february 2008 undergrounder6 • the undergrounder / february 2008 head offi ce 9 cedar avenue...

UndergrounderTheO N T A R I O S E W E R A N D W A T E R M A I N C O N S T R U C T I O N A S S O C I A T I O NO N T A R I O S E W E R A N D W A T E R M A I N C O N S T R U C T I O N A S S O C I A T I O N

February 2008

LONDON SINKHOLE:Sinking Into a Hole New Level

INSIDE:Securing Positive Cash Flow: A Three-Step Approach for Identifying and Correcting Cash Flow IssuesCentury-Old Wooden Water Pipe Carries City’s HistoryHours of Service Regulations: The Latest Developments

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The Undergrounder / February 2008 • 5

MESSAGES 7 President’s Message

By Graeme Clark

9 Executive Director’s MessageBy Frank Zechner

FEATURES 10 Securing Positive Cash Flow: A Three-Step Approach for

Identifying and Correcting Cash Flow IssuesThere are things you can do to secure positive cash flow now and in the future.By Josh Stearns

15 Century-Old Wooden Pipe Carries City’s HistoryFisher Street reconstruction find will make an interesting museum installation at Discovery North Bay.By Dave Dale

19 Sinking Into a Hole New LevelDowntown Sinkhole Costs & ConcernsBy Kirsten Steindorff

21 Progress in Process - Hours of Service Regulations: The Latest DevelopmentsWe need to continue making the case to regulators that for the roadbuilding and heavy construction sector, special allowances are necessary, and that the time has come to make it happen.By Jeff Morrison

MEMBER PROFILE 25 Taming Terrain for 10 Years:

Maacon Construction Corporation“I’m the most fortunate guy in the world with these people around me. The wheel is only as strong as the spokes, and I appreciate everything these people bring to the company.” –David Wright, PresidentBy Catherine Stutt

30 Buyers’ Guide and Trade List

The Undergrounder is published for the Ontario Sewer and Watermain Construction Association (OSWCA)5045 Orbitor Drive, Unit 12, Suite 300Mississauga, ON L4W 4Y4Tel.: 905-629-7766, Fax: 905-629-0587

Published by Naylor (Canada), Inc.100 Sutherland Avenue, Winnipeg, MB R2W 3C7Tel.: 204-947-0222, Fax: 204-947-2047www.naylor.com

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Cover Photo Credit: Morris Lamont, Sun Media Corp.

MESSAGES7 President’s Message

By Graeme Clark

9 Executive Director’s MessageBy Frank Zechner

FEATURES

UndergrounderTheFebruary 2008

O N T A R I O S E W E R A N D W A T E R M A I N C O N S T R U C T I O N A S S O C I A T I O N

UndergrounderTheO N T A R I O S E W E R A N D W A T E R M A I N C O N S T R U C T I O N A S S O C I A T I O NO N T A R I O S E W E R A N D W A T E R M A I N C O N S T R U C T I O N A S S O C I A T I O N

February 2008

LONDON SINKHOLE:Sinking Into a Hole New Level

INSIDE:Securing Positive Cash Flow: A Three-Step Approach for Identifying and Correcting Cash Flow IssuesCentury-Old Wooden Water Pipe Carries City’s HistoryHours of Service Regulations: The Latest Developments

MEMBER PROFILE: MAACON CONSTRUCTION CORPORATION

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6 • The Undergrounder / February 2008

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Message from Graeme Clark, President, OSWCA

2008 – Our Actions, Not Mere Wants and Wishes, Make the Difference

Within days of returning from the 2008 Annual General Meeting as the newly elected President of the Association, I

had the privilege of spending about an hour directly with the Ontario Minister of the Environment, the Honourable John Gerretsen. I welcomed the opportunity to have an open discussion with the key political decision maker on several water related issues, most importantly, the aging Sustainable Water and Sewage Systems Act 2002, a piece of legislation that we simply call ‘SWSSA.’ We explained, and the Minister accepted the view, that if your house roof is leaking, you fix it straight away rather than continuing to replace your carpeting and furniture every time it rains. The same logic applies to our water and sewer systems.

It makes sense and saves money to replace aging watermains before they burst and cre-ate sinkholes like the ones in London and Toronto over the past few months. It makes sense and saves money to fix or replace leak-ing pipes and sewers instead of building and operating larger water treatment plants and pumping stations. One of the municipali-ties in our recent forensic accounting report had a pipe repair budget that was about one half of the value of their annual lost water. Even though there were huge savings to be realized by increasing the water capital and repair budgets, there was too much political resistance to make it happen.

That’s how SWSSA can help municipalities and help the provincial government. The vast

majority of the public wants municipalities to use their money wisely by investing in timely replacements of aging pipe, instead of spending large amounts on emergency repairs. While dozens of municipal councils are prepared to take some political heat for making the right long term decisions, many others are not and will continue to place short term political gain ahead of longer term financial best interests. Passage of regulations under SWSSA will force the reluctant municipalities to make decisions that are in the long term best financial interests of their municipal residents and customers, while at the same time allowing municipal politicians to say to resistant voters that we had no choice, it is provincial law. The province comes out ahead because they have demonstrated leadership by taking affirmative action on our municipal water infrastructure; we as taxpayers benefit because at last all municipalities will be making the right decisions to stretch their infrastructure dollars through full cost pricing for water and water services, and ensuring that money collected for water systems is not diverted into other programs.

Yes our Association is a strong advocate for SWSSA, but we won’t get proclamation in force and regulations because we chose to attend selected political fundraising events or because we happen to know key decision makers - we will get proclamation of SWSSA and regulations because it is the right thing to do for municipalities, for the Provincial govern-ment, and most importantly, for all of us who rely on municipal water and related services. In future Undergrounder issues we will outline how you can help to make this happen.


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Message from Frank Zechner, Executive Director OSWCA

Water Taking Permits – An Unreasonable Burden on the Construction Industry

We have long advocated for worker and indus-try safety; however, the current water taking permit system under

the Ontario Water Resources Act is add-ing unnecessary costs and delays onto the sewer and watermain construction indus-try.

OSWCA contractor members often take on work at subsurface elevations below the water table. We cannot avoid that depth because most sewers operate on a gravity flow basis. It is not uncommon for sewers to be located more than 20 feet below the road surface. Water services, for a variety of technical reasons, are also among the utilities that are buried the deepest in road allowances. Consequently, water taking permits for our industry are not discretionary; they are a mandatory safety requirement for the crews that install, repair and connect the pipes and works that make up our water infrastructure.

Water in a trench is a major safety hazard. Water creates a deadly electrical hazard for electric power tools and water can weaken trench walls and dramatically increase the risk of a fatal trench collapse. Water in a tunnel is no less of a safety hazard.

The prudent technical course of action for trenches below the water table is for the trench to be pumped out as quickly as possible and then proceed with the necessary work. The regulatory system, however, discourages a rapid dewatering process. If water is pumped at a rate of more than about 9 gallons a minute, a dewatering permit is required.

The costs and delays imposed by the need to prepare a detailed hydrological report and permit application, and await a minimum 30 day EBR posting for comments can add huge costs to municipalities who already have very limited financial resources for water infrastructure construction, repairs or replacement. Many recent water taking permits have taken several months to be issued.

The current water taking permit system fails to recognize that there is a much less significant environmental impact posed by short term, construction safety related water taking permits as compared to long term water taking permits for commercial purposes such as water and beverage bottling operations.

In construction dewatering the water is removed from the jobsite and most often returned through the storm sewer system to the water body or aquifer that generated the infiltration. The industry does not export the water taken out of the jurisdiction, nor can this use of water be defined as consumptive.

There should be an exemption for short term water taking permits that are taken to protect the safety of workers that are required to work in trenches or tunnels that are at or be-low the local water tables. In the alternatives, if exemptions cannot be provided, then there should be reduced administrative burdens as-sociated with water taking permits for trench and tunnel construction. An exemption for short term water taking permits for construc-tion safety purposes is the logical response to enhance worker safety, and to let us get on with the job of renewing our vital municipal water infrastructure.


Many contractors struggle with cash flow, juggling payments due with revenue received – and

often coming up short. Over time, poor cash flow can jeopardize the financial health of your company. But there are things you can do to secure positive cash flow now and in the future. This article presents a three-step approach for identifying and correcting cash flow issues.

Step 1: Identifying Problems Although cash fl ow problems can be

attributed to many factors, admitting you have a problem is the fi rst step to recovery.

Once you admit to having cash fl ow problems, you need to identify where those problems are coming from. Your construction software reports can help. Here are fi ve reports that can be used to identify cash fl ow issues before it’s too late to recover. 1. Analyze Cash Flow by Job. The

sobering reality is that many con-struction companies are one bad job away from bankruptcy. As each job progresses, it’s important to monitor how much cash is going out and how much cash is coming in. Negative cash fl ow should be a red fl ag that there is a problem with a job.

2. Monitor Over/Under Billings.Monitoring over/under billings is the key to maintaining a positive cash fl ow on your jobs. Over/under

Securing Positive

Cash Flow:A Three-Step Approach for Identifying

and Correcting Cash Flow Issues

billings amounts can be obtained by calculating how much should have been billed based on the work you have completed and then comparing it to how much was actually billed. Over billings need to be recognized as a liability (don’t buy a boat with your over billings!). Under billings can indi-cate a future cash fl ow crisis.

3. Factor in Committed Cost. To ensure that a job stays on or under budget, you need to factor in commit-ted cost. Many job cost reports fail to factor in the commitments made. Sub-contracts and purchase orders (POs) need to be put into the picture along with hard cost. Even if you haven’t been invoiced for POs or subcontracts, these commitments need to be looked at as future cost on the job. Running a committed cost report will show you the whole picture and identify prob-lems with your estimate early on. A committed cost report will also show you just how much cash you’re going to need in the future.

4. Measure Profi t Fade. The profi t cal-culated when bidding a job can fl uc-tuate dramatically as the project pro-gresses. Change orders might increase profi t while a poor estimate might de-crease it. Profi t fade needs to be mea-sured on each job to identify problems early enough to make profi t-saving corrections. To measure profi t fade you need to look at increases in both cost and profi t. Ideally, if you see a big increase in cost you should also see a

By Josh Stearns

contract increase due to change orders. If the value of your contract does not increase incrementally with cost, you need to identify why. If the original estimate was bad or you’ve performed extra work that hasn’t been billed as a change order, you may be headed for a negative cash fl ow situation.

5. Monitor Backlog. Your backlog can help you estimate what your cash fl ow situation might be in the future. Monitoring estimates-to-complete for earnings, cost and profi t will put a dollar amount on your backlog. This information will help project growth and also warn you of slow times with potential negative cash fl ow situations. If your backlog is shrinking, you want to make sure that you bid enough new work for the future. As you look at the information ob-

tained by these reports (individually and as a whole), you will begin to get an idea of how your jobs are progressing, whether or not you’re on budget and how healthy your cash fl ow is. You can have a job that comes in under budget, for example, that still jeopardizes the fi nancial status of your company by having negative cash fl ow throughout the job.

Many contractors use credit lines to circumvent cash fl ow problems – and ul-timately spend their profi t paying inter-est. While using a line of credit is neces-sary in some cases, the more profi table decision is to use your construction soft-ware reports to identify problems before you get into a negative cash fl ow situa-


tion. With the right tools and real-time information, you can make informed de-cisions to secure positive cash fl ow.

Step 2: Taking Action Once cash fl ow problems are identi-

fi ed, the next step is to take corrective action. Taking action to secure positive cash fl ow requires direct communica-tion, detailed billing and proper docu-mentation of changes to a job’s original scope. As you read through each action segment, make a note of how you can im-prove your processes to support positive cash fl ow.

Communication with Your StaffCommunicating to your sales and es-

timating departments that getting paid on time is very important and can often stop cash fl ow problems before they even start. Setting this expectation up front al-lows these individuals to focus on secur-ing work with general contractors (GCs) and owners that have a reputation for paying on time.

In the fi eld, communicating job prog-ress vs. budget spent lets project managers and superintendents know if their proj-ects are on target or if their crews need to work faster to stay on budget. By making sure that your jobs are progressing at the same rate as your budget expenditures, you can be confi dent that progress bill-ings will continue to cover overhead expenses.

Communicating with GCs and Owners

Before you start a job, fi nd out what payment terms the GC or owner is ac-customed to. Ask questions like: When should we submit our billing? When should we expect payment? What is the worst case scenario for payment terms? What is the best case scenario? What do we need to provide each time we submit a billing? How would you like change or-ders handled?

In addition, discuss issues such a proof of insurance, certifi ed payroll and lien re-leases and ask what issues have come up in the past that have delayed payment to vendors. Straightforward communication about payment terms and potential prob-lems will ensure that your invoice doesn’t get overlooked due to a technicality.

Communicating with Subcontractors and Material Suppliers

After establishing payment require-ments with a project’s GC or owner, you should communicate this information to the job’s subcontractors and material suppliers. Help these parties understand the payment terms for the job – and that you will pay them once you get paid. Explain the best and worst case scenario and touch base regularly until payment is made. By letting your subcontractors and material suppliers know what to ex-

335572_Hertz.indd 1 6/25/07 2:34:21 PM

pect around payment terms, you can of-ten avoid having to pay them before you get paid.

BillingsThe way you bill your scheduled val-

ues can really help to eliminate cash fl ow issues; most notably, by billing for preliminary items up front. For example, invoice for insurance expenses and tem-porary storage mobilization at the start of the job. To ensure that your initial costs are covered, you might even consider put-ting a higher profi t margin on these bill-


ing items to cover any unexpected costs associated with job startup.

CollectingWhen payment delays do occur,

collect aggressively. Remind the GC or owner of the project’s original payment terms and that you expect them to live up to their end of the agreement. Hav-ing a collection fall-back to the initial-ly-established terms can dramatically increase your chances of getting paid without further delay.

Putting Priority on Change OrdersEstablishing standardized processes

for managing change orders is the best way to help your staff secure proper ap-provals and avoid getting burned by unapproved or undocumented changes. Make it a priority to get the appropriate paperwork and documentation signed by the GC or owner so the approved change order can get on the next billing.

For optimal change order manage-ment, tracking documentation such as e-mail correspondence, faxes and other

paperwork in a single, electronic system is ideal. (Many AccuBuild Construction Software users have implemented ADMS [AccuBuild Document Management Sys-tem] to store this information.) Having a project data repository with change order correspondence will keep everyone on the same page and establish a proven pa-per trail if litigation is necessary.

As you begin to take action through di-rect communication, detailed billing and documenting change orders, you should begin to see a dramatic improvement in your cash fl ow.

Step 3: Maintaining a Standard of Excellence

Once cash fl ow problems have been identifi ed and you’ve taken corrective ac-tion to get back on track, the third step is to maintain a standard of cash fl ow excellence.

When it comes to cash fl ow, maintain-ing a standard of excellence is easy. All you need to do is follow a formula that I call fi lling the GAP. This formula has three simple steps that, when followed, produce great results. By fi lling the GAP, you can ensure that your company main-tains positive cash fl ow.

1. G = Goal EstablishmentThe fi rst – and most important – step

toward fi lling the GAP is to establish cash fl ow goals for each project and write them down. Statistics show that people who

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write down their goals have more than an 80% higher achievement rate than people who don’t. Writing down your goals will not only make them clear in your mind, but will also give you a gauge to measure results by. Write down your main cash fl ow goal for each project and establish milestones that must be reached in order to achieve the goal.

2. A = Assign Responsibility to Individuals

The second step toward fi lling the GAP is making sure that everyone involved in the project understands their individual responsibilities toward the cash fl ow goal. Establish who is in charge of maintaining and meeting the milestones for specifi c tasks, such as billings, job progress, pay-ing vendors, handling change orders and so forth, and make sure that everyone agrees that the division of work is fair and achievable. Write down each person’s responsibility toward the overall goal to solidify accountability. By assigning responsibility to individuals – and mak-ing them fully aware of what is expected of them – you will dramatically increase your chances of maintaining positive cash fl ow excellence.

3. P = Progress Tracking The third step toward fi lling the GAP

is to hold weekly job meetings to track the progress of your goals and milestones. Re-visit each goal to see if you’re on target. If individuals are not meeting their respon-sibilities, ask them why. Was the original goal unrealistic or did something unex-pected happen? If the goal is not being met because of unexpected or unrealistic situations, revise the goal and devise a method to overcome the obstacle. Weekly meetings that track individual and team performance demonstrate to your staff that you will hold them accountable for their commitments. They also allow your staff to take an active and ongoing role toward maintaining a standard of cash fl ow excellence.

Securing Positive Cash Flow: Tying it All Together

As this three-step approach demon-strates, securing positive cash fl ow is a dynamic process that requires ongoing effort by the entire project team.

The process begins by using your construction management software to identify and monitor potential cash fl ow problems. Next, you must take action to secure positive cash fl ow by focusing on direct communication, detailed billing and proper documentation of changes to a job’s original scope. And fi nally, to maintain a standard of cash fl ow excel-lence, you need to fi ll the GAP by estab-lishing goals, assigning responsibility and tracking your progress.

By taking steps to secure positive cash fl ow now, you will experience the ben-efi ts of a secure and stable construction company far into the future.

Josh Stearns is Vice President of Sales & Marketing at AccuBuild, developer of AccuBuild Construction Software. He can be reached by e-mail at [email protected] or by phone at 800-728-6853 x801. For more information about AccuBuild, visit www.accubuild.com.


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During the past 15 years, the OSWCA has received information from its contractor members that they have encountered wooden watermains

in active service. While we have no reliable records of the quantity of pipes remaining in active service, we have gathered some basic information on the construction and use of wooden watermains.

Wood-stave pipes are of two types: Continu-ous Stave, and Machine-banded Pipe. The pipes are made in all sizes up to about 20 ft. in diam-eter and for internal pressures up to 150 lb. per square inch, or higher. The wooden watermain recently found at North Bay is characterized as a “stave pipe.”

Century-Old Wooden Pipe Carries City’s HistoryBy Dave Dale

There’s still more research to be done, but Cliff Cowcill is sure a wooden water pipe found during recent Fisher Street reconstruction will make an interesting museum installation at Discovery North Bay.

Cowcill, a retired city maintenance shop supervisor and fl eet manager, is preparing a small portion of the oak stave pipe for a showcase stand.

He wants to include an explanation and illustration about how it was designed and where it was used.

While progress has been slow since suffering a heart at-tack, Cowcill said he’ll get things moving forward after the holidays.

He spoke to fellow city retiree Ab Dufresne this week and North Bay’s resident expert on municipal water and sewer services said the pipes were used to draw water from Lake Nipissing via the Gorman Street pump house.

A Primer on Wooden Water Pipes

The water was likely stored in a well and distributed from there using smaller pipes.

Large sections of the wooden pipe were dug up when the new water and sewer lines were installed.

“I think it was packed with mud. It was never glued togeth-er,” Cowcill said, describing how the dove-tail joints would seal in water after the wood saturated and then expanded.

“It swells up,” he added, with steel wire wrapped around the outside to hold the pipe together like an old rain barrel.

Severed from a section more than three metres long, Cowcill said they cut the steel wire and it unwound rapidly like a spring.

“I had a heck of a job getting it back on,” he said.

This posting was reprinted with the permission of ©2008 The North Bay Nugget, www.nugget.ca. Photos courtesy of Dave Dale and Cliff Cowcill.

Retired city employee Cliff Cowcill is helping Discovery North Bay prepare one of its museum installations, a portion of the century-old oak stave water pipe found during recent Fisher Street reconstruction. Cowcill said dove-tail joints would hold water when the wood saturated and swelled with steel wire encircling the outside.


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In addition to stave pipes, there were also hollowed out logs, but stave pipes were the most popular. Continuous stave pipe were usually manufactured in cradles at the point of installation. The staves are laid together in such a manner that the joints between the ends of the staves are staggered. The staves are held in place by wire bands and the ends of the wires are held fi rmly in cast-iron shoes. As for curvature, the pipe can be laid on curves with a minimum radius about fi fty times the diameter of the pipe. Machine-banded pipes were usually made in the factory and the staves are held together by spi-rally wound steel bands. The pipes are made in almost any length, and up to 20 ft. Adjacent sections of pipes are joined by collars which are placed around the outside of the pipe. The collars may be made of wood staves, cast iron, or steel. The pipes were slowly fi lled with water to allow the staves to swell and close leaks before the full water pressure is placed in the pipe. Connections to wood pipe were made by special iron castings which are fastened to the wood pipe.

The life expectancy of wood stave pipes was 50 years or more if installed properly. The weakest component was usually the steel or iron bands,


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which although coated with a tar-like substance, ultimately corroded. On the other hand, the highly com-pacted and dry backfi ll could extend the service life much longer than 50 years.

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By Kirsten Steindorff

On October 31, 2007 London was added to the list of cities that became a national symbol for our nation’s crumbling infrastructure. Literally a sinkhole, 10 meters wide and 2 meters deep

brought chaos and inconvenience to over 30,000 motorists who frequent one of London’s core intersections, Dundas and Wellington Road. The cause of the sinkhole was the rupture of a 30-centimetre diameter 60 year old watermain. In addition to the sinkhole, downtown London also experienced a power outage due to the leakage of the burst watermain into a vault containing four major electrical lines under the intersection. Sixty hours after the collapse, London Hydro was still assessing the damage of the electrical lines beneath the intersection as well as investigating damage to electrical substations outside the

By Kirsten SteindorffPhoto Credit: Morris Lamont, Sun Media Corp.

Hole New Level

Sinking Into a


core. The repairs of the watermain proved to be simple compared to the damage of the electrical lines. The vault that housed them was damaged by water and needed a new cement floor and brick walls. Only after the electrical vault was repaired was the city able to fill in the hole and repair the road.

Thirty four days later, the intersection was reopened but the impact of the sinkhole is still being felt by the City of London. The sinkhole left London residents pointing fingers at city councillors, and city councillors claiming it is the responsibility of Queen’s Park and Ottawa to maintain municipal water works. The reality is the problem affects everyone, but nobody is willing to take the responsibility to remedy it. Residents blame the councillors for improper budgeting and not spending the money required to upgrade the cities public works as needed. The councillors say they do not have the funding to fully maintain the city’s public works because they can not raise taxes without upsetting ratepayers. Would ratepayers rather suffer from the consequences and disruption of their daily lives caused by sinkholes or pay more through their water rates and municipal taxes?

The OSWCA commissioned a poll by Ipsos Reid of more than 500 London residents in early November 2007 and found that a majority of residents believe that the city should increase its spending on replacing old water and sewer pipes. The poll also found that while a majority of residents support the

idea of dedicating a portion of water-bill revenue to maintaining infrastructure, most surveyed aren’t wiling to pay increased water bills to deal with the problem.

The poll found that 83 per cent believe the cause of the burst main last month was the age of the pipes and the fact that they should have been replaced long ago, while nine per cent say that it was due to a lack of inspections and seven per cent believe that it was a random accident.

Meanwhile, councillors reluctant to raise taxes and water rates are blaming Queen’s Park offi cials, claiming it’s the provinces responsibility to pay for upkeep and installation of newer sewer and watermains in order to prevent future sinkholes. This fi nger pointing does not stop at the provincial level. Queen’s Park says the crumbling infrastructure is a nation wide problem and that it is the responsibility of the federal government to fi nance the repairs of crumbling roads bridges and sewers. One suggestion is Ottawa turning over 1 percent of the federal GST to cities, worth about $400 million annually to Toronto.

As to the impact on London water budget, the city’s water director, Paul McNally said that the repairs to London’s sinkhole costing at least $1.1 million would not push the city’s water department budget over its $5.5 million dollar budget.

Municipal taxpayers will feel the city pulling at their purse strings for that $1.1 million, but they will not have to pay any part of the additional expenses to private utilities whose businesses were

disrupted as a result of the sinkhole. To date, there has been no word on private businesses or merchants looking for compensation for flooding or loss of clients.

Regardless of whether the city is going over budget, or not spending its money in a manner is satisfactory to the taxpayer, residents need to realize that they are paying nonetheless. Old pipes in need of replacement are leaking, costing taxpayers across the province millions of dollars annually in leaking water; moreover, old pipes are a serious safety issue. Broken or leaking watermains have a less efficient water flow, which can result in reduced or no flow to fire hydrants and high rise sprinkler systems during emergencies. Municipalities now colour-code their fire hydrants to aid fire crews in determining hydrants with adequate water flow.

I t i s unfortunate that we must experience the crumbling infrastructure of our cities first-hand to understand the severity of the problem. We must understand that this is a real problem with serious and potentially fatal results. It is time to stop pointing fingers and start working towards improving our cities’ infrastructure.

The OSWCA has been arguing for decades that municipalities need to dramatically increase the repair and replacement of crumbling old water infrastructure. Hopefully decision makers across the province can learn from the London sinkhole and not wait for a broken pipe to leak into our basements before making the replacement of old sewer and watermains a much higher priority.


Progress in Process -

Hours of Service Regulations: The Latest DevelopmentsBy Jeff Morrison

Unbeknownst to many companies in the roadbuilding and heavy construction sector, January 1, 2007 marked

the start of revised “Hours of Service” regulations. These revised regulations were the product of over a decade of discussions between federal and provincial regulators, as well as the private sector. Yet, despite the long history involved in the development of the new regulations, the fact remains that governments did not incorporate the views nor the facts relevant to drivers in short-haul industries, such as roadbuilding and heavy construction. However, with sustained pressure from the Canadian Construction Association and others, there appears

to finally be some movement towards addressing the concerns of the roadbuilding and heavy construction community. Time will tell how successful those efforts will be.

By way of background, Hours of Service regulations restrict the number of hours that a driver of a commercial vehicle can work – the idea being to re-strict the drivers’ potential fatigue, and therefore reduce the risk of accidents or even fatalities while behind the wheel. There are several “cycles” of work that drivers can follow, based on working time and actual time spent driving. The typical daily cycles involve either 13 hours of straight driving, 14 hours of on-duty time (in which any driving time is combined with other work), or 16 hours of elapsed time.

What makes Hours of Service regula-tions even more confusing is that there are two sets of rules – one provincial, one federal. If a driver is considered “interprovincial,” meaning that (s)he has only even commercially driven within one province, then that driver falls under the provincial regulations. However, if the driver has crossed a pro-vincial boundary, even once in their career, they are then considered to be a federal carrier, or an “extraprovincial” driver, and therefore are subject to fed-eral regulations. Although federal and provincial Hours of Service regulations are harmonized as much as possible, the fact is that there are differences, not just between federal and provincial regulations, but among the provinces themselves. For instance, in Ontario, as

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of mid-2007, drivers performing winter maintenance activities such as snow-plowing are exempt from Hours of Ser-vice, since such activities are deemed an “emergency service” – however, that same exemption does not exist feder-ally, nor in most other provinces.

For many years, CCA has been mak-ing the case that the overall objective of the Hours of Service regulations – name-ly, to reduce fatigue-related accidents – is not applicable to short-haul drivers (usu-ally defi ned as a driver driving within a radius of 160 km or less). This claim

has been backed up by two American studies conducted by the Federal Motor Carriers Administration who concluded that for short haul drivers, “concerning fatigue, local/short haul drivers are more like workers of non-driving professions than long-haul drivers.” The reasons why this is so are obvious – short-haul drivers usually can sleep in their own beds, and they spend a big part of their day doing a variety of tasks, including loading and uploading supplies.

What is most troubling for the roadbuilding and heavy construction

sector are the economic and capacity constraints that Hours of Service regu-lations impose. Given that roadbuild-ing and heavy construction is gener-ally a seasonal business that is also very weather dependent, time is a key commodity for this sector. Regulations which impede the ability of contrac-tors to fi nish a particular job, simply because a driver may be restricted from performing their work due to the fact that they have used up their allowable regulated hours, could represent a real risk to completion times. This in turn could represent real costs to contrac-tors, in the form of late penalties, lost productivity, and additional costs to hire additional drivers – although in the existing tight labour market, it is questionable whether additional driv-ers can even be identifi ed.

Having said that, regulators are start-ing to sit up and take notice of the situa-tion facing the roadbuilding and heavy construction sector. After sustained pressure over the past several years by CCA, federal and provincial transpor-tation regulators represented by the Ca-nadian Council of Motor Transport Ad-ministrators (CCMTA) agreed in May 2007 to grant companies in the road-building sector a one-year “educational enforcement” period, set to expire on December 31, 2007. Furthermore, the CCMTA created a task force intended to look into the concerns of the roadbuild-ing/heavy construction sector. This task force, chaired by Ontario Ministry of Transportation offi cial Peter Hurst, was tasked with the job of developing potential solutions for addressing the concerns of the roadbuilder and heavy construction sector.

After meeting with Peter, it was de-cided that the CCMTA needed more information on the characteristics of the roadbuilding sector and the im-pact of Hours of Service on that sector. Therefore, a survey form was devel-oped, with a request to roadbuilder/ heavy construction fi rms to complete this survey over a 5 to 6 week period. At the end of the period, information on over 560 drivers had been collected – a highly representative sample. The surveys revealed that drivers were non-compliant with Hours of Service during


362098_Strongco.indd 1 12/28/07 5:01:24 PM

approximately 25 – 30% of their shifts – although the survey revealed that in 85% of the cases, drivers kept right on working (most likely a refl ection of the year-long “soft enforcement” period). It also found that the proportion of a working shift actually spent driving varied considerably – from 10% up to 100%. Perhaps most importantly, of the 560 drivers in the survey in the 5-6 week period, there were only 6 reported accidents, and of those, not one occurred when a driver was in non-compliance with Hours of Service – backing up CCA’s claim that fatigue and accident rates are not an issue for short-haul drivers.

Based on this data, CCA developed three recommendations for changes to the Hours of Service. One, that all juris-dictions consider winter maintenance as an emergency service, therefore exempting it from Hours of Service. Two, that service vehicles above a cer-tain weight threshold be exempt from Hours of Service, and three, that the calculation of Hours of Service hours for roadbuilding/heavy construction drivers be restricted to hours actually spent behind a wheel – in other words, non-driving hours would be excluded. These recommendations were present-ed to CCMTA at its meeting in October 2007, and will be discussed and debated over the coming months.

At this time it is uncertain whether federal and provincial regulators will act on the concerns identifi ed by the road-builders and heavy construction sector. At their October meeting, regulators agreed on the need for an “assessment process” whereby requests for such sec-tor-specifi c allowances could be prop-erly assessed and measured with regard to their importance to public policy objectives. As soon as this mechanism is fi nalized, the roadbuilders and heavy construction sector will be among the fi rst industries to undergo the process.

So clearly this has been a long road to hoe. However, for the fi rst time in a long time, progress is being made. We need to continue making the case to regulators that for the roadbuilding and heavy construction sector, special allowances are necessary, and that the time has come to make it happen.

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Member Profile

Maacon Construction Corporation

Taming Terrain for 10 Years

From the stubborn bedrock of the Canadian Shield to the shifting waters of the Great Lakes, the challenges of carving the earth are monumental, and efforts are often met with glacial resistance. Throw in legendary blizzards spawned by Georgian Bay streamers and summer traffic that turns area roads into hot-tempered parking lots, and it’s enough to make even the most dedicated

contractor yearn for a simpler life.

Evelyn Boucher, David Wright, Ray Evans and Diane Gardner

By Catherine Stutt

That’s exactly what David Wright ex-perienced 10 years ago when he stepped back from his contracting business to ponder other pursuits. While trying to ignore his love of building communities and taming this rugged terrain, he found that he could walk away from the busi-

ness, but he couldn’t hide - particularly when his former employees came knock-ing and drew him back into the life he never completely left.

“Ten years ago I was disgruntled with the industry and wanted out. I sat at home and tried to fi gure out what to do


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with my future,” recalls David. “One day, my guys showed up, said they had a core group of key people, and wanted me to start another company.”

Putting up little resistance to the idea, David jumped back into the life he thought he had left. “We secured contracts for pipe, got our bonding in place, and hired Diane Garner as our controller. We were good to go.”

Starting half way through that fi rst year, Maacon Construction Corpora-tion nonetheless brought in $1.5 mil-

lion in contracts. “Our fi rst job was doing catch basins at the IGA on July 1. We did a condo site next, and then started building subdivisions. The hardest part in the beginning was get-ting credit, but with our reputation with our key suppliers they worked with us as we grew and people know we pay our bills.”

Ten years later, the company com-pletes $12 million per year in con-struction. David also runs a trucking division, The Wright Group, from his

Midland offi ce. “A contact in the truck-ing industry suggested we get into the storage trailer business. We had a con-tact at Magna and that worked out well. A dedicated route was available, and we took that over. We just kept adding men and equipment and now we have 20 trucks running for Magna and TRW.”

Both businesses operate from the head offi ce located at 45 Robil-lard Drive in Penetanguishine. The complex includes the administration building, equipment yard, and main-tenance shop. The County of Simcoe rents one of the bays.

“Most of the construction work is public tender,” explained David, “but we also enjoy a very good relationship with engineers. We’re fi nding that owners are frequently negotiating di-rectly with us instead of going through the tender process.”

David credits his approach to the work, echoed by a loyal and profes-sional staff, as the company’s best asset. “One of our biggest attributes is that we’re honest. We do excellent work. Owners are not going to have a problem with us. We understand that a developer can’t miss a closing date because of us.”

“We’re not always the cheapest,” Da-vid acknowledged, “but we’re the best value and you get what you pay for.”

While Maacon Construction boasts a wide scope of expertise, the lion’s share of its work involves building the complete infrastructure for sub-divisions throughout central Ontario. Starting from greenfi eld status, this includes excavation, grading, storm water management, installation of water, sanitary, sewer, and electrical infrastructure and fi nal dressing with curbs, gutters, and asphalt.

“We enjoy subdivision work be-cause we’re working from a clean site,” explained David. “There are some great developers out there doing fan-tastic subdivisions, and we’re very happy that we get to play a role in those communities.”

Cities and towns are quickly con-suming available residential invento-ry, and David is seeing a not so subtle shift that is creating new suburbs in


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smaller cities and expansion of outlay-ing municipalities.

“Barrie is running out of land within the city limits, and we’re doing a lot of work in the surrounding communities of Angus, Springwater, and Alcona.”

Located 10 minutes south of Bar-rie on Hwy. 11, Innisfi l is experienc-ing a surge in development, including municipal infrastructure. A new town hall and a separate multi-use recreation facility are both currently under con-struction. Developers are taking notice.

“Innisfi l is the next big city,” pre-dicted David. “Our next big project is for Don Pratt of Pratt Developments. Don is a great developer and builder and we’ve completed a lot of work for him. We’re doing a 400 +/- lot subdivi-sion for him in Innisfi l.”

Similarly, Maacon Construction is participating in the expansion of Oril-lia. In the past decade, the city has ex-perienced tremendous growth, much of it on the west side of Hwy. 11. Once vacant fi elds are now home to a retail and commercial power centre and beyond that, tucked into the gently rolling hills that lead to Bass Lake is a residential development of unheralded proportions for the Sunshine City.

Mariposa Homes owner Angelo Orsi is the driving force behind this multi-phase development, and he is another valued customer of Maacon Construction.

The abundance of residential devel-opment throughout central Ontario allows the Maacon team to remain within a reasonable commute. “Our coverage area is generally within a two hour drive,” explained David. “We work from Bowmanville to Huntsville and throughout Muskoka and Simcoe County and into Parry Sound.”

Although subdivision servicing is the largest component of Maacon’s workload, the company has extensive experience installing watermains, and sanitary and sewer pipe for cities and towns across the region. “We serviced a lot of Muskoka with sewer and water mains a few years ago,” recalls David, noting that it isn’t always glamorous. “We’ve eaten our share of blackfl ies.”

Maacon includes unique projects in its portfolio. “We’ve done tough jobs,

deep jobs, and put a lot of pipe in the ground,” said David.

In 1999, Ellis-Don awarded Maacon Construction the $1.5 million contract for site services at the new Central On-tario North Correction Facility, also known as the Superjail.

Two years later, Midland’s Doral Marine Resort, Canada’s largest fresh water marina, was facing a crisis. Wa-ter levels were substantially lower than when the resort was built in the 1970s, and the basin was losing its ability

to harbour boats. Doral Marine con-ceived a $1 million plan that included dredging the basin and installing a new fl oating dock system.

Maacon Construction built a berm to hold back the waters of the Bay, and removed 130,000 cubic meters of sedi-ment. When the crews left, the basin boasted an average depth of almost three meters.

Throughout the years, Maacon has worked closely with large general con-tractors on signifi cant projects. The


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company did excavation and storm sewers for K.J Beamish in 2000, and worked with them again in 2002 on the Midland Wal-Mart, installing wa-termain and site services. In 2002, Maacon worked with Lafarge Con-struction, again installing watermain and site services, this time at the Zehrs commercial development.

Maacon did the site services for the North Simcoe Recreation Centre and while the company is known for its greenfi eld projects, it has made a name for itself on municipal work as well.

“That’s a different situation,” ob-served David. “It’s much easier start-ing from scratch because with munici-pal work, you never know what you’re going to get into, despite what the soils report says.” In reality, every bucket is a surprise. While working on a subdi-vision, the Maacon crews unearthed an Indian burial site. “That shut the project down while an archaeological assessment was completed. The town dealt closely with First Nations repre-sentatives and there is now a memorial on the site.”

Flexibility is the key to keeping cus-tomers coming back. There are two 10-person crews, and a service crew of six. Sometimes everyone is on the same project, but more frequently, they are working at different sites.

“We’re happy with our size,” stressed David. “Any bigger, and you have to feed the animal. The tail wags the dog. This is a perfect fi t for everyone.”

David is completely committed to maintaining a very content staff and continually credits the entire team for the company’s ongoing success. “We have four key people who process a huge volume of work in the offi ce and fantastic people in the fi eld. Everyone from management to the newest la-bourer is part of our success. I feel the same way about the truckers.”

“Typically there is a very high turn-over in this industry, and we went through a lot of people in the early days, but we have a core group that has been with the company since the beginning and now we have an in-credible group completely committed to the task.”

In addition to Diane Garner, the controller, the offi ce staff includes Ray Evans, the general manager of construction, Evelyn Boucher, who primarily works for the Wright Group (the trucking division) and David. There are an additional 26 members in the fi eld, including Guy Jeannotte who started as a pipe layer and is now the superintendent, Dan Powell super-intendent, and Gary Rosen, the senior superintendent.

“I’m the most fortunate guy in the world with these people around me. The wheel is only as strong as the spokes, and I appreciate everything these people bring to the company.”

Construction and trucking are both at times unpredictable industries and maintaining a reliable team is a con-certed effort for David. “We treat our people well and have fun. We don’t yell and scream; we believe in posi-tive reinforcement and family always comes fi rst. If someone needs time off for the kids, they take it.”

“We take time off and we take work home. We do what needs to be done and we do it together.”


202 South Blair StreetUnits 34 and 35Whitby, ONP.: 1-866-295-6838www.midcomfg.com

We serve the Sewer & Watermain construction industries with a full range of metal products, ladders, sump grates, brackets, spindles and accessories.

OntarioConcrete PipeAssociation

CANADIANWELDINGBUREAU

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Insight, not hindsight.

1-800-363-3116 www.multiview.ca

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David counts the past ten years among his many successes and it il-lustrates the camaraderie on which he places a premium.

“This isn’t rocket science. In the end, we’re just moving dirt and laying pipe,” simplifi es David. “We adopt an old-fash-ioned way of doing business – treat peo-ple well, work hard, and pay the bills.”

Maacon Construction has benefi t-ed from its reputation, but David says that word-of-mouth advertising works in many ways. “You get to know who you want to work for and we have an excellent client base. Word gets around, and that lets us know when to protect ourselves. There is a lot of trust in our industry. We can order a million dollars of product in a month and then wait for payment. That’s a lot of fi nancial ex-posure, so we’re very careful in select-ing our jobs, because a lot of people are counting on us. We research our clients and if we don’t know them, we’ll ask around. It’s a small circle in this indus-try and reputations travel.”

Maacon Construction is particular-ly concerned with protecting not only

its employees, but its subtrades as well. “We have great relationships with our subcontractors. We’ll often sub out the clearing and grubbing, earth-works, as well as electrical, curb and sidewalk, and paving. We believe we utilize the best subtrades and suppli-ers in the industry. Once you surround yourself with good people, you can do anything.”

Nurturing good relationships with industry professionals lets Maacon successfully tender a broad scope of work. David describes the company as mid-sized with the expertise to accom-plish anything asked of it.

That’s going to be put to the test over the next year. “We have a lot of work lined up for 2007,” reveals David. “The next year looks very strong. Mu-nicipalities are focussing on infrastruc-ture and a lot of area mayors made that part of their platform in the last elec-tion. Municipal leaders know that sew-ers are in a dilapidated state and we’re seeing a lot of spending in that area.”

Looking back, David realizes that his guys came knocking at the right

time. “Interest rates and the Canadian dollar have been steady over the last 10 years. We haven’t gone through a recession in that time, and there has been incredible growth in every sec-tor. Even if it slows down a little this year, it’s still growing at a phenom-enal rate.”

Standing on the granite steps and looking out into yet another Georgian Bay blizzard, David recalls the last de-cade with a smile.

“It’s been a great run.”

MAACON CONSTRUCTION CORPORATION

Web: www.maacon.comTel: 705-549-1066 • Fax: 705-549-2402

Catherine Stutt is a freelance jour-nalist specializing in profi les of con-struction companies and large scale construction projects. With 25 years experience as a professional journal-ist, she has covered construction and economic development exclusively for a decade. Catherine can be reached at [email protected].


ACCOUNTANTS/MANAGEMENT CONSULTANTSRosenberg, Smith & Partners LLP ................. 8

AGGREGATESFPL Aggregates............................................24Hard-Co Sand & Gravel/Construction ..........14

AUCTIONEERSMidco Manufacturing ...................................29

BONDING & INSURANCECunningham Lindsey Canada Ltd. ................. 8Jones Deslauriers Insurance Management, Inc. ..................................30Masters Insurance Ltd. .................................. 8Stevenson & Hunt Insurance Brokers Ltd. ............................................27The Guarantee Company of North America ........................................24Thomson Jemmett Vogelzang .....................18Travelers Guarantee Company of Canada ...............................................14

BORING & DIRECTIONAL DRILLINGEarth Boring Co., Ltd. ................................ OBC

CONCRETE PRECASTERSJ. A. Porter Holdings (Lucknow) ...................18

CONCRETE PRODUCTSAnchor Concrete Products Ltd. ....................13Cedar Infrastructure ....................................... 6Munro Concrete Products .............................. 6

CONSTRUCTION EQUIPMENT RENTALS & SALESCrane Supply ...............................................24

CONSTRUCTION LASERSDirect Equipment Ltd. ..................................16Ontario Laser Rentals Ltd. ...........................17

CONSULTING ENGINEERSTerraprobe Ltd. ............................................12The Thompson Rosemount Group, Inc. .......18TSH Engineers Architects & Planners ..........23

CONTRACTORSAecon Utilities ..............................................18Drexler Construction Ltd. .............................14Sons of Samario ..........................................24

CONTRACTORS - PAVINGInterpaving Ltd. ............................................24

Buyers’ Guide & Trade List

GENERAL COVERAGE

Liability Fleet Equipment Wrap-UpEnvironmental LiabilityDirectors & Officers

SURETY BONDING

Same Day Bond IssuanceRepresenting All Major SuretyOver 100 years combined experience

INSURANCE SOLUTIONSFOR THE SEWER & WATERMAIN INDUSTRY

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Stephen Hall 416.248.7144

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PIPE SUPPLIERSRoyal Pipe Systems .....................................22

PIPELINE EQUIPMENTRapco Equipment, Inc. .................................17

PRECAST CONCRETE PRODUCTSAnchor Concrete Products Ltd. ....................13M Con Products, Inc.....................................18

PRECAST STRUCTURESAnchor Concrete Products Ltd. ....................13

PUMPSITT Flygt ......................................................IBC

SEWER & DRAIN INSPECTIONEye-View Drain Services Ltd. .......................14

SHORINGDirect Equipment Ltd. ..................................16Ontario Laser Rentals Ltd. ...........................17

STORAGE TANKS & RESERVOIRSAnchor Concrete Products Ltd. ....................13

SURETY BONDSStevenson & Hunt Insurance Brokers Ltd. ...27The Guarantee Company of North America ........................................24Travelers Guarantee Company of Canada ...14

TRAFFIC CONTROL PRODUCTSAnchor Concrete Products Ltd. ....................13Stinson Equipment Ltd. ................................30

TRENCH BOXESDirect Equipment Ltd. ..................................16Ontario Laser Rentals Ltd. ...........................17

TUNNELING CONTRACTORS & ENGINEERSMcNally Construction, Inc. ...........................18

UTILITY LOCATING & MAPPING SERVICESMultiVIEW Locates, Inc.................................29

VACUUM EXCAVATINGOntario Excavac ...........................................17

VIDEO PIPELINE INSPECTION EQUIPMENT & SOFTWARECues, Inc. .....................................................27

WATERJETTING & INDUSTRIAL VACUUMINGAquablast Corp. ...........................................24

WATERWORKS PRODUCTS SUPPLIERSCorix Water Products ..................................... 8Crowle Fittings & Supply Ltd. .......................12Robar Industries Ltd. ....................................28Wamco Supply, Inc. .....................................28Wolseley Mechanical Group.........................26

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CONTRACTORS - SEWER & WATERMAINSons of Samario ..........................................24

EQUIPMENT SALES, RENTAL & SERVICEBattlefield Equipment Rentals ..................... IFCHertz Equipment Rental ...............................11Ontrac Equipment Services, Inc. ..................16

EXCAVATINGOntario Excavac ...........................................17

GROUNDWATER CONTROLAtlas Corp. (The) ............................................ 4

HEAVY EQUIPMENT SUPPLIERSStrongco Equipment ....................................23Toromont Cat ................................................. 3

MANHOLE - CATCH BASIN FRAMES & COVERSCedar Infrastructure ....................................... 6

MARINE CONTRACTORSMcNally Construction, Inc. ...........................18

METAL FABRICATINGMSU Mississauga Ltd. .................................14

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