April 2015 co web

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A publication of the Utility Contractors’ Association of New England, Inc.

APRIL, 2015

assDEP, MWRA & BWSC Mass gency Heads eads Discuss iscuss Agency lanned Future uture Work ork Planned

• Governor Baker Signs Executive Order Initiating Regulatory Reform Review • Truck Side Guard Ordinance • Randolph Votes to Seek Funding for New Water Treatment Plant


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IN THIS ISSUE

OFFICERS President TONY BORRELLI Celco Construction Corp. President Elect JOHN OUR Robert B. Our Co., Inc. Treasurer PAUL SCENNA Albanese D&S, Inc. Secretary RICHARD PACELLA, JR. R. M. Pacella Inc.

BOARD OF DIRECTORS MARCELLA ALBANESE Albanese Bros., Inc. VINCENT BARLETTA Barletta Heavy Division NICK BIELLO J. D’Amico, Inc. KEVIN COLE J. F. White Contracting Co. STEPHEN J. CONNOLLY ATS Equipment, Inc. MAUREEN DAGLE Dagle Electrical Const., Corp. THOMAS DESCOTEAUX R. H. White Const. Co., Inc. ALEX DUNN Travelers GREG FEENEY Feeney Bros. Excavation, LLC JERRY GAGLIARDUCCI Gagliarducci Construction, Inc. PHIL JASSET Honorary Board Member AL MORTEO FED. CORP. JOSEPH PACELLA RJV Construction Corp. BRIAN RAWSTON Jay Cashman, Inc. KENNETH STEVENS A. H. Harris & Sons, Inc. PAUL UMBRO, JR. Umbro & Sons Construction Corp. CHRIS VALENTI GVC Construction, Inc. DAVID ZOPPO R. Zoppo Corp. ANNE KLAYMAN Executive Director

3 President’s Message:

UCANE’s Forecast Meeting Kicks Off the 2015 Construction Season

7 Legislative Update:

• Legislative Delay: What are the “Joint Rules”? • House Passes $200 Million Road Improvement; House and Senate Pass Differing Supplemental Budgets • Randolph Votes to Seek Funding for New Water Treatment Plant • Items for Quick Consideration

15 Governor Baker Signs Executive Order Initiating Regulatory Reform Review 16 UCANE’s March Dinner Meeting: MassDEP, MWRA, and BWSC Agency Heads Discuss Planned Future Work

21 MWRA FY15-FY17 Upcoming and Ongoing Construction Awards 29 BWSC Capital Improvement Program 2015-2017 Executive Summary and Upcoming Projects 39 In Memoriam: Charles Button 41 Legal Corner:

Civilian Board of Contract Appeals Allows Contractor to Stop Work on Troubled VA Project

47 Safety Corner:

OSHA Updating Eye & Face Protection Standards in Construction

48 Massachusetts LLS Presents “Champions of Hope Gala” 49 Spotlight on Cape Cod: Cape Water Quality Plan Given to State

52 57 58 59 63

UCANE’s Fourth Annual Trade Show Kleinfelder’s John Struzziery Named Top 25 Newsmaker Save the Date...UCANE’s 36th Annual Golf Classic Truck Side Guard Ordinance Financial Management: • Are Tax Refunds Good or Bad? • Seeking Safety in Long-Term Treasuries • Private Health Insurance Exchanges for Business Owners

Editor: Anne Klayman, Associate Editor: Suzanne Savage, Graphic Designer: Sherri Klayman Construction Outlook Chairman: Tony Borrelli Editorial Board: Tony Borrelli, John Our, Paul Scenna, and Richard Pacella, Jr. CONSTRUCTION OUTLOOK published monthly by the Utility Contractors’ Association of New England, Inc., 300 Congress Street, Suite 101, Quincy, MA 02169; Tel: 617.471.9955; Fax: 617.471.8939; E-mail: aklayman@ucane.com; Website: www.ucane.com. Statements of fact and opinion are those of the authors alone and not necessarily those of UCANE and the Construction Outlook editorial board and staff. Subscriptions are included in dues payments for UCANE members. Presorted Standard postage paid at Abington, MA. POSTMASTER, please send form #3579 to Construction Outlook, Crown Colony Office Park, 300 Congress Street, Suite 101, Quincy, MA 02169.

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UCANE’s Forecast Meeting Kicks Off the 2015 Construction Season One of the most anticipated dinner meetings of the year has always been UCANE’s Annual Forecast Meeting and Trade Show. And last month’s event lived up to all my expectations for member attendance and participation, and valuable underground utility construction information. As has been the case for the last few years, 35 Associate member companies, a record number and growing each year, had the opportunity to showcase their products and services to a receptive audience of contractors and their key management personnel. Everyone seemed to be in a great mood and I noticed many of our contractors working their way through an overflowing crowd to view our Associate member’s exhibits in order to get information on some products and services they’ll need for the upcoming season. I’ve been told there were many business transactions finalized at the show, which is good for all concerned.

F

ollowing the social hour and trade show, approximately 300 members and guests were served a sumptuous Four Points Sheraton Hotel dinner, after which the Forecast presentation by the heads of the MassDEP, MWRA, and BWSC completed a perfect evening. For those members who could not attend, it needs to be told that the agency heads in attendance, and their top management personnel, go out of their way every year to provide UCANE with the most up-to-date information on current funding, projects coming out to bid, and mid to long term projections. Equally impressive were their video presentations, which are approaching Hollywood standards with graphs, charts, and collages of on-going projects, with an injection of humor that was just right and had us all paying close attention. Maybe next year we’ll consider giving out a UCANE “Emmy” for the most creative presentation. APRIL, 2015

In addition, there were some prospective members in the audience as well as members of the Boston Society of Civil Engineers Board of Directors. BSCES and UCANE hope to work together on issues of mutual concern in the months ahead. This Forecast meeting brings together owners, engineers, and contractors, all in the same room, and all on the same page when it comes to trying to take care of our neglected underground infrastructure. Who said it couldn’t be done! As this magazine reaches you, I hope that everyone’s excavators are busy and the work of restoring and upgrading our clean water and drinking water systems is well underway. It was a long cold winter, but bids are starting to show up and early 2015 spending levels are encouraging. Despite a huge deficit to deal with in his continued on page 5

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President’s Message continued from page 3 first budget, Governor Baker spared water and sewer programs from FY16 budget cuts placed on many other state programs and agencies. Hopefully the legislature will also see the wisdom of not going backwards on the fight to maintain our underground infrastructure. While roads, bridges, and potholes are talked about on every news station these days, many average citizens forget the potential problems that exist with 100-year-old pipelines buried beneath the potholes. UCANE will continue to push for public awareness and common sense which dictates that municipal owners should be replacing antiquated underground pipes as the first step of any road improvement project. On another note, while our crews are busy putting pipe in the ground, the UCANE staff and our Legislative Director Mark Molloy will be wading through the 5,100 pieces of legislation that our elected Senators and Representatives filed or refiled in January. Apparently there were not enough declared “snow emergencies” to slow down the huge filings of potential new laws. Mark’s early estimate is that about 200 pieces of legislation could

have an impact on our members’ businesses. At press time the House and Senate were at odds over Joint Committee rules and the session is behind schedule with many Bills still not available in print or forwarded to committees. From many perspectives, going a little slower is probably a good thing. As new Bills work their way through the state house, UCANE will be looking out for your interest. There may be occasions when we need to visit a legislator to explain our position on a Bill, and there is nobody better to do this and to make an impression than a contractor or supplier who owns his own business and employs constituents. Please try to make yourself available if you are called upon to help your industry and your own business.

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A

Legislative Delay: What are the “Joint Rules”?

members / three Senators) to negotiate a solution to this t this point in a legislative session, committees disagreement. Why is this relevant? Until the House and typically begin holding hearings on the over Senate agree to the Joint Rules, the Joint Committees 5,300 bills filed before them. This year is a little do not officially exist. So while the House Clerk has desdifferent, but for an interesting reason. In short, the Masignated bill numbers and forwarded House legislation sachusetts House of Representatives and the Massato the respective committees, the Senate Clerk has not chusetts Senate cannot agree on the “Joint Rules’ that out of due deference to the pending negotiations. If the govern the shared committee process. In simplified House and Senate cannot agree to Joint Rules, then the form, the Joint Rules essentially outline how the joint or Senate will return to its Rules debate and create Sen“shared” committees of the legislature will operate; how ate Committees to handle the various pieces of Senate legislation will be referred to these committees and, legislation. upon an action being taken by the Joint Committee, what will then happen to a piece of legislation. In sum, the usual activity of committee hearings has been delayed by a month or so. Expect the issue The Massachusetts House of Representatives to be resolved one way or another by May; legislators passed its version of the Joint Rules in a fairly stanrecognize that 5,300 pieces of legislation is a lot to dard form with few, if any changes, from the previwork through in any legislative session. ous session. The Massachusetts Senate, in passing its version of the Joint Rules, however, requested a continued on page 9 change that highlighted a unique feature of the Joint Committee system. Traditionally, there are more MBO Precast Inc. House members on a Joint Com4 Marion Drive • Carver, MA 02330 mittee than Senate members. As T: 508-866-6900 • F: 508-866-5252 the committees operate on a demowww.MBOPrecast.com cratic process (i.e., majority vote, unless otherwise agreed upon), the House members can simply outvote Stone Strong Retaining Wall Systems their Senate counterparts from a Manholes / Catch Basins / Custom Structures position of numerical superiority. As Septic Tanks / Leaching Products a result, the Massachusetts Senate has requested that the Joint Rules be amended to allow for Senate bills to be advanced to the Senate by a vote of a majority of Senators. Given the differences between the two versions of the Joint Rules, the House and Senate have appointed a conference committee (three House

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Legislative Update continued from page 7

House Passes $200 Million Road Improvement; House and Senate Pass Differing Supplemental Budgets

N

otwithstanding the aforementioned disagreement over the Joint Rules, the House and Senate were able to advance largely similar supplemental budget appropriations. While the House supplemental budget authorization was approximately $347 million, the Senate passed a $361 million spending bill. The budget, which will provide additional funding for the accounts involving public employees' health insurance, family social workers, and the state's snow-and-ice removal, also includes a couple key policy differences. In particular, the differing policy proposals include whether to allow the University of Massachusetts campuses to keep the tuition they collect from students and whether to change amount slot machine players must win before being required to take a timeout and pay taxes to the IRS. The version that cleared the Senate Committee on Ways and Means did not include provisions added by the House to re-

APRIL, 2015

authorize a statewide grand jury and to increase the amount of money slots players would be able to take home before immediately reporting their winnings. (Note: the Senate added language reinstituting statewide grand juries during debate on the matter.). A conference committee of three House and three Senate members will now try to iron out any remaining differences in an effort to move the appropriation to the Governor’s Office. At the same time, the House unanimously authorized $200 million in borrowing to fund local road and bridge repairs as part of the Chapter 90 program. The passing of the local road and bridge funding is an annual rite of passage that is timed to align with the start of the Spring construction season so that cities and towns will know what they can expect for funding such initiatives. The Massachusetts Senate is expected to take the legislation up shortly. continued on page 11

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Legislative Update continued from page 9

A

Randolph Votes to Seek Funding for New Water Treatment Plant

ccording to the Randolph Enterprise, resumed in earnest in 2008. Town Council Randolph Town Council members voted members recently voted to establish a savings to recommend that the Tri-Town Board account in anticipation of new plant construcof Water Commissioners seek funding for contion. The Town of Randolph has spent roughly struction of a single water treatment plant to $500,000 for emergency repairs during the last serve Randolph, Braintree, and Holbrook at an three years to maintain its current system. continued on page 13 estimated cost of $43.5 million. The alternative was to purchase water from the Massachusetts Water Resources Authority at a cost of $12.5 Aon Risk Solutions million to "buy in" to the system. Construction Services Group In the overall assessment that led to the rejection of the MWRA opportunity, Randolph Town Council members were concerned that attaching into the MWRA system would be cost-prohibitive over the long As the leading provider of risk solutions to the construction industry, Aon run. Not only would MWRA Construction Services Group partners with clients to provide insighful membership cost more in the analysis, strategic direction and creative solutions backed by our dedicated long run, council members arteam of construction experts and the strength of Aon’s global network. gued, but the town would lose control over its water distribution Let Aon Construction Services Group empower your growth, profit and continuity. system. In addition to the $12.5 aon.com/construction million the town would pay the Kevin White, CEO Brian Driscoll, Managing Director Paul Healy, National Contract Surety MWRA to buy-in to the system, 617.457.7717 617.457.7668 617.457.7719 spread over 25 years, Randolph Kevin.White@aon.com brian.driscoll@aon.com paul.healy@aon.com would pay a yearly service rate Mark Herendeen, Surety Michael Scott, Insurance Mark Toglia, Wrap-Up of $501,000. The rate would be 617.457.7715 617.457.7699 617.457.7727 mark.herendeen@aon.com mark.toglia@aon.com $570,000 if the town accepted the utility's offer of a three-year "grace period”. Under the approved plan, the Town of Randolph would pay an estimated $15.8 million as its share of the $43.5 million cost of building a single water treatment plant through a 10-year bond. At present, there are two water treatment plants – one in Braintree, and one in Randolph on Pond Street, which serves Randolph and Holbrook. While officials have disRisk. Reinsurance. Human Resources. cussed replacing the facility for nearly two decades, talks

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Legislative Update continued from page 11

Items for Quick Consideration • According to the Reading Patch, the Reading Board of Selectmen approved new water, sewer, and storm water rates that will go into effect with the December 2015 billing cycle. Selectmen also voted to eliminate a 10 percent early payment discount which could only be offered by raising the rates 10 percent for all users. Water and sewer rates increased by 2.9 percent, but with the overall 10 percent reduction, rates will effectively decrease by a net 7.1 percent. The new rates are as follows: (a) Water lowered from $9.45 to $8.83 per 100 cubic feet (6.6 percent decrease); (b) Sewer - lowered from $10.56 to $9.76 per 100 cubic feet (7.6 percent decrease); and (c) Storm water - fee remains unchanged at $40 per single-family household per year. • According to the Cambridge Chronicle, Cambridge residents will see an increase in water and sewer bills starting April 1, following the City Council’s approval March 16 of a 4.9-percent water and sewer rate hike. The average single-family home in Cambridge will see their annual water and sewer bills rise from about $730 to $766, a $36 increase. The average two-family home will see an increase from $1,020 to $1,070, or $50, and three-family homes will see an average increase from $1,480 to $1,553, or $70, according to the city’s financial projections. While the city has managed to maintain a 0-percent increase in water rates over the last five years, this year’s Massachusetts Water Resource Authority (MWRA)’s assessment spurred a 6.8-percent spike in the city’s sewer use rate, resulting in a 4.9-percent hike in the water and sewer rate. • UCANE continues to work with its water infrastructure allies to see appointment of the Water Infrastructure Advisory Council and the Commonwealth Underground Utility Coordination Commission occur in accordance with Chapter 259 of the Acts of 2014. These two entities will continue to advance the strong foundation established by last session’s long overdue water infrastructure legislation. • The Baker-Polito Administration’s “hold” on promulgating new regulations ended on March 31, 2015. It remains to be seen whether the Administration will put in place new standards for regulatory oversight or let the priorities of the January memorandum that instituted the “halt” continue to govern. • New Stage 1 Vapor Recovery Forms and Guidance are Available from the Massachusetts Department of Environmental Protection. Effective January 2, 2015, amendments to MassDEP Air Pollution Control Regulations at 310 CMR 7.00 and 310 CMR 7.24 require the removal of Stage II vapor recovery systems and enhancements to Stage I vapor recovery equipment at gasoline dis-

APRIL, 2015

pensing facilities (GDFs) across Massachusetts. The new regulations reflect the fact that between improved Stage I system technology and the widespread adoption of vehicle on-board vapor recovery, Stage II systems are no longer needed. Under the new program requirements, basic operation of Stage I and Stage II systems will not fundamentally change and GDFs will continue to run their vapor recovery equipment for the most part as they did before the regulations were amended, but facilities must properly decommission existing Stage II systems within two years and phase-in the use of California Air Resource Board Enhanced Vapor Recovery (CARB EVR) Stage I systems or EVR components within seven years. For more information about these regulations, please visit: http://www.mass.gov/eea/agencies/massdep/air/ programs/stage-ii-vapor-recovery.html • Reminder for companies bidding work in the City of Boston. As of May 5, 2015, the City of Boston’s “side guard” ordinance will be in effect for all new contracts with the City of Boston. For more information, please visit: http://www.cityofboston.gov/isd/weightsandmeasures/sideguards/ (See article on page 59.) n

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Governor Baker Signs Executive Order Initiating Regulatory Reform Review Year-Long Review to Reduce Burdensome Regulations to Increase Efficiency and Competitiveness

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n March 31 Governor Charlie Baker signed an executive order immediately initiating a comprehensive review process for all regulations enforced by the Executive Department and leaving in place the regulatory pause announced by the administration earlier this year. “State government must speak with one voice in its commitment to providing exceptional customer service for citizens, municipalities, businesses, nonprofit groups, healthcare providers and educational institutions,” said Governor Baker.“This will be an intensive process that ultimately makes Massachusetts a more efficient and competitive place to live and work, while driving economic growth. I encourage all other areas of state government to put in place a similar process.” Executive Branch agencies will be charged with ensuring each regulation is clear and concise and that any newly proposed regulations are measured for their potential impact on businesses of all sizes or other entities, including municipalities and non-profits. Agencies will submit regulatory proposals and impact statements to their secretariat before review by the Secretary of Administration and Finance who will establish a process for encouraging public input, standards and schedules. The business and competitiveness impact statements will also be made available on the Commonwealth’s website. The Secretary of Administration and Finance may also provide for waivers or exceptions to regulations essential to public health, safety, environment or welfare. “Making Massachusetts a better place for job creation and business development will require conducting a thorough review of our onerous regulatory environment,” said Kristen Lepore, Secretary of Administration and Finance. “I look forward to working with my fellow secretariats and all stakeholders to establish a careful and complete regulatory review process. We will ensure that all regulations administered by the Executive Department benefit the Commonwealth without undue burdens or costs and serve a legitimate purpose in making Massachusetts a safe, healthy, and effective place to do business.” Only those regulations which are mandated by law or essential to the health, safety, environment,

APRIL, 2015

or welfare of the Commonwealth’s residents shall be retained or modified. In order to find that a regulation meets this standard, the government agency conducting the review must demonstrate that: there is a clearly identified need for governmental intervention that is best addressed by the agency and not another agency or governmental body; the costs of the regulation do not exceed the benefits; the regulation does not exceed federal requirements or duplicate local requirements; there are not any less intrusive or restrictive alternatives; the regulation does not unduly and adversely affect Massachusetts citizens and customSHORING & SAFETY ers of the Commonwealth, or the competitive environment in Massachusetts; there is a formal process in place for measuring the effectiveness of the regulation; and, the regulation is time-limited or provides for regular review. n

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UCANE’s March Dinner Meeting

MassDEP, MWRA, and BWSC Agency Heads Discuss Planned Future Work

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Martin Suuberg

Fred Laskey

John Sullivan, P.E.

MassDEP Commissioner

MWRA Executive Director

BWSC Chief Engineer and Operations Officer

U

CANE’s 2015 Forecast Dinner Meeting and Trade Show, sponsored by Allied Recycling Center, Inc., held at the Sheraton Four Points Hotel in Norwood, MA was attended by close to 300 members and guests, including many key staff members from the Department of Environmental Protection (MassDEP), Massachusetts Water Resources Authority (MWRA), and Boston Water & Sewer Commission (BWSC). Board members from the Boston Society of Civil Engineers (BSCES), and prospective members from J. F. McDermott Corp. of Whitman, MA, Total Project Logistics of Quebec, Canada, and Bank of America were also in attendance. Presenters for the evening included newly appointed MassDEP Commissioner Martin Suuberg, MWRA Executive Director Fred Laskey, and BWSC Chief Engineer John Sullivan, each of whom know the state’s water and sewer problems, literally from the “ground up”. They provided the latest status of ongoing underground infrastructure construction projects and their forecast for projects coming out to bid later this year. UCANE President Tony Borrelli (Celco Construction Corp.) opened the meeting by introducing Martin Suuberg who gave an overview of the MassDEP CY15 clean water and drinking water IUP lists which showed SRF projects totaling $506.8 million, with $106.5 million for drinking water projects and approximately $400.3 million for clean water projects. (MassDEP CY15 SRF project lists can be found in the January 2015 issue of Construction Outlook on-line at www.ucane.com.) Fred Laskey then updated our members and guests on the 2015 MWRA projects coming out to bid, and discussed the importance of the State Revolving Loan Fund Program (SRF) in financing these construction projects. (See page 21 for the project list.) John Sullivan gave an overview of the BWSC 20152017 Capital Improvement Program (CIP) and a detailed review of upcoming projects expected to be out for bid over the next two years. (See page 29 for project list.)

APRIL, 2015

Commissoner Suuberg, while only in his position for a few months, made it perfectly clear that he and his staff are available to work with UCANE to openly discuss issues and concerns. He went on to say that answers to contractor’s inquiries would be forthcoming in days, and not months. Regulations and permitting issues, that sometimes were unnecessarily delaying projects, would be reviewed on a priority basis and swift decisions would be forthcoming. He also suggested improving MassDEP operations by doing permitting online. The Commissioner expressed his intent to improve communications by working closely with all concerned, from municipalities to legislators and contractors. He reiterated his support of the SRF Program, and pledged to look for opportunities to strengthen relationships with our industry. Sustained levels of underground water and sewer utility construction in the foreseeable future, was the general consensus of the three keynote speakers. Generally, their messages were that the need for clean drinking water and wastewater pipeline and treatment facilities, will continue to grow to meet the needs of our citizens, as well as to build the foundation to allow businesses to expand, create jobs, and spur the state’s economic growth throughout this century. The environmental problems our state faces and the subsequent cost to remedy these problems, some of which we know, and others that we are just starting to learn about, will pose a tremendous financial challenge on this and future generations but, it is a challenge that must be met if Massachusetts is to compete in the world economy. Concern was also voiced about the lack of public understanding of the complexities involved in developing, and then constructing, a viable, efficient, and reliable drinking water and wastewater underground infrastructure network. Both Fred Laskey and John Sullivan spent time showing their agency’s efforts to assure system redundancy, thwart potential terrorist threats, reduce power continued on page19

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Dinner Meeting continued from page 17 consumption levels at some of their pump stations and treatment plants, and address climate change and weather issues, which could interrupt the operations of many pumping stations and treatment facilities that are located near the coast or in flood areas. All speakers expressed their concern for these issues and detailed some of their system improvements, including water quality monitoring and testing, high water level indicators, and intrusion alarms. While those attending fully understood the importance of the SRF Program as the engine that drives our state’s water and sewer construction program, the speakers made a point of reminding the attendees that many in the public sector are still not fully aware, or even familiar, with the benefits derived from one of the most successful government funded programs ever enacted. The emphasis in this year’s forecast was for each agency to work closely with municipalities to ensure that the available SRF program funding was fully utilized. The need to continue to inform the public and our elected officials about the success of the SRF program was noted as being essential if the program is to effectively compete for lim-

ited infrastructure resources with other equally important environmental, above ground infrastructure (road and bridge), and social programs. However, it was noted that the underground water and sewer industry’s issues are somewhat unique and different from other programs. The fact that most of the excellent work being performed by these agencies and our members is “out of sight and out of mind” creates its own problem. Couple this with the public’s expectation that clean drinking water will always be available when they turn on their faucet only exacerbates this perception. Access to clean drinking water is a “right” and must be dealt with at every opportunity through public education and our discussions with key business and government leaders. Our speakers made it clear that UCANE’s effort to get our industry’s message out was an essential element to addressing the state’s huge backlog of water and sewer projects. That being said, the MassDEP, MWRA, and BWSC’s forecast for ongoing and upcoming underground utility construction work was very positive.

We at UCANE want to thank our speakers for taking the time out of their busy schedules to join us and for their informative presentations. We would also like to thank our Construction Outlook advertisers who participated in our Fourth Annual Trade Show prior to the meeting. It was another huge success! (Article on page 52.) n

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Massachusetts Water Resources Authority Upcoming Construction Awards

FY15–FY17 Upcoming Construction Awards Estimated Est. Project Phase Anticipated Contract Contract Advertisement Amount Notice to Amount ($000) Project Phase Proceed ($000s) FY15 Anticipated Awards DI Treatment Plant Asset Protection Clinton Wastewater Treatment Plant Facility Asset Protection Facility Asset Protection DI Treatment Plant Asset Protection DI Treatment Plant Asset Protection

Gravity Thickener Rehabilitation Clinton Roofing Rehabilitation Chelsea Screenhouse Upgrades Alewife Brook Pump Station Rehabilitation Construction Barge Berth and Facility Replacement Winthrop Terminal Facility VFD Replacement - Construction

FY16 Anticipated Awards Carroll Water Treatment Plant NIH Redundancy & Storage DI Treatment Plant Asset Protection DI Treatment Plant Asset Protection Long Term Redundancy Facility Asset Protection Central Monitoring System Facility Asset Protection Facility Asset Protection Carroll Water Treatment Plant Waterworks Facility Asset Protection Sudbury/Weston Aqueduct Repairs Sudbury/Weston Aqueduct Repairs Clinton Wastewater Treatment Plant DI Treatment Plant Asset Protection

Existing Facilities Modifications - Southborough Lab Roof Section 89/29 Redundancy Construction Phase 1B Fuel System Modifications Digester Sludge Pump Replacement Phase 2 Wachusett Aqueduct Pump Station Construction Prison Point Piping Rehabilitation Quabbin Power Communications & Security Caruso Pump Station Improvements - Construction Chelsea Creek Upgrade Construction Modifications - Interim Corrosion Control Facility Beacon Street Line Repair Weston Aqueduct Flow Control Valve Rosemary Brook Building Repair Phosphorus Reduction Construction Expansion Joint Repair - Construction 3

FY17 Anticipated Awards Facility Asset Protection Carroll Water Treatment Plant DI Treatment Plant Asset Protection MetroWest Tunnel NIH Redundancy & Storage SEH Redundancy & Storage Quabbin Transmission System Facility Asset Protection Waterworks Facility Asset Protection DI Treatment Plant Asset Protection NIH Redundancy & Storage Residuals Asset Protection Alternative Energy Initiatives DI Treatment Plant Asset Protection DI Treatment Plant Asset Protection Wastewater Meter System-Equipment Repl. DI Treatment Plant Asset Protection

Cottage Farm Construction 1 (PCB) Existing Facilities Modifications - Cosgrove Storage DI Dystor Membrane Replacements Shaft 5/5A Surface Piping Inspection/Restoration Construction Section 89/29 Redundancy Construction Phase 1C Redundant Pipeline Section 111 Phase 1 Construction Oakdale High Line Replacement Interceptor Renewal-Construction 1 Reading Extension Sewer Cosgrove Flat Roof Replacement HVAC Equipment Replacement - Construction Section 89 & 29 Redundancy Const. Phase 2 Residuals Facility Upgrade-Construction DI Wind Phase II Construction Fire Alarm System Replacement - Construction Clarifier Rehabilitation 2 Construction Construction Future Misc. VFD Replacements-Construction

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Jun-15 Jun-15 Jun-15 Jun-15 Jun-15 Jul-15

$5,786 $536 $3,609 $10,393 $1,000 $4,160

Jul-15 Aug-15 Aug-15 Aug-15 Sep-15 Oct-15 Oct-15 Dec-15 Dec-15 Dec-15 Jan-16 Jan-16 Jan-16 Feb-16 May-16

$2,392 $20,198 $4,300 $4,659 $60,500 $350 $2,800 $2,926 $54,816 $2,600 $1,000 $900 $1,562 $7,092 $1,930

Jul-16 $2,146 Jul-16 $520 Jul-16 $3,000 Jul-16 $1,280 Aug-16 $5,007 Aug-16 $29,819 Aug-16 $500 Sep-16 $3,640 Sep-16 $300 Oct-16 $17,101 Nov-16 $17,845 Jan-17 $10,000 Jan-17 $2,500 Feb-17 $16,000 Feb-17 $35,000 Apr-17 $2,000 May-17 $5,334 continued on page 23

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MWRA continued from page 21

Alewife Brook Pump Station Rehabilitat

MWRA Upcoming Contract Awards Wachusett Aqueduct Pump Station

Alewife Brook Pump Station

achusett Aqueduct Pump Station • Bid Date: Summer 2015 • •

Est. Contract Value: $60.5 million Emergency pump station will pump to Proceed: April 2water 014 from the Wachusett Aqueduct to the Carroll Treatment Plant ed Cost: $45.6 million • Provides redundancy for the Cosgrove Tunnel

An?cipated Adver?sement: November 2014 Rehabilitation Es?mated C ost: $9.3 million • Bid Date: Summer 2015

• Estimated Contract Value: $11 million

Upcoming Deer Island Construction Awards

Upcoming Deer Island Construction Awards 25

Upcoming Deer Island Construction Awards

Project

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Value ($000s)

Gravity Thickener Rehabilitation

Summer 2015

$5,786

Winthrop Terminal Facility VFD Replacement - Construction

Summer 2015

Barge Berth and Facility Replacement

Summer 2015

Fuel System Modifications

Summer 2015

Total Budget

• Total Budget: $720.9 million • FY14-18 Spending: $182 million • FY16 Spending: $45.2 million

Digester Sludge Pump Replacement Phase 2

Summer 2015

FY14-18 Spending: FY16 Spending:

Sodium Bisulfite and Hypochlorite Tanks Rehabilitation DI Dystor Membrane Replacements

March 2016 July 2016

$4,160

$720.9M $1,000 $4,300 $4,659

$182.0M $ 45.2M $6,581 $3,000

HVAC Equipment Replacement - Construction

October 2016

Fire Alarm System Replacement - Construction

February 2017

$16,000

Clarifier Rehabilitation 2 Construction

February 2017

$35,000

May 2017

$5,334

September 2017

$1,930

Future Misc. VFD Replacements-Construction Expansion Joint Repair - Construction 3

$17,101

52

continued on page 24

APRIL, 2015

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MWRA continued from page 23

MWRA Upcoming Contract Awards Northern Intermediate High Redundant Pipeline

Chelsea Creek Headworks Rehabilitation

• Bid Date: June 2015 • Est. Contract Value: $20 million Chelsea Creek Headworks Includes 7 miles of 48- and termediate • High Redundant Pipeline 36-inch pipeline

• Bid Date: September 2015 • Est. Contract Value: $55 million Rehabilitation • Rehab of other two headworks to be bid together near the completion for the Chelsea contract

Bid Date: September 2015 Estimated Contract Value: $55 million

e: $20 million

nd

Next at Clinton Treatment Plant: Phosphorous Removal 66

Southern Extra High Redundant Pipeline

Next at Clinton Treatment Plant: Phosphorous Removal

• Bid Date: June 2016 • Anticipated Advertisement: Rehab of other$30 twomillion headworks to be • Est. Contract Value: November 2015 bid5.4 together near the completion of Southern Extra High Redundant Pipeline • Includes miles of 36-inch • Estimated Cost: $7 million the Chelsea contract pipeline

Anticipated Advertisement: November 2015 Estimated Cost: $7 million 65 Bid Date: June 2016 Estimated Contract Value: $30 million Includes 5.4 miles of 36-inch pipeline

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e High, West Street Transmission . •

73% complete

MWRA Ongoing Projects Section 36, W11C and Shaft 9A11 – Arlington:

2,400 ft 36-inch pipeline in Reading RJV Construction Corporation Northern Intermediate High, Section 36, W11C and West St. Transmission Main: Shaft 9A11-Arlington: • First of 3P.redundancy projects on Section Caliacco Corp. RJV“W11C” Construction Corp. • New MWRA Pipeline Brunswick Ave and Hillsdale Road 89 to replace 10,500 feet of PCCP pipe • 73% complete • New MWRA Pipeline “W11C” •

• 2,400 ft 36-inch pipeline in Reading • Accelerated First of 3 redundancy projectsroadway on Section for MassDOT project 89 to replace 10,500 ft of PCCP pipe • Accelerated for MassDOT roadway project

Brunswick Ave. and Hillsdale Road

29

Clinton Wastewater Treatment Plant Rehab: R. H. White Construction Co., Inc. • Rehab of anaerobic digesters and

primaryRehab: clarifiers and installation of atment Plant new influent gates Co., Inc. • 54% complete

Gate Siphon and Floatables Contro Gate Siphon and Floatables P.Control Gioioso Sons, Inc. at & MWR 003: P. Gioioso & Sons, Inc.

• This theislast theof35 projects in thein the Long-T • is This theof last the 35 projects Long-Term Control Plan to move into construction construction • Construction is 53% complete, and all work is • Construction is 53% complete, and all 2015to milestone in Court Order work October is scheduled be complete by the October 2015 milestone in Court Order

of

continued on page 27

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This conduit is located beneath railroad tracks at South Station. The design of this project bega 2009 with an anticipated completion date in November 2014. A budget will be established in costs of this contract. The 2015 budget for this project is $225,000.

PROJECT CASH FLOW

Table 13 on page 63 illustrates the 2015-2017 cash flow projection for Increased Capacity projects Boston Water and Sewer Commission total $6,454,000 for the stormwater period. Monies allocated for 2015 total $3,304,000. Capital Improvement Program 2015-2017 Executive Summary

T

he Boston Water and Sewer Commission (“the Commission” or “BWSC”) is a body politic and corporate and political subdivision of the Commonwealth created by Chapter 436 of the Acts of 1977 (“Enabling Act”). The Enabling Act abolished the water and sewer divisions within the City of Boston Public Works Department and transferred the ownership, operation and control of the water, sewer and storm drain systems to the Commission. As a public instrumentality, the Commission performs an essential public function in providing water and sewer services to the residents of the City of Boston. The Act authorizes the Commission to construct and make improvements to the water and sewer systems, establish and collect rates and charges for its services and finance its operations and improvements through revenue collections and the sale of bonds and notes payable solely from the Commission’s revenues. The Act further provides that any revenue surplus realized by the Commission in any Fiscal Year shall be used to offset future rate increases. Since its inception, the Commission has generated a surplus in each year of its operations and has applied the surplus to the reduction of the succeeding rates.

Discussion of Management Objectives and Accomplishments

Sewer and improve The Commission was created to maintain the long-term quality and reliability of water and sewer services for all users in the City and to assure adequate funding for operation and maintenance of the Systems. For the purposes of this document, “Systems” include the water distribution system (including potable water and fire suppression facilities) and sewer system (including separate sanitary sewers, separate storm water drains and combined sewers) and the related appurtenances and fixtures. The Commission is committed to four primary goals: • To maintain and improve the Water Distribution and Wastewater Collection Systems. The Commission is committed to a number of improvements to the Water Distribution and Sewer Systems, including following an aggressive renewal and replacement program, reducing unaccounted for water, encouraging conservation and improving the environment.

APRIL, 2015

• To establish and administer a billing and collections system that is fair and efficient. The Commission has worked to Mass establish rate structure that fully reflects Ave a48” Drain Installation its costs, fairly distributes the financial obligation concerning its customer base and encourages water conservation. The metering, billing and collection process is a central focus of the Commission’s full management team and the Commission is committed to maintaining its strong record in that area. • To maintain a strong financial structure. The Commission consistently employs conservative financial projections and budgeting assumptions, maintains adequate reserves and strikes a reasonable balance between debt funding and rate funding of capital expenses. • Sustaining Effectiveness of Investments. The Commission is committed to complying with all its regulatory obligations under federal and state laws, including the Safe Drinking Water Act (“SDWA”), Clean Water Act (“CWA”) and its National Pollutant Discharge Elimination System (“NPDES”) permitting obligations for both its stormwater system and combined sewer system. Compliance obligations also extend to meeting and exceeding the goals and requirements of the Boston Harbor decree and the Consent Decree executed in 2012 with the Environmental Protection Agency (“EPA”) related to stormwater discharges. continued on page 30

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Since 1999, the Commission has spent more than $286 million on sewer separation projects. Projects were designed with the intent of eliminating CSO discharge, improving water quality in Boston Harbor and its tributaries and diverting stormwater from environmentally sensitive areas. Thus far, these projects have reduced annual discharge of CSO by 124.3 million gallons per Boston Water and Sewer continued from page 29 year. The Commission’s major achievements The Enabling Act and Commission’s General in 2009 were the the completion of the Fort Point Revenue Bond Resolution, adopted December 6, 1984 Channel and Morrissey Boulevard projects. (“the Resolution”) requires the Commission, on an anthese Improvement projects the nual basis, Upon developcompletion a three-yearof Capital Commission began generated the Reserved Program (“CIP”). Information by theChannel Comproject. mission’s ongoing monitoring programs for the Systems and from various engineering data files, together with the Fort Channel and Morrissey informationWhile concerning thePoint development needs of the Boulevard projects have successfully City, is used to compile a list of pipes, conduits,reduced transmission mains and other components be either annual CSO System discharge by over to12 million renewed, replaced, or added to theproject Systemsis gallons, relocated the Reserved Channel each year. The CIP outlines theannual schedule and implemenexpected to reduce discharge of CSO in 2017 CIP are to ensure the delivery of high quality potation of thethe capital projects necessary to maintain and water for consumption and fire protection, as well area over 92% upon its completion in tableAve Sewer Separation improve the water and sewer systems for the ensuing Mass as the efficient collection of sewage for transport and de2016. three-year period. Complying with the requirements of livery to a treatment facility or for approved discharge. the Enabling Act and the Resolution, the Commission In addition, the CIP includes projects to improve overall projected cost of the Commission’s Capital Improvement efficiency of the Commission and to enhance the ComProgram from Fiscal Years 2015 through 2017 totals apmission’s ability to provide services to its customers. proximately, 203.5 million. Expenditures are divided into three categories: WaSewer23, 2012, the Commission entered in 64 On August ter Distribution System projects; Sewer System projects; a Consent Decree with the Environmental Protection and Support projects. Water Distribution System projAgency (“EPA”). ects account for $90.1 million, or 44.3% of the 20152017 CIP. Sewer System projects comprise $76.5 milUnder the terms of the Consent Decree the Commislion, or 37.6% and Support projects total $36.9 million, sion implemented a Capacity, Maintenance, Operations or 18.1% of the expenditures outlined in the program. and Management (“CMOM”) self-assessment study in 2012 that analyzed all aspects of the Commission’s saniTotal capital expenditures of $86.6 million are outtary sewer and storm drainage facility operations and mainlined for 2015. Water Distribution projects comprise tenance. The Commission finalized a CMOM Corrective $39.9 million, or 46.1%. Sewer System projects account Action Plan in July 2013 and developed a CMOM Program for $36.3 million or 41.9% and Support projects totaling Document in May 2014. The CMOM Program will syn$10.4 million consisting of the remaining 12.0% of the chronize infrastructure maintenance and operations goals 2015 amount. with long-term CIP planning to achieve CWA compliance Tables 1 and 2 on the following page present the with the Commission’s NPDES permit and ultimately imcash flow expenditures and funding sources for the prove water quality. Commission’s 2015-2017 CIP. The overall objectives of the Commission 2015continued on page 31

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Boston Water and Sewer continued from page 30

2015-2017 CIP Cash Flows Table 1 PROGRAM Water

2015

2016

2017

TOTAL

$ 39,926,000 $ 35,197,000 $ 14,994,000

$ 90,117,000

Sewer $ 36,337,000 $ 25,452,000 $ 14,743,000

$ 76,532,000

Support

$ 10,350,000 $ 13,664,000 $ 12,820,000

$ 36,834,000

TOTAL

$ 86,613,000 $ 74,313,000 $ 42,557,000

$ 203,483,000

NOTE: Although expenditures decrease from periods 2016 to 2017, it is anticipated that funding for 2017 will be equal or greater than funding presented in 2016. The decrease in 2017 is primarily due to the CIP being a one-year cash flow, over a three-year budget period.

2015-2017 CIP Funding Sources Table 2 FUNDING SOURCE

2015

2016

2017

TOTAL

BWSC Bonds

$ 61,481,000

Rate Revenue

$ 12,759,000 $ 16,252,000 $ 15,428,000 $ 44,439,000

MWRA Water Assistance

$ 8,246,000 $

5,678,000 $ 2,132,000

$ 16,056,000

MWRA I/I Assistance

$ 4,127,000 $

1,700,000 $ 1,800,000

$ 7,627,000

TOTAL

$ 86,613,000 $ 74,313,000 $ 42,557,000 $203,483,000

$ 50,683,000 $ 23,197,000

$135,361,000

NOTE: Although expenditures decrease from periods 2016 to 2017, it is anticipated that funding for 2017 will be equal or greater than funding presented in 2016. The decrease in 2017 is primarily due to the CIP being a one-year cash flow, over a three-year budget period. continued on page 33

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Boston Water and Sewer continued from page 31

Project Highlights

T

he Commission’s CIP includes projects to improve the overall efficiency of the Commission and to enhance the Commission's ability to provide services to its customers. The projects included in this CIP are intended to accomplish these objectives in the most efficient and cost effective manner. The Commission intends to enhance Boston’s water and sewer infrastructure with several targeted projects included in the 2015-2017 Capital Improvement Program. Some of the major projects are listed below: • Update of Water Pipe Ranking Software • Water Main Replacement Program • Sewer & Drain Rehabilitation & Replacement in the North End • Lining of the West Side Interceptor • Engineering Design Services for Sewer Separation in Roxbury • Separation of Sewers in Roxbury • Separation of Sewers in the Reserved Channel Area of South Boston • Sewer Model Improvements

• Upgrade of MTUs and DCUs with Latest Technology • Several Project affiliated the Consent Decree; including cleaning and televising ninety miles of sewer and drains The Commission began the development of a Wastewater and Storm Drainage System Facilities Plan in 2011. The objective of the Wastewater and Storm Drainage System Facilities Plan is to develop facility plans for the Commission’s sewer and storm drains that are aligned with the Commission’s primary service goals and supported by effective operations, maintenance, and engineering practices. Critical elements of this project include: • Assessment of the Commission’s Service Goals and other factors affecting long-term planning including changing regulatory requirements, climate change and financial conditions • Systematic use of Risk-based tools to govern prioritization of investments in condition assessments, repairs and replacements continued on page 35

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Boston Water and Sewer continued from page 33 • Integration of Business Process needed to sustain effective Capacity, Management, Operation and Maintenance (CMOM) Programs for sanitary sewer collections systems and engineering programs • Training and Education to embrace the use of new tools and business processes and to sustain knowledge of the system and its operations In addition to establishing a sustainable framework for planning and management, the Wastewater and Storm Drainage Facilities Plan project includes a broad spectrum of data collection, engineering evaluation and tool development activities.

Projects Associated with the Consent Decree

T

here are several new and pre-existing projects that the Commission is currently performing and planning to undertake to fulfill and exceed recommendations of the Environmental Protection Agency (“EPA”) under the Consent Decree. The following projects will support the Commission’s goal of compliance with the Consent Decree and improved water quality discharges and the environment:

New Projects • Systems Operations Monitoring Center • Design of Constructed Wetland in Stormwater Tributary Area • Urban Runoff Water Quality Evaluation • Interactive Training Tool • Constructed Wetland in Stormwater Tributary Area • Green Infrastructure Low Impact Development Area A • Green Infrastructure Low Impact Development Area B

• Green Infrastructure Low Impact Development Area C • Constructed Rain Gardens • CCTV of Sewers and Storm Drains (Contamination Investigation) • Cleaning and Inspections of Sewers and Storm Drains (CMOM-Capacity Management Operations and Maintenance)

Ongoing Projects • Model Improvements • Stormwater Fee Evaluation • Construct Best Management Practices & Green Infrastructure Central Square in East Boston • Construct BMPs & Green Infrastructure at City Hall Plaza • Construct BMPs & Green Infrastructure at Beacon St. & Park St. • Industrial Facility Stormwater Prevention Program • CSO Public Notification Program (Contract 12206-009) • Fort Point Channel Water Quality Assessment • Fort Point Channel Implementation of Recommendations • Augment Drain Model to Characterize Water Quality • Wastewater/Drainage Facilities Plan • Citywide Illegal Connection Investigation Program Phase III (Contract 11-206-009) • Owner Correction of Illegal Connections • Separation of Sewer House Laterals (Contract 14309-007) Note: The full description and forecasted budgets of individual projects is available in the Sewer section of the complete 2015-2017 CIP at www.bwsc.org. continued on page 36

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April 2014 and be completed by September 2016. The three-year budget for this project is $3,288,000. Contract 12-309-009: The purpose of this project is to separate flows in the A Street Area in South Boston. These flows are tributary to the South Boston Water and Sewer continued from page 35 Boston Interceptor-North Branch. The removal of Projects included in the Sewer System CIP include this stormwater will achieve two benefits; (1) a the rehabilitation or replacement of approximately 2.5 reduction the costsorassessed the MWRA miles ofin deteriorated collapsedby sanitary sewers and and drains along the television inspection of (2) storm a reduction in thewith frequency of the overflows approximately 95-100 miles of sewer pipe. Also infrom the combined sewers. Construction of these cluded are drainage improvements in the replacement improvements will help to reduce overflows to the of faulty tide-gates. Fort Point Channel fromfunding BOS 072. The CIP continues for theConstruction separation of combined sewers and for the2013 reduction commenced in September andofisinfiltration projectedand to inflow into the sanitary system. Infiltration and inflow be completed by May 2015. A budget of $448,000 I/I is extraneous quantities of water, which enters the willsanitary be established inreduce 2015.the capacity of the system to sewers and

Beach area of East Boston and the Fort Point Channel 54” DrainBoston. Installation on K St. Associated areaRDP of South Currently underway is thewith comReserved Channel Separation pletion of the Reserve Channel sewer separation. The transport sanitary sewage. Reduction of I/I also decreasprojects resulted in the installation of approximately two es the quantity of waterThe transported to the Massachusetts hundred thousand feet of new drain pipethree and the replaceContract 11-206-012: contract involves construction management services for the contracts Water Resource Authority (“MWRA”) wastewater treatment of old water pipe and defective sewer pipe. The final involved in the sewer separation in the Massachusetts Avenue and A St areas. The neighborhoods ment facilities, thereby reducing overall transportation result substantially decreased the amount of combined affected by this contract are Dorchester, Roxbury and sewer Southoverflows Boston.into Construction for three contracts costs, treatment costs and BWSC sewer assessments. the Charles River, Neponset River and Boston Harbor. In addition the work greatly reduced commenced in February 2012 and is estimated to be completed in September 2015. The three-year The Commission has executed agreements with the amount of drainage entering the Commission’s sewer MWRA, which is under a court order decree to elimibudget for this project is $598,000. system reducing discharges to MWRA. nate or substantially reduce combined sewer overflows. MWRA provided funds for sewer separation in DorchesA complete description of the MWRA’s CSO proter, the Stony Brook area of Jamaica Plain, the area of gram is in the 2015-2017 CIP, available at www.bwsc.org. continued on page 37 Boston known as the Bullfinch Triangle, the Constitution

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Boston Water and Sewer continued from page 36

BWSC 2015-2016 CIP Upcoming Projects Sewer and Drain Projects

WATER MAIN REPLACEMENT

Ridgeway Lane

400 Feet

60 Miles Each $2.6M

$.75M

March 2015

West Roxbury/Hyde Park 7,665 Ft

$3.2M

Jan 2015

Roxbury/South End

4,510 Ft

$2.8M

Feb 2015

Sewer & Drain Inspection 1 & 2

Beacon Hill/East Boston

10,500 Ft $3.7M

March 2015

Sewer & Drain R & R 11,810 Feet

$3.2M

July 2015

Jamaica Plain

7,120 Ft

$3.2M

March 2015

West Side Interceptor Lining

2.4M

Sept 2015

Roxbury

6,370 Ft

$3.6M

April 2015

Dorchester/Mattapan

7,350 Ft

$2.5M

June 2015

West Roxbury

14,255 Ft $4.0M

July 2015

City Proper/Back Bay

7,120 Ft

$4.0M

July 2015

Fenway/Jamaica Plain

5,300 Ft

$1.5M

Aug 2015

WATER MAIN REPLACEMENT

2,165 Feet

April 2015

Sewer and Drain Projects

Sewer and Drain R&R

8,625 Ft

$2.4M

Jan 2016

Installation of Tidegates

5 Tidegates

$.2M

Feb 2016

Brighton/Dorchester

5,300 Ft

$1.7M

Aug 2015

Sewer Separation in Upper Roxbury

4,500 Ft

$5.0M

April 2016

E. Boston/S. Boston

9,775 Ft

$3.0M

Sept 2015

North End Phase 2

1,150 Ft

$2.2M

June 2016

Fenway/Kenmore

3,775 Ft

$2.5M

Dec 2015

South End

9,800 Ft

$3.0M

Mar 2016

Dorchester/Hyde Park

8,805 Ft

$2.5M

April 2016

Allston/Brighton

11,160 Ft $4.0M

April 2016

Water Main Cement Lining Jamaica Plain/Fenway

7,770 Ft

$2.4M

Sept 2015

Future Projects

 Water Main Replacement conAnues  Sewer and Drain Replacement and Rehab  Major Cleaning and television inspecAon  BMP/LID Projects Citywide  Citywide I/I Study

APRIL, 2015

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Salute to CharlieSalute Button MWRA

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Don’t dig yourself into trouble... The Perfect Excavation: • Pre-mark the location of intended excavation using white stakes, paint or flags. • In MA, ME, NH and RI, notify Dig Safe® at least 72 business hours in advance. • In Vermont, notify Dig Safe® at least 48 business hours in advance. • Notify non-member facility owners. • Maintain the marks placed by underground facility owners.

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I n M emoriam Charles Button

W

e are deeply saddened to announce the passing of long time UCANE member and friend, Charlie Button on March 17, 2015 after a successful career spanning 45 years with the Hartford, CT Metropolitan District Commission, Boston Water & Sewer Commission, and the Massachusetts Water Resources Authority. Charlie is survived by his wife Sharilyn, son Robert and his wife Susan, son John and his wife Danielle, and his grandchildren John, Alexandra, Jack, and Nicholas. Charlie was loved and respected by everyone he came in contact with on both a personal and professional level. In 1968 he graduated from Tufts University with a Bachelor’s Degree in Civil Engineering, and in 1973 he earned a Master’s Degree in Environmental Engineering from UConn. His background in water management started with his employment as Chief Engineer of the Hartford, CT MDC, and then as Chief Engineer of the Boston Water and Sewer Commission. His accomplishments at BWSC did not go unnoticed, and he was later hired by the MWRA as their Chief Engineer, and then promoted to the position of Deputy COO before retiring from the MWRA. While at the BWSC and MWRA, Charlie worked closely with UCANE members on clean

APRIL, 2015

water and drinking water issues and he had great respect for the difficult and dangerous work our members performed. Likewise, our members respected his candor, his professionalism and his willingness to resolve problems and issues that invariably arise between customers and contractors. Charlie knew the importance of UCANE, and after retirement, he formed his own company, Freshwater Consulting, and formally joined UCANE as an Associate Member. He always looked forward to attending UCANE functions and was particularly fond of attending our Annual Banquet where he could renew old friendships and trade stories about the past, and also listen to the progress being made to improve the MWRA system. Charlie was a former member of the Ironworkers Local 7 and he believed in public service. He held many high positions including, Chairman of the Boston Conservation Commission, a member of the Board of Overseers of the Boston Museum of Science, and as a member of numerous professional, civic, and academic associations. The Officers, Board of Directors, members, and staff of UCANE extend their deepest and sincerest condolences to Sharilyn and the entire Button family. Charlie’s legacy of good work will always be remembered. n

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Civilian Board of Contract Appeals Allows Contractor to Stop Work on Troubled VA Project An age-old rule of government contracting, both state and federal, is that the contractor cannot stop work in the face of a dispute with the owner. Instead, the contractor must continue its work “under protest” while it pursues its claim under the dispute resolution provisions of the contract. This rule was recently called into question by the Civilian Board of Contract Appeals (CBCA), an influential arbiter of federal contract claims, which held that a contractor was entitled to stop work on a Department of Veterans Affairs (VA) project, due to VA’s material breach of the underlying contract.

K

iewit-Turner, A Joint Venture (KT) was awarded a contract for preconstruction services on a medical center campus in Aurora, Colorado. The contract type was “integrated design and construct” (IDc). KT’s contract also included an option for construction services, under which KT would actually build the project. Under an IDc contract, the contractor consults the owner as the design progresses, and makes recommendations regarding potential design changes

APRIL, 2015

and funding decisions, with the goal of achieving cost savings and other project efficiencies. By the time KT was brought on, however, the design was already 50% complete, and key funding decisions had already been made. This limited KT’s meaningful participation in the design and funding process. On the same day that KT was awarded its contract – before KT could provide any input regarding the design or the budget – VA established the “estimated construction cost at award” (ECCA), which set the project’s construction cost target at $582,840,000. This would prove to be a fateful funding decision. Once KT began its preconstruction services, it repeatedly advised VA that the design was incomplete, over-budget, and not properly coordinated, among other things. Despite these warnings, the VA did not take proper steps to control its design team (such as by insisting on additional value engineering continued on page 43

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Legal Corner continued from page 41 [VE]). In addition, throughout this process, KT provided ever-increasing estimates of the project’s construction costs. Although all of these estimates exceeded the ECCA, VA and KT eventually executed a modification that required VA to provide a complete design that could be built for the ECCA. In exchange, KT agreed to perform the construction work for a firm target price of approximately $603 million. (At this time, VA possessed an estimate from its construction manager that the construction would cost more than $677 million.) The project continued to be plagued by VA mismanagement. VA did not provide 100% construction drawings in a timely manner, and the 100% drawings that were finally issued were several months late and incomplete. Meanwhile, the project’s costs continued to escalate dramatically, as the design team refused to provide adequate VE. Indeed, one estimate showed that construction costs could exceed $1 billion.

parently key to the Board’s decision was the fact that VA had not requested or obtained any additional funding for the project. The Board’s answer to the third question is unusual in government contracting. Almost all federal contracts include FAR 52.233-1(i), which requires a contractor to proceed with performance even in the face of unresolved disputes: The Contractor shall proceed diligently with performance of this contract, pending final resolution of any request for relief, claim, appeal, or action arising under the contract, and comply with any decision of the Contracting Officer. In practice, the above Disputes Clause means that the contractor cannot stop work except under very limited circumstances. Instead, when a contractor and the government disagree (over whether certain work is outside the contract’s scope, for example), the contractor must reserve its rights and continue working under protest. The overriding rationale is that a contractor cannot be allowed to hold a project hostage by stopping work due to unresolved disagreements.

After spending over $20 million of its own funds Here, without even mentioning the Disputes to try to keep the project moving forward, KT reClause, the Board held that KT was entitled to stop quested a Contracting Officer’s Final Decision recontinued on page 45 garding whether VA had breached the contract. The contracting officer denied that VA breached the contract and directed KT to proceed with the work. KT then appealed to CBCA, Water Works Specialist where KT posed the following John Hoadl Water Works Specialist Tel:781-878-8098 Fax:781-878-5298 questions: Water Works Spe Tel:781-878-8098 Tel: 781-878-8098 Fax: 781-878-5298 1. Did VA obligate itself to provide a design that could be “Our Products the Most Trusted NamesNames in theinIndustry” “OurIndustry” Products Are the Most Trusted N “OurAre Products Are the Most Trusted the built for the ECCA? � U.S. Pipe ● Cultec � U.S. Pipe ● Cultec Chambers � Mueller Fire Hydrants ● Nation • U.S. Pipe • Cultec Chambers 2. Did VA materially breach Mueller Tapping Sleeves & Valves ● ADS P � Mueller Fire Pipe & Plastics • Hydrants Mueller Fire Hydrants ● National • National Pipe�� &Smith Plastics the contract by failing to Blair Clamps & Couplings ● Genera � Mueller Tapping Sleeves & Valves ● Valves ADS Pipe Chambers • Mueller Tapping Sleeves & • &ADS Pipe & Chambers provide such a design? Mechanical Services � Tapping Sleeves & Gates Installed • Smith Blair Clamps & Couplings • General Foundry Castings � Smith Blair Clamps & Couplings ● General Foundry Castings 3. If VA materially breached

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Legal Corner continued from page 43 work. Driving the Board’s decision were its findings that VA’s mismanagement of the project was particularly egregious, as well as that KT had already financed over $20 million of work. Perhaps most important, however, the Board noted that the available funds were unquestionably insufficient and that VA had not requested any additional funding for the project. Because VA refused to redesign the work (to achieve necessary cost savings), KT had no expectation of being fully compensated for its work.

Nevertheless, federal contractors should think long and hard before considering stopping work, regardless of the scope of the disagreement. This is because the vast majority of the time, the Disputes Clause will require the contractor to continue to perform. The KT decision, rather than changing the ageold rule, simply represents a rare exception to it. n

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OSH A UPDATING EYE & FACE PROTECTION STA NDA RDS IN CONSTRUCTION OSHA is finally getting around to updating its construction industry standards for eye and face protection. A proposed rule was published in the Federal Register on March 13, 2015 that would update the standards to be more in line with the general industry and maritime industry standards for eye and face protection. The purpose is to get the OSHA standards up to date with the current national consensus standards, i.e., incorporate the latest American National Standards Institute (ANSI) standards. OSHA is planning to update the general industry and maritime industry standards as well. Those were last updated in 2009, but do not reflect the most current ANSI standards. The construction industry eye and face protection rules were last updated in 1993. Apparently OSHA didn’t have the resources available to update the construction industry standards when it updated the others last time. Most of the changes to the construction industry standards for eye and face protection involve replacing current language with the language found in the general industry standards. The construction industry standards will be dropping the references to the ANSI Z78.1-1968 standard and replace it with the three most recent ANSI standards related to eye and face protections, ANSI Z78.1-2010, ANSI Z78.12003 and ANSI Z78.1-1989 (R-1998). This means that construction employers will be able to use eye and face protection manufactured according to any of the three most current ANSI standards they choose. Remember, employers are required to provide personal protective equipment (PPE) like eye and face protection to employees at no charge. Employers will also be able to use eye and face protection not manufactured to any of the three most recent ANSI standards if they can at least prove it is compliant with one of those three standards. In addition to changing language in the construction standards for eye and face protection to match up with general industry standards, it also deletes some requirements since they are already covered in the ANSI standards being adopted. The proposed changes will retain the requirements for being durable, easily cleanable and capable of being disinfected since ANSI Z78.1-2010 doesn’t include those requirements. Comments for the proposed rule are being accepted by April 13, 2015. Because this is just proposed rulemaking, there is no guarantee that these standards will ever be made final or that changes won’t be made if or when a final rule is issued.

APRIL, 2015

Here’s a look at some of the other rulemakings OSHA is planning to release in 2015 that are construction industry standards or apply to the construction: • Final Rule: Confined Spaces in Construction • Final Rule: Improve Tracking of Workplace Injuries & Illnesses • Final Rule: Walking Working Surfaces and Personal Fall Protection Systems (Slips, Trips, and Fall Prevention) • Proposed Rule: Occupational Exposure to Crystalline Silica • Proposed Rule: Occupational Exposure to Beryllium • Proposed Rule: Amendments to the Cranes and Derricks in Construction Standard • Proposed Rule: Crane Operator Qualification in Construction • Proposed Rule: Quantitative Fit Testing Protocol: Amendment to the Final Rule on Respiratory Protection • Proposed Rule: Clarification of Employer’s Continuing Obligation to Make and Maintain Accurate Records of Each Recordable Injury and Illness Written by Kendall Jones, Editor-in-Chief of Social & Interactive Media, Construction Data Company. Reprinted with permission. n

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Cape Water Quality Plan Given to State BARNSTABLE — The long-awaited update of a regional water-quality management plan for Cape Cod was submitted to the Massachusetts Department of Environmental Protection by the Cape Cod Commission the week of March 15, more than two weeks later than originally planned.

T

he 250-page document presents a comprehensive assessment of the region’s wastewater crisis and potential solutions, but a major component of the multibillion dollar proposal — wastewater management agencies that would be responsible for implementing the plan — is still a work-in-progress. The clock is ticking — and fast — to get the agencies designated and approved. A federal judge ordered that the plan be approved by the DEP and certified by Governor Charlie Baker by June 15, and then sent to the U.S. Environmental Protection Agency, which has until Sept. 15 to approve it. The schedule was agreed to by the Conservation Law Foundation, which successfully sued the EPA to update the Cape’s 1978 Section 208 water quality plan. According to Chapter 8 of the plan, which focuses on implementation, the commission will designate the management agencies by June 1. That leaves just 11 business days for the plan to be routed through the notoriously slow process of approval on Beacon Hill. Caitlin Peale Sloan, an attorney with the Conservation Law Foundation, said that the commission has been in close contact with the Department of Environmental Protection about the tight

APRIL, 2015

approval turnaround since last year, and that it expects the June 15 deadline will still be met. Sloan also said should a delay occur along the way that would necessitate the EPA pushing its deadline back, it would likely ask the New England-based environmental group for an extension. “We can’t comment on how we would respond to an EPA deadline extension request, but they are typically in communication with us well in advance if it is thought that a deadline may be missed,” she said. Paul Niedzwiecki, executive director of the commission, said that the next three months will be spent working with teams from the Cape’s 15 towns to determine whether each town, even though there are many shared watersheds on the peninsula, should be designated a management agency. Organizational structures and responsibilities for the planned agencies will also be discussed. The teams will consist of up to seven members, with five seats for town managers and administrators, staff and elected officials, and two open seats. Other non-town groups that are also being considered for management agency designation include the Orleans-Brewster-Eastham Groundwater Protection District and water districts in Bourne, Buzzards Bay, North Sagamore, Barnstable, Centerville-Osterville-Marstons Mills, Cotuit, Hyannis, continued on page 51

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Cape Cod continued from page 49 West Barnstable, Mashpee, Dennis, and Sandwich. Fire districts in the mix include Barnstable, Cotuit, Hyannis, and West Barnstable. “We’ll run through scenarios as to how technology would be deployed in some shared watersheds, as well as have each town share its wastewater management experiences and discuss what has been working and what has not,” he said. The plan calls for the designated agencies to build and operate technologies outlined in their watershed plans, as well as have the capacity to issue bonds and notes to raise revenue to fund plan implementation. The commission will provide technical assistance to the agencies to support community planning efforts and to assist with decision support tools, permitting of technologies and financing. One potential agency on the list that raised an eyebrow was the Bourne Recreation Authority, which operates the Gallo Ice Arena and Bourne Scenic Park campground. Niedzwiecki said that the recreation organization made the list because the commission looked at all independent authorities on the Cape that may have bonding authority to raise funds.

But, according to Bourne Recreation Authority General Manager Barry Johnson, it doesn't have bonding authority and should not have been on the list. “We do not have borrowing power because we don’t own the land," he said. "We have leases with the U.S. Army Corps of Engineers. When we built the ice arena in the 1970s, the bonds were issued by the town of Bourne." Matthew Sawicki, superintendent of the North Sagamore Water District, said that he was unaware that his organization was being considered as a possible management agency and that he has not been notified of any meetings. “This is the first I’ve heard of it,“ he said. Andy Marks, operations manager for the Mashpee Water District, was also equally surprised to be among the management agency contenders. “This doesn’t ring a bell to me,” Marks said, although he added that it’s possible that discussions could have taken place at another level of town government. Written by Geoff Spillane. Reprinted with permission from Cape Cod Times. n

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UCANE’s Fourth Annual Trade Show

U

CANE held its Fourth Annual Trade Show prior to the March Forecast Dinner Meeting, which was held at the Four Points by Sheraton Hotel in Norwood, MA. UCANE’s Trade Show is slowly becoming a tradition and its primary goal is to support Associate members whose companies advertise in Construction Outlook magazine. With such active and enthusiastic participation, UCANE may need to find a larger facility next year. As in the past, the drawing card for this year’s 35 trade show participants is the attendance of most underground utility company owners and their key employees, who attend to hear speakers from the MassDEP, MWRA, and BWSC present their forecasts for water and sewer projects for the upcoming construction season. To exhibitors, this is a golden opportunity to meet with key decision makers in the underground water and sewer industry, and to sell their products and services prior to the evening’s presentations. This format has proven to be very advantageous for the exhibitors who are provided with a complimentary booth as UCANE’s way of saying thank you for supporting our magazine and our Association.

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The feedback from the participants was overwhelmingly positive. One exhibitor stated, “I had a better turnout here and did more business than at larger trade shows where I sit for two days and, if I’m lucky, get to see a few key people.” Everyone who participated in our Trade Show walked away with something. The exhibitors made many new contacts and actually did some business. All visitors received promotional gifts from the exhibitors, and some, if they were very lucky, received one of the great prizes donated by some of our trade show exhibitors. The prizes included two Red Sox tickets courtesy of Taylor Oil Company; three $100 American Express Gift Cards from HD Supply Waterworks; a Nike Driver donated by Rain for Rent - New England; a Battery Pack Charger from American Shoring Inc.; a $25 American Express Gift Card from A. H. Harris & Sons, Inc.; two Red Sox tickets from ATS Equipment, Inc.; a $100 Capital Grille Gift Card and two pair of Red Sox Tickets from Shea Concrete Products; an iPad Mini from Scituate Concrete Products Corp.; a DeWalt Cordless Drill Set from Ferguson Waterworks; four pair of Celtics Tickets from Concrete Systems, Inc.; and an ATV Vise and Tool Kit from HD Supply Construction & Industrial White Cap.

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APRIL, 2015


UCANE’s Trade Show is our way of thanking our advertisers for their support. They make it possible for us to continue to publish our nationally recognized magazine, and to get our industry’s message about the need for clean drinking water and pollution control projects out to cities and towns, DPW directors, state agency heads, legislators, and many companies and groups in the water protection and management, and environmental communities. Construction Outlook magazine is also the vehicle by

APRIL, 2015

which companies create name recognition and have their latest products and services seen by many company and municipal decision makers. It’s obvious by their continued support that the most successful companies in our industry believe that our magazine helps to grow and expand their businesses. If any company would like to participate in UCANE’s Fifth Annual Trade Show next year, please contact Suzanne at the UCANE office for Construction Outlook magazine advertising opportunities. continued on page 54

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Thank You to A ll of Our Trade Show Participants ATS Equipment, Inc. A merican Shoring Inc. Aon Construction Services Group Concrete Systems, Inc. Dedham R ecycled Gravel EJ Eastern States Insurance Agency, Inc. Eastpoint L asers, LLC* Ferguson Waterworks HD Supply Waterworks HD Supply Const. & Industrial White Cap A. H. H arris & Sons, Inc. JESCO Lorusso Heavy Equipment, LLC M abey, Inc. North East Shoring Equipment, LLC Northland JCB NorthStar Insurance Services, Inc.* Ocean State Oil Our Outhouses, Inc. E. J. Prescott, Inc. R ain For R ent – New England R ead Custom Soils Rodman Ford Sales, Inc. Schmidt Equipment, Inc. Scituate Concrete Products Corp. Scrap-It, Inc. Shea Concrete Products Taylor Oil Company A lbert J. Tonry & Co., Inc. TrenchTech Inc. United Concrete Products, Inc. United R entals Trench Safety C. N. Wood Company, Inc. Woodco M achinery, Inc. * Company Photo Unavailable APRIL, 2015

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Kleinfelder’s John Struzziery Named Top 25 Newsmaker

K

leinfelder recently announced that John Struzziery, senior program manager, has been named one of Engineering News-Record’s (ENR) Top 25 Newsmakers of 2014. The award was presented during ENR’s black-tie gala, held in New York City on April 16. ENR’s Newsmakers are selected for their “outstanding accomplishments, for exceeding expectations, for injecting an original idea or new approach that would take the place of traditional practices, or for performing some special service that benefits the industry and the public.” Struzziery was chosen for his leadership of the Alewife Stormwater Wetland Project in Cambridge, MA, a public project lauded for applying natural, sustainable techniques to resolve a significant combined sewer overflow problem while restoring the area’s natural hydrology, protecting and enhancing the local ecosystem, and creating new recreational and educational features for the community. Once separation of the combined sewer system is fully complete upstream – by the court-ordered milestone of December 2015 – the combined sewer overflows to the Alewife Brook will be reduced by 84 percent or 43.6 million gallons annually. The park includes walking trails, boardwalks and scenic overlooks for the public to view the enhanced habitats, including shallow and deep-water marshlands, open water and tree islands. The wetland, planted with over 124,000 native plants, is a safe haven for migrating birds and the alewife and blueback herring, both threatened species.

In the article, ENR calls the project a “template for cities to control runoff with green, rather than “gray” infrastructure that also offers a larger public benefit.” Under his leadership, the project has been awarded the 2014 Best Water/Environment Project from ENR Northeast, the 2014 Best Environmental Project of the Year and Best Public Works Project of the Year from the American Public Works Association (APWA), and the 2014 Engineering Excellence Gold Award from the American Council of Engineering Companies Massachusetts (ACEC/MA). “I’m honored to accept the ENR Newsmaker award for the entire Alewife team,” says Struzziery. “Through creativity, innovation and teamwork, we found a way to solve a very complex and serious problem while providing long-term value to the environment and the public. To lead this project from concept to reality was an amazing experience.” Struzziery has over 38-years of experience in civil and environmental engineering and construction, including wastewater, water, stormwater and solid waste projects. Since 1998, Struzziery has been Kleinfelder’s senior program manager for the $300-million Cambridge Sewer Separation and Stormwater Management Program and is responsible for the overall program coordination. He is a professional engineer in Massachusetts, Maine and New Hampshire. Reprinted with permission from Underground Construction magazine. n

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TRUCK SIDE GUARD ORDINANCE SUMMARY As the first of its kind in the nation, the Truck Side Guard ordinance championed by Mayor Walsh applies to motor vehicles weighing over 10,000 lbs. and semi-trailers with a total weight exceeding 26,000 lbs. The ordinance requires City agencies to contract only with vendors that have properly installed the following: side guards, convex mirrors, cross-over mirrors, and blind-spot awareness decals. These features are intended to reduce the risk of unprotected road users from falling under the sides of vehicles and getting caught under the rear wheels. The ordinance does not apply to several types of large vehicles, such as agricultural trailers, fire engines, and trucks used exclusively for snow removal.

REQUIREMENTS LATERAL PROTECTION (Side Guards) Device must not increase the width of the vehicle. Device is rigid and securely mounted.

CONVEX MIRRORS Objects can be seen down the full length of the vehicle. Objects can be seen 3’ above the ground.

CROSS-OVER MIRRORS Objects can be seen 3’ above the ground, from the bumper to where direct vision is possible.

SAFETY DECALS

Vehicles designed in a manner that protects against lateral accidents, by virtue of their shape and characteristics, may satisfy the above requirements.

FRONT

SIDE VIEW

Studies by the U.S. Dept. of Transportation have determined the cost of sideguards to be an average of $847. *They are typically installed as a bolt-on addition and can be fixed or hinged. Mercedes and Volvo have produced side guard models. *In the City of Boston pilot, each truck was outfitted for $1,200.

“Safety yellow” in color or bright. Minimum of 3 located in vehicle blind spots on side and the rear.

TOP VIEW

COSTS, APPLICATION

12” max.

5” max.

max. 14” below structure of vehicle

SIDE GUARD max. 21.5” above ground

DIMENSION REQUIREMENTS FOR SIDE GUARDS Lowest edge of is maximum 21.5” above the ground. Upper edge is maximum 14” below structure of vehicle.

Not over 5” inboard of maximum width of vehicle. Not over 12” from outer part of front and rear tire.

continued on page 61

APRIL, 2015

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59


You put building first.

We put you first. Whether you’re a plumber, an electrician or a general or specialty contractor, you need a risk plan developed by an agent who puts your needs first. As one of the largest independent insurance agencies in New England, we can design a competitive and comprehensive insurance plan just for you. And when you feel secure, we do too. For an in-depth review of your program, call Eastern Insurance Group at 508-620-3412.

insurance

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continued from page 59

SAMPLE OF GUARDS FROM BOSTON’S PILOT

AIRFLOW DEFLECTOR made by Airflow Deflector www.deflecteurairflow.com/ sideguardprotection

CUSTOM ‘RAIL’ STYLE made by J.C. Madigan Inc. www.jcmadigan.com

CUSTOM ‘GRILL’ STYLE made by Susi Auto Body www.susiautobody.com

Common Questions What types of vehicles does this ordinance apply to? This ordinance applies to large vehicles (over 10,000lbs) and semi-trailers used by City of Boston vendors within the City of Boston Do I need an inspection before I start work on a contract? Yes When does the ordinance go into effect? All contracts starting on or after May 5, 2015 must comply Can tool boxes work as guards? Yes, but the tool box must meet all the required measurements in the ordinance Do subcontractors with trucks regularly working on a job need to be inspected and permitted? Yes What about deliveries to a job site? The City does not view a subcontractor that simply delivers materials or goods to a job site or to a City Department to be a “Vendor” subject to the ordinance.”

Cross Over Mirrors

If I typically rent trucks for a job, do those need to be inspected and permitted? Yes

Help drivers see objects in the front blindspot of large trucks

Will the City do an off-site inspection for larger fleets? Yes, depending upon Cross Over Mirror

availability of inspectors and distance. Call the number below.

CALL TO SCHEDULE AN INSPECTION

Photo Credit: NYCDOT

Photo Credit: Jim O’Grady, WNYC

APRIL, 2015

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Dedicated to exceeding your expectations. Palmer Paving is an industry leading heavy highway civil engineering construction firm, serving both public and private sector clients. With our own HMA and aggregate processing plants, we are fully integrated as a materials producer and roadway contractor for projects of any size. We welcome your inquiries and look forward to helping you solve your next site, road construction or infrastructure challenge.

Palmer Paving Corporation, Inc 25 Blanchard Street, Palmer, MA 01069 413-283-8354

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23 Arthur Street Easthampton, MA 01027 413-527-6900

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John E. Merchant, CPA

Cullen, Murphy & Co., P.C.

IN THIS ISSUE: • Are Tax Refunds Good or Bad? • Seeking Safety in Long-Term Treasuries • Private Health Insurance Exchanges for Business Owners

F

Smart Tax, Business & Planning Ide

Are Tax Refunds Good or Are Tax Refunds Good or Bad? Does ove

ew people pay exactly the correct amount of income tax during the year. When you file your return for 2014, you probably will find that you paid too little (and owe more tax) or paid too much (and can request a refund). Typically, refunds are due to employees who have too much tax withheld from their paychecks. Example 1: Arlene King is paid twice a month. From each paycheck, her employer withholds $1,000 for federal income tax, so Arlene’s tax payments for 2014 were $24,000. When Arlene files her 2014 tax return, she sees that her tax obligation for last year was $21,000. Thus, Arlene can request a $3,000 tax refund. Does over-withholding and getting a refund in this manner make sense financially? That depends on a taxpayer’s situation. Positive Features

The advantage of getting a tax refund is, well, who wouldn’t want to receive a large check from the federal government? Moreover, federal income tax refunds aren’t taxable. (A state or local tax refund may increase the tax you’ll owe.) Thus, Arlene may decide to use her $3,000 refund check to invest or to pay down debt or to make a special purchase. In effect, her $3,000 of excess tax withholding becomes a form of forced saving, which she can utilize every year when the check comes in.

APRIL, 2015

a refund in financially? situation.

Positive

The advant refund is, w receive a lar governmen tax refunds local tax ref Now for the Negatives you’ll owe.) Fewthepeople exactly On other pay hand, havingthe toocorrect much money with- Thus, Ar held amount for income has been likened the to making of tax income tax during year. an in- $3,000 refu terest-free loan to the IRS. It’s your money—you earned pay down d When you file your return for 2014, you it—so why wait for months to get your hands on it? This probably will find that you paid too little purchase. In strategy can be especially unappealing if your over(and owe more tax) or paid too much tax withhol withholding results from a major change in your life. (and can request a refund). Example 2: In early 2014, Typically, Bianca and Craig forced savin Carter boughtare a due house, using a large mortgage for year when t refunds to employees who the purchase. Biancatax leftwithheld her job to staytheir home with have too much from their young child. Thus, the Carters had lower income Now for paychecks. and higher deductions than in 2013, resulting in a On the oth smaller Example tax bill. 1: Arlene King is paid money with twice a month. From paycheck, her However, Craig did noteach adjust his tax withholding at work. Thus, he paid$1,000 more tax necessary been likene employer withholds forthan federal throughout year. It’s trues that the Cartersfor will get loan to the incomethe tax, so Arlene’ tax payments back the overpayment with a 2015 tax refund, but earned it— 2014 were $24,000. When Arlene files they went through 2014 with less cash flow than reherforcing 2014 tax return, she sees that her quired, them to struggle to cover the costs of get your ha be especiall taxhome obligation for last family. year was $21,000. a new and a growing continued on page 64 withholding Thus, Arlene can request a $3,000 tax in your life. refund.

“BUY FROM THE ADVERTISERS IN CONSTRUCTION OUTLOOK”

63


Financial Management continued from page 63 Winning the Numbers Game If you feel that you need the disciplined forced savings of over-withholding, then relying on an annual tax refund may make sense. Conversely, if you prefer to get your money as you earn it, you can reduce the amount withheld by filling out IRS Form W-4, Employee’s Withholding Allowance Certificate, and submitting it to your employer.

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continued on page 65

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“BUY FROM THE ADVERTISERS IN CONSTRUCTION OUTLOOK” APRIL, 2015 56 “BUY FROM THE ADVERTISERS IN CONSTRUCTIO


Financial Management continued from page 64

S

Seeking Safety in Long-Term Treasuries

ince the financial panic of late 2008, U.S. stocks have posted positive returns for six consecutive calendar years. As of this writing, major market indexes are not far below record levels. Although the future is unpredictable, it’s possible that a moderate or even a sharp reversal will occur. Concerned investors might reduce allocations to stocks and raise their holdings of bonds, especially long-term U.S. Treasuries, which historically have offered a safe haven in tumultuous times. In 2008, for instance, most investments plunged, but long-term Treasuries thrived—Morningstar reports that long-term government bonds returned almost 26%. When the going gets tough, many investors get going into U.S. government bonds with maturities over 10 years.

higher or lower yields. Today, some popular longterm government bond funds have yields of 2.6% or higher. What’s more, interest from Treasury bonds is exempt from state and local income tax. Thus, Treasury issues may appeal to residents of high-tax states and localities. Predicting interest rate movements and the impact on bond prices is always difficult. Nevertheless, there are some positive signs for long Treasuries now. Historically, interest rates have moved higher— driving bond prices lower—during inflationary times. Inflation currently does not appear to be a major concern, especially with oil prices at reduced levels. In addition, the U.S. dollar has been appreciating versus other currencies, and a strong dollar may create worldwide demand for U.S. government bonds. Altogether, low inflation and a robust dollar continued on page 67

Ample Advantages With or without a stock market setback, long-term Treasuries have appealing features. There’s little risk that investors will not be repaid by the borrower—the federal government. They are easy for individuals to buy; just go to www.treasurydirect.gov/tdhome.htm and provide the requested information. There are no fees for buying or holding Treasuries there, and the minimum purchase is just $100. As you might expect for a safe investment, yields on long-term Treasuries are modest in today’s low yield environment. Yet, they’re not negligible. Currently, long-term Treasuries yield from 2% to 2.5%, depending on years to maturity. That’s more than bank accounts and money market funds are paying now. When you buy long-term Treasuries, you’re locking in that yield for the next 10 to 30 years. If you prefer to invest through funds, you can choose among many that hold long-term Treasuries, including some with very low expenses for investors. Yields typically aren’t locked in because these funds keep acquiring additional issues, with

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LORUSSO CORPORATION 3 Belcher Street, Plainville, MA 02762 Tel: 508-695-3252 Fax: 508-699-2387 Email: sales@lorussocorp.com QUARRY & RECYCLYNG 40 Cross Street • Plainville, MA 125 Tiffany Street • Attleboro, MA ASPHALT PLANT 635 Pleasant Street Norwood, MA

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APRIL, 2015


Financial Management continued from page 65

Did You Know?

might keep the price of long-term Treasuries from falling. Some financial advisors believe that allocating about 10% of an investment portfolio to longterm Treasuries is prudent now. These bonds may offer decent yields as well as a hedge against possible weakness in economic growth, corporate profits, and stock prices.

T

he federally sponsored Pension Benefit Guaranty Corp. provides benefits to participants in terminated private sector plans. The maximum guaranteed benefit for a 65-year-old retiree getting a single-life annuity is $60,136 in 2015. For jointand-50% survivor annuities, the maximum payment this year to a 65-year-old couple is $54,123. Source: pbgc.gov

Nevertheless, long-term Treasuries can pose concerns for investors. Locking in 2% –2.5% yields for 10 years or longer might not turn out to be a good decision if interest rates rise from today’s low levels. Higher interest rates will keep your employees on , y bring down bond prices, and e si on s m ey, keep your employees o te wi i long-term issues usually suffer n si th e te w m s mon the largest loss of principal. ith ei m In 2009 and 2013, long-term government bonds lost 15% and 11% of their value, respectively, while intermediate-term government issues lost only 2% and 1%. To some skeptics, buying long-term Treasuries today e d u means putting risk into supposl c s in aper t i n edly safe government-backed All u toiletcp de nd 10% off y ts inleslus hear securities, and 2% –2.5% yields l p y ou 2 ni er ap 6 mon ths if y r first don’t justify taking such risks. ou men er. and Aalnl du wtaotileittip z tion is h 1th n 100% y %booroc 2-pl staerless 6 mo6nm ffff yhouurre!first Indeed, today’s interest rates thosnifthys wa tizer. oif u d y m o m e u n n are as low as they’ve been since i tehnistiobnr a otchhisuraed tion san !! the post-World War II period. Subsequently, long-term government bonds returned barely 2% a year from 1951 through 1981, less than half the annualized rate of inflation, which was over 4%.

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If you have doubts about long-term Treasuries, what investments might provide steady income as well as a hedge against a potential stock market slide? Options range from dividend-paying stocks to shorter-term Treasuries to municipal bonds. No investment is without risk; longterm Treasuries have their strong points, but you should consider all the possible consequences of including them in a diversified portfolio. continued on page 69

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government bonds. Altogether, low inflation and a robust dollar

while intermediate-term issues lost only 2% and 1

Financial Management continued from page 67

Private Health Insurance Exc Private Health Insurance Exchanges Business Owners

T

for Business Owners

he public health insurance exchanges created under the Affordable Care Act have been well publicized. Another, not so well known option exists: private health insurance exchanges. The private entries are still relatively small; in late 2014, the Kaiser Family Foundation put total enrollment at 2.5 million people, including 700,000 retirees in Medicare plans. Yet, some observers see the private market expanding to as many as 40 million people by 2018. While public health insurance exchanges focus largely on individual and family plans, some of the private exchanges appeal mainly to employers. Owners of small companies as well as decision makers at medium-sized and large firms may evaluate the benefits of providing employee health insurance coverage through private exchanges. Multiple Choices

Unlike public exchanges, which are offered by the federal and state governments, private exchanges are run by a variety of companies. Sponsors include consultants, brokerage firms, even retailers. The constant is that these exchanges allow those seeking health insurance to go online and compare what’s available in a virtual marketplace.

publicized. Ano well known opti private health in exchanges. The p are still relatively in late 2014, the Family Foundat enrollment at 2. people, includin retirees in Medi Yet, some obs the private mark to as many as 40 Private health insurance exchanges can take many forms, but one likely structure is the defined people by 2018. contribution plan. Just as traditional defined benefit public health ins retirement plans have lost ground to defined contribuexchanges focus tion retirement plans, such as 401(k)s, so traditional The public health insurance individual and family pl employer health plansunder may be exchanges created thesupplanted by thedefined private exchanges ap contribution arrangements. Affordable Care Act have been well to employers. Owners o Here, the “defined contribution” could be the amount an employer gives its employees to shop for coverage on a private exchange.

Example: Melanie Wilson owns a small business with 25 employees. She enters into an agreement with a health insurance exchange managed by an employee benefits firm. Melanie’s employees will be able to go online and examine the offerings from three specified health insurers; each health insurer will make four different plans available. Employees can choose among the offerings as they’d choose among the investment options of a 401(k) plan. Melanie decides to allow each employee to continued on page 71

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Chevron  Quality  Lubricants  New   Source  Elite  Marketer  of   Source  Elite  Marketer  of  Chevron  Quality  Lubricants  Chevron  Quality  Lubricants  Complete  line  of  lubricants  for  all  industries:                 Chevron  Quality  Lubricants  Complete  line  of  lubricants  for  all  industries:                 Complete  line  of  lubricants  for  all  industries:                 Off  Highway  and  Construction,  On  Highway  Fleets,  Complete  line  of  lubricants  for  all  industries:                 Off  Highway  and  Construction,  On  Highway  Fleets,  Off  Highway  and  Construction,  On  Highway  Fleets,  Automotive,  Marine,  Railroad  and  Industrial  Plants  Off  Highway  and  Construction,  On  Highway  Fleets,  Automotive,  Marine,  Railroad  and  Industrial  Plants  Automotive,  Marine,  Railroad  and  Industrial  Plants  On  and  Off  road  diesel  fuel  ,  propane  and  heating  oil  Automotive,  Marine,  Railroad  and  Industrial  Plants  available  in  select  markets  of  our  service  area  On  and  Off  road  diesel  fuel  ,  propane  and  heating  oil  On  and  Off  road  diesel  fuel  ,  propane  and  heating  oil  available  in  select  markets  of  our  service  area  On  and  Off  road  diesel  fuel  ,  propane  and  heating  oil  available  in  select  markets  of  our  service  area  Experienced  Sales  and  Customer  Service  personnel  available  in  select  markets  of  our  service  area  Experienced  Sales  and  Customer  Service  personnel  Experienced  Sales  and  Customer  Service  personnel  ready  to  help  you  with  your  lubricant  needs.  Experienced  Sales  and  Customer  Service  personnel  ready  to  help  you  with  your  lubricant  needs.  ready  to  help  you  with  your  lubricant  needs. Â

800-554-4557 ready  to  help  you  with  your  lubricant  needs.  800-554-4557 800-554-4557 www.oceanstateoil.com 800-554-4557 www.oceanstateoil.com www.oceanstateoil.com www.oceanstateoil.com

Serving the Bonding and Insurance needs of the N.E. construction industry for over 40 years.

Adam DeSanctis Gregory Juwa James Axon Michael Carney Wilder Parks Michael Gilbert Bryan Juwa David Boutiette Paul Patalano Dick Caruso Jonathan Duggan Eric Pratt

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Financial Management continued from page 69 spend up to $300 a month on health insurance. If Bob Smith picks a plan that costs $400 a month, Bob will have to contribute the extra $100 each month; if Claire Jones picks a plan that costs only $250 a month, Claire might use the extra $50 for some other type of coverage, such as disability insurance. If handled properly, Melanie’s outlays will be treated as tax-deductible business expenses for the company, while her employees will not have to include the $300 monthly allowance as taxable income. That’s how today’s standard health insurance plans are taxed.

Cost Control Advocates of private health insurance exchanges say that they can help employers control expenses and reduce paperwork responsibilities. Employees not only get to choose a plan that fits their needs and finances, they’ll also gain an appreciation of how much of the health care costs employers are bearing. Nevertheless, there can be drawbacks to private exchanges. Coverage won’t qualify for the subsidies that public exchanges may deliver. The area is still new, so there’s not much of a track record to examine. Reprinted from CPA Client Bulletin. n

plainville, Ma (774)847-9046

Cape Cod, Ma (508)759-9990

Boston, Ma (617)269-4800

auBurn, Ma (508)832-3404

WoBurn, Ma (781)376-9636

Cranston, ri (401)461-8020

For all your construction supply needs l Soil Stabilization l Slope Protection & Erosion Control l Gabions l Pavement Maintenance

l Forming & Shoring l Rebar l Road & Bridge l Concrete Repair & Restoration

www.ahharris.com

APRIL, 2015

“BUY FROM THE ADVERTISERS IN CONSTRUCTION OUTLOOK”

71


E.H. Perkins Construction, Inc. & Subsidiaries P.O. Box 301, Wayland, MA 01778 (508) 358-6161 • (781) 890-6505

-PLANT LOCATIONSQUINN-PERKINS S & G CO. Burlington (781) 272-0200 PANDOLF-PERKINS CO. Sterling (978) 422-8812 • (800) 339-3389 KANE-PERKINS CO. Hudson (978) 562-3436 • (800) 287-3436 GRAVEL • SAND • STONE FILL AND LOAM BITUMINOUS CONCRETE (PAVING) READY-MIX CONCRETE PRECAST CONCRETE PRODUCTS

E

H

P

Equal Opportunity/Affirmative Action Employer

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Advertisers’ Index ATS Equipment, Inc. .............................................................4 Adler Tank Rentals...............................................................33 American Shoring, Inc..................................... Ins. Back Cvr. Aon Construction Services Group........................................11 Boro Sand & Stone Corp......................................................62 Dennis K. Burke, Inc............................................................68 C&S Insurance Agency, Inc...................................................6 Concrete Systems, Inc..........................................................50 Dagle Electrical Construction, Corp................................... 40 Darmody, Merlino & Co., LLP............................................35 Dedham Recycled Gravel.....................................................48 DeSanctis Insurance Agency, Inc. .......................................70 Dig Safe System, Inc............................................................38 The Driscoll Agency ..............................................................9 EJ......................................................................................... 44 Eastern Insurance Group, LLC........................................... 60 Eastern States Insurance Agency, Inc..................................27 Eastpoint Lasers, LLC..........................................................45 T. L. Edwards, Inc................................................................69 Excellence In Safety Inc.......................................................65 Ferguson Waterworks.......................................................... 66 Foley Carrier Services, LLC..................................................5 Geod Consulting, Inc............................................................68 L. Guerini Group, Inc...........................................................62 HD Supply Construction & Industrial White Cap...............20 HD Supply Waterworks..........................................................2 A. H. Harris & Sons, Inc. ....................................................71 Hinckley Allen, LLP............................................................10 John Hoadley & Sons, Inc....................................................43 JESCO...................................................................................57 P. A. Landers, Inc.................................................................30 Lawrence-Lynch Corp......................................................... 64 Lorusso Corp....................................................................... 66 Lorusso Heavy Equipment, LLC.........................................34 MBO Precast, Inc...................................................................7 Mabey, Inc............................................................................45 Mass Broken Stone Company.............................................. 64 Milton CAT...........................................................................26 Norfolk Power Equipment, Inc.............................................13 North East Shoring Equipment, LLC...................................51 Northland JCB......................................................................31 NorthStar Insurance Services, Inc.......................................18 Ocean State Oil.....................................................................70 Our Outhouses, Inc...............................................................67 Palmer Paving Corporation..................................................62 E. H. Perkins Construction Co., Inc.....................................72 Podgurski Corp.......................................................................5 E. J. Prescott, Inc..............................................Ins. Front Cvr. Rain For Rent-New England.................................................22 Read Custom Soils .............................................................. 64 Rogers & Gray Insurance Agency, Inc.................................32 Salem Dental Arts, PLLC.....................................................28 Schmidt Equipment, Inc.......................................... Back Cvr. Scituate Concrete Products Corp..........................................42 Shea Concrete Products........................................................12 Smith Print............................................................................70 Starkweather & Shepley Ins. Brokerage, Inc.......................36 Ti-SALES, Inc. ....................................................................71 Albert J. Tonry & Co., Inc....................................................68 TrenchTech Inc........................................................................8 United Concrete Products, Inc. ............................................58 United Rentals Trench Safety.............................................. 46 The Vellano Companies, Inc................................................15 C. N. Wood Co., Inc. ............................................................14 Woodco Machinery, Inc.......................................................56

“BUY FROM THE ADVERTISERS IN CONSTRUCTION OUTLOOK”

APRIL, 2015


from Design to Delivery American Shoring is the Leader in High Quality, ModularTrench Shoring A complete line of heavy duty and light weight aluminum or steel trench shoring is available for all your needs. Our staff is waiting for your call with professional advice to recommend the best specific product for your project. Field service support and supervision available with on site assembly and take down. Inquire about our Competent Person, Confined Space & OSHA 10 training classes. All systems are manufactured in the USA.

207 Lake Street, Newburgh, NY 12550

1.800.407.4674 www.americanshoring.com E-Mail us at

sales@americanshoring.com In New England

SALES • RENTALS • SERVICE REPAIRS • TRADE-INS RECERTIFICATION

American Shoring of Massachusetts, Inc.

226 Cherry Street Shrewsbury, Mass 01545

508-842-2822 Fax: 508-842-2824


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City life isn’t for everyone. But the new 135G and 245G Excavators couldn’t be more at home. . But the new 135G and 245G Excavators couldn’t be more at home. Their reduced-tail-swing configuration opens up a TCihtyeliifreriesnd’ut fcoer dev-etrayiol-nsew ing configuration opens up a wide range of possibilities, making congested wide range of possibilities, making congested jobsites and working around obstacles a welcomed challenge. Coupled with their EPA-certified jInotbersim iteTsiear n4 denwgionerks,isnhgorat-rtohuronwdloowb-esftfaorctlecosnatrowlse, lacnodmspeadciocuhsa, qllueinetgcea.bsC, othuepy’llel kdeewpiytohutwhaenirtinEgPtAo-scteayrtoinfitehde jobsite, despite how easy Itnhetyerairm e toTiloeard4uepnag ndingeest ,toshthoertn-etxh t roonw e. Clo onwta-cetfufo s trotdcaoy.ntrols, and spacious, quiet cabs, they’ll keep you wanting to stay on the jobsite, despite how easy they are to load up and get to the next one. Contact us today.

Contact us today! Contact us today!

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