C.A.S.H. WORKSHOP Planning for the Building Season: Exploring and Understanding Project Delivery Methods Friday, December 3, 2010 9:00 a.m. to 3:00 p.m. Ontario Airport Radisson 2200 East Holt Boulevard Ontario, California Construction Management Multiple Prime and Construction Management at Risk ED MIERAU Neff Construction CALIFORNIA S COALITION for ADEQUATE SCHOOL HOUSING 1130 K Street, Suite 210 Sacramento, CA 95814 Phone (916) 448-8577 Fax (916) 448-7495 www.cashnet.org Handout materials are available online after the workshop. To download the materials, visit www.cashnet.org/meetings and click on the link labeled Workshop and Conference Handouts.
C.A.S.H. WORKSHOP Planning for the Building Season: Exploring and Understanding Project Delivery Methods Tuesday, December 7, 2010 9:00 a.m. to 3:00 p.m. Doubletree Hotel 2001 Point West Way Sacramento, California Construction Management Multiple Prime and Construction Management at Risk ED MIERAU Neff Construction CALIFORNIA S COALITION for ADEQUATE SCHOOL HOUSING 1130 K Street, Suite 210 Sacramento, CA 95814 Phone (916) 448-8577 Fax (916) 448-7495 www.cashnet.org Handout materials are available online after the workshop. To download the materials, visit www.cashnet.org/meetings and click on the link labeled Workshop and Conference Handouts.
Construction Management Multiple Prime and At-Risk: A Practitioner s Perspective Ed Mierau President, Neff Construction, Inc. C.A.S.H. Board Member Officer, ACCM Construction Management Taken Generally A Brief Historical Perspective The transition to CM in the early 1990 s A way to hire a builder in the absence of formal bidding Move toward prime contracts with individual trade contractors OPSC/Lease Purchase Program developments OPSC/SFP changes The importance of bonding at the trade contractor level The move away from combination bids Current market-place considerations» Targeted prequalification» Subcontractor bonding
Best Use of Construction Management A Typical List of Construction Management Services Preconstruction Services» Project Feasibility» Scheduling» Budgeting/Estimating» Periodic Plan Review» V/E During Design Development Bid Phase Services» Scoping Effort/General Conditions Development» Construction Schedule Development» Bidder Interest/Document Reproduction/Distribution» Legal Advertisements» Pre-bid Conferences/Bidder Inquiries» Bid Opening and Evaluation Processes» NOA/NTP Issuance Best Use of Construction Management Cont. Construction Phase Services» Construction/Contract Administration» Site Supervision» Schedule Management» Budget Management» Local Agency Interface» Project Completion/Closeout Services Post Construction Phase Services» Warranty/Guarantee Services» Closeout/Audit Services» Construction Defect Assistance Additional Services» Litigation Assistance» Follow-on Project Assistance
The Construction Management Procurement Model Design Services Procured Separately Construction Manager Procurement as a Professional Service Qualification Based Selection Proposal Based Selection Trade Contractor Selection Process Formal Bid Some Limitations Commonly Associated with CM Does Not Allow for the Innovations Associated with Some of the Other Alternatives Most processes/procedures have been fixed by practice over time Trade contractors have become more sophisticated and litigious delay claims have become more common Lack of a single GMP for construction or design and construction Some Primary Areas of Risk» Plan and Document Deficiencies» Site Unknowns» Outside Agency Impacts» District Changes Change order limit issues Formal bid process for trade contractor selection has become contentious Multiple prime contracts equate to added administration and multiple points of risk Potential overlap of services with the architect or a program manager
Construction Management at Risk Process Considerations Construction Manager selected as per the previous slide preconstruction and bid phase services remain in place Construction Management agreement anticipates a transition to a general contractor after the formal multiple trade bids on the project have been awarded Multiple/Plural Prime Trade Contractors determined through a formal bid process Construction documents contain a provision that the low bidder s prime contracts are to be assigned as subcontracts to the Construction Manager Construction Manager transitions to a General Contractor in accordance with the provision mentioned above A construction contingency is generally included in the fixed price Can have a GMP Generally a sharing provision is included CM At Risk Concerns Self performance of trade contractor work Establishment of and Uses for the Contingency Fund CM/GC Transition Issues Risk Allocation and Pricing Sources of Litigation Potential GC/Trade Contractor Union Issues Bonding Considerations
Some Recent Legislative Challenges to Alternative Delivery Methods SB 258 (Oropeza, 2010) Prequalification AB 2216 (Fuentes, 2010) Retention SB 802 (Leno, 2009) Retention SB 614 (Simitian, 2008) - Retention SB 694 (Correa, 2009) LLB AB 1486 (Dutra, 2004) LLB