Two veterans of the Ontario construction scene with special expertise in contracts and tendering issued a plea for simpler and more standardized contracts during a recent Buildings Week webinar presentation.
Clive Thurston, former president of the Ontario General Contractors Association (OGCA), and Howard Doucette, director of pre-construction at ASCO Construction, hosted a Dec. 3 session billed as Tender Forms and the Tendering Process: What You Need to Know.
Thurston, now with Thurston Consulting Services, saved his most impassioned message for a call for governments to help contractors through what he predicts will be a very difficult period as work dries up during the second wave of COVID-19 entering 2021.
Costs are up, materials are becoming an issue and projects are running out, Thurston said.
“Many, many contractors and trades were living off money they had earned prior to COVID that is running out. What we are looking for is a robust release of projects, small, medium and large, to keep everybody working because the industry is being looked to as the key to keeping the economy going,” said Thurston.
“We need to see money flowing to the municipalities, we need projects of all sizes to keep people working. At present there are still challenges the provincial and federal politicians have failed to grasp. Disappointingly, most of the announcements have been money that was announced previously. That doesn’t help us get projects out the door.”
Returning to the subject at hand, Thurston and Doucette urged public owners to work more closely with contractors to improve tendering and contracting efficiency.
Thurston said the quality of tenders improves when there is collaboration.
“Work with us,” he said, citing successful caucusing between contractors and Infrastructure Ontario, the Toronto Transit Commission and the Cities of Vaughan and Milton, Ont. Milton is a growing town with enlightened executives who worked with the OGCA to bring efficiencies to its tendering process, Thurston said.
“They haven’t had a problem in years and they get good bidders and good prices on a consistent basis — isn’t that what we are looking for?” he asked.
The panellists argued that simplifying the tendering process leads to less confusion and wasted time. Doucette suggested owners should invite GCs to sit in on the closing process to offer comments and point out how certain measures are a waste of time.
Electronic tendering has improved efficiency but there are still more improvements that can be made.
Owners should simplify, shorten and standardize, Doucette suggested, mentioning unnecessary options, subtotals, multiple closing sheets and even excessive use of Roman numerals in tenders as irritants to contractors.
“Can we make it better? We can always make it better,” he said.
Owners tend to abuse the addendum process, Doucette said, with apparently random deadline dates for questions to be submitted and other processes that could be standardized. It had gotten to the point, he said, that in over 95 per cent of cases the closing date for tenders gets extended.
Another problem is that owners are getting away from tried and true CCDC contract documents, Doucette said. The standard forms have been eroded as owners have tried to deal with new situations and the new clauses have remained. It’s time to return to the basic forms where possible, Doucette said.
The length of the acceptance period is also an issue, Doucette said, with variations between jurisdictions causing confusion and concern for contractors.
The longer the acceptance period, the greater the likelihood that conditions might change, he said, something that is a greater fear during the pandemic.
Shorter periods mean better pricing. In one recent case, an owner insisted on a 150-day award period, multiple times the ideal, Doucette said.
“I think owners would get more value for their money by trying to keep this as short as possible,” he said.
Thurston criticized aspects of the growing trend among owners to prequalify bidders. In one case, an owner required GCs bidding on a recreation project to have a proven track record building pools.
The problem was, no general contractors build pools, he said. The lesson is, overly restrictive prequalification eliminates competition which leads to higher prices, Thurston said.
“Be very careful what you are setting as a prequalification because you may just do yourself out of a lot of bidders,” he said.