Shantel Lipp - SHCA President
by Shantel Lipp Shantel Lipp

Diesel Fuel Adjustments

The construction season is underway, and work is in full swing. While that work moves ahead, the realities of inflation have been unavoidable.

Since the start of the year, the price of diesel has climbed substantially. Continuing to pay that much more for fuel has been difficult for many of our members under the existing contracts they have with the Ministry of Highways, which has estimated the increase to be around 69 per cent.

Shantel Lipp

Now, there is a conversation happening about what to do about this situation. Recently, the Ministry of Highways presented our association with some proposed adjustments to the fuel escalation clause. Since the start of the year, the ministry has been reviewing prices and policy and exploring potential options for updating the policy and the budget impacts of those possible updates. Then, in late March, there was a standard practice bulletin posted that directed that interim diesel fuel adjustments be calculated and applied monthly to improve contractors’ cash flow. But, at that time, no formal changes were applied to the policy. 

Then, in June, the ministry began a process to review options – with industry – for updating and expanding the diesel fuel adjustment. The risk associated with the cost of diesel is shared by the ministry and contractors, but not all types of work or components of work are eligible for the adjustment. Not all diesel consumed on a project is included. 

This shared risk will continue, but the ministry is open to taking on a greater share of the risk. The ministry has proposed expanding the scope of work to include additional types of work. It is also looking at the consumption rate and applying the existing consumption rates more broadly in some areas of work. It is also looking at better options to address fuel consumption for haul. Then, there is payment. The ministry is using a monthly adjustment to apply interim adjustments in advance of a final calculation.

While the ministry has some ideas, it had asked for industry to provide input on a few questions:

  • Are the work types eligible for the diesel fuel adjustment appropriate?
  • Are the proposed and existing consumption rates relevant? Do they adequately reflect the nature of the work being performed?
  • Is the method of calculating and applying the diesel fuel adjustment sufficient “as is”?

Our industry has reviewed the proposal and a number of SHCA members provided additional improvements they would like to see beyond what the ministry has proposed.  

We provided actual figures and examples of how the industry has been impacted by the escalation in diesel fuel. We’ve also asked for compensation for our members that currently provide asphalt concrete products that go into making the binder materials for crushing, micro-surfacing, paving and more. Then, there are the various types of work that also consume diesel fuel that the ministry didn’t include in its presentation, such as rock excavation and hauling used for dirt excavation. Finally, we will be working with the ministry on revising the industry consumption rates to reflect more realistic figures. It should be reasonable and fair to both industry and government. The deadline for comments was July 8.

The ministry is aiming to complete any updates to the diesel fuel adjustment by Aug. 15 this year in order to include them in all fall tenders. Changes through the supplemental agreement will be applied retroactively to the active contracts back to Jan. 1.

I know the current situation is not sustainable for our industry and this is a crucial conversation for many of our members whose future depends on this situation being addressed by government. We appreciate all of you who have contributed your input so that we can provide government accurate and meaningful information to ensure changes address your real need. 

by Shantel Lipp Shantel Lipp

Champions of Infrastructure

Shantel Lipp

Infrastructure needs its champions, and the Saskatchewan Heavy Construction Association is proud to be one of them. Recently, our chair and some of our board members had the opportunity to attend a dinner meeting in Saskatoon sponsored, in part, by the SHCA.

The Canada West Foundation, which released the Shovel Ready to Shovel Worthy report last month, was in Saskatchewan for its board meeting, bringing together those who understand what Western Canada offers the world. Trade infrastructure is how we make sure that what provinces like Saskatchewan produce can be transported from here to everywhere that buys what we sell. The SHCA champions for long-term investment into trade infrastructure through its relationships with the Western Canadian Roadbuilders as well as the Civil Infrastructure Council among others, such as the Canada West Foundation.

These relationships are how reports such as the Shovel Ready to Shovel Worthy report are produced and promoted. A report like that creates the narrative for industries like ours to have the conversation with elected officials, and industry leaders at all levels about working together to capitalize investment into trade corridors.

A report like Shovel Ready to Shovel Worthy is where compelling data is pulled together and presented to prove our case. A report with such data is at the core of our collaboration on coordinated campaigns that target the federal government to carve out explicit funds for trade-related infrastructure. The contents of the report will be discussed at meetings with Saskatchewan’s new Minister of Highways, Jeremy Cockrill, as well as the new chief of staff, Brayden Fox, who I am excited to work with going forward.

It is the focus of messages our industry and association send out to the public through radio, social media and publications to get people thinking about the value Saskatchewan’s trade infrastructure brings to our economy and the people of this province.

It is what we bring forward to conversations with groups such as the City of Regina, the City of Saskatoon, SUMA, SARM, the Saskatchewan Trucking Association and chambers of commerce. We encourage municipally elected officials, business owners and administration to recognize how trade benefits from this infrastructure and to echo our message about investment in it.

If you can’t move it, you can’t sell it. That’s a message that resonates with everyone. Between opportunity and crisis, Saskatchewan and Canada face a choice. We have opportunity but we need a plan to capitalize on it over the long term to rebuild this country’s trading reputation. Helping those who make decisions about funding trade infrastructure to recognize that opportunity and choose to support strategic investment that betters this country is why SHCA works with other champions.

Shantel Lipp - SHCA President
by Shantel Lipp Shantel Lipp

A Disappointing Budget

As you can imagine, I get excited for the release of the spring tender schedule each year, but when I saw what was contained in the schedule this spring, my enthusiasm cratered.

But as tough as I am finding it to believe there are basically no new projects, I can’t imagine the devastation being felt by those living in the Langenburg/Spy Hill/Rocanville/Moosomin area. There are people in that area who are still grieving nearly a year after a tragic rollover on Highway 8 while they fear for their own safety travelling on it today. 

Two young women, who were a couple of weeks away from graduating from McNaughton High School in Moosomin and were ready to take on the world, were travelling south of Langenburg together on Highway 8 in early May of last year.

After their vehicle left the highway, RCMP were called around 4 p.m. that Thursday to respond.

The officers should not have found what they did that day. Both young women were still in the vehicle. One was taken to hospital with injuries. The other did not survive the crash. She drowned after the vehicle rolled and landed upside down in just inches of water after it left the road. 

In the days following, counsellors were available to students and staff at McNaughton High School. Borderland Co-op in Moosomin, where both young women worked, also provided support for their staff with the food store closing early the day after the crash so employees could grieve.

The incident was investigated by an RCMP Collision Reconstruction Analyst. People in the area, however, thought about the condition of the highway where this occurred and continued their conversations about their own experiences on it as they grieved their loss.

Drivers in that area call Highway 8 treacherous, which is absolutely not an exaggeration after some lost wheels driving it due to the highway’s condition. The pavement is broken up and there is heaving and potholes along it. The narrow road has no shoulders or turning lanes. 

Those turning left off Highway 8 to get to Carlton Lake Regional Park or access one of the secondary grid roads often must come to a full stop on the highway. When farmers or truckers use Highway 8, it becomes impassable for other drivers. But to get to Langenburg, that is the highway you must take – to buy groceries, to make it to medical appointments, to go to school and to get to work among many more necessary daily activities people living there must do. 

People in Saskatchewan are not willing to accept there are limits on what the government can do given the number of kilometers of highway there are in the province to maintain.

Then, there is the economic activity that depends on this pitiful highway. It is a stretch that serves three potash mines (Mosaic K2 and K3 plus Nutrien), two large company farms (Norenda Farms and Hruska Farms), a farm machinery business (Bridgeview Manufacturing) and a canola crushing plant and refinery (Bunge Harrowby across the provincial border in Russell, Man.). 

Think of all the heavy haul trucks and equipment that would travel this highway to serve these businesses!  They rely on that highway, in part, because a section of it links the TransCanada to Highway 16.

Action was needed to ensure something was done to make this highway safe and people living and working in the area stepped up to make this known. People who drive that highway to get to work daily have pressed numerous employees in the Ministry of Highways to improve the safety of Highway 8 south of Langenburg. 

They talked to their MLA, Warren Kaeding, who assured them in November that Highway 8 would be fixed during the 2022 construction season. Yet, where is the project in the spring tender schedule released in late March?

Highway 8 was built in 1965 for primary weight at that time and has not seen a significant upgrade since then. People in the Langenburg/Spy Hill/Rocanville/Moosomin area have contacted Premier Scott Moe, Highways Minister Fred Bradshaw and their MLA, Warren Kaeding, to have it explained to them why they have been ignored in this spring tender. 

I want to elevate their concerns by sharing them with you to press the provincial government as well. This is a prime example of why it is unacceptable for the Saskatchewan government to keep repeating what it has spent on highways in recent years. People in Saskatchewan are not willing to accept there are limits on what the government can do given the number of kilometers of highway there are in the province to maintain. 

There is still so much to be done to ensure that people travelling through Saskatchewan are safe as they work to grow this province’s economic output and transport what we produce to the world. Their children should have safe highways to travel on to get to school and their activities. This is not the time for the government to rest on its laurels as families worry and those in businesses stress about travel close to home. 

Broken pavement and potholes make many routes treacherous
Shantel Lipp - SHCA President
by Shantel Lipp Shantel Lipp

Shovel Ready to Shovel Worthy

Canada can continue to spend on infrastructure that members like you build and maintain. 

But investing in infrastructure that supports trade would be a better use of that money and a new report by the Canada West Foundation explains why. The report is titled From Shovel Ready to Shovel Worthy.

Several industry and trade groups across the country and here in Saskatchewan are sharing why this report matters to Canada’s future, including the Western Canada Roadbuilders & Heavy Construction Association (WCR&HCA), Saskatchewan Trade and Export Partnership, Business Council of Canada, Canadian Chamber of Commerce, Canadian Construction Association and Export Development Canada. The Saskatchewan Heavy Construction Association is also on that list. 

The world needs what Canada produces and Saskatchewan, in particular, has a lot to offer the world – but producing it is not enough. We must move it through our country and beyond its borders. 

We need the rest of the world to have confidence that what Canada produces for export will be moved through the country efficiently and reliably so we, as a trading partner, are competitive in the world. 

For more than a decade, those in the know have watched Canada spend on projects that are ready for construction. Instead, a better use of that money would be to invest in projects that will provide a return on that spending by improving Canada’s supply-chain competitiveness. 

For every $1 invested in trade transportation infrastructure, the GDP boost is $1.30, often in the same year. This is one of the messages being shared by Chris Lorenc, the president of the Manitoba Heavy Construction Association, who also serves as president of the WCR&HCA, as he promotes this report’s importance.

Canada doesn’t need to start from scratch when developing a plan for investing in shovel-worthy projects. The shortcut is to take the best parts of already established national plans developed by Canada’s competitors. 

We need to look at their success and build upon them by combining those with Canada’s own successes, such as the Asia-Pacific Gateway and Corridor Initiative and Transport Canada’s current Regional Transportation Assessments.

There are seven points the report makes about how to build Canada’s first national plan for trade corridor infrastructure. They are:

  1. Define Canada’s national trade corridor network to put all levels of government and industry on the same page.
  2. Bring the private sector to the table as an ongoing contributor of sophisticated supply chain expertise and front-line operational experience to complement the best features of public-sector policy.
  3. Apply criteria of national significance to guide the planning process and decision-making. 
  4. Develop an “evergreen,” decades-long pipeline of national infrastructure projects.
  5. Undertake regular assessments of infrastructure projects in relation to established criteria.
  6. Begin a new forward-looking approach to the collection of data and use of forecasting and modelling tools.
  7. Coordinate the communications of domestic infrastructure working groups and aggressively share progress on the above recommendations with industry and foreign customers.

In the next issue of Think Big, which comes out this summer, there will be a deeper dive into this report. 

Here in Saskatchewan, we have seen major investments being made by the private sector that will further develop this province’s trade potential by putting money towards producing commodities the world requires and adding value to those commodities. Saskatchewan is on the world map because of announcements such as BHP approving $7.5 billion for the Jansen potash project to the numerous canola crush plants that were announced to the resources in high demand being developed in this province, including lithium and helium. 

That is all good news, but we must also pay attention to how we are going to move those commodities from this province through Canada and beyond our borders. This report and our conversation as an industry about it will bring attention to the need for Canada to develop a national plan for developing and maintaining our trade infrastructure. I appreciate your interest in moving that conversation forward for the benefit of our industry, province and country. 

Shantel Lipp - SHCA President
by Shantel Lipp Shantel Lipp

Reacting to the 2022–23 Provincial Budget

Like you, I am concerned about what the provincial budget for 2022–23 DID NOT contain for work during this budget year.  

With the spring tender now out, it has been confirmed that there is no money for new projects. Virtually all the work available from the Highways ministry has already been tendered. 

I don’t need to tell you what is wrong with that, but it is something the public should be aware of so they can hold this government to account. What is not in the budget – and the message that sends – contradicts what the provincial government is telling voters about wanting to grow the economy past pre-pandemic levels.

The minister keeps referring to the government’s record of spending on highways. This is not in line with what the provincial government is saying about investing to grow the province. 

Spending is a reaction to what’s happening now. Investment brings business opportunities to Saskatchewan and requires thoughtful planning. The two aren’t the same. 

Private investments being made in this province are being promoted by the Saskatchewan government as evidence of its success. Those who make the decisions about private investments would be wise to wonder how committed this government is to truly supporting growth. 

Without critical infrastructure – such as roads and highways — improving and expanding, growth in this province will be stifled. For a province dependent on trade that moves so much of our exports to international markets by shipping them out of province by trucks, it makes little sense why there is not more provincial investment in highways. 

Saskatchewan is being looked at to produce more. Two of the world’s largest agricultural producers are at war, putting pressure on other countries, like Canada, to meet the world’s needs. We know potash producers are ramping up production to meet the needs of agricultural producers. Oil and gas production is also affected by the conflict and Saskatchewan is already seeing greater interest in drilling here with the April auction for drilling rights bringing in 10 times the revenue generated in last year’s April auction. 

There is a plan for highways and it hasn’t been forgotten by the province. The budget once again references the Saskatchewan government’s 10-year Growth Plan, which came out in late 2019 to cover the decade between 2020 and 2030. The goals listed for highways in that 10-year plan are to build and upgrade 10,000 kilometres of highways, among other work. 

During the 2020 construction season, more than 1,030 km of improvements were made. During the second year in the growth plan, more than 1,350 km of improvements were made. (In the 2021 Fall Tender Plan, there was $157.3 million in new highways projects. The 2021 Spring Tender schedule had new projects with an estimated value of $85.4 million.)

With nothing new this year, that means during the remaining six years in the plan, the provincial government has to average near 1,300 km a year to meet that target. I know, as an industry, you have the capacity to do that work, but it remains to be seen if that level of investment will occur. 

The uncertainty and inconsistency burdens our industry. I hear how it makes it hard for you to know how to prepare for your futures when, from one year to the next, the amount of capital investment can swing up and down by tens of millions of dollars.  The Saskatchewan government announced $846 million for the Ministry of Highways for 2022–23. This includes a capital investment of $452.5 million, which is nearly $70 million down from last year. 

This inconsistency affects your ability create jobs and retain employees in the industry. It makes decisions about investing in equipment difficult. That is a message I will continue to bring to government. 

We have a commitment from the province that we can deliver this message so it is heard by the treasury board. I look forward to that opportunity and will continue to keep you informed about how we proceed from the disappointment that was this year’s provincial budget.

by Shantel Lipp Shantel Lipp

WCR&HCA Planning for In-person

Who else is ready to get together to talk business as well as socialize with others in our industry?

If your answer is yes, I can tell you that you are not alone and that feeling is being felt across Western Canada. 

From what those with the Western Canadian Roadbuilders and Heavy Construction Association (WCR&HCA) are hearing, there is an appetite for a conference. There is enthusiasm from those who have attended their conferences in the past to attend such an event again. Plus, past sponsors share that they too are ready to support a conference.

With that kind of feedback, a decision was made by the WCR&HCA board in early November that planning for an early 2023 conference in Waikiki, Hawaii should proceed.

The last time the WCR&HCA held a conference was in 2017. As you know, a lot has changed since then and this conference is a good opportunity for members from our industry across the four western provinces to meet and discuss what is important.

The Western Canada Trade Gateways & Corridors Initiative is one such matter. Simply put, Canada’s economy depends on trade, which requires infrastructure to move goods. The WCR&HCA is calling for the federal government to increase its funding of infrastructure that enables trade. 

The investment would be worth it. This initiative is looking at the future and the needs that must be met in order to seize opportunity. 

Canada must diversify its trade markets to become less reliant on the U.S. The middle class in Asia is growing at a pace that will be beyond the ability of its economy to support, but the same growth is not expected of the U.S.

Canada should be ready to trade with those countries that want what Western Canada has to offer in the quantities they will require. But to do so requires scaling up Canada’s infrastructure, particularly in the West. This includes marine, road, rail and air in the gateways and trade corridors that will allow us to move freight and people that are significant to trade with Asia, but will also boost trade here in Canada as well as across the North American continent. 

The WCR&HCA is working with federal and regional partners – including the Canadian Construction Association, Business Council of Canada, Canadian Manufacturers and Exporters and the Canada West Foundation – to promote the Western Canada Trade Gateways & Corridors Initiative. They are pressing the federal government to substantially increase investment within the National Trade Corridors Fund, which in 2021’s budget was $1.9 billion.

However, the WCR&HCA states that at least $10 billion needs to be contributed by the federal government if western provinces are to see regional corridors in this part of the country strengthened in order to seize on this trade opportunity. And it’s not just the federal government who is being encouraged to invest. The initiative goes beyond the feds to motivate private investment in Western Canada’s infrastructure as well. 

While planning for the conference is still underway, given the importance of this initiative and the consistent activity by the WCR&HCA around it, it is hard to imagine it not being a vital part of the conversations that take place during their event.

For this reason, and many more, I hope you are among those pleased to learn that this conference has been approved in principle. It’s important for those of us in this industry to gather together to talk about the business, but to also find time to enjoy one another’s company. Here’s to this event going ahead in 2023!

by Shantel Lipp Shantel Lipp

President’s Message – Upcoming Events in April

While there is still plenty of snow on the ground this month, it won’t be long before it has melted away and another busy road construction season is here.

Between now and then, there are some back-to-back April events I’d like to invite you to join. One is through a brand-new partnership that the Saskatchewan Heavy Construction Association has formed and another is a tradition I look forward to continuing this year.

The first event I’d like to invite you to is possible because of a partnership that has been developed between SHCA and the Asphalt Institute, an association that promotes the safe use, benefits and quality performance of petroleum asphalts. The Asphalt Institute describes itself as the international trade association of petroleum asphalt producers, manufacturers and affiliated businesses. One of its areas of strategic focus is to support its members with technical leadership and educational expertise.

Through this partnership, a training session for Pavement Inspection Certification will be taking place April 6–7. The course will run from 8 a.m. to 4 p.m.

These 16 hours of instruction will provide valuable information that will help owners and employees understand how to construct high-quality asphalt pavement by ensuring that every stage of the operation includes effective inspections.

This training would be useful to new employees who are learning the basics of asphalt construction and the inspection duties that are part of it, so as you are hiring for this upcoming construction season, keep this opportunity in mind for those people.

The certification will also be beneficial for those with more road construction experience to review their knowledge of all aspects of asphalt materials and paving. Employers who have their staff take this training can be assured that those doing asphalt inspection for them have proven their competency to do these duties so the pavement they construct is high-performing.

The course will be open to members and non-members who wish to receive the certification. It is a great opportunity for contractors to elevate their staff’s knowledge and skills as well as for consultants and Ministry of Highways employees inspecting paving projects across the province to raise the standard and quality of our pavements. It’s my hope that more training sessions like this can be offered in the future.

Then, a few hours after the course wraps up, the SHCA convention festivities will kick off at 6 p.m. with a welcome reception.

Over the two days of the convention at the Delta Bessborough Hotel and Convention Center in Saskatoon, we will be hearing from two wonderful speakers, Darci Lang and retired Colonel Mark Gasparotto.

Darci will bring her message of “Focus on the 90%” to help others find the positives at work, rise above adversity and triumph in their lives.

Meanwhile, Mark is passionate about self-reflection and personal development. He emphasizes results, teamwork and effective communications, which is how he was able to elevate to the upper ranks of the Canadian Armed Forces.

And since the event is being held in the spring, which is when SHCA’s annual general meeting is typically held, these two events will be combined. Finally, the convention will wrap up with the Chairman’s Banquet.

Details about registering for both the training and the convention will be sent out the week of Feb. 13–19.The deadline for booking hotel rooms is March 7, so make your plans soon to join us in Saskatoon. I look forward to seeing you there!

by Shantel Lipp Shantel Lipp

Connecting with Government

Thank you to everyone who came out to the MLA reception hosted by the Saskatchewan Heavy Construction Association (SHCA) at the Legislative Building on Nov. 1.

We had a solid turn-out of members and MLAs from both the Saskatchewan Party and the NDP. Everywhere you looked in the room, you could see people talking to one another, asking questions and sharing news as they got acquainted. Throughout the room, information was available about the economic impact of the heavy construction industry, and how trade infrastructure ensures the province remains competitive. MLAs were invited to take this information with them. 

The chairman of the SHCA, Harley Diederichs, spoke to reception attendees about the industry and introduced Highways Minister Fred Bradshaw, who also spoke. 

The SHCA held this reception because it is important for ministers and MLAs to hear from industry representatives. On behalf of the association, I stay connected with the provincial government to advocate for the industry. But, while I bring forward issues that matter to our members, what often sticks with politicians is hearing personal accounts of how their decisions affect constituents’ livelihoods and well-being. 

Politicians from both the Saskatchewan Party and the NDP need to hear how your business has a positive effect on the provincial economy. Tell them stories about how government infrastructure investment allows businesses like yours to create good jobs. 

Remind them of how the infrastructure you build and maintain helps Saskatchewan commodities move through the province, to other provinces, and to ports to reach international markets. Your work connects the work of so many industries to strengthen Saskatchewan’s economy. 

Describe how your business contributes to local economies through paying for hotel rooms, restaurant meals, gas and more, when your employees travel to the communities where you do your work. Your work makes it possible for families to travel through the province for activities, sports, vacations and more.

Some MLAs are new to their role and others have held their seat for numerous terms. Some need to be introduced to the heavy construction industry, while others need to be reminded of its relevance. All provincial politicians can benefit from hearing your story, directly from you. I encourage you to register and attend the next time we have such an event. 

Politicians from both the Saskatchewan Party and the NDP need to hear how your business has a positive effect on the provincial economy.

by Shantel Lipp Shantel Lipp

Opportunities to Connect

Together, we are better. Now that we are able to host and attend events, we have a few coming up that offer all our members great opportunities to advance their interests.

Mark your calendars with a couple of events this November!

The first is the MLA Reception that the Saskatchewan Heavy Construction Association (SHCA) is hosting on Nov. 1 from 5 to 7 p.m. This event is your opportunity to meet with provincial MLAs from both sides of the legislature to talk to them, face to face, about your business as well as the industry. 

Whatever insights, issues or topics you think these MLAs need to recognize is up for discussion when we get together in Room 218 at the Legislative Building in Regina. Encourage other members to attend. The more people we have out, the more we can amplify the relevant messages about our industry. 

Please pre-register if you are planning to attend this reception. The SHCA needs to provide the legislative staff with a list of those attending. To pre-register, please contact traceyk@saskheavy.ca or slipp@saskheavy.ca. The earlier you register, the better!

The second event is the SHCA Fall Convention, which is set for Nov. 25-26 in Saskatoon. For two days, we will gather at the Delta Bessborough Hotel and Convention Centre to hear engaging speakers and participate in conversations about our industry. 

The Chairman’s Banquet will take place on Friday evening. New this year is a maximum capacity of 300 delegates. That makes early convention and room registration extra important! 

Registration links are now open and available for the SHCA room block.  More details about the convention will be released as we move towards November. 

Events like these are important to our members because they help develop and strengthen the voice of the association. Gathering to share our experiences, ideas and suggestions helps our members recognize and realize improvements and opportunities. It is how our members can find and form the connections that make their businesses and this industry even better. 

I look forward to seeing each and every one of you at these events and learning more about your current interests and ideas, so I can best represent you and our industry. 

Now that we are able to host and attend events, we have a few coming up that offer all our members great opportunities to advance their interests.