CFAC Review

1. CFAC Review Marty Fallier NSLS-IIConventional Facilities CFAC Cost Review May 9, 2007

2. Outline • Recap of CDR Cost Estimate • Cost Estimate Methods • Construction Cost Escalation • Parametric Comparisons • Estimate Summary • Planning for Title –I /CD-2 estimate • Changes since CDR

3. CDR Cost Estimate Sources Note: WBS for CF is now 1.5

4. CDR Estimate Sources • Engineering Estimates (WBS 1.6.1, .2, .4, .5, .6 & 1.6.3.1, .8) • Prepared by BNL based on level of effort, engineering judgment, vendor quotes or parametric comparisons • Include staff labor hours, FTE’s, BNL resource labor (ie. PE) and material & travel expenses • Labor rates applied by labor categories in cost database • Burden and escalation applied in cost database

5. CDR Estimate Sources cont’d • LIRO/HDR (WBS 1.6.3.2, .3, .4, .5, .6, .9) • LIRO/HDR are the A/E team preparing conceptual design for NSLS II CF • LIRO and VJ Associates prepared the estimates • LIRO is an Architectural/Civil /CM firm with extensive NY/LI estimating, construction and CM experience • Uses Timberline with RS Means unit costs and local adjustments • VJ is an estimating firm with extensive experience in the NY/LI construction market • They provided very accurate re-estimating support for the CFN Re-bid • Use their own Database built on experience in the NY/LI area • General Construction estimates are prepared by LIRO • MEP estimates are prepared by VJ

6. CDR Estimate Sources cont’d • Giffels CHW Study (WBS 1.6.3.7) • Chilled water alternatives evaluation prepared by Giffels Engineers inc. • Designed CHW Storage Upgrade to CCWF • Prepared CDR for CCWF Plant Expansion in 2001 • Updated labor and material costs to current rates • Includes detailed qty take-offs for planned expansion of CCWF • Includes CHW piping costs to NSLS II site • Cost Sharing w/BNL • Costs for CCWF expansion split with BNL • 2 Chillers for NSLS II; 1 Chiller for BNL; 1 spare bay for BNL

7. CDR Estimate Methods • Major construction items - WBS 1.6.3 • Estimates primarily based on material quantity take-offs from the conceptual drawings • Some systems that are not yet detailed are based on system cost/SF (mainly in MEP estimates) • Estimators used their own cost estimate systems developed to reflect cost of construction in the NY/LI area (this is their livelihood) • Reflects recent price experience on critical commodities like concrete, steel, copper etc. • Base cost is subcontractor cost plus GC OH&P • 15% General Conditions is added to account for bonds, insurance, supervision, safety, mobilization, site maintenance etc.

8. CDR Estimate Methods cont’d • Major construction items - WBS 1.6.3 • Estimates primarily based on material quantity take-offs from the conceptual drawings • Some systems that are not yet detailed are based on system cost/SF (mainly in MEP estimates) • Estimators used their own cost database developed to reflect cost of construction in the NY/LI area (this is their livelihood) • Reflects recent price experience on critical commodities like concrete, steel, copper etc. • Base cost is subcontractor cost plus GC OH&P • 15% General Conditions is added to account for bonds, insurance, supervision, safety, mobilization, site maintenance etc.

9. CDR Construction Escalation • The majority of construction costs are labor, not material • While some material prices have been volatile, labor prices have been steady in most markets, including NY/LI • While there was a sharp increase in construction costs in 2005, the market has adjusted in 2006 • ENR NY construction cost increase for 06 is 3.6% • ENR NY building cost increase for 2006 is 4.0% • ENR NY labor cost increase for 2006 is 3.1% • ENR NY material cost increase for 2006 is 6.9% • So despite material cost increase of 6.9% actual construction /building cost is much closer to the labor cost increase

10. CDR Construction Escalation cont’d • Looking ahead – NY vs LI markets • NY has a number of large projects in the planning stage in addition to the Freedom Tower project just getting underway • Projects in planning stage historically have several years before all approvals and financing are in place, if they happen at all. • By contrast, LI has one major project (development of the Nassau Coliseum area) in planning stage and this is likely to go to a commercial developer. • In sum, NY City may have a tight market but LI will likely be competitive (downward price pressure). • Major LI Contractor using 5% for construction escalation • Given local ENR data (~3.7%) and local contractor practice, escalation of 5% is prudent at this time.

11. CDR Construction Cost Comparison Costs include building construction and related sitework and utilities. NSLS II in upper range of data except compared to CFN due to substantial difference in CFN building type 1 - Based on cost at completion, not bid cost

12. CDR Construction Cost Comparison Costs escalated to FY06 $ • Costs include sitework and utilities

13. CDR Conventional FacilitiesTotal Estimated Cost ($ x 1000) WBS Dictionary: All phases of design, construction, and commissioning of the conventional facilities.

14. Conventional Facilities Construction Total Estimated Cost ($ x 1000) WBS Dictionary: Construction of all NSLS-II buildings, utilities and improvements to land. Note: WBS for CF is now 1.5

15. CDR Cost Estimate Summary • Largest Cost areas for CF (WBS 1.6.3) have relatively detailed estimates for conceptual design. • Significant value engineering has already taken place and is identified in the add/deduct alternate estimates • Estimates used recognized methods, rates are updated frequently and include adjustment for local conditions or unique work • Escalation of 5% balances recognition of material cost volatility with relatively stable labor rates • Exceeds ENR of 3.7 – 4.0 % • Matches the value used by local contractor 5% • Comparison with other construction indicates estimate is on par or slightly conservative

16. Changes to Estimate Since CDR Direct FY06$ With Burden & Escalation CF Total is ~$ 220M

17. Changes since CDR Cost Estimate • 1.5.3.3 BLOC –$6.5M direct FY06$ decrease • Added cost for Compact Booster – detailed take-off • Deleted CLOB and replaced with Operations Center – SF estimate • 1.5.3.4 Ring Bldg - $1.0M direct FY06$ decrease • Revised shield wall cost by reducing HD concrete - unit cost/cu. yd. • Added 60 ratchet wall shield doors – vendor quote unit cost • 1.5.3.5 Lab Office Bldgs - $15.6M direct FY06 increase • Increased # and size of LOB’s – SF estimate

18. Contingency & Scope Contingency • Contingency Estimates will be based on next update of Risk Analysis • CDR Calculated was 31% but applied Mgt. allowance of 35% • Current Mgt allowance is ~40% • Scope contingency is primarily limited to LOB’s and Ratchet Wall Doors – all other scope is essential to operation • 3 LOB’s @ $6.3M direct ea. = $18.9M ($31.5 TPC) • 60 ratchet Wall Doors @ $40k direct ea. = $2.4 M ($4.0 TPC) • Total Scope Contingency = $21.3 M ($35.5 TPC)

19. Estimate Changes Needed for CD-2 • Must capture modest changes to scope dependent level of effort activities • Need to increase design costs (1.5.2) and CM costs (1.5.3.1) to reflect increased scope for Booster and LOB’s • BLOC (1.5.3.3) reflects estimate for Compact Booster • Need to differentiate Booster, Linac and Ops Ctr costs • LINAC costs are currently in Ring Bldg (1.5.3.4) and need to be moved into BLOC • For LOB’s (1.5.3.5) - Should resolve what level of development of lab/office program will be in base scope • Could be full build-out of space or just shelled space for future beamline programs

20. Estimate Changes Needed for CD-2 cont’d • Need fully developed take-off & vendor quote based estimate • Updated escalation analysis based on local factors and trend analysis • Updated and more detailed risk analysis with Monte Carlo simulation for contingency development • Application of value management and alternatives cost analysis (Value Engineering Report) and incorporation of selected alternatives • Time phased estimate based resource loaded schedule with escalation to at-year $.