[House Hearing, 116 Congress]
[From the U.S. Government Publishing Office]
SMART CONSTRUCTION: INCREASING OPPORTUNITIES FOR SMALL BUSINESSES IN
INFRASTRUCTURE
=======================================================================
HEARING
before the
SUBCOMMITTEE ON CONTRACTING AND INFRASTRUCTURE
OF THE
COMMITTEE ON SMALL BUSINESS
UNITED STATES
HOUSE OF REPRESENTATIVES
ONE HUNDRED SIXTEENTH CONGRESS
FIRST SESSION
__________
HEARING HELD
NOVEMBER 19, 2019
__________
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Small Business Committee Document Number 116-060
Available via the GPO Website: www.govinfo.gov
______
U.S. GOVERNMENT PUBLISHING OFFICE
38-316 WASHINGTON : 2020
HOUSE COMMITTEE ON SMALL BUSINESS
NYDIA VELAZQUEZ, New York, Chairwoman
ABBY FINKENAUER, Iowa
JARED GOLDEN, Maine
ANDY KIM, New Jersey
JASON CROW, Colorado
SHARICE DAVIDS, Kansas
JUDY CHU, California
MARC VEASEY, Texas
DWIGHT EVANS, Pennsylvania
BRAD SCHNEIDER, Illinois
ADRIANO ESPAILLAT, New York
ANTONIO DELGADO, New York
CHRISSY HOULAHAN, Pennsylvania
ANGIE CRAIG, Minnesota
STEVE CHABOT, Ohio, Ranking Member
AUMUA AMATA COLEMAN RADEWAGEN, American Samoa, Vice Ranking Member
TROY BALDERSON, Ohio
KEVIN HERN, Oklahoma
JIM HAGEDORN, Minnesota
PETE STAUBER, Minnesota
TIM BURCHETT, Tennessee
ROSS SPANO, Florida
JOHN JOYCE, Pennsylvania
DAN BISHOP, North Carolina
Adam Minehardt, Majority Staff Director
Melissa Jung, Majority Deputy Staff Director and Chief Counsel
Kevin Fitzpatrick, Staff Director
C O N T E N T S
OPENING STATEMENTS
Hon. Jared Golden................................................ 1
Hon. Pete Stauber................................................ 2
WITNESSES
Mr. Lennart Andersson, RA, Director of Virtual Design,
Construction & Operations (VDCO), LiRo Group, Professor, Pratt
Institute, New York, NY, testifying on behalf of the American
Society of Civil Engineers (ASCE), the Construction Institute
(CI), LiRo Group, and Pratt Institute.......................... 5
Mr. Ryan Forrestel, President, Cold Spring Construction, Akron,
NY............................................................. 6
Mr. Chris Shephard, Vice President, Construction Solutions Group,
Trimble, Inc., Dayton, OH...................................... 8
Mr. Phillip Ogilby, CEO and Co-founder, STACK Construction
Technologies, Cincinnati, OH................................... 10
APPENDIX
Prepared Statements:
Mr. Lennart Andersson, RA, Director of Virtual Design,
Construction & Operations (VDCO), LiRo Group, Professor,
Pratt Institute, New York, NY, testifying on behalf of the
American Society of Civil Engineers (ASCE), the
Construction Institute (CI), LiRo Group, and Pratt
Institute.................................................. 24
Mr. Ryan Forrestel, President, Cold Spring Construction,
Akron, NY.................................................. 31
Mr. Chris Shephard, Vice President, Construction Solutions
Group, Trimble, Inc., Dayton, OH........................... 35
Mr. Phillip Ogilby, CEO and Co-founder, STACK Construction
Technologies, Cincinnati, OH............................... 41
Questions for the Record:
None.
Answers for the Record:
None.
Additional Material for the Record:
ABC - Associated Builders and Contractors.................... 49
Autodesk Construction........................................ 50
SMART CONSTRUCTION: INCREASING OPPORTUNITIES FOR SMALL BUSINESSES IN
INFRASTRUCTURE
----------
TUESDAY, NOVEMBER 19, 2019
House of Representatives,
Committee on Small Business,
Subcommittee on Contracting and Infrastructure,
Washington, DC.
The Subcommittee met, pursuant to call, at 10:03 a.m., in
Room 2360, Rayburn House Office Building. Hon. Jared Golden
[chairman of the Subcommittee] presiding.
Present: Representatives Golden, Chabot, Balderson,
Hagedorn, and Stauber.
Chairman GOLDEN. Good morning, and thank you for joining
us. I look forward to having a good conversation here about the
future of the construction industry and how we might be able to
make some necessary improvements.
I think we all know that America's infrastructure needs
some pretty focused investment in order to catch up to where we
should be. And everyone knows the statistics from the American
Society of Civil Engineers, both nationally and in their
specific home states. It lays out a clear map for improvement
and where we are falling behind.
This is one reason why there must be a strong
infrastructure agenda in Congress, and in particular, one that
focuses on investing in outdated roads, bridges, rails, water
systems, housing. I could go on and on.
Doing this not only increases opportunities for small
businesses in construction, manufacturing, engineering, and
many more small businesses, but it also will help create good
paying job opportunities and increase our competitiveness as a
Nation.
The current administration I think shares this
understanding that we need to invest in our infrastructure and
that this should be a top priority, as well I think as both
parties in Congress. So really sometimes we are not sure what
is holding us back but we need to continue to have these
conversations and be pushing our leadership to go ahead and
move forward with an infrastructure spending package. Not just
roads and bridges. We need a comprehensive infrastructure
package that incorporates information technology and
communications so that our Nation not only has the fastest and
most efficient infrastructure, but also the most modern.
With the Internet, things like artificial intelligence and
cloud computing offer new opportunities for smart applications
in many new industries, and old.
In particular, technology has the ability to reshape the
construction industry by creating digital construction
solutions where small firms can help lead the way.
From GPS-enabled equipment to advanced digital modeling,
smart tools are making projects less expensive more
ecofriendly, and more efficient. More importantly, digital
construction helps level the playing field for small
contractors. Through investing in digital tools, small
businesses can write lower bids and compete for larger
projects.
Smart tools also pay for themselves. Increased business and
timelier project completion allows small contractors to bring
in more business. Early adoption of digital technologies
creates a competitive advantage. In fact, almost 70 percent of
owners say poor performance is the single biggest reason for
project underperformance and only 25 percent projects have come
within 10 percent of their original deadline in the past 3
years.
Digital tools also give contractors access to powerful data
that can help them make informed decisions about materials and
design to make structures safer. Smart buildings enabled by
digital tools help civil engineers, developers, and architects
reduce a building's carbon footprint and increase
sustainability.
Inspecting structures, like bridges and tall buildings was
once a dangerous, time-consuming task. Now, prop tech sensors
are built into buildings that can help assess when there is
damage and when buildings need to have some maintenance.
Drones also offer a way to survey buildings and terrain
after natural disasters is just one example. These cutting-edge
solutions cut costs and save lives.
I hope that today's discussion will help shed a little
light on the many ways that digital construction can benefit
small businesses and encourage broader adoption of digital
tools.
I want to thank each of the witnesses for joining us today,
and I look forward to your testimony.
I would now yield to the Ranking Member, Mr. Stauber, for
an opening statement.
Mr. STAUBER. Thank you, Chair Golden. And thank you for
holding this important hearing. It is a pleasure to work with
you on this Committee.
On our modern day worksites, you might see workers studying
a 3D printed model instead of blueprints, or remotely operating
an autonomous crane in the safety of an office. Stakeholders
might prefer a virtual reality or aerial tour instead of
physically touring the project. No longer limited to R&D
engineers, construction workers at all levels are harnessing
digital technologies to optimize productivity, quality, and
safety.
These technologies have brought the worksite into the hands
of its operators. Smartphone apps can not only link employees
to each other but also enable access to vital project data
stored in the cloud. The data may be sourced by drones,
artificial intelligence, virtual reality, and 3D modeling.
Digitized construction technologies and processes can have
a significant impact on a construction company's productivity,
but many small firms lack the resources to invest and maximize
potential of these technologies.
Similarly, regulatory and administrative burdens have
restricted implementation across Federal, state, and local
agencies. Without greater usage by small business and
government agencies, no infrastructure modernization strategy
will meet our Nation's needs.
As Congress continues to work on infrastructure
modernization legislature, including the Surface Transportation
Reauthorization and WRDA, we must focus on facilitating a
regulatory environment that allows for new technologies to be
deployed in the field. These reauthorizations usually are a
fairly long-term 5 year authorization. Technology is changing
so rapidly that we risk falling behind if we are too technology
prescriptive in legislating.
We have the opportunity to empower small businesses to lead
the charge on modern construction technologies, a charge that
will lower costs, increase sustainability, increase
productivity, and being more efficient, allow more projects to
be built and maintained with less money.
For example, in my home state of Minnesota, the Department
of Transportation is pioneering the use of drones to inspect
over 13,358 bridges. They have also developed robust lifecycle
cost analysis standards and practices, and are working with
industry partners to prepare Minnesota for an autonomous
vehicle future. By going high-tech, the state will maximize
every dollar of infrastructure investment.
In addition to this Committee, I serve on the House
Transportation and Infrastructure Committee. It is incumbent
upon these two Committees to take steps towards investing in a
technology-forward infrastructure plan and ensure that small
businesses are positioned to help in its execution.
Thank you to our witnesses for being here today. And Mr.
Chair, I yield back.
Chairman GOLDEN. Thank you very much.
I do not know how often the four of you have sat in front
of Committees here in Congress, so I will quickly go over some
of the rules around timing.
Each of you will get 5 minutes to testify. Members will get
5 minutes for questions as well. There is a lighting system in
front of you. The green light will be on when you begin, and
the yellow light will give you a 1-minute warning while you are
reading through your opening remarks. The red light comes on
when you are out of time, and we would ask that you try and
stay as best you can within that timeframe.
I would now like to introduce our first witness. Mr.
Andersson is an architect with a degree in engineering from
Sweden and a Master's in Architecture from Savannah College of
Art and Design with over 20 years of experience. He has applied
virtual design construction and operation methodologies on a
wide variety of building typologies. He is the director of
VDCO, at the LiRo--did I get that right? LiRo Group, and
teaches at Pratt Institute in New York, where he is leading a
collaborative BIM studio between architects, construction and
facilities managers. Welcome, Mr. Andersson.
Our next witness is Mr. Ryan Forrestel, president at Cold
Spring Construction Company based in Akron, New York. I was
about to say Ohio there. I got that wrong. Cold Spring
Construction was founded 108 years ago by Mr. Forrestel's great
grandfather and has completed numerous large and small scale
projects across New York. He is also a Co-Chair of the Fair
Apportionment of Infrastructure Committee of West New York, a
nonpartisan advocacy organization whose primary goal is to
ensure that Western and Upstate New York receives their fair
share of transportation funds distributed by the State of New
York. He has earned a Bachelor's degree in Biology and
Biomedical Sciences from Brown University and a Master's degree
in Civil Engineering from Penn State University. Thank you for
joining us today, sir.
Our third witness, Mr. Shephard, vice president of the
Construction Solutions Group at Trimble. Trimble is a company
whose mission is to transform the way the world works by
delivering products and services that connect the physical and
digital worlds. He has been a part of the executive team at
Trimble for the past 20 years and has worked in 30 years on six
continents and managed more than 3,000 employees. Before
Trimble, Mr. Shephard served Copeland and Booz Allen Hamilton
helping clients solve strategic problems all over the world. He
holds a B.A. in Business Studies with a foreign language from
the Manchester Metropolitan University and a Master's degree in
Management from Northwest University. Welcome, Mr. Shephard.
Thank you for joining us.
And I would now yield to our Full Committee Ranking Member.
No, I would not. I am sorry about that.
I do have the introduction prepared. Wonderful. I will
yield to Ranking Member, Mr. Stauber, for introducing our final
witness.
Mr. STAUBER. Thank you, Mr. Chair.
Our final witness is Phillip Ogilby. Mr. Ogilby, I was
going to refer this to Ranking Member Chabot to introduce you,
but since he is not here you will have to take this
Minnesotan's word for it.
Mr. Ogilby is the chief executive officer and co-founder of
STACK Construction Technologies. Founded and headquartered in
Cincinnati, Ohio, STACK Construction Technologies is a leading
cloud-based preconstruction collaboration platform. After a
decade owning a construction company, Mr. Ogilby entered the
construction tech industry with his son, Justin, who was only
14 years old at the time. Using Justin's coding skills, and
Phil's entrepreneurial spirit, the father-son team have created
multiple construction technologies and startups since 1995.
With a 262 percent 3-year growth rate--I want to repeat that.
With a 262 percent 3-year growth rate, STACK is one of the
Nation's fastest-growing private companies. Thank you for
coming here to represent high-tech family business and the
innovative spirit of Cincinnati.
Chairman GOLDEN. Thank you very much, all of you, for
joining us. We will go ahead and do our opening statements.
And we would start with Mr. Andersson, you are recognized
for 5 minutes.
STATEMENTS OF LENNART ANDERSSON, RA, DIRECTOR OF VIRTUAL
DESIGN, CONSTRUCTION AND OPERATIONS (VDCO), LIRO GROUP,
PROFESSOR, PRATT INSTITUTE; RYAN FORRESTEL, PRESIDENT, COLD
SPRING CONSTRUCTION; CHRIS SHEPHARD, VICE PRESIDENT,
CONSTRUCTION SOLUTIONS GROUP, TRIMBLE, INC.; PHILLIP OGILBY,
CEO AND CO-FOUNDER, STACK CONSTRUCTION TECHNOLOGIES
STATEMENT OF LENNART ANDERSSON
Mr. ANDERSSON. Thank you very much, Chairman Golden,
Ranking Member Stauber, and members of the Subcommittee. And
thank you very much for inviting me here.
As said, my name is Lennart Andersson. I lived in New York
City now for 20 years. I originally come from Sweden, and I
have been working in the infrastructure sector in New York City
for these 20 years. And I am appearing here today on behalf of
the American Society of Civil Engineers. I am representing the
150,000 members.
ASCE is the Nation's oldest national engineering society.
And the construction industry I am representing as well. And it
has provided leadership and vision and problem-solving skills
for construction design professionals for the past 20 years.
I appreciate the opportunity to be here today to discuss
this smart construction and increasing opportunities for small
businesses. ASE is eager to work with Congress to find ways to
improve project delivery at all stages, including planning,
funding, design, construction, operations, maintenance, and
decommissioning on projects.
All phases of construction are poised to change and evolve
in the coming years, incorporating traditional tools of the
trade and new technologies that could transform the way
projects are completed. The industry has a lot to gain from
these new innovative technologies so that we can build better
buildings and infrastructure and communities.
Today's construction design can be slow to adapt to change
and incorporate technology because of the complexity and long
duration of projects.
In 2017, the McKenzie Global Institute released a report
that stated that efficiency of architecture, engineering, and
construction, often called AEC, the efficiency dropped 26
percent since 1991 to 2017, while the average non-AEC business
in the United States increased its efficiency by 48 percent.
That is actually a 100 percent difference.
So the tools and processes used in the infrastructure
construction are still largely analog and manual. And if
properly implemented, the very latest technology will enable
the construction industry to achieve higher quality results.
And on projects in New York City, we have been testing the
very latest, actually, we are sort of seeing that you are
achieving much better results.
The virtual design and construction not only creates
assimilation of the project but as a part of the construction
process it helps to create budgets and schedules as projects go
through funding approval and access a single repository for all
project scope and design documentation. It simplifies owner-
engineer collaboration through interactive processes and
manages in duration of the projects' budget, schedule, and
design. And it creates detail estimates and schedules by
managing documents, changes, and forecasts, and drives field
productivity from anywhere with mobile solutions.
Virtual design and construction also enables access to a
single searchable repository for as-designed or as-built
information to facilitate construction, maintenance, and
operation activities.
Just one example of East Side Access, a new station
underneath Grand Central Terminal in the United States in New
York City where I have been involved for the last 7 years, and
it is the largest infrastructure project in the United States.
And we had four people modeling the whole project. It is 6
miles, 125 complex models. It was documented the traditional
way, so over 100,000 drawings. And so we were able to actually
create a model that everybody can see the complexity. By
applying automated reality capture and digitization of
documentation, processes, and common-sense standards, it is
possible to realize the digital twin of infrastructure before
construction. This model is used for planning and augmenting
the design for all stakeholders through interactive interfaces.
The digital copy is also used for traffic simulations, virtual
mockups, staging, planning, construction phasing, site safety
analysis, as well as community outreach, which also help
accelerate decision-making and optimize execution.
BIM increases transparency and fosters an environment of
participation for all stakeholders. This method of virtual
design sets the stage for more collaborative forms of project
delivery methods. BIM also coincides with lean construction and
public-private partnership projects, where timely coordination
and accurate information is paramount.
So we have an opportunity to use small businesses as change
makers of infrastructure. Innovation is often more difficult to
implement in larger organizations, while small businesses are
inherently forced to innovate in order to be competitive.
So ASCE looks forward to working with the House Committee
on Small Business and Congress to find ways to improve
America's built environment so that every family, community,
and business can thrive. So thank you very much.
Chairman GOLDEN. Thank you, sir. And we look forward to
getting a little more out of your testimony through the Q&A
phase of things.
Mr. ANDERSSON. Sure.
Chairman GOLDEN. So thank you.
Mr. Forrestel, we now recognize you. Thank you.
STATEMENT OF RYAN FORRESTEL
Mr. FORRESTEL. Thank you.
Good morning, Chairman Golden and Ranking Member Stauber.
My name is Ryan Forrestel, and I am the president of Cold
Spring Construction. We are a 4th generation family business
based in Akron, New York, outside of Buffalo. We have been
performing civil and heavy highway construction projects in the
western half of New York State and Northwestern Pennsylvania
since Cold Spring was founded in 1911 by my great grandfather.
We employ about 120 people in our peak season, and as a
family business, we are not just a family in terms of the long-
term establishment and operation of the business, but we are a
family business in terms of the families that we employ. We
have multiple members of many families working for our
business, and we treat our people like family. We care about
them like family. We would not have the success that we have
without them. So things like today are very important to us to
continue that success and to do everything that we can to take
care of those people in our families.
We have done projects ranging in size from a few hundred
thousand dollars to $130 million, large projects relative to
the size of our company. That is one of the things that we
focus on in terms of developing our people to be able to do
that and leveraging technology and other resources so that we
are able to compete at those kinds of levels.
One of the things that we have invested in in the last 15
to 20 years is technology related to digital models and
automated machine guidance. These technologies have allowed
Cold Spring to handle projects that would have been difficult
or impossible without the utilization of these technologies. In
addition, we have been able to complete these projects more
accurately and on tighter schedules than if we had not been
using these technologies. And this has been something that we
have seen over the last 10 years with greater frequency that we
have been able to hit schedules or exceed schedules pretty
dramatically. And this is largely contributed to by the use of
technology.
I have heard arguments from other contractors of the years
that implantation of digital technologies as was alluded to
earlier, is too expensive and it is just for large
corporations. It is too expensive for smaller businesses not to
invest in these technologies. When we are seeing increases in
efficiency of 20 percent or many times that in some instances
businesses that do not make these investments will not survive.
And I think as we are going to talk here today, it is important
that these technologies are not only allowed but encouraged,
and so everybody needs to get on board and this needs to be
pushed forward.
I will talk a little bit about the advantages that these
technologies offer. The first most obvious is efficiency.
Everybody wants to be more efficient. These technologies are
pushed forward as offering that efficiency, which they do. But
some of the more subtle aspects of the benefits are the access
to information that these technologies provide. One of the big
problems in the field when things are done the old-fashioned
way with pieces of paper is changes are made and people in the
field do not know what those changes are. Using digital
technology and life-time information, when changes are made,
everybody knows what they are and they are implemented right
away. Nobody starts out doing the wrong thing and then has to
go back and do rework, which is one of the most expensive
things in construction.
And in that same vein, we can avoid problems. If we are
building a digital model that incorporates all aspects of the
project and all of the things around it, we can see conflicts
and the way that new construction interfaces with existing
infrastructure before we build it. Whereas, oftentimes in the
past we begin construction and then we encounter a problem
partway through, which again requires rework, it is expensive,
it is time-consuming, and it is certainly not the most
efficient way to do work.
And another big factor is safety. We have numerous people.
Historically, we have had numerous people on the ground around
heavy equipment checking grades, laying out construction, and
for example, in pipe trenches as well. A guy is down in a hole
checking grade, putting pipe in. Now, we have the opportunity
to do all those things from in the cabs of machines. It takes
those people out of harm's way. Takes those people out of
trenches, which eliminates one of the most dangerous aspects of
construction being trench collapses. And another thing it
allows which contributes to efficiency as well is where it was
impossible to do work during dark hours, during nighttime hours
without huge amounts of lighting, now we can take those people
who are on foot out of the construction site. Only the machines
are operating. It makes it much safer and gives the ability to
be much more efficient.
So to briefly wrap up, I want to say that Cold Spring works
cooperatively with owners and agencies to implement these
technologies but a lot more can be done to help move this along
and bring forward some of the small businesses that have not
engaged in this. Project design from inception to completion
should be done in a way that complements the use of digital
data. Specifications should be written and revised to allow
technologies to foster their adoption their adoption and use.
These actions are only a benefit to agencies and taxpayers as
they allow projects to be completed more accurately, more
timely, and more cost effectively. Thank you.
Chairman GOLDEN. Thank you very much.
Next, we will hear from Mr. Shephard.
STATEMENT OF CHRIS SHEPHARD
Mr. SHEPHARD. Thank you. And good morning, Chairman Golden
and Ranking Member Stauber.
My name is Chris Shephard, and I am the vice president at
Trimble. I have been with the company for 21 years, and as you
can probably tell from my accent, I am based in Dayton, Ohio.
Trimble is a global technology company--I am an American
citizen, do not worry--focused on transforming the way work is
done through the use of intelligent integrated technologies and
innovative solutions.
Trimble innovation enables economic breakthroughs while
enhancing safety, increasing productivity, and reducing
environmental impact. Our software, hardware, and services are
transforming industries, such as agriculture, construction, and
transportation and logistics.
As my colleagues have already mentioned, the construction
industry is ripe for innovation. We are talking about a $10
trillion global industry. And McKenzie was referenced earlier a
couple times, their estimate is that about 10 to 15 percent of
that $10 trillion is waste. That is a lot of money.
The industry has historically used size and scale to do its
work. Bigger machines, more machines, more people, more nails,
more cement, more tools. This reliance on scale creates a major
disadvantage for small businesses who do not have the capital
or volume of work to be able to absorb these inefficiencies.
Today, ineffective planning communication and collaboration
cause the most problems and drive up project costs. The use of
digital construction technologies provide small businesses with
the information they need to better manage their costs,
schedules, and resources, and levels the playing field so that
they compete with their larger rivals.
A few examples of digital construction technologies would
include application software and modeling that allows
contractors to remotely monitor site progress from their office
and create design models that can be sent to the machine
operators and crews in real-time. Machine control and guidance
systems that provide machine operators real-time positioning
for guidance and control of their machines, allowing them to
accurately grade, compact, and pave to specification. And site
positioning systems allow contractors to measure, check,
manage, and inspect all the phases of their efforts and paving
operations.
When these technologies are used on infrastructure projects
the results are significant and measurable. Machine
productivity increases by 30 percent. Rework can be reduced by
up to 50 percent. And overall project delivery costs are
improved by up to 30 percent.
And technology does not just increase the bottom line. It
also improves environmental sustainability by reducing the use
of fuel and the loss of resources to waste.
Small businesses are the lifeblood of the construction
industry. And technology is allowing them to compete against
the larger players in the industry. I would like to highlight
just a couple of examples of small businesses that are
achieving success using Trimble technology.
First of all, Mr. Chairman, your home state of Maine, the
Shaw Brothers of Gorham, Maine, are using GPS machine control
systems to improve the efficiency and equality of their work
which has generated savings in project times and overall costs.
And on larger jobs, the state DOT will sometimes use Shaw
Brothers' 3D files to inspect and keep a record of the work
that has been done, making the DOT's work more efficient, too.
The second example, Ajax Paving in Detroit, Michigan. Ajax
Paving was able to keep a machine moving through dense fog
while paving a highway project in Northern Michigan, preventing
a shutdown that would have wasted 200 feet of concrete that had
already been dumped in front of the paver.
Our 50 state DOTs have a high level of awareness of the
benefits of digital construction. However, investments in these
capabilities compete for scarce resources with much needed
infrastructure projects in each state which has in many cases
limited the pace and scope of adoption of the systems and
capabilities which would support enhanced management and
oversight of the projects themselves.
Resources provided by the Federal Government would
accelerate the advancement of these project delivery efficiency
tools. Trimble supports a provision in the Senate
Infrastructure Bill which creates incentives for states to
upgrade the technical skills of the engineers and technicians
who we all count on to enable digital construction delivery.
This will result in safer roads, better lifecycle costs, and
less disruptions to commerce in communities across America.
Small businesses will also benefit from states adopting the
use of 3D models through the construction lifecycle as it
allows them to fully realize the benefits from their
investments in digital construction technologies.
So in conclusion, I would say the construction industry is
often criticized for its inefficiency and waste, but today we
have the technology to ensure the projects are delivered on
time and on budget. Increasing the adoption of digital
construction technologies not only leads to better quality
infrastructure delivered at a lower cost and with less
environmental impact, but it also levels the playing field for
small contractors to compete with the larger players in their
industries and to grow their businesses. Thank you.
Chairman GOLDEN. Thank you very much, sir.
And in closing, we will give the last 5 minutes to Mr.
Ogilby.
STATEMENT OF PHILLIP OGILBY
Mr. OGILBY. Hi, everybody. Thanks.
First of all, thanks for the opportunity. I very much
appreciate it. I appreciate the kind words at the opening as
well. I have got a fair amount to say, so I tend to talk fairly
quickly and it is going to take that to get through this in 5
minutes.
My background is in construction. I was a contractor in the
very early days. I have started now two significant technology
businesses, STACK being the most recent, and we have thousands
of customers worldwide.
Our customers are small businesses. So fundamentally, I
love the direction of the whole hearing today. This is about
our customers. That is who we are talking about here. So, I
have got some words about why pay attention to me. Much of that
has already been covered.
You know, the construction industry represents 6 percent of
the global GDP worldwide. Construction is the single largest
consumer of raw materials worldwide as well.
You know, one of the big challenges as I was doing research
for this, it was very interesting to find people are moving
into urban areas at a very, very rapid pace, and it is creating
a huge demand for infrastructure worldwide. Not only in the
U.S., but worldwide. In fact, the U.N. estimates that by 2050,
there could be as many as 7 billion people living in urban
areas. That would be up from 3.5 billion people today.
Autodesk, the world's leader in design software, in fact,
estimates that that could create a demand for as many as 1,000
new buildings a day over the next coming decades just to meet
the demand for infrastructure worldwide. This continuing trend
requires a massive amount of new construction and renovations
to be done.
U.S. construction spending in 2017 topped $1.27 trillion.
It is expected to reach $1.5 trillion by 2023. The bigger
problem here is the industry cannot keep up, candidly. The
industry, the current pace of construction productivity cannot
begin to keep up. There have been studies already referenced,
productivity gains across the industries outside of
construction have exceeded 10 or 15 times or more. The actual
productivity level of construction has dropped over the last 80
years. A big part of that is the complexity of the projects,
but the failure to adopt technology is also a drain on the
system.
We also have an enormous labor shortage. So while we cannot
affect that personally with technology, I could not go through
this process without at least addressing the labor shortage.
But there is a high failure rate of construction startups as
well that is also a problem within our industry. Again, we
focus on the small businesses, candidly, and I was shocked at
this statistic. If you start a new construction company in the
U.S. today, 25 percent of you will be out of business next
year, within 12 months. Seventy-four percent of all new
businesses started in construction today will be out of
business within 5 years.
One big simple drain on this or cause, if you will, is poor
adoption of new technology. There is a tremendous amount of
very powerful technology available today, but candidly, the
construction industry adopts technology at a very slow pace. If
you look at studies that have been done across all industries,
construction is at the very bottom in terms of the adoption
rate of new technology.
Digitization, adopting new technology is the answer that we
can bring to the table today. There has been a study, the World
Economic Forum did a study that predicts an increase in savings
and cost savings as much as 20 percent by full digitization of
our industry as an impact. Globally, this could unlock as much
as $1.2 trillion in costs.
I have a couple of asks for the Committee today. One is
obviously to find creative ways to help the industry adopt new
technology at a much faster pace.
Consider mandating the use of technology on government-
funded projects and not just at the general contractor level
but push that all the way down to the subcontractor level.
And then my last ask is interesting. It is consider
directly impacting adoption for contractors by extending grants
to construction technology providers such as ourselves that we
can use to subsidize the cost for the smallest companies who
need to make that move into technology. Thanks again very much.
Chairman GOLDEN. Thank you all very much for the testimony
that you have shared with us today.
I am going to very quickly go a little bit out of order
just because I want to point out that my wonderful wife Isobel
is visiting. She is sitting over here. She snuck in once we got
started. So she is here to make sure I am on my best behavior
during the Q&A.
So I thought one of the first things I would ask, just to
go ahead and go right at one of the more potential political
questions that you might expect someone to ask when talking
about going digital, talking about automation and other things,
always there is a real fear out there about the replacement of
middle class, good blue collar construction jobs and others. I
think, Mr. Andersson, you kind of directly said it in a
positive light where you said the very latest technology will
enable fewer people to do more and achieve a higher quality
outcome. Of course, there are some people who might fear that
this could pick winners and losers out there in the
construction industry. And I just wanted to give, I thought Mr.
Andersson, and maybe Mr. Forrestel an opportunity to talk about
this because, obviously, like you said, you are a family
business. You want to take care of your entire family. And I
know you all want to keep people working. So just your thoughts
in general about those who might have concerns about job loss.
Mr. ANDERSSON. If you look at the needs of infrastructure
in this country, I think we need to become much more efficient
because I think if you look at New York City, I think there is
a huge issue because there are cost overruns traditionally. It
makes it hard to make new initiatives. We need new tunnels. We
need so much in New York City. But I think because of all these
cost overruns there have been issues that actually hurt
industry. And I think the efficiency, we can do much more to a
high quality.
Mr. FORRESTEL. Well, I think to reference what Mr. Ogilby
said, there is a huge shortage of tradespeople for the
construction industry in this country. I mean, it is widely
acknowledged by the Associated General Contractors of America
that construction employment is a real problem in terms of
companies finding good workers. And I think the one point that
Mr. Andersson made about the technology reducing the number of
people because of the increase in efficiency which we need to
see in the industry for many reasons is a big deal, but I think
it is also an opportunity to attract more members of the
younger generations into the industry. They do not want to dig
ditches with shovels. They want to be involved in something
interesting and engaging. And this technology, a lot of these
technologies offer that opportunity for the younger generations
who are used to engaging in those technologies, or technologies
similar to what we are using in the construction industry. So I
think it provides real opportunity not to exclude people who
might want jobs that actually include----
Chairman GOLDEN. And do you think your workforce or
potential future workforce is getting the kind of training
opportunities and exposure to the kind of competency in digital
technologies or, you know, new equipment, more modern, forward-
leaning equipment?
Mr. FORRESTEL. No, I do not think the adequate training is
out there. I think there is some movement to head in that
direction, but we are not seeing it yet. It hit our people in
the field, so a lot of our training for that is once we hire
people, but it is an opportunity. And I think it is an
opportunity to take an industry that has been considered dusty
and dirty and dangerous over the generations to be something
that is really an opportunity. It is an opportunity for people
to make a fantastic living doing really interesting work and
really meaningful work. I mean, I know our people take enormous
pride in traveling around Western New York, telling their kids
about the projects they worked on.
Chairman GOLDEN. Oh, yeah, these are great jobs. I think a
lot of people back home in Maine also take pride in being a
part of the construction industry.
One of the things I love most about your testimony, sir,
was talking about the distribution of information in the field
and preventing rework. The Marine in me, they put a big
emphasis on, you know, if you do not get information out into
the field, how can people make frontline decisions and not make
mistakes. So it makes a lot of sense to me in terms of the
digital stuff.
Mr. Shephard, I want to give you in the closing time I have
here, an opportunity to field a question.
As people were talking about the expenses of new equipment,
automation, digital technology and others, I was thinking about
the BETE tax exemption programs for equipment that I became
familiar with back home in Maine, if you know what I am talking
about, the Better Equipment Tax Exemption Program which I
imagine would cost something like an automated bulldozer. But
would it also include things like digital technology upgrades
that would improve the efficiency and planning phase? Could a
company write off those types of investments as well under that
program?
Mr. SHEPHARD. I am not sure, Mr. Chairman, but if it does
not, it ought to.
Chairman GOLDEN. Mr. Andersson?
Mr. ANDERSSON. It actually does. Yes, we bought this
$250,000 laser scanning equipment and it is a write-off. And it
has made a huge difference for us, so.
Mr. SHEPHARD. Do I have a second just to comment?
Chairman GOLDEN. Yes.
Mr. SHEPHARD. I think what is important to Bill and what
Lennart said in his opening remarks as well, we need to go from
the beginning to the end of the process; right? We make systems
that can be used all the way throughout the process, but if you
do not start with a digital beginning, a design, and then pull
it all the way through, that is where you get the real
advantage all the way through the construction process.
Chairman GOLDEN. Thank you very much. I am out of time, so
I am going to go ahead and yield to Ranking Member Stauber.
Mr. STAUBER. Thank you, Mr. Chair.
Your testimony, all of your testimonies were fascinating to
me. You talk about digital technologies, where it is at.
In my hometown, in Hermantown, Minnesota, small town, we
put up a health and wellness center, and it had to be bonded.
And to make people understand what it was going to be like, you
put the goggles on and you literally walked through the health
and wellness center and it was amazing. And so you talk about
the technologies you are putting forward. I think this is
absolutely where it is at.
There are a couple of questions, Mr. Shephard, for you
first. I am aware that the Minnesota Department of
Transportation and Trimble have worked together on intelligent
compaction and a tool called Eroutes. Could you expand on what
these projects look like and what came out as a result of the
collaboration with MnDOT?
Mr. SHEPHARD. Yes. Sorry about that. I have to press the
button.
Actually, I am glad you brought that up because the
Minnesota DOT now mandates the use of intelligent compaction on
its projects. And what that does is it guarantees the quality
of the finished product by knowing that you are compacting to
the right specification every time that you do the compaction.
So that is a use of technology on the compaction material, on
the compaction equipment, the compactors that can make the
right number of passes at the right, provide the right, I keep
saying the word ``compaction.'' Sorry. It is all about
compaction. It gets the compaction correct without having to do
any more rework or guessing or missing spots in the place. So
it really gets the quality you have done the first time
accurately and you can be assured that it is okay.
Mr. STAUBER. Which maximizes the investment.
Mr. SHEPHARD. Well, it improves dramatically the quality of
the finished project, the road or the pad or whatever it is.
You get it built right to the design and there is no guesswork.
Mr. STAUBER. I just want to put a plug in for the Minnesota
Department of Transportation. I was the Chair of Public Works
and Transportation for a county and I am extremely proud of
that relationship the counties and MnDOT have built to maximize
that investment using these new technologies. Very critical.
Another question I have, in March--this is for Mr. Ogilby.
In March, I introduced H.R. 1890, the Preserving America's
Infrastructure Dollars, the PAID Act, which would require
states to conduct a lifecycle cost analysis on infrastructure
projects that use more than $30 million in Federal funds. How
do digital technologies reduce lifecycle costs for larger
infrastructure projects?
Mr. OGILBY. Push the button. That is a great question.
From the infrastructure standpoint--I am not confident that
I can answer correctly.
Mr. STAUBER. Anybody? Can anybody answer that? Go ahead,
Mr. Andersson. And then, Mr. Ogilby, you can finish your
sentence.
Mr. OGILBY. Sure, thanks.
Mr. ANDERSSON. So we work with B&T, Bridges and Tunnels in
New York City. A lot of existing facilities. The vast majority
is nine facilities. And there we actually are scanning and
modeling all the existing facilities and then the asset
management piece is a huge, sort of unknown as far as I think
their budget is $2 billion the next 3 years just to maintain
these facilities. We have found multiple steps of
inefficiencies. They cannot find the records to maintain this.
People move much more in the workplace than they used to so you
do not have the guy that worked there for 30 years that know
where these things is. So we are digitizing everything so you
can actually quickly find a piece of equipment. And you are
talking millions in savings every year. Just alone, just to
find things and now what to do so you can fix something
quickly.
Mr. STAUBER. Thank you.
Mr. Ogilby, finish. Thank you.
Mr. OGILBY. Actually, I wanted to touch on something Mr.
Golden brought up earlier which was around the workforce. And
so just some stats that I had dug up.
There were 300,000--according to the U.S. Bureau of Labor
Statistics, 300,000 vacancies in the construction industry in
June of this year, expected to climb to 757,000 by 2026. So,
yeah, there is more labor needed dramatically, and I would not
place that as a concern----
Mr. STAUBER. Okay. Thank you.
Mr. OGILBY.--regarding technology adoption at all.
Mr. STAUBER. Interesting.
Mr. Forrestel, with your company, it sounds like very well
respected, 4th generation. Can you tell us, give us an
approximate amount that your company invests per year in
digital technology to stay competitive? Just a rough estimate.
Mr. FORRESTEL. It has varied some. We were fortunate to be
an early adopter when we had a lot of work that the technology
was applicable to. But I would say on average the technology
across the board, we are investing 5 percent----
Mr. STAUBER. Okay.
Mr. OGILBY.--of sales in technology.
Mr. SHEPHARD. That is 2-1/2 times the industry average.
Mr. STAUBER. That is 2-1/2 times the industry average.
Okay.
Mr. OGILBY. But at the same time, we are seeing enormous
returns on that. Very fast return on investment. And then
everything above and beyond that ROI is profit or being able to
bid projects at a lower price and procure more work and do it
more cost effectively for the owners.
Mr. STAUBER. I think you mentioned in your testimony that
small businesses cannot afford not to invest in this technology
to stay competitive. And Mr. Ogilby, you talked about, I could
not believe this stat, but one out of four construction
startups will be out of business in one year.
Mr. OGILBY. Yeah, that is correct. And it is really
stunning. And we see it. I mean, these are our customers, and
so we see it, unfortunately. But that is the case today.
Mr. STAUBER. Right.
Mr. OGILBY. One thing I would just like to add on, too, I
think it was Mr. Golden asked about the current tax breaks that
are in place. I think most of that we find is around hardware
and equipment. So just from the pure technology standpoint, I
do not think there is much out there available today.
Mr. STAUBER. Okay. Thank you very much.
Chairman GOLDEN. We would now recognize Mr. Hagedorn, from
Minnesota's 1st Congressional District.
Mr. HAGEDORN. Mr. Chairman, I am happy to defer to our
Ranking Member Chabot.
Mr. CHABOT. Go ahead, please.
Mr. HAGEDORN. Are you sure?
Mr. CHABOT. Yes.
Mr. HAGEDORN. Okay.
Thank you for the opportunity. I appreciate it.
I take it that this technology, this digital technology
helps you be more precise. Would that make some sense? And your
planning, reduce costs, things like that, certainly, it could
be an advantage if you are bidding on contracts, you are
probably going to be viewed as the team that is going to maybe
have the best deal or at least be the closest to the end.
So Mr. Forrestel, what is your experience? How much can you
save in these areas? How important is it to be efficient by
using this type of technology?
Mr. FORRESTEL. It depends somewhat on the type of project.
Some projects it is easier to leverage the technology for cost
savings than others. We were fortunate----
Mr. HAGEDORN. Give us an example of a difference. Different
type of projects.
Mr. FORRESTEL. So big earthwork projects are sort of the
natural fit for the automated machine guidance type work where
you are moving huge quantities of dirt. You can move it more
quickly because everybody who is working on the site in a
machine knows when they are getting close to what the finished
product needs to be. They are not getting somewhere in the
ballpark and then the survey crew has to come out and check
grades again. They are grading to the finished grade and they
are done. So that is where some of the biggest efficiencies
lie.
I gave an example in my written testimony of roadway
grading where the efficiency has improved in the neighborhood
of 500 percent with automated machine guidance. And so on long
expressway-type projects that are new construction or full
reconstruction, the savings are astronomical. And initially, we
were fortunate because not knowing what those savings were
going to be, we realized a lot of those as profits which
allowed us to cover our costs of implementing the technology
early. Now, we are competing against more contractors who are
sharing in the same advantages, so now those savings are being
passed on to the agencies and ultimately the taxpayers.
Mr. HAGEDORN. That is good.
Is it considered now the industry standard that you have to
do this or are states requiring it to make bids?
Mr. FORRESTEL. There are not requirements. There have been
more changes in the specifications to allow it. Initially, we
saw resistance from a lot of the agencies because it was just
unchartered territory. They did not have the same reference
points to look at that they used to, oftentimes being stakes in
the ground. That was all information on a computer screen, so
they had trouble adjusting to that. But we are getting there in
terms of allowing it. I think now it needs to be encouraged or
required.
Mr. HAGEDORN. Now you have kind of proven the technology a
little bit and they see the benefits.
So Mr. Ogilby, you talk about workforce issues, and I
happen to be somebody that agrees with you 100 percent. For a
long time in this country we almost discouraged people from
getting into a vocational trade certificate program, skilled
labor. Told them if you did not go to a 4-year college you are
just not going to amount to anything. That turned out to be not
such a good thing. And now we are trying to get folks to the
point where they have a choice. And whatever they choose to do,
whatever is in their heart, they should be fostered, enabled to
do that.
A piece of legislation that I have introduced with
Congressman Van Drew of New Jersey, it is bipartisan, it is
called the American Workforce Empowerment Act, and it would
make it so these 529 education savings accounts could be
applied to certificate programs, apprenticeships, skilled labor
type fields, the purchase of tools and equipment. Is that the
type of legislation that you might be able to help us with?
Mr. OGILBY. Oh, that is fabulous. I love that. Yeah, that
is fabulous. Yeah, 100 percent. You know, there has been a
stigma around it and we have alluded to it. My friend from the
AGC I am sure would confirm. I mean, it is probably, aside
from, you know, the adoption technology, we have an enormous
lever with technology where we can really drive efficiency, and
this Committee is doing the right thing. But on the labor side
it is the single number one biggest problem and challenge for
the construction industry as a whole today without question.
Mr. HAGEDORN. Does anyone else have a comment on the
skilled workforce issue? You pretty much agree?
Mr. SHEPHARD. Yeah, definitely. We are testing in New York
actually the apprenticeship model, sort of reverse mentoring.
It is sort of a generational thing. The kids growing up, they
just run with this technology. But the people that are really
experienced are not so familiar with it. So teaming a young
person up with an experienced, and we have seen some really
interesting results on that.
Mr. HAGEDORN. Thank you. That is H.R. 4469. So thank you
very much. I appreciate it.
Mr. OGILBY. Yeah, thank you for that.
One thing I will add is that technology can be a carrot
here as well, right, for adopting, for getting new people to
want to move into the industry. The more we adopt technology as
an industry, I think the more attractive it becomes to young
people. And a couple other fellows made that comment as well.
Mr. HAGEDORN. Thanks very much. I yield back.
Chairman GOLDEN. Thank you very much.
We will now call upon the Full Committee Ranking Member,
Congressman Chabot, from Ohio's 1st Congressional District.
Mr. CHABOT. Thank you very much, Mr. Chairman.
And Mr. Ogilby, I will go to you if I can. Welcome, again.
I understand my colleague from Minnesota introduced you. I
hoped to be over here but unfortunately, around this place,
things always come up and change plans.
Mr. OGILBY. No worries. No worries. Thank you very much.
Mr. CHABOT. The best laid plan. But it is great to have you
here, as well as it is the other witnesses.
Your company, STACK, has experienced some really incredible
growth in a relatively short period of time. Could you talk
about the types of financing that you have secured to
facilitate that growth? I know you talked about going to 20
different cities and being told no by various venture
capitalists.
Mr. OGILBY. You have done some research.
Mr. CHABOT. Yeah. So if you want to talk about that,
perhaps, and also, what availability did you find in our
community in Cincinnati that you found helpful in growing your
business?
Mr. OGILBY. Yeah, sure. Well, first of all, my story goes
back probably, well, 2 decades now. So when I started iSqFt,
which was my last startup, now employs more than 1,000 people.
It is known as Construct Connect, still based there in
Cincinnati. A lot of those war stories around raising money and
traveling around the country, I finally found an angel investor
in Cincinnati to help us fund that business and get it off the
ground.
Mr. CHABOT. What would you say America's greatest city is
again?
Mr. OGILBY. That would be Cincinnati.
Mr. CHABOT. Thank you. I appreciate that. Go ahead.
Mr. OGILBY. Thank you, Mr. Chabot.
And by the way, the State of Ohio was very helpful with
additional financing to get our young, very young business off
the ground 2 years ago or 3 years ago.
Mr. CHABOT. Greatest city and the greatest state. I am just
saying. But go ahead.
Mr. SHEPHARD. If I could jump on the bandwagon, my daughter
goes to the University of Cincinnati. So I would just like to
jump on.
Mr. CHABOT. Oh, excellent. Our daughter is a graduate of
the DAP program there and my wife is a graduate there as well,
so great school in a great city. No, go ahead.
Mr. OGILBY. Thank you for the opportunity. I could expand
but----
Mr. CHABOT. So anyway, on the financing and----
Mr. OGILBY. Yes.
Mr. CHABOT.--Cincinnati, and how you went through this
process.
Mr. OGILBY. Sure, sure, sure.
So, well, very early on, again, I literally traveled the
country. There was some resistance. Everybody I met with it
seemed like told me this was the greatest idea. They could not
believe nobody was doing it already. I was in San Francisco
many times. You know, New York, Chicago, many, many times. And
at the end of the day, I was able to secure angel financing in
Cincinnati, and we had a very friendly angel who helped us to
continue that business even when we were still hearing no
locally. We did finally secure financing from a local
Cincinnati venture firm in River Cities Capital and Chrysalis
Ventures out of Louisville. That was my last startup.
Today, we have funding out of the City of New York, the
great state of New York with Level Equity, but you know, it is
all money very, very well invested. And driving technology into
this industry is not for the faint of heart but it has been a
very rewarding experience as well. I love hearing the stories
about the impact of technology. We literally have hundreds and
hundreds of testimonials from customers who tell us how it has
impacted their business and their family lives and the impact
of their family of their employees. And it is just very, very
gratifying. So this is near and dear to my heart what you folks
are putting together here, the concept.
Mr. CHABOT. Thank you. And it is my understanding that
STACK provides colleges and universities with free access to
its pre-construction tools. How do these partnerships help with
industry workforce development, and what impact has that had on
your business?
Mr. OGILBY. You know, it is something we have debated
through the years. Being a relatively small business still
today we do not always feel like we have the resources we need
to do that but it has been a tremendous program. So we do that.
As you have explained, we offer free technology, our solutions
free for universities, and it has been a powerful thing for the
ones who have adopted it. And obviously, the goal being we want
to seed the market with experienced operators of the technology
as they go into the workplace.
Mr. CHABOT. Very good. And then finally, how do platforms
like STACK integrate with other tools that are offered by other
companies? How do businesses learn how to fully utilize these
tools?
Mr. OGILBY. Yeah, that is a great question. Training is a
whole another issues, and training is getting easier and easier
with the modern tools and the modern design. Training today is
not nearly what it was 25 years ago with desktop software
solutions. So training is less and less of a challenge for us
every day.
But one of the things that we do focus on is integrating
with other platforms. We are not everything to everybody, and
we do not intend to be. And I think most solutions are the
same. So we see a tremendous amount of value in integrating. So
we have an API behind our platform but it is really a set of
hooks that other software can use to pull and push data in and
out of our platform. I know Trimble has the same sort of
things. And it is becoming more and more common in the industry
to do that, but I think ultimately success and widespread
adoption across the industry of technology is really going to
require that kind of interconnectivity between apps.
Mr. CHABOT. Thank you very much.
Mr. Chairman, my time has expired. Thank you.
Mr. OGILBY. Thank you.
Chairman GOLDEN. Thank you very much.
We will now move on to Congressman Balderson, also of Ohio,
and Ranking Member of the Subcommittee on Innovation and
Workforce Development.
Mr. BALDERSON. Thank you, Mr. Chairman. And thank you,
panel, for being here today. I have never talked this much
about Ohio in a long time. I am glad to hear that we all agree.
And this question is broad for the whole panel, so anybody
can go in any particular order you would like to go. But I want
to thank you again all for being here today.
I sit on this Committee, and also the T&I Committee, like
our Ranking Member, Representative Stauber also sit on the T&I
Committee. So I know how critical it is to fix our Nation's
crumbling infrastructure.
In your written testimonies, each of you highlighted the
rate of adoption, or rather the lack of thereof of new
technologies by small construction businesses, as well as the
state departments of transportation. Would each of you share
some of the reasons this is the case? And have there been any
cases we can look at in which states or small businesses have
done a good job of adopting innovative technologies?
And as I said, you all make this--whoever is ready to go,
go right ahead.
Mr. ANDERSSON. One of the issues we are finding is rate of
adoption, I have been at this for 20 years now, is that a lot
of the standards and requirements are outdated. So when you get
a project from an agency, you are supposed to use CAD 2D
drawings and submit the piece of paper. So the effect that you
have to maintain a legacy system and innovate on the new side
becomes very expensive. So it will be much easier if agencies
start mandating these new technologies and then you can
actually make the decision without maintaining the old system.
Mr. SHEPHARD. If I can just add, you know, representing a
manufacturer that develops these tools, the software, the
hardware, et cetera, back at Woodland it says we do not want
people to mandate our specific products. I do not want the
world to be mandated to be Trimble products. That would be nice
but that is not what is needed. We are happy to work with
everybody to increase the adoption broadly and then all boats
rise on the tide. And we will take our chances individually as
which consumer prefers the right solution. And we work
collaboratively with people that we compete with in the
marketplace every day to try and find innovative ways to
increase adoptions so that we can gain all these efficiencies
that we have all testified to today. So we are happy to do
that. It is really about seeding the mindset to ease the
adoption.
Mr. BALDERSON. Would anybody else like to add? If not----
Mr. FORRESTEL. Sure.
Mr. BALDERSON.--my follow up--oh, go ahead. I am sorry.
Mr. FORRESTEL. I can add a little bit from the construction
industry side in terms of resistance to adoption. I think it
has been alluded to some today but our industry is old school.
You know, guys who start construction companies like to buy
their iron, their equipment, and technology does not
necessarily fit the same mold. So I remember when we were
getting into it, my father was questioning the expense of
investing in the technology. He said, well, that stuff does not
move dirt or put pavement on the ground. Well, no, it does not,
but it helps you do it a lot faster and a lot more accurately
and a lot more efficiently. So it is getting over the hump for
some people of understanding exactly what it does and how much
it does benefit. And that it is not exactly getting the work
done but it is helping you get the work done so much more
efficiently. And that is just what I have seen in the industry
and through personal experience in terms of being an impediment
to adoption is just that that perception that it is not the
nuts and bolts stuff that we have always done.
Mr. BALDERSON. Okay. Thank you for your answer, all of you.
My follow up in the brief time I have here left, to the
best of your knowledge, are there Federal regulations
preventing these types of systems or technologies from being
adopted?
Mr. FORRESTEL. I can name one off the top of my head.
Mr. BALDERSON. One is one, so.
Mr. FORRESTEL. For FAA work, paving on airports where the
owner of the project is the FAA, they mandate paving with
string lines. That is their specification. And there has been
some success by us and others to convince them in certain
instances to be able to use machine automation which in paving,
whether it is blacktop or concrete, is way more efficient. And
especially in the tight timeframes that are often required for
airport work, that is a big deal. And it is just an antiquated
specification that does not allow for new technology.
Mr. BALDERSON. Thank you very much, panel.
Mr. Chairman.
Chairman GOLDEN. Thank you all very much.
I am going to go ahead and do another round. I do not know
if there are other members who might be interested.
One thing, talking about the workforce training
opportunities, and it sounds like you are doing a little bit of
this, Mr. Ogilby. In Maine, when I was in the Maine
legislature, we went ahead and put a little bit of state money
into a training program working in the logging industry where
we do see a lot of technological advancement in the equipment,
but it is very expensive to have. Hard for a community college
or a training program, apprenticeship program to purchase half
a million dollar pieces of equipment or more. So really, we are
having a hard time getting youth opportunities to get in and
get trained with that equipment which then made it harder to
hire them because you are dealing with a pretty expensive piece
of machinery that requires extra training. So the industry
actually was willing to kick in some of that equipment so we
did not have to purchase it and now we had like a nice public-
private partnership where our young loggers were able to get in
and get enough hours working new equipment so that they were
entering into the workforce not just trained on one piece of
equipment which was kind of the industry standard, but on
multiple pieces of equipment. Now they had a more dynamic, more
flexible workforce, and more likely to be hired more quickly
into the jobsite and be more valuable. And if a piece of
equipment went down, they could just hop on another one.
So I do not know if you all have seen anything like that
but even with the digitization side of things, helping to pool
resources for training opportunities I think is a big part of
getting a trained and ready workforce.
I did want to ask if any of you have anything to say about
potentials around 3D printing in the construction industry. The
University of Maine Advanced Structures and Composite Center, I
just have to brag about, they now have the largest 3D printer
in the world, and they are working with all kinds of neat
stuff. You know, hybrid manufacturing, 3D printing, using long
fiber reinforced tapes. They are doing thermoplastics, bio
resins and other things. You can think about cross-laminated
timber for the construction industry. They are making
lightweight tougher than steel axels for equipment and other
things. It seems to me like the sky is the limit but I am
curious what you are seeing with 3D printing in the
construction industry.
Any of you. Go ahead.
Mr. SHEPHARD. Just a quick comment on that. We are a
partner in a venture fund which is led by the Hope family who
own the Caterpillar dealership in Texas. It is a broad fund
that is focused on construction technology. And they closed 3
or 4 months ago. We had the first meeting a couple of weeks
ago, and one of the businesses they are looking at is a
business that actually 3D foot homes. Like 1,200 square foot
homes. It is remarkable. And they are focused on affordable
housing where you can go into plots of land in underprivileged
areas and these are really affordable, properly built, durable
homes and it is a startup out of Texas that is doing that.
This is an explosion in this area. It is really where, you
know, one of my soap boxes is this is the fusion of what you
call just normal manufacturing principles and technology
brought to the construction space. This is how people have been
building cars, cutting metal chips all across the Midwest for
years. So now we are applying these principles, and 3D printing
is no more than taking a CAD file and putting it on a lathe or
a machine, a C&C machine that cuts metal to print a house the
same way.
Just one quick comment on your education, Mr. Chairman. And
it ties two things together about the job loss or the fear of
job loss. We actually work very closely with the unions. We
have a collaboration, a partnership with the International
Union of Operating Engineers where we use their facilities, we
donate equipment, we bring customers to train. The union loves
it because they can upscale their people. We love their
facilities and we can use the space and their equipment to show
our customers and showcase. And it has been a very symbiotic
relationship where they get something out of it. We get
something out of it, too. And it helps the workforce.
Chairman GOLDEN. That is great. Thank you very much. The 3D
printing aspect, you know, I find very interesting. They just
did, like I said, the largest 3D printer in the world for now.
I think we are going to continue to see advancement. But I
think they did a 30 or 40 foot boat in under 72 hours. If you
stop and think about that, that is pretty amazing. They started
it up on Friday and came back in to a finished--it does float,
yes. I actually got into it.
Mr. STAUBER. Mr. Chair, I will let you know, my staffer
asked the question. I did not.
Chairman GOLDEN. Yeah, that is right. So, you know, more to
come on that. And thanks for sharing the training partnership
with operating engineers.
Go ahead, Mr. Stauber. Thank you, Mr. Chair.
If Ranking Member Chabot were here I would ask him to have
a conversation about which state is better because I will take
Minnesota any day.
I have got just a couple of comments.
First of all, thanks for your expertise in sharing this
with us. I think that by using digitized technologies we can
save money. That is the investment from the taxpayers. The
projects, the lifecycle can be longer because of, for instance,
the compaction is perfect.
And then one of the things that we talk about is the
safety. And Mr. Forrestel, you talked about working at night.
The safety of the men and women that are putting the projects
together, it is critically important that we invest in these.
And I am excited.
Mr. Forrestel, you had mentioned the FAA mandates paving
with string lines. I am on the Aviation Subcommittee, and I
turned to the Chair to my staffer here. And I said, this is
something that we can implement in the RFPs.
My hometown airport of Duluth, Minnesota, just did a
complete paving of the runway 927. And if that saves the
taxpayer money and does it quicker because it is also our F-16
base. And so these are some things that you as experts can
bring to us that we can help change and do things better, more
efficient, maximize the taxpayers' investment. So I really
appreciate your comments and considerations today. Thank you
for your time. I hope you felt it was valuable because I know
we did.
And to the Chair, thanks for putting this together. These
are the type of really nonpartisan or bipartisan things that
we, in Congress, can do to help small businesses succeed. So
thank you, Chair Golden.
Chairman GOLDEN. Of course, always a pleasure to work with
you.
I would say as well, Mr. Andersson, you were talking about
having to have two different platforms, you know, drawings and
sketches, and then also having the 3D option. And it makes me
think of the need to invest in an advanced workforce within
government as well, whether that be DOT or other agencies and
departments at the Federal and state level. If we are not
investing in a workforce that is able to keep up with the
private sector, then it will inevitably hold us back. And we
all know the large role that government plans in regard to the
procurement of services, many of which you provide in
construction, particularly with roads and bridges and others.
So we have got to be looking to that as well. And I am
interested in the FAA piece as well, Mr. Stauber.
So I want to thank you all for joining us today. Please
feel free to send us more info if you have it, or if you think
you want to add in more or you did not get some of the
questions that you really wanted to answer, let us know, and we
are happy to have that information.
I think it has been a worthy hearing where we have learned
a little bit about how digital construction tools can help our
small businesses find opportunities to cut costs and compete
for more business. Nimble small businesses need a level playing
field to contribute cost-saving services as we begin to spend
Federal dollars to improve our Nation's infrastructure. But
small businesses cannot unlock these opportunities if they fail
to adopt cost-saving equipment, which is why the members of
this Committee are looking to raise awareness of the value of
digital tools and encourage small businesses to actively adopt
them in construction, design, and engineering.
I look forward to working on this issue with the Ranking
Member and members of the Subcommittee and Committee. Some of
you had some ideas on how we could incentivize some of these
things and we will be looking back at your testimony and
advice. So thank you for joining us today.
And I would go ahead and ask unanimous consent that members
have 5 legislative days to submit statements and supporting
materials for the record.
Without objection, so ordered.
And if there is no further business to come before the
Committee, we are adjourned. Thank you very much, gentlemen.
[Whereupon, at 11:17 a.m., the subcommittee was adjourned.]
A P P E N D I X
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