Construction in Vancouver - Issue 1406 by GLACIER MEDIA DIGITAL LIMITED PARTNERSHIP dba BUSINESS IN VANCOUVER

VRCA news feature

O c t o b e r 1 1 – 1 7, 2 0 1 6 v R ca . b c . ca

2016 Awards of Excellence

FINDit

UBC Student Union Building by Bird Construction Group, 2016 Awards of Excellence Gold winner in the General Contractor Award over $45m category

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construction B2 Innovation is leading by example

PROVINCIAL VIEW B7 When’s the last time you left $1 million on the table?

REDUCE, REUSE, RECYCLE B10 Be more green to make more green

B4 DAY IN THE LIFE With Karen Crouser, electrician with Western Pacific Enterprises

CONSTRUCTIVE COMMENT B8 Small business is the engine that drives our economy

LEGAL SPECS The lien trust and bankruptcy

EDUCATION B6 Back to school has never been so important

BUSINESS B9 Business succession planning in the construction industry

Spotlight B12 Skilled newcomers can be much-needed construction industry entrants

Sharing your viSion. BUILDIng SUCCESS.

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October 11–17, 2016

special news feature | Vancouver regional construction Association

B2 news CONSTRUCTION: Innovation is leading by example Trends emerge from the 2016 Awards of Excellence By Sarah Hitchings

h i s y e a r ’s Va n c o u ve r Regional Construction Association Awards of Excellence was one of the most competitive in recent memory. The judging panel had the unenviable task of selecting the Gold winners from more than 150 submissions, spanning 45 projects. “The judging committee spent six weeks visiting sites, receiving presentations and deliberating over the winning projects,” said Tony Everett, chair of the judging committee. The Gold Award winners were announced at the 28th Awards of Excellence Gala on October 5. (See full list of winners, page B3.) W h i le t he se awa rd s c elebrate the achievements of the construction industry’s finest companies, they also provide insight into where the industry as a whole is heading. This year, judges noted a number of key trends among the winners: the use of wood, the number of live sites, and the emergence of highefficiency heating and cooling systems, many originating from overseas and available through local sources. Advances in wood B.C. has one of the world’s most sustainable and globally competitive forest sectors. The province’s Wood First initiative promotes the use of B.C. wood products, with the overall aim to encourage a cultural shift toward viewing wood as the first choice for construction. Wood technologies, structural wood and exposed wood in design were seen in many of this year’s submissions, as engineers and architects develop innovative designs and practices for this highly durable material. Wood has been seen this year in a combination of design and structural features. Wood played a major role in the roof that Western Archrib manufactured for the Grandview Heights Aquatic Centre.

Main Street station renovations by Graham Construction and Engineering LP, 2016 Awards of Excellence Gold winner in the General Contractor Award $15m to $45m category

The stunning roof drapes over the 50-metre pool like an ocean wave. Wood was chosen for the roof structure for its ability to withstand high humidity; gluelaminated (glulam) beam roof systems have often been used in aquatic facilities for their resistance to warping. The University of British Columbia’s new Student Un ion Building featured heavy timber innovation. A combination of glulam and sawtooth trusses in the atrium helped create an open, bright and inviting gathering space. Wood was also used extensively throughout the Audain Art Museum. The challenges of live sites As space comes at a premium and older construction cries out for refurbishment, increasingly complex projects are abundant, resulting in the construction industry working on more “live sites” than ever. Construction compa n ies, contractors a nd tradespeople are now regularly navigating operational sites that pose unique challenges.

Graham Construction and Engineering LP was recognized for its work on the Main Street station renovation. Throughout the project the site remained operational with more than 20,000 people using the station daily. Given the public-facing nature of the project and TransLink’s com m itment to exceptiona l customer service, Graham Construction provided training to its construction staff so they were able to handle customer queries. Any work done above or beside the tracks had to be completed between the hours of 1:30 a.m. and 4:30 a.m., making scheduling a top priority. The mechanical refit of The View, formerly a jail, was completed by PML Professional Mechanical Ltd. The bottom floor of the eight-storey building houses a working law court, so any construction noise or vibrations were kept to a minimum to avoid disrupting court proceedings. Maintaining normal operations, managing traffic, abiding by

Grandview Heights Aquatic Centre by Western Archrib, 2016 Awards of Excellence Gold winner in the Manufacturer and Supplier Award category

Audain Art Museum by Pocklington Building Systems Ltd., 2016 Awards of Excellence Gold winner in the President’s Trade Award $1m to $3m category

continued on page B3

We Share Our Experience. We Deliver Dynamic Solutions. We Build WE Strong Relationships. SHARE OUR EXPERIENCE. WE DELIVER DYNAMIC SOLUTIONS. WE BUILD STRONG RELATIONSHIPS.

environmental assessments contamination management construction monitoring habitat restoration

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Working with BC’s Construction and Development Industry since 1991

Robert H. Lee Alumni Centre & Vista Point at UBC Photographers: Edward Chang & Robert Stefanowicz

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news 2016 Awards of Excellence Gold Winners PROJECT AWARDS Manufacturers and Suppliers

Western Archrib for their contribution to the Grandview Heights Aquatic Centre Electrical Contractors - Up to $2 Million Alpine West Systems Electrical for their contribution to the Audain Art Museum Electrical Contractors - $2 to $8 Million Houle Electric Ltd. for their contribution to Northern Rockies Regional Recreational Centre Electrical Contractors - Over $8 Million Western Pacific Enterprises GP for their contribution to the Evergreen Rapid Transit Project Mechanical Contractors – Up to $3 Million PML Professional Mechanical Ltd. for their contribution to The View Mechanical Contractors - $3 to $8 Million Trotter & Morton Building Technologies Inc. for their contribution to the UBC District Energy Centre Mechanical Contractors - Over $8 Million Division 15 Mechanical Ltd. for their contribution to the UBC DES Phase 6-9 DPS & UBC DES Phase 6&7 ETS

UBC District Energy Centre by Trotter & Morton Building Technologies Inc., 2016 Awards of Excellence Gold winner in the Mechanical Contractors Award $3m to $8m category

Construction Continued from page B2

noise restrictions and meeting tenant expectations have increased the need for collaboration like never before, not only between trades, but also with municipalities, law enforcement and communities. Overseas technologies Adva nces i n env i ron menta l technologies from Europe and

Asia are influencing new builds in B.C. Innovative green technologies seen in cooling towers, boilers and heat exchangers were seen in several winning submissions, including the UBC District Energy Centre, constructed by Trotter & Morton Building Technologies Ltd. W here geothermal systems were once seen as the most sustainable choice for managing a building’s heating and cooling systems, now highly efficient

technology from overseas offers architects and engineers less expensive alternatives, especially when working in confined site locations. “Changing economic and environmental forces are spurring the construction industry ever onward,” said Everett. “This year’s award winners are paving the way for innovation in B.C. They are embracing new technology and practices and showing us all what’s possible.” •

Chairman's Trade Award - Up to $1 Million Seagate Consulting Ltd. for their contribution to Grandview Heights Aquatic Centre President's Trade Award - $1 to $3 Million Pocklington Building Systems Ltd. for their contribution to the Audain Art Museum Founder's Trade Award - $3 to $8 Million Southwest Contracting Ltd. for their contribution to Vancouver House Buildings 1 & 2 Phase 1 Director's Trade Award - Over $8 Million Gallagher Bros. Contractors Ltd. for their contribution to A-B Connector General Contractors - Up to $15 Million PCL Constructors Westcoast Inc. for the YVR Expedited Transfer Facility - Package 2 (ETF2) General Contractors - $15 to $45 Million Graham Construction and Engineering LP for the Main Street Station Renovations General Contractors - Over $45 Million Bird Construction Group for the UBC Student Union Building

October 11–17, 2016

special news feature | Vancouver regional construction Association

B4 news DAY IN THE LIFE: With Karen Crouser, electrician with Western Pacific Enterprises Construction in Vancouver spent the day at the Port of Vancouver By Hayley Woodin

Karen Crouser, electrician with Western Pacific Enterprises, watches carefully as engineers connect power cables capable of transferring over 11,000 kilovolts of power

n a classic Vancouver morning in the haze of heavy rain, Karen Crouser operates a crane that slowly cranks the biggest ex tension cords you’ve ever seen. “Normally it’s a little bit drier,” she says, laughing, as she gets her equipment in place. With precision, and a confidence that comes from experience, she ensures all the pins, connectors and cords are in order before they transfer 11,000 kilovolts of power to the Coral Princess: an 1,800-passenger cruise ship set to dock within the hour at the Port of Vancouver. Crouser has 10 years’ experience with Western Pacific Enterprises under her belt, or, to be precise, her high-voltage protective jacket. An electrician by trade and a forewoman at the port, she helps connect cruise ships to shore power. “We’re plugging in a small city, that is what we’re doing,” said Crouser as she inspected four 35-pound receptacles. “This ship will draw more than Canada Place will draw today. When the big boys come in, it’s like two Canada Place buildings,” she added. And that’s just enough to keep a hotel load running. With pools, movies theatres and casinos – which typically aren’t even running at the dock time of 7 a.m. – cruise ships run on a lot of power. And when they arrive in Vancouver, they connect to the port’s grid. Crouser helped install shore power at the port in 2009, and at the time it was the first such installation in Canada. Since then, she and her colleagues have connected well over 100 cruise ships each season. “It was very interesting – I got to do electrical work out of a boat,” Crouser said. “When you’re an electrician, you’re not just going to be attaching wires to plugs or receptacles. You’re going to be moving heavy things, you’re going to be piping, running conduit, installing a whole bunch of different components to make the overall project complete.” From April to September, and even in a few months outside of prime cruise season, Crouser watches ships sail into 999 Canada Place. After her ground checks, she watches the vessel’s positioning to ensure its alignment and angle will work for the gangways. As she does this, she waits for the ship’s chief electrician to disembark and check her work, just one of many safety protocols for a job that involves high voltages,

big ships and responsibility for the safety of thousands onboard the visiting vessels. The job also involves a high degree of communication, not only between Crouser and her counterparts onboard the ship, but also with the site’s longshoremen and other workers. She also oversees the communication that happens between the computers and devices that are automatically and constantly signalling updates. “There are lots of different facets of what goes on at the dock,” said Crouser, who makes sure it all gets done safely and in sequence. For about two months in the winter when cruise traffic stops, Crouser works as a wire-woman. Last year it was on the Evergreen line; she’s also worked on the Vancouver Convention Centre, the retractable roof at BC Place and the library and Simon Fraser University campus in Surrey’s growing city centre core. “It’s really a matter of where my company needs me at that moment, with the skill sets I have, said Crouser. “I like to think I can go to a lot of different places.” She said the flexibility of her job gives her options, especially with a newborn daughter, adding, “I would definitely recommend a career in trades for my daughter.” It’s also the flexibility and the change in challenges that makes Crouser’s work exciting. In her “office” – the lunchroom that looks out from the port onto the Coral Princess and Vancouver harbour – she said her approach to her work, which has been honed through continuous education, could be summarized as not just knowing how to use a set of pliers, but also figuring out all

the ways to make use of them. But of all she gets to do – meeting new people, tackling new challenges, the creativity, the critical thinking – it’s having a hand in physically building a legacy that stands out to Crouser. “I’ve worked on a lot of large projects in Vancouver, and my children will get to see all of those buildings,” she said. “These are buildings that will be here for the duration of the rest of my life.” For Crouser, the grey Vancouver sky’s the limit – or she can swap it for another province or international work with her recognized Red Seal ticket. “If I’m lucky, I might get to go install another shore power installation for a container shipyard for the port authority, or I can go and do another highrise or another commercial building,” she said. “It’s really a matter of what’s getting built in the area I want to work in and where I want to be.” • Established in 2012, the Construction Foundation of BC is d e dic ate d to the advancement of the construction industry, with a focus on education and research. The Construction Foundation of BC is the proud sponsor of the Day in the Life video series that accompanies these articles. The video can be found at www.vrca.bc.ca/videos.

Safety is paramount. Pre-start checks are conducted every time the 65-tonne gangways are moved

UBC’s new Pharmaceutical Sciences Building claims six awards For Nick Maile, the only thing better than having a building he helped plan and develop win a series of major architecture awards, it’s seeing the people who use the building truly enjoying it. The development manager for UBC Properties Trust believes the university’s new Pharmaceutical Sciences Building is “architecturally pleasing, but any building, no matter how beautiful, if it doesn’t work for the students and faculty, it’s not a success. This one, though, is incredibly lively – people like to be in it and they use every space.” “At UBC, we are trying to be on the leading edge of sustainability and energy efficiency,” says Nick, “but it’s definitely a challenge with a building like this, where there is a data centre in the basement plus a lot of a lot of laboratories and many fume hoods.” (Fume hoods limit exposure to hazardous chemicals or toxic fumes, but they are energy-guzzlers: one fume hood alone can use more energy than three typical B.C. homes.) For help, UBC turned to BC Hydro’s New Construction Program, which provides funding for an energy-modeling study – a simulation of how a building might function throughout a full year if it’s designed and built with a variety of energy saving measures – along with additional financial incentives for implementing those measures. The energy-saving measures include capturing waste heat from the data centre and recycling it into the building, as well as daylight sensors and a low temperature water system. Together, these measures are estimated to add up to about 1.2 million kilowatt hours of savings every year over a similar building that does not include them. In addition, says Nick, “The incentive from BC Hydro for installing these measures really does help. It may be a small percentage of the overall construction budget, but we can give that money back to the Pharmacy people to use for long-term operations. So not only does the university win by saving on energy use, the department wins as well.”

Looking for new ways to build better? Visit bchydro.com/construction or call 1 866 522 4713 to learn more.

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October 11–17, 2016

special news feature | Vancouver regional construction Association

B6 news

Bullying in construction

EDUCATION: Back to school has never been so important How the construction industry is engaging school leavers

It’s not part of the job

The Learning Profile for Construction Jobs project identified skills that students should acquire prior to beginning a construction apprenticeship | Rokas Tenys/Shutterstock BY Peter DeVries

Bullying and harassment can take many forms. Know what to look for. • Verbal aggression or insults • Harmful hazing or initiation practices • Vandalizing personal belongings • Spreading malicious rumours Help prevent workplace bullying and harassment. Find resources and view our video series at worksafebc.com/preventbullying.

t is no secret that the industry has been wondering for some time how to respond to its ageing workforce. The senior guard have begun hammering the joists on their retirement homes in ever-growing numbers, and they are leaving contractors, builders and trades companies facing a looming personnel gap that young workers just aren’t flocking to fill. “There’s certainly a demand for skilled labour,” said Abigail Fulton, executive director of the Construction Foundation of BC. “There’s a lot of retirement coming up in the trades, so the likelihood of there being skills shortages in the future is high.” According to BuildForce Canada’s 2016-25 Construction and Maintenance Looking Forward report, the anticipated construction industry expansion in B.C. and forecasted retirements will create an estimated 32,000 construction vacancies over the next 10 years. Key to meeting the estimated 10-year demand will be to secure both workers drawn from outside the province and a solid contingent of first-time entrants into the industry. But the first-timers seem to be presenting a bit of a problem. Niko De Marre, project manager at Graham Construction, believes the industry is pigeonholed by a common misperception, particularly among youth. “A lot of people think if you’re in construction, you’re swinging a hammer and that’s about it,” he said. “But that’s a very small cross-section of what we do.” Nonetheless, the result is that few high school graduates are looking to the industry as a career choice. In fact, said De Marre, the industry is widely varied, technologically complex and unyielding to change. “A lot of people don’t realize that there are a lot of different careers in construction,”

Further education in the trades happens after you get your first job

Abigail Fulton Executive director, Construction Foundation of BC

he said. Administration, law, logistics, training and education, engineering, science and technology are just a few. Both the general population and students need to understand the opportunities offered by the industry. Doing so is critical to drawing in young workers, said De Marre. He and many others have been doing just that. De Marre, Ronan Deane, senior project manager at Graham Construction, and various experts from the private and public sectors and associations across the province, including the Vancouver Regional Construction Association (VRCA) and BC Construction Association, have helped develop two key documents for the B.C. government. “One is a report based on input gathered from the industry and teachers on what the education system should focus on in order to get students interested in a career in construction,” said Deane. “The other is a learning profile to help students prepare for a career in the construction sector.” Both Deane and De Marre believe strongly that getting to students early is crucial, echoing one of the key thrusts of VRCA’s education committee that was established many years ago. Getting in front of students and helping them to understand the career opportunities in the industry is

essential. “We want to bridge the gap between knowledge and experience among students,” said De Marre. On one side of that gap stand students already well equipped with a high level of technological comfort; on the other, the construction sector, chomping at the bit to hire young apprentices and fresh talent, but needing to be sure students have the knowledge and experience required for the job. In construction, career development also operates in reverse compared with many other industries. “Further education in the trades happens after you get your first job,” said Fulton. Usually, students go to school and then get a job. In construction, where education takes place on the job, it works the other way around. “You’ve got to get that first job and prove yourself so that an employer will sponsor you through the apprenticeship program,” said Fulton. “So you’ve got to be ready for that first job when you graduate.” VRCA’s education committee seeks to deliver these types of messages to students while also showing them the industry’s lesser-known career paths, what the jobs are really like and which skills are required to do them. “Our vision is that our everevolving presentation, delivered by a large cross-section of the VRCA membership beyond the education committee, becomes a permanent fixture in the secondary school career counselling calendar,” said Deane. To that end, the committee has successfully begun working with New Westminster and is in conversation with the Richmond school board to present career advice. As the committee progresses, its hopes are that its efforts will encourage students to pick up a trade and engage in a construction career. •

s p e c i a l n e w s f e a t u r e | V a n c o u v e r r e g i o n a l c o n s t r u c t i o n A s s o c i a t i o n O c t o b e r 1 1 – 1 7 , 2 0 1 6

Provincial View

When’s the last time you left $1 million on the table? by Manley McLachlan

I At a time when we’re working hard to bring youth into the trades and support them through apprenticeship training, this is an opportunity too good to ignore

Manley McLachlan President, BC Construction Association

f you’re a construction employer with apprentices on staff and you haven’t taken advantage of the LNG Canada Trades Training Fund yet, I have only one question for you: Why not? T he British Columbia Construction Association is doing some important work with LNG Canada, which established this private $1 million fund as part of its construction workforce program. Open to applications since October 2015, it has already paid for the training of hundreds of apprentices from across B.C. At a time when we’re working hard to bring youth into the trades and support them through apprenticeship training, this is an opportunity too good to ignore. Here’s what you need to know: •Apprenticeship training is the priority. •All construction trades are eligible. •All construction employers are eligible to apply on behalf of their employees. •Priority is given to employers with one to 50 employees •All areas of the province are eligible. •Employers may apply on behalf of multiple employees. •There are no out-of-pocket ex penses for employers or employees. •W hen an application is accepted, the funding is paid directly to the training provider in advance of the course start date

Special rates offered to VRCA members To book space or for answers to your questions, please call 604.688.2398 or email ads@biv.com

•This is a private fund and turn-

around is quick. •Unlike publicly funded programs, there are no eligibility restrictions in regard to education level or demographics. LNG Canada recognizes that if British Columbians are going to be ready to take part in the skilled trades opportunities opening up over the next decade, they need to start their training now. LNG Canada also recognizes that the employers who sponsor apprentices today will play a big role in

training those skilled journeypersons that the LNG sector will need in the future. The trades training fund has been established to: 1) Support small to medium enterprises that employ, sponsor and train apprentices in the construction and related trades. 2) Support and increase apprent icesh ip t ra i n i ng a nd completions. 3) I ncre a se t he nu mb er of skilled British Columbian journeypersons available to work in

the trades. The fund is held by the Construction Foundation of British Columbia and administered by the BC Construction Association. It’s a generous fund but at some point the dollars will run out. Check it out today at www. bccassn.com/lngcanada. • Manley McLachlan is president and chief executive officer of the BC Construction Association, the province’s voice of the construction industry supported by four regional associations throughout B.C.

October 11–17, 2016

special news feature | Vancouver regional construction Association

Constructive comment

Small business is the engine that drives our economy This October marks the 10th anniversary of Small Business Month in B.C.

BY Fiona Famulak

ompanies with fewer than 50 employees ma ke up 98% of businesses in B.C. They also account for more than half of private-sector jobs in the province – 56% – according to British Columbia’s Small Business Roundtable. It therefore makes sense that the majority of the membership of the Vancouver Regional Construction Association (VRCA) is represented by small businesses – 67% to be exact. They are general and trade contractors, as well as manufacturers, suppliers and allied services providers, such as insurance compa n ies, law yers a nd accountants, all of whom serve the

multibillion-dollar industrial, commercial and institutional (ICI) construction industry. This October marks the 10th anniversary of Small Business Month in B.C., an opportunity to recognize and celebrate the hundreds of men and women who own and operate small businesses in every industry, create jobs and allow families and communities to thrive.

Companies with fewer than

Small business in the construction industry There are a number of unique opportunities that come with being a small and nimble business. Specifically, in construct ion, bei ng sm a l l ca n mea n greater specialization in services offered and the flexibility to more quickly adapt to trends and to adopt new technologies. Also, it’s often easier to build a strong company culture when you’re smaller, which is key for employee retention and acquisition alike. Running a small business and seizing these opportunities, however, is not for the faint of heart. Our industry is competitive, and the bar is always being raised. Companies are expected to be better, and for a

majority of the membership

entrepreneurial spirit, financial investment and hard work. And, done right, it’s incredibly rewarding.

50 employees make up 98% of businesses in B.C. They also account for more than half of private-sector jobs in the province – 56% – according to British Columbia’s Small Business Roundtable. It therefore makes sense that the of the Vancouver Regional Construction Association is represented by small businesses – 67% to be exact

small business, the challenge is not only to innovate, but to do so with fewer staff and resources. And it’s not a 9-to-5 endeavour. This is especially true when a business is focused on building a corporate profile, a customer base and the capacity to deliver. That takes vision, an

How VRCA supports small business in the construction industry VRCA is a one-stop shop for small-business needs in the ICI construction industry. Many of our members don’t have the time or capacity to market themselves, chase down project opportunities, access recruitment programs or research industry training options. So we do the heavy lifting. We develop prog ra m s a nd services that help our members make and save money and offer access to those offerings at affordable rates. If you’re skeptical about membership, I challenge you to tally up the time and cost it takes to complete the above tasks on your own. The result may surprise you. However, VRCA does not work alone. We have an incredible network of industry partners that help us support the continued success of our smallbusiness base, partners such as the Canadian and B.C. construction associations, the electrical,

mechanical and roofing contractors associations of B.C., and the BC Construction Safety Alliance. The provincial government, various chambers of commerce, the Women’s Enterprise Centre and many non-industry organizations also help us to support sma l l busi nesses across the Lower Mainland. In summary If small business is the backbone of our economy, then rest assured VRCA and its partners have your back. Let’s take the opportunity this month to celebrate the big thinkers, hard workers and strategic risk-takers that are the engine of our economy. Thank you to all of you. • Fiona Famulak is president of the Vancouver Re gional Cons truc tion Association (VRCA). With close to 700 members, VRCA is British Columbia’s largest and most inclusive regional construction association, representing union and non-union, general and trade contractors, manufacturers, suppliers and professionals who ser vice the industrial, commercial and institutional construction industry throughout the Lower Mainland.

ReCogNiziNg BC’S Top ExporTErs FiNaliStS aNNouNCed! The BC Export Awards recognize the innovative approaches and unique contributions of British Columbia export companies across all sectors and in all regions of the province, as well as the individuals who contribute to their success. Join us November 18th to celebrate the best and the brightest in British Columbia’s export industry. Hyatt Regency Vancouver Hotel (655 Burrard Street, Vancouver, BC) | 10:30am - 2:30pm Subscribers $115 | Non-subscribers $145 | Corporate tables $1,750 Visit www.canadaexportawards.com for more info and to see the list of 2016 finalists. p R e S eN t i N g pa R t N eR S:

p R em i eR S p o N S o R S:

g o l d S p o N S o R S:

S i lV eR S p o N S o R S:

g eN eR a l S p o N S o R S:

GO2PRODUCTIONS make it great

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news

BUSINESS: Succession for construction companies Five steps to a successful succession BY Kelly Taylor, CPA, CA, CGA

ntrepreneurs invest huge amounts of time, money and patience in building a successful business and not only want to see their legacy continue, but also want to be able to exit on their own terms. As a company grows, you need different skills and different personnel to provide them, and likely a more sophisticated governance structure. But filing these needs requires long-term planning that aligns with the business’ strategic plans. Robert Lashin has been planning for succession for the past 37 years. He was one of a dozen employees who bought Houle Electric in 1979 when the original owner, Lionel Houle, wanted to retire but couldn’t find a buyer. Lashin knows all about succession – and implementing it. A recent poll by Hays Canada indicates half of construction business owners don’t have a succession plan. And of those, only 28% plan to launch one in the next year. “That’s a step toward extinction,” said Lashin, president of Houle Electric since 1997. “If you look at all companies,

great companies will not necessarily stay great companies. The sustainability of every company is its lifeblood; thinking about succession and how things will continue to grow is essential to a company’s sustainability.” “Planning for the proper lead time will allow you to choose a transition strategy and identify and groom potential successors,” said Doug Tyce, CPA, CA, business adviser and B.C. leader, real estate and construction services, with accounting firm MNP. “This is especially important if you’re transitioning to a family member or have a key employee or employee group already involved in the business that requires an internal transition rather than an external sale.” Lashin and his partners made succession an integral part of their business plan, not just for their retirement but to support people’s growth into leadership positions and to ensure the sustainability of the company. But it hasn’t always been easy. Once on the table, the biggest challenge in executing a succession plan is getting the initial buy-in, then ongoing commitment, from employees.

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2016-10-06

“Strategic planning is about cha nge, a nd people resist change,” Lashin noted. “Proper strategic development is hard work; it’s very difficult to do. And of course, it’s also a long-term process and people don’t see the immediate benefit. “It takes real discipline and real communication with your employees to understand the importance of strategic planning for the long-term health of the company. So, you require the proper change management strategy in your company to continue. Hiring a good consultant to help with that process is imperative.” Tyce added, “One of the key elements of a successful exit strategy is to ensure the corporate structure allows the owner to exit the business in the most taxefficient manner. If the structure does not align properly, it will either inhibit the intended exit strategy or result in excessive income taxes.” For example, the decision to sell the business to a third party could affect your immediate and future tax liability, and should be addressed when creating a plan. Also, capital gains exemptions may not be available for

successful mature businesses unless appropriate tax-planning steps, potentially involving a holding company and a family trust, are started well in advance. A nother common tax plan is implementing an estate freeze to reduce the tax liability of a growing business for the main shareholder(s). This usually entails creating a family trust to shift future value on the common shares to other family members. Five steps to a successful succession •Sooner is better. Transition planning should be done over a four- or five-year period to ensure the most successful outcome – and the earlier, the better. Consider this: demographic changes will push an increasing number of businesses onto the market in the coming years – all competing with yours. •Commit to implement. Make sure you recognize the importance of strategic planning, and, once you recognize it, ensure you allow the time and resources to follow through with it. Allocate the time and resources to the process and implement it, don’t just shelve it.

•Know what you want, know what you’ll get. The value of a business is based not on what you think it is worth, but on what the market will pay. If you need a certain amount of cash out of the business, you’ll need to get at least a rough valuation as soon as possible. •The taxman cometh. Without effective tax and estate planning, you run the risk of ending up with less than you anticipated. Working with a tax specialist, you’ll be able to ensure your tax structure allows maximum flexibility for estate planning, income splitting and capital gains consideration. •Develop a road map. By making your succession plan an integral part of your overall business plan, you’ll have something that is built and managed in a way that facilitates a change in management or ownership without major disruption. • Kelly Taylor, CPA, CA, CGA, is a business adviser, real estate and construction services, at MNP LLP, a leading national accounting, tax and business consulting firm in C anada. MNP provides a collaborative, cost-effective approach to doing business and personalized strategies to help organizations succeed across the country and around the world.

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THERE IS A GOOD REASON WHY CLIENTS KEEP COMING BACK to Wales McLelland! Call us to find out on your next project.

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October 11–17, 2016

special news feature | Vancouver regional construction Association

B10 news REDUCE, REUSE, RECYCLE: Be more green to make more green Why and how to set up job-site waste reduction and recycling programs

artem rakhno/Shutterstock

By Karen Storry, P.Eng.

reen constr uction is ta k i ng of f i n Ca n ad a . Certain contractors are already achieving job-site diversion goals of up to 95% toward Leadership in Energy and Environmental Design (LEED) and other green certifications, creating strong competition, saving money and helping the environment. Local construction companies report saving $20 to $100 per bin through recycling programs. According to the Canadian Green Building Council, the market share for non-residential green building projects has grown from 20% to 30% in 2011 to 40% to 50% in 2016, with much of that green construction happening right here in the Lower Mainland. Implementing job-site reuse and recycling programs can help businesses grab a share of the ever-increasing green building market. Once the recycling and reuse mindset is ingrained, it can catalyze many more opportunities to reduce waste on building sites, leading to more cost savings. Step 1: Set a goal and make a plan The first step is to figure out what materials you’ll be dealing with and where they need to go. Create a detailed inventory of leftover job-site materials as well as the recycling facilities that will accept them. While every building is different, you will likely be targeting four primary material categories: concrete and asphalt, clean wood, metals and cardboard. Industry experts provide the following tips for making sure

Key stakeholder Waste haulers

What to communicate Ask what is and isn’t accepted in each bin. Ask for copies of receipts to verify the material was received at a licensed facility or equivalent.

Local recyclers

Create a list of preferred recyclers who meet your corporate and ethical goals, and can recycle all of your waste.

Site supervisors and personnel

Install clear signage with Yes and No lists. Include recycling information in site orientations and toolbox talks. Have a competition between sites for who can recycle the most. Make it easier to place materials in the correct bins by setting designated material collection spots close to work sites.

your programs are successful. Tip 1: Make recycling on the job sites part of your company’s culture. Start by setting an initial corporate goal of 50% to 70% diversion, and go from there. Tip 2: Save space by combining certain mixed materials or having smaller bins. Many recyclers will also accept same-day collections. Tip 3: Decrease recycling costs by setting up one bin per material in order to get the highest recycling rate. Tip 4: Separate food waste to reduce contamination. An organics bin will do the trick. Tip 5: Avoid gypsum surprises. Familiarize yourself with the local recycling rules and facilities to make sure the product you collect will be accepted. Tip 6: Look up recycling options for all sorts of materials at www. metrovancouverrecycles.org. Step 2: Communicate the plan Explain your goals and intentions to your waste haulers, recycling service providers, site supervisors, workers and all other site personnel. Make sure

all parties have bought in and are aware of the benefits of waste reduction. Step 3: Reduce waste to save even more money Once your operation has established a recycling program and your team has developed recycling habits, you will likely start noticing many more opportunities to reduce waste generation in the first place. There are many simple modifications to standard procedures that can cut down waste. These changes will make work more efficient and will ultimately save you time and money. Wood waste can be reduced significantly through project planning. Here are some examples: •Consider reusable metal formwork instead of wooden gang forms. •Use off-site panelizing companies to prefab your wall frames. •Order wood for subcontractors based on a site takeoff to avoid over-ordering and to make sure that the length of the wood order aligns with the height of the frames.

Reclaimed lumber: before and after | Becky

Starsmore/Natsutapon/

Shutterstock

•Use centralized cutting sites to optimize use of offcuts. Here are more ideas for other materials: •Stockpiled concrete and asphalt can be used on-site for road base or fill. •Create a return-to-warehouse program for common job-site items, such as signs. •Have site superintendents or foremen tag materials suitable for reuse. That way all site personnel can easily identify what material to put in the recycling bin and what material to load back on the truck for the next job. •Sell leftover materials to used building material stores. •Encourage clients to restore

the existing building instead of tearing it down and building a new one. On-site recycling will help better position your company with clients requiring green certifications such as LEED, will save you $10 to $200 per bin and will help the environment by reducing waste and associated greenhouse gas emissions. • Karen Storry, P.Eng., is a senior project engineer with Metro Vancouver, which is a partnership of 21 municipalities, one electoral area and one treaty First Nation that collaboratively plans for and delivers regional-scale services including drinking water, waste-water treatment and solid waste management.

s p e c i a l n e w s f e a t u r e | V a n c o u v e r r e g i o n a l c o n s t r u c t i o n A s s o c i a t i o n O c t o b e r 1 1 – 1 7 , 2 0 1 6

B11

Legal specs

The builders lien trust and bankruptcy BY Norm Streu and Christopher Hirst

he Builders Lien Act provides a number of powerful remedies to ensure payment on construction projects. One of these remedies is the statutory trust. The trust remedy provides that payments received on a construction project are legally held in trust for subcontractors down the contractual chain. While it is a powerful remedy, non-payment on construction projects often involves bankruptcies. What happens to the Lien Act trust funds in the event of a bankruptcy? Does the trust survive bankruptcy, or do those trust funds simply form part of the bankrupt’s estate in accordance with the Bankruptcy and Insolvency Act and become subject to the cla i ms of a l l the ba n krupt’s creditors – not just the unpaid subcontractors? This is an issue because, constitutionally, bankruptcy is a matter of exclusive federal jurisdiction and pursuant to a doctrine referred to as paramountcy. Provincial legislation such as lien legislation that conflicts with federal bankruptcy law is rendered inoperative to the extent of the conflict. A recent case example of this

intersection of lien legislation and bankruptcy law is the decision of the BC Supreme Court regarding 0409725 B.C. Ltd. (the Odenza Homes bankruptcy). At the time of Odenza’s bankruptcy, some 17 home-building projects and a number of renovation projects in and around Vancouver were underway. Left in the lurch at the time of the bankruptcy were both the owners of the projects under construction and all of the unpaid suppliers and subcontractors. As of the date of the bankr uptcy, Oden za’s operat i ng ba n k accou nts conta i ned i n total $527,506.22, which funds represented the only asset of the estate. Lien and trust claims from the subcontractors alone totalled nearly $3 million. Accordingly, if the Builders Lien Act trust claims survived the bankruptcy there would be nothing left for the other creditors of Odenza including various homeowners who had paid to Odenza the entirety of the money remaining to Odenza at the time of the bankruptcy. The court ultimately held that the doctrine of paramountcy was not at play because the Builders Lien Act was not an attempt by the provincial legislature to reorder the priorities established in the Bankruptcy and Insolvency Act. In addition, the court found that the trust created by

the Builders Lien Act would be considered a trust at common law and was therefore an exempt trust for the purposes of the Bankruptcy and Insolvency Act. In making this determination, the court analyzed whether the trust created by the Builders Lien Act met the common-law requirements of a trust: certainty of intention, certainty of subject matter and certainty of objects. The court found that certainty of intention was sufficiently provided by the Builders Lien Act itself. With respect to certainty of objects, that was also found to exist as the intended beneficiaries of the trust (the subcontractors) were easy to ascertain. The more complicated issue was whether certainty of subject matter existed due to Odenza’s intermingling of funds from different projects. Odenza had many different projects and had been paying money received from one owner to the credit of subcontractors on different projects and the money remaining in its accounts represented funds from numerous projects. In so doing, Odenza had committed various breaches of trust itself but, since the funds had been intermingled and could no longer be specifically earmarked for each project to which they belonged, the argument was made that there was

insufficient certainty of subject matter for the funds to constitute a trust at common law. The court concluded to the contrary, however, reasoning that the trusts created by the Builders Lien Act could not and should not be gutted by Odenza’s own breaches of trust in the handling of the funds. Therefore the court found that all of the money in the hands of the trustee in bankruptcy was money received on account of the price of the contract and thus constituted trust funds under the Builders Lien Act. It was not available for general distribution to the creditors. In light of this decision, it would appear that the trust remedies of the Builders Lien Act will survive bankruptcy where those trust funds meet the three criteria of a common-law trust. In such cases, lien trust funds will not be available for distribution to the general creditors of the bankrupt. To answer the question posed at the beginning of this article, this powerful remedy in the Builders Lien Act trust can survive a bankruptcy. • Norm Streu is president and chief operating officer of the LMS Reinforcing Steel Group. Christopher Hirst is a partner and leader of the Construction & Engineering Group, Alexander Holburn Beaudin + Lang LLP.

digital privacy & security

October 19, 2016 4:00pm – 6:00pm

Panellists:

Moderator:

Is your business protected from cyber crime? The Ashley Madison scandal, in which hackers stole and made public the names, emails, home addresses and private fantasies of millions of subscribers to the Canada-based dating website, has dramatically underlined the importance of data security – and the potentially disastrous consequences of data breaches. As the gathering, storage and analysis of data becomes an increasingly important tool for companies to gain a competitive edge and maintain daily operations, businesses with inadequate digital security are becoming increasingly at risk of data theft. The BES digital privacy and security discussion will tackle some of the most pressing information technology challenges facing businesses of all sizes today.

Greg Vanier Vice President Crisis & Risk, Edelman Canada

Joel Abramsom CEO, Fully Managed

Danny Timmins National Leader, Cyber Security Services, MNP LLP

Kirk LaPointe VP, Audience & Business Development, Business in Vancouver

preSented by: