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Alternative Project Delivery Methods October 2014 1.

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Presentation on theme: "Alternative Project Delivery Methods October 2014 1."— Presentation transcript:

1 Alternative Project Delivery Methods October 2014 1

2 Presenters Albert Thomas –American Council of Engineering Companies New Mexico Elias Archuleta –New Mexico Department of Transportation Adam Triolo –Associated Contractors of New Mexico Robert Ortiz –American Council of Engineering Companies New Mexico 2

3 Presentation Outline Introduction & Background –Need to Investigate Alternative Project Delivery Methods –Current Procurement Code & Bidding Strategies –Goals & Objectives Design-Build Method of Project Delivery CMGC Method of Project Delivery Job Order Contracting Method of Project Delivery Next Steps 3

4 Need for Alternative Project Delivery Methods Rising costs of construction Greater public demands Current Procurement Code has limitations Seek opportunities to improve flexibility, cost effectiveness, and speed of delivery KEY: Alternative Project Delivery is not intended to prescribe or mandate a particular method as the norm, but offers additional TOOLS to draw upon for unique circumstances. 4

5 Current New Mexico Procurement Code Limitations Mandates Low Bid Procurement –No flexibility to use other procurement methods –Award to lowest responsive bid –Lowest bid not always Best Value or Highest Quality Specifications –Tend to be Prescriptive-Based vs. Performance-Based Design-Build exempts Highway Construction –Limited experience via Special Legislative Approval CMAR Procurement for Vertical Construction 5

6 NMDOT Current Experience with Bidding Strategies Lowest Responsive Bid –Bid Alternatives; however limited in applying additive or deductive components –A + B (Value + Time) –Lane Rental –Disincentive (Liquidated Damages) –Incentive (contract time) Limited Design-Build –4 Legislative Approved Projects 6

7 Goals for Alternative Delivery Partnership between NMDOT, ACEC NM, and ACNM to develop a proposal that could be legislated to allow for Alternative Project Delivery Methods in New Mexico’s Transportation Industry –Becomes an industry initiative not solely a DOT initiative –Not limited to Design-Build; also includes CMGC and Job Order Contracting (JOC) –Offers alternative strategies to be used, not as the norm, but as available tools for unique circumstances –Educate Industry and Governmental Agencies on use of Alternative Project Delivery Methods 7

8 Design-Build Elias Archuleta NMDOT 8

9 Design-Build DB requires Legislative authority Owner provides Preliminary Design (approx. 30%) Contractor provides final design and construction services. Criteria for use of DB Qualifications-based selection process. Risk transferred from Owner to Contractor – Contractor is responsible for the design of the project as well as the construction. 9

10 Design-Build Two-Step Procurement Process First Step – Submittal of Statements of Qualifications (SOQ) Open to any prospective contractor/design team SOQs are evaluated by the evaluation teams and selection committee Selection committee determines a short list of two to four teams based on the evaluation of the SOQs 10

11 Design-Build Two-Step Procurement Process (continued) Second Step – Request for Proposals (RFP) Short List - Short listed teams are provided with RFP Proposal Development - The DB teams then develop the final design Stipend - A stipend may be provided Evaluation - The proposals are evaluated on qualifications and price separately. Determination - the selection committee makes a determination on a Best Value selection, generally 50% quality and 50% price. 11

12 Design-Build When should Design-Build be used? Projects where the Department can adequately define the project requirements and expectations Projects with time constraints Projects with funding/cost constraints Project constraints conducive to D/B Location / Size / Performance Requirements Projects where the Owner can adequately manage and oversee the project employment of experienced personnel or outside consultants 12

13 Design-Build NM 528 Widening, Rio Rancho 2.3 mile Urban Widening Project with Drainage and Landscaping Improvements Roadway: Widen existing NM 528 to 8 lanes between Coors By-Pass and Sara Rd. and 6 lanes from Sara Rd. to Southern Blvd. Drainage: Construct new 96” storm drain to replace the existing open channel Landscaping (funded by Intel): Enhance landscaping throughout the corridor Project Cost: $21 million Public Private Partnership: NMDOT 50%, City of Rio Rancho 25%, Intel 25% Schedule: Project completed in 10 months Project was completed 2 months ahead of original schedule Design-Build allowed the project to be completed approximately 15 months sooner than traditional Design/Bid/Build Indirect savings to motorists: Over 1 million hours of vehicle delay with an estimated loss of productive time of $12 million 13

14 Design-Build US 70 Hondo Valley 37.5 mile Rural/Small Urban Widening Project with Safety and Access Improvements Roadway: Widen existing US 70 to 4 lanes through the Hondo Valley (Riverside to Ruidoso Downs) Safety: Correct deficient roadway geometry, improve intersections, flatten slopes, install barriers Access: Consolidate driveways and improve sight distance conditions at driveways Project Cost: $130 million Schedule: Although the project was delayed due to lawsuits filed by the Valley Community Preservation Committee, the project progressed well once these issues were settled. Innovations such as Programmatic Agreement with SHPO and a modified ROW acquisition process resulted in an expedited project delivery time. 14

15 Design-Build I-40/Coors Interchange Reconstruction, ABQ 2.0 Miles Urban Interchange with a grade separation of a surface street and pedestrian improvements Roadway: Construct three-level interchange of I-40 & Coors Blvd. with multiple ramps and bridges at I-40 and Coors Grade Separation: Grade separate Coors Blvd. at Ouray Rd. Pedestrian Improvements: Construct two pedestrian bridges Project Cost: $90 million Project Bid for $85 million and delivered for a cost of $90 million due to additions to the project requested by the City and DOT Design-Builder’s bid and ideas to modify the interchange design resulted in a savings of $10 million that would likely have been designed and constructed into a typical Design/Bid/Build (low bid). Schedule: Project completed in 18 months Project completed 1 month ahead of original schedule Indirect savings to motorists: Over 2 million hours of vehicle delay with an estimated loss of productive time of $20 million 15

16 Design-Build New Mexico Rail Runner, Phase II 18-mile Commuter Train Extension Project, Bernalillo to Santa Fe Railway: 18 miles of new rail from bottom of La Bajada Hill to Santa Fe, connecting new rail to existing. Include upgrades to existing track from St. Francis Dr. to the Santa Fe Rail Yard Structural: Construct six new bridges, six load transfer structures, and 1,000 ft. concrete box for rail Project Cost: $128 million Schedule: Project Completed in 16 months On a project of this size, it would normally take about three years to obtain a completed design package that would be ready to be advertised for construction using the Design/Bid/Build process It would have then have taken about two years to construct the project 16

17 Design-Build I-25/Paseo del Norte Interchange Reconstruction Reconstruction of Interchange & Grade Separation of Paseo del Norte Roadway: Reconstruct interchange, construct directional ramp, grade separate Paseo from I-25 to rail spur, partial lyreconstruct ramps at San Antonio and San Mateo Project Cost: $75 million Schedule: Expected Completion, December 2014 Project on Schedule: Design 99% complete, Construction 50% complete Changes to Process Implemented Alternative Technical Concept process during the RFP stage 17

18 Construction Manager General Contractor (CMGC) Adam Triolo ACNM 18

19 What is the delivery method? CMGC Client or Owner Bid / Explain / BuildBid Build ContractorDesigner Phase One: A “Construction Management” consulting contract to help with design. Phase Two: A “General Contracting” contract to build the project. CMGC 19

20 Advantages CMGC Early planning improves ability to resource craft/staff needs Improved cost and schedule performance Risks assigned to party best suited to manage Cost and schedule certainty Transparent estimating process avoids conflicts later Risks identified and mitigation plans prepared early Improved team integration CMGC/CMAR BENEFITS 20

21 Disadvantages Culture – New process for Client/Owner staff (Open Minded Approach) History – Still a new method of procurement for heavy civil highway projects Client – Perception that they are not getting the best price for the work CMGC 21

22 The Procurement Process CMGC RFP / RFQShortlistInterviewSelection 30% Design & Iterative Pricing 60% Design & Iterative Pricing Advance Work Packages PRE-CONSTRUCTION NEGOTIATION LOI 90% Design & GMP GMP – Contract Negotiations Typical Timeline Representation 22

23 Risk CMGC Contractors Client/Owners DBBCMGCDB RISK 23

24 When should this delivery method be used? Projects with Time or Funding contraints Many stakeholders involved Project or design has unique construction elements Help with phasing, defined schedule, and construction process Public impact and safety CMGC 24

25 CDOT Example Opportunity and Obstacles /Project Risk Assessment Discussion Checklists Delivery schedule Project complexity and innovation Level of design Cost Site conditions and investigations Utilities Drainage/water quality Environmental Staff experience/availability Level of oversight and control Competition and Contractor experience CMGC 25

26 Other States – Outcomes Other states’ DOTs adopting and adapting Finding successes with procurement model CMGC StateProjectShortlistSelf Preform % Proposal% PriceInterview % AZSky HarborYES45%100%0%100% FLOrlando IntermodalYESDefined by CMGC/CMAR100%0%Plus/Minus UTSR-14NO50%70%30%Optional NVMcCarronYES25%100%20%80% WASound TransitNO30%60%20% AKTanana BridgeNO70%85%15%N/A COI-70 and PecosNO70%60%20% WATriMetNODefined by CMGC/CMAR70%30%Plus/Minus TXTex RailYESDefined by CMGC/CMAR75%25%N/A 26

27 Job Order Contracting (JOC) Robert Ortiz ACEC NM 27

28 What is Job Order Contracting Alternative to the traditional DBB method of project delivery Best Value Quality Based Selection Process Indefinite Delivery/Indefinite Quantity Contract –One or more offerors –One year or multiple years Job Orders issued on On-Call, As-Needed basis Alternative Procurement Method to get small, routine, and commonly encountered construction projects under contract easily and quickly Close Owner/JOC Contractor working relationship Innovation Timely project completion Job Order Contracting 28

29 What is Job Order Contracting (continued) IDIQ Contract (Base Contract) General Scope of Services with minimum dollar amount Includes a Unit Price Book of Items priced by Owner Contractor submits a Price Coefficient (multiplier) Contracts can include multiple Price Coefficients Work within a District Work within a County Rural/Urban Locations Work during normal working hours/night work Owner Issue Job Orders Construction, Design, PreConstruction Services Job Orders – initiates the work on an On-Call basis Job Order Contracting 29

30 Why Use Job Order Contracting? Saves Time - JOC enables Owners to initiate and complete routine construction projects quickly by eliminating the time to bid each project Decreases project duration and cost Potential to Increase Quality QBS Selection Process JOC Contractor/Owner relationship developed Better use of Owner resources in procuring services Job Order Contracting 30

31 Contractual Relationship Job Order Contracting Job Order Contract Job Orders Owner JOC Contractor Construction, Design, Pre-Construction Services JOC Contractor Construction, Design, Pre-Construction Services JOC Contractor Designer Develops Job Order Contract In-house/Consultant Designer Develops Job Order Contract In-house/Consultant 31

32 When is JOC Used Owner’s needs include Repetitive and routine jobs and situations Small, routine, and commonly encountered construction processes Projects requiring minimal design effort Projects with a minimal risk of unknowns Examples of Highway Construction Projects Minor Construction, Mill and Inlay Projects, Bridge Rehab Projects, Bridge Deck Overlays, Pavement Preservation Projects, Highway Maintenance Projects These types of projects can be done quickly and easily Best suited for routine work with well-defined work items and governing standard specifications Job Order Contracting 32

33 JOC Procurement Process – Two Phase Process Selection Team Appointed Phase 1 – Request for Qualifications (RFQ) Qualifications-Based Selection Process Offeror must self-perform 50% at minimum Evaluate RFQ’s and compile Short List Phase 2 – Request for Proposals (RFP) and Interviews Evaluate RFP’s – Best Value (Quality and Price) Conduct Interviews Score and Rank Recommend Award Job Order Contracting 33

34 Procurement Process Job Order Contracting Need Identified Scope, Location, Quality & Design Criteria Need Identified Scope, Location, Quality & Design Criteria Selection Committee Define Selection Criteria Selection Committee Define Selection Criteria Job Orders Issued On-Call, As-Needed Basis Job Orders Issued On-Call, As-Needed Basis RFQ Quality Based RFQ Quality Based RFQ Evaluation & Short List RFP Best Value Selection Quality and Cost RFP Best Value Selection Quality and Cost Interview and Rank Selection and Award Single or Multiple Selection and Award Single or Multiple 34

35 Advantages Reduces Project Delivery Time Quality of work equal to or higher than traditional procurement methods Qualifications-based selection process, not low bid Long-term relationship established between Owner and Contractor Job Orders can be issued quickly Construction starts quickly; within 20 CD of need Saves time and money in procurement process Minimizes staff and resources required to procure construction services on a project by project basis Contractor can provide design services and other pre- construction services as provided in contract Job Order Contracting 35

36 Disadvantages Not conducive to large, detailed projects Method does not accommodate work outside of original scope well Culture Shift – New process for NMDOT and Contractors Job Order Contracting 36

37 Is JOC Being Used Now Used extensively for water, wastewater, building, and site maintenance work Pennsylvania Turnpike and Arizona DOT Pavement preventative maintenance projects Bridge deck overlay projects New Mexico – uses a form of JOC Price Agreements in Hwy Maintenance JOC allows for design or pre-construction services in support of routine projects Job Order Contracting 37

38 Closing Remarks/Next Steps Task Force (ACNM/ACEC/NMDOT) –Continue to work on and refine Alternative Project Delivery Information –Educational Program Host Alternative Project Delivery Symposium –Involve affected Industry Groups & Stakeholders Continue New Mexico Outreach – Regionally Draft Legislation Language KEY: Alternative Project Delivery is not intended to prescribe or mandate a particular method as the norm, but offers additional tools to draw upon for unique circumstances. 38

39 Closing Remarks/Next Steps 39

40 Thank You Questions? 40

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