The Ontario Construction Report – January 2013 – PAGE OCR 5

The Ontario Sewer and Watermain Construction Association (OSWCA) hasscheduled its forty-second annual conference for Ottawa Feb. 10 through Feb. 13.

Finance minister James Flaherty is scheduled to address the association at a re-ception at the Canadian Museum of Civilization on Feb. 12.

Other presentations and events include discussions about social media, an openforum round table discussion, and an Ontario Ministry of Labour seminar.

The OSWCA is an association comprised of several relevant local and special-ized associations across the province. Overall it has about 700 members. For moreinformation, visit www.oswca.org.

Ontario sewer and watermain industrysurvives challenging 2012 economy

Ontario’s sewer and watermain contract-ing industry is evolving with changes in leg-islation, procurement practices andtechnologies. The industry, building on morethan $70 billion in assets throughout theprovince, works in spaces primarily “out ofsight, out of mind” to the general public,until something goes very, very wrong –such as the Walkerton water crisis lastdecade or, more recently, the Ottawa-areahighway sinkhole experience, where a free-way driver discovered himself undergroundwhen a tunnel collapsed.

Economic challenges, includingbundling of jobs into massive, multi-hun-dred-million-dollar projects, risk transferringto contractors, and government curtailments(especially in Toronto) have created seriouschallenges for many sewer and watermaincontractors in 2012, says Stephen Hall, apartner with surety and insurance brokerJones DesLauriers Insurance ManagementInc.

“In Toronto we previously were doingthree contracts a week,” he said. “This year(2012) it is more like three contracts over-all.” (Hall, who has worked in the insuranceand surety business since 1989, is chair ofthe Surety Association of Canada and chairof the young executives committee of theGreater Toronto Sewer and Watermain Con-struction Association.)

Many of the projects that have come online in the past year have been gigantic ones,requiring incredible capital and resources,too large for smaller and medium-sized con-tractors to bid on or achieve bonding (evenmore challenging because of their depletedbalance sheets.)

As competition for the fewer availablejobs intensifies, contractors are bidding atextremely low margins just to keep somework coming in – a risky proposition, if theyare seeking work outside of their areas ofprimary knowledge or expertise. Hall hasdozens of clients – but there are those goingout of business under the pressure, and onlya handful are making a reasonable profit.

Still, all is not doom and gloom.Hall and other observers indicate that

2013 may be a much better.year. Infrastruc-ture work may be delayed, but it cannot stopcompletely, and failure to maintain thesewer and watermain system can result inexpensive, urgent repairs. (As well, Hallsays political uncertainty which has plaguedboth Toronto’s municipal government andthe Ontario provincial legislature will be re-solved early this year and “we can expect aclear plan on infrastructure spending.”)

In 2012, industry leaders expressed joyabout the passing of Ontario One-Call leg-islation, and dismay about the impending ar-rival of the Ontario College of Trades. Theyexpressed concerns about the increasing sizeof tendered infrastructure projects – makingit harder for smaller and medium-sized local

contractors to achieve bonding requirementsfor the work. And contractors, engineers andassociation leaders observed concerns aboutpossible labour shortages, coupled with anappreciation that new technologies are re-ducing costs, increasing safety and enhanc-ing productivity.

“As an example, 30 or 40 years ago, wewould have had a crew of five or six people,to advance a tunnel two to three metres ashift,” said Dave Marsland, an engineer em-ployed at Technicore, which manufacturesmining and tunnel equipment and serves un-derground projects largely in the GreaterToronto Area (GTA). “ Now we can advancea tunnel 10 or 15 metres in a shift with thesame number of workers.”

Marsland emphasizes that you cannotsimply extrapolate one job or era to another– underground work, by its nature, involvesunique and challenging circumstances. Con-tractors need some reliability and contractsecurity to justify the costs of purchasing thelatest tunnelling and other technologies –and in attracting, training and retaining theskilled work-force to operate underground.

(Unlike other areas of the constructionindustry, where trades and apprenticeshippaths can be clearly defined from the outset,underground work requires specialized train-ing and skills – and these are generally ac-quired on the job, with experienced handsassuming supervisory responsibilities.)

Not surprisingly, several relevant associ-ations have joined the employer coalitionagainst the Ottawa College of Trades. TheOntario Sewer and Watermain ConstructionAssociation (OSWCA) is one of theOCOT’s most vocal opponents, expressingconcerns that the new institution will aggra-vate, rather than help to solve, growinglabour shortage issues in the industry.

“We believe the Ontario College ofTrades will not fix this problem and are call-ing for its abolishment,” OSWCA presidentMark Van Bree has written in the associa-tion’s magazine, The Undergrounder.“Sadly, the implementation of the college isaggravating the problem by not addressingapprenticeship reform which would go along way towards training skilled workersand addressing the shortage. The chargingof a membership fee by the college is simplyan unfair taxing of the working tradespeopleof Ontario.”

Associations opposing the OCOT in-clude, among others, the Conestoga HeavyConstruction Association, the Durham Re-gion Heavy Contractors Association, theGreater Toronto Sewer and Watermain Con-tractors Association, the Hamilton and Dis-trict Heavy Construction Association, theHeavy Construction Association of Toronto,the Heavy Construction Association of Re-gional Niagara, the Kingston ConstructionAssociation – heavy construction sector, theLondon District Heavy Construction Asso-ciation, the Ontario Concrete Pipe Associa-

OneCall success, prospectsfor New Year give industry

hope for future

OSWCA to host annualconference in Ottawa

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STAFF WRITER– The Ontario Construction Report

PAGE OCR 6 – January 2013 – The Ontario Construction Report

With an increased environmentalfocus, dewatering on infrastructure proj-ects has become more challenging, buttechnological advances are creating newopportunities for specialists includingAquatech Dewatering Company.

Aquatech president Andy Ingrisellisays, while his company may havebegun in 2006 as a groundwater dewa-tering specialist, the business has ex-panded its scope. “Our early workfocused on allowing infrastructure workto continue below ground where highgroundwater tables were a factor, but wequickly recognized the need for a lot ofdifferent pumping services and we nowoperate more as a complete fluid man-agement company.”

Ingriselli says Aquatech now sup-plies pumping services that delivers arange of pumping services from extrac-tion of groundwater right up to transferof slurries; they also establish temporarybypasses of sewers and creeks as well assupplying temporary fire pumps andthey specialize in emergency responseservices. “Dredging of storm water man-agement ponds is another new area ofour business,” he says. “Especially insouthern Ontario where it seems a lot ofthese ponds are in need of maintenancenow and the best method is dredgingwhich is a less intrusive and an environ-mentally safe way to do what needs tobe done while keeping them online andfunctional.”

Applying the technologies at handand adapting global technologies to On-tario’s environment, Ingriselli says hisbusiness has been able to fill a void hefeels no one else has served effectively.“The demand for our expanded servicesis high,” he said. “We accepted both thechallenge and the responsibility in tak-ing on this larger function.”

Aquatech’s experts can contributemost effectively when they are consultedbefore projects commence. “What welike to see, and what is happening more,is our involvement from pre-construc-tion through wrap-up, a complete man-aged solution,” Ingriselli says.

He says that it is vital to anticipatethe needs and requirements of all stakeholders. “We work closely with the reg-ulators and engineers to ensure we are

meeting compliance requirements whilemeeting the intent of the project needs.We work with professionals like engi-neers, hydrogeologists, biologists andecologists and other specialists to ensurewe are following best management prac-tices and that in all cases, potential envi-ronmental impacts are minimized.”

Ingriselli says increasingly work isyear-round, with “no winter shutdowns”in the past five years. “Planning is moreproactive to get over weather challengesin many cases, and necessity and expe-rience combined ensures we keep upwith advancing technologies.”

He speaks of working in Ontario’strue north where winter protection andheating systems keep water moving in -40 degree weather. “The key is monitor-ing so we can be alerted at early stagesof any potential problem to preventfreeze-ups and sites supported by auto-mated backup equipment that take overif mechanical problems occur.”

As with all sectors, recruiting quali-fied people is a challenge but Ingrisellisays as the company, and its reputationgrows, more people with infrastructureand environmental experience are dis-covering Aquatech. “We recruit a lot ofyoung people, provide training and inthat way the company grows organicallybut attracting people with strong experi-ence helps us grow in many other ways.”

Ingriselli says part of that growth isadding people to specific positions likeapplication engineering, quality controland safety to ensure they not only com-ply but exceed standards. “It can be achallenge though finding people withexperience especially from a consultingbackground who can work at the accel-erated pace of construction and keep upwith the needs of an active or emergencyproject, but we have successfully assem-bled a very strong team.”

“The industry is growing,” he says.“Companies who used to simply rentpumps and handle their own pumpingrequirements are not handling their ownfluid management any more. Insteadthey want a one-stop shop with special-ists who can provide a turn-key dewater-ing solution, including the permits andmonitoring reports that go along with thejob today.”

For more information, seewww.aquatechdewatering.com.

Aquatech Dewatering Company expands scope to meet

environmental, year-round fluid management challenges

STAFF WRITER– The Ontario Construction Report

tion and the Sarnia Heavy Construction As-sociation.

Dave Marsland at Technicore says thelabour shortage in the tunneling sector hasincreased in recent years. This can be seenin both challenging and positive lights. Inpart, (despite the rather serious industrychallenges in 2012) the reason for the labourshortage is increasing demand and commit-ments for infrastructure spending as agingsewer and watermains are replaced andmodernized – and new projects are intro-duced. Tunnelling, Technicore’s speciality,has its own requirements. “We get by. It’sbeen tight. We find operators and teach peo-ple – it can take 24 months to learn theskills,” he said.

OSWCA’s president Mark Van Bree haswritten that the industry is making progressin encouraging young people to considercivil construction as a career, similar to theOntario Civil Construction Careers Institute(OCCCI), initiated by the association. “Lastyear, OCCCI, supported by the OSWCA,spoke to more than 15,000 students, offeringpresentations and hands-on experience,demonstrating that construction jobs areavailable, attractive and do provide prosper-ity.”

The industry has expressed concernsabout the rising size and scale of projects.Contractors who could successfully competeand win $20 million projects are shut out be-

cause of bonding limitations on $200 millionmassive jobs, which (for capitalization rea-sons) often land in the hands of large for-eign-owned contracting businesses.Marsland and others say there are still op-portunities for local businesses as sub-con-tractors, but the “risk premium” of the largerjobs drives up costs, more than offsetting theperceived administrative simplicity of thelarger projects.

Some of these concerns have been ad-dressed by Infrastructure Ontario, which isnow taking into account local capacity in de-termining successful bidders, but many in-dustry leaders believe more can be done toincrease the opportunity for smaller firms tocompete – creating an environment wherethere is more opportunity for competitivebidding and, presumably, overall lower tax-payer costs.

Meanwhile, the industry experienced asignificant challenge in 2012 when a badlycorroded tunnel failed under Highway 174 –a major highway in the Ottawa area. Adriver survived a harrowing experiencewhen his car was “swallowed” by the roadin a sinkhole. Emergency replacement withthree metre diameter concrete pipe resultedin more than $5 million in constructioncosts, what the Concrete Pipe Journal reportsas being “almost three times the cost of aproject that had been previously planned tore-line the deteriorating tunnel, and does notinclude the operational costs associated withthe sinkhole, such as policing and traffic op-erations.”

OSWCAContinued from page OCR5–––––––––––––––––––––––

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The Ontario Construction Report – January 2013 – PAGE OCR 7

“The Highway 174 sinkholeshould be a wakeup call for munici-palities across Ontario and for theprovince of Ontario,” the newsletterreported. “The damaged pipe was in-spected in the summer of 2011 andidentified as in need of renewal, butthere was no indication that it was atrisk for collapse according to offi-cials at the City of Ottawa.” A post-mortem investigation commissionedby the city found deficiencies in theinvestigation and asset managementprocess.

However, one 2012 news eventrepresenting a “win” for the industryis the introduction of mandatory one-call utility locator dig legislation.This legislation, encouraged by theunderground industry and supportedpolitically by all parties, became lawlast summer before the Liberal gov-ernment prorogued the legislature.

The Ontario Underground Infra-structure Notification System Act2012 (Bill 8) “will ensure that onecall notifies all owners of buried in-

frastructure within the area of aplanned excavation: every ownermust be registered with ON1Call,”the previously voluntary ON1Callservice reports. “Municipalitieshave until June 18, 2014 to registerand all others must be registered byJune 18, 2013.”

ON1Call says the mandatory leg-islation will ensure 100 per cent par-ticipation, helping to overcomeupwards of $63 million in annualdamages from utility disruptions.“More than 1,000 utilities and otherowners of buried facilities will joinON1Call over the next 22 months,with the majority joining over thenext 10 months,” the non-profit or-ganization says on its website.

Stephen Hall at Jones DesLauri-ers, meanwhile, encourages contrac-tors facing tough times to bethoughtful about their internal busi-ness processes and careful aboutwhich contracts they bid. “You needto look at your day-to-day operationsand see where there are some ‘leakyfaucets’ – there are many ways toimprove and and stabilize efficien-cies, productivity and profitability,”he said.

OSWCAContinued from page OCR6–––––––––––––––––––––––

Brock Aggregates predicts shortages as approvals process ties

up licensing applications

Brock Aggregate in Concord traces three decades of history as a privately-owned supplier of limestone, sand and gravel.

However, the current environment – and possible serious shortages in thenot-to-distant future – are causing the long-established business to be verycareful about projects it is willing to supply.

Sales vice-president Orazio Valente says the biggest trend and challengefacing the industry is finding quality suppliers of aggregates and sourcing ma-terials. “The past few years we’ve seen many licensing applications denied,”he says. “In Ontario, it seems to be a case of, when in doubt, or when there istoo much opposition, deny the grant.”

Valente says the licensing process can cost $10 million or more and manyapplications fail. “In some cases, applications are denied based on public con-cerns over noise pollution, truck traffic or the excavation of open fields butthose same people don’t understand how much aggregates are used and thequantities needed,” he said. “People talk about recycled materials being an al-ternative when in many cases, they really aren’t.”

Valente cites the example of an infill project removing four older homes tomake room for a 10-storey condominium. “There simply isn’t enough recycledmaterial available from those homes to support the new construction. And,when we’re talking about large infrastructure projects requiring stringent spec-ifications for concrete and stone, recycled materials are too contaminated tomeet the project needs.”

“As populations continue to grow and more housing and infrastructure workis needed, the demand for aggregate rises,” Valente said. “People don’t un-derstand that it is everywhere – under roads and parks, supporting drainageand water delivery…. At some point common sense will have to prevail andpeople will have to understand virgin material is needed and has to come fromthe ground.”

In the meantime, Valente says his company is becoming more selectiveabout new projects. “We are anticipating a shortage,” he said. “We understandwe can’t commit to supplying every project that comes up so we look closelyat the amount of material involved and the application. For now, that’s enoughbut ultimately people will see costs rise significantly and projects that simplywon’t happen.”

Valente believes the potentially severe shortages may result in a supply cri-sis – forcing the issue into the forefront and possibly resulting in changes forthe better.

STAFF WRITER – The Ontario Construction Report

PAGE OCR 8 – January 2013 – The Ontario Construction Report