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CONSTRUCTION ECONOMIST
The Journal of the Canadian Institute of Quantity Surveyors Le Journal de l’Institut canadien des économistes en construction
SPRING 2022
HOUSING AFFORDABILITY
Nationwide Crisis
PM 40065075
CONGRESS OTTAWA, JUNE 16-18, 2022
ciqs.org
Canada’s Leading Journal in Construction Economics
The mission of CIQS is to promote and advance professional quantity surveying and construction estimating; to establish and maintain national standards; to recruit, educate and support our members.
Canadian Institute of Quantity Surveyors 90 Nolan Court, Unit 19, Markham, ON L3R 4L9 t. 905/477.0008 f. 905/477.6774 toll free. +1 866/345.1168 e.info@ciqs.org www.ciqs.org Chief Executive Officer Sheila Lennon, CAE
ceo@ciqs.org
Managing Editor Arif Ghaffur, PQS(F)
aghaffur@ciqs.org
Editor Chris Court, PQS(F)
editor@ciqs.org
Assistants to Editor Ajibola Soboyejo, PQS Shane McKernan, PQS Send Change of Address to: Canadian Institute of Quantity Surveyors 90 Nolan Court, Unit 19, Markham, Ontario L3R 4L9
CIQS Board Chair: Erin Brownlow, PQS Vice-Chair: Arif Ghaffur, PQS(F) Past Chair: David Dooks, PQS(F)
CONSTRUCTION ECONOMIST SPRING 2022
The Journal of the Canadian Institute of Quantity Surveyors Le Journal de l’Institut canadien des économistes en construction
Features CIQS Congress 2022 coming to Ottawa, live and in person . . . . . . . . . . . . . . . . 18 Decarbonization – Buildings and Canada’s journey to net zero . . . . . . . . . . . . . . . . . . . . . 20 Alliance contracting – A collaborative project delivery model. . . . . . . . . . . . . . . . . . . . . . . . . 22 In memoriam – Ian Duncan, PQS(F). . . . . . . . . . . . . . . 25 Vaccine and pandemic mandates take centre stage as the CIQS begins to ramp up advocacy for 2022. . . . 29
Education Director: Adam Ding, PQS
Dedicated to the memory of
Director: Tammy Stockley, PQS Director: Hiran Dassoruth, PQS
Ian Duncan, PQS(F)
Director: Jack Chen, PQS Director: Antoine Aurelis, PQS Director: Dominic Leadsom, PQS
1950-2021
Advisor: Roy Lewis, PQS(F) Statements of fact and opinion contained within this journal are those of the authors, including subject matter experts. CIQS assumes no responsibility or liability for the content of such fact and opinion, nor do they represent the official policy of CIQS. Published four times a year on behalf of the Canadian Institute of Quantity Surveyors by
25
Corners
Messages
5 Education Corner. . . . . . . . . . . . . 13 Legal Corner. . . . . . . . . . . . . . . . 14 Prompt Payment. . . . . . . . . . . . . 17
Chair’s Message . . . . . . . . . . . . . . .
Congratulations Corner… . . . . . . . . .
4 CEO’s Message. . . . . . . . . . . . . . . . 8 Editor’s Message. . . . . . . . . . . . . 11
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OUR CONCERN FOR THE ENVIRONMENT IS MORE THAN JUST TALK This document is printed on paper certified to the standards of the Forest Stewardship Council® (FSC®).
Spring 2022 | www.ciqs.org | CONSTRUCTION ECONOMIST | 3
Chair’s Message
International Women’s Day
M
arch 8, 2022 was International Women’s Day. This is a day that is set aside to recognize and appreciate achievements by women internationally; a day where we continue the work to achieve gender parity and break the gender bias. The dream is to live in a world free of gender bias, stereotypes, and discrimination. A world that is inclusive of all walks of life, valuing, celebrating and embracing differences. At the CIQS, we have strong women in leadership. These women know their industry extremely well and are very results-motivated and passionate about what they do. Here are some of our women leaders I would like to acknowledge. Sheila Lennon, CEO of the CIQS, is beyond dedicated and focused. There are days I am not sure where her drive comes from, and as a leader of the CIQS, she is doing a fantastic job. In the few years she has been with us, she has brought the CIQS to the next level. It is important that we recognize her for her accomplishments and passion. Personally, I want to thank Sheila for everything she has done to support the Institute and to lead her team. In addition, I want to thank her team, which is also made up of strong women leaders. Tammy Stockley, a Director of the CIQS and Chair of the External Relations Committee, has gone above and beyond to put the CIQS in front of many public and association stakeholders working tirelessly to ensure we have a professional presence at many tables. Tammy, I want to thank you as well for the impressive portfolio you lead for the Institute and that your dedication
Erin Brownlow, PQS
At the CIQS, we have strong women in leadership. These women know their industry extremely well and are very results-motivated and passionate about what they do. to this work has opened doors and created opportunities the CIQS has not experienced before. Your passion in your work as a professional quantity surveyor is what drives you, and I think that is awesome. As Chair of the Board of the CIQS, I also fit into this category. I am a strong female leader; I love chairing the meetings and guiding important conversations. There are days I am completely drained and unmotivated, yet when I click the link for our meetings, I feel this sudden burst of energy seeing everyone there. Finding the balance can be hard and there are days I need to dig really deep to find the motivation. I started working in construction in 1997, however, if you count the family landscaping business, then I suppose I started when I was a small girl tagging along with my dad to job sites. Ice cream was payment back then, so perhaps that doesn’t count. I have had and continue to have many experiences which I am certain my other female colleagues have. Comments and actions easily seen as demeaning and offensive remarks, which are entirely inappropriate in our industry; the countless times women are asked if they are having kids and will continue to work after that; not giving promotions or jobs to women because they may need to
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take time for babies or marriage; going to meetings and noticing people checking their phones more often when women speak; how the conversation changes from banter to stiff when a woman’s face appears; assuming the woman is not the professional or the leader and ignoring her presence or asking that she take the minutes because she must be the assistant. Condescending comments, the constant questioning of qualifications and discounting expertise, in many cases are done indirectly and not directly to women – instead, discussed with other male counterparts or supervisors. It is now 2022. There are days I remind myself how it was when I started, and how much better it is now. There are days I remind myself how much my experiences have hardened me and helped me grow. Then there are most days when I would rather have just worked in this industry and been recognized for my skills and talent rather than have my abilities questioned simply because of my gender. After 25 years in this industry, it is amazing the leaps and bounds which have occurred, but equally amazing that we still share the same stories we had 25 years ago because they just happened yesterday. The last and only other time a woman held the position of Chair/President of the CIQs was in 1990 to 1991. A reminder
Chair’s Message
that the CIQS was originally established in 1959, so in 63 years, there have been only two women in this role. Thank you Linn Marron-Marshall for opening this door for us so long ago. Additionally, Lois Metcalfe supported the CIQS for many years and dedicated most of her life to the Institute – she was the lifeline of the CIQS. There are many strong and dedicated women within the CIQS, I have only named a few but encounter them often. I hope you all take time on International Women’s Day to recognize the women in your circle.
The increase in the number of women impresses me however the differential treatment will keep the numbers low. There is still a lot of work to do. Make a conscious effort and pay attention more closely. Take notice when women are being interrupted, and make a point to ensure they get their opportunity in meetings to speak. Share how smart they are and their accomplishments. To my fellow women leaders: be seen and heard. If you should be in a meeting, include yourself. If you are the person with the expertise, say you are
that person. If you don’t see another woman on that call, turn on your camera so your presence is known. To all my fellow leaders and future leaders regardless of gender identity – know and acknowledge your unconscious biases. We all have them. Knowledge is power. Use it. Stay safe, healthy, respectful, and happy. Erin Brownlow, Professional Quantity Surveyor Chair, CIQS
Congratulations Corner
Congratulations to the following ‘Designation Holders’ who have qualified as a PQS or CEC (Including reinstatements): CIQS – British Columbia Aleicia Sharp, CEC Anton Kakatunov, PQS Brenda Estoque, CEC Ehsan Tayefah, CEC Hamilton Tan, CEC Jade Bruni, PQS John Peter Buckley, PQS Kenneth David Easley, PQS Tavis Chow, PQS CIQS – Maritimes Abu Bakar Siddiq Joni, CEC Carlos F. Lavin, PQS Chris Skinner, CEC Karim Farghal, CEC CIQS – Members at Large Baris Eken, PQS Bhagya Sanjaya Weerasena, PQS Cheung Sin Man, PQS Hendrik Johannes Louw, PQS James David Jatau, PQS Jithesh Kandiruthy Pushkaran, PQS Malawanna Dewage Kethmi Nathasha Jayaweera, CEC Mohamed Abdul Cader Fayaz, PQS
CIQS – Ontario Abdul Waheed, PQS Adam Casey, PQS Alireza Shahrokhi, CEC Anushka Chathurangi Hapuarachchige, CEC Arash Nezafati, CEC Ariadne Marques de Mendonca, CEC Benjamin Patrick Fosey, PQS Bohdan Nebeluk, PQS Bonheavon Bacus, CEC Cormac McDaid, PQS Douglas J. River Zabala, CEC Haidar Subhi Al-Maroof, CEC Hany Hassan Aly, CEC James Dewan, CEC Kenneth Kwong, CEC Mackenzie Cook, CEC Mahdi Sayed Alavi, CEC Mahmoud Pirzadeh, PQS Maridel Lemon, CEC Nicholas Harrison Guerten, PQS Olena Akther, PQS Robyn Player, PQS Salvatore Salemi, CEC
Shivam Mehta, CEC Steven Paul Overton, PQS Su Cheng Chong, PQS CIQS – Prairies and NWT Abraham Ruedas, PQS Aileen Lim Cu, PQS Allen S. Reid, PQS Birhen Malapad, CEC Bryan S. Leahing, PQS Ehsan Arbab, CEC Ermias Atnafu Belachewu, CEC Etienne Pierre Nel, CEC Jon Macdonald, PQS Ibrahim Oladapo, PQS Isidro Llovia, CEC Linus (Ukkyu) Choi, CEC Sheryl Alcazar Surla-Benavente, CEC Tenika Dinesen, PQS CIQS – Quebec Delphine Haudenschild, CEC Maher Fares, CEC
Spring 2022 | www.ciqs.org | CONSTRUCTION ECONOMIST | 5
Message du Président du Conseil
Journée internationale de la femme
L
e 8 mars est la Journée internationale de la femme. Cette journée est consacrée à la reconnaissance et à l’appréciation des réalisations des femmes à l’échelle internationale, à la poursuite des efforts visant à atteindre la parité entre les sexes et à briser les préjugés sexistes. Nous rêvons de vivre dans un monde exempt de préjugés, de stéréotypes et de discriminations liés au genre. Un monde ouvert à tous les horizons, qui valorise, fête et accepte les différences. La direction de l’ICÉC comprend des femmes fortes. Ces femmes connaissent extrêmement bien leur secteur, sont très motivées par les résultats et sont passionnées par leur travail. Voici quelques-unes des femmes au sein de notre direction que je voudrais saluer. Sheila Lennon, directrice générale de l’ICÉC, dont la concentration et le dévouement sont hors pair. Il y a des jours où je ne sais pas trop d’où vient son dynamisme, et en tant que dirigeante de l’ICÉC, elle fait un travail fantastique. Au cours des quelques années qu’elle a passées avec nous, elle a fait passer l’ICÉC au niveau supérieur. Il est important que nous reconnaissions ses réalisations sa passion. Personnellement, je tiens à remercier Sheila pour tout ce qu’elle a fait pour soutenir l’Institut et diriger son équipe. En outre, je tiens à remercier son équipe de direction qui est également composée de femmes fortes. Tammy Stockley, administratrice de l’ICÉC et présidente du comité des relations extérieures, s’est surpassée pour mettre l’ICÉC en avant auprès de nombreux intervenants publics et associatifs, travaillant sans relâche pour nous assurer une présence
professionnelle à de nombreuses tables. Tammy, je tiens également à vous remercier pour l’impressionnant portefeuille que vous dirigez pour l’Institut et pour le fait que votre dévouement à ce travail a ouvert des portes et créé des opportunités auxquelles l’ICÉC ne pouvait pas accéder jusqu’ici. Votre passion pour votre travail en tant qu’économiste en construction agréé est ce qui vous motive, ce que je trouve génial. En tant que présidente du conseil d’administration de l’ICÉC, j’entre également dans cette catégorie. Je suis une femme forte dans un poste de direction; j’aime présider aux réunions et orienter les conversations importantes. Il y a des jours où je suis complètement épuisée et démotivée, mais lorsque je clique sur le lien de nos réunions, je ressens cette soudaine explosion d’énergie en voyant tout le monde présent. Ce n’est pas toujours évident de trouver le bon équilibre, et il y a des jours où je dois creuser très profondément pour trouver la motivation. J’ai commencé à travailler dans la construction en 1997, mais si l’on compte l’entreprise familiale d’aménagement paysager, je suppose que j’ai commencé lorsque j’étais une petite fille qui accompagnait mon père sur les chantiers. On me payait en crème glacée à l’époque, alors peut-être que ça ne compte pas. J’ai vécu et je continue de vivre de nombreuses expériences, comme mes autres collègues féminines, j’en suis certaine. Certains commentaires et actions sont faciles à voir, comme les remarques dégradantes et offensantes qui sont tout à fait inappropriées dans
6 | CONSTRUCTION ECONOMIST | www.ciqs.org | Spring 2022
Erin Brownlow, PQS
notre secteur; les innombrables fois où l’on vous demande si vous allez avoir des enfants et si vous allez continuer à travailler par la suite; le fait de ne pas accorder de promotions ou de postes aux femmes parce qu’elles pourraient prendre du temps pour s’occuper de leur bébé ou de leur mariage; le fait d’assister aux réunions et de remarquer que les gens consultent leur téléphone plus souvent lorsque des femmes prennent la parole; la façon dont la conversation passe du badinage à la raideur lorsqu’une femme apparaît; le fait de supposer que la femme n’est pas la professionnelle ou la dirigeante et d’ignorer sa présence ou de lui demander de prendre les notes parce qu’elle doit être l’assistante. Les commentaires condescendants, les remises en question constantes des qualifications et le mépris de l’expertise, dans de nombreux cas, sont faits indirectement et non directement aux femmes, ils font plutôt l’objet de discussions avec d’autres homologues ou superviseurs masculins. Nous sommes maintenant en 2022. Il y a des jours où je me rappelle comment c’était quand j’ai commencé, et combien c’est mieux maintenant. Il y a des jours où je me rappelle à quel point mes expériences m’ont endurcie et m’ont aidée à grandir. Et puis il y a la plupart des jours où je préférerais simplement travailler dans ce secteur et être reconnue pour mes compétences et mon talent plutôt que de voir mes capacités remises en question simplement à cause de mon sexe. Après 25 ans dans ce secteur, il est étonnant de constater les bonds en avant qui ont été faits, mais tout aussi étonnant de constater que nous partageons encore les mêmes histoires qu’il y a 25 ans, parce qu’elles se sont produites hier.
Message du Président du Conseil
La direction de l’ICÉC comprend des femmes fortes. La dernière et unique fois qu’une femme a occupé le poste de présidente de l’ICÉC était de 1990 à 1991. Il convient de rappeler que l’ICÉC a été créé en 1959 et qu’en 63 ans, seules deux femmes ont occupé cette fonction. Merci à Linn Marron-Marshall de nous avoir ouvert cette porte il y a si longtemps. Lois Metcalfe a soutenu l’ICÉC pendant de nombreuses années et a consacré la majeure partie de sa vie à l’Institut; on peut même dire qu’elle lui a sauvé la vie. Il y a beaucoup de femmes fortes et dévouées au sein de l’ICÉC, je n’en ai cité que quelques-unes mais je les rencontre souvent. J’espère que vous prendrez toutes le temps, à l’occasion
de la Journée internationale de la femme, de reconnaître les femmes de votre entourage. L’augmentation du nombre de femmes m’impressionne, mais si elles continuent d’être traitées différemment, les chiffres resteront faibles. Il y a encore beaucoup de travail à faire. Faites un effort conscient et soyez plus attentif. Remarquez quand quelqu’un interrompt une femme, et veillez à ce qu’elles aient l’occasion de s’exprimer lors des réunions. Parlez de leur intelligence et de ce qu’elles ont accompli. À mes camarades femmes dirigeantes, soyez vues et entendues. Si vous devez participer à une réunion, faites en sorte d’y participer. Si vous êtes la personne
la plus compétente, dites que vous êtes cette personne. Si vous ne voyez pas d’autre femme lors de cet appel, allumez votre caméra pour indiquer votre présence. À tous mes collègues et futurs collègues dans des portes de direction, quelle que soit votre identité sexuelle, sachez reconnaître vos préjugés inconscients. Nous en avons tous. Savoir c’est pouvoir. Alors utilisez votre savoir. En vous souhaitant la santé, le respect et le bonheur, Erin Brownlow, économiste en construction agréé Présidente – ICÉC
Cost Consultants, Project Monitors and P3 Advisors Proud Supporters of the CIQS
100 York Blvd., Ste 608, Richmond Hill, ON L4B 1J8 Tel 905.889.9996 www.pelicanwoodcliff.com
Spring 2022 | www.ciqs.org | CONSTRUCTION ECONOMIST | 7
CEO’s Message
Starting 2022 on the right foot
I
am thrilled to announce that 2021 was another blockbuster year for CIQS! We are now 2,085 members, of which 1,104 are Professional Quantity Surveyors and 365 are Construction Estimator Certified. We are also gaining inroads with the quantity surveyors of tomorrow as our student memberships continue to grow. I give credit to our amazing ambassadors who volunteer their time to attend virtual student mixers and present at college lunch & learns across the country to educate the next generation about the exciting opportunities a career as a quantity surveyor avails them. Over the last two years, I have often said that quantity surveyors are in high demand in both bull and bear markets and the continual rise in members during a global pandemic is further proof of that fact. The results of the Q4 Construction Monitor Report survey emphasize the expanding need for qualified quantity surveyors, as indicated by the 60% of survey respondents who reported a shortage of these professionals. This fact made me curious, and after a basic search for “Construction Cost Estimator” on www.indeed.ca, I was presented with a list of 485 jobs from across Canada. The Q4 Construction Monitor Report also showed an expectation of growth in infrastructure as well as private and non-residential projects. This was echoed by reports published this year by both the Canadian Real Estate Association (CREA), local real estate boards, and private real estate agencies. Renovations IN YOUR FUTURE? Inform your insurance company Canada’s residential renovation sector has become an $80-billion market. As reported in a blog entitled “Can housing
upgrades affect insurance?” published in CREA Café,1 27% of Canadian homeowners have renovated their homes during the pandemic, and an additional 20% are thinking of starting renovations soon. According to www.statista.com, the three major renovations are landscaping, bathrooms and kitchens (Figure 1 on page 9). As the CREA blog mentioned, it is always prudent to report major renovations to your insurance company to make sure that any upgrades are covered under the current plan. CIQS’s new affinity partner, Sonnet Insurance, has created a list of ten changes you should share with your insurance company to make sure you are covered during renovations, as well as if the upgrades require an increase in your coverage limits. Some of these changes include: 1. Replacing an old roof. 2. Major renovations such as an addition or extension. You need to make sure you are covered for every stage of the renovation, especially if you are changing the structural integrity of the home. 3. Upgrading and/or updating the home’s exterior envelope. Even if you are not renovating currently, this is the perfect time to learn more about the affinity partnership between CIQS and Sonnet Insurance. Visit the CIQS-specific affinity page from the CIQS member portal at www.ciqs.org for program details and to get a free online quote. You must be a CIQS member in good standing to be eligible for the Sonnet Insurance CIQS discount. Access all member benefits – renew your CIQS membership today The 2022-2023 member renewal invoices were emailed on February 8, 2022, and
8 | CONSTRUCTION ECONOMIST | www.ciqs.org | Spring 2022
Sheila Lennon, CAE
this year we have made it easier than ever to renew via our newly launched member portal. Your membership dues make it possible for the CIQS team to grow the organization on a local, national, and international stage. This past year, despite feeling like we were all living in a modern-day version of the movie “Groundhog Day” with lockdowns coming and going throughout the year, the CIQS team worked tirelessly on your behalf. 2020-2021 CIQS Annual Report available for download In 2021, the CIQS team: • Designed and launched a new, interactive membership management system. • Designed and launched an award-winning website to help promote the quantity surveying profession as well as to better serve our members. • Published a new textbook, Construction Project Management, written by Tulsi Regmi, PhD, PQS and Bill Nichols, MSc, PQS(F), PLE, GSC, FCIOB. • Hosted the Institute’s first three-day virtual Congress. • Expanded our government relations program and held virtual meetings with federal government officials. • Completed most of the tasks outlined in the 2019-2022 Strategic Plan. You can learn more by downloading our 2020-2021 Annual Report from www.ciqs.org or by scanning the QR code (page 10). Thank you to everyone who stayed with us last year, and a sincere welcome to those who recently joined! I hope to be able to welcome you all back for the 2022-2023 membership year. Together we are the voice for Canada’s construction economists! 1
Source: https://www.creacafe.ca/can-housing-upgrades-
affect-insurance/
Message du Directrice Générale
Sheila Lennon, CAE
J
Numéro de printemps 2022
e suis ravie d’annoncer que 2021 a été une autre année phare pour l’ICÉC! Nous comptons à présent 2 085 membres, dont 1 104 économistes en construction agréés et 365 estimateurs en construction certifiés. Nous gagnons également du terrain auprès des économistes en construction de demain, car nous recevons de plus en plus d’adhésions d’étudiants. Je rends hommage à nos incroyables ambassadeurs qui donnent bénévolement de leur temps pour participer à des réunions virtuelles d’étudiants, faire des présentations lors de déjeuners universitaires et de conférences dans tout le pays afin d’informer la nouvelle génération des possibilités passionnantes qu’offre une carrière d’économiste en construction. Au cours des deux dernières années, j’ai souvent dit que les économistes en construction sont très demandés, lors des marchés haussiers et des marchés baissiers, et l’augmentation continue du nombre de membres pendant une pandémie mondiale en est une preuve supplémentaire. Les résultats de l’enquête du quatrième trimestre du Construction Monitor Report soulignent le besoin croissant d’économistes en construction qualifiés, comme l’indiquent les 60 % de répondants à l’enquête qui ont signalé une pénurie de ces professionnels. Ce fait a piqué ma curiosité, et après avoir rapidement saisi « Construction Cost Estimator » sur www.indeed.ca, j’ai obtenu une liste de 485 emplois au sein du Canada. Le Construction Monitor Report du quatrième trimestre a également indiqué une croissance à venir au niveau des infrastructures ainsi que des projets
Home Renovation Projects/Projets de rénovation résidentielle Source: Statista Survey, March 2021/Sondage de Statista, mars 2021
Outdoor/Extérieur 54% Bathroom/Salle de bains 32% Kitchen/Cuisine 23% Basement/Sous-sol 17% Appliances/Appareils 12%
Figure 1: Projets de rénovation résidentielle de la Pandémie
privés et non résidentiels. Ce constat a été confirmé par les rapports publiés cette année par l’Association canadienne de l’immeuble (ACI), les chambres immobilières locales et les agences immobilières privées. Des rénovations DANS VOTRE AVENIR? Informez votre compagnie d’assurances Le secteur de la rénovation résidentielle au Canada est devenu un marché de 80 milliards de dollars. Comme l’indique un article de blogue intitulé « Can housing upgrades affect insurance ? » publié dans le Café ACI,11 27 % des propriétaires canadiens ont rénové leur maison pendant la pandémie, et 20 % de plus envisagent d’entreprendre des rénovations prochainement. Statista.com indique en outre que les trois principales rénovations sont l’aménagement paysager, les salles de bains et les cuisines (cf. le graphique intitulé « Projets de rénovation résidentielle »). Comme le mentionne le blogue de l’ACI, il est toujours prudent de signaler les rénovations majeures à votre
compagnie d’assurances afin de vous assurer que les travaux sont couverts par le régime actuel. Le nouveau partenaire d’affinité de l’ICÉC, Sonnet Assurance, a créé une liste de dix modifications à signaler à votre compagnie d’assurances pour vous assurer de rester couvert pendant les rénovations, ainsi que si les travaux nécessitent une augmentation de votre limite de couverture. Parmi ces modifications : 1. Refaire le toit; 2. Les rénovations majeures, telles qu’un ajout ou une annexe. Vous devez vous assurer que d’être couvert pour chaque étape de la rénovation, surtout si vous modifiez l’intégrité de la structure de la maison; 3. Amélioration et/ou rénovation de l’enveloppe extérieure de la maison. Même si vous n’effectuez pas de rénovations à l’heure actuelle, c’est le moment idéal pour en savoir plus sur le partenariat d’affinité entre l’ICÉC et Sonnet Assurance. Visitez la page d’affinité spécifique à l’ICÉC à partir du portail des membres de l’ICÉC sur www.ciqs.org pour connaître les détails
Spring 2022 | www.ciqs.org | CONSTRUCTION ECONOMIST | 9
Message du Directrice Générale
du programme et obtenir un devis gratuit en ligne. Vous devez être un membre en règle de l’ICÉC pour être éligible à la réduction de l’ICÉC chez Sonnet Assurance. Accédez à tous les avantages offerts à nos membres – renouvelez votre adhésion à L’ICÉC aujourd’hui Les factures de renouvellement de l’adhésion pour 2022-2023 ont été envoyées par courriel le 8 février 2022, et cette année, nous avons facilité encore plus le renouvellement par le biais de notre portail des membres nouvellement lancé. Vos cotisations permettent à l’équipe de l’ICÉC de développer l’organisation sur le plan local, national et international. L’année dernière, bien que nous ayons eu l’impression de vivre une version moderne du film « Le jour de la marmotte », avec un confinement après l’autre toute l’année,
l’équipe de l’ICÉC a travaillé sans relâche en votre nom. Le rapport de L’ICÉC pour 2020-2021 est disponible au téléchargement En 2021, l’équipe de l’ICÉC a : • Conçu et lancé un nouveau système interactif de gestion des membres; • Conçu et lancé un site Web primé pour aider à promouvoir les professions de l’économie en construction et pour mieux servir nos membres; • Publié un nouveau manuel, Construction Project Management, rédigé par Tulsi Regmi, PhD, ÉCA et Bill Nichols, MSc, ÉCA(F), PLE, CSO, FCIOB; • Organisé le premier congrès virtuel de l’Institut sur trois jours; • Élargi notre programme de relations gouvernementales et organisé
des réunions virtuelles avec des représentants du gouvernement fédéral; • Achevé la plupart des tâches décrites dans le plan stratégique 2019-2022. Vous pouvez en savoir plus en téléchargeant notre rapport annuel pour 20202021 sur www.ciqs.org, ou en scannant le code QR. Nous remercions tous ceux qui sont restés avec nous l’année dernière, et souhaitons la bienvenue à ceux qui nous ont rejoints récemment ! J’espère pouvoir vous accueillir à nouveau pour l’année d’adhésion 2022-2023. Ensemble nous sommes la voix des économistes en construction du Canada! 1
Source: www.creacafe.ca/can-housing-upgrades-
affect-insurance (disponible uniquement en anglais pour l’instant)
QUANTITY SURVEYORS, ESTIMATORS, PLANNERS A leading Cost Consulting and Project Management firm requires the following candidates for its Montreal and Ottawa offices: Junior, intermediate and senior level Q.S.’s, Estimators and Planners with experience on: • Commercial and institutional projects • Industrial projects (oil/gas, refineries, mining, metallurgical). We offer competitive salaries, benefits, training and potential for growth. Relocation assistance will be provided. We sincerely thank all applicants, but only those candidates which meet our requirements will be contacted.
Please send resume in strictest confidence to: LCO - Construction and Management Consultants Inc. Fax: 514-846-8913 | Phone: 514-846-8914 | E-Mail: MONTREAL@LCOGROUP.COM
10 | CONSTRUCTION ECONOMIST | www.ciqs.org | Spring 2022
Editor’s Message
Chris Court, PQS(F)
I
An introduction to housing affordability
would like to start by thanking Arif Ghaffur, my predecessor, for his seven years of service. During his mandate, Arif dedicated his time to elevating Construction Economist to its current high standards. I am honoured that the CIQS board has entrusted me with the role of Editor and I am looking forward to continuing the success of “The Journal of the Canadian Institute of Quantity Surveyors.” By way of background, I have been a member of the CIQS since I was a fulltime student at George Brown College in 2000. I was awarded my full PQS membership in 2006 after completing the Test of Professional Experience (TPE), which was a two-year process. I have spent many years volunteering on various CIQS boards (GTA Chapter, CIQS-Ontario Board, and CIQS board) and I was the President of the CIQSOntario Board from 2012 to 2013. I was appointed a Fellow of CIQS in June of 2014 for serving the Institute for a minimum of 10 years and contributing to the prestige and the advancement of the profession through outstanding achievements. I have been Chief Estimator at The Moro Group Builders Inc. (better known as TMG Builders) since 2016. For my first article, I wanted to touch on a hot topic that has been all over the news in the last couple of years: housing affordability. Not a day goes by without seeing an article either in The Star, The Sun, or other local or national publication addressing the topic and how it constitutes a major crisis nationwide. Since the financial collapse of 2008 we have seen property values increasing every year with no end in sight. I remember buying my first property
with my brother in the fall of 2007. We bought a semi-detached house, off plans, with an occupancy of April 2008. The house was two stories with a full basement, approximately 1,700 sq. ft., and the cost was around $287,000. The last time I checked on www.realtor.ca, comparable housing (in size, and location relative to downtown Toronto) is currently slighting over $1 million dollars. That means in 15 years my old property has increased $713,000 which almost works out to a $50,000 annual increase. With the increase to property values, it is understandable that would-be firsttime buyers are faced with a significant challenge when trying to enter the market. In Toronto the average household income in 2019 was $111,900 (pretax, source: Statistics Canada and CMHC). Based on that income and with a $200,000 down payment you could only afford a maximum price of $620,000.1 According to the Toronto Regional Real Estate Board (TRREB), the average selling price for a detached house in the GTA was $1.44 million last year. Based on the GTA average price, a family would need an annual income of at least $200,000 and a down payment of $750,000 to qualify for a mortgage on a $1.44 million property.2 With the high prices for single detached, semidetached, and townhouse properties, more people have bought houses in the condo market with over 32,000 condo apartments sold in 2021. Housing affordability is a perfect storm, brought on by many factors that have contributed to the explosion of housing prices. First the historically low interest rates have allowed many investors (locally and internationally) and other buyers to qualify for these
high mortgages. The Bank of Canada announced on January 26, 2022 that they will be keeping the interest rate of 0.25% even though most financial predications assumed an interest rate hike. So, the housing market will continue to inflate until the Bank of Canada decides to increase the interest rate. The second factor has been the supply of homes coming to the market. Between the new pre-construction condos and other houses (resale and new construction) coming onto the market, there has not been enough supply to satisfy the current demand. According to BILD, at the end of 2021 there were only 2.3 months-worth of inventory available on the market.3 Typically, 9-12 months of supply would be seen as a balanced market. Based on the available reports, Canada currently has the lowest supply of housing among the G7 nations. Factors that have contributed to this include delays in construction start resulting from elongated local government approval processes. The Toronto Star published an article on January 23, 2022, describing how a Toronto semi-detached home drew 100 offers and was sold for $400,000 over asking.4 More listings are needed on the market or this trend will continue with every sale going forward. Another reason for the lack of supply may be that potential sellers hesitate to list their current property for fear that in the current market, they would not be able to afford the purchase of the next property that would fit their needs. The third factor has been the continuously increasing growth of the GTA population every year, which also puts a significant strain on the supply
Spring 2022 | www.ciqs.org | CONSTRUCTION ECONOMIST | 11
Editor’s Message
of new homes and rental properties. “Each of the six regions of the province are projected to see growing populations over the projection period. The Greater Toronto Area (GTA) is projected to be the fastest growing region, with its population increasing by 2.9 million, or 40.9%, from 7.1 million in 2020 to almost 10.0 million by 2046. The GTA’s share of provincial population is projected to rise from 48.0% in 2020 to 49.8% in 2046.”5 With all these factors affecting prices, another issue has been that people who cannot afford to buy have been forced to stay on or enter the rental market. This has caused the rental market to drop to a very low vacancy rate and has caused increased bidding wars which contribute to increased rent prices. During the early days of the COVID-19 pandemic, rental rates dropped for a while, but based on
For my first article, I wanted to touch on a hot topic that has been all over the news in the last couple of years: housing affordability. the resale and new construction supply issues, the rental market is almost back to its pre-pandemic levels. The market analysis is now predicting that rent prices are expected to climb at least 11% in 2022.6 If you are looking to get into the market with either buying or renting, it looks like you will be paying more than you might anticipate. With the interest rate set to increase next month, current home owners with variable interest rate mortgages will be affected as well.
ARE YOU READY TO TAKE THE NEXT STEP IN YOUR CAREER?
JOIN OUR TEAM www.conecon.ca
12 | CONSTRUCTION ECONOMIST | www.ciqs.org | Spring 2022
In my next Editor’s Message I plan to take a close look at possible solutions to the housing crisis, including solutions proposed or contemplated by other industry experts. If you have feedback, suggestions, and of course, any articles that you would like to be considered for publication, please email editor@ciqs.org or ceo@ciqs.org. Chris Court, PQS(F) Editor References 1 Results obtained using the CIBC mortgage affordability online calculator – Income of $111,900, down payment - $200,000, 5 year fixed closed, 3.09% interest rate, 25-year amortization period, monthly payment $2,005. For reference and illustration purposes only. 2 Results obtained using the CIBC mortgage affordability online calculator – Income of $200,000, down payment - $750,000, 5-year fixed closed, 3.09% interest rate, 25 year amortization period, monthly payment $3,350. For reference and illustration purposes only. 3 The Sun – Housing Industry Takes Aim at Affordability Issue by Paul Barker (Feb 11, 2022). 4 The Star – 100 Offers on a Single GTA House: Why Scarce Listings Are Further Driving Up Home Prices by Tess Kalinowski (Jan 23, 2022). 5 www.ontario.ca/page/ontariopopulation-projections. 6 blogT0 – Toronto Rent Prices are Expected to Climb a Whopping 11% Next Year by Lauren O’Neil.
Education Corner
Adam Ding, PQS
W
Why do we need more CECs?
hat kind of designation does CIQS provide to its certified members? Although some people visualize only “quantity surveyors” when looking at the Institute’s name, the correct answer is that the CIQS grants two designations: Professional Quantity Surveyor (PQS) and Construction Estimators Certified (CEC). Both PQS and CEC members play important roles in Canada’s construction industry. Recently, I took the opportunity of attending a few CIQS educational webinars hosted by Sharon Lui, our event specialist. A frequent (probably ever-present) inquiry was: what is the difference between PQS and CEC? Although the answer can be quickly located by visiting the official CIQS website, it is important to examine this question a bit further. Our latest statistics (2021) reveal 1104 PQS members and 365 CEC members registered with the CIQS, which suggests there is plenty of room to grow our CEC population. There are numerous reasons/advantages to become a CEC. I will list just a few: • Most people seem to understand who a cost estimator is and accept what he or she does. • There is always a need for construction estimators in both big cities and small towns, which is very important considering Canada’s vast geographic regions and population distribution. • Many construction estimators are regularly hired by general contractors and subcontractors in ICI, heavy/civil, and home building sectors. Cost consulting firms also respect these estimators’ real-time contact with market price info and field experience exposure. • The current CIQS syllabus has a structured (probably also unique in Canada) estimating curriculum for CEC, which covers essential knowledge such as construction technologies, work measurement, contracts, building codes, etc. • In addition to the architectural syllabus, it is also possible for members to achieve CEC designation by following the mechanical or electrical track (and also upcoming civil). The current CIQS reciprocity agreement with the Canadian Construction Association allows our CEC members direct access to the Canadian Construction Association’s Gold Seal Certification program exam for estimators (on provision of a current letter of reference and competency self-assessment). Specifically, I would like to encourage: • Individuals to discover both designations the CIQS offers and decide which one is right for you. For example, you might find the CEC more aligned with your specific job duties in your local region. • Companies to evaluate your business needs and consider sponsoring employees’ professional development using the
CEC curriculum. Our CEC members have been consistently delivering impeccable solid work performance results for employers of various kinds. • Technical colleges to explore the CEC accreditation possibilities with the CIQS. The construction industry always has a shortage of qualified estimators. Your program might be able to train more students to meet that demand with the CIQS CEC accreditation in place, while not having to develop and deliver too many additional new courses. At the time of this article, lockdown restrictions are being phased out in almost every province. Considering the current market trend, 2022 might be another booming year for our construction industry. For those who have the ambition to be construction estimators, there is never a shortage of work in sight. If you or someone you know would like to become a Construction Estimators Certified (CEC) with CIQS, please do not hesitate to look into this great career path!
Stimulus + Compliance = Building for Success As money starts to flow into shovel-worthy projects, Osler’s Chambers Band 1 Construction Group has the industry expertise and legal insight to help you identify opportunities and manage risks — so you can be sure you’re always on solid ground. Contact Richard Wong at rwong@osler.com Visit our blog osler.com/constructionblog Osler, Hoskin & Harcourt llp osler.com
Spring 2022 | www.ciqs.org | CONSTRUCTION ECONOMIST | 13
Legal Corner
Richard Wong
Cristina Cosneanu
Maggie Fortin
Alexandra Romcea
Construction contracting in an inflationary environment: material price adjustment clauses in the Canadian context
A
s the global economy, supply chains, and labour forces struggle to adapt to turbulent supply and demand conditions, one of the noticeable ripple effects felt by the construction industry, whether through project planning, procurement, contract management, or disputes groups, is the recent general rise in resource costs, notably material prices. While lumber prices made headlines in 2021 by quadrupling over 12 months (and then receding), surges in other major commodities such as steel, concrete, copper, have also materially impacted the development of many capital projects. Alongside delays in material supply and labour shortages – both of which are beyond the scope of this article – commercial responses to material price increases have varied significantly between public and private owners, general contractors, subcontractors, as well as by industry. As the majority of contracts are fixed or unit price based, there have been numerous internal and external discussions regarding impact and strategy on current and future projects. Some owners have started to reclaim the procurement role from EPC contractors for key materials to leverage greater buying power and better pricing, while contractors revisit their contingencies and allowances and seek adjustment or similar mechanisms, including insurance, for commercial relief. While prior authors, including former Managing Editor Arif Ghaffur in CE’s Summer 2021 issue, underscored the crucial role of quantity surveyors in advising clients through these difficult times, this article focuses on contract terms and provides some examples and considerations, from a drafter’s perspective, around material price adjustment clauses.
GC 6.7 – MARKET FLUCTUATIONS 6.7.1 If at any time after the date of bid closing and through no fault of the Contractor, its Subcontractors, Suppliers or any other person for whom the Contractor is responsible at law: .1 the market price of [e.g., lumber/copper/steel] in [Ontario/Canada] increases by [X%] or more; or .2 there is a shortage in the market supply or availability of [e.g., lumber/copper/steel] in [Ontario/Canada] that causes a delay of more than [X] days to delivery of a Product to the Place of the Work despite the Contractor’s use of commercially reasonable efforts, this shall constitute a change to the Work for which the Contractor is entitled to adjustment of the Contract Price and/or Contract Time in accordance with Part 6 – CHANGES IN THE WORK. 6.7.2 The Contractor shall provide the Owner with Notice in Writing within [5 Working Days] of becoming aware of any changed market condition described in paragraph 6.7.1, which Notice in Writing shall include the particulars of the alleged changed market condition. The Owner, through the Consultant, shall then issue a Change Order or Change Directive as provided in GC 6.2 – CHANGE ORDER or GC 6.3 – CHANGE DIRECTIVE or shall otherwise dispute the Contractor’s claim in accordance with PART 8 – DISPUTE RESOLUTION. Adjusted Unit Price = I/B × 𝐿 × 𝑃 + (1 − 𝐿) × 𝑃.
Where: Canada In Québec, the Société québécoise des infrastructures (SQI) recently announced that, on a temporary basis from 2022 to November 2023, it will insert a price adjustment clause in many of its otherwise fixed-price contracts for public works. This clause will allow the owner to benefit from a general fixed price while 14 | CONSTRUCTION ECONOMIST | www.ciqs.org | Spring 2022
B = Global Carbon Steel Index (GCSI) for base period I = GCSI for the month preceding the month of reassessment of the price L = Percentage of the price subject to adjustment P = Base unit contract price
Legal Corner
allowing for volatility of material prices through a mutually agreed-upon adjustment mechanism triggered by a +/- 5% variation of the price of certain impacted materials between the time of bid submission up to contract execution. While the standard clause has not been made public as of February 22, 2022, SQI has revealed a list of several dozen materials to be subject to this mechanism, including concrete, steel and lumber (pine, spruce and fir). The Ontario General Contractors Association (OGCA) has developed a series of sample contract and subcontract fluctuation clauses for consideration. One example, for use in a CCDC 2-2020 fixed-price contract, reads as follows: The OGCA offers that such clauses would render bidding processes more competitive, as bidding prices would be based on actual market prices with a possibility of adjustment later on, rather than be based on already-inflated prices that reflect varying contingencies. Finally, the federal government in December of 2020 published the Practitioner’s Guide for Procurement Pricing (the Guide), which contains several recommendations regarding Economic Price Adjustments (EPAs). After providing several alternatives to EPAs, such as the postponement of the procurement or the use of available substitute products, the Guide addresses how such EPAs would work. Guiding principles are that the price adjustment method should be as simple as possible and require the least administrative effort, while protecting both stakeholders. Key elements include a ceiling price and could also include a trigger point to identify when the EPA would apply. A sample EPA formula in the context of carbon steel price fluctuations is reproduced below: United States Turning to the US, economic price adjustment clauses within federal fixed-price contracts are specifically addressed in the Federal Acquisition Regulation (the “FAR”), the main regulation that oversees the acquisition of supplies and services by the federal government. FAR Subpart 16.203 – Fixed-price contracts with economic price adjustment – sets out three general types of economic price adjustments: (1) adjustments based on established prices, which “should normally be restricted to industry-wide contingencies”, (2) adjustments based on actual costs of labour or material, which “should be limited to contingencies beyond the contractor’s control”, and (3) adjustments based on cost indexes of labour or material. The stated objective of such clauses is to protect both the government and the contractor against cost fluctuations. More tellingly, FAR Subpart 16.203-2 provides that “a fixed-price contract with economic price adjustment may be used when (i) there is serious doubt concerning the stability of market or labor conditions that will exist during an extended period of contract performance, and (ii) contingencies that would otherwise be included in the contract price can be identified and covered separately in the contract.”
Some American standard form documents have provisions addressing material price volatility. ConsensusDocs offers a price adjustment clause to mitigate the risks of profit losses which includes strategies such as prefabrication, early procurement of materials and the breakdown of a project into phases. Conclusion As with the more general revisit of contractual force majeure clauses in light of COVID-19, material price adjustment clauses are being carefully considered. Drafting approaches range from the formulaic to the principled, and can range in detail and length from several sentences to several pages. Notable features will depend on specific circumstances, but interested parties should consider some of the following when working to implement them with their legal team: • Base price and time base price is set. • List of subject materials. • Representative index of escalation/mechanism for adjustment. • % of base price subject to indexation. • Threshold to trigger adjustment (e.g. event or % change). • Whether the increase was the fault of the contractor. • Time window where adjustments permitted. • Maximum adjusted price (which may cap the increase, or suspend the contractor’s obligation to obtain material). • Whether clause contemplates increase vs. increase and decrease. • Timing and method of settling adjustment. • Whether to characterize the adjustment as a change to allow the owner to decide which path to take (e.g. Obtaining multiple proposals, owner deciding to source instead), and the consequences of each. These are just a few possible approaches to consider in addressing material price escalation issues. We expect to see continued interest by industry players, including owners, contractors, and lenders, in addressing material price fluctuations in a clear and manageable way.
About the authors Richard Wong, Cristina Cosneanu, Maggie Fortin, and Alexandra Romcea are employees at Osler, Hoskin & Harcourt, LLP. Osler is a leader in Canadian business law with a singular focus – your business. With an integrated network of offices in Toronto, Montréal, Calgary, Ottawa, Vancouver, and New York, Osler, Hoskin & Harcourt, LLP solves problems, removes obstacles, and provides the answers you need, when you need them.
Spring 2022 | www.ciqs.org | CONSTRUCTION ECONOMIST | 15
Prompt Payment
Sahil Shoor
O
Prompt payment framework in the province of Alberta
n February 25, 2022, the Province of Alberta proclaimed the Prompt Payment and Construction Lien Act (the “Act”), formerly known as the Builders’ Lien Act, to be in force on August 29, 2022. The Province also introduced related regulations that fill in details around the Act, particularly around the new adjudication regime. Under the new legislation, owners will have a 28-day timeline to pay proper invoices from general contractors. Contractors and subcontractors will be required to pay their own subcontractors within seven calendar days of being paid themselves. The Act introduces various amendments to the former construction legislation relating to payment and invoicing as well as disputes and adjudication. In addition, the Province of Alberta introduced the Builders’ Lien Forms Amendment Regulation as well as the Prompt Payment and Adjudication Regulation. Builders’ Lien Forms Amendment Regulation This Regulation sets out the new forms required under the Act, in particular: 1. Between owners and contractors, the Notice of Dispute under section 32.2(2) of the Act (Form 1); 2. Between contractors and subcontractors, the Notice of non-payment under sections 32.3(5) and 32.3(6) of the Act (Forms 2 and 3); and 3. Between subcontractor and subcontractor, the Notice of non-payment under sections 32.5 (6), and 32.5(7) of the Act (Forms 4 and 5). In addition to the Act’s proclamation, the Province of Alberta introduced the Builders’ Lien Forms Amendment Regulation as well as the Prompt Payment and Adjudication Regulation. Prompt Payment and Adjudication Regulation This Regulation contains three main parts. The first relates to Lien, Prompt Payment, and Right to Information; the second to Nominating Authority and Administration; and the third to Dispute Adjudication. 1. Lien, Prompt Payment, and Right to Information: This regulation provides clarification on: conditions for payment of amounts retained (under section 24.1(2) of the Act), time for proper invoices (under section 32.1(6) of the Act), rate of interest on late payment (under section 32.6 of the Act), and the requirements for statement of accounts (under section 33(3)(d) of the Act). 2. Nominating Authority and Administration: This regulation outlines the designation, qualifications and duties of a Nominating Authority. The Nominating Authority is
a body designated to oversee the appointment of adjudicators and the adjudication process. 3. Dispute Adjudication: This regulation details the matters that may be referred to dispute adjudication under the Act, as well as the processes relating thereto including notices, determination of matters, termination of adjudication, resignation by adjudicator, adjudicator’s failure to conclude adjudication, and consolidation of adjudication. In particular, section 19 outlines the matters which can be adjudicated: 1. The valuation of services or materials provided under the contract or subcontract, including in respect of a written change order, whether approved or not, or a proposed change order, as the case may be; 2. Payment under the contract or subcontract, including in respect of a written change order, whether approved or not, or a proposed change order; 3. Disputes that are the subject of a notice of non-payment under Part 3 of the Act; 4. Payment or non-payment of an amount retained as a major lien fund or minor lien fund and owed to a party during or at the end of a contract or subcontract, as the case may be; and 5. any other matter in relation to the contract or subcontract, as the case may be, that the parties in dispute agree to, regardless of whether or not a proper invoice was issued or the claim is lienable. I look forward to sharing further aspects of Prompt Payment and Adjudication in the future editions of Construction Economist.
About the author Sahil Shoor is a Partner with Gowling WLG (Canada) LLP. He is called to the Bar in both Ontario and British Columbia. His national practice is focused on complex litigation and dispute resolution in the sectors that drive Canada’s economic development, including commercial construction, real estate development, infrastructure and civil works, power and energy (nuclear, hydro-electric and power generating stations) and transit/transportation (P3). Most recently, Sahil was recognized as “Top 40 under 40” in Canadian Construction in 2021 by On-Site and SitePartners and the “Next Generation Partner” by Legal 500 Canada 2022. Spring 2022 | www.ciqs.org | CONSTRUCTION ECONOMIST | 17
CIQS CONGRESS 2022 COMING TO OTTAWA, LIVE AND IN PERSON Everyone at CIQS is excited to invite you to join us on June 16-18, 2022, for our first in-person Congress since 2019. The event begins with a networking reception at TwentyTwo, a magnificent event space atop The Westin Ottawa featuring panoramic views of Parliament Hill. Stop in, have a drink, and reconnect with fellow members whom you have not seen since before the pandemic.
The theme of this year’s Congress is ASSEMBLE | ADVOCATE | LEAD and it is focused heavily on education. PQS and CEC members who attend all education sessions will earn 12 of their required 50 CPD points in just two days! We have designed a sponsorship program to meet a wide range of marketing goals and budgets. It includes three annual opportunities that run between $5000 and $20,000, as well as Congress-specific opportunities ranging from $250 to $5,000. The annual opportunities offer benefits throughout the CIQS fiscal year, such as postings on the CIQS job board, webinar and podcast sponsorships, advertising opportunities as well as recognition at, and/or tickets to, Congress. Anyone interested in learning more about this year’s sponsorship program is asked to contact Alexandra Parliament at marketing@ciqs.org.
18 | CONSTRUCTION ECONOMIST | www.ciqs.org | Spring 2022
WHY SPONSOR CIQS? Awareness Grow your corporate brand within the Quantity Surveying industry
Visit the CIQS Congress page on www.ciqs.org for program details, the sponsorship prospectus and to register for the event.
Investment Be a benefactor for CIQS to mature as the voice for Canada’s construction economists Expertise Gain knowledge from industry experts We would like to thank those companies who have confirmed their sponsorships to date: HANSCOMB |SONNET INSURANCE | CCI | RIDER LEVETT BUCKNALL | BORDEN LADNER GERVAIS LLP
About the author Alexandra Parliament is a Marketing and Communications Consultant with 25+ years of experience. She has a formal education in print journalism and has worked in the marketing and communications departments of a PR agency, a major marketing agency, a national magazine, an annual three-day festival, provincial and national non-profit organizations, and one of the largest loyalty programs in Canada. She has been published in a variety of magazines and online publications. She has been working with CIQS in a PR/Marketing capacity since November 2018.
Combines the experience of both in-house and external counsel ADJUDICATION, LITIGATION, ARBITRATION COURSE OF PROJECT ADVICE – DISPUTE AVOIDANCE CONTRACT DRAFTING AND NEGOTIATION COLLABORATIVE CONTRACTING TRAINING jmargie@margiestrub.com jstrub@margiestrub.com www.margiestrub.com 647-792-0010
Spring 2022 | www.ciqs.org | CONSTRUCTION ECONOMIST | 19
Decarbonization – Buildings and
Canada’s journey to net zero
R
ising concentrations of greenhouse gases (GHG), especially Carbon dioxide (CO2) are causing the earth’s global average temperature to increase. Hence, the world is on a mission to lower human-activity’s CO2 releases into the planet’s atmosphere, and achieve net-zero. At the 26th United Nations’ Conference of the Parties (COP26) meeting held last December in Glasgow, Scotland, government and business leaders agreed to keep alive the goal of limiting global average temperature rise relative to preindustrial times to within 1.5oC. Scientists have determined that global GHG emissions must be halved by 2030 and net zero reached by 2050, if we should stand a chance to meet the 1.5oC target. The implication of the COP26 agreement is that ongoing climate actions must continue to be scaled up across the world. Canada updated its Nationally Determined Contribution (“NDC”) in 2021 and committed to reduce its own emissions by 40-45% below 2005 levels by 2030, on the path to netzero emissions by 2050. Canada aims to achieve this through a $15 billion climate plan comprising 64 federal policies, programs and investments that will create inclusive and equitable jobs needed to enable transitions to clean energy and reduce greenhouse gas (“GHG”) emissions. Under the updated plan, Environment and Climate Change Canada projects that, by 2030, Canada’s total greenhouse gas emissions will be 503 Mt CO2e, i.e., about 8 Mt CO2e below the plan’s target (of 511 Mt CO2e). How would buildings and the construction industry progress under Canada’s Decarbonization plan, and what roles could construction economists (PQS and CEC) have towards these plans? Canada’s climate plan and the built environment In June 2021, the Canadian Net-Zero Emissions Accountability Act received
1Canada’s building (Photo by Redd on Unsplash).
Guidance from construction economists (PQS and CEC) are needed towards decarbonization in the built environment (Photo by Amy Hirschi on Unsplash).
Royal Assent, and became law. The Act gave legal backing to Canada’s commitment to its national emission reduction targets, and made the goal of 40-45% emission reduction by 2030 legally binding. It also mandated that an emission reduction plan must be developed through public participations and broad consultations with Canadians, including Indigenous communities. This is on the heels of the declaration of climate emergencies and setting up of net-zero commitments by several cities and municipalities across Canada. Estimates indicate that Canada is one of the world’s top 10 GHG emitter per
20 | CONSTRUCTION ECONOMIST | www.ciqs.org | Spring 2022
capita, at around 20 tonnes CO2e. The ways we produce energy, crisscross our vast lands, and how we heat our buildings during cold seasons mainly account for this high emission profile. Canada must transform how it produces and uses energy. The built environment accounts for almost one-fifth of Canada’s annual emissions and almost 40% of global emissions across its design-construction- operation-disposal lifecycle, and has shown good potentials to decarbonize. Many Canadian buildings that will exist by 2050, the net-zero target date, are already standing and there are opportunities to make sure future constructions are fit for climate.
Lowering emissions in Canada’s built environment The two types of emissions commonly defined for buildings are operational and embodied carbon emissions. The former are well understood as the emissions generated from operating buildings, such as providing heat, cooling, electricity, etc. The latter are those emissions locked into a building through construction; this type of emission is largely unnoticed partly because it presents a relatively shorter timescale compared to operational emissions that run through the life of the building. Whole building Life Cycle Assessments (“LCA”) can be used to quantify the amount of carbon emissions for buildings, identify carbon ‘hot spots’, and aid better design and decision making. Structural systems have been estimated to account for around fourfifths (80%) of a building’s embodied carbon. The emissions released from the manufacture of steel beams for example, would count towards the embodied emission of the buildings in which they are used. Materials with low carbon impact such as engineered timber are gaining traction as alternatives to steel. UBC Brock Commons Tallwood House (Figure 1), one of the world’s tallest timber buildings, is estimated to have avoided or sequestered more than 2,432 tonnes CO2e of greenhouse gas emissions by using wood instead of steel for construction. The result of an LCA can also be used to assign a carbon factor when estimating costs of materials and labour used in construction. Operational emissions in Canadian buildings are largely driven by space heating with fossil fuels, or electricity when sourced from non-renewable fuel. Transitioning Canada’s electricity grid away from fossil to 100% renewable sources and switching from natural gas heating to electric heat pumps will decarbonize that aspect of building operation. Unfortunately, heat pump technology using electricity is still relatively inefficient, usually relying on auxiliary or backup heat to supplement during the colder months. To solve this challenge, in 2021, Natural Resources Canada partnered with the US Department of Energy and six leading North American HVAC manufacturers to
The 18-Storey University of British Columbia Students Residence, Brock Commons Tallwood House, is one of the world's tallest timber buildings (Image from naturally:wood).
accelerate research and development of cold climate heat pumps with increased performance, improved efficiency, and demand flexibility. These technological transformations – along with the enabling legislations, funding, industry collaborations, and social awareness – are being counted on to help Canada meet the 40-45% emissions reduction target by 2030. Participating in Canada’s climate plan The public consultation for Canada’s 2030 Emission Reduction Plan was started in December 2021 and had overwhelming response. The plan, now set to be released by late March 2022, will set the policy framework and pathway for the 2030 goals. This will also be the bedrock for more ambitious climate actions for 2035, 2040, and on to 2050, in alignment with the 5 year accountability cycle set by the Paris agreement. This indicates that decarbonization actions will become increasingly stringent and include transformational changes for the construction industry. New constructions will have to meet updated sustainability standards, and existing buildings will need to be retrofitted to meet new guidelines for energy efficiency and resource utilization. The minimum federal carbon pricing established in 2019 is set
to increase by $15 each year from 2023, reaching $170 per tonne CO2e by 2030. On the path to decarbonization, Canada’s building and construction owners will require guidance from construction economists about the economics of carbon pricing.
About the author Ayo Daniel Abiola, PQS is the Engineering Manager for the Energy and Sustainability Services (ESS) at Black and McDonald Limited. He has experience delivering mechanical services and sustainability solutions for buildings and infrastructure development. He has also contributed to the development of resilient renewable energy infrastructure for the Canadian climate and environment. Ayo is a professional engineer, licensed in Ontario, and Certified Energy Manager. He has provided services for construction projects and developments located across Canada, US, and the Middle East.
Spring 2022 | www.ciqs.org | CONSTRUCTION ECONOMIST | 21
ALLIANCE CONTRACTING –
A COLLABORATIVE
PROJECT DELIVERY MODEL
I
magine a large, complex, construction project that does not end with claims and disputes. It sounds oxymoronic. The construction industry is mired in disputes. The inherent incentives in the typical contract models drive parties to take positions that benefit their organization, typically to the detriment of their contracting partners and generally to the detriment of the project. Those incentives exist at the corporate level but then trickle down to drive the behaviours of the individuals who are managing and building the project. The result is that projects often exceed their budgets, extend beyond their completion date, and result in disputes where no one wins except for the lawyers. What if there was another way? What if a contract structure could be set-up that promotes true collaboration and best-forproject outcomes? What if, instead of taking positions to protect their organization, project participants were not only free, but incentivized, to find the best solution for the project? What if, instead of suppressing innovation and collaboration, the contracting structure promotes it? Alliance contracting is the answer. Many of the problems plaguing our industry are solved by alliance contracts and, as a result, alliance contracting has experienced incredible success in Australia, New Zealand, the UK, and beyond. It is now starting to make its way into the Canadian market with the Union Station Enhancement Project and with the Hamilton LRT project. Alliance contracting shifts the traditional project delivery model on its head. Instead of parties entering a series of bilateral contract (contracts between two parties), they enter into an Alliance Agreement where the owner, contractor (or multiple contractors), designer (or multiple designers), and others all sign a single, multi-party agreement. An Alliance Agreement is founded on the following key principles: shared risks and rewards, best-for-project decision making, win-win or lose-lose outcomes, challenge and collaboration, unanimous decision-making, equity and transparency, and NO DISPUTES. The commercial structure The commercial structure is rather simple and is based upon a “Target Outturn Cost” or “TOC” model with an agreed amount of corporate overhead, an agreed amount of profit, a shared risk pool, and a “Gain Share/Pain Share.” The Alliance, consisting of both the Non-Owner Participants (“NOPs”) and the owner, collaboratively establishes the TOC.
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Profit/Fee NOP Corp. Overheads Contingency/Risk Pool Indirect Cost (Project Overheads)
Direct Cost
An example of a TOC build-up is shown in the image above. During performance of the project, the Direct Costs and the Indirect Costs (Project Overheads) are fully reimbursable and are charged and paid on a fully open-book basis. The reimbursable status of the Direct Costs and Indirect Costs is steadfast, even if the actual Direct Costs and Indirect Costs exceed the TOC. In other words, in no event will the NOPs be responsible for payment of any actual Direct Costs and Indirect Costs without reimbursement from the owner. The risk carried by the NOPs is with respect to their Corporate Overheads and their Profit/Fee. If the Direct Costs and Indirect Costs exceed the budgeted amounts, the Contingency/Risk Pool (if any) may be utilized but then the Corporate Overheads and the Profit/Fee of the NOPs begin to erode. In other words, the NOPs may finish the project with some “Pain Share” – that is a loss of some or all of their anticipated profits and recovery of their Corporate Overheads. Below is an image of two different alliance project outcomes, one where the actual costs are below the TOC and the other where they are above the TOC. In the first outcome, the NOPs experience a “Gain Share” and their profits therefore increase substantially (the Gain Share may be all or a portion of the savings). In the second outcome, the NOPs experience a “Pain Share” and lose all
Profit/Fee = Pain Share NOP Corp. Overheads Contingency/Risk Pool Additional Profit/ Fee = Gain Share
Indirect Cost (Project Overheads)
Profit/Fee NOP Corp. Overheads Contingency/Risk Pool Indirect Cost (Project Overheads) Direct Cost Direct Cost
of their expected Profit/Fee and obtain no recovery for their Corporate Overheads – but still the NOPS are not required to cover the cost overruns. In addition to the TOC, there may be further incentives available to the Alliance in the form of KPIs which should (although do not always) sit outside of the TOC structure and analysis. The methods for paying profits vary widely. For example, profits might not be paid until the completion of the project when the actual costs can be compared against the TOC. In other cases, profits are paid out at agreed milestones. Profits may also be paid out as a percentage of profits. In all cases though, the NOPs’ liability is limited to their actual profits (or lack thereof). The legal structure An “Alliance” is a fictional entity. It is a virtual company. It is a creature of contract. While an Alliance carries similarities to an unincorporated joint venture, including the critical concept of joint and several liability, the Alliance does not enter into a contract with the owner. Instead, all of the contracting parties and the owner enter onto a single agreement – the Alliance Agreement. The parties to an Alliance Agreement are made up of the owner and the NOPs. This is a major shift from traditional model of a series of bilateral contracts and instead brings everyone, including the owner, into the same sandbox. The owner and the NOPs establish an Alliance Leadership Team consisting of executives of each party, or project sponsors, much like an executive committee of a joint venture or partnership. However, despite being members of their respective organizations, the members of the Alliance Leadership Team are required, by contract, to act only in the best interests of the project, in accordance with the Alliance Charter. A violation of this requirement is one of the few matters that can expose a party to a dispute and to liability.
The Alliance Charter is an agreed statement of: (a) the Alliance’s vision, (b) the Alliance’s purpose, (c) the principles that the Alliance will adhere to, (d) the objectives of the Alliance, and (e) the expected values and behaviours of all those involved in the Alliance. The Alliance Charter may sound like “fluff,” but it is not. It is a commitment made by the owner and the NOPs and it is a contractual document, binding on all members of the Alliance. At the level of the Alliance Leadership Team, decisions are to be made unanimously – and on a best-for-project basis in accordance with the Alliance Charter, not by majority rules. This means that the parties are not free to think only about what is best for their organization – rather they must think about what is best for the project. They must challenge each other and work together to find the outcome that everyone can agree is best for the project. Perhaps most importantly, Alliances have a no blame and no disputes clause in the contract. When entering into an Alliance, the parties explicitly agree not to sue, litigate, or arbitrate with one another (with limited exceptions such as willful default). Importantly, if an Alliance Leadership Team member does not vote in a manner that is “best-for-project” in accordance with the Alliance Charter, it may be a willful default. Why does the Alliance model work? The Alliance model is effective as it strips away the barriers to true collaboration by removing the risk that are inherent in other project delivery models. It also aligns the interests of the parties such that what is good for one party is good for all parties. This enables the project participants to share ideas, collaborate, challenge each other, and find innovative solutions to each problem that is best for the project and not necessarily for their individual organization. When decisions are made on a best-for-project basis, the person or party most capable of performing the job will perform it because that is the best outcome for the Alliance which in turn results in the most cost-effective result. Therefore, if it makes sense for scope to shift from one NOP to another, saving cost, time or both for the Alliance, the scope is shifted. Spring 2022 | www.ciqs.org | CONSTRUCTION ECONOMIST | 23
For an owner, the Alliance model allows not only complete transparency but also ensures that the owner is not paying the private sector to take on risks that cannot be easily quantified (such as system integration risks, legacy utilities, etc.). The owner also does not need to worry about dealing with claims. As recently stated by Kris Jacobson, Metrolinx’s technical project lead for the Hamilton LRT (in an article published in the Daily Commercial News): “That’s the nice part about the collaborative model, especially the Alliance contracting model, we don’t have to waste time debating, you know, what’s an appropriate claim, what’s an appropriate delay.” But perhaps even more important is that the Alliance gives the owner a seat at the table with the NOPs, not just as their client, but as their partner. In this sense, the Alliance model is the true Public-Private Partnership. When parties are free to collaborate, be wrong, challenge, and innovate, costs are driven down, schedule is accelerated, and profits are driven up – it is a win-win. But the model does not only drive successful commercial outcomes, it improves the mental health of the participants who are working in a collaborative team environment of mutual success rather than an adversarial environment of win-lose. Not only is improved mental health an important goal in and of itself, but projects are built by people and if the people are happy, they are motivated to work together and succeed together. An important cautionary note is that the contract alone does not drive success. Rather it is a relationship founded
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on trust and on mutual challenge, which is then codified into the Alliance Agreement, which drives success. The Alliance Agreement is structured to facilitate this relationship of trust and collaboration, not to create it. Where are the skeletons in the closet? Alliance contracting is not soft and fluffy. Like any other contract this is a hard-nosed business approach to construction. Therefore, like any other contract, the devil is in the details. The principles and key features of an Alliance described in this article can be varied and parties seeking to enter an Alliance must be keenly aware of what they are agreeing to. There can always be skeletons in the closet, especially if the owner likes the idea of the Alliance but is not willing to buy into the principle of “best-for-project” and prefers a “best-for-owner” approach. Violations of these principles can come in all shapes and sizes. Of course, an owner will always need to retain some residual discretionary control or power – but the nature and extent of that residual control or power could destroy the very foundation that the Alliance is built upon. Conclusion P3 projects flourished in Ontario and in Canada. But their costs have continued to climb as disputes arise and the private sector pushes back on the public sector’s attempts to download all the risk. Hopefully Canadian procurement agencies will soon recognize the benefits of alliance contracting which have been proven elsewhere in the world. The Union Station Enhancement Project is a start. But as the first of its kind in Canada, much is riding on its success and, unfortunately, it deviates from many of the key principles that have driven the success of the pure Alliances that have flourished elsewhere in the world. This risks the viability of alliance contracting in Canada. If the Union Station Enhancement Project is unsuccessful, the Canadian construction market may see it as a cautionary tale and alliancing may be dead in its tracks. Hopefully future Canadian alliances, such as the potential Hamilton LRT, will more closely align with the key principles of pure alliancing. If structured properly, the Canadian taxpayers (and private owners) have much more to gain from alliance contracting going forward.
About the author Joshua Strub, BESc (Civil), JD is Partner* at Margie Strub Construction Law LLP. Josh is a skilled construction lawyer with a civil engineering degree as well as both private practice and in-house experience. He quickly grasps and simplifies complex construction issues and provides efficient, high-quality legal advice. Josh regularly writes and speaks on construction issues and teaches Construction Law at Western Law, in London, ON.
In memoriam –
Ian Duncan, PQS(F) 1950-2021
It is with great sorrow that we announce the passing of Ian Duncan, PQS(F) on December 26, 2021. Ian was a pillar of the CIQS family. He was a long-standing member of the Institute who dedicated himself to CIQS. He was one of CIQS s greatest supporters who was influential within the Institute as well as the quantity surveyor profession in Canada and abroad. At the time of his passing, he was a member of the CIQS Education Committee, and he offered his expertise in the field of quantity surveying as the CIQS membership assessor. Ian joined CIQS in 2000, earned his PQS designation in 2002, received the CIQS Award of Merit in 2008, became a Fellow in 2010, and was awarded Honorary Life in 2021. He will be truly missed by the CIQS staff who had the pleasure of working with him for all these years, as well as all others who knew him. Our thoughts and prayers go out to his dear wife Tyra and their children in their time of sorrow. -Sheila Lennon, CEO of CIQS
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Tribute to Ian by Arif Ghaffur, PQS(F) My name is Arif Ghaffur and I am grateful to Tyra, Alexander, Natasha, and the family for providing me this opportunity to say a few words for my dear long-term friend, Ian. My memories of Ian are so many. What started with a professional interaction, elevated to personal friendship over a long period of time – all founded on trust and of course large doses of humour. We shared so many great stories and moments. I recall my first in person meeting with Ian around 2008 in Streetsville, Mississauga over lunch that took much longer than planned, as we often exchanged “war stories.” Well, that’s what I thought but don’t forget, Ian had been there, done it, and got the t-shirt – a well-travelled person who had “been in the trenches,” making him streetwise. What clearly hit me from when we met was that Ian had a unique mixture of humility and a wickedly dry sense of humour sometimes disguised in a stoic demeanour. Ian was like an accomplished negotiator who knew what the end game looked like, and more importantly he also knew and relished the journey to take. What I am sure of is that you will hear the countless stories of how Ian helped, lead, guided, encouraged, and was enthused by the progress of many, particularly lots of new Canadians. I used to laugh with Ian about his overt operations in making things happen – however, those close to him know the many covert operations helping many people irrespective of backgrounds. It was not just for me but many others where Ian simply went out of his way to help, guide and encourage – just look 26 | CONSTRUCTION ECONOMIST | www.ciqs.org | Spring 2022
at the countless heart driven tributes to him – from Canada and well beyond. Ian and I chatted a lot – from every aspect of building construction to business to our shared passion of our profession and always of course our favourite topic of food. Now that was fun!! Ian and I would meet to share stories over a meal – he loved a good curry, which he found even better duly washed down with a liquid refreshment! As foodies, COVID-19 did not stop us as we discussed where the new take-away had opened and where the best chip shops were. It was an easy conversation with Ian. He just knew what he liked. Every time I hired someone and we grew the business, I would call Ian knowing that he would be happy. Ian would characteristically mingle curiosity with encouragement as he nudged me forward and always gave my confidence much needed boost. For me, Ian simply had fabulous characteristics that would allow him to give honest opinions sometimes in a subtle manner. For example, the long conversations that we had about getting an electric car and thinking that an RV that could be the route (excuse the pun) to happy retirements, which resulted in us both searching internet to see what RV inventory was available. For me, personally, Ian was a shrewd person with a streetwise streak, a funny man with a wicked sense of humour, caring and compassionate. He always spoke glowingly of his family. Tyra, Alexander and Natasha – you were a phenomenal and THE most important cornerstone for Ian. I am grateful for my friendship with Ian – it is for me, a treasure. Also, to the many other friends, professional acquaintances, many leaders that he developed and cherished – we learned so much from Ian. His fabulous legacy is for us to build on. I miss you, my friend Ian, and thank you so much.
Tribute to Ian by David Lai PQS(F) 16 years ago, I met Ian at one of our Greater Toronto Area (GTA) CIQS Chapter Annual General Meeting. From that moment, I could see that here was a person that was dedicated to doing good, helping newcomers especially those from overseas into our association and at the same time someone who loved to enjoy life. Our meeting turned into a deep bond of friendship over the years. Ian and I went on from serving on the local GTA chapter to serving on the provincial body (Ontario Institute of Quantity Surveyors – OIQS), serving on the national body (CIQS), to representing Canada internationally on the Pacific Association of Quantity Surveyors. Ian also represented Canada on the International Cost Engineering Council (ICEC). Ian served as member of the Executive Council of the GTA Chapter, President of The GTA Chapter, member of the Executive Council of OIQS, President of OIQS, member of the national CIQS Council, president of the CIQS, member of the PAQS Executive Committee, and President of PAQS. The time that Ian spent serving on these boards was his personal time, he would volunteer his vacation time to attend these meetings locally, nationally as well as internationally. Ian made a huge impact on the success of the CIQS and I can recall that back in 2005 there were only 167 student members in Ontario. As president of OIQS, he made a concerted effort to visit colleges to attract more student members. Within three years our student members increased to 373 members which was a 220% increase over the number we had in 2005. Ian and I worked on several initiatives, one of which was the accreditation of the Colleges in Ontario. The previous accreditation was done in 2006 and only about six colleges were reviewed then. In 2014 we were able to release our new accreditation report that reviewed 20 college/university programs in Ontario. Both Ian and I carried this momentum into the national level and under his guidance we were able to start accrediting other colleges across Canada. We now have fully accredited colleges in BC, Alberta, Manitoba, Quebec, with other partially accredited colleges in the Maritimes. Through his love for his profession, Ian travelled to various cities across Ontario and Canada where he had a significant
impact on the local members. His dedication did not stop there, Ian was able to attend the first overseas CIQS AGM which was in Nassau, Bahamas where he developed a good friendship with the local CIQS members in Nassau. The same happened when we went to Jamaica for our second overseas AGM as well as our third overseas AGM in Nassau. Internationally, Ian represented CIQS at the PAQS Conventions in Kuala Lumpur Malaysia, Singapore, Hong Kong, Sydney Australia, Christchurch New Zealand, Brunei, Yokohama Japan, Xi’an China. He was well respected by everyone from these countries and from the number of tributes that came from these countries it was obvious that he made many friends. For me I will surely miss the good times we had in these foreign places – walking to the shopping mall in Kuala Lumpur to dining at the One Degree Marina on Sentosa Island; going up the Sky High Infinity Pool at Marina Bay Singapore, to walking around the Opera House in Sydney Australia; going up to Victoria Look-out Point in Hong Kong to going to the Terracotta Warriors Tomb in Xi’an; walking on the Great Wall of China in Beijing to having a local beer (the cost of beer was much cheaper than tea) for breakfast on the Bund in Shanghai. However, none of these adventures with Ian showed his best attributes. Ian was so proud of his nickname Poison Dwarf. I asked Ian why he had that nickname and he explained that many times when he saw injustice he would intervene and get things sorted out fairly. He hated to see injustice done and he would offer help everywhere he went – from the islands in the Caribbean to across Canada to many places in PAQS countries. One of the lasting memories that I have of Ian was one night we were walking back to the hotel in Vancouver after dinner and we happen to pass a homeless lady sitting on the sidewalk begging. Without hesitation, Ian took out his wallet and shoved $40 into her hands. I asked Ian why he gave her so much money. His reply was She needs to eat too. At that moment I was lost for words, so we silently walked back to the hotel to have a night cap before going to bed. This is the friend that I had, this is the friend that I lost, this is a friend that I will always remember, this was my brother. Spring 2022 | www.ciqs.org | CONSTRUCTION ECONOMIST | 27
Tribute to Ian by Mark Russell PQS(F) The text messages from David Lai last week made for sobering reading, but nothing could have prepared me for the email that David sent in the early hours of Boxing Day to say that Ian had passed away. Then the emails started coming in; from Hong Kong, Malaysia, New Zealand, Finland, England, and Sri Lanka, displaying the far-reaching impact of this sad news and the ripples that it had beyond these shores. Ian was quite something and the responses to this CIQS post are testimony to that. Not only was he a giant of the profession, he was also a champion of CIQS, a mentor to many fledgling QS', and a staunch advocate for QS's new to the country. My initial introduction to Ian was at the CIQS AGM in the Bahamas in 2006. Little did I know then that the next 10 or so years would take us both to Jamaica, China, Japan, and New Zealand as he progressed from CIQS Council Member to CIQS President to Chair of PAQS. On CIQS Council, Ian was a shrewd operator, mischievous, a formidable ally, and quite the politician (even if he could start a fight in an empty house – which he often liked to do) but the respect and affection he had for the likes of Lois Metcalfe, David Lai, Roy Lewis, Mark Gardin, Jeff Logan, and Dave Burns was clearly evident – and he put in the hard yards. He was involved in the Ontario Board, visiting and speaking at post-secondary institutes, generating and signing reciprocity agreements with other QS organizations and
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countries, and participating at the old OIQS town halls. CIQS Council meetings would end on a Sunday and he would insist on driving us to Pearson instead of letting us take a cab. These qualities transferred seamlessly to his time as PAQS Chair where he brought them to an international audience, managing protocols and strategies with ease. As serious as he was on official CIQS and PAQS duties, this flew in the face of what he was like in social situations. This is where he was truly in his element – gregarious, engaging, and thoroughly great company. He loved regaling us with tales of his many years as a QS in the Caribbean. A great memory of Ian was in Xi'an, where he had arranged a cab to take us to the terracotta warriors – the cabbie zigzagging through insane traffic to get us there, playing Mendelssohn's "The Wedding March" at maximum volume. I last saw him was in 2019 when I flew to Toronto for a few days on business. Heading to site one day I looked at this particular village sign and thought "I think this is where Duncan lives." As sure as guns it was, and 15 minutes later we were having lunch in one of the local pubs. He insisted on me surprising Tyra and showing us his recently built house, so we headed up to give her a shock and for them to give us a tour of their spectacular place. Which leads to Tyra. As much as we will miss him, she will miss him the most. He was a rascal, but he was her rascal and that is where my thoughts are today.
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Vaccine and pandemic mandates take centre stage as the CIQS begins to ramp up advocacy for 2022
W
hen parliament re-convened for the opening of the new winter session on January 31, 2022, it continued to sit as a hybrid sitting, with some members in Ottawa and many participating virtually. What they had not anticipated when they returned, was a large protest shutting down much of the downtown core including the parliamentary precinct. (This edition of Construction Economist will be published a few weeks after the major efforts to end the blockades and protests began.) The blockade of Canada’s capital became a major national and international news story, as it stretched into its third week. The protests began with a convoy of truck drivers against the federal mandate requiring transport truck drivers be fully vaccinated against COVID-19 to be eligible to cross the Canada-US border without quarantine. The group initially arrived in Ottawa on January 28, 2022 and began to blockade much of the downtown core. The intent of the protests seemed to expand from not just the truck driver mandate, but all government mandates related to COVID-19. The protests also grew to include critical infrastructure locations including some very important border crossings – including Coutts, AB, Emerson, MB, and the Ambassador Bridge between Windsor, ON and Detroit, MI (the busiest border crossing in Canada). It is estimated that over $300 million dollars a day in border trade moves across that bridge, which remained closed for six days until a police operation ended it. The Ottawa Protest extended beyond three weeks. There were municipal and provincial court injunctions in attempts to end the protest and blockades of the city; however, with little success to bring these to an end, for the first in Canadian history, the Federal invoked the 1988 Emergency Measures Act. This further extended both government and police abilities to enforce injunctions, and provided other key options. On February 18, 2022, the joint police force operation moved in and began breaking up the blockades in downtown and
clearing out vehicles. Parliament was scheduled to continue its debate on the Emergency Measures Act; however, due to the police operation, the session had to be suspended for safety reasons. While the protests did not directly impact CIQS advocacy efforts in 2022, it did have impact upon how parliament functioned. The shutdown of the downtown core is something that will continue to be monitored and the border blockades certainly had a major shortterm impact on trade. While the February inflation numbers are not available at the time of writing, the January inflation numbers are concerning: Statistics Canada reported January inflation at 5.1%. This will be important to monitor for how it could affect construction costs going forward in 2022. As part of the advocacy efforts and engagement with the federal government, the CIQS submitted its pre-budget submission to the Standing Committee on Finance, as well as to the department of finance. While the Finance Committee continued its study, the CIQS goal is for three key recommendations to be included in the report that will be submitted to the minister of finance for consideration in the upcoming federal budget. While the date of the budget is not presently known, and the ongoing pandemic and protests could delay the release of the budget, it is expected to occur sometime in the spring. Those recommendations are:
1. The CIQS strongly advises that the federal government bring forward, to earlier years, funding committed by the investing in Canada Plan in all project streams to stimulate the economy and provide customers for Canada’s construction sector. 2. The CIQS also recommends the federal government commits to studying the potential benefits of ensuring Professional Quantity Surveyors are involved in all federal projects to provide cost assurance and best value to taxpayers in the context of historic infrastructure investments. 3. The CIQS urges the federal government to extend the Green Infrastructure Fund through additional investments to stimulate the economy with future forward projects beyond 2021-2022. The CIQS kicked off 2022 with a productive meeting with the Director of Policy to the Honourable Dominic Leblanc, Minister of Intergovernmental Affairs, Infrastructure, and Communities. The CIQS shared the key priorities outlined in the pre-budget recommendations and, while they did not obtain a firm commitment on immediately implementing these, the discussion was very positive. To build upon those conversations, the CIQS made introductions to key officials at the department of infrastructure, as well as the infrastructure bank, to help build further relationships. To continue building upon the advocacy strategy, the CIQS is continuing to expand relationships with its parliamentary
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Spring 2022 | www.ciqs.org | CONSTRUCTION ECONOMIST | 29
partners, including other key Ministers such as the Minister of Indigenous services, Public Services and Procurement, and National Defence, among other key decision makers. It is also very important to build relationships across party lines, so we will be meeting with the shadow ministers and opposition critics of Canada’s other political parties. We will also be engaging with Members of the Standing Committee on Transport, Infrastructure and Communities, advocating to them the key recommendations and why CIQS members can play such a critical role in major infrastructure projects.
As Canada and the world begin to recover from the pandemic, economic stimulus will be critical to kick-starting the Canadian economy, which has continued to falter. As the CIQS has recommended to key government officials, investing in infrastructure stimulus is needed both to upgrade much of Canada’s aging infrastructure and as a critical way to help stimulate economic growth as Canada turns the corner from the pandemic. CIQS members’ contributions to Canada infrastructure projects will ensure they are on time, on budget, and in the interest of all Canadians.
About the author As the Senior Consultant at Impact Public Affairs, Ben Howe works with a variety of associations at the federal level. This includes working with the Canadian Institute of Quantity Surveyors, advocating that the federal government accelerate infrastructure investments and implement broad involvement of quantity surveyors in infrastructure projects.
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