On-Site AUG 2015

AUGUST 2015

> IN SIDE < C

BILLION DOLLAR BABIES

INVENTORY OF SUPER-MEGAPROJECTS REACHES NEW HEIGHTS AERIAL WORK PLATFORMS REACH FOR THE TOP

TRANSIT $34 BILLION

LAW

CHANGES COMING TO THE BUILDERS LIEN ACT PG.54

ONCR ON-S ETE IT E PG.4 1

HYDRO $60 BILLION

INFRASTRUCTURE

AHEAD

ROADS & BRIDGES $32 BILLION

RISK

WHO SHOULD PLACE PROJECT INSURANCES? PG.53

BUILDING $18 BILLION www.on-sitemag.com

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VOLUME 59, NO.5 / AUGUST 2015

COVER STORY 21 Billion-dollar babies Canadaâ&#x20AC;&#x2122;s roster of billion-dollarplus construction projects seems to be growing constantly. We take a look at the effect this is having on the industry.

21 29

DEPARTMENTS 4 Comment

Megaprojects: a team sport

8

News

Industry news

18 Construction Stats The latest news on construction activity and construction employment

COLUMNS 45 Risk Who should place project insurances?

46 Contractors and the Law Changes coming to the Builders Lien Act

35 Concrete On-Site What you need to know about fivesection double-Z booms

features

24

44

Index of Advertisers

24

29 AWPs reach for the top

A brief look at a sampling of Canadaâ&#x20AC;&#x2122;s biggest megaprojects

New designs and marketing innovation bring aerial work platform technology roaring back from the recession

Big deals

on-sitemag.com / 3

EDITORIAL

Megaprojects: a team sport

T

Get the latest construction news!

Follow us on Twitter @OnSiteMag

4 / AUGUST 2015

he steady procession of billion-dollar projects rolling down the Canadian construction pipeline these days has to give one pause for thought. How are the contractors who bid on these jobs different from the rest of us? What special tactics do they use in approaching them?

You might find that they are not as different as you think (apart from the balance sheet, of course!)

Certainly, the level of risk they get involved with takes you up into nosebleed territory. That means that the science of allocating risk has to be followed strictly. With at least a decade of history, “There’s a lot more clarity around how risks are being allocated,” noted David Bowcott of AON Reed Stenhouse Inc., in Toronto. “It’s scary how serious some of these risks are.”

Partnering is one part of the solution. The large firms have become adept at managing and allocating risk. “People are definitely getting a lot better at picking their partners,” says Bowcott. “The joint-venture agreements are getting more sophisticated and there is clear allocation of risk. The person best able to manage a risk is given that risk.”

The evidence seems to argue in his favour.

When you look for catastrophic failures in the P3 arena in Canada, you don’t find too many lately.

But there’s another element besides picking good partners. Owners are looking for firms that have invested in internal departments to help manage risk.

In many cases, those teams didn’t exist 20 years ago. Even at larger contracting firms, they often didn’t have legal, risk-management, business development, QA/QC department or even an HR department. Today, they are common, notes Bowcott.

The benefits of these teams are many. The knowledge gained from each job is retained in the company by the team, instead of walking out the door when an experienced project manager

decides to retire. The benefit goes way beyond managing each management task effectively.

“The beauty of it is that these departments can connect as vehicles to gather information – collective intelligence, he says. They have a stronger sense of what is possible when they are looking at big deals.

It’s hard to believe that a contractor any size would not have a strong QC/QA team, but we see it over and over. There have been more than a few notorious cases recently where obvious errors were made in construction. “The bigger contractors have a whole QA/QC team that does nothing but make sure they don’t make those catastrophic mistakes,” notes Bowcott.

The team approach is something the market is looking for.

Companies with these teams are comfortable taking on high levels of risk, “while the mid-sized firms are still struggling to figure out how to aggregate the knowledge of those risks that they have taken on,” says Bowcott. “A mid-sized contractor usually doesn’t have that kind of team. They rely on their project managers to handle the job. A lot of those contracting firms are being passed by because they haven’t figured out how to manage some of those risks or how to partner with other mid-sized firms on big jobs.”

So do teams make a contractor bulletproof?

Not really. “The best contractors are the ones who say, ‘I wish everyone could see the work I’m doing and tell me what I’m doing wrong,’” says Bowcott. They welcome scrutiny. They want to find out about any mistakes they might make up front – rather than afterwards, when things start to get litigious.

The market seems to be pushing contractors toward more transparency and less ego.

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CONTRIBUTORS

MEET OUR CONTRIBUTORS FOR THIS ISSUE JIM BARNES / Contributing Editor, On-Site On Billion-Dollar Babies: Ten years ago, to see a billion-dollar project coming down the pipeline was extraordinary. Just a decade later, these billion-dollar babies seem to be commonplace. How are contractors adapting?

www.on-sitemag.com / Fax: 416-510-5140

PUBLISHER | Peter Leonard (416) 510-6847 PLeonard@on-sitemag.com EDITOR/EDITORIAL DIRECTOR | Corinne Lynds (416) 510-6821 CLynds@on-sitemag.com (on mat-leave) CONTRIBUTING EDITOR | James A. Barnes ART DIRECTOR | Mark Ryan (416) 442-5600 x3541 MRyan@annexnewcom.ca ASSOCIATE PUBLISHER | David Skene (416) 510-6884 DSkene@on-sitemag.com SALES & MARKETING COORDINATOR | Kim Rossiter (416) 510-6794 KRossiter@annexbizmedia.com PRODUCTION MANAGER | Steve Hofmann 416-510-6757 SHofmann@annexnewcom.ca

DAVID BOWCOTT / Senior vice-president, national director Large/Strategic Accounts, Construction and Infrastructure Services, Aon On Who Should Place Project Insurances?

Who’s the best party to place project-specific insurance policies… the owner or the builder?

DAVID GODKIN / Contributing freelance writer & editor On AWPs Reach for the Top: Aerial-work platform manufactures came roaring back from the recession thanks to a mix of product innovation and market development.

KIM CRAWFORD / BCRMCA On Productivity booms on new pump trucks: New boom configurations help deal with congested, awkward jobsite spaces

CIRCULATION MANAGER | Selina Rahaman (416) 442-5600 x3528 SRahaman@annexnewcom.ca Published by Annex Business Media 80 Valleybrook Drive, North York, ON M3B 2S9 Vice President Annex Business Media East | Tim Dimopoulos (416) 510-5100 tdimopoulos@annexbizmedia.com President & CEO Mike Fredericks mfredericks@annexweb.com

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LAUREN E. KRISTJANSON AND ALEXANDER BJORNSON / lawyers, Borden Ladner Gervais LLP On Changes coming to the Builders Lien Act: “One of the issues expected to be dealt with in the new iteration of the Act is the so-called “’Shimco lien.’”

6 / AUGUST 2015

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INDUSTRY NEWS

INDUSTRY>NEWS Canada tops LEED list for second year in a row Canada once again sits on top of the U.S. Green Building Council’s list of the Top 10 Countries for LEED implementation. The list highlights countries outside of the U.S. that are making significant strides in sustainable building design, construction and transformation in the green-building program.

“We are extremely proud to be named as the top country for LEED projects internationally again this year,” said Thomas Mueller, president and CEO of the Canada Green Building Council, Ottawa. “Building owners and developers are increasingly making LEED an integral part of doing business, spurring demand for innovative products, technologies and services, and in the process creating jobs and positive bottom lines.”

“At a time when the world needs real leadership to solve the problems facing us all, Canadian business leaders, policymakers and consumers have turned to LEED to show the international community what we can do at the local level to promote real, substantive change,” said Rick Fedrizzi, CEO and found-

Photo: Doosan Ontario

THE RANKING:

Total GSM of LEEDcertified and registered commercial/ institutional space (millions)

Total number of LEED-certified and registered projects (commercial and institutional)

Rank

Nation

GSM of LEED certified commercial / institutional space (million)

1

Canada

25.39

68.41

4,736

2

China

20.42

115.26

1,968

3

India

12.74

72.46

1,836

4

Brazil

4.86

24.27

977

5

Republic of Korea

4.65

17.29

275

6

Germany

3.92

8.24

420

7

Taiwan

3.76

8.65

146

8

United Arab Emirates

2.839

52.64

901

9

Turkey

2.837

22.15

455

10

Sweden

2.5

4.17

195

*

(United States)

298.15

472.01

53,640

ing chair, USGBC. “It is always encouraging to see highly developed nations such as Canada rally around the idea that increased sustainability does not need to come at the expense of a high standard of living and that making this type of commitment actually enhances national well-being.”

Countries on the list were ranked in terms of gross square meters of area and numbers of commercial and institutional LEED projects to date (LEED homes were

not included). The United States is not considered part of the list.

According to the CaGBC, nearly 172,000 GSM of space is certified using LEED every day. More than 69,800 commercial and institutional projects representing 1.23 billion GSM of space are currently participating. An additional 76,500 residential units have been certified under LEED for Homes, and LEED projects can be found in more than 150 countries and territories around the world.

Doosan opens Ontario parts depot A 929 sq. m. parts depot has been established in Mississauga, Ont., to serve Doosan Heavy Equipment’s customers in eastern Canada. The facility will improve delivery speed for critical parts, reduce wait times and enhance customer service.

“By establishing a Canadian parts depot, Doosan dealers and customers can easily and quickly receive the urgent parts they need to minimize downtime and to maintain their production schedules,” says Laura Ness Owens, director of communications for Doosan.

The depot will help reduce delivery delays associated with carrier handoffs and customs operation. “Originating parts from Ontario creates a launching pad for faster and more affordable delivery, all while elevating the Doosan brand in the Canadian market,” says Clay Caldwell, parts director for Doosan.

8 / AUGUST 2015

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INDUSTRY NEWS Global coalition to unify standards London Machinery opens parts branch in Alberta London Machinery Inc. has opened a parts branch in St. Albert, Alta. The facility supplies OEM mixer and refuse parts, which can now be delivered more quickly throughout Western Canada.

“Our new facility offers a complete line of OEM parts and a sales representative to help keep your fleet in peak condition,” said Bob Monchamp, vice president and general manager of the firm.

The new location is now open and stocks OEM London and McNeilus parts, as well as parts supplies for most major competitors.

London Machinery Inc., part of Oshkosh Corp., provides readymix vehicles and replacement drums, McNeilus refuse trucks and CON-E-CO batch plants.

WorkSafeBC targets residential asbestos In July, WorkSafeBC prevention officers began to increase their inspections of residential demolition and renovation sites to ensure that contractors adhere to health and safety laws when identifying and removing asbestos.

“While asbestos does not pose a health risk when left undisturbed, preventable exposures can cause fatal lung diseases, with symptoms developing many years later,” says Al Johnson, vice president of Prevention Services. He added that 77 B.C. workers died last year from asbestos-related diseases. “Today, the numberone way to be exposed to asbestos is by unsafe practices during demolitions and renovations.”

Many buildings constructed before the late 1980s contain asbestos-carrying construction materials such as insulation, floor tiles, cement pipes, drywall, linoleum and spray-applied fireproofing. From

The Canadian Institute of Quantity Surveyors, Markham Ont., has joined more than 30 international construction and cost-engineering organizations to launch a major initiative that seeks to create international construction measurement standards in construction.

Professionals from more than 140 countries were involved in creating the International Construction Measurement Standards Coalition. ICMS aims to create an overarching international standard that will harmonize cost and measurement definitions in order to enhance comparability, consistency and benchmarking in the construction industry.

“In an industry worth a staggering $8.5 trillion in 2015 (according to Global Construction Output 2020), inconsistency in something as fundamental as construction measurement can create huge uncertainty and risk,” according to CIQS. The coalition has stated its ambition to make tangible progress immediately and to arrive at an internationally agreed and adopted standard in the near future.

2005 to 2014, 581 workers died in B.C. from diseases related to longterm exposure to asbestos.

Last year, WorkSafeBC conducted 210 site inspections and found 43 per cent of hazardous material surveys done by contractors were inadequate. WorkSafeBC Officers wrote 257 orders for hazardous materials violations and imposed 20 penalties, according to the organization.

Five B.C. municipalities require those seeking demolition permits to demonstrate due care by providing results of an adequate hazardous material survey. These include the City of Coquitlam, City of Vancouver, District of Saanich, City of Nanaimo and City of Port Coquitlam.

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INDUSTRY NEWS

Consensus reached on LNG project Major Canadian LNG projects are making progress in taking final investment decisions and winning vital environmental approvals.

Canada’s Environment Ministry has approved Shell’s LNG Canada project at Kitimat, BC, contingent on the project meeting 50 environmental, social and operational conditions. Federal Environment Minister Leona Aglukkaq took the crucial step in granting Shell the licence in part due to the long-term benefits to Canada in terms of massive job and revenue creation. In addition, the province of British Columbia issued its own environmental certificate stressing that ongoing consultation with aboriginal peoples and local communities is key.

Safety Plan update published in Ontario

Days prior to Shell’s announcement, another major step forward for the burgeoning Canadian LNG industry has been taken

by Petronas. The Malaysian energy giant’s Pacific Northwest LNG project has received the conditional financial investment decision from the Petronas board, setting in motion the next phase of the $11-billion project.

Pacific Northwest LNG’s president, Michael Culbert, emphasises the critical timing of this decision in a statement: “The integrated project is poised to create thousands of construction and operational careers in the midst of the current energy sector slowdown.” He adds, “A financial investment decision is a crucial step to ensure that the project stays on track to service contracted LNG customers.”

The Ontario Ministry of Labour has released its updated construction sector safety action plan designed to raise awareness about, and increase compliance with, Ontario’s Occupational Health and Safety Act (OHSA) and its regulations.

The Construction Sector Plan outlines the ministry’s enforcement initiatives and identifies what inspectors will be looking for. Every year the MOL holds consultations to shape and improve its occupational health and safety compliance strategy and build closer partnerships with its stakeholders.

These sessions: • help the ministry to improve its approach to better meet the public’s needs • provide an opportunity to learn from the ministry’s partners • obtain feedback on how the program is working • increase support for new directions and • identify areas for improvement.

The Construction Sector Plan for 2015-2016 describes sector-specific hazards and compliance issues, and the MOL’s enforcement focus for inspections in construction sub-sectors.

The plan also acknowledges recent changes to the OHSA that will impact: • occupational health and safety • workplace parties and • the ministry’s enforcement practices.

As part of the Safe At Work Ontario strategy, construction inspectors focus on specific construction sectors where there are high injury rates, history of non-compliance, and known workplace hazards. They will also continue to confirm/verify overall compliance with the OHSA and its regulations.

Inspectors are not limited to inspecting for contraventions/noncompliance identified in this document, and will exercise their discretion in taking appropriate enforcement action at each workplace inspected.

12 / AUGUST 2015

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INDUSTRY NEWS

AEM updates grader safety manual New “industry-recognized” pictorial elements that help communicate safety messages to equipment users have been incorporated in its Grader Safety Manual by the Association of Equipment Manufacturers, Milwaukee, Wisc. The graphics conform to ISO and ANSI standards and are included in the AEM Pictorial Database.

The manual describes preparing for safe equipment operation, safe operation guidelines and important equipment maintenance.

A free online resource, the AEM Pictorial Database has more than 140 pictorials that can be downloaded through a variety of graphics and computer-aided design software packages.

AEM created the pictorial database as an industry service to help companies communicate effective safety messages through consistent, industry-recognized pictorial representations.

For more information, visit www.safetymaterials.org.

$975M investment studied in Don River anti-flooding project The federal, provincial and city governments, together with Waterfront Toronto, committed $5 million in funding to complete due diligence work on the Don River anti-flooding project.

The project will provide greater certainty on the costs and risks associated with the proposal to naturalize the mouth of the Don River, provide flood protection to the area and unlock significant economic development potential – including the First Gulf/Unilever site.

The flood-protection proposal addresses the fundamental challenge of transforming the underused Port Lands into a long-term asset that will support Toronto’s growth and economic competitiveness.

Flood-protecting the Port Lands is the second phase of flood protection on the waterfront. The first was the flood protection of the West Don Lands, the current site of the Pan Am Athletes’ Village. That flood-protection infrastructure now protects 210 hectares of eastern downtown Toronto, including the West Don Lands, parts of the Financial District and the South Core.

The due diligence work is being undertaken primarily by Waterfront Toronto and will provide governments with

14 / JUNE 2015

additional assurance on the estimated $975 million cost of this project, which includes: • r erouting the Don River to the middle of the Port Lands between the ship channel and the Keating Channel • remediating the area’s contaminated soil • creating new parks, wetlands and resilient urban infrastructure that will remove the flooding risk • unlock a large area for revitalization and development – including the creation of a new community called Villiers Island – and create billions of dollars of economic development opportunities.

The first phase of the due diligence work is expected to be completed by November. It will enable government funding of the project by providing confirmation of the cost of the project, strategies to mitigate the risks associated with the project, and an implementation strategy.

An independent study by PwC performed for Waterfront Toronto last year estimated that spending on design and construction on the project would generate $3.6 billion in value to the Canadian economy, 7,672 person years of employment and $346 million in tax revenues to all levels of government.

INDUSTRY NEWS

APPRENTICE MOBILITY PROTOCOL SIGNED Canada’s Premiers have opened the door for nationally certified apprentices to work across the country. The new Apprentice Mobility Protocol, signed during the annual summer meeting of provincial and territorial premiers, articulates the agreements that jurisdictions have reached to achieve a provincial-territorial approach to mobility for apprentices.

It includes the recognition that work experience and technical training may occur in any jurisdiction, that jurisdictions will facilitate mobile apprentices progressing through their apprenticeship programs, and that apprenticeship training and pre-apprenticeship training be recognized mutually between jurisdictions.

“This initiative is a significant step in promoting labour market mobility across Canada and will support our efforts to increase the population of the Northwest Territories,” said NT Premier Bob McLeod. “There is a growing need for skilled tradespeople across the country, and with this protocol, we are providing a means for apprentices to choose where they would practise without having to recertify.”

Each province and territory is currently responsible for apprenticeship, resulting in 13 different apprenticeship systems across the country. This can lead to barriers in apprenticeship skills training mobility and may interrupt the continuum of skills training for apprentices that need or want to move while completing their apprenticeship.

Jurisdictions continue to discuss implementation details, with the protocol expected to take effect in all jurisdictions in January 2016.

The Canadian Federation of Independent Business applauded

REGINA BYPASS IS SASKATCHEWAN’S LARGEST INFRASTRUCTURE PROJECT SaskLink Global Transportation Partners has been selected to build the Regina Bypass as a DBFMO P3. Once complete, the bypass will be the largest transportation infrastructure project in Saskatchewan’s history.

“After more than a decade of planning and significant consultations with municipalities, stakeholders and the general public, work will start in just a few short weeks, with the immediate priority being the long-awaited overpass at White City,” said Saskatchewan’s Highways and Infrastructure Minister Nancy Heppner said.

Based on preliminary numbers, this project will generate significant economic benefits for the province by creating 8,200 construction-related jobs.

The consortium includes VINCI, GraCorp Capital, Parsons, Graham,

16 / AUGUST 2015

the premiers for taking a strong first step in the fight to remove internal trade barriers, as the provincial and territorial leaders meet in St. John’s.

“Canada faces a significant skilled worker shortage,” said CFIB executive vice-president Laura Jones. “Making it easier to move between provinces will help to attract more people to the skilled trades.”

“Premiers deserve a pat on the back. It’s not easy to get 13 jurisdictions to agree on anything,” added Jones. “This is great work toward the bigger goal of free trade in Canada. The next big step is to mutually recognize each other’s regulations. That’s the mother lode.”

Carmacks, McElhanney, Urban Systems, Buckland and Taylor, exp, Clifton Associates, Delcan and National Bank. Contract negotiations are underway with the intent to finalize terms by late-summer 2015.

Meanwhile, the province will enter into an Early Works Agreement with SGTP in advance of contract finalization. Early works will include work related to service roads to the southeast and east of the city and the overpass at White City. Activities such as design work, utility moves and clearing may be part of the Early Works Agreement.

Construction on the publicly owned bypass is expected to begin this summer and be complete by fall 2019, with priority components opening in advance of the full bypass completion.

The route includes the west portion that is already under construction and its next phase, running from Dewdney Ave. to

Highway 11. The south portion runs from the new overpass at Highway 1 to Highway 33 about five km. south of the city, and includes twinning the portion of Highway 6 between Highway 1 and the Bypass. The southeast portion runs from Highway 33 to Highway 1 east about 400 m east of Tower Road. The project will include three overpasses at the Pilot Butte Access Road, Highway 48 at White City and Highway 46 at Balgonie.

“This is a significant milestone for Saskatchewan as we move forward with our second P3 infrastructure project that will not only improve the quality of life for Saskatchewan people, but one that is also delivering savings and on-time delivery for taxpayers,” SaskBuilds Minister Gordon Wyant said.

The federal government, through PPP Canada, is investing up to $200 million in the project.

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008

CONSTRUCTION STATS

Permits rise 13.5 per cent in June

A selection of data reflecting trends in the Canadian construction industry

Capex declines in non-res construction Capital expenditures across Canada in non-residential construction and machinery and equipment are expected to total $251.8 billion in 2015, down 4.9 per cent from 2014, according to a Statistics Canada study.

Public sector capital spending is expected to decrease 0.2 per cent and private sector capital expenditure is anticipated to fall by 7.0 per cent, according to StatsCan. That is mainly because of lower predicted spending in the mining, quarrying, and oil and gas extraction industry, totalling $67.9 billion – an 18.7 per cent decline from 2014.

Organizations in the mining, quarrying, and oil and gas extraction sector reported that capital expenditure in construction and machinery and equipment is expected to fall by $15.6 billion, or 18.7 per cent, to $67.9 billion in 2015. The mining, quarrying, and oil and gas sector is still expected to be the largest capital spending sector, accounting for more than onequarter of total capital expenditure.

The largest provincial increase for the mining, quarrying, and oil and gas extraction sector is anticipated to be in Newfoundland and Labrador, where capital expenditure is expected to rise by $86 million or 1.6 per cent to $5.4 billion.

Capital expenditures by organizations in the health care and social assistance sector are anticipated to total $8.7 billion in 2015, down 14.2 per cent from 2014. The hospital subsector is expected to account for 80.8 per cent of the decrease.

Overall, capital spending in the transportation and warehousing sector is expected to show the largest growth in 2015.

300

Institutional and industrial construction in Quebec and commercial buildings in Alberta drove a 13.5 per cent increase in building permit totals in June over May 2015. The June total was $8.0 billion, according to a report from Statistics Canada.

Nonresidential building permits rose 32.5 per cent to $3.8 billion. That was the third monthly gain in a row, with Quebec responsible for most of the growth at the national level.

The value of permits in the residential sector stayed roughly the same, increasing 0.4 per cent to $4.2 billion. That marked a fourth consecutive monthly increase. Ontario recorded the largest increase, followed by Nova Scotia and Quebec. British Columbia had the largest decrease.

8.5

$ billions

8 7.5 7.0 6.5 6.0 5.5 5.0 4.5

2009

2010

2011

2012

Seasonally adjusted

2013

2014

Trend

Source(s): Statistics Canada

June housing starts trend upwards The trend measure of housing starts in Canada was 183,959 units in June, compared to 179,908 in May, according to Canada Mortgage and Housing Corp., Ottawa. The trend is a six-month moving average of the monthly seasonally adjusted annual rates (SAAR) of housing starts.

“The trend in housing starts increased this month as multiple starts trended upward, offsetting a downward trend in single-detached home starts,” said Bob Dugan, CMHC’s chief economist. “The rise in the trend of multiple starts reflects a 53 per cent increase in seasonally adjusted multiple starts from February to June 2015.”

“Seasonally adjusted multiple starts are at their highest level since September 2012, but are expected to moderate over the coming months,” noted Dugan.

Housing Starts in Canada - All Areas (thousands of dollars)

Capital expenditures: Lower intentions for 2015

240

250 215

202,818

200 190

150

183,959

100

165

50 140

0 2006

2007

Source(s): CANSIM

18 / AUGUST 2015

2008

2009

2010

2011

2012

2013

2014

2015

June 2014

June 2013 Housing Starts, SAAR

Source(s): Canada Mortgage and Housing Corp.

June 2015

Housing Starts Trend Line (6-month moving-average)

Infrastructure

Billion-dollar babies Inventory of super-megaprojects reaches new heights

BY JIM BARNES

T

o paraphrase the old one-liner, spend a billion dollars here and a billion dollars there, and pretty soon you’re talking about

real money.

Canadian contractors can be excused if they are feeling a little sticker shock. Ten years ago, to see a billion-dollar project coming down the pipeline was extraordinary. Just a decade later, these billion-dollar babies seem to be commonplace – happening across the country and in many sectors.

Even a large contractor can get a feeling of vertigo when bidding on a billion-dollar project for the first time. We went to experts in the industry to get some idea of how the environment has changed and how Canadian construction contractors are adapting.

FUNDING Billion-dollar projects are possible because massive funding is available in the market-

place to spend on them. Federal, provincial and municipal governments have joined forces to address Canada’s notorious infrastructure deficit, and jurisdictions across the country are throwing considerable weight behind infrastructure investment.

Large energy organizations, too, are putting shovels in the ground on projects that are of historical significance.

It has to start with the municipalities, notes Raymond Louie of Vancouver B.C., president of the Federation of Canadian Municipalities in Ottawa.

“Canada’s municipalities own approximately 60 per cent of public infrastructure in Canada and are responsible for planning projects of all sizes, including some of the country’s largest infrastructure projects and including public transit expansions,” says Louie.

“These large projects and require a funding partnership between all orders of government. When it comes to managing and

Ambassador Bridge, Windsor/Detroit.

delivering these projects, municipalities are best-placed to determine the right level of private-sector involvement,” he adds.

“Regardless of the private-sector role, a full one-third contribution from the federal government is critical and FCM was very pleased to see this affirmed in the new Public Transit Fund.”

Permanent, dedicated funding allows municipalities to consider these investments. As cities become involved in these projects in a consistent way, they can build up local expertise to manage it.

GROWTH OF P3S AND BUNDLING Another factor making the billion-dollar babies a reality is growing private-sector involvement, often in the form of alternative financing. While Public-Private Partnerships may be more expensive in the long run if you set no value on allocating risk to the builder, they often ease the short-term

on-sitemag.com / 21

“ We are doing due diligence with the city (of Toronto) right now on two very large projects, the Scarborough subway and the Gardiner Expressway.”

and the Waterloo LRT. Many other municipalities are now talking to us for a variety of roles around the province,” says Dicker.

“We are doing due diligence with the city (of Toronto) right now on two very large projects, the Scarborough subway and the Gardiner Expressway,” she says. More than 40 other jurisdictions have studied IO’s methods, including international infrastructure organizations.

One recent initiative is IO’s Spring 2015 Market Update, a list of major projects the organization has on its plate. It is intended to level the playing field for potential bidders with transparency on IO’s requirements.

The breakdown is revealing. The current list of 23 projects has two estimated at over a billion dollars in value – the Finch LRT and the Hurontario LRT. Two more projects are listed between $500 milllion and a billion; the Mackenzie Vaughan Hospital project and the Toronto Regional Courthouse.

CO-VENTURES AND PARTNERSHIPS financial burden on local government. Both federal and provincial governments are encouraging local government to consider the P3 approach.

They are singing to the choir. Many local governments embrace the concept and bundle projects together to take advantage of P3 benefits. Saskatchewan recently awarded a large contract for nine schools to the JUMP consortium. While the approach eases the management, financial and risk burden on government, it cuts the list of qualified bidders down to a very few.

The risks avoided through alternative financing are real. In Toronto, some city-owned transit projects have gone badly awry, leading Mayor John Tory to say that he was “furious” and that “We have lurched from one fiasco to another, costing taxpayers … tens of millions of dollars, and just as important, delaying the day we get desperately needed transit service.” P3 proponents emphasize that if alternative financing had been used, that risk would have been the contractor’s.

There is no question, says David Bowcott, senior vice-president and national director of Large/Strategic Accounts at AON Reed Stenhouse Inc., Toronto, that when a consortium assumes the risk, they manage projects

22 / AUGUST 2015

differently. “To me, that’s one of the magical aspects about a P3. Sure, they cost more, but they’re performing to a higher level of certainty than any other asset.”

Marni Dicker, executive vice president, general counsel and corporate secretary of Infrastructure Ontario (IO), Toronto, agrees on the benefits regarding risk. “Our model makes sense. We are on budget, we are on schedule and in the unlikely event that we are not, the public purse does not absorb the cost.”

INFRASTRUCTURE AGENCIES Provincial infrastructure agencies such as Partnerships BC and IO have a role to play in facilitating these projects. “Some of these agencies have a proven ability to manage larger projects – P3s or not,” notes Canadian Construction Association President Michael Atkinson, Ottawa.

Business is good. “We are at a monumental time in Ontario, with historic infrastructure investment,” says Dicker.

“This past year has been the busiest one in our history. We closed 14 massive projects – that’s more than a project a month… We have already completed 48 projects worth more than $13.5 billion dollars.”

“We been an advisor on the Ottawa LRT

There is strength in numbers. When faced with a risk that you can’t or don’t want to handle, partnering or joint venturing makes sense. “We’re seeing a lot of joint or coventures occurring between long-standing Canadian-based firms,” notes Atkinson.

Risk isn’t the only factor: sometimes it’s a capacity issue. Besides partnering, some firms have shown an interest in mergers and acquisitions to beef up their resources. Some acquisitions today seem to be more about acquiring staff than the client list, notes Atkinson.

It has to be a concern as project size ramps up. “If your market is primarily the public sector, and you are seeing these projects getting larger, obviously you could have capacity problems,” says Atkinson.

“The public sector faces the same challenges that the construction industry itself faces, in terms of demographics and experienced people,” he adds. That could be a factor in the move toward bundling.

BONDING, SURETY, LEGAL, PREQUALS Resources aren’t the only constraint in approaching these jobs. Surety and bonding might well be factors, too.

If internal growth or acquisitions seem unlikely, then joint venturing and partner-

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Continued from pg 22 ships may be the only viable alternative.

“In the Canadian marketplace, we usually see that jobs in excess of $300 or $400 million go to joint venture,” says Bowcott. “That’s partly because either their surety partners or their debt that’s putting money into the deal wants to see the risk spread out over more than one balance sheet.”

“A lot of owners are migrating toward a model where they’re trying to RFQ, which hopefully separates those who understand the risk they’re taking on from those that don’t,” says Bowcott.

You have to pay attention to the prequalification process. “In the old days, there was a handful of Canadian-based firms that could bid on these projects.

Now, the Europeans are here. There’s more competition; today, it’s no longer a slam-dunk,” says Atkinson.

Be prepared for a more complex legal environment. “The entire project is more complex,” says Dicker, “Therefore, the legal documentation, the project agreement, and all the corresponding schedules are much more complex.”

After a decade of experience, Dicker notes that IO’s documents are largely templated. “(The major law firms) have gotten used to our program, and in fact all of our deals follow the prior deals in the same asset class,” says Dicker. “We’re doing that very intentionally… We’re doing anything we can to make it easier for people to bid our projects, to gain a larger amount of interest from the market.”

Expect an ongoing stream of billion dollar projects over the years to come.

“As long as the economy stays buoyant, the projects are going to continue to get larger,” says Bowcott.

Ontario alone is committed to investing more than $130 billion in infrastructure over the next 10 years. “There’s 10 years worth of transit, transportation, and other infrastructure being built,” says Dicker. “It’s not going to slow down. It’s going to be a new asset class that we will be talking about in 10 years.”

Jim Barnes is On-Sites contributing editor.

24 / AUGUST 2015

BIG DEALS

A sampling of billion-dollar babies

LNG Billion-dollar projects related to the energy industry have become commonplace, and two of the biggest are LNG terminals planned for B.C. Petronas’s $11-billion Pacific Northwest project is a proposed natural gas liquefaction and export facility on Lelu Island. The facility would process and export natural gas produced by Progress Energy Canada Ltd. TransCanada Pipeline Ltd. will design, construct and operate a natural gas pipeline that will carry gas to the facility.

The project has received a conditional financial investment decision from the Malaysian energy firm’s board. Following selection of an engineering, procurement and construction contractor, the company has announced that it will be on the lookout for a variety of contractors, including: civil and earthworks; mechanical; electrical; marine; pre-engineered building design; fabrication; and concrete foundation and wall constructors, among other specialties.

Another super megaproject is the LNG Canada project, a partnership of Shell, KOGAS, Mitsubishi and PetroChina. It has an estimated value of more than $25 billion.

Being considered for the site of a former methanol plant in Kitimat, B.C., it has not yet reached a final investment decision. The plant will process, store and transport LNG. LNG Canada must first ensure the project is economically viable and meet several significant milestones related to gas supply,

engineering and cost estimates, supply of labour and regulatory approval. CFSW LNG Constructors, a partnership of Chiyoda, Foster Wheeler, SAIPEM and WorleyParsons, has been named as the main contractor for construction. Phase 1 construction could take five to six years.

HYDRO Electrical generating and transmission megaprojects seem to be popping up like weeds across the country as consumption grows and existing electrical infrastructure ages.

The biggest hydro project on the books is B.C. Hydro’s $8.3 billion Site C Clean Energy Project. The project involves a third dam, reservoir and hydroelectric generating station on the Peace River in northeast B.C. Part of the project includes the realignment of six sections of Highway 29 over a distance of 30 km.

Approved by the provincial government at the end of last year, construction is expected to begin in the summer of 2015 with completion in 2024. The project is currently the subject of protests by the B.C. Government and Service Employees’ Union, First Nations and environmental advocates.

Site C is not the only Big Hydro project on the books. In Newfoundland, Nalcor Energy is behind the Muskrat Falls development on the lower Churchill River in Labrador. The project includes an 824-MW dam and more than 1,500 km. of transmission facilities. Significant procurement activity

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for the project is already underway. The project is expected to generate more than $1.9 billion in income to businesses in Newfoundland and Labrador, $2.2 billion in Atlantic Canada and $4.7 billion across Canada, according to Nalcorp Energy.

Quebec Hydro’s Romaine Complex on the Romaine River has been estimated at $6.5 billion. It will ultimately consist of four generating stations, three of which will be operational by 2017.

The Keeyask Hydropower Limited Partnership is composed of Manitoba Hydro and four First Nations. The Keeyask Project includes infrastructure, generating and transmission components. The first generator unit in-service date is targeted for 2019, with all units being commissioned by 2020 at a total cost of $6.5 billion.

Ontario Power Generation’s Lower Mattagami Hydroelectric Complex, $2.6 billion, involves new generating capacity and upgrading of existing plants on the Mattagami River.

The project is in the approvals phase, and it will take an estimated minimum of four years to complete these projects.

ROADS AND BRIDGES Roads and bridges are the poster children for infrastructure renewal, and two bridge megaprojects are in the offing.

The New Champlain Bridge Corridor project is a $2.15-billion P3 deal signed with consortium Signature on the SaintLaurent Group (SNC-Lavalin, Flatiron and Dragados Canada). SSL will operate and maintain the bridge for the duration of the concession period, until October 2049.

The 3.4-km bridge will replace the existing Champlain Bridge and includes two vehicle corridors and a transit corridor. It will also have a multi-use path for pedestrians and cyclists.

In addition, the federal portion of Autoroute 15 is to be reconstructed and widened. Completion is expected to be completed by the end of 2018, with the balance of the project scheduled for completion in 2019.

Another iconic crossing is at Windsor/Detroit. The Windsor-Detroit Bridge Authority (a not-for-profit Crown corporation) has launched the first phase of the procurement process to build the $2.1 billion Gordie Howe International Bridge project. The WDBA will manage the procurement process for the design, construction, operation and maintenance through a public-private partnership (P3) and will be responsible for project oversight as well as setting and collecting tolls. The overall procurement process is anticipated to be up to 18 months in duration.

TRANSIT A federal Public Transit Fund is planned for 2017 to grease the wheels of billion-dollar transit projects. There should be no shortage of applicants.

Toronto’s Metrolinx agency is behind several transit megaprojects, the largest being the $5.3 billion Eglinton Crosstown LRT. The 19-km. project includes 25 stations and stops, connections to three subway stations and several GO Transit lines and a 10-km. underground portion.

The project is a 30-year DBFMO P3, awarded to Crosslinx Transit Solutions (EllisDon, ACS Infrastructure Canada, Aecon, and SNC-Lavalin) in June. Construction is underway, with completion set for 2020.

Other big jobs on Metrolinx’s plate include the Scarborough Subway Extension ($3.3 billion) and the Spadina Subway Extension ($2.6 billion), along with several

26 / AUGUST 2015

smaller megaprojects.

The federal government has committed $1 billion to the proposed $3 billion second phase of Ottawa’s transit expansion plan. At present, the provincial government has not yet committed to supporting the plan. With completion tentatively scheduled for 2023, Stage 2 will add 19 new stations and 30 km. of rail to Ottawa’s O-Train system.

In Alberta, Calgary’s Green Line will get 27 new stations and an additional 40 km of track, nearly doubling the size of the system, at an estimated cost of $4.6-billion.

Construction should start in 2017.

The roster of highway megaprojects keeps lengthening, too. The $5-billion Southwest Calgary Ring Road, for example, is planned to consist of 31 km. of six- and eight-lane road, 46 bridges, a rail underpass and 14 interchanges. It is planned as a P3. Following the completion of landtransfer agreements, Alberta’s provincial government recently pledged to complete construction within seven years.

Another massive megaproject is the Turcot Interchange in Montreal: the provincial government recently signed a $1.54-billion contract with the KPH-Turcot consortium (Kiewit Canada, Parsons Canada, Holcim Canada and WSP Canada Inc.) The project is expected to take five years.

In B.C., a bridge replacing the George Massey Tunnel is under study at a cost estimated at $3 billion. Construction could start in 2017.

BUILDING While buildings seldom reach the high valuations of other infrastructure in Canada, some are noteworthy in terms of their price tags.

While it is now substantially complete, Halton Healthcare’s Oakville Hospital was a marquee project, with a $2.27 billion price tag. The 148,645 sq m. hospital will have a capacity of up to 457 inpatient beds on opening day in December.

In Montreal, the $2 billion Centre hospitalier de l’université de Montréal (CHUM) hospital development is under construction, with completion of the 268,000 sq. m. hospital set for 2016 and the administration building complete in 2019. The hospital is aiming at LEED Silver and will offer 772 beds and 39 operating rooms.

Any list of Canada’s billion-dollar babies is something of a moving target. In many cases, the final costs are not known and the current price tags are only estimates. It is revealing in itself that we have to be selective in an article listing Canada’s billion-dollar construction megaprojects these days. It has become clear that a project has to be worth multiple billions before it makes the megaproject “A” list, and the era of the gigaproject (defined as projects worth more than $10 billion) is dawning.

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AWPs

AWPs

TOP REACH FOR THE

New designs bring AWPs roaring back from the recession

BY DAVID GODKIN

I

n 2009, the aerial work platform business was one of the hardest hit by the global financial crisis.

Nearly a quarter of the annual income walked out the door, according to the IPAF Rental Market Report. AWP demand “plummeted” as large construction jobs ended without new ones starting, rental companies sold off aerial equipment and existing fleets aged.

Since then, things have changed considerably for the better as the manufacturers focused on innovation and market development. Both Skyjack and Snorkel – two major players in AWP – reported growth in 2012 and 2013.

That culminated in a much more upbeat IPAF assessment of the Canadian and the U.S. market in 2014. The AWP rental fleet grew by 10 per cent, generating nearly $8 billion in revenue. All of it was due to strong demand from construction, in turn driving fleet expansion and higher rental rates.

“It has been on a pretty steady incline,” says Corey Raymo, JLG manager, Global Category Director/Boom Lifts in Harrisburg, Pa. “And if you look at that data forecast forward. I think it continues to increase, though maybe at less of an incline in the next five years.”

on-sitemag.com / 29

tory regulations governing platform load sensing in Europe will be mandatory in North America, too. “If your platform capacity is 1,000 lb., for example, and you put more than 1,000 lb.,” according to new ANSI regulations the machine is “not going to allow you to move.”

Details on how the new ANSI requirements will work, says Raymo, are yet to come. What is clear is that AWP manufacturers will be at pains to invest in the necessary load-sensing technologies, just as they and other manufacturers are investing in Tier 4 engine requirements.

“You need to start putting plans in place that provide the best overall approach to meet those regulatory requirements.

At JLG, we’re aware of it. We know the timing. And we’ll meet it with our product.”

Custom Equipment: access to confined jobsites.

BALANCED APPROACH Since 2009, JLG has tried to complement the slow rise in AWP sales and rental by upping its game in AWP design and manufacture. A good example is the 1850SJ, an ultra-boom AWP with a platform capacity (227 to 450 kg) and a working height of nearly 60 m. Another important factor for JLG’s customer base, says Raymo, is achieving maximum lateral reach “throughout the upper range of the work envelope” as well as great ground movement – i.e. the ability “to not only drive, but drive at full elevation.”

That addresses an immediate user need. “If the customer gets all the way up in the air and isn’t quite where they need to be, we want them to be able to drive the machine along the ground and get properly set up, instead of coming all the way back down and re-positioning.”

Nor does it hurt that the 1850SJ’s axles take only about a minute to extend or retract and that they are able to pivot in and out, so operators spend more time working and less time wrestling with their controls.

The key, says Raymo, remains giving customers what matters most to them: productivity through better reach-atheight and maximum load capacity.

He is also frank about two challenges facing the industry, one perennial to machine design and another that will be new to the AWP in 2016 and 2017.

The first is the pressure engineers are under to balance what is desirable in a machine with the laws of physics.

“You have to make some trade-off decisions. You can’t have the best of everything in your product and make some good choices.” A case in point, says Raymo: platform capacity and lateral reach. “If you want to up your capacity to, say, 1,500 lb. instead of a thousand, you can do that. But you’re most likely not going to be able to extend your boom as far.”

Next year, platform capacity will face another challenge, this time from an entirely different quarter. By 2017, manda-

30 / AUGUST 2015

HYBRID HOPES

‘‘

ou have to Y make some trade-off decisions. You can’t have the best of everything in your product and make some good choices.

A wide array of power options is available to North American AWPs. These include gas, diesel, electric and now hybrid - the most interesting, Raymo says, “because there’s so many different ways to do hybrid.” Already well-entrenched in commercial vehicles, trucks, buses, and even locomotives “a lot of our customers are asking questions and looking harder at hybrids.” That is not just because of the increased fuel economy, he adds.

“We’re also seeing some regulatory (requirements) where construction sites, depending on the job site, will be told you have to have no emissions or limited-emissions products, such as hybrids.

I think we’re seeing more and more of those job sites requiring those types of products,” he says.

One company out in front of the trend to hybrid hydraulic and electric AWPs is Custom Equipment Inc. based in Richfield, Wisc. In 2004, it introduced regenerative braking to its machine battery systems. Today, it combines electric drive with hydraulic lifting, delivering full AC power to its scissor lift when on-site power is not available. In addition, the machines have the ability to use hybrid or electric power for rough terrain or indoor slab environments. Notable among these is its 12-ft. HB-1230 low-level scissor lift.

An alternative to vertical mast lifts (gaining 15 in. more platform space by eliminating the mast) the HB-1230 combines electric drive with hydraulic lifting.

Why does that matter to users? To answer that, Custom’s

’’

JLG: Growth in platform capacity and working height.

Marketing Manager Justin Kissinger makes a quick comparison: getting a hydraulic motor pumping, he says, can take about 100 amps. By contrast, “an electric-drive motor, depending on the weight of the machine and its load, will turn on and start moving with as little as ten amps.”

The HB-1230 is also “extremely mobile,” something that became clear on a 42-in. wide ramp at the back service entrance at the Las Vegas Lift and Access Showcase in October.

The machine was able to maneuver the ramp very quickly, explains Kissinger. “Then, it was through a double service doorway at the top of the ramp, two 90-deg. turns down fiveft. hallways and up an elevator to the eighth floor.

“Because it’s a zero-turn system, you can actually pivot the machine along to the next wall. It allows the machine to turn on a dime without hitting the next wall,” explains Kissinger.

Custom Equipment focuses on the low-level access industry, according to Kissinger, leaving the 19-ft. and higher AWPs to other manufacturers. “That sector is really what’s helped our company grow,” he adds, and that includes contractors willing to pay admittedly higher rental rates in return for greater productivity and saving gains than can be achieved using ladders or scaffolding.

RUNNING WITH SCISSORS Back in 2012 when we chatted with Genie Industries Director of Product Management Chad Hislop, the focus was on solid-chassis, two-wheel electrically driven lifts for interior applications and four-wheel drive and oscillating-axle designs for more rigorous outdoor terrain.

Since then, a new category class has emerged in between the two, says Hislop. Minus four-wheel drive, but structurally the same as its GS 69 rough-terrain scissor lift, Genie’s GS 69DC and BE two-wheel scissors feature two powerful, direct-drive electric motors.

“Because those AC motors are direct drive, they’re very, very efficient and able to deliver an amazing amount of torque while taking a very small amount of energy from the

32 / AUGUST 2015

battery pack,” says Hislop. In fact, he adds, those AC directdrive motors and oscillating axles actually help the machine approach four-wheel drive performance.

Once again, it is because the hydraulics in the drive system have been eliminated. “Every time you switch energy from the battery to the electric pump, from the electric pump to hydraulics and then back from the hydraulic drive motor, you take an efficiency loss.” Cut out the hydraulics stage and the energy recovery “is significant, because now I’m going directly from batteries, getting rotational energy in an electric motor,” says Hislop. More torque with greater energy loss also means “longer run times and better terrainability.”

But Genie has also gone hybrid. The GS Bi-Energy Hybrid Scissor Lift series is based on the 69 DC but with an on-board gen set to charge itself, the chassis, the platform and working tools. AC drive motors on the rear, in combination with rough-terrain tires, make it suitable for outdoor applications, says Hislop. “If you need more than one day’s work out of a battery pack, the on-board generator will keep that machine running on the job even if there’s nowhere to plug it in.”

Users are asking for more efficient machines, smaller engines and lower fuel costs, Hislop adds. What they’re not willing to give up is performance. They are asking manufacturers to come up with the kind of innovative solutions in AWPs “that you have to come to expect in your Camry,” says Hislop. “I think you’re seeing the same kind of reaction in our industry. That includes the flexibility hybrid technology gives you to work indoors without emissions.

Might we see a day when an AWP is entirely electric – the equivalent of the Tesla automobile? Justin Kissinger says it all depends on the regulatory environment. Customers are not going to pay more than what is required by written standards. “A completely 100 per cent electric lift would have applications. You wouldn’t have to worry about hydraulic leaks, for example,” he says. “Overall, I think there is growth in the hybrid market. I think it would be a long time before you would see it go completely electric.”

‘‘

Users are asking for more efficient machines, smaller engines and lower fuel costs...

What they’re not willing to give up is performance.

’’

David Godkin is a B.C.-based freelance writer and editor.

Send comments to editor@on-sitemag.com.

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CONCRETE PUMPS: THE STATUS QUO IS NOT AN OPTION Competency certification will come to the construction industry across Canada Today, anyone with a Class 3 equivalent truck driverâ&#x20AC;&#x2122;s license can lease any size of concrete pump, drive it off the lot and start pumping concrete. Concrete boom pumps are massive, complex machines weighing up to 60,000 kg and operating at hydraulic pressures of up to 5,000 PSI. Vertical and horizontal boom lengths can reach to some 60 m.

It is not just the operator, the ready mix driver and the finisher at risk here. Everyone at the jobsite and the public within the proximity of the jobsite is at risk, too. When an accident does occur with a concrete pump, usually it is a serious incident that may involve death.

With the growth in use of pumping as a standard method of concrete placement, it has become key that the producerâ&#x20AC;&#x2122;s success is dependent on the performance of the pump operator.

Notwithstanding the technical challenges and advancements of pumps, safety is a prime aspect of any construction job, especially with heavy equipment.

From a safety and common-sense perspective, no one should using such equipment on a construction jobsite without being tested to ensure that they can operate such equipment in a safe and competent manner.

The construction sector in BC has decided to do something about this. It has launched the development of a concrete competency certification program through the BC Construction Safety Alliance. The project is being facilitated by the BC Ready-Mixed Concrete Association.

To date, skills standards have been developed and validated by subject-matter experts and industry-wide consultation on the standards. Assessment tools have been developed and pilot testing is underway. The program will be rolled out as a voluntary program in 2016, with the support of the BC construction industry.

The industry will begin insisting on certified operators once the testing regime has been instituted.

36 / AUGUST 2015

In the BC industry consultations, 100 per cent of the participants supported competency certification and 89 per cent were of the view that such certification should be mandatory. This should be a strong message for the Canadian construction sector that the status quo is not an option! To learn more and to follow the progress of the Concrete Pump Competency Certification program, go to www.pumpbc.ca and register to receive program updates.

At its board meeting in May, the Canadian Ready Mixed Concrete Association committed to a collaborative effort to bring concrete pump competency certification to the construction industry across Canada. Furthermore, they committed to partnering by establishing a National Occupational Standard (NOS) for concrete-pump operators. This will entail a national consultation on standards and a testing regime organized in cooperation with the Government of Canada.

The development of this NOS will enable unified standards for the country and labour mobility across Canada. Certified concretepump operation will become a recognized semi-skilled profession.

We are not alone in coming to the conclusion that competency testing must become an imperative in the concrete pumping industry. In March of this year, the American Society of Mechanical Engineers (ASME) published the new standards for Materials Placement Systems (ASME B30.27-2014), indicating that operators shall complete operations tests demonstrating proficiency in handling specific types of material-placement systems.

These are ambitious but achievable goals and the CRMCA is committed to lead this program within the Canadian construction sector. We are at the beginning of a process that will likely take at least two to three years. As we begin this process, we welcome your thoughts and comments.

Provided by the Canadian Ready Mixed Concrete Association.

Send comments to editor@on-sitemag.com.

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Pumping in those tough places

BY KIM CRAWFORD

Wortman Concrete Pumping.

C

ongested construction sites are now the rule, rather than the exception. Increased contractor pressures are combining with what can sometimes be described as logistical nightmares on today’s tight-space, small-footprint sites.

Concrete pumpers facing these conditions

needed a solution.

One such solution is the five-section, double-Z boom.

North American pumpers, using conventional four-section pumps, have not been able to access some of the more intricate or difficult-to-reach jobs readily in the recent past. In this era of confined space worksites, users are very interested in booms that easily can go where the previous four-section type went only with much greater difficulty.

Even with the multitude of boom configurations that a foursection can achieve, there are jobs that – despite the contractor’s

expectations - just are not physically possible with a four-section.

Rob Herbert, president of Rob’s Concrete Pumping in Regina, Sask., emphasizes the need for versatility. When asked about his 32-m. five-section double-Z machine he said, “Because it’s so flexible, it’s a good addition to the fleet. Now we can get to indoor jobs that we were struggling with when using a four-section. We can get more boom into the building. Besides that, the unfolding height is crazy, at less than 20 ft.”

With its low unfolding height, the five-section double-Z boom brings a higher level of access and maneuverability to the pumper’s portfolio. Joe Glass, of Glass Construction in Bismarck, N.D. when talking about his unit says, “This is the best truck in town. There are other trucks around – longer, bigger trucks – but they just can’t do what this one does.”

The five-section 32- or 38-m. double-Z boom has opened up a variety of applications for concrete pumpers.

on-sitemag.com / 39

Pump Trucks 32-m boom, A&B Concrete Pumping Ltd.

ACCESSIBILITY

32-m boom Glass Construction

Working around power lines requires an In some markets, there is an emerging trend operator who is both skilled and knowledgeable to erect the shell of the building first and pour and a boom that can be configured in a safe the floor later. This type of job often presented and efficient manner. The newest American difficulties when using a four-section pump.

Concrete Pumping Association safety guidelines Now, with a 32 or 38-m. double-Z boom state, “You MUST maintain 20 feet clearance pump, accessibility has been simplified. The from any power line carrying up to 350,000 low unfolding height that makes unfolding volts.” A five-section double-Z boom provides Configuration, 38-5 boom the boom while inside a building much easier the manoeuverability required to position your greatly opens up the scope of work a pumping boom segments in a compliant manner, safely company can take on, with the obvious potenaway from the lines, and then get to your job tial of increasing both revenue and profit. efficiently.

Randy Wortman, president of Wortman The units work well around power lines, notes Concrete Pumping in Norfolk, Neb. notes, Parker MacDougall, an operator from A&B Con“The configuration versatility of the five-section crete Pumping, Edmonton. “The 32-five double-Z double-Z boom surpasses that of any other fiveis a fantastic unit for working under power and section boom on the market. Having this much utilities lines because of the double-Z configuraversatility has drastically expanded the variety of tion. It allows an operator to unfold and swing jobs that can be completed for my customers and under the lines then unfold the rest of the boom made my pumping services more effective and for safe operation and clearance.”

Configuration, 32-5 boom competitive.”

TO A HIGHER LEVEL The added manoeuverability of a five-section becomes evident Jerry Gonzalez, from Northland Contracting in New York, an opwhen trying to reach through small openings in order to pump. erator with 18 years of pumping experience notes, “I spent a lot “We did a job at the college. The truck was on the road with the of years on a 31-m. telescopic and this is my first double-Z fiveboom reaching up two stories, and then it went into the building on section. The biggest thing I have found is the near-elimination of the third floor by another 30 to 40 ft.! A roll-and-fold would never be running line. This five-section is perfect in low-clearance jobs and able to do that,” comments Glass. The five-section is able not only to perfect in mezzanines. With so much X-bracing in the way, I’m unfold inside a building, but from there reach through inner doorways. able to create angles in order to use the whole boom on top of the Marty Hanson from Dart Services, Estevan, Sask. commented mezzanine, literally eliminating the running line. There’s nothing on his preference for five-section, double-Z folds. “With the ability I couldn’t get done with this five-section.” to put the boom further in the door, there’s less line for the placers Five-section boom configurations allow an operator to work to drag and less line the operator has to wash out. The job gets done from above a structure, reaching below and around to access the faster and easier,” he said. “Not only that, but with the double-Z required location. boom you can still run it like a roll-and-fold. It’s so versatile that you On the topic of pumping beneath structures, Nolan Unruh can easily go from the tight jobs operating in Z-formation right to an from Irish Creek Concrete, Dewberry, Alta. adds, “What I like A-frame configuration for residential footings and walls.”

40 / AUGUST 2015

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a structure with a four-section, you have to get too close to the ground. The five-section, because of the way it unfolds, is just simpler to run.”

When forced into tight set-up situations, knowing the specs by individual boom length will determine how the operator will be able to set up and unfold into the space available. Check with the manufacturer for details.

Some five-section pumps have a feature that can help out any pumper who has to set up in an extremely tight or cluttered space: T-style rear outriggers. They offer quick set-up with a small footprint.

The five-section double-Z machines win a lot of praise when applied to certain jobs that might otherwise cause challenges.

“It’s such a reliable truck, it does anything I want it to do,” says Glass. “Would I buy another one? You bet!”

about this five-section is that the fifth section – with the doubleZ – always ends up in the air. When you are going underneath

Kim Crawford, provided this article on behalf of the Canadian Ready Mixed Concrete Association. Send comments to editor@on-sitemag.com.

FIVE-SECTION PUMP ACTION

critical for the owner or manager to allow the operator time on the boom for safety reasons,” says O’Malley.

“You should probably charge out a little more for the machine, because the operating cost related to the wear factor is usually a little higher than for a four section machine.”

Five-section double-Z pump trucks are not yet in widespread use but could have a valuable part to play in many pump fleets.

“Concrete pumpers tend to focus on utilization,” says Tom O’Malley, vice president/general manager for Concrete Pumps, Schwing America, St. Paul, Minn. Apart from the obvious role this type of machine has in nonresidential construction, “The 31-m. boom is the most requested boom for residential concrete,” he says. “Any typical pump fleet could really benefit from having one of these machines. They’re kind of a utility pump, as I would describe them.”

Schwing’s machine, the S 31 EZ, has an unusual configuration, explains O’Malley. The first two sections telescope, like a crane. The next is a roll-and-fold, and the last two are Z-fold. This combination provides 26.5 m. of horizontal reach and over 830 deg. of articulation at its four folding points. Less than 5.7 m. of unfolding clearance is needed, facilitating work indoors.

The telescopic section helps reduce folding heights and offers stability. The roll and fold is very stable and easy to operate, while the Z-fold provides articulation.

This type of pump shines when used indoors. “A lot of contractors prefer to get the roof on a building before they pour the slab,” says O’Malley. They want to keep the elements away from the concrete pour. “That’s a very common application, slab on grade when you’re in an enclosed area. Mezzanines are very common, too,” he says.What should a prospective user take into consideration about the machines?

Generally speaking, compared to four-section machines, a fivesection machine is slightly more complicated to operate. As well, they have a higher maintenance cost due to the additional elbows and gaskets. On-site, they tend to have higher outrigger pressures due to the weight of the cantilever boom.

The familiarization process is as important for these machines as for any other. “Each boom has its unique features, and it’s

42 / AUGUST 2015

— Staff report Schwing S 31 EZ

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TTC’S GREAT BIG POUR CONTRACTORS PLACE 2,250 CU. M. OF CONCRETE IN 24 HR.

O

ne of the largest infrastructure projects underway in Toronto is the $2.6-billion Toronto York Spadina Subway Extension. The extension to the Toronto Transit Commission subway system will run from Spadina station on the Bloor/Danforth subway line, through York University and on to the Vaughan Metropolitan Centre near Highway 7 and Jane St. in Vaughan.

The project is being funded by the Government of Canada ($697 million), the Province of Ontario ($870 million), the City of Toronto ($526 million) and the Regional Municipality of York ($352 million).

The project comprises 8.6 km. of new track and six new stations: ownsview Park, on Downsview Park lands •D adjacent to the Barrie GO Transit line

One of two pumper trucks pouring the entrance ring.

• Finch West - at the corner of Keele St. and Finch Ave. • York University - near the common of York University • Pioneer Village - at North West Gate and Steeles Ave., east of Jane St. • Highway 407 - adjacent to Highway 407 and Jane St. • Vaughan Metropolitan Centre - near Highway 7, west of Jane St. The service is scheduled to commence at the end of 2017.

The Vaughan Metropolitan Station in York Region will be the northernmost stop.

That site will be the focus of a considerable amount of non-residential building.

Besides the subway connection, VMC station will serve as a hub for transit services from York Region and connect with the reserved VIVA express bus lanes on Highway 7.

In July VMC station was the scene of a massive concrete pour. The pour, by St. Mary’s CMB, filled the main entrance ring for the station in a day. Two concrete plants, with a third on standby, were required to produce the concrete due to the magnitude of the pour.

The pour began at 3:30 a.m. on Saturday, July 4. Concrete trucks arrived every five minutes and construction crews worked in ten-hour shifts, with two crews placing the concrete in different sections of the main entrance ring. The concrete was placed at a rate of 70 to 100 cu. m. per hr, with a total of 2,250 cu. m. poured.

The “Great Big Pour” wrapped up on Sunday, July 5, 2015 at 4:00 a.m.

Facts and images related to this article were provided by the TTC.

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RISK

By David Bowcott

A

Who should place project insurances?

long-debated topic in the construction sector is the question of who should place the project-specific insurance policies – the owner of the asset being constructed or the contractor being hired to construct it. The most common term used for owner-placed policies is Owner-Controlled Insurance Program (or OCIP). The term for policies placed by the contractor is Contractor-Controlled Insurance Program (or CCIP). As to which is best, there are many schools of thought and it would seem the answer is not black or white.

The following points represent some of the rationales for making the decision between OCIP and CCIP. • “I’m the owner and the asset is mine.”

Some owners feel that they should be placing the insurances for their projects because, at the end of the day, it is their asset and they are highly incented to ensure the asset is returned to normal if the asset is damaged and/or delayed during construction due to an insurable risk.

• “I’m the contractor and you’ve transferred the risk of building to me.” The contractor feels that since the owner has opted to transfer the risk of construction to the contractor, then as the holder of the risks related to the asset during construction, he should be the party placing the insurance to manage those risks.

• “ I am the owner and I understand my business and the assets I use in my business best.” The owner understands how the asset being built needs to perform in order to deliver the results necessary to achieve the company’s business goals.

Experience makes the owner more aware of how the insurance should be structured in order to deliver the desired results.

• “ I’m the contractor and I have the experience managing construction risk.” The contractor, when at risk through contract, is highly incented to put in place protocols and practices to manage key risks.

Through the volume of construction done through the company, they continuously refine these practices to improve risk results. That experience managing construction risk allows them best to tailor insurance covers to risk.

• “I do more volume.” Both the owner and the contractor can use this rationale.

It is based on the fact that the greater the volume of premium generated by insurance programs, the better the assurance of best terms. Some owners have tremendous capital expenditure budgets annually that generate significant premiums. Likewise, some contractors build huge volumes of work annually that also translate into significant insurance premiums. Whichever rationale wins out, the fact is that greater volume placed with the same group of carriers will achieve improved terms from those carriers. There is a bigger spread of risk and thus the opportunity to obtain improved coverage or reduced pricing.

• “I have strong relationships with my partner insurance markets.” Once again, this is a phrase used by both the owner and the contractor. This rationale cites relationship with partner insurance markets as a way to achieve best terms on coverage and best results in the event of a claim. Relationships and volume of business with insurance carriers do matter and can lead to optimal results.

Though all of the above are good rationales, in my experience intimate understanding of the risk is the best way

to achieve optimal results. If the risks are things like property damage during the construction phase, design errors, subcontractor failure, pollution events during the construction phase or liability events during the construction phase, the chances are that the contractor has the most experience managing these risks given that it is their business.

That said, there are owners that actively share in construction phase risks via their contracts and have equal – and in rare cases greater – understanding of construction-phase risks. For the most part though, the contractor tends to be the one most highly incented to manage the risk (due to risk being transferred to them via contract). Therefore, they have likely built their organization around managing these “very real” risks most effectively.

As an intermediary that helps my clients communicate to insurance markets how the owner and contractor will manage risks, it is vital for me to be armed with best-in-class risk controls. Most often, I obtain those from the contractor.

The ideal strategy should be a ProjectControlled Insurance Program. That means that both the owner and the contractor should collaborate in the insurance procurement. As well, both should share their combined strategies around how they will manage key project risks in order to achieve optimal terms.

In my experience, the insurance industry responds best to united strategies when the owner and contractor are collaborative and transparent. Further, when there is collaboration and transparency in the procurement model and contracts, the risks tend not to manifest and the insurance is not required to respond, as there are no claims. O

David Bowcott is senior vice-president and national director of Large/Strategic Accounts at AON Reed Stenhouse Inc. Send comments to editor@on-sitemag.com.

on-sitemag.com / 45

CONTRACTORS & THE LAW

By Lauren E. Kristjanson and Alexander Bjornson

M

any enforceable legal rights exist independently of statute. An action for trespass on land, for example, does not rely on legislation for an enforceable claim against that trespass. Instead, the concept was created through the common law (i.e. by decisions issued by courts).

Liens against land, however, are entirely dependent upon statute. Laws creating liens on real property in British Columbia have been on the books since the late 1800s, with several significant changes since then. In 1997, the provincial government significantly overhauled the legislation and introduced the Builders Lien Act, SBC 1997, c. 45 (the BLA). This act currently governs builders liens in the province and has been called “a major cornerstone of construction law” by the British Columbia Law Institute.

A CHANGE IS IN THE AIR Despite rapid evolution in the construction industry, the last significant change to the BLA occurred 18 years ago. As a result, there is movement to make some major reforms to the act that will impact players in the construction industry. In fact, the Law Institute has been tasked with carrying out a comprehensive review of the BLA and providing a report with recommendations for a legislative overhaul.

One of the issues expected to be dealt with in the new iteration of the Act is the so-called “Shimco lien.” This type of lien resulted from a British Columbia decision, Shimco Metal Erectors Ltd. v. North Vancouver (District), 2002 BCSC 238, aff’d 2003 BCCA 193 (Shimco).

In Shimco, the District of North Vancouver hired a general contractor for the construction of a tennis facility. As required

46 / AUGUST 2015

Changes coming to the Builders Lien Act

Changes to the Builders Lien Act are afoot and one victim may be the notorious Shimco Lien by the BLA, the district maintained a 10 per cent holdback on the funds owing to the general contractor. When several subcontractors were not paid by the general contractor, they filed liens against the land. However, one subcontractor that did not take the necessary steps for filing and commencing its lien claim against the property claimed a lien against the holdback itself – rather than the land.

The issue before the courts was whether a subcontractor can have an independent lien against holdback funds, despite no longer having a lien claim against the land.

Ultimately, the Supreme Court determined that the provincial legislature intended to create a lien against the holdback in addition to one against land. As a result, the subcontractor maintained its lien against the holdback. The decision was appealed and despite acknowledging the argument that a separate holdback lien could lead to “awkward and impractical consequences,” the Court of Appeal upheld the trial decision.

Due to the Shimco decision, it is now clear that in B.C. a lien claimant can enforce its claim as a lien against the land or as a lien against the holdback funds – now known as a “Shimco lien.” Importantly, a Shimco lien is not subject to the same registration requirements mandated for liens against land or other assets.

The establishment of this alternative remedy under the BLA was surprising to many involved in the construction industry and numerous commentators have expressed concerns with it.

In 2011, the B.C. Court of Appeal considered the Shimco lien in Wah Fai Plumbing & Heating Inc. v. Ma, 2011 BCCA 26.

In that case, the owners did not keep the statutorily required holdback, but the sub-

contractor brought a lien claim against the amount that should have been retained.

The Court found that where no property existed for a lien to attach to, the lien could not exist. As the holdback was never created, the lien claim was unsustainable. Importantly, the Court noted that the system of dual liens established by Shimco was “not warmly received by the profession and was the subject of critical commentary.” Nonetheless, although the court recommended a cautious approach to any extension of the availability of the Shimco lien, it confirmed its earlier decision and suggested that the only way to address the Shimco lien is through the legislature.

LOOKING FORWARD Based on this lukewarm endorsement of the Shimco lien by the Court of Appeal and the uncertainty it has caused in the construction sector, it is likely that any major legislative reform will include greater clarification of that form of lien, or even its abolishment.

Committee work on builders lien reform is ongoing and the Law Institute expects to have a final report on its recommendations for changes to the BLA sometime next year. Meanwhile, those in the construction industry will continue to grapple with the Shimco lien.

This article is for information purposes only and may not be relied on for legal advice. O Lauren E. Kristjanson is a lawyer at Borden Ladner Gervais LLP (BLG), practicing in the area of commercial litigation with an emphasis on contract and construction disputes. Alexander Bjornson is a lawyer at BLG, specializing in commercial and construction litigation.

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