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9/18/2011
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“The Value of CMGC as a Tool for “The Value of CMGC as a Tool for Infrastructure Project Delivery”Infrastructure Project Delivery”
Prepared for:Prepared for:
“International Public Works“International Public WorksInternational Public Works International Public Works Congress and Exposition”Congress and Exposition”
Prepared by:Prepared by:
September 18, 2011September 18, 20111
JMC Consulting
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Introduction
Learning Outcomes
APWA Peer Exchange
FHWA’s EDC Initiative
CMGC/CMAR D fi d
Discussion Road Map
2
CMGC/CMAR Defined
Osceola County Case Study
“Genuine leadership comes from the quality of your vision and your ability to spark others to extraordinary performance.”
— Jack Welch – Former GE Chairman and CEO70
Introduction
“Educational Consortium” Partners
JMC Consulting
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University of Florida Research Program
Accelerated Project Delivery Research
Dr. R. Edward Minchin Jr., P.E.
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Understand and Describe the distinctions between CMGC and CMAR
Learn about the value of having CMGC/CMAR in your “project delivery tool box”
Learning Outcomes
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Discover practical “lessons learned” from a successful program
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What experience do you currently have with CMGC and/or CMAR?
What are you hearing from your peers regarding CMGC and/or CMAR?
APWA Peer Exchange
Wh t i N b 1
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What is your Number 1 Question or Concern about CMGC and/or CMAR?
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EDC Initiative
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“Good is the enemy of great.”
- Jim Collins61
EDC Initiative Primary Directives:
EDC Initiative
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1. Accelerating Technology and Innovation Deployment
2. Shortening Project Delivery
Design-Build
Construction Manager/General Contractor (CMGC)
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Preliminary Goals - By December of 2012…
EDC Initiative
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100 CMGC contracts executed on Federal-aid or Federal Lands projects (1% of Federal Aid Program)
25 state, local, or Federal Land agencies have used CMGC
Increase the number of DB contracts executed for Federal-aid or Federal Lands projects by 50%
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Research done in 2009 (NCHRP Synthesis 402)
• Five states were using CMGC/CMAR – AK, OR, UT, FL, AZ
• Six additional States have legislative authority
Who is Using CMGC/CMAR?
Quick look at current conditions (2011)
• Now Using CMGC/CMAR: MI, CO, CFL, MTO, ME, and NV
• EDC follow ups to EFL + 9 others
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Salt Lake City, Utah – June 27 – 29, 2011
Participants
West Coast Peer Exchange Highlights
• Central Federal Lands Highway Division
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• Western Federal Lands Highway Division
• Sundt Construction
• Stanton Cost Estimating
JMC Consulting
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East Coast Peer Exchange – Coming Soon!
December 7 – 8, 2011
Boston, MA
Purpose – to group Owners with experience in CMGC with inexperienced Owners and exchange information and strategies for accomplishing FHWA’s EDC Initiative
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g p g
Build on success of Salt Lake City, Utah event
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Project Delivery Method
• DBB; CMGC; DB
Procurement Procedure
The New Paradigm: The Right Tool for the Right Job
• Low Bid; Best Value; Qualifications-based; Sole Source
Contract Payment Provision
• Lump Sum; Guaranteed Maximum Price; Cost Plus Fee; Cost Reimbursable, Unit price
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A Project Team consisting of three components:
An Owner
A Contract with a Designer
What are CMGC & CMAR
Phase one – A “Construction Management” consulting contract to help with design
Phase two – A “General Contracting “ contract to build the project
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g
A Two Phase Contract with a General contractor
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Design-Bid-Build CMGC/CMAR Design-Build
Contracting Types:FHWA’s EDC Project Delivery Initiatives
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Key Finding:
CMGC/CMAR project delivery “is a less radical shift in procurement culture than design-build…”
O t i t l f
CMGC Highlights
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Owner retains control of the design
Designer is true owner’s representative
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Transportation projects require a unique process – With CMGC:
Self-performance requirements are typical
Subcontractor procurement
CMGC is not CMAR
Subcontractor procurement process is different
CMGC relies on best-value selection
GMP timing
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With CMAR:
Negotiated prices vs. “BID”
Very little owner involvement during construction
CMGC is not CMAR
Contractor selection is QBS vs. Best Value
Focus is on Quality vs. Risk and Price
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CMGC/CMAR Contracting
Integrated team approach to the planning, design and construction of highway projects
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Risk Theory
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Schedule/Timeline Comparison
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Model to Implement Innovation
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Understanding the good and bad about Design-Bid-Build – 50 years of history
Generally, an understanding of Design-Build
What Leads Owners to CMGC/CMAR?
Looking for a model that takes advantage of the good in both methods
Not looking for a replacement – looking for an additional tool
“The Right Tool for the Right Job”
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CMGC/CMAR Process
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Design Team Selection Phase
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Designer – regular consultant selection process –Qualifications Based Selection (QBS)
General Contractor Options:
• QBS
How is the Team Selected?
• Best Value = Technical evaluation + price
FHWA allows any fair and transparent selection method to be evaluated under SEP-14. Most CMGC projects trend to Best Value.
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Transition to Construction –Negotiation or Bid
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Two possible outcomes of “bid”
Owner gets acceptable price - Proceed with build
Owner doesn’t get acceptable price
k
CMGC/CMAR Bid Process
• Re-Scope, More Design, Risk Apportionment –Rebid
• Convert to Design-Bid-Build
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Better Designs –
Challenging to Quantify – Contractor satisfaction with plans
Reduced Change Orders
What Does an Owner Get From CMGC/CMAR
Faster, more accurate schedules –Exceeded expectations
Lower costs
Savings in design
Savings in constructability and innovation
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Theory Vs. Reality
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Largest volume of highway projects started at one time using CMGC/CMAR
Most accelerated program in the nation to date
Osceola County, FL Case Study
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nation to date
11 major roadways started in 1-year
$350 Million
~11 times the previous productionNarcoossee Rd.
Phase I21
Introduction – Success Story
“Top 25 Newsmakers of 2009…. Veteran Engineer Revives Road Program” 3219
CMAR will not work in cases where:
A. All right-of-way has not been obtained
B. Permits are not in place
C. Utilities are not coordinated
Group Question
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D. Plans are already 100% complete
E. None of the above
F. All of the above
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CMAR will not work in cases where:
A. All right-of-way has not been obtained
B. Permits are not in place
C. Utilities are not coordinated
Group Question
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D. Plans are already 100% complete
E. None of the above
F. All of the above
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CMAR not a viable method for roadway projects
CMAR adds costs
Local contractor perception of being “left-out”
Industry Misnomers
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CMAR process is just “brokering out the work” for a fee
CMAR projects have built-in soft costs
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True Costs
36John Young Parkway Ground Breaking
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County Manager was tasked with $700M Program
Aggressive Impact Fee Ordinance
18 projects behind schedule – various stages of design (need for contractor input)
The Challenge….The Opportunity!
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Required 9 projects under construction in 1st year (need for different procurement process)
Poinciana BoulevardPhase II
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Lack of key Stakeholder buy-in
Right-of-Way acquisition process
The Challenge….The Opportunity!
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Designs were over budget
Required Owner to function as “Project Leader”
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Board had no tolerance for projects taking 5 to 7 years to go to construction
Board had no tolerance for change orders
Board had no tolerance for “out of town” contractors
The Challenge….The Opportunity!
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Board mandated operating budget reductions
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Program SummaryProgram Summary
""A good plan, violently executed now, is better than a A good plan, violently executed now, is better than a perfect plan next week."perfect plan next week."
General George S. Patton
402
Understand and Describe the distinctions between CMGC and CMAR
Learn about the value of having CMGC/CMAR in your “project delivery tool box”
Revisit Learning Outcomes
41
Discover practical “lessons learned” from a successful program
0
International Public Works Congress and Exposition
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Kenneth E. Atkins, [email protected]
Bringing Innovative Solutions to Government
P.O. Box 423487Kissimmee, FL 34742-3487
863.875.5777 • fax 863.875.5778
Gregg A. Hostetler, [email protected]
James C. McMinimee, [email protected]
585 East North Hills DriveSalt Lake City, UT 84103
801.633.6220
JMC Consulting
