President's Report - June 2016
We are searching for a new Member Services and Programs Coordinator to help enhance the ability for us to reach out to our members. Interviews are now taking place and it is hoped that we will have someone in place shortly.
Our surveys show strong support for the OGCA and its new website and Newsletter but there was a strong request for more personal contact. That is why we are taking the steps necessary to meet those requests and achieve the new Strategic Plan.
OGCA will begin a major overhaul of its IT and Communication systems over the next two years to better serve and reach our members.
I am pleased to report that our Golf Tournament once again sold out with a waiting list and that many past Chairs will be attending for golf or lunch. It will be great to see these exceptional leaders who helped guide the OGCA to where it is today. Minister of Labour Kevin Flynn will be our special guest, along with Rob Ellis of MySafeWork who we are partnered with in the League of Champions.
The League is gaining terrific support and growing as more OGCA members join, along with other trades and Associations. If you have not signed up to this great cause and campaign to change the safety "culture" in Ontario, don’t delay! Go to the OGCA website and find out how you too can be a safety "Champion."
Member renewals are at an all-time high with just over 70 percent of members renewing already and only two resignations: one closing -- one having been merged with another OGCA member. We appreciate your prompt response to the renewals.
Contract and Tender issues continue to dominate. At CCA, we heard from across the country three main concerns:
1. Prompt Payment and Lien Reform
2. Quality of Documents
3. Exclusion Clauses for Litigation
In regards to the first, we - and the rest of the country - are all awaiting the release of the Bruce Reynolds Report ordered by the government. Some feel that it has been purposefully delayed, and have taken to reporting on rumours and taking positions before the facts are known, going so far as to suggest nefarious actions by unidentified anti-change interests. OGCA members should not be concerned. First, we do know it is a lengthy and comprehensive report, some 300 pages and 100 or so recommendations. We do know that Mr. Reynolds and Ms. Vogel underwent a very thorough hearing from more than 60 parties, and they conducted interviews and consultations to ensure they heard everything that was necessary. Those of us who know Mr. Reynolds and Ms. Vogel are not surprised that they would be tabling a thorough and comprehensive report on this difficult issue.
Further unrelated events within the government required more time: the translation and publishing of the document to the government members responsible; the illness of one of the two ministers involved in overseeing the report; the Premier being on trade missions; and most importantly, the cabinet shuffle, meaning two new ministers must be brought up-to-speed before the report goes public. Such delays, while disappointing, are not some part of a scheme to delay the documents release as some would have you believe, going so far as to accuse the Attorney General’s office of not having the competence to review it and the government itself of not caring.
Such unfounded and inflammatory rhetoric belongs in theNational Enquirer, not on the pages of any reputable industry voice.
We believe that once released, and we do not expect that to be much longer, then the real work will begin. While no one knows exactly what is in it, we believe that it will be the start of a ground-breaking effort to reform the payment system for our projects in Ontario and will resonate across Canada. Its success will depend on the, so far, highly polarized sides putting aside their prejudices and personal agendas to work together side by side to achieve fairness and reform in the payment process for all parties.
Quality of documents and the procurement challenges we face here in Ontario are the same across Canada and getting worse. Industry stakeholders are getting angrier and angrier at the lack of respect and professionalism coming from those wanting to hire our services. Problems here in Ontario have escalated to public owners, supported by taxpayer dollars, refusing to hold public tender openings, instead going behind closed doors. Considering the fallout from the Charbonneau Commission, one would think public bodies would want to be seen as absolutely open and transparent. Instead, they are going the other way. That leaves the door wide open for the types of abuse found in Quebec!
OGCA members are fighting back, in many cases not bidding owners anymore or raising their risk factor. We keep hearing from these bad buyers complaints that they aren’t getting enough of the better bidders, but they refuse to look themselves in the mirror to find the answer. Recently, and for the first time in several years, OGCA members qualified a Tender, sadly with an owner with whom we thought we had a good relationship. As a result, the contract is being altered and the future contracts will be CCDC with agreed-to SGCs with the OGCA. Once again, OGCA members united to make a difference.
Through our offices and our membership in the CDAO, we continue to meet owners who are willing to talk and to make a difference. We continue to meet with IO to enhance and improve their real-estate systems of procurement. The next meeting is July 27, and I will be bringing up a number of issues reported to us just recently. Remember, if you do not report problems or issues, we can’t address them, so please let us know, not just about an owner like IO who is responsive, but any owner not practicing what we all know as "industry best practices."
We work closely with OAA and CEO to promote better practices that will help improve document quality, such as Qualification Based Selection (QBS), a topic now getting attention at CCA where John Gamble of the ACEC recently addressed members on this topic and ways we can work together to improve things. Sadly, too many owners are stuck in the old lowest price is best value fairy tale or nightmare and seem unable, unwilling or unable to try something new, even when it is a proven program. Municipalities commissioned the InfraGuide report some years ago and have since ignored its recommendations, preferring to continue to not pay for design and engineering, rather preferring the RFI and CO route for their projects, and then wondering why they have a problem
In short, the quality of documents is not just our problem. It is the owner’s problem, and until they are prepared to properly pay for what they need, we as contractors will suffer the consequences of incomplete documents, specifications, and more onerous clauses designed to shift risk to us, leaving owners to continue to wonder why they are having so many problems keeping their projects on budget.
The above leads us to the other major topic spreading across the country - "Exclusionary clauses" due to litigation. These are designed to eliminate the vexatious contractors and trades who just sue all the time with no real grounds for their case. There may be some bad apples out there. I wouldn’t begin to deny that, just as there are bad apples in medicine, politics, the law and every profession. But there are ways to deal with these bad apples without denying anyone their legal rights to justice.
The real problem here is not some out of control, court happy contractors. Rather it is what we just discussed: the lack of respect for our industry, lack of understanding on industry practices and poor investment in the design and engineering of projects. These problems lead to delay claims and litigation as owners’ representatives, for the most part, not knowing how to handle a dispute, allowing them to fester and at the end of the job, usually, all hell breaks loose and the finger pointing starts. So off we all go to the lawyers. Many times the problems are caused by owners just trying to be too smart for their own good by introducing all kinds of clauses to transfer risk, making the contractor and his trades responsible for any and all mistakes, delays or lack of information, complicated prequalification and tendering rules and systems. All of these tend to backfire and lead to legal challenges.
So the answer is let’s just threaten and intimidate the contractors into not suing us by refusing them any further opportunities to bid if they have the audacity to exercise their rights under the law and seek justice. In fact, in one Province, you could be banned if you even activate the ADR provisions within the contract!
Yes, let’s not actually fix what is wrong with our procurement system as we can’t possibly be to blame! It’s all those court happy contractors!
The two latest owners to try this are Halifax, where I had a meeting with a senior staff who seemed far more reasonable than whoever is pushing this, and I agreed to provide assistance in understanding better procurement practices. Geoff Wilkinson of ORBA is assisting in providing some direct information on how to deal with these clauses.
ORBA, as many of you may know, successfully convinced the MTO, with strong support from Minister Del Duca, to drop this unfair and restrictive clause from their contracts.
The City of Toronto set up an advisory group to help it improve its procurement of our services. While I was supportive of this endeavour, I had already participated in three previous attempts to make change and all three failed.
I am sorry to report that this effort has, in our opinion, failed. As well, there really is no interest in changing the culture within the City of Toronto. The meetings, rather than being collaborative, were simply opportunities for City staff to talk at us, go away to their mushroom farms, and then foist their own ideas and programs upon us. Keeping with this topic, at the last meeting, they revealed their new exclusion clause. It was clear our opinions meant nothing because we were informed it was already going to council!
The majority of members from the industry on this council are CDAO members and last Friday, CDAO issued a strongly worded letter to the head of the committee, Mayor John Tory and the advocate for this committee, Deputy Mayor Denzil Minnan-Wong.
This was for us the final straw of being used to justify the actions being taken by some City Staff and pretending that these meetings were a true consultation.
This is very disheartening, as we had made some progress having CCDC partially accepted within the City and the acceptance of CoR, but clearly there are too many "silos" and personal interests within the structure that will oppose real change. Without that real change, the City of Toronto may never reach that balance they are looking for to provide the needed infrastructure to Torontonians, which will mean higher taxes.
This has been a long report and it has just scratched the surface of the efforts your association is working on. With our new goals and strategic plan, we hope you will all see a more proactive association.
But for us to truly succeed, remember these famous words (slightly altered):
Ask not what your Association can do for you; ask what you can do for your Association