Don’t miss out on rural municipal contracts — secure an agreement to bond
BY KELLY WATERHOUSE
Opportunities are increasing for landscape contractors to compete for major projects in rural municipalities, says Sean Kelly, assistant professor of landscape architecture at the University of Guelph’s School of Environmental Design and Rural Development. Yet, it seems the local landscape contractors are unable to compete for tenders. It’s not because the skills are lacking, says Kelly. It’s because landscape companies need to be bonded to bid on these jobs.
Community infrastructure is becoming big business. Kelly should know — as co-owner of Stempski Kelly Associates Inc. in Elora, Ont., his firm has been involved in many community projects, from designing skateboard parks and green spaces to creating entire streetscapes and branding township identities. His work involves dealing with local contractors who have secured the bonding requirement to meet the municipality’s guidelines.
HIRING LOCAL TRADES
Roadwork contractors are often awarded the outdoor contracts. They have experience dealing with the municipality, and have secured bonding. But as a landscape architect, Kelly wants to see his fellow landscapers involved — he feels it’s their specific skill sets that make these projects successful. He also believes it is important for community projects to hire local trades. In small townships, the work is as much about building community pride and spirit as it is about completing a project, says Kelly. The more the community is involved, the better.
“We’re seeing much more opportunity for landscapers in a climate for roadwork contractors. There is a perfect opportunity for landscape professionals to do this kind of work. The problem for local landscape contractors is they are usually smaller than a road contractor outfit, and aren’t used to the agreement to bond.”
GET BONDING IN PLACE
In his experience with rural municipalities, Kelly has found that landscapers in these regions are caught in a difficult situation. Because most of the projects they get are small, the contractors don’t bother to get bonding in place. When the bigger projects do become available, they simply aren’t ready to compete. “It’s a missed opportunity for landscapers in small rural communities. It’s a good business strategy — if you want the work, you have to meet the requirements. You have to be ready,” says Kelly.
Tenders go through a public works process, and typically have a two- to three-week window of opportunity for application. For a landscape firm without bonding in order, the time to secure that agreement can be two weeks or more.
In order to be awarded a tendered con-tract, a contractor must have:
• A performance and labour bond — this ensures the client you will build the project and complete it.
• A material bond — this ensures all the supplies and materials are paid for upfront.
• A liability insurance certificate.
• A workers safety insurance certificate.
LAY THE GROUNDWORK
Kelly recommends that landscape businesses consider bonding as an essential part of laying the groundwork in their business. It is easy to get caught up in the day-to-day operations. When tenders come up for bid, you have to be ready to apply. Otherwise, it becomes a vicious cycle of keeping up, instead of moving forward.
“If you don’t have the bonding, you’ll never be a prime contractor. You’ll always be a sub-contractor,” explains Kelly. “Do not dismiss the size of landscape projects in smaller communities today. I routinely see community projects in the $200,000-plus range, and they are routinely going to roadwork companies.”
GET ORGANIZED
Securing an agreement to bond is not difficult. (See Surety bonds for landscape construction firms in this issue.) The first step is to be organized. Make the time to track your projects. Keep solid records of your work. Document past successes and have client referrals ready. It is in your favour to have a good working relationship with larger contractors who have bonding in place. They can give you a professional reference. Finally, create a good relationship with an assurance company.
Your broker will want to see your documentation and will call your references. Once you’ve established these things, and kept a good track record, your assurance company will be ready with the paperwork for future tender opportunities. Kelly’s advice isn’t restricted to tendered contracts. “I would certainly endorse having full coverage. It’s just good business sense, and good contract procedure,” he says. With a growing market in rural communities, landscape contractors could see a real business payoff by securing an agreement to bond. The initial investment in time and organization can help you secure the winning bid. LT
Kelly Waterhouse is a freelance writer and featured columnist living in Fergus, Ont.