Drying to a Standard

Drying to a Standard  

by D. Tim Cordle, MBA and Mickey Lee, WLS

Article originally published in the April 2007 edition of Cleaning & Restoration Magazine, with  updates and revisions.

"We're pulling off the job today. The building is dry".

Okay, but what exactly does that mean? What does it mean to be dry? Dry seems awfully relative. So is there a way to define what a dry building is after restorative drying has been performed?

The foundation of any discussion centered on restorative drying must have at its core the definition of "dry", or more importantly, exactly what is means to "dry to a standard". Drying to a standard involves many specifics, but the end result is a building that is dry based on established, predetermined principles and criteria. These fundamental criteria don't change from job to job or building to building. The principles and rules don't bend just because a client of adjuster wants a building dry in "X" number of days.

Think of "drying to a standard" being applied to the different sizes and types of buildings in the same way as you might think of the laws of gravity and the various sizes and types of airplanes. While there may be many different shapes, sizes and types of planes, each uses the same laws of physics and gravity to fly.

A drying standard is uniform and it uses the normal equilibrium conditions in a building as its benchmark. The benchmark during new construction will almost always be higher than the benchmark recorded in an existing building. Based on the information gathered on site, targeted moisture levels of the affected areas are determined based on established principles and criteria. Some like to say the building itself will tell you when it's dry.

The same criteria we use to determine if a building is dry in Florida is the same criteria used for a building in California. Dry is based on principles, not "gut feel" or subjective interpretation. Dry is not the same number for every building "dry" falls into a narrow range of numbers. It cannot be driven by the polarizing pressure of an insurance claim or economic factors stemming from the need of the drying contractor to make a profit.

So, now that we understand what it means to dry a building based on pre-established principles, we may ask, "Why is the drying standard important?"

First, since the standard and its criteria don't change, it helps ensure that every customer gets the same end product every time. The standard then is critical to quality (CTQ). Each stakeholder gets a building that is dry based on fact, not fiction. The principles that go behind the standard assure quality by practice. The standards, when followed, ensure that a building affected by water intrusion isn't lost because of insufficient drying driven by objectives other than the drying process itself.

Second, drying to a standard is important because it mitigates water damage, avoiding the pitfalls of the progressive stages of water damage that may occur if aggressive processes are not used. Proper response and drying that are driven by the standard may prevent primary damage from water migration problems from becoming anything more.

But, the progression may occur quickly, moving from water migration (e.g., stage one), to structural damage (e.g., stage two), to humidity damage (e.g., stage three), to microbial damage (e.g., stage four), to indoor air quality damage (e.g., stage five) if the process and standard aren't followed. A blind obsession with cost minimization in lieu of sufficient scope and applicable standards is certainly one way to escalate both damage and overall costs. Don't fall victim to placing emphasis on short-term costs over long-term effects. The cost and effect chain may not be that short term. The escalation of what could be a controllable water migration to an indoor air quality problem can be the direct result of an emphasis in the wrong place.

Once a building crosses the threshold of humidity damage into microbial damage, it is much harder and more expensive to recover the building. The costs escalate quickly when the failed drying attempt must now include considerations such as business interruption, inventory loss, or the inability to fulfill contracts or sales orders. Failure to follow an aggressive drying protocol coupled with a drying standard can easily turn a $200,000 drying job into a $1,000,000 mitigation, remediation and reconstruction.

So, what are the overarching princples on which a good standard of drying is based? There are three general princples which should define and describe when drying services are sufficient in any building:

1. Ambient conditions can be held at or near pre-loss conditions by the  building's  HVAC system. An ambient that is not controlled properly could create conditions suitable for active mold growth to reoccur.

2.  The moisture on and in the building materials will not be conducive for the active growth of mold and mildew.

3. The building materials and contents will complete their return to equilibrium moisture content (EMC) with normal ambient conditions by themselves without further damage to them. In other words, the drying effort does not have to continue until absolutely every square inch of the affected materials are to their EMC as long as they will complete their return within a reasonable time under the normal conditions that will exist after pull-off. 

How does one then apply these principles? That involves moisture equiplibrium points, accelerated drying techniques, and effective uses of equipment and instruments to achieve pre-established target moisture levels. For example, in drywall, the standard may involve defining three additional criteria:

1. The moisture content of all affected drywall is decreasing.

2. All affected drywall is within a certain range of its target moisture level.

3. A high percent (i.e., 90 percent) of the affected drywall area meets criteria 1 & 2.

Logic dictates that other peripheral questions, although seemingly simple, are answered to the satisfaction of the drying contractor:

1. Has the source of moisture intrusion been located, repaired or corrected?

2. Is the corrective measure permanent or temporary?

3. Based on answers to those questions, what is the likelihood of further or continued water damage?

First and foremost, the drying standard is for the customer. The standard quarantees a level of consistent, reproducible, repeatable quality that is designed to avoid potential escalating damage and future litigation stemming from failed drying attempts that may affect the building as well as the health of those who occupy it. And although it seems that drying to a standard would be a logical choice to make, there are contractors as well as insurers who use economics and profitability as their standard. Additionally, there are contractors and insurers who imply that the same cost structure for drying a single family residence due to awater heater leak is the same as a six-inch sprinkler line break on the top floor of a twenty story building. That is ludicrous.

However, if the same drying standard is used in drying both, then the two have something in common. Drying to a standard uses "Quality of the Product" as its only driver of success. Drying to a standard remains the most cost-effective, value-based method for restorative drying in our customer driven market. Anything less is speculative and a quality compromising approach to drying.

My Window to the World Leaks

In my work I constantly see property damage either from "event" related damage or from poor original construction in the form of "construction defects".......now "latent defects". Either of these two categories will normally have water intrusion damages. The latent defect condition, created during construction, is the premise behind this article. The article's intent is to inform and educate the reader in basic categorical sources of water intrusion and specifically related to windows.

The building envelope is complex. In order to prevent and control water, moisture, and water vapor intrusion into the building, the building envelope system, and it has many components, must work as intended. The failure of the envelope, a single component in the envelope or combination of system failures can have devestating affects on the building and its inhabitants. The visual I like to use in illustrating this simple concept is the image of putting one screw all the way through the hull of a submarine. Maybe that's not a problem. If you have several and the bildge pump fails.........what happens next?

When discussing the topic of water intrusion from latent defects, I always break down the discussion into three basic components; the window itself, the installation of that window and the preparation of the window opening. 

No matter how many projects we see, in the wettest parts of the country, it seems clients, owners, insureds and even engineers make the same overly simplistic and incorrect generalized statement..."the windows leak". But.......do they?

That statement is too broad......too simplistic. When heard, one initially thinks there is actually a problem with the window. Just because there is water damage around the window doesn't necessarily mean that the window itself leaks. One can never know why water is entering the building envelope at the window opening unless one starts field testing and performing destructive analysis.

What we eventually find is that conditions generalized as "window leaks" could be from one or a combination of conditions. Each of these "conditions" is a defective component from either a manufacturing process or a human process. Each of these "defective" parts of the system, the manufacturing process or the human process can each have many layers of defects, commonly known as defect densities. For example, there are many reasons (defects) that may make a window from manufacturer "defective". There could be a frame defect, a sealant defect, an assembly defect....well... you get the idea. The same is true in the field when it comes to the installation of the window and the opening preparation. There are dozens of possible defects for each and so there are almost endless possibilities for combinations or causal relationships.   

I've started breaking down the window water intrusion analysis into three basic sources; the window, the installation of the window and the prepatation of the window opening. Water intrusion could be from one or a combination of any or all three of these potential failures.

To understand the concept clearly, it takes a good window installed correctly into a properly prepard opening to mimimize the potential for water to follow the natural path of least resistance and enter the building envelope.

When I explain this concept to attorneys, I try to just refer to the conditions as good or bad so they can relay that to a jury when the time arrives. Very simply, one could have a good window (defect free) incorrectly installed into a properly prepared opening. Now.....does the window itself leak? No....not really. In a court room that could be the difference between a product liability claim or a contractor claim. But, one can just as easily have a defective window perfectly installed into a properly installed opening. That's why field testing the product during installation is so critical.....but very few contractors ever take advantage of the ASTM provided guidance.

This problem, this analysis, boils down to simple math. Using fundamental combination theory, there are eight (8) possible generalized macro combinations of reasons why water is able to enter around the window and or window opening.

Since there are three defined categories of defects (window, installation and opening preparation), each with a simple good/bad condition, we wind up with a combination possibility result of 2X2X2=8.

In chart form, those combination possibilities look like this:

 

 The absolute worst of the possible combinations is a defective window installed incorrectly in a poorly prepared opening.

This DCD (defect combination density) can and will have catostrophic affects on wood framed structures. in the realitvely short time period of two years, wood framing can be rotted, even reaching the point of complete loss of structural integrity. The loss of structural integrity not only affects loading but wind shear as well. And I'm not stretching the truth when I tell you that I've poked my finger through the structural members of a building just two years old.

The water intrusion can also draw subterranean termites which will eat the structural framing. The water instrusion has created a conducive condition to termite infestation and the termite bond has been compromised. The abundance of water in locations over time can lead to brown cubical rot as well as the ability for wood decaying fungi to start eating the wood as well. For a visualization.............should OSB be see through?

There is one other direct result of water intrusion from the possible combination of just the window conditions alone and that is compromised indoor air quality. Water intrusion is the first Stage in this process with the compromised indoor air quality being Stage V......but that's another article.

In short.............you may not have a window problem at all. You may have an installation problem. Then again........you may have both. I will always ask you to prove it.

Guilty as Sin

I know a man who has a nicely framed plaque on his wall that has an expression that took years to deeply understand, is by no means original , and is representational of the situation that most small to midsize general contractors find themselves in today in Florida. The plaque reads: “When you’re up to your ass in alligators…it’s hard to remember that your original objective was to drain the swamp”.

Workers’ Compensation Insurance is hard to get in Florida, especially in the restoration segment of the industry. The Builders’ Insurance Group (the insurance arm of the National Home Builders Association) dropped an overwhelming majority of customers. Even those with no claim history lost their insurance because it wanted out of the market. That meant that thousands of contractors and subcontractors lost their G/L and WC insurance.

The G/L coverage isn’t that difficult to replace but the WC is almost impossible to replace in the market with the only real choices being to simply fire everyone who works for you and re-engage them as independents, make a move toward employee leasing, or pay the astronomical amounts that the state operated program offers (which makes the company uncompetitive if they price all those premiums in their competitive bids). I know……ARISTON Construction, Inc. was forced to make this decision in 2011.

And this is where we get to the alligator part. We knowingly, willingly did it to ourselves…..for years. General Contractors, both big and small, have avoided, ignored,  and otherwise discounted job safety for so long…..the alligator finally became visible in the water.

Even today, on a project where the hard costs will easily surpass 20 million dollars, the daily repetition of OSHA violations of even the most basic PPE requirements is both hard to count and hard to believe. The lack of use of hard hats, safety glasses, boots, and other simple PPE necessities like masks are the most obvious, but there are others. Some are more life threatening than others.

Even when we talk about the basics in PPE, we aren’t talking about hard to understand concepts. We are talking about items that should be second nature to anyone in the business. I don’t know anyone personally that leaves his house in the morning without their pants on so why would you jump on the scaffolding without a hard hat? Why would you operate a circular saw or a chop saw without safety glasses? If you’re cutting cementious siding, why would ever start without a mask?

Then there are more conditions we find continually that seem to fall into the category of: “what in the hell were you thinking”? Using a power cord at the end of an extension cord to run multiple power tools, walking a roof line without a harness or lanyard, changing scaffolding assemblies when you aren’t certified to do so are all additions to a long list.

During demolition I’ve seen repetitive conditions left by the same electrician as panel face plates are left off live electrical panels for hours at a time. I’ve seen demolition debris piled three feet high covering the entire stairwell or breezeway egress locations without any forethought to the trip hazard it creates with other people using the ingress/egress location. I see scaffolding too far away from a building and without proper railing twenty feet off the ground. I see improper use of walk boards, stepping from the building to the scaffolding and the use of scaffolding before it’s been tagged.

Recently I say a man dig a hole large enough for five or six people to stand in in order to undermine a footing and without wall shoring and without fencing.

Following any set of rules and regulations is hard enough but is realistic when the culture is embedded from the top down. If you are a PM, a superintendent or supervisor, your actions and attitudes towards safety must set the tone. The workers won’t do any more than you.

The observations above were made of companies that have an annual revenue curve that averages better than $50 million and the lack of adherence to OSHA guidelines or their own safety manuals is one reason why the smaller companies today can’t maintain affordable WC insurance. I guess the other is that the smaller contractor never even attempted to work safely.

So, as the insurance alligator gets closer remember………..we drained the swamp.

WOOD You Please Stop That

My father built houses with my grandfather. Maybe that's where I get my fascination with all facets of construction. That exercise between father and son was over 50 years ago. When we look back though, the housing industry hasn't really changed all that much. Power tools, computers and communication platforms have changed the industry but the basic materials we build with haven't changed other than moderate evolutions, with a few exceptions. One of the newer products, although more than 2 decades old now, is what you might know as building wrap, or WRB (weather resistant barriers). The WRB is crucial to the water resistant ability of the building envelope and is also considered part of a proper water management system.

What is the building envelope? The building envelope is best defined as the exterior shell of your house. The roof systems, the exterior walls, the windows and doors all make up the envelope and each of those systems must be integrated to prevent water intrusion, in all its forms, from penetrating the shell.

Why is the envelope important? Innovations such as OSB and I-joists have been welcomed with open arms but both have served to move away from more historically preferred members such as 3-ply structural plywood that OSB replaces and pine or hybrid woods which the I-joists are replacing.  Both the OSB and the I-joist are engineered replacement solutions that are cheaper for the home owner. Both of these products can be affected more quickly when the outer layers of the building envelope begin to fail.

Other engineered products, such as the introduction of cementious siding products that will last longer than their wood predecessors, have helped the most outward layer of the building envelope last longer. Improvements in paint products, sealants and  windows have also aided in making the houses we live in today better, more energy-efficient and less expensive to maintain...if the building envelope has been assembled correctly and in the right sequence.

Today, more than ever, general contractors are more subcontractor brokers than builders, which causes continuing doubts over the building envelope in which you live. With lesser skilled tradesmen, smaller margins, and the need to complete the project, no matter how large or small, the correctness of the building can become less important.  Oversight is crucial. Educated and informed oversight that is not entrenched in 30 year old methods and means is even more important.

My work has proven to me that most envelopes today aren't built properly. This in part because the building envelope isn't assembled correctly or is missing some of the parts or elements that would ensure that it performs as intended. The water-proofing and water management portions of the envelope can be the most vital pieces of the puzzle. It is their failure that causes the most damage. If that damage occurs in conditions other than "named storms", your insurance company is most likely not going to pay for the damages. The failure of the building envelope is most often a construction related defect or "latent defects" and most home owner's policies exclude damage related to construction defects.

The building envelope has become more important today than it ever has been before due to one simple reason. If the building envelope fails, the engineered products being used in today's homes will begin to deteriorate faster than the more traditional materials. 

That gets me to the most important point: in these days of frequent and alarmingly destructive natural disasters coupled with the growing inability of home builders to execute the assembly of the building envelope correctly...I have to ask why we are still building houses out of wood, which is much more susceptible to the outer elements than steel?

Just before the implosion of the economy, California and Florida were the most prolific states building houses out of steel , with the highest percentage of total volume being about 8%. Contrary to popular belief, a house constructed of steel does not cost more to construct than one of wood with some governing variables.

Steel, in all it's forms, is more durable and more resistant to deterioration from water and of course can't be compromised by wood decaying fungi and/or wood eating vermin and insects. If you are about to build; do yourself, the environment, and your insurance carrier a favor - consider steel in both heavy and light framing.

ARISTON, LLC is a proud member of the Building Envelope Science Institute.

BENCHWARMERS

Why sitting out the hurricane season on the bench could be good for your company.

 My wife says that we are deeply disturbed people watching the television so intently, reading E-mail alerts from NOAA sent to our Blackberries, pulling Hurricane forecasting off every statistical web site we can find, just waiting for the “manna from heaven”……..waiting for the wind to blow and blow hard.

 All national companies plan in detail for the blessed events staging trucks, trailers and people just over the line inGeorgia, holding their breath for land fall of a Category 1, 2 or 3 Hurricane. Anything stronger than that, there isn’t much to dry or restore. Re-construction becomes the answer. The more aggressive companies bring their whole entourage into the fray putting assets and people in harm’s way. Everyone wants there shot at the wet revenue. It’s interesting to watch when the first storm approachesFloridaas dozens of “storm troopers” line up convoys of trucks, some rented and some owned, full of every piece of drying equipment they can get their hands on. The longer it has been since the last “event”, the longer the line of vultures waiting to feed on the carcasses of injured buildings.

 The real question is why? Hurricane work really isn’t that profitable to start with. Unless your company has a contractual obligation to serve, or has offices in the city of state, perhaps being a benchwarmer could be the best decision. Why? Even the largest of companies get handed their hat  seemingly year after year, sometimes for millions of dollars. And unless your company has money trees on its balance sheet, you may not be able to wait a year or more for your money.

 The business opportunities abound, but so do to the profitability challenges, business risks, carrying costs, opportunity costs and the business model “after shocks.” With business down across the board this year, many of you won’t resist the temptation. The desire to try and make up two years of revenue short falls with this year’s hurricane events will cloud your business judgement. And remember what Gordon said;”never get emotional about stock. It clouds your judgement”. So, let this serve as a re-fresher.

 I’ve already mentioned low profitability but to be more precise, companies can expect to see profit margins less than half of the norm in their business model. It’s not unusual for the national players to spend close to a hundred thousand dollars or more to move equipment, trailers, generators, supplies and people to an area devastated by a hurricane, even a small one. And that’s before the company even has its first signed contract for work.

 That “sunk cost” is hard to re-capture. The players that have been here before know that the indirect job costs have to be allocated to the jobs you take, but that hardly ever covers the actual costs. Customers as well as adjusters think you are gouging them for an extra 5% when all your company is really trying to do is break even on the indirect expenses. Sorry though, most just won’t pay the line item.

 Secondly, credit decisions , or poor risk decisions, can effect cash flow in your company for years to come when your decision, or worse that of a salesman, is made in haste. Most companies don’t pull credit reports on their potential customer, don’t execute contracts correctly if at all, don’t pursue lien rights correctly, leaving themselves open for one of three out comes; either not getting paid at all, getting paid in a year or more, or if you are lucky, being able to negotiate and get out as quickly as possible. Anything other than close to full contract price really isn’t worth the financial risk.

 Risk management decisions are clearly one of the largest stumbling blocks to successful hurricane opportunities. Companies considering taking on the prospective work must look past the revenue.

 There are three primary concerns; profitability, risk management in the form carrying costs and opportunity costs, and the after affects to your company. Managing each of these during the normal course of doing business is easy, relatively speaking. But the chaos that is a hurricane event is exponentially more complex than normal business. One would think that with so many contracts falling into the cost plus category that making money is guaranteed. But it’s not.

 Capturing data for invoicing seems to be the single largest business problem for any player, no matter what level. If you can’t invoice for what you actually perform, you of course still have the costs associated with performing the work and your company may lose money on the effort .

If your company has trouble capturing data, you are going to have problems with the receivable. And your company’s probability of collecting that receivable becomes smaller every week that rolls by after your company has returned home. Like any other business, the disaster recovery business is all about cash flow with profit being second. If your cash flow from operations is decreasing as a result of working hurricane activities, you should really consider whether the decision to participate is driven by emotion (all my competitors are there so I have to be), or whether your decision has been weighed by a good business decision model. If you don’t know what cash flow from operations is, you really don’t need to put your company at risk in a business environment that is so very risky.

 Working the opportunities in a hurricane event without substantial cash reserves can be financial suicide. Carrying the profit portion of the receivable is one thing but carrying the obligations to vendors and subcontractors is another. Trade terms of 30-60 days aren’t going to be enough compared to the length of time it will take to collect your receivable. So you need a plan before entering into every opportunity that firmly defines how your company will meet the financial obligations attached to the potential uncollected revenue other than “the hope” that your customer pays.

 If your customer doesn’t pay, can your company get a loan? The largest issue for your banker will be probability of collection. Once collectibility is established, your company may be pledging assets to fund your cash flow. Diminished profit coupled with carrying costs suggests that what was half of your normal profit may be down to a third or worse.  

 Your company should have a financial target and job profile that you really want based on the assets you are bringing before you even approach hurricane opportunities. I’ve seen companies accept jobs trying to cover the “sunk costs” of getting to the event only to tie up human and capital assets which prevents them from taking the next job. Quite often, the next job was the right one. Taking a job to have a job only means that there is opportunity costs associated with your decision. You don’t want to be obligated to a marginally profitable job with questionable collectibility when a good job comes along.  

Part of the consideration in choosing that job isn’t just the financial target or the job profile, but the customer alone. There is no mistaking that some categories of customers put your company more “at risk” than others. Sadly, the sales force doesn’t usually ask the right questions. And when they don’t, that’s the ball game. There are condos, air port hotels, malls, strip centers, high rise offices, office condos, leased space and the questions that go with them such as “who has the right to cure?”. How much is the hurricane deductible, the co-insurance, what are the structure limits, the content limits, what is the demo cap, is there mold coverage?Are you applying for FEMA money? You know the drill. But companies always forget.

 It will be weeks, not days, before someone sees a certified copy of the insurance policy. And that “mold remediation” you just performed isn’t covered. And yes, it does matter. “My contract is with the insured” is a naïve and arrogant statement that will come back to you when that receivable turns south.

 The last risk item that we should discuss is the personnel issue. I don’t know a company that doesn’t use recruited labor during hurricane season, even for project management. And every year, there is the temptation after returning home, to maintain the same level of human and capital assets as during the disaster recovery. This is still another dimension of the cash flow problem. Resist the temptation.

 Hurricanes are a statistical probability but how your company reacts to these random events should be anything but. Don’t get caught reacting to sudden changes or events as if those changes are permanent. Shed the excesses as quickly as possible to protect cash flow.

 As a project manager, I have worked for two of the largest players in the market place. As a consultant, I’m still cleaning up job files from both Katrina and Wilma, now three years on. Many of those unsettled insurance claims have unpaid drying and restoration invoices attached to them and the majority will likely be in court, or at the very least, in appraisal. If readers could see those files, you would see the names of your competitors and in some cases, maybe even your own name. And every one of these competitors thought it wouldn’t happen to them.

The majority of the time the reasons are the same. Greed, poor decisions, and poor execution get even the largest players in trouble each and every year.

By the time this article is published, “Hurricane Season” will have actually started and each of you will have already started thinking about the money your company might make. I would suggest to you that maybe; just maybe, some companies should sit this one out. Being a benchwarmer might just be the best financial decision you’ll ever make.

Tis the season”. See ya’ll at theFlorida line.