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October 5, 2020

GOVERNMENT SERVICES COMMITTEE

The Committee met at 9 a.m. in the Assembly Chamber.

Pursuant to Standing Order 68, Derek Bennett, MHA for Lewisporte - Twillingate,

substitutes for Pam Parsons, MHA for Harbour Grace - Port de Grave for a portion

of the meeting.

Pursuant to Standing Order 68, Jordan Brown, MHA for Labrador West, substitutes

for Alison Coffin, MHA for St. John's East - Quidi Vidi.

Pursuant to Standing Order 68, Bernard Davis, MHA for Virginia Waters -

Pleasantville, substitutes for Pam Parsons, MHA for Harbour Grace - Port de

Grave for a portion of the meeting.

CHAIR (Haley):

Good morning, everyone. Thank you for joining us for the Estimates of the

Department of Transportation and Infrastructure.

Our first order of business is to identify a Vice-Chair. I think we should call

nominations. Anybody?

Call for nomination of anyone for Vice-Chair. It's normally, typically from

another political party, is that correct?

AN HON. MEMBER:

I nominate Loyola O'Driscoll.

CHAIR:

Any further nominations?

Okay, I will identify the Vice-Chair as Mr. O'Driscoll.

We will move along now with our introductions. Before I do that I just want to

remind all participants to wear masks when moving around the Chamber here today.

As I said, this round of Estimates deals with the Department of Transportation

and Infrastructure.

Now we'll pass it over to the minister for his remarks. You have some 50 minutes

to introduce your team.

MR. BRAGG:

The first thing we'll do is introduce our team. We'll start right to my right.

MS. TIZZARD:

Heather Tizzard, Chief Procurement Officer, Public Procurement Agency.

MR. GRANDY:

Cory Grandy, Deputy Minister of Transportation and Infrastructure.

MR. MORRISSEY:

Patrick Morrissey, Departmental Controller.

MR. DUNFORD:

Joe Dunford, Assistant Deputy Minister of Operations.

MR. BAKER:

John Baker, Assistant Deputy Minister of Air and Marine.

MS. STEELE:

Bonnie Steele, Departmental Controller, PPA.

MR. SCOTT:

Brian Scott, Director of Communications.

MR. BUTLER:

Greg Butler, Budget Manager.

MS. PITCHER:

Margot Pitcher, Executive Assistant to the minister.

MR. BRAGG:

Derrick Bragg, Minister of Transportation and Infrastructure.

Are we going to introduce the other side first?

CHAIR:

Yes, we will in fact.

I'll ask the Opposition and the Committee Members, of course, to introduce

themselves as well.

MR. PARROTT:

Lloyd Parrott, MHA, Terra Nova.

MR. HYNES:

Darrell Hynes, I'm a Researcher for the Opposition Office.

MR. BROWN:

Jordan Brown, MHA for Labrador West.

MR. KENT:

Steven Kent, Researcher for the Third Party.

MR. O'DRISCOLL:

Loyola O'Driscoll, MHA for Ferryland.

MR. MITCHELMORE:

Christopher Mitchelmore, MHA for St. Barbe - L'Anse aux Meadows.

MR. BENNETT:

Derek Bennett, MHA for Lewisporte - Twillingate.

MR. TRIMPER:

Perry Trimper, MHA, Lake Melville.

MS. GAMBIN-WALSH:

Sherry Gambin-Walsh, MHA, Placentia - St. Mary's.

CHAIR:

Okay, Minister, if you could carry on.

CLERK (Hammond):

1.1.01, Public Procurement Agency.

MR. BRAGG:

Thank you all.

Before we get into the Public Procurement Agency, I'd like to have 45 minutes to

55 minutes for opening remarks, please. As the Minister of the Department of

Transportation and Infrastructure and the Public Procurement Agency, I want to

provide a few opening remarks prior to our Estimates today.

On the desk in front of you, you will find a little zip drive. That's the answer

to every question you're about to ask today so I guess we can leave now and go

home. If we could be so lucky.

This year, the ongoing pandemic impacted all sectors of our province. In June of

this year we made changes to the Public

Procurement Regulations to help support the local business community. A

local preference provision was added to the regulations that mandates an

allowance of 10 per cent for local suppliers to a maximum permitted under the

trade agreement.

In addition, procurement thresholds were increased to allow more opportunities

for public bodies to direct businesses to a limited call process. We also

announced the formation of a working group that is tasked with identifying

additional opportunities to improve local preference. We will be consulting with

the business community as part of that process. I look forward to continuing the

work of the Public Procurement Agency as it continues to modernize public

procurement, including a launch of a new eProcurement system later this year in

partnership with the Department of Transportation and Infrastructure.

This budget marks a significant change for the new Department of Transportation

and Infrastructure. With the change in name we also welcome an increased focus

on infrastructure, combining the roads and buildings infrastructure that was in

the former Department of Transportation and Works, with municipal Health

infrastructure to form a new department.

The funding associated with a new mandate is reflected throughout the Estimates.

The budget includes over $519 million in infrastructure funding supporting a

number of projects including: $23 million for upgrades to the existing health

care facilities; $48 million for ongoing construction of new schools in Gander,

Paradise, Bay Roberts and St. Alban's; $5.5 million to advance a new

correctional facility in St. John's and expand the Labrador Correctional

facility in Happy Valley-Goose Bay; $4.1 million is allocated for wharf

infrastructure improvements in Makkovik; $200,000 for a prefeasibility study for

a road to the north, which would potentially link northern communities to the

rest of Labrador; $400,000 to complete an engineering study on the scope and

replacement costs of the wharf in Lewisporte to help inform future

infrastructure investments; and $46.6 million for municipal infrastructure

projects related to water and sewer, roads and paving projects, municipal

facilities, waste management projects and other improvement projects. We have

reached final close on the contract to design, build and maintain a new adult

mental health facility hospital in St. John's.

The Transportation and Infrastructure budget for '20-'21 includes $499 million

operating and grant funding. Our current account infrastructure is $184 million

and our capital account infrastructure is $335 million. We continue to see good

results in our Provincial Roads Plan. The department spent over $155 million on

all road infrastructure in 2019-20 and for '20-'21 the budget is $171.6 million.

We have also been able to leverage federal funding on cost-shared programs for

highway infrastructure throughout the province.

Highway safety is one of the top priorities of our department. We are continuing

to install highway cameras across the province. In '19-'20 we installed cameras

in Badger, Birchy Narrows, Lewisporte, Port au Port and Port Saunders for

approximately $129,800. In early 2019 we began providing a new ferry service

across the Strait of Belle Isle at an annual contracted cost of $11.9 million. A

new ferry service for Northern Labrador began mid-2019 at an annual cost of

$14.6 million.

Working with our partners we implemented a number of changes this season. One of

those changes is the online freight tracking system that allows customers to

track the progress of their orders. Better management of shipments due to new

freight and shed racks in Goose Bay: All freight is now placed in containers at

ports to avoid damage from the weather. A revised weekly

schedule enables more

daytime departures from all ports. I'm pleased to say in 2020 the service did

not have a single weather delay until September.

To the end of August, approximately 5,500 tons of freight have been shipped, an

increase of over 300 tons from the year before. We are very proud of the

improvements we have made in partnership with the ferry operator and the ferry

users to iron out some of the issues that we encountered earlier on.

Our department has also made it a priority to reduce spending on leased space

and unused assets. Since 2016 we have reduced our office space footprint by

168,026 square feet, which is currently saving taxpayers approximately $4.39

million every year. In addition, following a review of our light duty fleet, 112

of our 1,100 vehicles have been removed from the government's fleet since April

1, 2018. This is anticipated to lead to approximately $500,000 in savings

annually through lower maintenance requirements.

Throughout our Estimates we'll refer to two major events that impacted our

department: the January snowstorm, Snowmageddon, and the ongoing public health

crisis, COVID-19. During the last fiscal year we spent $2.6 million for the

January snowstorm event, in which $1.2 million was spent to help the city. Over

the last year, in the current financial year, we have also incurred expenses

relating to COVID-19 of approximately $580,000. This is mostly related to the

purchase of PPE, plexiglass and other supplies.

A little note on our employees. TI has 1,683 employees as of March 31, 2020.

This includes 84 employees on 13-week contracts. Of these employees: 1,520 are

unionized non-management, 163 are management; 1,462 are male, 221 female; 765

are permanent, with 320 seasonal, 582 temporary, 16 contractual; 985 for

Operations Branch; 245 for Air and Marine Services; 314 for our Infrastructure

Branch; 139 for Strategic and Corporate Services; 605 are on the Avalon, 353 in

Eastern, 252 in Central, 398 in Western, 75 in Labrador. Throughout government's

attrition plan the department has an attrition target of $809,000 in 2018-20,

which includes 24 positions. For 2021-2022, the department has an attrition plan

of $678,300 and 26 fewer positions over two years.

Madam Chair, that would be my opening remarks. I look forward to the questions

from the Members opposite.

I guess we're going to start with the Procurement. So if we're ready to go.

Thank you.

CHAIR:

Thank you.

Yes, I'll ask the first responder to bring remarks.

MR. PARROTT:

I'll like to thank the minister for his opening remarks. I assume your zip drive

is a copy of the briefing binder? Is that fair to say?

MR. BRAGG:

That's what's in the zip drive, yeah.

MR. PARROTT:

So you reviewed some of the numbers that we were going to ask. Obviously, I

won't go back through them because we'll be able to get them out of

Hansard . So we'll go right into

1.1.01.

Under Salaries there was a slippage of $228,936, increasing to $2,022,800. Can

you explain that?

MR. BRAGG:

Okay, so last year the bi-weekly payments were 27 rather than 26. So the

increase of $68,800 between the'19-'20 budget and'20-'21 budget reflects the net

funding for the 27th pay period, $74,90; less attrition of $6,110.

MR. PARROTT:

So I assume for payroll it's the 27th pay period for all?

MR. BRAGG:

Twenty-seven pay periods rather than 26.

MR. PARROTT:

Okay, yeah.

Employee Benefits, it shows an unbudgeted expenditure of $3,078.

MR. BRAGG:

The increase of $3,078 actually reflects the registration for two attendees for

the Canadian Public Procurement Council Conference annual CPPC membership fees.

MR. PARROTT:

So the year before there was nothing budgeted and this year there's $800. Can

you explain the requirement for the $800?

MR. BRAGG:

It's a change in the reporting to the Canadian Public Procurement Council

membership fees.

CHAIR:

Excuse me; it's getting difficult to hear here. I ask that you – thank you so

much.

MR. PARROTT:

Under Transportation and Communications, it shows that you spent less than half.

Why is there a request for $48,900 again this year?

MR. BRAGG:

Why is there? Why it's less than half is because of the decrease in travel

plans. Should we revert to normal, we will revert to travelling again.

MR. PARROTT:

We're halfway through the year; you must know where you are with your budget

from that?

MR. BRAGG:

The budget was, I guess, anticipated for March, for the full year.

MR. PARROTT:

Fair.

Under Professional Services, obviously, it wasn't spent last year and it's

requested again. I'm just wondering …

MR. BRAGG:

Pardon me, special services?

MR. PARROTT:

Professional Services, sorry.

MR. BRAGG:

Professional Services, so the $100, is that the question?

MR. PARROTT:

No, it was $23,600 budgeted last year, zero spent, and a request again for

$23,500 this year.

MR. BRAGG:

I guess, due to COVID-19 there were no auctioneering fees. We use an auctioneer

when we dispose of assets and there was none this year so there were no fees.

MR. PARROTT:

I assume the auctions only happen in the spring. Is that a fair statement?

MR. BRAGG:

I would look to Heather.

MS. TIZZARD:

Largely, we have some in the winter as well, but it just so happened that there

weren't any assets to dispose of. We did one auction late last year but due to

COVID it was actually charged in the following year.

MR. PARROTT:

Okay.

Under Purchased Services again, less than half was spent, $24,644, and again

this year the request is for $54,000?

MR. BRAGG:

Budget reflects a reduction in the number of facility rentals required for

training. Again, we budgeted that in anticipation that the year would go back to

normal.

MR. PARROTT:

Under Revenue - Provincial, what is the source amount and why is it only $96,829

collected of the $368,000?

MR. BRAGG:

Heather could you take that one?

MS. TIZZARD:

The source of revenue in our Revenue line are two items that comes from rebates

from using our purchase cards and it also comes from auctions. Of course, as I

said, we didn't have any auctions last year so we didn't see the revenue from

that.

MR. PARROTT:

How many audits were completed in the last year?

MR. BRAGG:

I'd look to Heather for that.

MS. TIZZARD:

We had five audits last year and another six initiated.

MR. PARROTT:

What role, if any, did the agency play in the review, evaluation,

value-for-money function of the new mental health hospital?

MS. TIZZARD:

That was led by the Department of Transportation and Infrastructure.

MR. PARROTT:

Okay.

Does the agency have any statistics on the take-up of the new provision to give

local businesses more access under the 10 per cent mandate for local suppliers?

MS. TIZZARD:

I do have some numbers here.

We had six businesses that benefited, that's just core government, so that's not

counting the health authorities, school board or anything like that. Through

their implementation, there were 21 procurements where we had provincial and out

of province. So that's when it would be applied, of course, because we have a

lot of procurements where it's all in-province businesses. Out of that, there

were six procurements that were awarded after the application of provincial

preference that wouldn't have been awarded to the local business otherwise.

MR. PARROTT:

Okay.

Given the recent media stories involving Shannahan's Security and United Sail

Works, both losing contracts to outside companies, how successful do you believe

this policy has been?

MS. TIZZARD:

The security that you mentioned, too, would have been far over threshold, so we

can only apply these preferences to under trade agreement thresholds. The value

of a security contract would have been far above those thresholds.

MR. PARROTT:

I guess I'll ask the same question to the minister in a different way.

Obviously, with regard to these contracts, and if it exceeds the threshold, is

there anything in place to ensure instances like this doesn't happen going

forward?

MR. BRAGG:

I guess we're here to talk about the line by line, if you want to leave that

question for Question Period, I'll welcome it.

MR. PARROTT:

Okay.

No further questions.

CHAIR:

Mr. Brown.

MR. BROWN:

With the Procurement Agency, I noticed that you're transitioning to a more

online basis, how's that going?

MR. BRAGG:

Pardon me?

MR. BROWN:

You're moving to a more online-based procurement system.

MS. TIZZARD:

Yes, we're implementing a new procurement system. Actually, it was supposed to

go live in March, but of course with COVID it was delayed. So we anticipate it

will be implemented very shortly.

MR. BROWN:

What is the expectation of savings for going on the online system?

MS. TIZZARD:

More so efficiencies, but also hoping to see some savings, obviously, with just

any sort of error with respect to vendors inputting information and that sort of

thing. The system will prevent a lot of those things from happening, from a

vendor putting in a wrong number or forgetting to sign a document. It will lead

to a more competitive process, which would, hopefully, lead to better value.

MR. BROWN:

Okay.

Right now, have you piloted a project with any of your local vendors?

MS. TIZZARD:

Not yet. We're supposed to be implementing training soon and then it will go

live after that.

MR. BROWN:

Are you planning on doing feedback? Will you provide feedback to the House after

this is all completed to see if it actually is a viable system?

MS. TIZZARD:

We don't have a formal process in place for that yet. As we're going on

implementing the system, we anticipate any questions that suppliers have.

There'll be a line and a person on hand that can answer all those questions. I

anticipate more of a live feedback sort of process to help them through it.

We also intend to keep our old process in place for a period of time, too, just

to help people through this hurdle.

MR. BROWN:

Was the system built by a local company or in-house or outside of that company?

MR. BRAGG:

Excuse me, can I cut in?

If we're going to stick to the line by line, that's questions definitely for

Question Period. I don't know if someone can give me some guidance here.

Shouldn't we stick to the questions of line by line?

CHAIR:

I'm told that it can be …

MR. BRAGG:

Oh, can it?

CHAIR:

Yeah.

MR. BRAGG:

Okay.

I guess we only have three hours, so let her go.

MR. BROWN:

Was it built in-house or was it built by an outside company?

MS. TIZZARD:

We issued an RFP and there is an outside company that won that contract.

MR. BROWN:

Perfect, thank you so much.

I'm good.

CHAIR:

Before we move on, I'd ask that you identify yourself before speaking so that

the folks down at the media centre can see where you're sitting and make sure

that your microphone is turned on.

MR. LANE:

Madam Chair.

CHAIR:

Yes.

MR. LANE:

Waiting for my light to come on.

CHAIR:

Mr. Lane is actually sitting in Mr. Brazil's seat.

MR. LANE:

Thank you.

First of all, Madam Chair, with leave, I'm not a Member of the Committee but as

per past practice for the last five years, I generally can ask a few questions

with leave of my colleagues.

CHAIR:

Okay.

MR. LANE:

Thank you.

Minister, as per my normal practice, I'm going to leave the line by lines to my

colleagues. I just have a few general questions, I guess.

The first one relates to COVID-19. I've asked this at all the Estimates so far,

and I'm going to continue doing that, I guess. Just wondering the experience in

your department as it relates to COVID-19 and efficiencies that have been found.

One of the things that COVID-19 has brought – it's brought a lot of trouble, of

course, but I think it has also identified opportunities within government to do

things differently and be more efficient in terms of online services, in terms

of reduction in travel cost, because we can use Zoom instead of having people

criss-crossing the province. Also opportunities, perhaps, of employees working

from home. It works in some cases, not in all.

I'm just wondering what type of efficiencies have been realized through COVID-19

in that regard and opportunities to make that a permanent thing. I did hear you

mention about travel and saying, well, we budgeted because once COVID is over

we're back to normal. Well, if we don't need to travel and we can save

taxpayers' money by using Zoom, then I would think that we should be doing that

on a permanent basis. Certainly, the Minister of Finance certainly concurred in

her Estimates. So I'm just wondering your thoughts on that.

MR. BRAGG:

You referenced Zoom, so Zoom has certainly helped us get through this, as has

Skype and any other means; FaceTime for families, you name it. I think everybody

would agree, when the day comes and we get back to normal, there's nothing beats

a face-to-face meeting as opposed to a video call. Video is taking the place

right now.

Certainly, I don't personally feel we're getting the full value out of a Zoom

call as what we do with a face-to-face call. You don't get the same type of

debate or conversation. So I guess that's my personal feeling. As a department,

overall, we probably haven't done a full evaluation of it yet. There are

probably still people working from home in many government offices. So when we

get a chance to sit back and review this and policies of government from working

from home or not going to meetings.

I really don't know how you would do an FPT, to be honest, Paul. How we do an

FPT when you're up in Ottawa or some other part of Canada and you get a chance

to have the interaction even after the Zoom meeting to get to have the after

calls.

You and I have both been at MNL. MNL is going to do a Zoom meeting this year. I

don't think you can get the feeling out of that as you would if you were

actually at the convention centre. So we need social interaction. I don't think

we can really live on a video screen. We're doing it now because we have to do

it now. Maybe you feel different, but that's just my thought of it.

So as time goes on, no doubt this changes it all, there's no doubt about that.

MR. LANE:

Thank you, Minister.

Yeah, I certainly wouldn't necessarily be of the mindset that we do everything

from a video screen, but I also believe that, again, there are efficiencies to

be found. We're up to our neck in debt, beyond that, as a province and taxpayers

are looking for us to start finding ways to save money. I guess, hopefully,

there are ways we can do that. I think that this is an opportunity to save some

money.

Madam Chair, I apologize because I was a little bit late arriving, so I'm not

sure what

section we're on, what was called.

CHAIR:

Public Procurement.

MR. LANE:

Oh, we're into Public Procurement. Oh, my goodness. Okay, all right.

Well, on the Public Procurement piece, Minister, I'm wondering about – and it

kind of ties into some of the questions, I think, my colleague was getting at,

I'm wondering what opportunities we have here to ensure that more local

companies have an advantage to get a lot of the work that's procured by

government.

Certainly, one of the shortfalls and the concerns that I had and other

colleagues had in the House at the time that we brought in the new Procurement

Act was that everything was left to the regulations. That was a major downfall

as far as I was concerned. It was very, very basic and everything – of course,

the regulations are made by the minister and therefore Members of the House have

no idea what's going to be in the regulations and how the act is going to work.

One of the things, though, that the minister of the day said was that we're

going to try to promote local and support local businesses, but again there was

no meat on the bone for us to actually debate to see if that would happen. We

are hearing from companies that are saying that they're losing out on work and

so on. I understand that part of that is capacity. As an example, of course, if

you ask a company to do the drywall – I think we talked about that – on the new

hospital, we're saying there's no company in Newfoundland that can do it all

because the job it too big.

Why can we not be looking at things and breaking it down into component parts,

and so on, so that local companies can do, at least, part of it? I understand

the cost. They will say it's cheaper to put it all together, to bundle it all

together and get one company to do it all. You may be saving some money on this

hand because the actual cost to the project may be a bit lower, but if all the

profits and all the jobs and everything else are going outside the province, did

you really save anything? I would argue that we probably lost money because none

of the money is staying in Newfoundland. It's all going to Quebec or Ontario or

Nova Scotia, or wherever it's going to.

I'm wondering, is there anything being discussed or done within the department

or considered to look at ways of, as I say, unbundled projects, break projects

down into smaller component parts? Or even be proactive and go to the local

companies and say, listen guys, you can work together and put in a joint bid on

some stuff to try to ensure that Newfoundlanders and Labradorians get the work.

Given the fact, again, where we are, the mess we're in, the unemployment rate

and skilled tradespersons sitting home while there are people from Quebec and

everything coming here into the province and taking jobs that we cannot give up,

I'm just wondering what your thoughts are on that? That was a mouthful I know.

MR. BRAGG:

You seem to be referencing the hospital in Corner Brook for both of these?

MR. LANE:

I just used that as an example, Minister. It could be anywhere.

MR. BRAGG:

Okay.

Heather, you have the most knowledge on this. As you guys know, this is newly in

our department. My understanding is that was a big overall project. Procurement

would be the smaller projects outside of that which government would be

interested in bidding.

If you want to explain it more to (inaudible) please.

MS. TIZZARD:

There may be some opportunities to have companies combined. We can't split apart

every part of a large project either, because that's really contrary to trade

agreements, to start splitting stuff apart just so you can keep it in-house.

There may be some opportunities depending on how – generally, a large project is

sourced to a large contractor that then subcontracts out, but we can't split all

components up because that would be contrary to trade agreements. I'm not sure

if that's answering your question.

MR. LANE:

It is to a degree. That's kind of what I'm wondering, if there are ways to

sometimes split projects up somewhat. I understand if you have one facility it

might be difficult to chop it all up, but maybe if it was multiple facilities,

instead of combining it all into one big project and let some Mainland company

come take it all, at least if there are opportunities to be able to legitimize

what you've done so that local companies can have an opportunity to bid, I guess

that's where I would be coming from on it.

I do thank you for that answer. I really would like to see more done in that

regard, if it was possible. It's hard to take. It really is hard to take, to see

our own people home on unemployment when you're watching them come in from other

provinces.

Let me ask this: Is it possible – I guess anything is possible. Has there been

any thought to ensuring local benefits agreements, so that if a company bids,

for example, from outside, then they have to hire Newfoundland workers? You

never hear of any Newfoundlanders going to work in Quebec. I use that as an

example because I'm told that Quebec is Quebecers only. I could be wrong but

that's what I keep hearing, that primarily Newfoundland companies will never get

a job up in Quebec.

They seem to have it both ways. I'm wondering why they can have that

protectionist philosophy and be allowed to do it, but we can't?

MR. BRAGG:

I'll take this one.

In reference to what you said earlier about the numbers of people, I'm thinking

the larger facilities – and probably one of the biggest ones that we have on the

go now would be the hospital in Corner Brook. That's – is it $600 million?

OFFICIAL:

Around $500 million.

MR. BRAGG:

Around $500 million for that one.

In Corner Brook I'm told there's 92 per cent. I was actually in Corner Brook

last week and they told me wherever they can source Newfoundland companies –

Johnson was there. I know because I saw it on their truck and several other

small Newfoundland companies that were on site. Although the main contractor was

Marco, there are lots of subcontractors and they availed of what they could, but

outside of that – because that is the biggest one.

The most recent one would have been – Moss would have been the lucky bidder for

building the wing on the hospital down in Goose Bay. That's about a $7-million

contract. Moss has told us if at all possible they would have 100 per cent

Newfoundlanders and Labradorians employed on that project.

You referenced earlier why Newfoundlanders don't go to Quebec. I'm thinking the

main reason Newfoundlanders and Labradorians don't go to Quebec is the language

barrier. We have no shortage of Newfoundlanders and Labradorians that go all

throughout this world and, certainly, across Canada. We have so many people that

work in the oil industry in Alberta.

From my young age – and I know the community near me – everybody went to

Toronto. For years and years everybody went to Toronto; it was a mass exodus in

the spring. People would go up to Toronto and come back in the fall. People are

going to BC. A lot of my friends now are in the northern part of Canada. We have

no shortage of people, so to just pinpoint and say they don't go to Quebec, I

don't know who goes to Quebec to go to work and who doesn't go to Quebec to go

to work.

I do know we have a lot of people that fly out. That's why we have rotational

workers in this province that go throughout Canada for work. I don't think

anybody here can refute that because most of us have friends in the last few

years who are working in the construction trades. When I was in Corner Brook I

sat and talked to a steelworker there and I said: Where are you learning your

trade? He said: All across Canada.

It's not every day there's steel being rigged anywhere in this province so,

obviously, for that person to have employment – and they lived on the West Coast

out around Stephenville, the Port au Port area. There have been a lot of people

– none of us here can say I don't know anyone who's worked outside the province,

because most of us know multiple people who worked outside the province.

MR. LANE:

Thank you, Minister. I appreciate the answer.

I just say that I understand that. I know a lot of people who are rotational

workers as well and up in Alberta, Northern Manitoba and all those areas, but I

think that maybe the difference is that there are lots of jobs up there and they

actually need people to go there.

We don't need anybody to come here, as a general rule, to do the work. There

might be some specialities but we don't need anybody do come and do drywall work

or anything else in Newfoundland when we have our own drywall workers. Maybe if

they're up north somewhere they need people, they don't have enough local people

to do it, or want to do it or are willing to do it, so then they are hiring from

outside.

CHAIR:

Mr. Lane, your time has expired.

MR. LANE:

Anyway, thank you.

CHAIR:

We'll go now to –

MR. BRAGG:

Could I respond to that though?

CHAIR:

Go ahead, yes.

MR. BRAGG:

Because there's another little piece of – I don't know what time I've got.

In Corner Brook last week they were looking for sheet metal workers. Most people

don't know any sheet metal workers, let's be fair. They had three applicants

come in for sheet metal workers. They wanted multiple ones. There's sheet metal

going to be over there big enough to drive a car through. Actually, in their

words you can drive a tank through it. If you're talking about are the workers

here? There were no sheet metal workers, only three that came forward and they

put the call out right across the province.

It's easy for us to say that there are lots of people. Maybe there are lots of

people and maybe the right people haven't come forward at the right time. I have

no idea. I'm not in their HR. I don't do their hiring. Unlike you, I don't like

the thought that my friends, my neighbours have to go to all parts of Canada for

work when there's potential work in the province, but the on-site people and the

people I talk to – again, I just spoke to a steelworker and he said all the

steelworkers are from Grand Falls to Port aux Basques.

That was the catchment area, so I'm not sure people from the Avalon would be

enticed to go to Corner Brook or Corner Brook to come to the Avalon. I don't

know because I don't know what people are wiling to work for. We don't know

everybody's individual preference when it comes to a job.

Yeah, I feel what you're saying, the thought that we're building a $500-million

facility and we have to hire outside people, sure, but if that's what it needs

to build that facility that's badly needed for the West Coast of this province,

I guess that's one of the pills we have to swallow to get the building finished.

CHAIR:

Thank you.

We'll now move along to Mr. Parrott.

MR. PARROTT:

Just one quick point, one quick question.

To the minister's point earlier, the idea of a community benefits program isn't

so people go and build buildings or work in oil fields or any of that kind of

stuff. That's what you see out West in BC and Alberta. The idea of a community

benefits program is so that Newfoundlanders are employed in anything that the

government has their fingers on. What I mean by that is if we give a company a

tax break, if we're an owner of the infrastructure or if we're an investor

through a 3P or likewise.

Community benefits programs are in place and you will not see anybody from a

different province working in Quebec on any piece of Quebec infrastructure owned

by the provincial government. It doesn't happen. It simply doesn't happen. It

doesn't happen in Alberta. The workers that leave Newfoundland go to Alberta to

work in oilfields, where, I might add, the provincial government isn't always

involved in. Unlike us, where we have equity stakes in our oil. That is why when

facilities are built here they're done under special site agreements, as in Bull

Arm and Argentia, and that's why Newfoundlanders have first priority.

I, unlike you, believe that it should be 100 per cent, not 92. There are lots of

sheet metal workers in Newfoundland. The companies that are in Corner Brook are

avoiding the unionized workers, and I get that, too. So I'm not going to get

into that. I think that we all understand the nuances involved with that, but

there are plenty of sheet metal workers in Newfoundland. All you have to do is

look to the living quarters that was built in Bull Arm and in Marystown; it was

all sheet metal workers that did the bulk of that work, from the construction

standpoint, all Newfoundlanders. So we'll leave it at that.

The one thing I would like to go back to is the question that the Member for

Labrador West identified with regards to public procurement going live online.

What sticks out to me is there was an indication that this was scheduled to

happen in March. The reality is that the world didn't stop until the middle of

March. So I would assume that if we were ready to go live in March, then we

ought to be very close to being able to go live now and we should be able to get

a date as to when that would happen.

MS. TIZZARD:

We don't have an exact date yet. We still have to

schedule some training.

MR. PARROTT:

So like months away or weeks or …?

MS. TIZZARD:

I don't think it's months. Probably closer to weeks.

MR. PARROTT:

Okay, thank you.

No more questions.

CHAIR:

Mr. Brown?

MR. BROWN:

I'm good, thank you.

CHAIR:

Thank you.

CLERK:

1.1.01.

CHAIR:

Shall 1.1.01 to 1.2. –

CLERK:

No, just 1.1.01.

CHAIR:

Okay, sorry.

CLERK:

That's all there is for PPA.

CHAIR:

Okay.

CLERK:

1.1.01.

CHAIR:

Shall 1.1.01 carry?

SOME HON. MEMBERS:

Aye.

CHAIR:

All those against, 'nay.'

Carried.

On motion, subhead 1.1.01 carried.

CLERK:

The total.

CHAIR:

Shall the total pass?

All those in favour, 'aye.'

SOME HON. MEMBERS:

Aye.

Carried.

On motion, Public Procurement Agency, total heads, carried.

CHAIR:

Shall I report the Estimates of PPA carried?

All those in favour, 'aye.'

SOME HON. MEMBERS:

Aye.

CHAIR:

All those against, 'nay.'

Carried.

On motion, Estimates of the Public Procurement Agency carried without amendment.

CHAIR:

We'll now move along to Transportation and Infrastructure.

CLERK:

1.1.01 to 1.2.06 inclusive.

CHAIR:

Shall 1.1.01 to 1.2.06 inclusive carry?

Mr. Parrott.

MR. PARROTT:

I'd like to know, first off, how many vacancies are in the department right now?

MR. BRAGG:

In the department, I can give you the heavy equipment technician vacancies. In

the Avalon, there are five: three in the White Hills, one in Foxtrap, one in

Whitbourne. In Eastern, there are no vacancies. In Central, there are four:

three in Grand Falls-Windsor, one in Pool's Cove. In Western, there are 16 in

total: seven in Deer Lake, one in Plum Point, two in Rocky Harbour, one in

Roddickton, one in Sop's Arm, one in Stephenville, one in Tompkins and two in

Wild Cove. There are 25 vacancies across the province for 2020. In 2018, there

were 17 vacancies.

I throw this out at you: If you know any heavy equipment technicians looking for

work, please ask them to apply to the department because we're looking for them.

We'll need them for the upcoming season, so sooner rather than later.

MR. PARROTT:

Have there been any positions eliminated within the department in the last 12

months?

MR. BRAGG:

In my opening remarks I talked about attrition.

MR. PARROTT:

I just assumed that to be through the whole department when you said that, so

including Procurement. That's why I'm asking specific for here.

OFFICIAL:

What was your question again?

MR. PARROTT:

Elimination of positions just specifically the Transportation and Infrastructure

department

MR. BRAGG:

Cory can take that question.

MR. GRANDY:

The number that the minister had in his opening remarks was specific to

Transportation and Infrastructure.

MR. PARROTT:

Thank you.

For your vacancies, obviously, other than asking us if we know anyone, is there

a plan? Does the department have a strategy on this? Because it's an issue,

right? I know I've dealt with departments and I dealt with the ADM several times

and, at the end of the day, it's a widely known issue and, obviously, it creates

greater issues going forward.

MR. BRAGG:

I guess it's on our website, it's actively there and you will see open until

filled. Some of these positions will be open until filled. Again, many of us, as

MHAs, we reach all throughout this province, so we should be able to drawdown

from the people that we know in our area and reach out and ask people to get

their application in.

MR. PARROTT:

How many new hires did we have in 2019-20?

MR. BRAGG:

Joe.

MR. DUNFORD:

I don't have our turnover rate at the moment on our vacancies.

With respect to your question about a plan, we've seen we do have some

vacancies, obviously, in our HETs. One of the things that we have been doing is

looking for apprentices, apprentice mechanics. We have a very good relationship

with the Office to Advance Women Apprentices and we've been utilizing that to

fill some our – to get some of our apprentice positions filled as well, which

will help our mechanics.

MR. PARROTT:

That's a good point, so I'll bring a point associated with apprentices,

obviously, outside of your department. But the belief that that strategy will

work is a little flawed right now based on the fact that none of the schools are

offering any apprenticeship incentives or block training for anybody based on

COVID since last March, nothing scheduled for this upcoming year and a major

backlog for next year based on that. Obviously, you need a different approach.

MR. DUNFORD:

We still have apprentices that have come to us looking for work. We haven't seen

a lull there at all at this point. Whether that comes – there's a lag to that,

that's possible. At the moment, we are seeing apprentices approach us looking

for work and so we are able to recruit some.

MR. PARROTT:

Okay.

I'll just go through some lines and I may have some different questions as we go

through, but I'll start with 1.1.01.

Why the projected increase of $14,700 under Salaries? Again, is that the 27 week

MR. BRAGG:

That 1.1.01 is a salary increase due to a step increase for '20-'21, as well as

an additional pay period '20-'21; remember the 27 as opposed to 26?

MR. PARROTT:

Thank you.

1.2.01, Executive Support, Transportation and Communications: Why the unbudgeted

jump of $9,080 from $39,000 to $48,080?

MR. BRAGG:

Higher than anticipated travel for the executive, including meetings in Labrador

for marine service issues, Corner Brook acute care project, hospital meetings,

FPT transportation, highway safety meetings, P3 conferences and infrastructure

meetings in Quebec.

MR. PARROTT:

We're going to travel to Quebec this year?

MR. BRAGG:

We were there.

MR. PARROTT:

You were there. I hope you quarantined.

MR. BRAGG:

Before.

MR. PARROTT:

Gotcha.

MR. BRAGG:

Some people went to Florida just before, remember?

MR. PARROTT:

Yeah.

1.2.02, Employee Benefits: A revised expenditure of $2,259,311. Can the minister

explain the extra $264,511?

MR. BRAGG:

The variance relates to workers' compensation payments. This demand is driven

and can vary based on the number of claims submitted. It's my understanding we

pay our own workers' comp.

MR. PARROTT:

Obviously, that's significant. Is that an increase in the premium or an increase

in incidents in the workplace?

MR. GRANDY:

That's claim payouts; it's not just the premiums. Some of those claims could go

back decades. In recent years, it's not necessarily an increase in incidents but

increasing costs over time, given the age of some of those claims.

MR. PARROTT:

Okay, thank you.

Same section, 1.2.02, Transportation and Communications: Why were the revised

expenditures in Transportation and Communications $136,492 less than budgeted?

MR. BRAGG:

Reduction in travel for financial operations, Corporate Safety Division, savings

on new mobility contracts and reduced postage costs.

MR. PARROTT:

Okay.

Under Supplies you spent $64,931 less than the budget, but you increased your

budget in '20-'21 to $107,300. Can you explain why?

MR. BRAGG:

The savings were due to the reduction in PPE equipment for OHS employees,

headquarter supplies requirements and some interdepartmental JVs for recovery of

envelope purchases.

MR. PARROTT:

During your opening remarks you indicated that you had an additional $518,000 in

COVID spending. Can you indicate if there's been any savings due to COVID and

people not working, fuel, travel?

MR. BRAGG:

Yes, you'll see savings throughout. Though in some places you'll see savings and

some places you'll see over –

MR. PARROTT:

You don't have a bulk number as you did for spending?

MR. BRAGG:

As we go forward through each

section we'll highlight that for you.

MR. PARROTT:

Okay.

Did the department receive any funds specifically from COVID? What were they

used for?

MR. BRAGG:

COVID from the feds you mean?

MR. PARROTT:

Well, the money that came into the province, yeah, the $437 million.

MR. GRANDY:

I think you're thinking about some more of the operational things but under the

ICIP agreement, infrastructure funding with the federal government, they have

modified the ICIP agreement to allow provinces to spend up to 10 per cent of

their allocation for projects with greater flexibility.

The province is taking advantage of that. We can get into that in one of the

later sections but …

MR. PARROTT:

1.2.02, Professional Services: Can you explain why you spent an additional

$118,922 last year?

MR. BRAGG:

That was an overrun due to mobility procurement advisory services, as well as a

consultant cost for a rebuild of the department's TRIM system. Savings were

identified in other areas of the department to offset these costs.

MR. PARROTT:

Okay.

Under Purchased Services, can you explain the nature of the $59,658 dropped

balance last year?

MR. BRAGG:

A reduction in anticipated shredding, printing and document storage costs. The

department rightsized this budget during the 2020 process.

MR. PARROTT:

Property, Furnishings and Equipment: Can you explain why you only spent $8,465

of the $24,200 budgeted?

MR. BRAGG:

Savings due to the lower than anticipated ergonomic assessments during the year.

MR. PARROTT:

1.2.03 Strategic and Support Services: Under Supplies, a drop in balance again

of $12,844. Can the minister provide an explanation?

MR. BRAGG:

$12,844?

MR. PARROTT:

Yes.

MR. BRAGG:

Okay.

A reduction in information management equipment, printing service and uniforms.

MR. PARROTT:

Okay.

Purchased Services: The actual number shows a drop in balance of $57,996, but

goes back up to $147,600 this year. Can you explain why?

MR. BRAGG:

In 2018-19, the Department of Transportation and Infrastructure entered into

lease arrangements for mill machines in the region. As these machines are newer,

they do not require the same level of maintenance.

MR. PARROTT:

Okay.

Again, under the same heading: Can the minister clarify the unbudgeted

expenditure of $13,072?

CHAIR:

The Member's time has expired.

You can go ahead, Minister.

MR. BRAGG:

Okay, I'll give you an answer on that one.

An increase due to incurred charges, but it relates to the annual lease payments

for mill machines and belongings under Purchased Services.

CHAIR:

Mr. Brown.

MR. BROWN:

Thank you.

Just a minute ago you said the rebuild of the TRIM system. Can you explain that?

CHAIR:

Mr. Brown, is your light on?

MR. BROWN:

Yeah, my light is on.

CHAIR:

Okay, sorry. It's not there.

MR. BROWN:

My light is over here.

CHAIR:

Okay.

MR. BROWN:

You said you had to rebuild a system. Can you explain that?

MR. BRAGG:

Can you give me the

section number?

MR. BROWN:

Oh, sorry.

Section 1.2.02.

MR. BRAGG:

1.2.02, Professional Services.

1.2.02: Costs associated with executives attending meetings outside of agencies

and regional staff. Does that make sense to you?

MR. BROWN:

No because you said earlier under one

section there, it was an additional cost

to rebuild the TRIM system.

MR. BRAGG:

Do you want to take this because you can find …

Our TRIM system was built about a decade ago. Of course, the department has

grown exponentially since that time; we've added new people, we added new line

items. What we found was it wasn't a very efficient system anymore. OCIO doesn't

provide a rebuild service, so we had to contract an outside company to help us

with that.

MR. BROWN:

Okay, perfect. Thank you.

In 1.2.03, right here the budget is there for Salaries. Can you explain the cost

of increase in Salaries there by $2 million?

MR. BRAGG:

For Salaries it's the 27 pay periods.

MR. BROWN:

Okay, so it's just the …?

MR. BRAGG:

Yeah.

MR. BROWN:

Okay.

MR. BRAGG:

Instead of 26.

MR. BROWN:

Under the

section there for Revenue from the province, you budgeted last year to

receive $1,600; you never received anything and only budgeted for $500 this

year. Why was there no revenue – it was budgeted for revenue but we never made

any?

MR. BRAGG:

There was no sale of paper documents, paper tenders.

MR. BROWN:

Okay.

MR. BRAGG:

The department rightsized the budget.

MR. BROWN:

You're expecting about $500 this year, is it?

MR. BRAGG:

Yeah, we just rightsized the budget.

MR. BROWN:

Okay.

Under 1.2.04 for Air Subsidies, why do we get $80 from the federal government?

MR. BRAGG:

$80?

MR. BROWN:

Well, not $80, but 80 from the federal government. We received 80 but was not

budgeted.

MR. BRAGG:

There's revenue associated with air services in emergency situations, $80.

MR. BROWN:

They just gave us –

MR. BRAGG:

It had to be a quick pickup for 80 bucks. Cheaper than a taxi.

CHAIR:

Cory Grandy.

MR. GRANDY:

Thank you.

Yeah, I think you said it; it's not necessarily revenue from the federal

government. I think this would've been revenue received from fees for that air

travel.

MR. BROWN:

Yeah, (inaudible), just one particular case where they had to pay us, I guess.

MR. GRANDY:

Yeah, it would've been literally dollars, yeah.

MR. BROWN:

So yeah (inaudible).

1.2.05, is this a new account or just a placeholder account? Just a placeholder

account, is it?

MR. BRAGG:

Yes.

MR. BROWN:

Okay.

1.2.06, Land Acquisition, under Operating Accounts there, it was a line item

that wasn't budgeted, but there was $4,138. What was that for?

MR. BRAGG:

One-time appraisals for land evaluations.

MR. BROWN:

This is a one-time appraisal fee. Okay.

I noticed that we had quite a bit of money budgeted last year but we didn't

spend close to it for a lot of these items. Can you explain that?

MR. BRAGG:

Lower than anticipated land expropriations.

MR. BROWN:

Okay, so there were just less projects where we were required to purchase land?

MR. BRAGG:

No new acquisitions were required this year. The number of settlements was

lower.

MR. BROWN:

Okay. In the coming year, are we expecting any large purchases of land?

MR. BRAGG:

I'll turn that over to Tracy.

There's nothing expected, but, of course, that will depend on whether or not

something requires – for a trunk road or something else, and then money's

available for that.

It's also used to pay prior-year settlements. So, of course, we have settlements

that can date back a number of years and they would come out of this account.

MR. BROWN:

Okay, so you just have to make sure there's enough in there for a potential

settlement.

Yeah, but in the future any capital projects that require a large scale of

appropriation, because of course the amount is a lot lower, will go through the

capital infrastructure account.

MR. BROWN:

Okay, so this is for a different purpose, okay.

Right.

MR. BROWN:

All right, I'm good there.

Thank you.

CHAIR:

Thank you.

Mr. Parrott.

MR. PARROTT:

I go back to 1.2.02. Under Revenue - Provincial, it was projected revenue of

$600,000 and actual was $1,056,736. Can the minister explain where the

additional funds came from?

MR. BRAGG:

So the increase in revenue was due to the higher than anticipated insurance

claims. There was also a lease revenue incorrectly recorded here. It should've

been recorded under leased accommodations.

MR. PARROTT:

Okay, thank you.

Just a quick question on 12. –

MR. BRAGG:

12?

MR. PARROTT:

1.2.04, sorry, do we pay any fees to – I know 103 Search and Rescue does some

different responses for us outside of the norm, outside of their own mandate.

Does the government pay fees to them for transfer or bariatric patients or any

of the other things that they may do on land?

MR. BRAGG:

John Baker has that question.

MR. BAKER:

You're talking about if we have to get search and rescue involved. No, we don't

pay them anything.

MR. PARROTT:

I guess, my question is specific. I know 103 does some transfers of hospital

patients actually, not for marine or an actual search. They just fill in for an

air ambulance based on the fact that the ambulances just don't work sometimes. I

know this because that's where I came from. I'm just wondering is there a fee

involved from the provincial government when we ask them to do that type of work

for us?

MR. BAKER:

As a matter of fact, all of our helicopters are VFR and in a time when we need

anything outside of that, yes, they come to our aid whether it be in Gander or

Goose Bay.

MR. PARROTT:

And no fee?

MR. BAKER:

No fee.

MR. PARROTT:

Okay.

1.2.06, Land Acquisition, Purchased Services what was the nature of the

unbudgeted expenditure of $4,138?

MR. BRAGG:

A one-time appraisal, land evaluations.

MR. PARROTT:

Property, Furnishings and Equipment only spent $137,363 of the $2 million that

was budgeted. I guess, two questions: Why? I'm not saying that's a bad thing,

but why and what's the plan?

MR. BRAGG:

That was under Property, Furnishings and Equipment?

MR. PARROTT:

Yes.

MR. BRAGG:

Lower than anticipated land appropriations that one was. These funds are used to

acquire new land or pay supplements from previous years.

MR. PARROTT:

Okay.

That's the end of this section. Am I correct in saying that?

CHAIR:

Yes.

MR. PARROTT:

No more questions.

CHAIR:

Mr. Brown, are you finished?

MR. BROWN:

Yes.

CHAIR:

Mr. Lane?

MR. LANE:

No.

CLERK:

1.1.01 to 1.2.06 inclusive.

CHAIR:

Shall 1.1.01 to 1.2.06 inclusive carry?

All those in favour, 'aye.'

SOME HON. MEMBERS:

Aye.

CHAIR:

All those against, 'nay.'

The motion has been carried.

Om motion, subheads 1.1.01 to 1.2.06 carried.

CLERK:

2.1.01 to 2.4.03.

CHAIR:

Shall 2.1.01 to 2.4.03 inclusive carry?

Mr. Brown.

MR. BROWN:

We're on the next

section now?

MR. BRAGG:

2.1.01.

MR. BROWN:

Okay, just making sure I was on the right section.

Like I said, I noticed a decrease in Salaries under 2.1.02, what's the reason

for that? There's was an increase in the actuals but there was a decrease in the

following year.

MR. BRAGG:

2.1.02, right?

MR. BROWN:

Yeah, 2.1.01.

There's an increase in actuals but there was a decrease expected for this year

that's not carrying on.

MR. BRAGG:

You're in 01 and not 02, right? 2.1.01?

MR. BROWN:

Yeah.

MR. BRAGG:

Okay, perfect. I didn't want to give you the …

Funding provided for the salary costs associated with the management and

administrative costs of the road maintenance systems of the department: director

of roads and operations, superintendents to operations, maintenance and

engineering project supervisor, et cetera, and includes overtime and other

earnings required.

MR. BROWN:

Okay.

MR. BRAGG:

So this is on the management side.

MR. BROWN:

Yeah.

Under Transportation and Communications, there was an increase in the actuals

last year and then there's lower expected budgeted for this coming year, what's

the reason for that?

MR. BRAGG:

Anticipated savings due to revised mobility contract.

MR. BROWN:

Okay.

Under Professional Services, I noticed there was an expenditure that wasn't

budgeted for.

MR. BRAGG:

That's a minor variance incorrect charge. This is the new Highway Bridge Design

Code from the Canadian Standards Association for the Highway Design and

Construction Division, which should have been incurred under 3.1.01 under

Administrative Support.

MR. BROWN:

Okay, all right.

Under Purchased Services, there was quite an increase in expenditures under the

actuals there and then we're budgeting less than what we budgeted the previous

year, what's the reason for that?

MR. BRAGG:

Okay, we got good news on this one.

Overrun can be primarily attributed to the one-time implementation cost of the

511 program. Savings were identified elsewhere in the department to offset these

costs. 511 is one of the most widely used apps in the province.

MR. BROWN:

Okay, so this was for the 511 app?

MR. BRAGG:

You got it.

MR. BROWN:

Okay, perfect.

Under the Property, Furnishings and Equipment, the one-time purchase there.

MR. BRAGG:

So funding required for office equipment. There are some incorrect charges there

that should have been incurred under Supplies.

MR. BROWN:

Okay.

Under 2.1.02, I noticed under Supplies there was quite a bit incurred last year

in the actuals, but we are budgeting less than we budgeted last year.

MR. BRAGG:

Reduction in budget construction materials to rightsize the budget and reprofile

to winter maintenance as required.

MR. BROWN:

Okay, so you're taking stuff that was supposed to be done in winter maintenance

out of summer maintenance and moving it over.

MR. BRAGG:

There you go.

MR. BROWN:

And that's the same with Purchased Services here, I noticed we're budgeting less

even though we used actually more last year.

MR. BRAGG:

The variance attributed to the summer maintenance cost on the new Trans-Labrador

maintenance contract.

MR. BROWN:

Okay, so that was for the contracted-out service. There are some savings in this

year's coming up contracted service from up in Labrador?

MR. BRAGG:

I have: An overrun primarily due to increased requirements for machinery rentals

as required to supplement TI's own equipment, as well as the washouts that

occurred during the summer 2019 on the Trans-Labrador Highway included $300,000

in anticipated costs.

MR. BROWN:

That was for that big washout there. Okay, I understand.

I notice there under provincial revenue we budgeted – received quite a bit more

than we actually received. What was the reason for that?

MR. BRAGG:

Revenue received from municipalities for roads maintenance work completed on

behalf of the department. Reimbursement of recoverable costs to replace damaged

guardrails that have occurred as a result of automobile accidents and highway

access fees. So if someone smashed down a guardrail, insurance pays us to put it

back.

MR. BROWN:

Okay.

We didn't recover a lot this year, did we?

MR. BRAGG:

I like to say due to COVID-19 we didn't move a lot this year.

MR. BROWN:

Yeah, you didn't recover a lot this year.

Under winter and snow, 2.1.03, the increase in Salaries is …?

MR. BRAGG:

Two point …?

MR. BROWN:

2.1.03, Snow and Ice Control.

MR. BRAGG:

Perfect, I went too far.

Revenue received from municipalities for snow clearing, $1 million; from town

councils for the purchase of salt and sand, $2.2 million; and snow clearing for

national parks, $840,000.

MR. BROWN:

For Salaries.

MR. BRAGG:

Salaries? I thought you said revenues.

MR. BROWN:

Oh, sorry. You skipped ahead but that's good, we'll take that one too.

MR. BRAGG:

I went too far?

MR. BROWN:

For salaries there, 2.1.03.

MR. BRAGG:

Joe, do you want to help me out on this one? I can't find the page.

MR. DUNFORD:

You're asking why there's – just to be clear.

MR. BROWN:

Yeah, there's quite an increase in Salaries and we're budgeting another quite an

increase in Salaries from the actuals and even this upcoming budget.

MR. DUNFORD:

The budget variance from this year versus last year is primarily due to the

extra pay period.

MR. BROWN:

Okay.

I know under Supplies we spent quite a bit more in actuals, but we're still

budgeting the lower end for this coming year.

MR. BRAGG:

(Inaudible) winter maintenance cold mix asphalt and other maintenance supplies

for snow and ice control.

MR. BROWN:

Okay, I guess this is because of Snowmageddon. There's quite the increase. That

was for the actuals for Snow and Ice Control, for Supplies?

MR. BRAGG:

Due to the early start to winter and adverse weather conditions, additional

funding was required for salt and sand. Funding was transferred from other areas

of the department to fund this shortfall.

MR. BROWN:

Okay.

Under Purchased Services there was quite an increase in actuals last year, but

we're only budgeting a million dollars more. What's the reason for that?

MR. BRAGG:

Funding provides for snow-clearing contracts and rental of snow-clearing

equipment. The increase is primarily related to the costs associated with new

Trans-Labrador Highway maintenance contracts.

MR. BROWN:

Okay, so we're adding a bit more money into the Trans-Labrador Highway this

coming snow year for snow clearing? Okay.

Under Maintenance of Equipment I noticed that we paid less Salaries last year in

actuals, but we're budgeting more. Are we getting more employees?

MR. BRAGG:

What

section are you on there now?

MR. BROWN:

Oh, sorry, 2.2.01, Equipment Maintenance.

MR. BRAGG:

Let me see. Funding provides the salary costs associated with the equipment

maintenance program for the government light vehicle fleet, heavy equipment and

the sign shop.

MR. BROWN:

Okay, so we're expecting more employees or they're just moved up a pay scale?

MR. BRAGG:

The increase is primarily related to the additional pay period, which is 27.

MR. BROWN:

Yeah.

MR. BRAGG:

It also reflects any salary plan changes, including attrition management, step

increases and vacancy factors.

MR. BROWN:

Okay.

I noticed there under Purchased Services we spent significantly more money than

what was budgeted. What was the reason for this?

MR. BRAGG:

The funding provides for costs associated with mechanical repairs of road

maintenance equipment and vehicles. Costs can vary based on availability of

in-house staff, complexity of required work, labour and material rates.

MR. BROWN:

I'm guessing a lot of this is because we didn't have enough mechanics, we had to

outsource a lot of the equipment to get fixed elsewhere.

MR. BRAGG:

That happens from time to time.

MR. BROWN:

The same with Revenue. I notice there in Revenue we budgeted to receive $137,000

and we only received $14,000. What was the reason for this?

MR. BRAGG:

OHS-related expenditures for equipment maintenance are 100 per cent recoverable

from WorkplaceNL, $52,000 and the sale of Tourism-Oriented Directional Signage,

known as TODS.

MR. BROWN:

Okay, so that's revenue from the –

MR. BRAGG:

The sale of signage for $85,000.

MR. BROWN:

That's from the sign shop, is it?

MR. BRAGG:

You know the little sign that tells you where the park is at and where the gas

station is at?

MR. BROWN:

Okay, so these are fees collected from tourist operations that post highway

signage. I guess just not a lot was put up this year.

MR. BRAGG:

Yeah.

MR. BROWN:

Very good. I'll relinquish my time to my colleague there now.

Thank you.

MR. PARROTT:

2.1.01, under Supplies there's an extra $84,041 last year. Can you explain where

that came from?

MR. BRAGG:

Savings, you mean?

MR. PARROTT:

No, overrun. It was an extra $84,041 expense.

MR. BRAGG:

Oh, I'm at page 67. All right, Joe, you're going to take this one, please.

MR. PARROTT:

Page 68.

MR. BRAGG:

Is it Purchased Services we're looking at?

MR. PARROTT:

Administration and Support Services, 2.1.01.

MR. BRAGG:

I'm on 2.2. Thank you.

Jordan was sending me too far ahead.

Hang on.

Joe, do you want to take this while I'm getting organized, please.

MR. DUNFORD:

The primary reason for the variance on this one has to do with the purchase of a

PPE for our operators and staff.

MR. PARROTT:

Can you give me a bit of detail on that? I mean with the lack of employees and,

obviously – was there a reason why such a substantial amount of PPE had to be

purchased above the budget?

MR. DUNFORD:

Typically, the PPE can last for a couple of years, so every now and then we will

get a large purchase of PPE. You're referring to the number of staff. We have

vacancies. We have HETs. This is more than just HETs; this is for the operators

as well as for the management and everything as well.

You wouldn't see that vacancy piece here reflected significantly. We did a large

purchase for our PPE and that's where you'd see it.

MR. PARROTT:

2.1.02, Transportation and Communications: What was the nature of the extra

$28,669?

MR. BRAGG:

Could you say it again, please? 2.1.02 …?

MR. PARROTT:

In Transportation and Communications there is an extra $28,669 spent.

MR. BRAGG:

It was an increase in travel requirements of road maintenance crews as per the

collective agreement, in excess of $20,000 from the headquarters, float

operators moving equipment and supplies from depots and employees attending

training sessions to keep mandatory training certificates up to date to be

compliant with OHS.

MR. PARROTT:

The same section, Professional Services: What was the nature of the unbudgeted

$11,770?

MR. BRAGG:

Variance for increased consultation requirements for the summer maintenance

program. This includes various engineering consulting services, including an

inspection service for railways, legal and engineering services required during

the summer season.

MR. PARROTT:

Railways?

MR. BRAGG:

Labrador.

MR. PARROTT:

Okay.

MR. BRAGG:

You should have known that.

MR. PARROTT:

Yeah, I should. I can even tell you the name of it: QNS&L.

Property, Furnishings and Equipment, $2,077. There was nothing budgeted and

nothing budgeted again this year. What was the nature of it?

MR. BRAGG:

Overrun due to purchase of office furniture and equipment.

MR. PARROTT:

The same

section again, Allowances and Assistance: What was the nature of the

dropped balance of $45,717?

MR. BRAGG:

Savings due to fewer than anticipated damage claims and out-of-court

settlements.

MR. PARROTT:

Okay.

The next section, 2.1.03, I know the question was asked but I'd like a little

clarification. What's the nature of the expenditure of the $1,336,600? How much

of that is overtime? There's an increase in the budget this year and I

understand the 27-week pay period, but it's almost a $2-million increase.

MR. BRAGG:

Increased overtime requirements in January snowstorm. Salary costs are also

weather dependent and given the harsh winter backfilling overtime costs. I think

in the opening remarks it was $1.2 million we spent aiding the city.

MR. PARROTT:

And that's where it went, directly to the city?

MR. BRAGG:

Yeah.

MR. PARROTT:

Is there any indication what the department spends on snow and ice control in

overtime? Overall, in the overall salary amount?

MR. BRAGG:

I would refer that to Joe.

MR. DUNFORD:

It can vary year to year based on the weather and events, snowfall accumulation

and all that stuff. I don't have this year's numbers readily at hand, but I can

hand it over to Patrick Morrissey, he will have that number.

MR. BRAGG:

Do you want to ask another question?

MR. PARROTT:

Yeah, I can move on until he's ready.

MR. MORRISSEY:

Can I come back, sorry?

MR. PARROTT:

Yeah, no worries.

Same section, Transportation and Communications, there was a dropped balance of

$55,979 last year.

MR. BRAGG:

Savings due to less than anticipated travel throughout various regional

operations.

MR. PARROTT:

Professional Services, what was the nature of the unbudgeted $26,705?

MR. BRAGG:

Additional expenses due to engineering consulting requirements for winter

maintenance.

MR. PARROTT:

Okay.

Again, under Purchased Services, the nature of the additional $3,041,661. I

guess this question would go more to the ADM. I would assume that from a fleet

management standpoint that it's an automated system that you're using and

there's a periodicity associated with the maintenance on all of the fleet

vehicles. What is the maintenance rationalization on vehicles prior to winter

coming?

MR. DUNFORD:

Yes, we do have an equipment maintenance system that we use to track all of our

heavy equipment fleet as well as our light. There is obviously scheduled

maintenance that we have to go through and all that for our equipment.

For the heavy equipment, what we typically put them through – and we're in the

middle of it right now, certainly – is what's called annual inspections where we

put, for example, a flyer or a snowplow through a rigorous inspection to ensure

that it's ready for the upcoming snow season.

MR. PARROTT:

So based on our early snow season last year and the lack of mechanics that you

have right now, do you anticipate any issues being ready for this snow season?

MR. DUNFORD:

No, I don't at this time. We are still obviously in the middle of our annual

inspections, but we do anticipate them being ready for this coming season.

MR. PARROTT:

Okay.

MR. MORRISSEY:

In overtime in Snow and Ice Control, it's $4.8 million in 2019-20.

MR. PARROTT:

What sections did we highlight?

CHAIR:

All of two.

MR. PARROTT:

2.2.02, Equipment Acquisitions, Revenue - Provincial, what happened to the

$125,000?

MR. BRAGG:

Under Revenues?

MR. PARROTT:

Yes, under 2.2.02.

MR. BRAGG:

No sellable equipment at the auctions for this fiscal and replacement of OH&S

vehicles. So there was no sell at the auction.

MR. PARROTT:

Okay.

2.3.01, Building, Utilities and Maintenance, Transportation and Communications,

what was the nature of the dropped balance of $76,563 last year?

MR. BRAGG:

That was under Transportation and Communications?

MR. PARROTT:

2.3.01.

MR. BRAGG:

The heading was Transportation and Communications, right?

MR. PARROTT:

That's right.

MR. BRAGG:

You're wondering about the $76,000?

MR. PARROTT:

Yes.

MR. BRAGG:

Reduced travel for building maintenance staff based on operational requirements

in their respective regions.

MR. PARROTT:

Under Supplies, same section, why the additional $48,151 last year?

MR. BRAGG:

Increasing first aid and PPE equipment required for building maintenance staff.

MR. PARROTT:

Okay.

Can you explain under Purchased Services, what the $2.1 million was spent on?

MR. BRAGG:

Increasing cost of utilities and fuel and heat of government facilities is

dependent on weather conditions and price fluctuations.

Do you want some utilities history, because I have it all? In '19-'20, it was

$17.3 million; '18-'19 was $16.9 million; '17-'18 was $15.1 million; '16-'17 was

$14.8 million. Maintenance history: '19-'20, $16.8 million; '18-'19, $16.4

million; '17-'18, $15.1 million; and '16-'17, $15.3 million. There's some more

but I didn't want to (inaudible).

MR. PARROTT:

No, that's good. It shows a trend is what I'm looking for.

2.3.02, Leased Accommodations, Transportation and Communications, $18,830, can

you explain what happened there?

MR. BRAGG:

One-time increase for '19-'20 for moving expenditures related to government

leased and owned space.

MR. PARROTT:

Under Supplies, unbudgeted $1,867. Can you explain?

MR. BRAGG:

$1,867 was a minor variance. It provides funding for equipment purchases or

leased office space. It was a minor variance.

MR. PARROTT:

Okay.

The same subheading under Revenue, it's up and down a bit there, can you explain

those numbers?

MR. BRAGG:

In Budget 2018 , Transportation and

Infrastructure was given financial responsibility for all government leases as

of April 1, 2018. During this process, the lease funding from core government

departments was transferred to this department. The variance in the budget was

due to offsetting revenues for lease in Sheshatshiu, which was transferred over

to CSSD for budget '20-'21.

MR. PARROTT:

Thank you very much.

CHAIR:

Mr. Brown.

MR. BROWN:

Yeah, perfect, I'll pick up there.

I'll go back to Snow and Ice Control there, for a quick second, 2.1.03.

Whereas we're quite aware that the highways are contracted out for snow

clearing, was there any increase in cost this year for snow clearing, the

contracts to the two companies that plow the highways?

MR. BRAGG:

The new contracts we would have awarded?

MR. BROWN:

Yeah. Was there any increase in that contract?

MR. BRAGG:

Joe.

MR. DUNFORD:

Yes, there was an increase to the contract for this year. To our recollection it

was around $1.6 million.

OFFICIAL:

(Inaudible.)

MR. DUNFORD:

Yeah, so it was an increase of $1.6 million in the contract.

MR. BROWN:

Okay.

Is that broken into two? Is that a full service for summer and winter, or is it

just winter and there's a summer maintenance contract?

MR. DUNFORD:

That would be for full service.

MR. BROWN:

Full service.

MR. DUNFORD:

Yes. The contracts we put out in Labrador are for summer and winter maintenance.

MR. BROWN:

Okay, so it's one (inaudible).

All right, perfect. Thank you.

Okay, now we'll jump back to – under 2.3.03, Alterations and Improvements to

Existing Facilities.

MR. BRAGG:

2.3.03?

MR. BROWN:

2.3.03, Alterations and Improvements to Existing Facilities.

MR. BRAGG:

Okay, gotcha, perfect.

MR. BROWN:

Okay.

MR. BRAGG:

We're well ahead of the game.

MR. BROWN:

For Salaries, it was budgeted for $500,000, but you're only spending a little –

the Salaries were a little more than half of what was actually budgeted for.

What was the reason for that?

MR. BRAGG:

Due to alterations and improvements, work being delayed during the year, fewer

employees were working on these projects; therefore, less salary charges

incurred during the year.

MR. BROWN:

Okay.

I noticed that we budgeted $49,900 and we only spent $7,490. What was the reason

for the – quite the drop compared to what was budgeted?

MR. BRAGG:

Forty-nine, so what section?

MR. BROWN:

For Transportation and Communications, budgeted $49,000, only spent $7,000.

MR. BRAGG:

Okay.

Savings due to less than anticipated travel or alternations and improvement

projects.

MR. BROWN:

Okay, so we have less projects on the go.

MR. BRAGG:

Less travel.

MR. BROWN:

All right.

Supplies were unbudgeted, but we spent $1,000.

MR. BRAGG:

$1,507 you mean?

MR. BROWN:

Yeah.

MR. BRAGG:

That's a minor variance.

MR. BROWN:

Okay, it was just a variance.

MR. BRAGG:

Funding provides for supplies related to alterations and renovations to

government-owned buildings.

MR. BROWN:

Okay and the trend keeps going. I guess there's a reason why there are less

Professional Services because less projects.

MR. BRAGG:

Yes.

MR. BROWN:

I notice, though, that for Purchased Services we budgeted $3.7 million but we

spent $4 million. What was the reason for that?

MR. BRAGG:

Increase related to the new COVID-19 funding for alterations and improvement

projects cost-shared with the federal government.

MR. BROWN:

Okay.

That's why we're going to spend $8.6 million in the coming year?

MR. BRAGG:

Funding for payments to contractors and other associated costs for building and

maintenance projects.

MR. BROWN:

So we're expecting to do a bit more this year than we did last year?

MR. BRAGG:

Yes. That's the COVID stream.

MR. BROWN:

That's the COVID stream. That would be why we're budgeting $3.8 million for

federal revenue? Is that our cost-shared?

MR. BRAGG:

Offsetting revenue for the new COVID stream funding, yes.

MR. BROWN:

Okay.

Provincial revenue: We did have some money come into here. Where did that money

come from?

MR. BRAGG:

Provincial revenue?

MR. BROWN:

Yeah.

MR. BRAGG:

Revenue anticipated from the sale of properties that no longer meet the program

needs of the provincial government.

MR. BROWN:

Building Maintenance, Operations and Accommodations, 2.3.04, School Facilities:

The budget was $300,000 for Salaries but in actuals it was $527,000. What was

the reason for the jump and then we're not going to budget it in the following

year?

MR. BRAGG:

The increase is attributed to the reallocation of funding from its operating

budget to Salaries. Transportation and Infrastructure staff worked on various

school alterations and improvement projects, and a portion of their salary is

charged to these projects based on an amount of time spent on them.

This is a reallocation of funding between the line objects. The activity does

not represent an increase in the total budget allocation and it does not create

a new position within TI.

MR. BROWN:

Okay.

I'm guessing that's the same thing why there are Employee Benefits as well.

Would that be the same reason for the reallocation?

MR. BRAGG:

I'm going to go with yes on that one.

MR. BROWN:

Is it yes?

MR. BRAGG:

Joe, can you see it?

MR. DUNFORD:

What

section are you on there now?

MR. BROWN:

2.3.04.

MR. DUNFORD:

Which specific line?

MR. BROWN:

Oh, sorry. It's under Employee Benefits, $66.

MR. DUNFORD:

The $66?

MR. BRAGG:

(Inaudible.)

MR. BROWN:

That is? Okay.

MR. MORRISSEY:

This was actually supposed to be charged somewhere else in an administrative

account where there are actual employees.

MR. BROWN:

Okay.

Transportation and Communications: We didn't have anything budgeted last year

but we spent $24,000.

MR. BRAGG:

Funding provides for the travel expense for employees working on alterations and

renovations to the school and increased travel required for school renovation

projects.

MR. BROWN:

Okay.

Supplies: I guess it was a similar project?

MR. BRAGG:

$818?

MR. BROWN:

Yeah.

MR. BRAGG:

It's a minor variance. Funding for supplies for school facilities maintenance

projects. It's very minor.

MR. BROWN:

Under Professional Services we budgeted $2.5 million but we only spent $500,000.

MR. BRAGG:

In this section, funding provides for consultation costs required for school

facilities and maintenance. Savings were identified as projects were delayed

into the next fiscal year.

MR. BROWN:

Okay. That's why we're going to carry it over.

MR. BRAGG:

Yes.

MR. BROWN:

In Purchased Services we budgeted $11 million, we only spent $10.7 million, yet

we're budgeting now for $16 million. What projects do we have on the go?

MR. BRAGG:

Funding for payments of contracts. There's another associated cost for school

facilities maintenance projects and it reflects the new COVID-19 funding stream

cost-shared with the federal government. The savings were identified due to

project delays.

MR. BROWN:

The increase this coming fiscal year is for COVID projects?

MR. BRAGG:

Yes, increase due to COVID funding stream for (inaudible).

MR. BROWN:

Okay.

Under revenue we're getting $11.1 million from the feds. Is that the COVID

money?

MR. BRAGG:

That's the funding allocated for the federal cost-shared revenue COVID stream

funding, yes.

MR. BROWN:

Under 2.3.05, Low Carbon Economy: Last year we budgeted $150,000 in Salaries but

we spent $272,000. Was that for new positions?

MR. BRAGG:

Allocation for salary costs of the low carbon project for 2021. Our staff worked

on various low carbon projects and a portion of their salary was charged to

these projects based on the amount of time spent on them.

MR. BROWN:

Okay so we spent more time at it this year. We're budgeting now $500,000. Is

that because we were expecting to do more low carbon projects?

MR. BRAGG:

Higher than anticipated salary recharge than originally budgeted to protect

proper job costing. Staff are recharging low carbon projects of amount of time

spent on them, which is basically the same answer, right?

MR. BROWN:

Yeah.

MR. BRAGG:

It's an allocation for the new Low Carbon Economy Leadership Program.

MR. BROWN:

Under Transportation and Communications we never budgeted anything last year,

but this year we spent $12,000 and we're expecting $165,000. What was the reason

for this?

MR. BRAGG:

The budget has been rightsized to reflect anticipated travel.

MR. BROWN:

Okay and that's anticipated if back to …

MR. BRAGG:

Yes.

MR. BROWN:

The same with Supplies. We budgeted $50,000, we never spent anything but we're

budgeting $165,000. What's the reason for that?

MR. BRAGG:

The funding provides for consultation costs required in relation to the Low

Carbon Economy Leadership Program.

MR. BROWN:

These are supplies, if required, for any of these projects. Okay.

Professional Services: We budgeted $350,000 but we spent $511,000 and now we're

expecting to budget $780,000. What professional services are we looking at

purchasing for this?

MR. BRAGG:

So funding provides for consultation costs required in relation to the Low

Carbon Economy Leadership Program. Anticipated consultation costs for Low Carbon

Economy projects for '20-'21 increase can be attributed to additional funding

for overall '20-'21. But you're wondering what …

MR. BROWN:

What are we going to do? Is there anything in particular in the hopper that

we're expecting for that much?

MR. BRAGG:

Okay, I'll refer this to the ADM. Joe?

MR. DUNFORD:

Just a quick comment on this. The LCELF budget, this is a relatively new

program, so you're seeing some swings in this budget, primarily due to the first

year we were late getting the budget, and then last year we were really getting

the program running. So what we're seeing here this year is the program is in

full implementation at the moment. We are fully up and running in this program

and we have a number of projects that we are working on right now.

To my recollection, around six projects,

whereas last year we executed two of

the six that we wanted to get done. This year we actually have six in the hopper

that we tendered recently and we are hoping to execute before end fiscal.

MR. BROWN:

Okay, so this is what this budget is for?

MR. DUNFORD:

Yes.

MR. BROWN:

All good, thank you.

CHAIR:

Mr. Parrott.

MR. PARROTT:

2.3.04. The various projects that are ongoing now, are they on budget and on

schedule? Can you provide a list and the status of those projects?

MR. BRAGG:

I would refer that to my ADM, Joe Dunford.

MR. DUNFORD:

We can certainly provide a list of projects that we have under our schools

program, sure. Just a note on that is some of the projects we deliver and some

that the schools deliver, but we can give you a holistic list if you like.

MR. PARROTT:

All the funding comes from the one pool, though, correct?

MR. DUNFORD:

Correct.

MR. PARROTT:

So you would be able to provide a list, even if the school is providing it?

MR. DUNFORD:

Yes.

MR. PARROTT:

Okay, yeah, I'd like that list, please.

Just another, the Low Carbon Economy Leadership Program, you mentioned just then

six projects. Can you identify what those projects are?

MR. DUNFORD:

If you can bear with me for a second I can certainly get them for you. Or if you

can ask another question and then come back to me in a minute or two.

MR. PARROTT:

Yeah, we'll move on, yeah.

2.4.01, under Airstrip Operations, under Supplies, what happened to the

additional $119,977?

MR. BRAGG:

A reduction in supplies requirements for '20-'21. This varies annually depending

on the fuel cost and use as well as other consumables required in any given year

on the airstrip operations.

MR. PARROTT:

Okay.

Just a general question: Can you update us on the status of the Nain airstrip?

MR. BRAGG:

Status of the Nain airstrip.

MR. PARROTT:

Yeah.

MR. BRAGG:

Joe.

OFFICIAL:

(Inaudible.)

MR. BRAGG:

Want me to take it?

OFFICIAL:

(Inaudible.)

CHAIR:

Cory Grandy.

MR. GRANDY:

Thank you.

I can't give you an exact update today. I know the contractor has been in Nain;

we can follow up and give you a more current status update, if that's what

you're looking for.

MR. PARROTT:

Yeah.

I guess, overall air operations with regard to some of the smaller airstrips in

Newfoundland, is there any thought to going IFR on any of these strips so we

have a better air ambulance capability or is it just …?

MR. GRANDY:

Yeah, there's no plan right now in terms of a budget to do a major upgrade.

Now, Joe, I don't know if you can speak more to the regular inspections that

occur and requirements from Transport Canada over …

MR. DUNFORD:

One of the things we are looking at is decommissioning the non-directional

beacons and going with GPS approaches on our airstrips, which provide a better

service overall for those that utilize it. So, yes, we are looking at that. We

are in the middle of doing one at the moment and we are looking at it in the

future year for doing more of the airstrips as well.

MR. PARROTT:

Okay.

Back to 2.4.01 under Professional Services, there was a drop in balance of

approximately $179,900.

MR. BRAGG:

The savings were due to less than anticipated consulting requirements for

airstrip operations for this fiscal year, and that's – in brackets – inspection

and safety management system program, et cetera.

MR. PARROTT:

Okay.

Does Transportation and Infrastructure do the snow clearing on those airstrips?

MR. DUNFORD:

Are you talking about the airstrips on the Island?

MR. PARROTT:

Yeah.

MR. DUNFORD:

We do, yes.

MR. PARROTT:

So where is that budgeted to?

MR. DUNFORD:

That's under the winter maintenance budgets, under each specific depot that is

within that service area. They would do that as part of their run.

MR. PARROTT:

So based on highway classification, Class 1, 2 and 3, what would an airstrip be

classified as for priority?

MR. DUNFORD:

The airstrips are registered strips here on the Island. They're not certified

strips, which has a different service level to them.

When it comes to, say, if there's an air ambulance that we know is coming to the

strip, they will radio us in advance and we will ensure that we have the strip

cleared. We will typically service them off our main run. But, as you know, our

runs can be about two hours long and if it's a heavy snowfall, there's a

potential to have some snow on that runway, so if we know they're coming we will

cycle back and get it done.

MR. PARROTT:

Do you know of any circumstances when you know an ambulance is coming? Doesn't

really sound like a standard.

MR. BRAGG:

My dealings with Fogo Island and the airstrip over there and the maintenance

crew that's over there, there's close working operations between the highways

and the management in the hospital and the airstrip. To get a plane to come in –

a chopper is fairly easy, can probably do a parking lot, but when you get a

fixed-wing come in, they give advance notice because I don't think that's

something that happens at the drop of a dime. Most are located close enough;

they can get in and get the job done.

MR. PARROTT:

2.4.01, Purchased Services, why the drop in balance of $63,000?

MR. BRAGG:

Less than anticipated costs incurred during the Labrador airstrip maintenance

contract.

MR. PARROTT:

2.4.03, Airstrips, Transportation and Communications, what happened to the

unbudgeted $5,969?

MR. BRAGG:

2.4.03?

MR. PARROTT:

Yes, under Transportation and Communications.

MR. BRAGG:

Okay, perfect.

The $5,900 is a minor variance. Funding provides for the travel related to the

construction and restoration of airstrips.

MR. PARROTT:

Purchased Services, last year there was an unbudgeted expenditure of $914,000,

zero budgeted the year before and $387,000 so why the unexpected expenditure and

why the increase in budget from zero to $387,000?

MR. BRAGG:

The increase is to allow for the completion of Nain airstrip resurfacing

project, as tenders were higher than anticipated. It was a maintenance agreement

with the federal government.

MR. PARROTT:

Is that project scheduled to be finished this fall?

MR. DUNFORD:

The Nain resurfacing project? Yes, it is scheduled to be completed this month.

MR. PARROTT:

2.4.03, Property, Furnishings and Equipment, why is there only a fraction of

spending in this allocation?

MR. BRAGG:

These funds were needed due to reallocation to purchased services during the

year as for the contract payments for the completion of the Nain airstrip

resurfacing project.

MR. PARROTT:

I'll go back and ask Mr. Dunford if he has an answer to the question on LCELF?

MR. DUNFORD:

Lloyd, can I get you a list on that one or can I send you the list in advance?

MR. PARROTT:

Yes you sure can, absolutely.

MR. DUNFORD:

Or after this. My apologies, I don't have it readily available at the moment

with me. The spreadsheets I've got here are slightly outdated so I'd rather give

you accurate information.

MR. PARROTT:

No, that's fine.

Just one more question on the LCELF. Obviously, it's a new program and we have

people associated with that. How many people work directly in that department?

MR. BRAGG:

What

section are you on my good man?

MR. PARROTT:

2.3.05 is the question. This is more of a general question specifically around

the Low Carbon Economy initiative. We have $500,000 in Salaries. Can you

indicate how many people are working under that initiative?

MR. DUNFORD:

So we have one manager assigned to the LCELF. Then what we have are other

engineers within the Building Design group that contribute to project management

of those projects. So, technically, it's one associated individual to manage the

budget itself, but there are multiple engineers and technicians throughout the

department that would be charged against that budget.

MR. PARROTT:

So it's a reallocation of funding through the budget to other departments. Is

that a fair statement?

MR. DUNFORD:

No, it's within our department, it's not other departments; it's ours.

MR. PARROTT:

But it's just $500,000. It sounds to me like you're saying it's a cost-shared

salary expense.

MR. GRANDY:

(Inaudible.)

MR. PARROTT:

Wave again.

CHAIR:

Cory Grandy.

MR. GRANDY:

Thank you.

Just to add a little bit, I guess, extra. On most of the activities that we've

been talking about here for alterations and improvements in schools, the LCELF

or alterations and improvements in government-funded buildings, there are no

dedicated salaries typically attached to those activities. We have project

managers and technicians of various sorts on staff and they charge their time

against the salary budget for these activities.

MR. PARROTT:

Yeah, that's my question, okay.

MR. GRANDY:

So there's no – Joe mentioned we have a manager that's assigned to LCELF, but

generally there are no specific positions attached to an individual activity in

the Estimates.

MR. PARROTT:

Perfect, thank you.

We finish right there, is that correct, on 2? We're only doing

section 2, is

that correct?

CHAIR:

Yes.

MR. PARROTT:

Yeah, no more questions.

CHAIR:

Before we continue, we'll take a 10-minute break and we'll come back and finish

this section. Is that okay? Okay.

Recess

CHAIR:

We'll continue with our Estimates of Transportation and Infrastructure.

We're on

section 2.1.01 to 2.4.03, Operations.

Mr. Brown.

MR. BROWN:

Under this section, under Administration and Support Services, 3.1.01.

CHAIR:

No, we're still on two.

MR. BROWN:

Oh, we're still on two. Okay.

Sorry, I thought we were moving on to the next one. My apologies, I have no

other questions for this section.

CHAIR:

Mr. Parrott.

MR. PARROTT:

No questions.

CHAIR:

Mr. Lane.

MR. LANE:

Yes, thank you.

I have a number of questions, actually. They're all general though.

I'm just wondering, given the issues with climate change and so on, do we have a

policy now that when we replace culverts and stuff, that we're using larger ones

to accommodate the new reality that we're facing? Is that something we're doing?

MR. BRAGG:

I'm going to go with a quick answer of, yes, from what I've seen. So, yes, is

the answer.

MR. LANE:

Okay, thank you.

I know it's been talked about but I didn't know if we were actually – at one

point we kind of weren't and, of course, people were saying they're throwing

good money after bad, but I wasn't sure if we actually had made that shift.

Would that be the case of when we have a flood or something that gets washed

out, we replace it with larger ones? Or is that all of it now, so we're just

replacing a bridge or something now or whatever, it's all going to done –?

MR. BRAGG:

Even additional ones are dry.

MR. LANE:

Pardon?

MR. BRAGG:

We're even putting in dry ones that are elevated above the other ones so that

when you get the extreme high water levels, the dry one is ready to roll.

MR. LANE:

Good. Okay, perfect.

I've had a couple of people mention to me about highway signage in disrepair. I

noticed a couple of times myself actually. There's one somewhere between here

and Whitbourne – I can picture it but I can't tell you where – where it was a

big sign that was sort of cracked right in half.

Do the highway workers – if you see one, do you fix it right away? Do you wait

for a complaint or every so many years you do a review? How does that work in

terms of highway signage replacement?

MR. BRAGG:

Joe will answer because he's ADM.

MR. DUNFORD:

Paul, to answer your question, we conduct maintenance throughout the summer

maintenance season in stages or in phases. Early on in the season we do

temporary repair for asphalt, culvert cleanouts and stuff like that. When

asphalt becomes available we spend June, July and August heavily focused on

asphalt. Then in the fall, for September, October and a little bit of November,

depending on the weather, we focus on what I'll call periphery transportation

infrastructure, so signage and stuff like that.

MR. LANE:

Okay.

MR. DUNFORD:

The one exception to that would be TODS. TODS we do put a strong focus on in

June. As you know, many of the tourism operators ramp up the last week of June.

Our goal is to have all of the TOD signs up by the end of June to ensure that

the tourism operators have the benefits from that.

MR. LANE:

Okay, thank you.

This goes under the Snow and Ice Control area. I'm just looking for some

confirmation. I know we had an issue – I can't remember if it was last winter or

the winter before – where there were a couple of the ambulances that got stuck

on the Trans-Canada somewhere between here and Whitbourne for an extended period

of time.

Do we now have that matter resolved in terms of communication or whatever? I

know the policy before was if there's an emergency, a plow will go in front of

it. That's one piece which obviously is important. But if an ambulance had the

emergency, they drove from Whitbourne to St. John's, now they're going back to

Whitbourne – it might not be an emergency, but if they're stuck on the

Trans-Canada Highway and there is an emergency a couple of hours later or

whatever and they can't get to it, then that's still an emergency. Has that

whole issue been resolved with the ambulances?

MR. BRAGG:

If it's an extreme weather event, you can't see – as the old saying – your hand

before you and we get the ambulance into the city, people have to look at their

own safety when it comes time to go back. Sometimes good common sense must

prevail.

Number one priority will always be get the patient to the hospital facility that

it needs to get to. If you had Snowmageddon, for argument's sake, that fell from

Whitbourne in, there's a good chance that we probably wouldn't have gotten in

that evening with the amount of snow that was falling. It might have been

diverted to St. John's because sometimes they just cannot physically do it.

I don't know if you've ever been on a plow or driven in a snowstorm when it's

zero visibility. It's not the best time to be on the road. At these times people

should practice to stay home. One would hope – and I know hope, as Dr. Haggie

said before, should be a girl's name – that if you can get the patient safely to

the hospital, the next thing should be the security and safety of the drivers of

the ambulance. There should be another ambulance. Most hospitals have two, if

not three, ambulances that would be there. One would be committed.

Extreme snow event – I've been out in them. I don't advise anybody to be in them

because it's your life that's on the line and you wouldn't want to see anybody

stuck. There may be a time in everybody's life that they drive and they wish

they never. You've heard the conversation eat your heart? That's what you do at

that time; you eat your heart because you cannot see a thing.

MR. LANE:

Thank you, Minister.

I appreciate that and I do agree. I'd have no issue with any of that, it makes

perfect sense to me, provided though that there is indeed another ambulance

available. If the ambulance is in St. John's and now there's no ambulance

coverage – I'm using Whitbourne as an example because I think that's one that

happened; it could be anywhere – as long as part of this whole protocol is that

we have some assurance that there is emergency response available, if needed, in

all areas, then that's no issue.

MR. BRAGG:

No and you would treat that as any emergency. Most towns out there would have

emergency plans to deal with such events; I would think the health care

facilities would have emergency plans, as well, should that happen.

It could be something where three ambulances were dispatched – we'll use the

Clarenville hospital. That might clean out the Clarenville Hospital. They may be

able to find an ambulance then from Glovertown to come in and pick up so they

wouldn't be left – do you know what I'm saying? You would hope there are plans

behind plans.

MR. LANE:

Yeah, I get it and –

MR. BRAGG:

And communities, it's definitely the key. Yeah.

MR. LANE:

– I would hope so too, but as you say, that's …

All right. As memory serves me, at some point – maybe last year, it could've

been before that, because if you're here long enough, years run into years and

everything else, you lose track, but at some point not too far in my brain I can

remember there was going to be this asphalt-testing project where we paved a

kilometre with this mix and then another kilometre with a different mix and so

on.

Did we ever come to any conclusion from that, or is it still ongoing or what's

the deal?

MR. BRAGG:

My deputy minister will take this question.

MR. GRANDY:

So we're into, I think, now our third year of testing after the pilot. I think

this one, we took our results this year which would've been our third test. We

have not seen anything conclusive yet in the wear rates of those test strips. I

think when we did it we said it would take a couple of years before you would

start to see anything.

Basically, at this point in time, we're into year three, there's nothing

conclusive that one particular mix design was working better than the others.

With the exception of, I think, over the last, I'm going to say, five years, we

know now that on high volume, high-speed roads, the use of the polymer additive

in the liquid asphalt is the thing that gives us the best result. So we're using

polymer-based liquid asphalt now on all high-volume …

MR. LANE:

Outer Ring Road, for example.

MR. GRANDY:

Yeah.

MR. LANE:

Yeah, okay.

MR. GRANDY:

Which is (inaudible).

MR. LANE:

Although it seems like there's always construction there in the meantime.

MR. GRANDY:

So, yeah, it appears that way sometimes, but we're actually not replacing the

same lane or the same

section year over year. Now, you won't get as much life on

the Outer Ring Road as you will on the Burin Peninsula Highway, just because of

the traffic volume.

MR. LANE:

Yeah, makes sense. Okay, thank you.

Again, under the Snow and Ice, and this kind of ties into the issue about the

trouble in getting heavy equipment mechanics and so on. I know a couple of years

ago, for sure, it was a public issue, if you will, where there were a number of

depots, particularly around the Avalon, for sure – Donovan's comes to mind –

where we were like at 30 per cent or something like that of equipment on the

road and 70 per cent off because the vehicles were down for various reasons.

The question, I think, might have been asked by my colleague, to some degree,

but I'm just wondering, we're confident that we've got that resolved or we're

going to be in good shape this year?

MR. DUNFORD:

Obviously, one of the things that impact the mechanical downtime of a fleet, as

well, is not just the number of mechanics that you have but also the age of

equipment and the number that we have available.

One of things that we've done going into this snow clearing season is we've made

a significant investment into the fleet. We're currently in the process of

receiving 62 new flyers to be dispersed out to the various depots throughout the

province. We also purchased 20 loaders to help out our fleet.

If you look at that, that's 82 new pieces of equipment. In addition, in December

of 2019, we purchased five new plows, as well, at that time. If you look at the

investment in the fleet over the last year, you're talking basically 87 new

pieces of equipment.

With that investment into new equipment, we do anticipate that the downtime

associated with the fleet will be less this year, which will also reduce demand

on the HETs themselves.

CHAIR:

Mr. Lane, your time has expired unless it's the will of the Committee to provide

additional leave.

MR. LANE:

I thought I had leave because we've gone back a couple of times and I've only –

CHAIR:

Additional time.

MR. LANE:

Okay. I've just got a couple.

I'm wondering about the terms of alterations or improvements to existing

disabilities. I know there's this rule, if you will, I want to say 1984, it

might be '85 or something, that if a building is older than 1984 or 1985,

whatever that number is, it might be 1987, 1980-something anyway, that it does

not have to be accessible, which, personally, I disagree with that rule. But,

anyway, I can understand, perhaps to some degree, there might be some pressure

and an unwillingness to address that with private business, perhaps, but

certainly when it comes to public buildings, I think it's disgraceful that that

rule would even be considered to be applied to a public building.

I'm wondering, where are we with our public buildings, all of our public

buildings, when it comes to those buildings being accessible? Not just in terms

everything else. Is that something that we're actively working on and

completing? Are we there now or …?

MR. BRAGG:

I'm curious, are you aware of any buildings that would fall under our division?

Because I know Service NL is the regulatory body dealing with that. In my

travels throughout the province for the last number of years, I've yet to come

across a building with – again, I don't always pay close attention, but if you

are aware of one of our buildings that needs to be upgraded, by all means, give

it to us because I think everybody should have access to every building that the

province owns.

MR. LANE:

Minister, I can tell you that up until recent times, for example, even the Arts

and Culture Centre here wasn't accessible. The Arts and Culture in St. John's in

terms of the blue-space parking and everything else, they weren't up to standard

up until a couple of years ago when – I'll say – a disability advocate put a lot

of pressure and met with the school boards that a lot of the schools weren't

even properly accessible.

I know it's been an ongoing issue and I know that some of the reasons that have

been given in the past: Oh, well, this building is older than 1984, therefore we

don't have to meet those standards. That's why I asked and I will certainly ask

for you, Minister, to look into that.

MR. BRAGG:

Sure.

MR. LANE:

To make sure that all of our public infrastructure, our buildings are accessible

to persons with disabilities.

MR. BRAGG:

No worries.

MR. LANE:

Yeah.

The last question I had, I'm just wondering, can you give us any update on

what's happening – I guess this would fall under the Low Carbon Economy piece –

in terms of – I know under the rate mitigation plan, I suppose, that was

announced at some point by Minister Coady when she was minister of Natural

Resources, she talked about electric vehicles, which would require charging

stations all over the province, obviously, and she talked about the

electrification of buildings and all this good stuff. It all sounded wonderful.

What has been done or what is the plan to actually start electrifying all of the

public buildings in the province? What about the charging stations? That's my

last question.

MR. BRAGG:

I think the charging stations were with Municipal Affairs when I was there. I'm

not sure if that's with us now or not, the actual infrastructure for that, but

places were identified throughout the province to put in the charging stations.

My understanding from the company named Tesla; they were going to actually

piggyback and put one there for their own vehicles at no cost to the province

whatsoever. I know that's ongoing. The actual status of these contracts I'm

thinking is MAE, an environmental question that may answer that.

Electrification of our buildings – Joe, was that you? Joe will fill us in on

what's going on there.

MR. DUNFORD:

The component of the LCEF that we have is a piece of the larger budget which, as

the minister mentioned, there's some with the Environment and Climate Change

group as well. The LCEF budget that we have is almost entirely dedicated to

electrification of boilers – or buildings, sorry.

If we have a system that's at the end of its useful life and it's ready for

renewal, instead of putting an oil-fired boiler in we'll put in an electric

boiler. That's what those projects that Mr. Parrott had questioned about

earlier, the six projects; they're related to electric boilers and

electrification.

MR. LANE:

In terms of the numbers then – the number of buildings that would need to be

done versus what is done – any idea?

MR. DUNFORD:

I don't have that list on hand at the moment, but when we're looking at it we're

looking at it from a capital renewal point of view, so is the system at the end

of its useful life? If we have, say, 850 buildings and 700 of them may be on a

fuel-fired boiler, so to speak – I'm not saying that's correct but just for

argument's sake – those could be brand new boilers. So we wouldn't really

consider those at this time when it's a new system or a relatively new system,

we're looking at the ones that are at the end of useful life.

MR. LANE:

Thank you.

CHAIR:

We'll now vote on this section.

I ask the Clerk to recall the section.

CLERK:

2.1.01 to 2.4.03 inclusive.

CHAIR:

Shall 2.1.01 to 2.4.03 inclusive carry?

All those in favour, 'aye.'

SOME HON. MEMBERS:

Aye.

CHAIR:

All those against, 'nay.'

Motion carried.

On motion, subheads 2.1.01 through 2.4.03 carried.

CHAIR:

We will now turn to the next section.

CLERK:

3.1.01 to 3.6.02.

CHAIR:

Shall 3.1.01 to 3.6.02 inclusive carry?

Mr. Parrott.

MR. PARROTT:

Just some miscellaneous questions first: Cold patch versus recycled asphalt

versus hot patch, what's the effectiveness and cost difference?

MR. DUNFORD:

Cold patch is very much a temporary repair. It's something that's meant to

remove the hazard and safety issue at that time. The intent would be to come

back and do a more permanent repair.

The hot asphalt and recycled asphalt are what we would use for permanent

repairs. Ideally, we would have hot asphalt straight from a plant and that would

give us the optimal repair. In situations where hot asphalt may not be available

to a particular region, we will use the recycled asphalt. A good example would

be down the Burin Peninsula. We use our asphalt recycler down there quite a bit

because there's not necessarily a plant that's stationary down there as compared

to, say, Clarenville, which has J-1 or something like that, they have stationary

plants.

Ideally, yes, we do prefer to use hot asphalt. We get the greatest longevity out

of it. We typically see five years if it's done properly.

Whereas with the cold

patch, it's more a matter of months or weeks in some circumstances.

MR. PARROTT:

How far is too far to travel to get hot patch?

MR. BRAGG:

It depends on the vehicle you're bringing it in. If you have a truck that uses

the heated dome, you can go a lot further than one that doesn't have the heated

dome, so depending on the location and time and who gives you the asphalt mix.

Some plants are hotter than others, as you're probably aware.

MR. PARROTT:

For clarification purposes, if we're spreading – I would assume that the

Transportation and Infrastructure truck carries probably around 11 to 12 tons of

hot asphalt. If the plan is to go to an area and deliver that amount or close to

it, how far would we travel to get it, I guess, is the question.

I ask the question specifically because I know of districts throughout the

province where asphalt plants have been set up within a 50-kilometre radius and

it's been too far to travel to get hot asphalt. I also ask the question because

I have experience in paving and I would suggest that 50 kilometres is not too

far to travel. It's very ineffective to put cold patch in these sections year

after year and it happens year after year.

Again, I'll ask the question: How far is too far to travel? For argument sake

let's say four tons of hot asphalt.

MR. BRAGG:

I would think the travel would be at the discretion of the supervisor for the

depots, what he felt or she felt would be too far. In my district it's an hour

run on the ferry. You can't put that in kilometres because it's an hour run on

the ferry but you put it to time. Lots of times the truck would come from Grand

Falls or Gander, so that's 2½ hours right there.

Now, no doubt the closer you are to the plant, the better the mix, the better

you can work with it. When a lot of this is shovel work that is being done,

because we don't have the spreaders for doing potholes, the closer the better.

It depends on who is doing the mix – and you would know this – because I've

heard that some contractors have a very cold mix which their equipment can

easily do, but when a lot of it is shovel work and small rollers, they may say –

but to your point, is cold mix the right thing to do in August? Most certainly

not, in my opinion, but I'm not there that day and that may be the quick fix

that you get into that day.

MR. PARROTT:

We'll go to liquid asphalt, and understanding that there two liquid asphalt

storage facilities in the province; one obviously that utilizes the polymer and

one that doesn't. We've seen some work stop recently because of the shortage of

liquid asphalt. Can somebody explain how that happened?

MR. BRAGG:

Cory will take that.

MR. GRANDY:

Both suppliers are capable of providing the polymer, but it depends on what

they're providing at that point in time. When we tender a project, we tender it

to a general contractor and it's up to the general contractor to manage his

subcontractors and the supply chain in his contract.

Unfortunately, we had the situation on some of our bridge rehabs here in the

metro area, including the one on the TCH just east of Foxtrap, where the

subcontractor to the bridge rehab contractor, his supplier of liquid asphalt was

supplying a non-polymer asphalt to our contractor in Labrador at the time; they

weren't able to make the switch to give him the polymer required for the bridge.

We went through a pretty extensive review in terms of what our options were. For

a day, we kicked around whether we would change the requirement in our contract

and allow the non-polymer to be used. I think after we debated that one around

and making sure we get the best bang for our buck, we decided not to allow that

change and to stick with the polymer liquid asphalt. It ended up in a further

delay on getting asphalt on that bridge.

MR. PARROTT:

Did anyone from the department reach out to either of the suppliers?

MR. GRANDY:

That comes into, I'll say, the responsibility of the contractor in managing his

supply chain. I'm not aware personally that anyone, as part of our management

team, reached out to the other supplier, respecting that it's up to the

contractors to have the relationship with their suppliers.

Was there polymer available in the other supplier? Perhaps, and I can't finish

even that conversation without smiling a bit because just because it was

available doesn't mean that a particular supplier would have sold it to a

different contractor, because it's a very unique kind of industry at times.

MR. PARROTT:

Yeah, I would make the statement that polymer was available from the original

supplier and if you check into it you'll find out that that's correct.

MR. GRANDY:

Now, we did call the first supplier. We did do that, Mr. Parrott. Someone from

our materials lab did call the original supplier and we can only take it at face

value that they couldn't provide.

MR. PARROTT:

So as a project goes out – and we've seen it year after year we've seen, as an

example, people in my district, J-1, we've seen municipal, we've seen recently

Farrell's and different companies get an abundance of work and not have the

ability to – and Johnson's in Labrador and so on and so forth – we've seen that

the projects haven't been able to be completed in a year.

So two questions, really. Just a little bit of a

preamble. These projects are

awarded, obviously, based on necessity and necessity is based on condition of

the road and safety for people here in Newfoundland and Labrador. So if it's a

safety concern, then delaying these projects ought to be unacceptable,

obviously, 100 per cent. We've got projects that have been delayed over a year.

I assume, based on those delays, that these people are paying penalties – that's

the first question. Are they paying penalties, and what amount of penalties was

paid in 19-20?

I assume that the plan for 2020 is for these companies to pay penalties. If it

is based on safety, why are we only awarding these projects based on bottom

dollar, if they aren't being completed?

MR. BRAGG:

So I guess I could start, then I'll turn it over to Cory or Joe to finish it.

So you're quite aware in the construction industry, in general, whether it be

paving, roadwork, water and sewer, buildings, there are always years that the

job doesn't get completed; weather conditions, COVID this year could be used, as

you're quite aware, a company you're familiar with, we had to cancel a tender

because of their COVID concerns and we had to go back and retendered. So is it

fair to penalize – and you would know exactly where I'm talking about – the new

company because the tender was just called now at the first week of October,

which they're not going to get finished this calendar year because the time just

will now allow it? Is it fair to penalize that company based on that specific

situation that both you and I are quite clear on?

So penalties become a thing that it's easy to say we're going to penalize

people, but then when the bid reflects the penalty, in that penalty – and you

referred to Johnson's and you referred to J-1 and everyone else, so for us to

have enough contractors out there to do all these jobs would mean most of these

contractors would fail in the second year because they just – you were in

contracting, you know how this works, right.

So if there were way more contracts than jobs, we would have a lot more people

in this province unemployed and facing bankruptcy. So penalties, things that

we've talked about it, I'm not sure, Cory, you can tell me if we implemented any

penalties or not. But I've looked at it from the side of – again, yourself, as a

former contractor, and quite aware of what's going on – when you bid it, if you

know you can't finish, you're going to bid it up because you know there's a

penalty. So you're going to bid that penalty amount, which means the province

actually pays your penalty, or the penalty for you back through them, to be

fair.

I'll let Cory expand on that if you like.

MR. GRANDY:

I may add a little bit of additional commentary to that, I guess.

The intent of our penalties is to incentivize contractors to only take on work

that they can complete. It's not our intent, as the minister said, to drive

someone out of business because of the penalty. We only want the penalty to

incentivize them to complete in a timely way.

We made a fairly significant change to our liquidated damages clauses in our

contracts starting last year, early implementation maybe the year before, but in

a big way last year. It made a tremendous difference in the amount of carry-over

that we had last year, say, relative to three or four years before that. I don't

have numbers in front of me to be able to speak to it, but in some years it

wouldn't have been unusual to have over $10-million worth of incomplete work

that would carry over to a following season. Last year, that was down to a

couple of million.

We'll also work with the contractors. Just because they were delayed doesn't

necessarily mean we're going to impose the penalty because there might be very

good reasons for the delay. Sometimes it's things that we had changed as the

owner. It might be the result of asking for them to complete additional work on

another contract that would prevent them from getting to another contract. So we

have to be very, I guess, strategic and willing to work with our vendors to try

and get the best value for money out of everything that we do. We actually

didn't have to impose that much in the way of penalties because the penalty

clauses, the liquidated damages clauses were working the way that they intended.

Now, at the start you mentioned 2020, at the early part of the tendering season,

so back in April in the early weeks of the shutdown, and wanting to get the

roads program out, we had no idea at that point in time that the roads program

would be as successful as it turned out to be – successful in terms of

productivity. We had some contractors that were in discussions that were

debating whether they would even bother to open their doors this year.

Early on, Minister Crocker, at the time, was meeting with the Heavy Civil

Association on a weekly call and I attended most of those teleconferences. Early

on, I think the minister said to the Heavy Civil Association and the contractors

that are part of it that we would have to be very careful about how we go about

imposing penalties this year, not knowing how the season would go at all. I

think at that point in time we even wondered would we have a season.

While our contracts still allow for the liquidated damages, whether we should be

imposing them this year, given some of those early statements that were made to

the industry in April, I think that's a conversation that will continue into the

fall and see where we're to.

For the most part, we're seeing our contractors put in a good effort. Some

contractors have a lot of work; others not so much. But I think right across the

board, the contractors have made really good progress this year. We'll have some

decisions to make around penalties as we conclude the season.

Okay. Thank you.

CHAIR:

Mr. Brown.

MR. BROWN:

Thank you.

3.1.01, Administration and Support Services, I noticed there for Salaries

budgeted $789,000, but the actuals were $591,000. Was this through attrition?

MR. BRAGG:

Let me see, increase of primary related to the additional pay period, number

one, and also reflects salary plan changes including step increases, attrition

management and a vacancy factor.

MR. BROWN:

Okay, so there was a bit of attrition, but then there was also increase in pay

for this? Because the Salaries is quite the jump from actuals of last budget.

MR. BRAGG:

We have an extra two-week pay – it was a 27-week pay period – and salary steps.

MR. BROWN:

Okay.

Employee Benefits: Nothing was budgeted, but it was paid out there in actuals.

MR. BRAGG:

Overrun related to the registration fees for Transport Canada, TAC and

Newfoundland and Labrador Construction Safety Association.

MR. BROWN:

Okay, so that was for people, part of their administration – they're a

professional group?

MR. BRAGG:

Yes, professional group.

MR. BROWN:

Okay.

For Transportation and Communications, there was budgeted $45,500 and $57,300

was in actuals, but then we're going to keep roughly the same there budgeted.

What's the increase there for reasoning?

MR. BRAGG:

Higher than anticipated travel requirements for both soil labs and Highway

Design staff. And the budget was rightsized.

MR. BROWN:

Okay, so it was under budgeted last year for the work that had to be done, is

it?

MR. BRAGG:

Yes.

MR. BROWN:

All right.

Supplies: There was an increase in Supplies in this section.

MR. BRAGG:

We're over due to the one-time increase in engineering supplies for the soil

labs.

MR. BROWN:

That's for the soil lab?

MR. BRAGG:

Yes.

MR. BROWN:

Purchased Services: There was a decrease in Purchased Services and we're going

to decrease the budget next year – or this budget. What's the reason for less

Purchased Services? Is there a project ending?

MR. BRAGG:

A reduction in anticipated repairs and maintenance costs in the soil labs

division. This was reduced in order to rightsize the budget.

MR. BROWN: