CMGC

1. CMGC Construction Manager General Contractor Colorado DOT February , 2012 1

2. Content • Definition of CM/GC • Contractual relationships • Comparison between CM/GC, D-B, and D-B-B • Timeline Comparison • CM/GC Benefits • Risk Theory • Costs

3. What is CMGC? A Project Team consisting of three components: • An Owner • A Contract with a Designer • A Two Phase Contract with a General contractor • Phase one – A “Construction Management” consulting contract to help with design • Phase two – A “General Contracting “ contract to build the project 3

4. Overview CMGC Contract Structure A Project Team consisting of three components 1 1 • Owner • A Contract with a Designer • A Two Phase Contract with a General contractor • Phase one – A “Construction Management” consulting contract to help with design • Phase two – A “General Contracting “ contract to build the project Owner 2 3 2 CMGC 3 Phase 1: Construction Management Designer Design Phase One RFP Phase 2: General Contracting Construction Phase 4

5. Design Consultant CMGC Process Plan OWNER Design Contractor Bid/Explain/Agree OWNER Build Bid Build Contractor

6. Design Team Selection Phase 6

7. Transition to Construction (Negotiation or Bid) 7

8. High Level CMGC Process Procurement Design Process with CM Services “GMP Ready” 1. Technical 2. Price GMP Submission Yes GMP Accepted Explain/Agree? No No Yes Construction Contract Awarded to CM Alternate Delivery of Project GMP – Guaranteed Maximum Price CM – Construction Manager 8

9. Contracting Types FHWA’s EDC Project Delivery Initiatives Design-Bid-Build CMGC Design-Build Leverage Current process 9

10. CMGC Highlights • Key Finding FHWA Utah Peer Exchange 2011: • CMGC/CMAR project delivery “is a less radical shift in procurement culture than design-build…” • Owner retains control of the design • Designer is true owner’s representative 49

11. Who is Using CMGC/CMAR? • Research done in 2009 (NCHRP Synthesis 402) • Five states were using CMGC/CMAR – AK, OR, UT, FL, AZ • Six additional States have legislative authority • Quick look at current conditions (2011) • Now Using/ working on CMGC/CMAR: MI, CO, CFL, MTO, ME, WFL and NV • EDC follow ups to EFL + 9 others 58 11

12. Construction Manager-at-Risk Project Delivery for Highway Programs - 2009 NCHRP Synthesis 402 New Research 10-85 -“ A Guidebook for CMGC contracting for Highway projects” – 2012 New Research 15-46 – “Design-Management Guide for Design-Build and Construction Manager/ General Contractor Projects” - 2013

13. CMGC is not CM@Risk • The process is not the vertical world of CM@Risk– similar but different • Transportation industry projects are different and require a process of their own • Self-performance requirements are typical • Subcontractor procurement process is different • CMGC relies on best-value selection • GMP timing 13

14. CMGC is not CMAR With CMAR: • Negotiated prices vs. “BID” • Very little owner involvement during construction • Contractor selection is QBS vs. Best Value • Focus is on Quality vs. Risk and Price 46 14

15. BIG Picture Theories with CMGC • Collaboration • Risk Theory • Schedule • Model to Implement Innovation 15

16. CMGC Contracting CMGC is an integrated team approach to the planning, design and construction of highway projects.

17. Contracting Types ComparedRisk Theory Lower Risks Design-Bid-Build CMGC Design-Build Total Amount of Risk Owner Shared Contractor Primary bearer of Risk: Higher Lower Higher Relative Level of Risk Disconnect between design and construction leads to suboptimal design decisions and construction delays. Collaborative design process leads to readily constructible plans, faster construction times, and innovative approaches. Owner relinquishes control of design and construction to gain speed of delivery Drivers of Risk:

18. Contracting Types ComparedScheduling/Timeline perspective Faster Schedules CMGC Achieves faster project delivery through increased concurrence of activities Pre-design Selection Owner Design-Bid-Build Designer Design Construction Contractor Pre-design Selection Owner Design-Build Design-Builder Design Design Review Construction Design Pre-Des. Selection Owner Design Design Review Designer CMGC CM/GC Design (CM) Construction (GC)

19. Model to Implement Innovation 19

20. OverviewKey Benefits of CMGC • Constructability • Collaborative Design Process • Competitive pricing • Reduced Risk • Relationship Building • Speed of Delivery 20

21. What does an owner expect? Can all of these be improved? • Better Designs • Better, Faster schedules • Lower risk • Lower costs • Savings in design • Savings in constructability • Savings in innovation Scope Schedule Budget 21

22. Contract Components Project Delivery Method • DBB; CMGC; DB Procurement Procedure • Low Bid; Best Value; Qualifications-based; Sole Source Contract Payment Provision • Lump Sum; Guaranteed Maximum Price; Cost Plus Fee; Cost Reimbursable; Unit Prices • Doug GransbergPhd. Iowa State. 22

23. Contract ComponentsWhere are we now? Project Delivery Method • DBB; CMGC; DB Procurement Procedure • Low Bid; Best Value; Qualifications-based; Sole Source Contract Payment Provision • Lump Sum; Guaranteed Maximum Price; Cost Plus Fee; Cost Reimbursable; Unit Prices • Doug GransbergPhd. Iowa State. 23

24. Contract ComponentsWhere is CMGC? Project Delivery Method • DBB; CMGC; DB Procurement Procedure • Low Bid; Best Value; Qualifications-based; Sole Source Contract Payment Provision • Lump Sum; Guaranteed Maximum Price; Cost Plus Fee; Cost Reimbursable; Unit Prices • Doug GransbergPhd. Iowa State. 24

25. Evolution of Technical Proposal Scoring Criteria 25

26. EDC Initiative 61

27. FHWA’s Long Term Project Delivery Goals • All contracting agencies should have a project delivery “toolbox” including: • Design-bid-build • Design-build • Construction Manager General Contractor (Construction Manager at-Risk) • Alliance Contracting • Performance Contracting • ID/IQ contracting • Other

28. New Zealand Selection Model Alliance DB DBB LS DBB Cost+ Dollars CMGC may be appropriate DBB M&V CM/GC Complexity, Risk, Potential for Innovation, Flexibility Required, Client Involvement, Supply vs Demand, Program Constraint *P10-0274: Design Build Contracting using a Competitively Negotiated Designby Eric Scheepbouer 28

29. CMGC Contract Technical Cost Collaborative Deliverables Plans SHOP DRWG As Builts Specs Doug Gransberg, Phd, Iowa State

30. What do Owners want from CMGC? Contractors ideas for difficult projects Cost savings Time Savings Interviews with Senior DOT MGRs, Fall 2011, Gransberg - McMinimee

31. What owners want - Innovations to Reduce Total Time Design Build CMGC/CM at Risk ABC A+B Total closure Lane Rental APC

32. New Business Model • New paradigm • Lowest construction cost • to lowest project cost • Societal costs minimized • Public praise • Political capital

33. What Does industry get from CMGC? • Better Designs – Hard to Quantify – Contractor satisfaction with plans, CO’s • Better schedules- Exceeded expectations • Lower costs • Savings in design- preliminary savings indicated 40% of design costs • Savings in constructability- preliminary savings indicated 8% of total project combination with innovation • Savings in innovation- preliminary savings indicated 8% combination with constructability

34. CMGC in ActionThe Bottom Line Lower Costs CMGC has delivered 15-16% cost savings and lower change orders for Utah Cost experience for UDOT, based on 18 state projects $330 million dollar program

35. 36

36. CMGC Contracting Bottom Line: CMGC is a good option for many transportation projects where the qualifications and cooperation of the contractor are critical to the success of the project.