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Welcome
Welcome to our fifth issue of 2026 of The Site Report – our construction law insights e-newsletter.
During the summer months, our firm is pleased to host a talented group of law students, who get the opportunity to research and write, shadow our attorneys, and learn about the practice of law in a firm setting. As young professionals still deeply involved in higher education, our Summer Associates will be contributing to our summer publications and sharing their perspectives as both students and future legal practitioners. Please join us in welcoming Jessica Blevins, Charlie Long, Allison Pauley, and Stefany Kaminski to The Site Report team for this summer edition.
Also, don’t forget to register for…
Spilman SuperVision Labor & Employment Symposium, Charleston, WV, June 18
2026 Workplace Masterclass: L&E Compliance, AI, & the Brave New Employment Landscape: A fast-moving, high-impact seminar for employers navigating the modern workplace. Join Spilman attorneys for our full-day SuperVision Symposium, designed to inspire your confidence in navigating complex employment decisions! This complimentary symposium is tailored for business owners, C-suite executives, HR professionals, and anyone who manages employees. Dive into a day of valuable insights on employment topics such as AI, investigations, litigation, immigration, labor law, accommodations, and much more. Spend the day with us and leave armed with strategies and solutions to tackle the ever-changing world of labor and employment law! Click here to learn more and register.
Thanks for reading.
Stephanie U. Eaton - Co-Chair, Construction Group and Editor, The Site Report
Julian E. Neiser - Co-Chair, Construction Group and Chair, Litigation Department
Jonathan A. Deasy - Assistant Editor, The Site Report
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“Though the change may result in a looser regulatory environment at the federal level, it also introduces a new layer of risk for contractors, according to attorneys.”
Why this is important: The Trump administration’s proposed repeal of the EPA’s 2009 Greenhouse Gas Endangerment Finding would eliminate the legal foundation for many federal greenhouse gas regulations, potentially reducing permitting burdens for large construction, industrial, and infrastructure projects. Attorneys interviewed by Construction Dive note that greenhouse gas emissions could be removed from Prevention of Significant Deterioration (PSD) permitting analyses, likely shortening review timelines and lowering compliance costs.
However, the repeal creates significant legal uncertainty. Environmental groups have already challenged the action, and a future court ruling or subsequent administration could restore the finding, exposing projects approved under a deregulated framework to changing compliance obligations. Attorneys warned that this regulatory instability may increase litigation risk and leave some projects in legal limbo.
The repeal does not affect state-level climate regulations, which remain in force in jurisdictions such as California and New York. As a result, developers and contractors operating across multiple states will still require jurisdiction-specific permitting analyses. If the repeal survives judicial review, it may also reduce opportunities for environmental groups to challenge projects based on greenhouse gas permitting requirements. --- Jason Wandling
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“Hyperscale developers are drawing electricians, HVAC specialists and project managers away from traditional builds, tightening labor supply and raising subcontractor pricing.”
Why this is important: Before the current data center boom, extensive labor commitments were required for commercial and public construction projects such as large manufacturing facilities, hospitals, university campus improvements, infrastructure renovations, utility generation facilities and mega commercial warehouses. While the demand for construction labor remains high for these commercial and public construction projects, the “newest kids on the block” – AI-driven data centers – are beginning to impact certain aspects of traditional commercial projects in certain geographic areas of the country. While this is not surprising in light of the billions of dollars flowing into AI-data center projects, the boom has led to what this article describes as a “two-tier construction economy.” What does that mean, and why is it important to non-data-center commercial and public owners with significant construction projects planned near areas of AI-data center development?
The “two-tier construction economy” refers to the current situation where trades needed to construct AI data centers – HVAC, electrical, welders and project managers – are offered higher wages than they may have made on “traditional” commercial and public projects. Naturally, the higher wages can draw some of these crucial tradespeople to the AI datacenter work and away from the “traditional” projects. In response, owners of hospitals, universities, infrastructure projects and the like facing this competition may have to raise wages or scout for subcontractors farther away from their project sites to secure sufficient manpower. Having a workforce more remotely located from the job site can impact construction schedules, require remote housing near the site, and mandate changes to supply sourcing, among other things.
Owners on “traditional” commercial and public projects need to consider impacts of AI data center construction near in time and location to their planned projects. This is particularly true in areas most affected by AI infrastructure growth – Northern Virginia, Ohio, Texas and Arizona. Among other planning factors, owners should consider pre-construction labor market analyses; conduct outreach with required contractors and key subcontractors to secure commitments; consider alternative, less impacted construction sites if possible; evaluate earlier procurement and storage of necessary materials; develop contracts with larger contingency allocations; and evaluate project costs that account for potentially more remote workers. Finally, to the extent necessary and reasonable, outreach to the AI data center owner regarding its project schedule can assist with a more collaborative and workable planning process that facilitates construction of both the data center and the “traditional” project in a timely manner. --- Stephanie U. Eaton
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“Hill County commissioners have voted to temporarily halt new data center construction in unincorporated parts of the county, marking a significant escalation in the debate over digital infrastructure growth in rural Texas.”
Why this is important: As the demand for data centers continues to grow, rural communities are increasingly being asked to accommodate large-scale facilities that place significant demand on local resources. Regulating data center development is important because these facilities consume substantial amounts of electricity and water. Effective regulations help ensure that economic benefits from technological growth are balanced with environmental sustainability and the host community’s needs. For construction owners and developers, moratoriums such as these highlight the importance of closely monitoring evolving laws and regulations to ensure that projects remain compliant and aligned with community expectations. --- Jessica Blevins, Summer Associate
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“Ohio has about 200 data centers, the fifth-highest state in the country.”
Why this is important: It’s official – Ohio lawmakers have formed a bipartisan data center committee that will bring together workers, companies, and residents to testify on the impacts of data centers in Ohio. Companies are especially eager to have the opportunity to address concerns.
Data centers are on the rise throughout the United States. The electricity used by data centers is expected to rise to 9 percent of all U.S. electricity by 2030. This is unsurprising, as a large data center can use as much electricity as 100,000 homes. Furthermore, Ohio is on the cutting edge of the data center boom, as the state has about 200 data centers, making it the fifth-highest state in the country.
The rise of data centers has not been without pushback – a group of Ohioans is trying to get a data center ban on the state’s November ballot. Additionally, 11 other states have introduced legislation to temporarily ban data centers. However, given Ohio’s data center prevalence, other states may soon follow suit with similar bipartisan committee arrangements. --- Charlie C. Long, Summer Associate
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“New research now points in the opposite direction, raising serious questions about the economic cost of the administration’s policy and its effect on industries already dealing with labor shortages.”
Why this is important: A recent National Bureau of Economic Research (NBER) study challenges the premise that increased immigration enforcement benefits U.S.-born workers by freeing up jobs previously held by undocumented immigrants. Using federal employment data and regional ICE enforcement patterns, researchers found that areas experiencing significant increases in immigration enforcement saw employment among likely undocumented workers decline by approximately 4 percent. More notably, employment among U.S.-born men without college degrees also fell by 1.3 percent, with a roughly 3 percent decline in the construction sector.
The study found no evidence that employers responded by increasing wages sufficiently to attract replacement workers. Instead, businesses often reduced production, delayed projects, accepted fewer contracts, or slowed hiring. Researchers concluded that immigrant and native-born workers frequently function as complements rather than substitutes, particularly in labor-intensive industries such as construction, agriculture, manufacturing, and wholesale trade.
For the construction industry, the findings are especially significant. Employment among undocumented construction workers reportedly fell by 7.5 percent, while employment among U.S.-born men without college degrees declined by approximately 3 percent. The study suggests that labor shortages can disrupt entire project teams, affecting electricians, plumbers, supervisors, suppliers, and other workers whose employment depends on coordinated construction activity.
The research also raises concerns about broader economic consequences, including reduced housing production. Federal data indicate that residential building permits have already declined year-over-year, and further labor shortages could contribute to project delays, higher construction costs, and continued pressure on housing affordability. The findings contradict the Trump administration’s argument that mass deportations increase employment opportunities for American workers. Instead, the study suggests that aggressive immigration enforcement may reduce overall employment and economic activity in sectors heavily dependent on immigrant labor, creating potential downstream effects for employers, consumers, and local economies. --- Jason Wandling
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“Demand for heavy lifting workers is expected to rise as the industry grows and companies work to replace retiring operators across construction, mining and energy projects.”
Why this is important: The global heavy lifting market is projected to exceed $44.6 billion by 2034, driving increased demand for skilled labor across construction, infrastructure, mining, and energy sectors. Industry forecasts indicate construction employers must expand their workforce by 3-5 percent annually while also replacing a significant number of retiring workers. In the United States, the Associated Builders and Contractors estimates that more than 456,000 new workers will be needed by 2027, while McKinsey projects that approximately 41 percent of the construction workforce may retire by 2031.
Labor demand is expected to be particularly strong in offshore wind, civil infrastructure, and mining projects. In response, industry leaders are investing in workforce development initiatives, including partnerships with technical schools and specialized training programs. Heavy lifting company Sarens, for example, has expanded recruitment and training efforts through dedicated training centers in Belgium and South Africa. Although AI is expected to influence project planning and operational support, experts believe heavy lifting occupations are relatively insulated from automation because they require hands-on work in complex and variable field conditions. As a result, workforce shortages, rather than technological displacement, are expected to remain the primary labor challenge facing the sector. --- Jason Wandling
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“But it should raise concerns for residential property insurance companies because more construction projects are likely to be done by unlicensed firms and work will not be inspected, one longtime roofing contractor said.”
Why this is important: House Bill 803 creates, amongst other things, an exemption for homeowners or their contractors to be able to perform work on the owner’s property without first obtaining a building permit, so long as the work is valued at $7,500 or less. Proponents believe the exemption is calculated to speed up the construction process for small, minor projects. However, opponents of the bill are concerned that the exemption will increase the likelihood that these minor projects will be completed by unlicensed firms and that the work will go uninspected.
A closer look at House Bill 803 can assuage some of the concerns regarding the potential for unlicensed or uninspected work. The exemption from having to obtain a building permit does not apply to electrical, plumbing, structural, mechanical, or gas work, nor does it apply to property located in flood hazard areas. These limitations show that the exemption is truly intended for small-scale projects, like installing a fence or building a shed, and is not intended for more major, and objectively more dangerous, projects that could have serious ramifications if done by an unqualified individual.
Additionally, for residents to qualify for this exemption, they must submit a written request for exemption that includes documentation outlining the nature of the work and the value of the work to be performed. This indicates that records will be kept of each qualifying construction project that proceeds without a building permit. Florida would then be able to monitor the projects that were completed under the exemption for future issues or defects, and would be able to amend the bill in the future as needed to address such issues.
Overall, House Bill 803 marks a change in Florida. The impact of the bill will remain unknown until it has been in effect for a sufficient period of time to determine if the legislature’s intent came to fruition or if the fears of the bill’s opponents came true. The public will just have to wait and see. --- Allison D. Pauley, Summer Associate
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“The state’s more than 2,600 municipalities each have different zoning rules and permitting requirements, adding to a process that put Pennsylvania near the bottom of a national ranking for new homes built between 2017 and 2023.”
Why this is important: Pennsylvania’s patchwork of zoning rules and permitting requirements, which vary across the state’s 2,600 municipalities, is slowing down residential construction. Republican lawmakers in the State Legislature want to change that, and they are looking for ways to streamline those processes. One successful stormwater permit review program provides a framework, cutting down the approval process for a certain type of permit to only 51 days (including 30 days for public comment). But for now, anyone planning residential construction in Pennsylvania should still be cognizant of unique local requirements—which could require approvals from nearly a dozen regulatory bodies—and build in sufficient flexibility for lengthy permit review timelines. --- Jamie L. Martines
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“The governor says North Carolina could be more than 750,000 homes short by 2029 as more people continue moving into the state.”
Why this is important: As North Carolina’s projected housing shortage of 750,000 homes by 2029 has come to a head, there is a pressing need for increased construction opportunities throughout the state. Governor Stein’s Executive Order No. 36 attempts to address this problem by directing state agencies to coordinate housing efforts, work with local governments and private developers, and find new ways to streamline development. This Order also directs agencies to access and use technology to drive these housing solutions. Most importantly, it aims to focus specifically on affordable housing options that allow teachers, police officers, and other civic servants and essential workers to afford homes in their communities. By directing cabinet leaders in North Carolina to work together to increase accessibility to affordable homes and removing red tape that can stunt construction, Stein’s Order addresses home purchasing and affordability for the essential members of the community. Currently, 53 percent of enlisted families in North Carolina spend more than 30 percent of their monthly income on housing and utilities. Even further, teachers in 23 counties did not earn enough on average in 2025 to afford the average fair market rent in the very same community in which they work.
Additionally, this Executive Order plans to create career opportunities by expanding housing initiatives, in part through the appointment of Janneke Ratcliffe as the Senior Advisor for Housing Policy. The Order also intends to increase qualified labor through the increase of construction jobs to reduce premium pricing on construction.
This Order outlines utilizing community efforts to help solve the projected housing crisis. Government agencies will collaborate with private, nonprofit, philanthropic, academic, and faith communities to help identify and drive the housing solutions. The Order also provides grants to local governments to incentivize higher-density zoning policies that will increase and diversify housing supply. --- Stefany A. Kaminski, Summer Associate
| | Featured Attorney Question & Answer | | |
Steven C. Hemric
Member
Office 336.631.1063
shemric@spilmanlaw.com
Q: As an incoming officer of the North Carolina Bar Association's Construction Law Section, can you speak to the relevance of organizations such as the NCBA?
A: I have been involved with both local and national organizations like the NCBA and American Bar Association my entire career, and it would be hard to list all of the reasons for and benefits I have received from those associations. One large benefit is the value added for my clients. The educational content keeps me on the forefront of the field, and the connections I have made with other attorneys have enabled me to work more effectively with those attorneys as opposing counsel and to connect clients with assistance when I have not been able to represent them (such as when I have had an ethical conflict or the client has needed help in a state in which Spilman does not have any attorneys licensed). I could rattle off a laundry list of contract negotiations, change order disputes, and large delay and payment claims that I have been able to resolve much more efficiently for clients precisely because I was able to pick up the phone and call a friend from the NCBA Construction Law Section who popped up as opposing counsel. Those types of direct benefits to my clients are reason enough to be involved with the NCBA and ABA, but I could also go on about the benefits I have received from the mentoring, thought leadership, and personal friendships of which I have been able to be a part because of organizations like the NCBA and ABA.
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