E-Permitting (feat. Arash Shahi)


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SHOW NOTES


Arash is an e-permitting advocate based out of Toronto, Canada. He has created a network of businesses, builders, owners, and architects that are pushing for the ability to approve building permits through PDF documents and from the model. E-permitting would allow for automation to be increased in checking requirements and codes, and speed up the overall process from design to build. He brings some awesome insight to what we hope the future of permitting can look like in America!


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TRANSCRIPTION


Eddie: (08:23)

All right Arash. Thanks for joining us today. Why don't you tell us who you are and what you do?


Arash:

Great to be here with you guys, thanks for having me. I'm Arash Shahi, I am the CEO of the eco-innovation lab. We are a solution-driven R and D platform with the goal of digitizing the AEC industry. That's what we do. And I'm glad to be here with you today


Tyler:

So you guys are specifically in the realms of E permitting. So why don't you walk us through what E permitting is and how digitization is changing that right now?


Arash:

Yeah, I mean when it comes to digitization of the AEC industry, [I've] decided to start at the construction permits because that's where we do the stock. And also it's one of the areas that needs the most amount of work in terms of digitization. A lot of our municipalities right now are still running on paper. So we have a long ways to go in eliminating those paper processes. Also the design community, for a long time, has been investing in digital platforms and 3d models, and whatnot. But when it comes to the submission of those projects to the government, we have to print them on paper and submit them. There is a loss of data, the huge loss of data, that happens from going from a 3d model to paper. And that's what we're essentially trying to avoid. So what we did was we started with an international scan of what the permitting platforms are out there in the world.


And we categorize everything that's out there in three different categories, three different levels of E permitting four levels if you count paper. So level zero is paper-based process. Level one, there's a digital submission of 2d drawings, whether that be scaff, talky drawings, or a PDF version of the CAD file. And then level two is the BIM submission. So we have municipalities around the world that are now accepting beam as a method of permitting. And then the future, in our opinion is integration between demand GIS. So not only you submit your BIM model, but there's GIS infrastructure in place that can do a lot of the checks that the municipalities or agencies need to do automatically on that platform. So that's what the future looks like. And then you look at different countries, they're all in different stages of that spectrum. With North America being unfortunately one of the earliest stages of permitting. So level one.


Eddie:

Well you know we go in and we're BIM guys here. And so I understand a lot of what you said, but I want to make sure that everybody understands ...what is GIS.


Arash:

Geographic information systems are basically a layer of information that connects data to their geographical location. So you can basically in an E permitting environment, what the GIS would be, for example, is you're wanting to build a building in a location, you want to understand who are the applicable licenses that actually have a say on that piece of land or are there heritage groups that have jurisdiction. And you have conservation authorities that have jurisdiction. Do you have task rotation agencies that have jurisdiction? Being able to identify (a) who's got jurisdiction and (b) what are the limits of those jurisdictions? So that's why GIS could be very helpful.


Tyler:

So it's automating, alerting, like alerting specific groups, making sure that you're getting that information over to the right people without really having to go and sort through your email and say, "Oh, they might need it. They might need it" in a bunch of checklists and all that.


Arash:

Well, yeah, identifying is the first step, but also being able to process. So when you do go to the conservation authority, you have a piece of land we want to develop, you go to the conservation authority, they're going to take up their drawings and they're going say, well, "here is a setback that you have from that river at the back, or there's a setback from this green space that's coming in." Or they could give you some other restrictions. A lot of that could be GIS based. So whatever is GIS based, it could be automated. There's really no reason for you to go to that agency and for somebody to sit down and open up a drawing for you and tell you whether they have jurisdiction or not. So identification is the first step. But also we want to get into processes and even with building codes. Building codes the whole other story, and getting it to building codes may be on a different topic, but the application of building codes and enforcement of the building code could definitely be automated for the most part, not all of it, but for the most part, if you have a submission of BIM into the municipality, we can do a lot of the checks that they did manually automatically before you even hit the municipality.


Tyler:

One of the things that I've wanted for years is the ability to be able to submit a BIM model to a municipality and have them go through the permitting process with that. Because what that allows us to do is basically eliminate 2d documentation in a lot of cases and a lot of repeat work, if we're honest. Because I mean, if we're an architect and we're going to pass it down to the engineer, the engineer is going to build their model and then the engineer is going to pass it down to us. And we're going to build our model. It's like model, model, model, but we're going model to 2d back to model, back to 2d, it's all over the place. So I guess what I've been kind of an advocate for and what we've been an advocate for is like, let's just keep it all in one location, as much as we can in one format and push it in. I guess I kind of figured that Canada would be doing all right with this, but it doesn't really sound like y'all are doing any better than us in this regard either.


Arash:

No, we're not. But there are others out there who are doing a pretty good job at it. Singapore is an example. In 1995, they launched their first e-permitting platform. And that was basically level one, e-permitting submission of PDF drawings, that's where you're moving to right now. So they're about the gut, a good 20 something years on us on that. There are European countries that are accessing BIM now. And so there's a lot of precedents right now in front of us. Yes, we are behind, but the good news is [there are] lots of examples in front of us, lots of lessons learned. And what we could do now is we can catch up to all those different jurisdictions very quickly, a lot faster than what they have to go. There are advantages of going last and this is one of them. The pain in the industry has been there for a long time. So that's a disadvantage, but the good news is if the governments step in, now they can catch up with other governments a lot quicker than they would have been able to 10 years ago.


Eddie:

Here we are in North America, still submitting nine sets of wet stamp drawings to the municipality, depending on where we at because you never do know until you kind of get into the weeds there. What are you seeing helping others around the world, get through this process and move it forward? I mean, 1995 is a long time ago for Singapore.


Arash: (15:45)

Government, I think at the end of the day it has to be done by the government. Because with Singapore or UK, when they went to these platforms, they also provided a lot of training, a lot of support to the industry to bring everybody up to speed, right? The advantage here is that the industry has been doing this for quite some time. So the government is just lacking behind. In UK and Singapore, the government was pulling the industry up saying here's the permitting, here's digitization, here's a BIM mandate and I'm going to support you so that you can comply with these matters. What we have here in Canada and in the US is that the design committee is already on BIM. The industry is already using them. And if you're just getting the garments to please catch up to us, right? So that's what it takes. Governments have to step up.


Tyler:

How can you facilitate that? Because I mean, from our end, we're looking here and we're contractors, right? We want to be able to push that change in our own municipality, in our own local area. What's the best way to do that?


Arash:

Rallying up support. And that's what we've been doing here in Canada. So we've started with Ontario as one jurisdiction, the province of Ontario, and we started an initiative called 1-Ontario, and we said, you know what? Let's put everybody together. Let's talk to everybody and see, who's willing to jump on. So right now we have the developer community. So we have the residential and the ICI sector signed up. On the municipality side, we have planners, building officials, and chief administrators who've signed up. And we have technology providers, the BIM groups building a smart. Both the Canadian chapter and the local chapter have signed up.


And then we have the E-permitting providers who have signed up, a number of them have signed up. And so, you know what? We're willing to comply with the standards, but get this done, please. So right now in Canada and the US, there's a lot of government funding that's being announced for the digitization of different things, but including government services to what we're doing. And really we are rallying up support and then submitting a proposal to the government saying "Hey, the industry is here. All of us are here. We've all signed up to do to get this done. Now we want you to step in and do your part." So that's the strategy that we've chosen here. And that's basically what my recommendation would be for anybody else is rallying support. Because once we are together, we are actually a very strong industry, as you are well aware. And the challenge is that we rarely come together but when we do come together. it's going to be very difficult for us to be ignored.


Eddie: (18:23)

I want to run us maybe a little off of the rails here. There's just like this creative side of me that doesn't take hold very much, has taken hold of me. Something special is happening right now. I've often thought that it would be cool to apply the thought of a digital twin to the entirety of a city. And what you're talking about with the fourth level, the, I'd say, the third step of the actual digitization of this process is just that. You would have the ability to geospatially relate a model to where it is in a city and then basically have the built environment in a virtual environment. Right? So, I mean, do you see that out there? I mean, I'm just, crystal ball moment, do you see that out there for us? Where, when we go to do a renovation, the municipality is going to have that information available in some sort of virtual built environment?


Arash:

The reality is, it's not a technology question. What you're describing is doable today. We have the technology, we have all the different pieces and the challenge is putting those pieces together. And when you talk about smart cities or digital models at a city level, again, it goes back to the government, right? So we got to see if the government has any appetite because imagine if the government were to say that if you stop making your BIM model, you get your payments faster. Like, I can't think of any other motivator to get BIM adopted in the industry. Because when we talk to our industry partners, especially on the residential side, they're obviously a little hesitant, in a sense, that they'd be doing the same thing for decades, it's working, everything is going well, why change? Why rock the boat? Right? But when you tell them what you can get your permits faster, then they're listening like, "Oh, let's talk about that." Right? So again, it just comes back to permitting because if you can catch them at that early stage, if you can motivate the industry to not only go on BIM but develop a standard BIM, then we can all be on the same language, the same level of BIM.


And then putting that, what you just described then that just comes naturally, because if you have all the BIM models and you've got a GIS infrastructure in place, then you already have what you described. And there's one entity that can do it, is a government who's actually processing the permits because you can catch them very early on. You can go a little bit further. You can say that "you know what, I'm gonna do my inspections" because all of us are used to doing inspections. Inspectors come to our site for inspection. Once you have the BIM model at the municipality, then you can submit as-built BIM models and the inspections can be done automatically. Right? So we are responding with the permits because that's the first step. But once you have the BIM at the municipal level, then you can push a lot of things down the supply chain. So to answer your question, completely doable. What does it take? It takes at least one government that's willing to try something new. So that could be done at a city level, provincial or state level, but absolutely doable. So anybody hears this podcast and running any sort of government, now is the time. You can be the first in North America to actually get this done. The technology is there. We just have to do it.


Tyler:

Yeah. The technology is definitely there, I think a lot of it is the education too. I'm curious what you've been doing to help educate those people within the municipalities, because, you know, obviously they're set in their ways and that's going to be probably your biggest issue moving this forward. So how have you guys been educating people so that they're comfortable manipulating BIM models and, and looking in a 3d space versus what they're used to with 2d?


Arash: (22:35)

That's a big one and there are a few things I want to unpack there. From a municipal standpoint, first of all, they don't need to become incapable in the sense that they don't necessarily need to deal with the BIM cost directly. What we're proposing here, I'm telling you, is one platform that can take BIM files in and we'll work on building smart to basically define what that standard needs to look like. But once the BIM file comes in, then we can translate that and break it down to whatever municipalities need to meet to process. So the processing can be done centrally. And I think that's going to be the key to getting BIM into our municipalities. Because expecting every single municipality to have a BIM expert on staff, that's just unrealistic. Especially with some smaller municipalities, that's just not going to happen anytime soon. But what we're proposing instead is that let's submit the BIM model to this central agency if you will, and then that processing can be done centrally. And then if the municipality is more comfortable doing PDF drawings well we can create a PDF set of drawings based on that, BIM file and send it to them. But if they want more information, they can always come back to the central agency, if you will, to get more information.


Also, a lot of the checks that they do manually on those drawings we can do on the BIM file and just send them the report. And here are all the checks, we've checked all the room sizes, all the ceiling heights, everything is done here is the report. So I think what it comes down to is being able to centralize that BIM processing. So instead of every single company and every single municipality, having to get BIM expertise, you could do that in a much more efficient manner in a central location. So that's part of it, I think.


But going back to the education piece, I think we need a paradigm shift here. I'm the researcher at the Toronto BIM community and also on the board of directors of building smart talent. What got decided was that we got to stop calling it BIM because when you keep saying BIM you're eliminating a whole bunch of the industry that doesn't understand what you're talking about. The reality is its digital construction or whatever else you want to call it. BIM is just a tool that we use. So instead of calling these entities, BIM communities, and BIM groups, I think we want to kind of move away from that. And start calling it digital construction, digital buildings, and that I think is more welcoming to the outside players to kind of get in. And because digitalization is stopping, people can wrap their heads around it. BIM is more complex and means different things to different people. In doing that, we started offering seminars and webinars to our BIM groups. They started offering seminars to everybody else except our group, because whoever is on the BIM committee, they've been sold and they understand BIM, they're using it and they know what it is.


So we want to start doing some outward education, so going to different groups and educating them on digital construction and what BIM can do for them. I think that's a paradigm shift. Instead of servicing our own community, we got to start servicing everybody else out there. And what you will see is, the surprise, there is more appetite than you would think. We've done pre-national BIM surveys in Canada. And the numbers are just punishing in terms of the level of interest and the level of buying that exists from an industrial sector, as well as even municipalities. It's still the government leadership that's still a challenge, but people working at municipalities, a good number of them are actually interested to learn more. They're tired of doing the same thing over and over. That's just that the management level and higher that's where the, a lot of the brick wall that we have to break. There is more appetite than I would have imagined at the municipal level today.


Eddie:

I feel like the residential construction market is kind of like this elephant in the room, to say the least, I mean this is a lot of the construction that happens. And I don't want to cast shade on our residential brothers, but a lot of times perception is reality. It's not as digitized as say large commercial projects are. And so how is that a kind of a hurdle to get over, an obstacle that you're dealing with?


Arash: (27:08)

That's unfortunately true. But, but you gotta think about why is that. The reason they have a more complex and ICI sector more on BIM is that it's just more complex products. There's a lot more at stake, a lot more coordination that needs to happen, and also the contract setup is just something that makes sense. Because if you're building a hospital or if you're building a school, well that project is going to stick around for quite some time and it's going to have a single owner. So it's about easier to sell the owner on the idea of BIM and then use BIM for the long-term operation and maintenance of facilities. It's the costs to residential that's a whole different game.


And the owners, first of all, there is no one owner, are less sophisticated, and they don't own the facility, or they don't own the assets for a long time, they switch over to different ownership. So that's part of it, but also the residential side, it's just not as complex. So how do you get the residential sector to adopt BIM permitting? If you can give them faster permits, I honestly think that's the way to do it because in our conversations at least yes, the margins are low. Yes, the technology, you don't need the technology, we can do the thing. Yes. We hear all that. Well, we also want to do whatever it takes to get a permit faster. And it's a question of years, not months anymore, at least here in Ontario. Sometimes projects are in the permitting process for three to five years. So if you can shave six months or a year or two years from that timeframe, that's worth a lot of money to developers and to everybody involved.


So that's why, at the end of it, it's a money discussion, right? Does it make financial sense for you to adopt it today for the residential side? It may not. Right. But if you actually get your permits faster, then it most definitely will make sense to adopt them. So I think that's the angle we've chosen. You know what, let's push BIM for permitting. And in talking to our residential folks, that's the last job and that's where the yes comes in. "If you can get me my permit faster, I'm willing to jump to this one other group." When I put myself in their shoes if I'm investing in BIM and if I'm then printing on paper and submitting that to the municipalities, and then I have a set of paper as my site and my trades are all on paper, then what is that before? We get it right. So I think it has to start with permitting and once we get there, then everything else can fall into place.


Tyler:

I don't think we can overstate the impact of getting to the site quicker. Because I mean, we've talked to how many people lately, even who talk about, "Hey, it's time to site that matters." That amount of time, if you can cut that down, then your owner is able to occupy the building quicker and start making money quicker, which makes them happier quicker. And if you're bogged down for three to five years, in some cases, getting your permitting done on a large structure, how many other things could they build in that time if they could just get into the building? This is a massive issue. If it's taking that long, I don't think I completely understood how long it was taking. I knew it took time, but I didn't realize how long it could take. Like it could take years to do this.


I think this is a valuable addition to any municipality looking at growing their community from an economic standpoint because if I'm trying to attract Tesla to come to my town and build a new Gigafactory, that's a bargaining chip. If you can come to them and say, "we'll get you built quicker than anybody else here because we have, you know, these digital tools that we use, it's a proven process, we can get this in and out, and we're going to save you two years." From Tesla's point of view or anybody else out there doing that GM, manufacturing facilities are kind of where I'm looking right now. I can see us here in Milledgeville. We've had trouble attracting business in that regard. There's been chatter, but it's never happened, but this could be a bargaining chip for a lot of people to start attracting those big companies to their town to potentially bring jobs and help the overall city just get boosted.


Arash: (31:41)

That's absolutely correct. That's absolutely correct. And that could make a difference in the near future. And I do want to touch on something though. We talked about municipalities and the need that they have to go digital. The reality is, even with the e-permitting solutions that are out there right now. Let's say you're municipality picks up state-of-the-art stuff, e-permitting, BIM submission, and the whole nine yards. The reality is for you to get a construction permit or all the payments that you need for a construction project, it has to go above and beyond the municipality. There's going to be conservation authorities, there's going to be heritage, they're going to be other things provincially or statewide that need to come.


So, and that's where it really falls apart here in Ontario. And the beauty of my role is that I talk to all the different stakeholders so I can understand their perspectives. So when you talk about conservation authorities, for example, a single conservation authority in Ontario may deal with 20 to 30 different municipalities, so these municipalities are now picking up the e-permitting solutions and they're digitizing the internal processes. But when they want to send that information to the conservation authority for comment, and they're saying "Hey, come to my platform, login and you can see everything you want to see." But from their perspective, it's 20 different log-Ins across 20 different municipalities, different systems, and everyone is operating very differently.


So at the end of the day, what they say is "fax it in. So do your automation do whatever you're doing, then fax it in." And I thought they were joking. It is what it is. You either fax it in or you email it in, right? And there is no other way for them to do it. It just makes no sense for them to log into all these different systems that they change every other year, too. So that's why in 1-Ontario, our initiative that we're proposing is a central review platform. All the conservation authorities, all the different agencies that need to comment on applications, come on this one platform. And then all the e-permitting providers can connect to the same platform. It's just a bunch of APIs that needs to be created. But what that means is if I'm a conservation authority and I'm dealing with 20 minutes of policies, well I only have one login, I'll talk to this one system. And I see all the permits that I have to review. All that information could be pushed to me automatically from the e-permitting system.


So what our organization is doing, we are not competing in the e-permitting platform. We are saying, "you know what, pick whatever you want to pick. And there needs to be an open market, and we want to make it a level playing field for all the e-permitting providers." So pick what your municipality is more comfortable with, but have those providers comply with the data exchange standards. So we can then connect everybody else to the same standard. And we can start pushing that information back and forth so that you don't have to go to fax or email to exchange information. I think when you think about those three to five years, it's not sitting at a single-minute priority. They're waiting for feedback from 10 different agencies. And it's an email that was sent. we'll see when that email is going to get replied to. This is really no transparency. There's no visibility into that process from a provincial or state level perspective. And that's what it's going to take. And for that, we need the government at the table, right? Because all those agencies at the end of the day, are under one state or one province, e-permitting alone will not solve it. You actually need the zeal of the government to bring everybody together.


Eddie:

I wanted to take a quick minute to explain something to Tyler. A fax machine is this box that has a telephone line, like an actual line that goes into...


Tyler:

What's a telephone line? What's that, I don't...


Eddie:

Have you ever sent a fax?


Tyler:

I can't. Yeah, no, I haven't.


Eddie:

Tyler has never sent a fax.


Tyler:

I have never sent a fax in my life.


Arash: (35:37)

Well, you're going to like this one then. So as part of COVID, we're talking to the different agencies and kind of talking about what were the solutions for dealing with COVID and working remotely? And one of the innovations that came up was curbside pickup. So we have agencies picking up forms, from curbside pick up from one place to another, to be able to review forms. So one step before fax.


Tyler:

I'm doing the math, carry the one, are they using cars with round wheels?


Arash:

You can send pigeons. I mean, you laugh but this is what it is. This is what we're dealing with right now,


Tyler:

We're going back to the pony express here. Just like, get the horses out, I mean, good grief. Oh my gosh. Save on gas. Holy cow.


Eddie:

I want to digress a little bit or go back a little bit, but I think we're in a completely digressive state. Thanks to me. I'm sorry. But I think that the BIM process is going to be held to task by this because one thing we see is that the 2d documents, reign, and rule. And so when we're handed things to work from, it's always like with this reminder that, what's on that 2d sheet, that's what matters. So if we get a model we're oftentimes asked to sign away our firstborn children to get the model. And then we swear that we will not hold anybody to task on what's in the model. We'll just look at it, we'll say five hail Mary's. On my, on my honor. And this is going to change that because designers will then be held to task on a digital level based on the 3d information that they submit. I love that. I love what it's going to force. We're going to have to do it right.


Arash:

Well, the thing is even on 2d drawings, it's the same thing. It's a contractual language that we all need to agree on, but then you're submitting a drawing, so whether that's a model or a 2D the level of detail yet, there's a lot of things to worry about, but it's a change that we can handle. I think our design community can handle it.


Eddie:

Yeah, we can. And in the kind of things that I'm talking about are, you know, when you have that dimension, that's sitting on the PDF and I could easily even go in and blue beam or Doby or something and just kind of scrub out the three-foot and put three foot six. Now my area is ADA compliant because of that three-foot six, but the model doesn't actually reflect that. It wasn't actually changed in the digital copy of the building. Those are the sorts of things we're going to want to go back and actually do it right. Which the trickle down of the design process and the way we've digitized designers, they're forcing people's hands on this because they need fidelity in the model. And so I just see this forcing that fidelity, but again, kind of a sidebar there. I do think it's a cool effect. Another thing too, there are two sides to this.


One is the side that Tyler's talking about speed to market so that I can now produce and, or make money on the building that has a usage. The other side of it though is material costs. So I love or as what you're saying with, "I'm going to get you through permitting faster" because we are seeing on the commercial side, I know of a job right now, a courthouse in Georgia, that the numbers went up 300K in two months because of the material costs being just haywire right now. So how much value is there, there to get that kind of building to market faster. I've also heard in the residential market, houses are going up $30,000 because of wood price. And so there is a real stake in trying to get there faster. And when you're talking three years, how do you project what this is going to actually cost to build? How could you conceivably do that? People aren't even holding numbers for 120 days right now.


Arash:

Well, you have to jack up prices. That's the only way you can survive. You have to get your price. That's what prices keep going up because there's so much risk that the developer has to absorb by (a) waiting on the project for five years and (b) all of these other unknowns that happen. So absolutely it's going to attract more investment. And to your point into municipalities, we're actually servicing the industry better including the faster permits. But I think another part of it is too, we gotta educate the owners that what is the long-term benefit of this. Yes, we can give you some benefits of the problem with permitting and whatnot, but the reality of it is having a proper as-built in model. That's going to save you tons in the longterm in operating and managing that asset. And I think that's a piece that's often overlooked. And to me, 10%, 20% benefits in design and construction, another 80% doing operations that are not really talked about too often, but that's where BIM can shine. When you want to do renovations, if you want to do maintenance, if you want to do anything on the operations...and there's a whole bunch of products coming up in the pipeline specifically for servicing BIM operations. So by having that asset, you're going to have a lot more tools in the near future to use those digital assets for your operations. So invest in it now and trust that solutions will come in the coming years.


Tyler:

Well, I think that might've been part of your megaphone question, but honestly let's go back. Let's ask you our megaphone question. So if we gave you a megaphone that the whole industry could hear and around 60 seconds, what would you want to say?


Arash: (41:43)

That's a tough one. I do have a lot of other things, but I think what I've learned during my career is that we are a very strong industry and we can get a lot of things done together. The challenge is that we don't talk to each other often enough, and that's why I love what you guys are doing in this show and being able to get the word out so that we hear each other's opinions. I think if we can assemble together properly if this industry can assemble, we can get anything done, BIM submission is the least of our worries. If we can come together as an industry, and when I say industry I mean, AECO. So architects,