DCA History: The 80s – Riding the Roller Coaster

As the calendar turned another page at the end of the 70s, most Americans were happy to wave goodbye to the old decade.  A lost war, presidential corruption, economic malaise, and eye-watering fashion choices were easy to leave behind, even if the music was epic.  While oil had languished for years under the Carter administration, however, the gas industry was flying high.  Oil-to-gas conversions were occurring at a record pace in both residential and commercial markets as demand for gas rose during the oil crunch.  The DCA had grown steadily throughout the decade and eagerly looked forward to more of the same.

Their optimism was understandable as Ronald Reagan waltzed into the Oval Office with a twinkle in his eye, but the new decade would not be without its challenges.  What goes up must come down, and dark clouds would soon be gathering as DCA approached drinking age and new problems arose to fill the void left by the old ones. For now though, disco was dead, big hair was in, and the party was on.

Topping the Hill
As DCA members prepared to attend the 1980 convention, the bitter end of the 70s was still playing out.  Jimmy Carter was still in office as election season kicked into high gear, six U.S. diplomats escaped from Iran after their colleagues were taken hostage, the Soviets invaded Afghanistan, and America  decided to boycott the Moscow Olympics in protest. Over 350 DCA members and family made their way to the Doral Beach Resort in Miami, where outgoing president Gene Spencer observed that available work was at a high not seen in years, but that interest rates, fuel and labor costs due to shortages of both, and equipment prices were all driving up operating costs. Keynote speaker Charlie Ingram, chairman of the American Gas Association (AGA), predicted that the gas utility industry’s construction budget for transmission and distribution would double in the next several years to over $5 billion annually.  Roundtable discussions centered on controlling fuel costs, recruiting new supervisory personnel, and preventing equipment theft. Tom Poole of Hallen Construction took over as the 19th DCA president and almost immediately began planning for the 20th annual convention.  Later in the year, DCA would be invited to join the World Confederation of Pipe Line Contractors Associations.
By the time of the 20th convention in February 1981, Ronald Reagan had taken office, the Iranian hostages had been released, and the world still mourned the murder of John Lennon.  At the Mountain Shadows Resort in Scottsdale, Arizona, 17 of the past 19 DCA presidents were in attendance for the big anniversary, which saw Dale Miller take the office in front of the second-largest crowd at any DCA convention to date at 411.  Nick Humy from Caterpillar gave an enlightening presentation on how to motivate workers, alleviate their fears, and improve communication. Gas construction spending still looked strong at the start of the year; Seagull Pipeline in Houston raised its capital budget from $11 million in 1980 to $40 million in 1981, with more than $25 million budgeted for new gas and petrochemical lines and $12 million for construction of gas processing plants.

Facing the Plunge
Although the country had technically been in recession since January 1980, the construction industry had largely dodged the first bullet. In the third quarter of 1981, however, rising interest rates to combat inflation caught up with them. The housing market slowed severely as the recession slid into a “double-dip,” causing demand for new pipelines to supply those unbuilt houses to dry up. The 1982 DCA convention returned to Doral Beach Resort in Miami, and Dale Miller could sense that members were feeling the pain. Though he praised the association for its success in negotiating labor agreements, he also pointed out areas where there was room for improvement, such as wage rates tied to agreements unrelated to distribution work.  “We must keep our costs at the very minimum or gas will lose its place as the most economical fuel,” he warned. He remained confident that the economic pain would be brief, however, and that the next 20 years would be a time of growth for the industry.  The convention concluded with Bill Snelson as the new DCA president.  Although the economy remained weak throughout 1982, the association still managed to add five new members that year in a hopeful sign that they had weathered the worst.

Unfortunately, 1983 would not be any better.  DCA gathered at the Hotel del Coronado in San Diego just as Michael Jackson’s “Thriller” album was rocketing to #1 and the nation awaited the final episode of “M*A*S*H” with bated breath.  Attendance was down a bit to 330 as Snelson handed the reins to Jim Miller. Some members reported being forced to diversify into other types of construction in order to stay afloat.  John Abrams, chairman and CEO of Southern California Gas, the largest distribution company in the U.S. at that time, offered some hope in his address to the convention by announcing the company’s intention to expand its use of contractors and increase its budget for replacing existing service lines.  Abrams went on to examine how the Natural Gas Policy Act of 1978 had largely resolved the gas supply shortages of the 70s, but still managed to result in higher gas prices.  Not all the news that year was grim, however, as DCA successfully renegotiated its agreements with all three craft associations, generally lowering wage rates and helping to protect members from non-union competition.

As the 1984 Winter Olympics drew to a close in Sarajevo, the DCA “survivors” of 1983, as Jim Miller called them, arrived in Scottsdale, Arizona for the 23rd annual convention.  For a change, the housing market was on the upswing, natural gas prices had stabilized, and an unusually cold winter meant that the utilities were making money again, so hopes for a rebound year were high.  As Jim Donaldson took over the presidency, the DCA presented the first ever Arthur T. Everham Safety Award to the Snelson Companies for the best all-around safety record in 1983.  Despite the reduced attendance of 280, the association still announced the addition of seven new members over the previous, largely “dismal,” year.

Climbing Out of the Hole
Things were really starting to look up in 1985, with the country seeming to be in a good mood.  Reagan won reelection in a landslide, Joe Montana was the Super Bowl champ over Dan Marino, and Madonna was queen of the charts with “Like a Virgin.”  The star-studded iconic mega-hit “We Are the World,” recorded at the Grammys, was just weeks away from release.  Distribution contractors gathering in San Antonio that February reported a mixed year, with some regions faring better than others, but it still beat “dismal.” Contractors who expanded their geographic market areas came into competition with others who had done the same, depressing prices.  Widely fluctuating interest and inflation rates continued to cause trouble, and blanket contracts that assumed all construction jobs are the same regardless of ground conditions were a sore spot at this convention.  Jerry Stubbs of Mid-Mountain Contractors in Bellevue, Washington, became the 24th president of the DCA.

DCA marked its first quarter century in 1986 under beautiful weather in Palm Springs, and delegates had no shortage of conversation material. Halley’s Comet still lit up the night sky while “Da Bears” celebrated with the Super Bowl Shuffle, the nation mourned the loss of the space shuttle Challenger, and dictators “Baby Doc” Duvalier in Haiti and Ferdinand Marcos in the Philippines were deposed and fled their countries within weeks of each other. Most contractors reported a good year in 1986, relieving five long years of struggle and uncertainty for the industry. Convention attendance swung back up to 300, with more regular (contractor) members attending than any previous convention and outstanding turnout for business functions.  Darold Falldorf of Aconite Corp. was elected DCA president.  

Palm Springs was such a hit that DCA came back in 1987 for the 26th annual convention and equaled the previous year’s attendance.  Bob Cooley of Distribution Construction Co. took his turn in the top job at DCA amid a crowd who felt like a weight had been lifted off their backs.  Executive Director Jim Upton attributed success in the distribution business to a combination of “luck, energy, raw intelligence, honesty and integrity, and a gambling spirit.” Jurisdictional disputes among unions over the laying of plastic pipe clouded the horizon but didn’t dampen the mood.  Meanwhile, the Iran-Contra hearings and the Unabomber dominated the news, Liberace died of AIDS, and everybody was walking like an Egyptian.

Back in the Saddle Again
The Cold War looked like it was starting to thaw after Ronald Reagan and Mikhail Gorbachev exchanged Christmas greetings in 1987, and by mid-February 1988 the Soviets admitted defeat in Afghanistan, withdrawing completely.  Manuel Noriega was indicted in Florida, Jimmy Swaggart cried on TV, and the Chicago Cubs finally decided to play under the lights at Wrigley Field. Back at Mountain Shadows in Scottsdale again, keynote speaker James Dolan, AGA chairman and CEO of New Jersey Resources Corporation (NJR), told the assembled crowd that the gas bubble was over and gas prices would start tracking inflation. NJR used contractors for all of its construction and maintenance; it had added 16,000 customers during the previous year and expected 80,000 more over the next five.  As Larry Smith of Carl E. Smith, Inc. took over the presidency, the DCA and the nation seemed to be riding high once again.

In 1989 the DCA finally made it to Disney World for the national convention, and attendance climbed back up to 390.  Larry Smith was feeling optimistic as he told the members, “Natural Gas is rapidly becoming the energy medium to solve the problems of air pollution, acid rain, the greenhouse effect, security risks, nuclear power and the need to a rapid increase in electrical generation.”  Natural gas had become the fuel of choice in the U.S. and future legislation seemed likely to limit the use of competing fuels.  He cautioned that continuing low prices would have to rise in order to encourage new drilling, but expressed hope that current demand would last well into the future.  Joe Van Gundy, Jr. of Waterman Construction Co. took over to close out the decade as DCA president while Ronald Reagan was bidding his farewell to the nation and handing over the Cold War for George H. W. Bush to finally put to bed for good.

In all, it can’t be said that the 80s was DCA’s best decade, but progress continued to be made on the labor front, and those who survived the wild economic ride came out in a stronger position than the industry had ever seen before with public opinion strongly in favor of natural gas.  As they rolled into the 90s, you could say the DCA was doin’ alright, makin’ good grades, with a future so bright, they had to wear shades.