a

June 20, 2012

Alternative Delivery for

Municipal Water & Wastewater Projects in 2012

OWEA 2012

Making a Pass at Going Green …

Looking Towards the Future

Dennis Tinkler, P.E.

Ohio’s Methods of Performing Public Construction

Ohio Construction Reform (OCR) – Alternative Project Delivery Methods

Is a Work in Progress

Chartered Cities vs. Other Jurisdictions

Single-Prime Design/Bid/Build (D/B/B)

Design/Build (D/B) project delivery

Construction Manager at Risk (CMR) delivery

Making a Pass at Going Green ($) … Looking Towards the Future

General Contractor Led D/B

Actions to Move Us Forward

2

Agenda

Ohio Construction Reform (OCR)

June 2011: OCR HB 153 signed by Governor

Alternative Project Delivery Methods:

Retains multiple-prime Design/Bid/Build (D/B/B)

project delivery (not recommended)

Retains Construction Manager (CM) as agent delivery

Allows Single-Prime D/B/B*

Allows Construction Manager at Risk (CMR)*

Allows Design/Build (D/B)*

Allows for open-book Guaranteed Maximum Price

(GMP), design-assist, and subcontractor

prequalification within D/B and CMR delivery

methods First changes in Ohio’s method

of performing public

construction in over 134 years!

3

*To be discussed further today…

2012: Ohio Construction Reform – Work in Progress

Check this website for updates on Ohio

Construction Reform: http://ocr.ohio.gov/

Allows Single-Prime D/B/B…

CMR documents final in February 2012

D/B documents final in April 2012

CMR and D/B Standard Requirements for

Public Facility documents are a Work in

Progress … and are expected to be

updated for Water/Wastewater projects

4

Go To: http://ocr.ohio.gov/

to sign up for updates,

make comments, learn, etc.

OCR: Chartered Cities vs. Other Jurisdictions Alternative Delivery Requirements for Ohio Public Water/Wastewater Facilities

OCR not

Applicable

Ohio

Administrative

Rules Apply

Much flexibility to

select best value

of Numerous

Alternative

Delivery Methods

Chartered Cities Jurisdictions including Non-Chartered

Cities, Villages, Townships, Etc.

5

OCR

Applies

OCR

Developed

for State

Work

BUSINESS! – Jacob Marley

OCR is a Work in Progress and

did not generally consider

Water/Wastewater Projects

OCR: Single-Prime D/B/B

Owner Advantages

All Parties are Familiar

Time-Tested Process

Allows Thorough Collaboration/ Input between

Owner and Design Engineer

Owner Disadvantages

Takes Time – Linear Process

Min. Collaboration between Engineer & Contractor

Risks to Owner

Relies on Engineer’s Estimates

Errors and Omissions result in Change Orders (but

much less than Multi-Prime)

Workable Project

6

Engineer

GC

Owner

Contractual Relationships

Working Relationships

Trade Subcontractors

OCR: CMR (“D/B Lite”)

Owner Advantages

CMR Pre-Construction Services: Improved Constructability,

Pricing, and Possibly Schedule

Price Guaranteed Maximum Price (GMP) During Design

Reduces Project Risk, Contingency, Design Omissions –

thereby less potential of Change Order

Prequalification of Subcontractors may Increase Quality

Owner Disadvantages

No Single Responsible Party – Separate

Design/Construction Contracts

Engineer and CMR “forced marriage”

Relies on Criteria Engineer for Initial Estimates

Complex GMP Process – Risk of Agreement

Added Costs for CMR Pre-Con Services

7

Engineer

CMR

Owner

Contractual Relationships

Working Relationships

Trade Subcontractors

Owner Advantages

Single Point of Contact and Single Contract for

Performance and Guarantees

Owner Disadvantages (Just for Starts)

Subcontracting Process is Burdensome:

Project Cost Unknown until final Subcontract Packages

are designed, bid, and awarded

Public Owners will need significant staff to review

Subcontract Packages

Higher Design Costs

Will Delay Project and Add Administrative Costs;

Project at Risk to Proceed unless all Sub Packages are

designed, bid, and awarded

Key Subcontractors are not Members of D/B Team and;

therefore, do not provide meaningful innovation

OCR: Design/Build

8

Contractual Relationships

Working Relationships

Design/Builder

Trade Subcontractors

Criteria

Engineer Owner

Government does not solve

problems; it subsidizes

them. Ronald Reagan

Owner Disadvantages

Procurement can be Complex

(Evaluated Bid)

Limited to Predict what will be Proposed (if

Minimal Criteria Design for Complex

Project)

Price may include Significant Costs to offset

Risk (if Minimal Criteria Design for

Complex Project)

Possible Limited Owner and D/B Team

Collaboration

Looking Toward the Future …

General Contractor Led Design/Build

9

Contractual Relationships

Working Relationships

Criteria

Engineer City

Design/Builder

Trade Subcontractors

Why Select GC Led Design/Build?

Single-Point of Responsibility

D/B Team (GC, Engineer, Subs) is Highly

Collaborative with Owner

Deliver Project Quickly - Problem Solved

Costs:

Earliest GMP (Lump Sum with Proposal)

Low Procurement Costs

Competition: Minimize Design/Construction

Costs

Potential for Maximum Innovation

No Contractor Led Change Order

Looking Toward the Future …

Most D/B Projects in US are

General Contractor Led Design/Build

Source: The Water Design/Build Council

10

Evaluate Proposals: What’s Important to Customers?

For Example, we “ran into” Changes in Site Conditions

Rather than going to Our own separate Corners and then

arguing, delaying, sending letters, holding meetings…

…we solved the problems together as a Team with No

Project Delay.

As a Team, we completed Value Engineering and

Constructability Review to:

Improve Facility Operations, Safety, and Reliability

Improve Odor Control Design to Reduce Both Construction

and Lifecycle Costs

Later, Kokosing D/B Team was selected for $10M

Sewer D/B Project (Repeat Business)

Looking Toward the Future …General Contractor Led Design/Build

Delaware, Ohio Upper Olentangy Water Reclamation Center

11

The Team developed Trust and, as a

result, delivered more Value for the

same Cost to the City

Take Advantage of Ohio Construction Reform (OCR)

After 134 Years, Stop the Craziness … Get Rid of Multi-Prime Design/Bid/Build

Owners – Use Alternative Project Delivery that is most Advantageous to Your Customers

Invest Time, Training, and Resources to Learn about all Alternative Delivery Methods

Understand Advantages and Disadvantages of Each Alternative Project Delivery Method

Recognize that any Alternative Delivery Method can Work with Proper Planning,

Execution, and the Right Team

Recognize that Owner must have strong leader to follow through with new Alternatives

Encourage Ohio Department of Administrative Service to Update D/B Subcontractor Rules

Go to http://ocr.ohio.gov/ and submit comments

Looking Toward the Future …

Actions to Move Us Forward

12

Source: The

Water

Design/Build

Council

a

Questions & Answers

13

a

June 20, 2012

OWEA 2012

Making a Pass at Going Green …

Looking Towards the Future