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Capital Program Implementation Through Construction Management at Risk Delivery Methods- An Owner’s Perspective The Massachusetts Port Authority (Massport)

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Presentation on theme: "Capital Program Implementation Through Construction Management at Risk Delivery Methods- An Owner’s Perspective The Massachusetts Port Authority (Massport)"— Presentation transcript:

1 Capital Program Implementation Through Construction Management at Risk Delivery Methods- An Owner’s Perspective The Massachusetts Port Authority (Massport) Boston, Massachusetts H. Sleiman, P.E., CCM Director, Capital Programs and Environmental Affairs

2 Definition of Massport Massport is an independent authority governed by a board of directors, appointed by the state’s governor Massport owns and operates – Boston-Logan International Airport – Hanscom Field, Bedford, MA – Worcester Airport – Conley Container Terminal – Black Falcon Cruiseport – Various real estate assets

3 Overview Rolling 5-Year Program Developed through Comprehensive and Coordinated Merit Process to Meet the Authority’s Priorities of: – Safety – Security – Operational Efficiencies – Sustainability – Customer Services Reflects Current Financial Constraints Limits Increases to the Rates and Charges

4 Proposed FY10-14 Capital Program Total Projects Massport Funds: CFC Funds: Private Funds: Contingent On Funding Source (CFS) Projects: Unfunded: FY10-14 379 $737M $271M $46M $431M $585M

5 Spending Distribution By Facility (Does Not Include CFS, Private Capital) FY10-14 4.6% 1.8% 85.6% 7.6% 0.4% Agency-wide Hanscom Field Logan Airport Maritime Worcester Airport $46M $18M $865M $77M $4M

6 By Category

7 Average Annual Number of Construction Awards Average Total Per Year Average Annual Number of Consultant Awards Average Total Per Year Capital Programs Statistics 44 $150 M 41 $48 M

8 Project Delivery Method Traditional Design – Bid – Build PROS Familiarity Owner Friendly Contract Language Price Competition Lowest Initial Cost CONS Contractor Qualifications Adversarial Relationship Claims / Litigation Mentality Quality Additional Oversight Costs Program implementation prior to legislation passed on July 19, 2004, project delivery method was “Design – Bid – Build”

9 Design-Bid-Build Internal Resources Standard Contract Documents Standard Procedures/Guidelines Clear Project Expectations Simple Contract Negotiations Minimal Legal Involvement Minimal Project Controls Simple Accounting Interface M/W/DBE Compliance

10 Project Delivery Method CM at Risk Guaranteed Maximum Price PROS Qualified Contractor Professional Working Relationship Team Collaboration /Realignment During Project Cost, Schedule, Quality Control Experience Pre-Construction Services CONS Lack of Familiarity Develop or Select Contract Documents Additional Procurement Time Higher Initial Bid Price Program implementation post-legislation passed on July 19, 2004, project delivery method was “Design – Bid – Build” Allows CM at Risk for vertical projects valued at $5M or above Allows for Design Build for horizontal projects valued at $5M and above

11 CM at Risk Internal Resources New Contract Documents Increased Contract Negotiations Lack of Standard Procedures Increased Legal Involvement Increased Procurement Involvement/Time Increased Project Controls Support Contingency – Mine or Yours?

12 Change in Implementation Central Garage Addition and Renovations – $200M Value – CM: Turner Construction New Terminal A – $500M Value – CM: Skanska New Prescott Street Pumping Station – $12M Value – CM: O’Connor Terminal B Garage Renovations – $55M Value – CM: Consigli Economy Parking Deck –$17M Value –CM: Turner Construction Consolidated Rental Car Facility (CONRAC) – $250M Value – CM: TBD New Bus Maintenance Facility – $20M Value – CM: TBD Rehabilitation of Aircraft Hangars – $18M Value – CM: TBD Projects Completed or Ongoing Since Legislative Change:

13 CM Selection Process Task 0:Retain a Qualified Designer that has Good Experience in CM at Risk Project Implementation Task 1:Retain a Qualified CM Owner Representative (either from a Consultant/Designer Team or Independent CM) Task 2:Pre-qualify CM at Risk Teams – Experience with similar work – Project team members and management – Safety records including OSHA violations and not just the EMR – Financial stability – Etc. Task 3:Issue RFP to Short-listed CM at Risk Teams – 20% - 30% preliminary design documents – Pre-construction contract form – Master construction agreement form – General provisions – Special provisions

14 RFP Requested Information Technical Proposal – Scope of pre-construction services – Critical path schedule – Assumption and qualifications – Description of technical challenges – Value engineering ideas and schedule enhancements – Routine information: surety letter, prevailing wages, etc.

15 Price Proposal Preconstruction Phase (hours X rate X multiplier) General Condition: (Project Management Staffing) General Requirement: Direct Cost from Document Reproduction, Insurance and Bonds, to Quality Control and Lab Fees, Etc. Construction Contingencies Fee “Good Faith Estimate” (GFE) regarding Construction Cost Project Duration Cash Flow and General Conditions Spending Charts

16 Proposal Evaluation Technical Proposal – Project understanding – Technical challenges and proposed solution – Assumption and qualification – Value engineering ideas – Etc. Price Proposal – Mulitiplier – Personnel – Fee – Breakdown of GFE – Comparison between proposals

17 Case Study – Massport Terminal B Garage CM at Risk Project The Project Involves: Drainage Improvements Structural Strengthening Lighting Replacement Upper and Lower Roadway Replacement Waterproofing Installation of Photovoltaics Expansion Joint Replacement Modernization of Elevator Lobbies

18 Advertised for CM Qualifications Review of Nine Qualification Packages led to Six Companies being Shortlisted Requested Technical Proposals and GFE from Shortlisted Companies Selected Three Firms to be Interviewed based on Proposals and GFE Selected Consigli Construction Company Based on Interviews and Evaluation of Proposals Process

19 Gained Insight to Possible Areas of Conflict within the Project Evaluated Potential Solutions to Identified Conflicts Confirmed Reasonableness of Preliminary Cost Estimates ($52 million) Identified Areas where Additional Field Investigation/Field Mock-up would be Useful Team Approach helped to Minimize Owner Exposure for Unknown Conditions by Establishing Contingency Costs (Signage, Bollard Relocation, Asphalt Escalation) Owner Benefits of CM Selection Process

20 Item #ItemFST/PBSkanskaConsigliSuffolkWalshGilbaneTurner Average CM Value 1 Estimated CM Preconstruction Phase Services Contained in Line Items $127,990$182,080$211,290$373,555$292,460$362,204$258,263 2 Estimated total Cost of Construction Phase not to exceed General Conditions $2,622,681$3,350,506$5,078,320$6,522,845$8,121,735$4,368,775$5,937,778$5,563,327 3 Estimated total cost of construction phase not to exceed General Reqmts $2,185,567$1,473,830$4,274,312$8,135,833$9,160,910$3,588,803$4,284,603$5,153,049 4 Estimated total cost of construction phase Construction Contingency $2,185,567$4,313,167$6,000,000$2,200,000$0$3,000,000$3,246,672$3,126,640 5CM at Risk Fee*$1,311,340$1,357,762$1,880,642$1,636,344$2,919,100$1,789,436$3,034,082$2,102,894 Fee Percentage3.00%2.75%3.75%2.95%5.00%2.75%4.50%3.62% 6 Good Faith Construction Cost Estimate $43,711,347$40,235,654$34,797,826$38,610,600$41,099,358$54,112,808$53,954,998$43,801,874 Duration (months)4640.542414244.53641 Total Cost for Construction $52,016,503$50,730,919$52,031,142$57,105,663$61,301,145$66,859,866$70,458,169$59,747,824 TERMINAL B - CM PHASE II PROPOSALS - CONSTRUCTION COST SUMMARY *Skanska % fee and written in fee differed by approx. $4,000

21 Division No.ItemFST/PBConsigliSuffolkSkanskaWalshTurnerGilbane Average CM Value 2Site Work$4,374,633$5,595,321$3,207,435$4,632,108$1,944,781$5,135,794$16,346,069$6,143,585 3Concrete$28,800,760$15,691,814$24,207,245$20,439,856$25,287,414$25,036,040$17,442,150$21,350,753 4Masonry$232,692$95,000$1,241,360$83,100$402,413$594,280$904,427$553,430 5Metals$382,166$427,511$446,135$1,277,934$787,794$2,780,248$857,163$1,096,131 7 Thermal and Moisture Protection $4,324,188$2,376,487 Covered within another item $5,149,794$5,854,345$5,769,000$6,349,203$5,099,766 8 Doors and Windows $11,000$49,000$14,000$42,600$13,049$70,000$23,382$35,339 9Finishes$172,643$700,000$57,260$372,117$120,791$139,636$288,554$279,726 10Specialties$451,000$425,000$150,000$36,480$132,947$1,200,000$13,997$326,404 13 Special Construction Covered within another item $65,000 Covered within another item $162,000$113,500 15Mechanical$701,467$1,523,461$1,483,310$1,844,075$740,652$1,230,000$1,415,949$1,372,908 16Electrical$4,260,798$7,849,231$7,803,855$6,357,590$5,815,172$12,000,000$10,309,914$8,355,960 Total for Good Faith Construction Cost $43,711,347$34,797,825$38,610,600$40,235,654$41,099,358$53,954,998$54,112,808$43,801,874 TERMINAL B - CM PHASE II PROPOSALS - CONSTRUCTION COST SUMMARY GOOD FAITH CONSTRUCTION COST

22 Through Outreach to Subcontractors, Received Favorable Pricing on Many Items (Electrical, PV, Site Work) Preliminary Demolition of CMU Block Walls allowed Subcontractors to Examine the Physical Conditions Prior to Bidding Mock-up of LED Lighting Units allowed for Full Evaluation of Various Systems prior to Finalizing Specifications Savings on Pricing (approximately $6.5 M) allowed for Flexibility to Double the Number of Solar Trees Successes of CM at Risk for Terminal B Garage Project

23 Items in Second Phase of the Project advanced to the First Phase thereby avoiding Re-work in the Same Area Collaboration between Designer and CM helped to Improve Specifications for Better Scope Definition Between Disciplines Collaborative Approach helped Develop Scheduling, Phasing and Code Solutions that were Responsive to Field Conditions and Owner/Passenger Needs Successes of CM at Risk for Terminal B Garage Project (cont’d)

24 Final Note Train your Internal Staff, Project Managers, in Construction Management and Have them Certified. “C.C.M.”

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