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“I’m tired of disconnected applications and paper processes.”

Connect resources, workflows & data with the PLATFORM for heavy construction. ESTIMATING & BIDDING





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COVER STORY 30 Excavators that SUCK Safer and less destructive than traditional digging methods, vacuum excavation is growing in popularity across the jobsite.



Cultivating leaders


News Industry news


Letter to the Editor Password changes



Construction Stats The latest news on construction activity and employment

COLUMNS 44 Risk Take a step back for strategy


Contractors and the Law Don’t make these 5 mistakes about performance bonds

20 45 Index of Advertisers




Contractors find the “killer software app” isn’t any particular functionality, but the technology that enables multiple apps to work together efficiently.

Major excavation and mining of Toronto’s Eglinton Crosstown LRT is progressing on time and on budget, with minimal disruptions.

Many new products were unveiled at World of Concrete at the Las Vegas Convention Center January 23 to 25. On-Site shines a spotlight on several contractor favourites.

Ahead of the curve

Digging deep

WOC product spotlight / 5

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Do what you know needs doing Nine years, one month, six days, and I think roughly two hours, is how long I have been the editor of On-Site. And, this, my 63rd editorial, is proving to be the trickiest one I have had to write so far. You see, by the time you read this column, I will have hung up my hardhat as editor, and some other lucky soul will get to work with all of you – Canada’s nicest, hardest working, and most resilient folks around. In the time that my mug has graced this page, I’ve had the opportunity to work with all kinds of contractors, associations, product managers, and consultants. The conversations we’ve had on muddy jobsites, remote testing grounds, trade show floors, or even poolside, have taught me a thing or two about what it takes to be successful in Canada’s construction sector.

Get the latest construction news! Follow us on Twitter @OnSiteMag

Without further ado here are a few of the life lessons I have learned by observing all of you: 1. People are the heart, soul, brains, legs, arms, fingers, and toes of this business. Hire smart people, treat them well, and trust them. 2.Technology should be embraced, but not without doing your research first.

and change orders are a pain in the ass. But, successful contractors know there is more than one way to tackle any job. 5. Embracing sustainable construction practices and materials not only differentiates you from your competition, it also allows you to build structures that last longer, require less maintenance, and improves quality of life for future generations. 6. Construction leaders do what they know needs doing. They don’t sit around and hope someone else will clean up their mess, or put the tools away. They take great pride in the work they do, and can’t sleep at night if they know something isn’t quite right. I have thoroughly enjoyed my time as editor of On-Site, and am so pleased that my new position will keep me close to the construction industry. Please keep reaching out to the On-Site editorial team with you feedback, story ideas and insights. It is your contributions that keep this magazine relevant.

Corinne Lynds / Editor

3. Give back to the industry. Collaborating with associations, schools, charities, consultants, and like-minded contractors will grow the industry, and your business. 4. Real-life experience is invaluable. Tools break, equipment gets stuck in the mud, / 7

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CONTRIBUTORS / Fax: 416-442-2230

MEET OUR CONTRIBUTORS FOR THIS ISSUE JACOB STOLLER / Principal, StollerStrategies On construction apps: “Perhaps the most critical reason for exchanging information between apps is that it gives decision-makers visibility into the many resources that are tied to a particular activity.”

PUBLISHER | Peter Leonard (416) 510-6847 EDITOR/EDITORIAL DIRECTOR | Corinne Lynds (416) 510-6821 ASSISTANT EDITOR | Jillian Morgan (416) 510-5201 MEDIA DESIGNER | Lisa Zambri ASSOCIATE PUBLISHER | David Skene (416) 510-6884 ACCOUNT COORDINATOR | Kim Rossiter (416) 510-6794

LINDSEY VON BLOEDAU / Associate Lawyer, Borden Ladner Gervais LLP On performance bonds: “Performance bonds are common on construction projects, and so are misconceptions about them. Don’t make the five [biggest] mistakes.”

CIRCULATION MANAGER | Urszula Grzyb (416) 442-5600 x3537 Vice President | Tim Dimopoulos (416) 510-5100

COO | Ted Markle President & CEO | Mike Fredericks Established in 1957, On-Site is published by Annex Business Media 111 Gordon Baker Road, Suite 400, Toronto, ON M2H 3R1 Publications Mail Agreement No. 40065710

DAVID BOWCOTT / Global Director – Growth, Innovation & Insight, Global Construction and Infrastructure Group at Aon Risk Solutions On strategy: “Design firms and contractors have so much untapped value to offer. Who knows better how to get the most out of an asset, that the team that created it?”

NATE HENDLEY / Freelance Writer and Author On vacuum excavators: “Proponents argue vacuum excavating is safer and less destructive than traditional excavating methods involving shovels or backhoes. Vacuum excavators have also become more advanced and powerful in recent years, which enhances their appeal.”

JILLIAN MORGAN / Assistant Editor, On-Site On Saskatchewan/Alberta trade dispute: “Saskatchewan lifted its ban on Alberta license plates 12 hours before an independent panel would strike a rule in the dispute.”

ISSN: 1910-118X (Print) ISSN 2371-8544 (Online) Circulation email: Tel: 416-442-5600 ext 3258 Fax: 416-510-6875 or 416-442-2191 Mail: 111 Gordon Baker Road, Suite 400, Toronto, ON M2H 3R1 SUBSCRIPTION RATES Canada $48.50 per year, Outside Canada US$85.50 per year, Single Copy Canada $13.00. On-Site is published 7 times per year except for occasional combined, expanded or premium issues, which count as two subscription issues. Occasionally, On-Site will mail information on behalf of industry-related groups whose products and services we believe may be of interest to you. If you prefer not to receive this information, please contact our circulation department in any of the four ways listed above. Annex Privacy Officer Tel: 800-668-2374 Content copyright ©2018 by Annex Publishing & Printing Inc may not be reprinted without permission. On-Site receives unsolicited materials (including letters to the editor, press releases, promotional items and images) from time to time. On-Site, its affiliates and assignees may use, reproduce, publish, re-publish, distribute, store and archive such unsolicited submissions in whole or in part in any form or medium whatsoever, without compensation of any sort. DISCLAIMER This publication is for informational purposes only The content and “expert” advice presented are not intended as a substitute for informed professional engineering advice. You should not act on information contained in this publication without seeking specific advice from qualified engineering professionals.


Canadian Construction Association

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INDUSTRY>NEWS 51,000 new jobs added to construction industry in 2017 Canada’s unemployment rate fell to its lowest in four decades in 2017, with 51,000 jobs added to the construction industry. The Statistics Canada monthly labour force survey reported a year of growth across all industries. Unemployment rates landed at 5.7 per cent, the lowest since 1976. Construction employment grew 3.6 per cent in the last year. The industry saw a 0.5 per cent bump from November to December 2017, a total of 6,500 new jobs. Gains for the industry were mainly

concentrated in British Columbia. The province closed out the year with an employment growth rate of 3.4 per cent. Across the country and in all industries, 423,000 new jobs were added – the fastest rate recorded since 2002, according to Statistics Canada. Employment in the goods-producing sector grew 3.5 per cent in 2017. Manufacturing saw 86,000 new jobs, followed by natural resources with 15,000. Nearly all gains for the year were in full-time work, increasing by 394,000. Total hours worked grew to 3.1 per cent in 2017.

The number of employed people aged 55 and over increased by 5.3 per cent in the past year, exceeding the rate of population for this group. In December, there were 33,000 more workers aged 55 and over. The country added 79,000 new jobs in December, entering a third consecutive month of job growth. The increase for the month was concentrated in parttime work, which reached 55,000. The largest employment gains were observed in Quebec and Alberta. SOURCE: STATISTICS CANADA

EllisDon in partnership with U of T acquires $2.4M in funding for Carbon Accounting Tool EllisDon, in partnership with the University of Toronto (U of T), has successfully secured a $2.4-million grant through the TargetGHG Collaborative R&D program to develop a Carbon Accounting Tool. The program is supported by Ontario Centres of Excellence (OCE) and the Natural Sciences and Engineering Research Council of Canada (NSERC). “This tool will be imperative in transforming the construction industry and its associated supply chain into a low carbon sector,” said Natasha Arsenijevich, program coordinator, Carbon Impact Initiative, EllisDon. “Once we are able to quantify and

confidently determine the most adverse materials and processes, we can strategically prioritize our response and take meaningful steps toward climate change mitigation.” EllisDon engaged U of T to develop a fully working beta version of the Carbon Accounting Tool over the course of the three-year program. As part of the Carbon Impact Initiative Action Plan launched by EllisDon in June 2016, the objective of the Tool is to quantify greenhouse gas (GHG) emissions generated during the entire lifecycle of a new-build or retrofit project. There are currently no such tools on the market that incorporates the breadth and complexity of this information capture, tracking, and analytical capability. “What we’re building is a decision-support tool that can be used in the early stages of design and planning,” said professor Heather MacLean (CivE), one of five U of T Engineering professors involved in the project. “Ultimately, the goal is to produce infrastructure with much lower greenhouse gas impact.” The Tool will help identify areas where GHG emissions are highest and provide comprehensive solutions and strategies to achieve optimal GHG reductions. Once completed, EllisDon will incorporate this tool into all of its projects for testing in preparation for commercialization of the product. SOURCE ELLISDON CORPORATION

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THE CUSTOMER IS ALWAYS RIGHT. “Komatsu’s product support is the biggest thing with me. Their equipment is quality. The products with intelligent Machine Control technology help make my crews more efficient, and my esti estimates more competitive. We have never had any major issues, and if we have a concern, they stand behind us. Komatsu is a great company to work with!”

USED WITH PRIDE © 2017 Komatsu America Corp. All Rights Reserved

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Construction started for Toronto Port Lands transformation

Newly formed national contractors alliance to focus on policy, legislation BY JILLIAN MORGAN The Ontario General Contractors Association (OGCA) and Corporation Des Entrepreneurs Generaux du Quebec (CEGQ) have formed the General Contractors Alliance of Canada (GCAC). CEGQ is an organization that focuses on the interests of industrial, commercial and institutional general contractors in Quebec. The national organization will engage with federal and provincial governments on policy, regulation and legislation related to procurement, payments and liens throughout the constructions supply chain. GCAC includes general contractor associations and contractors. It has 400 members at present and aims to support general contractors operating under both provincial and federal jurisdictions. The Minister of Public Services and Procurement will soon launch a national discussion on prompt payment. According to GCAC, general contractors across the country will support and participate in that process through the alliance. “Ontario general contractors were important participants in the Lien Act review and Bill 142,” said Matt Ainley, chair of the GCAC. “We will use this experience to support general contractors in other provinces as many are reviewing their Lien Acts and would like to benefit from lessons learned in the Ontario experience.” GCAC said it intends to focus on solutions that support the growth of the Canadian construction sector. It will develop and recommend initiatives and provide advice to industry, government and the public. Working with stakeholders in the supply chain on a collaborative basis, the alliance hopes to find solutions that make the construction industry more competitive. Interested contractors can visit the GCAC website (

ON-SITE WELCOMES JILLIAN MORGAN TO THE EDITORIAL TEAM Jillian Morgan is a journalism graduate of the University of King’s College in Halifax, NS. Originally from St. John’s, NL, Jillian has made Toronto her home. Prior to joining On-Site as assistant editor, Jillian worked as a content specialist for an internet marketing company. You can reach her at 416.510.5201 or

The first phase of a $1.25-billion project to protect Toronto’s Port Lands and unlock new land is underway. Construction has started with lake filling on Cherry Street, a roadway located at Essroc Quay near on the south side of the Keating Channel where it meets Toronto’s inner harbour. This component of the larger Port Lands transformation is intended to protect the shoreline in flood conditions. It will ultimately form part of a proposed park. The Cherry Street project received $65 million in tri-government funding through the Clean Water and Wastewater Fund. It will be managed by Waterfront Toronto. “This is a once-in-a-lifetime opportunity to transform an underused resource in the heart of downtown,” said Will Fleissig, CEO of Waterfront Toronto. The remaining $1.85 billion needed to complete the Port Lands project will also be provided through tri-government funding, with each government partner contributing one-third of the full cost. “The start of construction in Toronto’s Port Lands marks an important milestone in the City’s vision for a vibrant, clean Toronto waterfront,” said Toronto Mayor John Tory. “This is the beginning of unlocking the potential of our underutilized waterfront lands, protecting the area from flooding and supporting new places to live, work and play in Toronto.” New land will be created around Essroc Quay to allow for the realignment of Cherry Street and construction of a new bridge over the Keating Channel. The Port Lands Protection Project aims to provide flood prevention through the creation of a naturalized mouth for the Don River and a new river valley. It will also unlock new land for parks, residential and commercial development. Construction of the Cherry Street project will be completed by March 2020. The Port Lands Flood Protection Project will take approximately seven years to complete. SOURCE: WATERFRONT TORONTO

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Roadwork improvements made for Newfoundland and Labrador Newfoundland and Labrador reported significant improvements to highway infrastructure in 2017. More than 600 kilometres of highway was paved, and more than 300 culverts were replaced. As part of the province’s five-year

provincial roads plan, tenders for roadwork were issued earlier in the year. This allowed contractors to take full advantage of a short construction season, according to the Department of Transportation and Works. “When we announced our five-year


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provincial roads plan in January, we were confident that awarding tenders earlier in the year would help contractors complete more work,” said Steve Crocker, minister of transportation and works. “With some tenders being issued this fall for road work next year, we will continue to do all we can to ensure contractors finish road work on time and on schedule.” Under the plan, road projects are prioritized based on safety, traffic volumes and input from motorists and the department’s engineers. Newfoundland and Labrador completed its first night time construction project, which paved sections of the Trans Canada Highway, in 2017. A pilot project to determine the best type of asphalt for the province’s climate and highway conditions was also launched. A stretch of road on the Trans-Labrador Highway between Red Bay, N.L., and Lodge Bay, N.L., was paved. The province also opened the Sir Robert Bond Bridge, located in Central Newfoundland, to traffic this past year. New pavement was added to sections of highway in the province, including Peacekeepers Way, Robert E. Howlett Memorial Drive and Pitts Memorial Drive. Paving of the Team Gushue Highway extension St. John’s, N.L., is expected to be completed in 2018. SOURCE: GOVERNMENT OF NEWFOUNDLAND AND


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Letter to the Editor


ER 2017





Good Day. This is a comment regarding an article in the Dec 2017 issue of the magazine. I take objection to the policy, put forward in the Software article, that persons should change their password every 30 days. This is a misleading and highly un-necessary policy. If frequent password changes are relevant, then the users should change their password everyday. No user or administrator would put up with that. No person who acquires a password for criminal purposes, is going to wait 30, 60 or 90 days, or whatever your policy may be, to use the password for illegal purposes. So changing it every 30 days has little or no impact on security. Users quickly figure out the way to change passwords with the least impact on their effort. So they know they can’t reuse the same password so the password “password1” becomes “password2” and so on. To keep track of what the number is they write it down and put a note somewhere around their desk. Dumb but common. A much more sensible, and secure policy is quite different. In no particular order here are 10 that can be a start to a more secure computing environment. 1) Make sure that a users password is ASSIGNED to them. This way it becomes less likely that they use a work password that is the same password as on all their social media accounts, and their personal email, and their on-line shopping, etc. 2) Make the password a phrase that is relevant to them and / or their work or family. Ask the user something about their family, home, or hobbies. Then make up a password that is easy to remember, and long but relevant to the user. So someone who has a large gardening hobby could have a password such as “1nthegarden”. 3) Make a rigid and adamant rule that no work password is to be EVER used for a login outside of work. 4) Make employees sign a statement on a monthly or quarterly basis, or on a time frame that is decided on internally, that they confirm that they do not use their work password on any other account. If they have, then a new password must be assigned to them. 5) Emphasize that they are liable for the misuse of their password. They must not write it down. They must not share it with other employees. 6) Ensure user access to server resources is controlled by detailed Access Control Lists. Using Groups that are defined by responsibility and role, allows for tight but easily managed access to the data needed for their job/role. 7) Ensure key apps have internal passwords within the software. No accounting or line of business software should be used, that does not have internal password functions that limit user access and functionality. Even the most rudimentary accounting software


allows for the PG. 24 creation of access/function control over individual users. Set these controls with TRUCKS 2018 PICKUP TRUCKS RE PORT need to IS YOUR DAT PG. 32 A SAFE? know / need CONTRACT ORS ARE AT RISK PG. 54 www.on-s to change itemag.c om LAW HANDLING as the HOLDBACK S PG. 58 over riding principle. 8) Change default passwords on all generic devices, such as modems, router, wifi access points, managed switches etc. No device should be left with default passwords and default users. Create and document the date and time, and the usernames and the passwords for these devices. These password documents must be maintained under lock and key by senior level employees outside the IT department. 9) Senior executives should have UNIQUE alternative administrative user accounts created for them. These are not their day to day user accounts. The password that they create should be documented in a separate location. This is to help protect against malicious activity in the IT department and to provide a back door if needed. 10) Do a background check on new hires for the IT department. Make sure all references are checked before hiring. You would be very careful about giving a new hire signing authority on your bank accounts. A criminal new hire in IT can cost your company far more that someone writing cheques. New persons from an outside contractor, should be vetted in a similar manner. Ask the outside contractor for the results of the reference checks made to hire the person. In summary, there are far more important things to do to ensure your data security than the forced password change. It does not increase data security. It annoys the user community. It leads to administrators having to reset forgotten passwords much more often, without adding to security. It adds unwarranted costs with no benefit. I have only been programming and doing network administration and support work since 1967, so I realize I might be regarded as a sort of newbie without much experience. Regards, Jim Haliburton PM #40065







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Saskatchewan, Alberta trade dispute risks investor uncertainty BY JILLIAN MORGAN


askatchewan has lifted its ban on Alberta license plates from government road and building project sites in the province. The decision came 12 hours before an independent panel under the New West Partnership Trade Agreement would strike a rule on the dispute. Still, the introduction of trade barriers creates a “race” for other provinces to follow suit, said Mark Cooper, president and CEO of the Saskatchewan Construction Association. For investors in the construction industry, and for contractors who work in multiple provinces, the ban could raise red flags. And, despite the resolution, businesses may price risk and uncertainty into bids. “It creates an unknown circumstance,” said Cooper. “Will the trade situations in the provinces change further without notice?” The trade agreement between Canada’s four Western provinces aims to eliminate barriers and improve access to trade, investment and labour. A violation of free trade rules under the agreement could have left Saskatchewan with a $5-million fine. “In the long run, that’s not good for the Western economy or for the Canadian economy,” said Cooper. “Trade barriers, whether

they’re inter-provincial or international, are not helpful for economic growth and for development.” But Cooper said the association is supportive of the Saskatchewan government implementing barriers where necessary. Saskatchewan Premier Brad Wall introduced the ban on Dec. 6, 2017 in response to claims of similar practices on Alberta job sites. The Saskatchewan Heavy Construction Association stated that Saskatchewan license plates were denied access in the neighbouring province. While Cooper heard this refrain from the province’s contractors anecdotally, he was surprised to hear the claims were widespread. “Saskatchewan contractors are not afraid to compete in a fair and reciprocal environment,” said Cooper. “Reciprocity is an important part of that.” According to Cooper, Alberta contractors also have a “natural six-point advantage” when it comes to the use of material in Saskatchewan because the province charges a PST. “When Alberta contractors buy material in their own province and bring it across the border, it can create an imbalance when it isn’t properly reported,” explained Cooper. All evidence of discriminatory practices

was anecdotal, and Alberta’s Minister of Economic Development and Trade, Deron Bilous, denied Wall’s claims. In response, the Alberta government initiated a process to have the ban reviewed by the New West arbitration panel. Prior to the suspension, Bilous stated in a Canadian Press article that Alberta’s recent beer mark-ups and rebate program, which was found to violate inter-provincial trade, would be reversed. In a letter to Bilous on Jan. 22, Saskatchewan Trade Minister Steven Bonk

FAST FACTS The NWPTA came into effect July 2010. Manitoba joined the partnership in January 2017. In Alberta, a non-resident must register a vehicle if it has been in the province for over six months. If the ban had gone through, Alberta contractors would license their vehicle in Saskatchewan on a temporary or permanent basis. In March 2017, Wall offered incentives to oil companies in Calgary to relocate to Saskatchewan. He rescinded the offer when Alberta Premiere Rachel Notley threatened arbitration.

Highway 5 passing lanes West of Humboldt, Sask.

A meeting between the two provinces was planned for Jan. 31 in the border city of Lloydminster – where resident contractors have opposed the ban – or the Saskatchewan-proposed Medicine Hat, Alta.

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Highway 7 twinning in Delisle, Sask.

said the government would suspend the license plate policy “in good faith” following Bilous’s comments. Wall tweeted shortly after the suspension that Saskatchewan will work with Alberta to “level the playing field” for contractors in both provinces. During a news conference, Bilous stated Saskatchewan was “grasping at straws” to find a reason to bring the ban

forward. “When you’re wrong – you’re wrong,” tweeted Bilous on Jan. 23. ”Brad Wall waited until the 11th hour to drop his ridiculous ban, which hurt businesses on both sides of the border.” In Bonk’s letter, he stated the two provinces should meet to discuss safety course harmonization and requirements for contractors, in addition to the creation of a

single resource to report issues when doing business in the neighbouring province. “Alberta and Saskatchewan are good neighbours and good friends as provinces and these kinds of things shouldn’t happen,” said Cooper. “When they do, we have to deal with them and hopefully move on and not allow it to change the trajectory of the relationship, which has always moved our provinces closer to each other.” / 17 ONSITE_House Ads Half Page LAZ.indd 1

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CONSTRUCTION STATS A selection of data reflecting trends in the Canadian construction industry

LOWEST UNEMPLOYMENT RATES SINCE 1976 Canadaâ&#x20AC;&#x2122;s unemployment rate fell to its lowest in four decades in 2017, with 51,000 jobs added to the construction industry. The Statistics Canada monthly labour force survey reported a year of growth across all industries. Unemployment rates landed at 5.7 per cent, the lowest since 1976. SOURCE: STATISTICS CANADA

CONSTRUCTION UNION WAGE RATE INDEX HOLDS STEADY The Construction Union Wage Rate Index (including supplements) for Canada remained unchanged in November compared with the previous month. The composite index increased 1.0 per cent in the 12 months to November. SOURCE: STATISTICS CANADA

NON-RESIDENTIAL CONSTRUCTION INTENTIONS IN 2017 SURPASS 2016 TOTAL The value of building permits for non-residential structures fell 12.3 per cent to $2.9 billion in November, following two monthly increases. The decline was spread over the three non-residential components (commercial, industrial and institutional). As of November, Canadian municipalities had issued over $100 million more in building permits in 2017 compared to the 2016 total, led by higher construction intentions for universities, hospitals and manufacturing plants. Initiatives such as the Post-Secondary Institutions Strategic Investment Fund, announced in the 2016 Federal Budget, may have contributed to the increase in the value of university building permits in 2017, while multiple high-value permits helped to drive up the overall value for hospitals and manufacturing plants. SOURCE: STATISTICS CANADA

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AHEAD O CURVE Success in the construction industry is all about pulling together diverse resources for the most efficient outcome. Similarly, contractors are finding that the “killer software app” isn’t any particular functionality, but the technology that enables multiple apps to work together efficiently. BY JACOB STOLLER


ational Research Council Canada (NRC) released a paper in 2008 titled Systems Integration and Collaboration in Construction: A Review. Its authors, Weiming Shen and colleagues, concluded “systems integration and collaboration are believed to be the key enabling technologies to help the construction industry to improve productivity and efficiency.” That statement is even truer today in an IT environment where collaboration is becoming the norm. “The field keeps moving in terms of the types of software you use, and the goal post keeps moving in terms of how much you need to connect in to make it work,” says Mike O’Neil, principal analyst of Toronto-based technology research firm InsightaaS. Contractors in particular must become adept integrators as they pull together multidisciplinary teams, multi-phase projects, contracted and salaried employees, equipment, materials, and an extensive portfolio of business partnerships. It should be no surprise that consolidating information from various aspects of the business is a mission critical function.

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Yet the technology that allows applications to share information and functionality is, for the most part, a mystery to most business owners. “That tier that holds application systems together is one of the most misunderstood aspects of IT,” says Steven Wilson, senior analyst with London, Ont.-based Info-Tech Research Group.

WHAT YOU KNOW AND WHO YOU KNOW Perhaps the most critical reason for exchanging information between apps is that it gives decision-makers visibility into the many resources that are tied to a particular activity. As O’Neil points out, that picture is far from clear for most contractors. “Right now, you have a rough idea where your trucks are, what’s on them, where your people are, and what they’re doing,” says O’Neil, “but if you get into a market where any one company knows all of that stuff a lot better than you do, then their margins will be such that they’ll push you out of business.” The problem is that critical information about trucks, personnel, and materials might be locked up in what IT people call “islands of information,” that is, sets of data that can only be retrieved by opening one particular app. So while a critical piece of information may be present in the organization, it may not be in front of the decision maker at the right moment. “If you can’t send a piece of equipment to a jobsite because it needs maintenance, that might leave a lot of people standing around, and cost you a fortune,” says Wilson. “We need logistical management and clear visibility on equipment to prevent that.” Establishing that visibility could mean, for example, that the scheduling function has access to equipment maintenance information, automatically raising a red flag if maintenance is overdue. The other driver for interoperability is the alleviation of manual processes, such as printing a report from one app and then keying the information into another. “Many contractors, even large ones, still use a lot of paper,” says Charles Cooper, president of Huntsville, Ont.-based excavation company Muskoka Hydrovac, “so they have a lot of people in back rooms just doing data-entry paperwork. This is not only time-consuming, but that’s where you get lots of your errors in the business.”

Systems integration and collaboration are believed to be the key enabling technologies to help the construction industry to improve productivity and efficiency.



Establishing and maintaining interoperability within an IT environment poses four main business challenges: The wide range of software functions in a construction environment – estimating, scheduling, project management, customer management, job costing, accounting – means there are many potential links to consider, and these are likely to be different for every company. The ability of a particular software package to share information in an IT environment typically depends on vendor-supplied Application Programming Interfaces (APIs), which make components of the software available to other programs. APIs are not always adequate for a contractor’s requirements. Integration is fragile in that it can break down when a component in the network, for example, an operating system, changes and a particular piece of software hasn’t been updated to the latest version, or if the software vendor hasn’t issued an update. Applications keep changing, so it’s hard to know where interoperability will be needed in the future. “Whatever it is that you think you need in construction today, you probably are going to end up adding stuff pretty rapidly to that over the course of five or six years,” says O’Neil. What’s needed is an ongoing strategy for ensuring the interoperability challenge remains at the forefront whenever IT priorities are being discussed.

MAKING INTEROPERABILITY PART OF THE CONVERSATION As a first step, Ken Eygenraam, solution designer for Toronto-based Quartet Service Inc., recommends doing what he calls a discovery. “One of the first check points is taking stock of what’s there, and that goes down to versions and everything, because sometimes what you want to implement will not co-exist with what’s already there,” he explains. Many contractors, Eygenraam points out, subscribe to the “if it ain’t broke don’t fix it” rule and use dated apps because they have worked well in the past. This can be a hindrance when trying to create an interoperable environment. It’s also important to care-

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fully assess new apps to ensure they won’t become dinosaurs. “Before you invest in an application, find out the vendor’s policy for updates,” says Eygenraam. “I’d rather buy an application where I have to pay an annual support fee and get new versions from time to time, rather than risk getting stuck with something that needs to be locked down and where nothing can be changed.” Cloud software vendors tend to issue updates more frequently than non-cloud vendors. It’s also necessary to look at the breadth of the vendor’s API, as well as its policy for maintaining it. Some organizations do an excellent job at this, with Google being a prime example. “Google provides APIs for all their apps, and this is the main reason why Google Maps has been so successful,” says Cooper. “Pretty much anybody can connect with it.”



Some vendors, particularly small ones of the niche variety, pay insufficient attention to APIs. Unfortunately, Cooper notes, this can be a spoiler for some of the most innovative new apps. “Not only do they sometimes not have APIs, but a lot of the APIs, when they do have them, are really closed world. They haven’t really thought out the features they want to share with another app. They don’t see it is bi-directional – what information do you want to put into another app, and how do you extract it? That’s a problem.” Another issue that comes up is integrated suites. While these can make life easier in many respects, there’s a danger of getting locked into an inflexible environment. “I’m typically not a fan of monolithic platforms, Because what happens is you never know how they integrate those systems,” says Wilson. He notes, however, that the approach can work in some situations if the suite has an integration layer for bringing in modules from other vendors. O’Neil believes a more modular approach is the way of the future. “We’re moving from customize to configure,” he says. “The notion of buying a package and then customizing it to meet your needs is something people don’t do anymore. They buy the components to address their business needs, and then configure those together via APIs. This is a great and flexible approach if you can work with people who can plug those APIs together for you.”

MOVING FORWARD If integration is the strategy, flexibility is the key. “You don’t want your integration to be like a brick wall, but more like Lego blocks,” says Wilson. “This allows you to achieve your initial goals while keeping the design open for future interoperability – changes, expansions, or whatever – without having to rip things apart more than you would care to.” “For most construction companies, your best bet is to find consultants you can work well with, and get them to solve your problems one at a time,” adds Cooper. “Don’t boil the ocean.” Although this may be unfamiliar turf, contractors shouldn’t be intimidated. “Don’t be scared of technology,” says Cooper. “It is your friend, and it will make you more efficient, and make your life easier.”



Jacob Stoller is principal of Toronto-based consultancy StollerStrategies. Send comments to

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Digging deep Major excavation and mining of Toronto transit project is progressing on schedule BY CORINNE LYNDS WITH FILES FROM METROLINX


riginally conceived as the Line 5 Eglinton by Toronto Mayor David Miller and TTC chair Adam Giambrone back in 2007, the $6.6-billion Eglinton Crosstown LRT is one of the largest transit infrastructure projects underway in North America, and it’s progressing on time, and on budget. Owned by Metrolinx and operated by

the Toronto Transit Commission (TTC), the line will be part of the subway system as its fifth route. The first constructed phase of the line will run entirely along Eglinton Ave. for 19 kilometres from the future Mount Dennis Station underground to Sunnybrook Park, after which it will run predominantly at-grade along the street’s median to Kennedy station, where

it will connect underground with Line 2 Bloor-Danforth and Line 3 Scarborough. “Offering 25 stations and stops, the new line promises to be faster than a streetcar, bus, or downtown subway,” according to “In fact, your Crosstown LRT vehicle will be up to 60 per cent faster than your current travel time.” On-Site caught up with Geoff van der

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AT A GLANCE • The Crosstown is one of the largest transit infrastructure projects underway in North America and it is happening in Toronto right now. • It is a light rail transit (LRT) line that will run across Eglinton Ave. between Mount Dennis (Weston Rd) and Kennedy Station. It includes: • A 10k underground portion, between Keele Street and Laird Dr. • Up to 25 stations and stops • Connections to 54 bus routes, three subway stations and various GO Transit lines. • A connection to the Eglinton Maintenance and Storage Facility located west of Black Creek Drive. • At the peak of construction in 2018, there will be between 3,000 and 3,500 workers at any one time working on the Crosstown project.


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• Station design is 90 per cent complete. • The vehicle maintenance and storage facility is nearing substantial completion, and will be ready to receive vehicles for testing in Fall 2018. • Mining is now underway at two of the three stations to be fully mined. The last will commence in Spring 2018. • Many of the stations will reach the end of excavation for their entrances and station boxes this year, and we will start building up, rather than digging down.

Lee, implementation and deputy project director of Crosslinx Transit Solutions-Constructors Metrolinx, to get an update on how construction is progressing. “Rather than a single project, this is a mega-project with 20 individual construction sites across the length of the LRT line. Each has a different schedule and is at a different stage depending on the construction method used,” explains van der Lee. He goes on to offer updates on key areas: • The utility relocations needed for all station construction are largely complete.

UNDERGROUND ACTIVITIES The primary underground activities for safe and effective excavation include the need to ensure removal of ground water, installation of supports for the excavation, excavation and concrete works. As work progresses, it will occur simultaneously underground and at street level. The limited activities visible to the public will include: delivery of materials, removal of soils, equipment and pipes necessary for dewatering and ventilation. In addition, a water treatment plant will be used to facilitate the majority of the dewatering required during mining. Occasionally, a vacuum truck will be required to support this activity, with every effort being made to minimize this occurrence during the overnight period.

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NOISE REDUCTION MEASURES As a result of construction and associated truck activity, some noise and vibration are being experienced.

GOING UNDERGROUND Mining and excavation are a big part of this project. The Crosstown includes a 10k underground portion, between Weston Road and Laird Drive, where 15 belowgrade stations are under construction. Eleven will be built using a “cut-andcover” method, and four, including Laird station, are being “mined.” Since the start of mining at Laird Station in August, progress has been steady. What started as a few steel supports drilled into the excavated wall has advanced, right in the heart of the city. “Mining in a dense urban area comes with its fair share of challenges, such as operational logistics in tight spaces and noise mitigation,” said Rachel Pattimore, communications specialist for the Crosstown’s Mined Stations. “By bringing in world-class engineers and other specialists, we can address issues proactively to stay on schedule.” There are many advantages to mining the stations, including fewer disruptions and inconveniences for drivers, residents and businesses. While crews work below the surface, there are minimal changes to traffic, people can come and go that much easier, and there is less impact on everyone’s daily lives. To facilitate mining, cranes are installed at each designated site to help transport equipment/material down below, and the excavated earth, back up. At Oakwood and Avenue, specialty overhead cranes have been installed that are controlled by remote control, and that excel at working in confined spaces. When the Oakwood overhead crane was installed, it was the first of its type in Canada. At Laird, lower density has allowed for the use of traditional tower cranes. With expected completion on target for 2012, the Crosstown will link to 54 bus lines, three TTC subway stations, UP Express and the Kitchener, Barrie, and Stouffville GO lines.

Prior to the work commencing, several noise mitigation measures were explored and a noise and vibration reduction plan was put in place. Noise barrier walls, ventilation silencers, rubber mats, alternative backup signals, enclosures for pumps and generators, as well as careful sequencing of the works to minimize night time delivery and hauling were all incorporated in order to minimize the impact that construction has on the local community. By expediting the construction process, this work also serves to help Metrolinx deliver better transit to the city on time.

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Excavators that

SUCK Not a new technology, but definitely one that’s gaining popularity BY NATE HENDLEY


ince 1995, Ontario Excavac has offered vacuum excavating services, primarily for municipalities and hydro companies. Much of the Vaughan, Ont.-based company’s work involves “potholing”— that is, locating underground utilities then removing enough soil in non-destructive fashion to expose pipes and cables. “The main advantage [of vacuum excavation] is that you don’t damage the utility when you see it, because you’re just washing the dirt away then sucking it up, rather than going in completely blind with a backhoe not knowing what you’re digging into,” explains Brett Tye, senior operations manager at Ontario Excavac. Vacuum excavating is a two-step process. A truck or trailer mounted vacuum excavator blasts high-pressure air or water through a pipe into the ground to break up the soil. Loosened soil is then sucked up by a vacuum system and stored in a debris tank or hopper. The process is sometimes called hydro excavation when high-pressure water is used for soil loosening. This

is the term Ontario Excavac prefers, as all the company’s excavating units use water power. Potholing is one of the most common vacuum excavating applications. The process can be modified and used to clear up sewer lines, remove water and debris from catch basins and flooded basements, suck up oil spills and cleanup construction sites, among other applications.

THE POPULAR CHOICE Regardless of application, vacuum excavating is gaining in popularity. “While vacuum excavation is still a relatively new technology, the adoption rate continues to increase daily,” says Ben Schmitt, product manager at Vactor Manufacturing, a leading producer of vacuum excavators in Streator, Ill. Proponents argue vacuum excavating is safer and less destructive than traditional excavating methods involving shovels or backhoes. Vacuum excavators have also become more advanced and powerful in recent years, which enhances their appeal.

Choosing between a vacuum extractor that uses high-pressure air or high-pressure water involves weighing several factors. “Water has its advantages. As far as clay based soils, you’re really not going to get anywhere with air only. Water has a lot more cutting power than air. And if you have to go through any frost in the ground, you wouldn’t be able to do that with air,” says Jim Zylstra, sales manager at RingO-Matic, a Pella, Iowa-based vacuum excavation equipment manufacturer. Special chemicals are not required for hydro excavation: water tanks can be filled straight from a hydrant or tap. Employees at Ontario Excavac “fill up their trucks at our shop, right from a city source,” notes Tye. “The advantage of an air system is that you have an unlimited supply: When water tanks run dry, you have to go back to refill. The other advantage of air is when you’re done excavating, you have dry soil that you can backfill. When you use water, you turn it into more of a mud slurry that you have / 31

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Last October Vactor launched the HXX-QX at a trade show. It offers improved weight distribution and performance.

to either let dry or dump somewhere,” continues Zylstra. Neither water nor air is powerful enough to blast through hard materials. When Ontario Excavac teams are faced with concrete or asphalt, their first task is to cut through these tough layers with saws before doing any soil extracting. That said, vacuum excavators are surprisingly sturdy machines, able to function with few difficulties in cold Canadian weather. “In wintertime, we have diesel-fired hot water heaters on the trucks that heat up the water to 45 degrees C to go through frozen ground,” states Tye. Vactor Manufacturing claims to have built the first dedicated vacuum excavator, in 1969. The original unit was designed for utility-detecting purposes in Brooklyn, N.Y. “However, the technology was ahead of its time and market acceptance was not gained until the late 1990’s, when Vactor introduced the HXX brand of dedicated vacuum excavators,” says Schmitt. Last October, Vactor launched a new HXX-QX vacuum excavator at a trade show in Louisville, Ky. The pre-production model HXX-QX offers improved weight distribu-

tion, performance and payload capacity, has a new PrecisionFlow water pump system that increases water flow and a display unit that shows real-time operational data. For its part, Ring-O-Matic “started with vacuum only equipment back in the early 1980s for cleaning up car wash pits. That’s how we got into the business. Then around the mid-90s, we came out with the vacuum excavator itself with water on board. And we’ve been at it ever since,” says Zylstra. “Our trailer-mounted units are our bread and butter, our main line of equipment. We build units as small as 150-gallon debris tanks and then we go up to 3,000-gallon debris tanks that we put on truck-mounted units. Our 550VX and 850VXs are the most popular machines and the ones that we build the most of,”

he adds. To highlight the advantages of vacuum extracting, Schmitt points to a recent report by the Common Ground Alliance (CGA), an underground utility industry association based in Alexandria, Va. On August, 2017, CGA released a study that pegged excavation-related damage to buried utilities (including steam pipes, sewers, natural gas lines, cable TV and water lines) at $1.5 billion. The CGA counted 323,962 “consolidated reports” of underground infrastructure damage in Canada and the U.S. in 2016 a 12.4-per-cent increase from the previous year. The report cited backhoes, trenchers and hand tools as some of the leading culprits responsible for this damage. “You hear in the news now and again about gas lines being hit or 911 service going down because a utility was cut by a

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The 550VX and 850VX are the most popular machines Ring-O-Matic builds.

which “limits the maximum water pressure the operator can use, per industry best practices,” he adds.


backhoe or some kind of other mechanical device. That’s the beauty of vacuum excavation. There’s enough high-pressure water or air to dig up the soil without potentially damaging the utility itself. So it’s actually safer than using a shovel because you eliminate any potential damage to the underground infrastructure there,” states Zylstra. Vacuum excavating is also safer for workers. Rupturing a gas line or power cable with a shovel or backhoe can have catastrophic results for anyone working nearby. Because it’s a gentler process, vacuum excavating is far less likely to cause an explosion or electrical discharge, says Tye.

THE TECHNOLOGY Vacuum excavating equipment has become more advanced in recent years. “We’re seeing higher and higher CFMs

(cubic feet per minute) on the machines. I think one of our first machines that came out was a 640 CFM blower. That was kind of standard at that time. We now have a 1,000 CFM machine,” states Zylstra, referring to airflow volume measurement. In terms of broader industry trends, “We’re starting to see more truck mounted units go out as opposed to trailer mounted units. There is still a big market for trailer mounted, but there seems to be a trend going to smaller trucks dedicated to vacuum excavators as opposed to the trailer … and we’re seeing more and more machines go out with booms on them. Full hydraulic booms,” he continues. Over the years, improvements on Vactor vacuum excavators have included enhanced boom operation, cold-weather features and control interfaces, says Schmitt. Vactor just received patent approval for a technology it calls DigRight,

As vacuum excavating becomes more common, new applications are being found for the process. “You hear every now and then of some machine being used for some odd job. Normally, they’re used for potholing and mud management along horizontal directional drills but we’ve sold some into the mining industry to go into plants to help clean up slag and the kind of stuff that comes with mining operations. We’ve sold them into agricultural areas for helping clean around grain bins and livestock facilities. Anywhere you can use a shovel or need a vacuum, you could potentially put one of these machines into use,” says Zylstra. “I know some people do get into other jobs, like roof work. Hydro vac trucks [are sometimes used] to suck gravel off rooftops. I’ve seen them do that before,” adds Tye. Tye hopes Ontario Excavac will continue to grow, while remaining focused on doing utility work in its current base of southern Ontario. He believes the vacuum excavating industry as a whole is going to expand in the near future. “I think it’s very fast-growing. It’s really taken off. I’ve seen a big expansion in the industry over the last three years, compared to when I started back in ’97,” he says. What’s pushing this expansion is the fear of “damaging utilities” and the subsequent fines and lost work contractors might incur as a result.

Nate Hendley is a Toronto-based freelance writer and author. Send comments to

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ON THE SHOW FLOOR There were many innovative new products on display at this yearâ&#x20AC;&#x2122;s World of Concrete. Here is a selection of On-Siteâ&#x20AC;&#x2122;s favourites from the 2018 exhibition CAT BREAKS INTO UTV MARKET Caterpillar has introduced its first-ever Cat utility vehicles. The CUV82 and CUV102D feature a rugged steel cargo bed and offer 1,000-lb. (454-kg) total rear cargo capacity and 2,000-lb. (907-kg) towing capacity for a wide variety of applications. These UTVs efficiently complete hauling tasks, quickly maneuvering over rugged terrain on the worksite at speeds reaching 45 mph (72 kmph), depending on model. The CUV82 is powered by a 0.8L three-cylinder gasoline engine delivering 50 hp (37 kW), while a 1.0L three-cylinder diesel engine delivers 25-hp (18.7 kW) power to the CUV102D.

GAME CHANGING MIXER TRUCK Terex unveiled the Advance Charger FDC300 front discharge mixer, a first-in-its-class truck design for delivering ready mix concrete to jobsites in congested urban areas. The new 3-axle city-class mixer offers a shorter concrete charge height, and delivers the same tight turning radius characteristics as traditional Terex Advance FD/FDB front discharge mixers. These new attributes of the FDC300 meet the expectations of concrete producers delivering concrete in densely populated cities. / 39

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STRENGTH-ENHANCING ADMIXTURE BASF’s Master X-Seed 55 admixture improves early- and late-age strength development in concrete. This technology is a stable suspension of synthetically produced crystalline calcium silicate hydrate (CSH) nanoparticles that facilitate the growth of CSH crystals between cement grains and improve the overall hydration of portland cement. The technology’s strength-enhancing property permits a reduction in the total cementitious material content of a given concrete mixture while maintaining the concrete’s compressive strength.

Topcon Positioning Group announced an update to its MAGNET Enterprise software system that will expand integration with Autodesk solutions with a new Autodesk BIM 360 cloud connection. The upcoming integration with BIM 360 is designed to allow MAGNET Enterprise operators to manage 2D plans, 3D models, and any other project documents in the BIM 360 Docs or Autodesk A360 Drive environments. The software is designed to streamline document management bi-directionally between the field and office and provide a dedicated location for sharing and saving the most updated project files.


COMPACT TRACK LOADER BOASTS GREATER LIFT AND HEIGHT The Bobcat T595 compact track loader is part of the M2-Series line of compact loaders featuring durability and performance enhancements that provide operators with increased uptime, improved visibility and a more comfortable cab. The vertical lift path provides increased lifting capacity and greater forward reach at full lift height. The T595 has a rated-operating capacity of 2,200 lbs. and an operating weight of 8,055 lbs. Complimented by a variety of attachments, the T590 has a Tier 4, 74-hp engine.

Combining speed, precision and lift capacity, the John Deere 344L compact wheel loader provides peak productivity for material handling, landscaping, snow removal and construction customers year-round. The 344L offers a faster travel speed with smooth auto shift technology up to 25 mph, ideal for customers who have larger job sites to traverse or for snow removal. The industry-exclusive Articulation Plus steering system allows operators to lift more during turns than leading competitive machines. Its design features an articulated frame plus rear-wheel steer, providing a tighter turning radius, improved stability and additional lift capacity.

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WOC Product Spotlight TRUCK INTERIOR DESIGNED TO ATTRACT DRIVERS The Mack Granite model featuring an all-new interior took center stage in the Mack Trucks booth. Designed with detailed input from thousands of drivers, the interior was developed to improve comfort and offer an ergonomic, driver-centric layout. One of the premier features of the layout is the new flat-bottom steering wheel, enabling easier entering and exiting of the cab. The new steering wheel also gives the driver a better view of the dash, and can be equipped with illuminated cruise control, Bluetooth and audio system buttons. The new gauge cluster and dash layout in the Granite model improves visibility and readability. Frequently used controls are within reach of the driverâ&#x20AC;&#x2122;s fingertips.

VOLUMETRIC MIXER OFFERS INCREASED ACCURACY Cemen Tech launched the latest addition to its C Series volumetric concrete mixer lineup with the introduction of the C60. The new model includes enhanced ACCU-POUR capabilities and Automated Gates as a standard option. ACCU-POUR is the nerve center for the C Series volumetric concrete mixer with one-button operation using the AP-Touch control panel, allowing for consistently accurate mix designs. The Automated Gates technology makes the C60 fully computerized and continues to reduce operator error by syncing the mix design with the appropriate gate setting for material flow.

TELEHANDLER WITH TRAVERSING BOOM The Pettibone Traverse T944X telehandler offers an extendable, traversing boom that moves loads by traveling horizontally. Up to 70 in. of horizontal boom transfer allows users to precisely and safely place loads at full lift height through tight openings without having to coordinate multiple boom functions. With the Traverse, the specified lift height of 44 ft., 6 in. is nearly identical to the 44-ft. landing height. This stands in contrast to a traditional fixed boom pivot, where the true landing height is generally several feet less than the advertised lift height, as operators must account for withdrawing the forks out of the load with enough rearward travel for the fork tips to clear the landing zone. The traversing boom allows for maximum forward reach of 35 ft., 10 in.

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WHEEL LOADER WITH UPTIME PROTECTION The Doosan DL280-5 wheel loader provides operators with enhanced performance and comfort, as well as increased uptime protection. The new model’s wide fin radiator provides more effective cooling with larger fin spacing, which reduces clogging. The heavy-duty axels deliver additional machine performance in harsh applications, and enables owners to use solid tires for enhanced uptime protection. An upgraded forward-neutral-reverse joystick is easier to activate and more ergonomic, improving operator comfort. It offers 172 hp and a breakout force of 30,249 lbf.

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LONG-LASTING PUMP KIT Putzmeister America, Inc.’s .13 HPD Pump Cell has been designed to work with the 39Z-Meter Truck-Mounted Concrete Boom Pump. The BSA-grade pump kit is claimed to be the highest-performing, longest-lasting pump cell on the market with a Rod Side output up to 180 yards3/hr (138 m3/hr), and Rod Side pressures of only 1,233 PSI (85 bar). It has been in development for a year, with 2,000 man-hours spent on its design. The .13 HPD Pump Cell was engineered with 2,500 lbs. of steel, which makes it robust enough to withstand high-pressure, high-rise job site conditions, as well as long-distance pumping. / 43 ONSITE_TWITTER1-2V_LAZ.indd 1

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RISK By David Bowcott

Take a step back for strategy


examples of how it will evolve to encompass a bigger role within local and global economies: New Delivery Models – The past 20 years has seen a migration away from the traditional design-bid-build model to a multitude of alternatives (Design-build, integrated project delivery, P3s or design-build-finance-operate-maintain, CM at risk, facilities management, etc.). Owners and construction stakeholders are experimenting in the hopes of finding a more efficient and productive way to build, and even operate assets. Horizontal and Vertical Integration – Construction stakeholders are expanding their role (especially the larger ones). Some contractors offer design, construction, equity/finance, facilities management and even own their supply chain. Technology – Never has there been more new technology solutions at the fingertips of construction contractors. Some nations like the UK, Germany and the US have government owners that are mandating the use of BIM. Others are starting to mandate the use of technologies born out of BIM. Don’t even get me started on the digitalization of the physical world and building nervous systems for all assets. Total Cost of Ownership – More owners are starting to recognize construction costs only represent 10 to 20 per cent of the present value of all costs associated with their asset — 80 to 90 per cent of the assets’ cost comes from the operations. How can the construction sector help owners save 30 per cent on their operational costs? I guarantee if you can prove to an owner they can save 30 per cent on their operations, they won’t be so concerned if the construction budget goes up. Much of the change that we are witnessing, comes from a few brave construction stakehold“Cities represent several construction projects coming ers who decided to take a step back from their primary role of birthing assets and decided to together to create a quality life for every citizen.” engage owners, financiers and governments to see if there might be a better way to design, build and operate assets, and even improve the efficiency within its boundaries. Construction has a lot of expearound how all assets are organized and integrated. Taking a step rience around integrating various asset types to ensure back and seeing the big picture, and where you fit in that big they operate most efficiently. Just look at some of the mega transit picture, is the easiest way for you and your company to plot your projects that bore tunnels underneath utility dense city streets and ideal future path. how they link transit stations to other commercial, residential and industrial facilities. They are the creators of the bones, arteries, David Bowcott is Global Director – Growth, Innovation & Insight, veins, and organs of the city. Global Construction and Infrastructure Group at Aon Risk Solutions. It’s a common belief among industry exerts, that the construcPlease send comments to tion sector is on the brink of significant change. The following are ate last year I was asked to speak at a Cities conference that was put on by Builtworlds, a network and community that links key stakeholders of the construction and asset management industry, with those in the tech sector. Matt Gray, co-founder of Builtworlds, explained in his opening remarks that the event was created based on his own experience working in construction. “When I was working in the construction sector we would pull drawings/RFPs, bid the work, execute the won work, and leave the job at substantial completion. We really only saw the structure we built and didn’t get a full appreciation for what that building meant to the city in which it stood,” said Gray. “If the construction sector could take a step back from its primary role and take a wider view beyond just the construction phase, it could unlock great potential. This is why I’m doing a conference on Cities. Cities represent several construction projects coming together to create a quality life for every citizen.” This statement struck me as profound, and I think we can agree that it’s timely given the global changes we’re witnessing. Design firms and contractors have so much untapped value to offer society and the economy. Who knows better how to get the most out of an asset, than the team that created it? When something goes wrong with a bridge, or a building, or a power plant, the owners rarely fix it themselves, they almost always call the construction industry. Further, the construction sector has a lot to offer governments and city planners as they organize assets in a way they deem to be the most efficient for the citizens that live

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CONTRACTORS & THE LAW By Lindsey von Bloedau and Krista Johanson

Don’t make these 5 mistakes about performance bonds


erformance bonds are common on construction projects, and so are misconceptions about them. Don’t make the five mistakes listed below.

1. “A BOND IS AN INSURANCE POLICY” While a bond has some similarities to an insurance policy, they are two very different ways to mitigate risk. A performance bond involves a three-party agreement between the surety and the principal (contractor), for the benefit of the obligee (owner). If the principal defaults on its contract with the obligee, the surety may choose one of several options to allow the project to progress as long as the obligee has performed its obligations under the contract and met any further conditions in the bond. For the principal, who has purchased the bond, it is important to understand that the bond protects the obligee. Unlike an insurer who will pay out to the insured upon the happening of the insured event (and may eat the costs), the surety who incurs costs in completing the contract is entitled to seek recovery of those costs from the obligee. For the obligee, who benefits from the bond, it is important to understand that when a claim is made, the surety, and not the obligee, gets to decide what happens next. The focus is on completing the work rather than on compensating the obligee for all of its losses.

2. “IF THE CONTRACTOR DEFAULTS, THE SURETY WILL WRITE ME A CHEQUE” The obligee is required to notify the surety of the principal’s default. At that point, the wording of a performance bond usually gives the surety four options after it investigates and satisfies itself that there is indeed a default: remedy the default; complete the contract itself; obtain bids for a contractor to complete the work under a contract with the obligee; or to pay the lesser of the bond amount or the proposed cost of completion, less the balance of the contract price. All of the surety’s options are for the benefit of the obligee, and allow the project in question to proceed, but the obligee cannot dictate which option the surety should take, or take completion into its own hands. An obligee who completes the work on its own behalf to the prejudice of the surety risks having its claim rejected.

3. “THERE IS NO NEED TO CALL THE SURETY UNTIL THERE IS A DEFAULT” A principal who is experiencing financial difficulties should discuss its situation with the surety before the situation reaches a head. The surety may be able to step in to alleviate the situation in order to

avoid or mitigate a default, although the surety is not required to take any action until the obligee declares the principal to be in default. Similarly, an obligee experiencing problems with a principal can seek to have the surety, who typically has an ongoing relationship with the principal, have a word with the principal or assist the parties in resolving a dispute. Even where the surety is unable to assist in preventing a default, contacting the surety in advance can give the surety a head start in its investigation of the situation, thereby potentially reducing the delay and interruption resulting from the default.

4.“A PERFORMANCE BOND PROTECTS SUPPLIERS AND SUBCONTRACTORS” Payment of suppliers, by either the surety or the obligee, in the event of a default by the principal is not required under a performance bond; that is the purpose of a labour and materials bond. Where the unpaid supplier is necessary to complete the scope of work under the contract, it may be convenient for the surety to pay any outstanding amounts owing to the supplier so they continue their work. However, it is open to the surety, and may be less costly, to contract with another supplier to finish the scope of work of the unpaid supplier, and leave the unpaid supplier unpaid (if there isn’t a labour and materials bond).

5. “I’LL GET AROUND TO MAKING A CLAIM EVENTUALLY …” Many bonds include a condition requiring the obligee to give the surety notice of a claim against the bond within a specified period of time. Where a notice requirement is included as a condition to a performance bond, failure to give notice within the time specified can bar a claim. Making a claim requires giving notice of an actual default and demanding that the surety perform its obligations; merely advising of a potential claim is not sufficient to meet the notice requirement. The specific terms of performance bonds vary and the above comments relate to typical bond forms. This article is provided for general information only and may not be relied upon as legal advice.

Lindsey von Bloedau is an associate lawyer at Borden Ladner Gervais LLP (BLG) and practices in the area of construction litigation. Krista Johanson is a partner at BLG. She practices in the area of commercial litigation with an emphasis on contract and construction disputes. Send comments to

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