1. Tulsa DISTRICT Engineering & Construction (E&C) Cost Perspectives 19 March 2019
Shawn Painter, P.E. Chief, Engineering Branch Tulsa District, USACE

2. E&C Cost Perspectives Mission Areas Overview Programming Design
Recommendations
Conclusion
E&C Hydropower Implementation

3. Mission Areas Overview
USACE Mission is diversified and Tulsa District has nearly every mission.
Planning
Regulatory
Recreation
Dam and Levee Program (Flood Risk Management)
Emergency Management
Civil Works Operations & Maintenance
Hydropower
Navigation
Interagency Support
Military Construction
Military Sustainment, Restoration, and Modernization (SRM)
Environmental
Real Estate
File Name

4. Mission Areas Overview
USACE Mission is diversified and Tulsa District has nearly every mission.
Planning
Regulatory
Recreation
Dam and Levee Program (Flood Risk Management)
Emergency Management
Civil Works Operations & Maintenance
Hydropower
Navigation
Interagency Support
Military Construction
Military Sustainment, Restoration, and Modernization (SRM)
Environmental
Real Estate
File Name

5. Mission Areas Overview
USACE Mission is diversified and Tulsa District has nearly every mission.
Planning
Regulatory
Recreation
Dam and Levee Program (Flood Risk Management)
Emergency Management
Civil Works Operations & Maintenance
Hydropower
Navigation
Interagency Support
Military Construction
Military Sustainment, Restoration, and Modernization (SRM)
Environmental
Real Estate
File Name

6. Military & IIS Mission Engineering Construction Installation Support
Vance AFB
Pantex
Tinker AFB
Altus AFB
McAlester
Fort Sill
Sheppard AFB

7. Cost and the Mission DoD (and Industry Partners by Extension) Are:
Stewards of Taxpayers Dollars
Risk Informed Decision Makers
Process Improvers
Partners in Success/Failure
Supporting our Nation with Critical Infrastructure
Cost Issues Can Impact All Phases of Project Development
Planning & Programming
Design
Construction
Operations & Maintenance

8. Planning & Programming
Steps in the MILCON Budget Process:
Identification of the Project Need & Constraints (NEPA, Siting, Alternatives, Scope, etc.)
Project Initiation – Requirements Documentation/Project Definition
Identify Execution Method (D/B, DBB, etc.)
Budgetary Cost Development
Submit Package for Funding Authorization from Billpayer (Congress, CF Hydropower, etc.)
Design, Construction, O&M/SRM, Disposal
MILCON Programming
Programming is the process of developing and obtaining approval and funding for Military Construction (MILCON) projects (AFI )
Planning Charrette to Develop the DD1391 Form at Installation for Agency & Congressional Approval.
5 Year process for MILCON projects (minimum)

9. DD 1391 Example
CCL PA

10. Example Timeline for MILCON projects

11. Programmatic Discussion Items
Incorporation of Risk When Developing the DD1391?
Price of working inside the fence vs. outside (Area Cost Factors accurate?)
Price of government process and controls vs. private industry
Market conditions, worker availability, material cost fluctuations (forecasting contractor risk?)
Acquisition approach
Unforeseen conditions
Lost design/Scope Reduction/User Requested Changes
Incorporate Lessons Learned
Due diligence during PDR/CDR
Understanding Program Estimate Limitations ($/SF)
Cost is not definitized by actual scope and design of this specific project
Standard designs can help, but there are local conditions that may not be included (safe rooms, SSMR, foundations, sustainability measures, etc.).
Unique facilities that don’t fit in the typical cost/SF
Economy of scale impacts
Material selection
Type of building construction
Sustainability
Utility requirements

12. Design Discussion Items
Cost Accuracy Improves During Design
Develop the Independent Government Estimate (IGE)
Iterative Design Process Sharpens IGE Accuracy with Time
Value Engineering
Risk Identification (*Not All)
Design Cost Drivers
Change in Criteria/Codes
Quality Management Performance
Sustainable Features
Site Issues (Drainage, AT/FP, etc.)
Construction Material Selection (ICF, PEMB, CMU, tilt-up, etc.)
Architectural Compatibility
Foundation Type
Utility Uncertainties
PDR/CDR Omissions
Real Property Installed Equipment
MILCON & SRM Extents (Colors of Money)
Biddability & Constructability of Design

13. Cost Concerns - MILCON Don’t Push Design Problems to Construction
Ability to timely impact change is LOW
Cost to impact change is HIGH
Ambiguity/Conflicts Create Disputes Between Gov/Ktr (REAs/Claims)
Partnership Suffers
Quality Design = Better Cost Control
Don’t Delay
Reprogramming Can Take 6-8 Months
Identify Potential Design Issues Immediately (Ktr  Area OfficesDOR)
Design Corrections During Construction Impact Schedule and Cost
Re-work Costs Everyone

14. Recommendations Programming Phase Design Pre-Award Phase
Develop Risk Matrix During PDR/CDR (Gov & Ktr Risks)
Cost-Schedule-Risk-Analysis (CSRA) Approach during DD1391 Development
Independent Development of DD1391 Costs with Peer Review/Validation
Inclusion of Lessons Learned During PDR/CDR (Correct People on the Bus)
Program to Minimum Facility Requirement AND Add 5-10% in User Options
Installation/Owning Agency Consider What Is Minimally Acceptable
Installations consider SRM funded Investigations/Survey/Site Assessment Prior to PDR/CDR
DoD Consider Funding DDC Via Discretionary Pot vs. Project Funds (DDC Is Deducted from Contingency)
Design Pre-Award Phase
Design to 95% of CCL (Sacrifice Options if Needed)
Enforce Independent Government Estimate with Peer Review/Validation
Insure Proper Design Quality Management
Upward Report Cost Concerns During Design Immediately
Incorporate Ktr Risk Reduction Measures
Contractor Involvement in Common Construction Problems (e.g. MATOC Pool Queries/Surveys)
Value Engineering
Partner on Cost Concerns
Ktr’s Provide Cost Reduction Recommendations During Bidder Inquiry
Ktr’s Provide Feedback to KO After Pre-bid Site Visits

15. Questions?

16. Backup Slides

17. References
ICEAA Link: Construction-Cost-Estimating.pdf Whole Building Design Guide:

18. Programmatic Concerns
Costs Concerns
After Congressional authorization, the funding available for construction is locked at the PA and includes a standard 5% contingency. (reprogramming above the 5% is authorized at Agency level up to $2M or 20% - whichever is less, otherwise Congress has to reauthorize)
Construction cost estimate in the DD1391 Block 9 is derived using historic SqFt estimates for facility type for the services nationwide. Not definitized cost estimates.
Facilities have unique local requirements (SafeRooms, SSMRs, foundations, sustainability,etc) that can be cost increasers compared to national averages.
Economy of scale can be advantage/disadvantage
Area Cost Factors (ACF) are used to adjust for perceived local market rates and can be incorrect (local industry interest, access requirements, etc)
Programmatic cost estimates are not “real time” inclusive of market trends (steel tariffs, labor availability, material shortages, etc). Cost books can capture project costs well beyond the last 2 years.
Acquisition requirements are not fully established at DD1391 development. (i.e. will project be split into multiple acquisitions)
Rolling risk into the DD1391 is very challenging as the process doesn’t lend itself to cost risk outside the standard 5%.
Installations/commands are competing for a line in the agency budget submission. So, too much cost can put the project at risk.
Programming charrettes can be performed more than 5 years out of the program year and local conditions may change the associated project scope & risks.