While submitting claims for losses can raise insurance premiums, not taking security measures in the beginning might prevent a contractor even from being able to get insurance. According to Warren McGrath, an insurance broker for Willis Construction Services in Hartford, CT, “There is an expectation that a contractor will perform in a prudent fashion, and a prevention of loss is considered prudent. In fact, it’s a policy condition: You must do everything you can to prevent loss.” Often, though, between the high cost of insurance premiums and the high deductibles-usually starting around $2,500-many contractors decide that self-insuring is more economical, all the more reason to take preventative measures to ensure against loss. Bill Jackson, director of safety and environmental affairs for Granite Construction in Watsonville, CA, says, “For the most part, we self-insure against those losses. It is my impression today that the value of the insurance premium exceeds the value of the losses. I can’t pay 1,000 dollars of insurance premium if I’m only going to lose 900 dollars’ worth of value. To my knowledge, we have not decided to buy that kind of coverage because we do a good-enough job.” Losses to the industry from construction crimes add up to big dollars. Vicki Schlechter, executive director of the Construction Industry Crime Prevention Program (CPP) in northern California, estimates that about $3 million per county per year are lost in northern California alone. This isn’t just the cost of the equipment, but the loss of income from downtime as well. In a similar program in southern California, Schlechter’s counterpart, Diana Rummel, illustrates the loss by saying they have aided in the recovery of over $24 million worth of equipment since 1985. While these statistics are just for California, the problem is national, even worldwide.Simple management measures can be taken to deter would-be thieves and vandals. If you think about it, a few extra minutes at the end of the day is a whole lot better than days of downtime thanks to stolen or damaged equipment. This is the belief at the CPP, a nonprofit, educational corporation supported by industry grants and annual membership dues. According to Schlechter, the CPP’s sole purpose is to prevent and solve construction-site theft and vandalism. With similar programs in northern, southern, and central California and the Pacific Northwest, the CPP comprises contractor members that range from sole operators to some of the largest names in the business. Both Schlechter and Rummel say that they are unaware of any similar groups in other states, but that they are often getting calls from industry groups or task forces in other areas of the country asking for advice. One of the CPP’s main benefits is its 24-hour hotline and rewards program. Available not only to members, the hotline is a clearinghouse for tips about stolen equipment and construction-related crimes. If a call leads to an arrest, restitution, or recovery of stolen equipment, the programs offer a reward. The caller’s identification can remain anonymous, which makes it easier for those on the inside to relay knowledge of crimes without fear of retribution.So what is a contractor to do? The answers are often common sense. Schlechter advises disabling the equipment at night. This can be as simple as removing a battery or spark plug wires so that the equipment cannot be started. But a large portion of equipment theft occurs during the day, especially with rental equipment, she points out. She tells of cases where a couple of guys wearing hardhats have simply loaded equipment onto trailers and driven off a job site, and no one stopped them because it was assumed that they were picking up rental equipment. To prevent this sort of occurrence, Schlechter recommends good job-site control. “Who’s supposed to be here? Everyone must sign in at the job office. I recommend distinctive hardhats, logos, and shirts. The more awareness there is, the better your chance of prevention.” At Granite Construction, Jackson states, “It is our policy to make sure that visitors to our job sites are always escorted by someone on the job.” Other commonsense practices that the CPP recommends include die stamping or engraving the driver’s license of the equipment owner on every piece of equipment, in several places if possible. Also, painting equipment with distinctive colors and painting your logo or identifying marks on the roof or rollover-protection devices will help law-enforcement agencies spot your equipment as it rolls down the highway on a thief’s trailer. This goes for tools, ladders, cords, and other small equipment. The CPP suggests spray-painting these and die-stamping identification on them where possible. Once all of this is done, it is equally important to keep an accurate inventory of the equipment, identification numbers used, and where on the equipment the numbers are located. Because of the number of other crimes, “Law enforcement basically has a 15-minute window of opportunity on a property crime,” Rummel points out. “Everything else is more important than property crimes.” Therefore, the more accurate the information about a piece of equipment that can be supplied to law-enforcement agencies, the better the chance of recovery. To prove the point, Rummel adds, “Less than 15 percent of our members have had any kind of a loss in the past four years. Of the marked property losses, we have already recovered 80 percent.”Granite Construction does a lot of road work and work in remote areas. “Generally, in those kinds of construction environments,” says Jackson, “we have some central lay-down yard. And in those situations we would put the really portable construction equipment-small trailers, compressors, generators, hand tools, and building materials that might be associated with the construction-in a temporary yard that is fenced and has a locked gate. The stuff that’s truly at risk of leaving us overnight, we put in a storage trailer inside the fenced facility.” Granite is a member of the CPP and follows their advice when it comes to identifying equipment. “We haven’t gotten sophisticated enough to use tracking systems,” Jackson remarks. “For quite some time we have been using a system of putting identification numbers on the major frame components of our equipment. So if it is missing and we report it, we can tell the law enforcement agency not only what the numbers are, but where to look for them.” When it comes to the larger pieces of equipment that cannot easily be stored in a locked yard, Jackson says, “One of the most effective things that we can do is park the equipment so that the largest pieces of equipment-those that are the least mobile-are at the ends of the line and snuggly pushed up against the more mobile equipment in the middle. It makes it much more difficult for thieves to come pick up a backhoe when it’s trapped between two larger pieces of equipment and can’t move forward or backward. When you think about it, it works pretty well. The other thing we do is, when we park the equipment, try to drop all the ground-engaging tools and engage them into the ground. So if it has a blade, a bucket, or ripper teeth, we put it on the ground, making it difficult to move the equipment.” Jackson says these extra measures are necessary. “I’ve heard it alleged that in most cases when a piece of construction equipment is stolen, it’s stolen because the thief already has a customer for that specific make and model. So they’re out looking for it, and they bring the tools necessary to get that piece of equipment. So if they’ve found a market for a backhoe or a motor grader, that’s what they’re out shopping for with their trailer.” He says the problem with just relying on the standard ignition locks is that “it’s like the lock on your front door: It keeps the honest folks out.”Job-site security is not only about theft, though. Vandalism and injuries are also security concerns. “Crime impacts liability,” says Schlechter. “Contractors don’t always look at it from that aspect. Say two kids trespass, which is a crime, and they get on the backhoe, start it up, and are going to take it. It’s a crime, but that won’t matter if they are injured, because that is what will make the six o’clock news.” Vandalism is also a huge problem. In the month of November 1999 alone the northern California CPP reported about $245,000 worth of damage in just two incidents. Schlechter says vandalism ranges from graffiti and putting stuff in fuel tanks to moving survey markers and using equipment to rip up a job site. “Those major incidents don’t happen all the time, but it’s a lot more serious than people realize,” she states. “It’s common for us to get a report every day of a vandalism that’s at least 1,000 dollars’ worth of damage.” In addition to the normal crime reports, Schlechter says, “Every time we have a natural disaster, our equipment thefts go up really high. The issue is that there’s a huge need for repair and people won’t wait, and Uncle Billy Bob says, ‘Well, I can give you a really good deal and get it done in half the time.’ Of course he can, because he has no overhead; he just stole the backhoe.” Rummel adds, “There is an increase in crimes during the holidays. People who steal for a living celebrate the holidays too. They steal more so that they can give nice gifts, just like you do by working harder.”In many urban areas, theft and vandalism are common occurrences requiring more stringent measures than just a perimeter fence and a locking gate. Enter Construction Protective Services (CPS), provider of onsite guards, trailers, and electronic surveillance for the construction industry. Its safeguarding system consists of placing infrared sensors at strategic locations and hardwiring them to an onsite command post-a highly visible CPS trailer. Each system is individually tailored to the client’s need. Having a guard at the site can do more than just prevent crime. According to Betty Garrett, director of marketing for CPS, “Besides just the theft, there’s fire. We have guards that do nothing but fire watch. There are unforeseen hazards that happen-earthquakes, floods, any kind of storm that would take your trees down-other than just your day-to-day theft.” The cost of having a manned security system depends on the area, site size, and level of security necessary, but it is rarely cheap. While this isn’t typically feasible for the smaller sites and independent contractors, it often proves to be cost-effective on larger projects and in high-crime areas.In addition to implementing better site control and management practices, there are numerous devices available from original equipment manufacturers (OEMs) or as aftermarket add-ons that can help in theft prevention and stolen-equipment recovery. One such device is the keyless entry. This enables an operator to start a piece of equipment with a code punched into a keypad. Several OEMs, including Bobcat, offer this as an option on their equipment. Keytroller Inc. makes an aftermarket keyless starter equipped with an infrared detector that is automatically armed when the operator shuts off the machine and logs off for the day. The detector senses if someone climbs on the machine and sets off an alarm. According to John Burke of Keytroller, “It’s useful against vandalism and amateur thieves, but it’s not going to stop the professionals. The professional will just back up a truck to it and pull it up. It’s almost impossible to stop those guys.” Since each operator has his or her own code and the time of use is recorded, Keytroller’s unit is also beneficial for job-site control and tracking. Adds Burke, “That has a lot of applications in the construction industry because people say, ‘Oh, I know how to run that,’ and they jump on it and then some kind of accident happens.” Some of the units also come with an impact sensor so that the equipment can be set to sound an alarm if it sustains an impact greater than a set magnitude. This leads to better job-site control and less chance of improper equipment use. “It’s really a preventative thing as much as anything,” notes Burke, “because once they know that they’re gonna get caught, they’re much more careful.”Another device available both as an aftermarket add-on and from OEMs is a satellite communicator manufactured by Tracsat, a business unit of Orbcomm Global LP. The Tracsat communicator is about the size of a large brick and mounts onto the equipment in an unobtrusive place, usually under the driver’s seat. In addition, says Jeff White, business development manager for Tracsat, “When the OEMs put it on, they mount it very, very discretely and paint it exactly the same color as everything else.” The Tracsat automatically reports via satellite, at predetermined intervals, equipment parameters such as location and run hours. This information can be retrieved by the owner over the Internet using a password or via e-mail, pager, or fax. This information can be very valuable in recovering stolen equipment, but the Tracsat can also be used as a theft deterrent. “There is an application on the unit called Geofence,” explains White, “You can set a radius around the piece of equipment so that if it goes outside the given radius, it sends an alarm via pager, fax, or e-mail.” While this high-tech equipment might sound out of reach for the independent contractor, it is actually quite affordable, especially when compared to the cost of losing a piece of equipment. White says they offer “steep volume discounts, but right now if you just wanted to order one, they’re 1,200 dollars a piece.” In addition to the initial purchase, the user must subscribe to a service, similar to that with a cell phone. White says, “The most basic one will probably be about 12 dollars per month, then it goes up to 35 dollars per month for the top of the line. It’s all based on what you’re monitoring, how many reports you want to send, and other factors.”Another option available on many pieces of equipment is a locking fuel cap. This is a good deterrent to vandals who might think to put stuff in the fuel tank. Gehl Company offers a fuel cap that can be locked with your own padlock. Gehl also offers an electrical-system lockout device, which is typically located within the engine compartment. By using a special key, the entire electrical system can be disabled. As a further preventative measure the engine compartment can be locked. Richard Burckardt, marketing services manager for Gehl, explains, “It locks out the entire electrical system, so nothing will start no matter what you do to the machine. Even if you have a key to start the machine, you can’t because the lockout has been turned off.” Even with all these available devices, the best way to prevent loss is common sense and an awareness of the problem. By many statistics, the number-one piece of equipment stolen is a skid-steer. Even with the keyless starters, Brady Seavert, a field product representative for Bobcat, says that from his experience people are often the best antitheft device. “The salesmen know where the Bobcats are in their territory and who sold them, and if they see somebody riding one, they’ll stop and get the serial number and check it out because they know they didn’t sell it.”
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