July 23, 2012

Toronto considers adopting CCDC2

KELLY LAPOINTE

staff writer

A recent report to a City of Toronto committee recommends the adoption of CCDC2 but that could prove useless if the city’s procurement system is not fixed, says the president of the Ontario General Contractors Association (OGCA).

“I think it’s a very, very positive step but unless we fix the procurement side, the City of Toronto is still going to pay more than they should, they are still going to lose good bidders and the system is not going to work,” said OGCA president Clive Thurston.

He said it’s a problem not just in Toronto, but in many jurisdictions where procurement has been taken out of the hands of the construction professionals.

“That would be fine if both sides were talking to each other or there was some understanding of both sides, but there isn’t and we’re having this problem across the province.”

After months of cooperation, the OGCA and the Ontario Association of Architects recently released a report recommending the adopting of CCDC2 along with two sets of supplementary conditions — one for facilities and one for linear construction — to the City of Toronto.

“This is a major, major client and I think the success of what we did with them and getting them to consider adopting CCDC2 and a set of supplementaries that we can understand and move forward with is a tremendous step forward,” said Thurston.

“I hope that does influence other municipalities to not be so afraid of talking to us and to adopting CCDC2.”

He said the supplementary conditions balance the risk better. It was important to keep the contracts streamlined as some CCDC2 contracts can have supplementary conditions longer than the 30-page document itself.

“We worked very hard to get it down to a minimum number of supplementaries that address the City of Toronto issues. There may be others from time to time, depending on the specific type of project, that’s fine but they shouldn’t remain in the document,” said Thurston.

Neither side got exactly what they wanted through negotiations, but Thurston said the remaining issues will only require minimum fine tuning and that both sides have a commitment to continue talking.

Overall, he was pleased with the process and that it yielded a balanced and fair set of conditions. As always, it is still up to each contractor and architect to decide if these conditions meet their risk model, he noted.

In 2009, the Residential and Civil Construction Alliance of Ontario, who helped in the consultations with Toronto, commissioned a report, Towards A Fair and Balanced Approach: A Commentary on Government Procurement of Construction in the GTHA, that said approximately $2.6 billion is spent annually on construction by federal, provincial and municipal governments, their respective boards and agencies, as well as by school boards, universities, community colleges and hospitals.

These governments in the GTHA (Greater Toronto and Hamilton Area) may be paying an additional $500 million a year more than is necessary for construction projects because of onerous contracts and excessive risk transfer to contractors, found the report.

Thurston said the keys moving forward will be continued consultation and fixing Toronto’s procurement process.

The OGCA plans to reach out to the city and hopes to enter into a similar consultation on procurement.

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