceptions are landscaping and cleaning services, which are allowed across the state, except where restricted by a stricter local order.
Construction of new properties is universally allowed where the construction is “required in response to this public health emergency,” or is “hospital construction, construction of long-term care facilities, [or] public works construction.” The state specifically allows for “essential commercial and housing construction” without defining “essential.” A majority of localities specifically allow residential construction (Mecklenburg, Wake, Buncombe, Guilford, Forsyth, Cabarrus, Gaston, Dare, Haywood, Madison and Swain Counties). A few specifically allow all commercial construction (Buncombe, Dare, Madison). Meanwhile, other Counties allow Construction generally as an outdoor activity “in structures primarily under construction” (City of Durham, Town of Beaufort, Pitt County, Orange County, and Henderson County).
The current environment is extraordinarily difficult for construction industry. Eric H. Biesecker from Greensboro wrote an article for the North Carolina Bar Association identifying a number of other construction law issues facing owners, contractors, subcontractors, and suppliers grappling with the impacts of the virus. (link)
If you have questions about the effects of this crisis on the Construction Industry, contact Allen Stahl + Kilbourne
By James Kilbourne and Derek Allen
Updated: March 28, 2020
Any statements contained herein do not constitute a formal legal opinion and should not be relied upon as such. These articles are intended for general informational purposes only. Nothing expressed shall be grounds for the creation of an attorney-client relationship. Our attorneys can give legal advice only in the context of an attorney-client relationship after a conflict check, the execution of a representation agreement and a discussion of the specific information and unique issues of your particular circumstances.
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