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What is Design Build?

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  1. What is Design Build? Design-Build is a method of project delivery in which one entity (the design-builder) forges a single contract with the project owner to provide both architectural, engineering design services and construction services. Source: Design-Build Institute of America

  2. WELCOME TO DESIGN BUILD MIRACLE NIGHTMARE?

  3. Design Build Panel • Wayne Larsen – Parsons Brinkerhoff • Tom Loo – Alberta Transportation • Karen Stein – Utah Department of Trans. • ROUND TABLE DISCUSSION

  4. U.S. R/W Perspective Ms. Karen Stein, SR/WA, R/W-RAC Deputy Director for the Utah Department of Transportation

  5. Traditional Design Bid Build Plan UDOT Staff or Consultant Design UDOT Staff or Consultant Clear ROW UDOT Staff or Consultant Build UDOT Staff or Consultant

  6. Design Build Plan + 30% Design UDOT Staff or Consultant Design Design Build Consultant Team Clear ROW Design Build Consultant Team Build Design Build Consultant Team

  7. When is Design Build a good idea? • Projects where in-house resources are not sufficient • Projects that can benefit from fast-tracking • Projects with a high need for innovation • Projects on an Interstate • Risks known and transferable

  8. With Design Bid Build(the traditional model) In DBB projects there is a balance between • Scope • Schedule • Budget

  9. With Design Build • It is all about the Schedule!

  10. Design Build from the U.S. Agency’s perspective Benefits • Identify and manage risk • Reduce acquisition time line • Encourage negotiated settlements • Encourage design to mitigate “damages” • Encourages use of effective scheduling methods and software • Expands DOT resources for Acquisition/Relocation Process • DB incentives help promote implementation of an effective Public involvement plan

  11. Design Build from the ROW perspective Risks • Increased overhead and direct acquisition and relocation costs • Potential for coercive acquisition methods • Increased number of condemnation cases & admin settlements • Potential for precedent setting practices which are out of compliance with URA and or UDOT ROW Policies and Procedures. • Increased time for each ROW task due to increased hand offs between DB and Central DOT ROW • Delay Claims if DOT fails to meet schedule requirements

  12. Issues for ROW with Design Build The Selection Process • Right of Way section of RFP must be sufficiently and accurately detailed • Selection Team must include a ROW Staff person • ROW component of the DB Proposals may not be sufficient to affect the overall selection of the DB team.

  13. Benefits Early known cost Reduce delivery time Reduce design errors Improve Constructability Identify and manage risk Encourage innovation Less detail required in design Expands UDOT resources Risks Proposal costs Innovation limited to contractor experience Third Party Delay Design Build from the Engineering point of view

  14. Canadian Perspective Mr. Tom Loo, P. E. Executive Director of Major Capital Projects for Alberta Transportation

  15. Ring Roads • The Premier and the Government of Alberta have made a commitment to complete the ring roads in a free flow condition around the cities of Edmonton and Calgary • The majority of the land required for these major freeways were purchased by the province in the 1970’s

  16. Current Status of Ring Roads • Segments of Anthony Henday Drive in Edmonton and Stoney Trail in Calgary are currently open to traffic • Planning, design, and construction is continuing on all remaining segments of the ring roads

  17. Edmonton Ring Road

  18. Calgary Ring Road

  19. Project Delivery Mechanisms • Traditional Design-Bid-Build • Projects up to approximately $100 million • Majority of projects delivered using this method • Design/Build • Projects approximately $100 to $300 million • One project being delivered using this method • Public Private Partnerships (P3) under a Design/Build/Finance/Operate (DBFO) agreement • Projects approximately over $300 million • Two projects designed, constructed and currently in operations • Two other projects being delivered using this method

  20. Anthony Henday Drive – Stony Plain Road Interchange • Being delivered through Alberta Transportation’s first design/build contract • Includes 50 lane km of new and rehabilitated roadway and seven bridge structures which will provide for a free flow systems interchange

  21. Anthony Henday Drive – Stony Plain Road Interchange

  22. Anthony Henday Drive – Stony Plain Road Interchange • Design/Build Procurement commenced in summer 2008 • Issued RFQ in August 2008 • Short-listed to three proponents • Issued RFP September 2008 • Executed agreement with preferred proponent February 2009 • Contract price of $168.6 million • Construction commenced April 2009 • Traffic availability scheduled for October 15, 2011

  23. Design/Build Advantages • Cost certainty • Schedule certainty • Compressed schedule (fast-track design and construction) • Clearly defined project scope • Risk transfer • Opportunity for innovation

  24. Design/Build Disadvantages • Clearly defined project scope • Design must be further advanced for accurate pricing • Unknowns removed (geotechnical, etc.) • Regulatory issues resolved in advance (risk not transferred) • Less “control” by owner during design and construction

  25. Design/Build Disadvantages • Clearly defined project scope • Design must be further advanced for accurate pricing • Unknowns removed (geotechnical, etc.) • Regulatory issues resolved in advance (risk not transferred) • Less “control” by owner during design and construction

  26. Design/Build Disadvantages • Potential for quality issues • Costly procurement process • Not ideal for projects with: • Geotechnical unknowns • Environmental issues • Utility issues • Any 3rd party which may add risk to contractor

  27. Design/Build Procurement Process • Detailed Technical Requirements • Pass/Fail criteria for technical submissions by proponents • Allow multiple runs at the gate to achieve pass within a set time period • Must be compliant technical proposal (pass) to proceed to price submission • Lowest price wins

  28. Quality Management • Quality is very important to the owner • Quality Manager required and evaluated as part of RFQ • Quality Management System must be ISO compliant • Contractor responsible for overall Quality Control and Quality Assurance • Owner has maintained rigorous quality management oversight

  29. Elements of Design/Build • Utility cost sharing threshold • Progress payments during construction • 10% holdback • Late completion penalty of $10,000 per day • 2-year warranty

  30. Land Acquisition • Owner best party to manage the risk of property acquisition • In general, risks not properly allocated or mitigated will ultimately be transferred back to the owner through the bid price • Ideally, all required land should be acquired prior to the start of the procurement process • Majority of required land purchased by the provincein the 1970’s

  31. Land Acquisition • Some slivers or small parcels required for design and construction • Private contractors do not have the ability to expropriate property if required • Property acquisition can be a lengthy process and negate the advanced schedule benefits of Design/Build

  32. Land Acquisition • Where the required sliver or parcel of land was not obtained prior to procurement, Design/Build agreement specifies when the required land will be available • Provincial staff continued to work during procurement period and early construction period to secure required land • Contractor required to mitigate impacts of not having required land at start of construction • Process has worked reasonably well

  33. Current Status of Design/Build Project • Ahead of schedule • On budget • Good quality • Good working relationship with contractor

  34. DB Consultant Perspective C. Wayne Larsen, SR/WA, R/W-AC

  35. FORBES RatesBest & Worst Cities for Commuters • Forbes ranked Salt Lake City the best city in the country for commuters (FEB 16, 2010) • "One of the reasons we are ranked so high by Forbes is because we have such a comprehensive transportation system." • "One of the biggest, most aggressive, and most successful rail expansion program in the country right now,"

  36. UTA – FRONTLINES 2015 PROGRAM FRONTRUNNER CRS MID-JORDAN LRT DRAPER LRT WEST VALLEY LRT AIRPORT LRT

  37. UTA – FRONTLINES 2015 PROGRAM • 70 Miles in 7 Years (2015) • Using a Design Build team approach • 70 Miles in 5 Years (2013)

  38. The Most Important Lessons Learned by UDOT ROW • The RFP is your controlling document • Write and re-write the RFP to make sure all expectations are clearly written • A commitment to oversight is required by the DOT Don’t underestimate the amount of time and number of resources this will require • Hold the DB accountable, be assured that the DB will hold the DOT accountable • Manage Risk wisely and make the DB retain the responsibility of clearing ROW after the NTP date as stipulated in the RFP

  39. Additional Lessons Learned • Monitor the QC/QA process to make sure it is adequate and effective • Have a strong Public Information component of the DB team • Make sure the DB carefully plans and conducts effective Community and Neighborhood focus meetings • Identify and work with 3rd party stakeholders early in the process • Include utility, outdoor advertizing signs, rail roads, local agency and or 3rd party agreements in the environmental document if possible. • If, not in the environmental agreement, develop utility, local agency and or 3rd party agreements as early as possible

  40. DESIGN BUILD ROUND TABLE DISCUSSION

  41. Thank you • kstein@utah.gov (801) 965-4057 • Tom.Loo@gov.ab.ca (780) 913-0330 • Larsen@pbworld.com (801) 550-9259

  42. History of DB with ROW in Utah I-15 (prior to 2002 Olympics) Reconstruction • UDOT cleared ROW for Residential properties, DB team cleared ROW for Non-Residential properties • Under traditional DBB- 8 years estimated time to complete the construction • Actual under DB – completed in 4 years

  43. Current DB ROW Projects • Pioneer Crossing * (I-15 Interchange) (Region 3) • I-15 Core * (Region 3) • SR-68; Bangerter to Saratoga Springs (Region 3) • 114th South (I-15 Interchange) (Region 2) • Fort Lane Interchange (I-15 in Region 1) • 6200 South CFI (SR-68) (Region 2) See UDOT’s website for interactive video of these highly innovative projects: www.udot.utah.gov (Under public/innovations)

  44. Projects with specific innovative components • Pioneer Crossing -- Diverging Diamond Interchange (DDI) and Accelerated Bridge Construction (ABC) • S.R. 92 -- Commuter Lanes • Express Lanes--I-15 Core • Continuous Flow Interchange (CFI) SR-68 Details about each project can be found on the Udot website under public info/innovations and or under Projects. Home page is www.udot.utah.gov Video overview of UDOT’s program with emphasis on innovations is available on this website:

  45. RFP must describe the specific Scope of Work • Prepare list of parcels with high priority • Determine clear scope of work for the ROW Design • Prioritize 3rd party entities and all utilities • Provide the DB with a list of properties already acquired or which will be acquired by the DOT • Determine whether the DB will be responsible for the Closings and if so, will they provide Title Insurance • Detail who will have signature authority for every step of the process • Just Compensation • Pre-Approval of Admin. Settlement amounts • Contracts and or Settlement Authority for Mediations, Arbitrations and Condemnations. • Relocation Claims • Develop a negotiated Flow Chart with the DB • Meet and discuss status on a weekly basis • Track all hand offs to and from the agency (using a shared system if available) IE using our in house EPM system, or the DB’s tracking system. Agree on the method to be used to track the process, status and deliverable

  46. Best Practice RE: Scope of Work Based on UDOT DB Projects • DOT should begin early acquisition process (total acquisitions & complex acquisitions or 3rd party involvement)) as soon as possible once the project has Environmental Clearance • Purchase based on 30% design for the widest estimated footprint to include all potential easements • Transfer the responsibility of clearing ROW and the Risk as of the Notice to Proceed (NTP) Date.

  47. Appraisal/Valuation Issues • Consistency in methodology and use of comparable sales data • Out of state appraisers and review appraisers are not recommended, out of necessity out of state reviewer may be ok but not ideal. • Single review appraiser or at least one reviewer per identified segment of the project for consistency purposes

  48. Acquisition Issues • Monitor to ensure that policies and RFP are followed • Require good faith negotiations • Do not allow DB to use Right of Entry (ROE) unless other means to acquire have been exhausted • Use Right of Occupancy Agreement (ROO) responsibly and only if owner is willing to negotiate and or mediate differences of value • If ROO is obtained DB must follow up to acquire or condemn based on negotiated time line (negotiated with property owner) with authorization of the DOT • Condemnation Resolutions prepared timely • Condemnations may only be withdrawn by the Director of ROW

  49. Relocation Issues • Ensure that proper notices are prepared and issued • Ensure that advisory assistance is appropriate and timely given • Make sure that DOT pre-authorizes studies and notices of eligibility before DB issues them • DB to keep log current and available to the DOT after each contact with property owner or displaced person • Sky is not the limit for relocations! • Rush to clear should not result in super adequate and or inappropriate relocation benefits offered • DB must insure that agents employed on the DB project meet or exceed minimum qualifications as if they were working directly for the DOT • Agents employed by the DB must be familiar with the subject area to ensure that what is thought to be comparable for replacement property is in fact comparable • Agents employed by the DB must remember that they are the face of the DOT and must conduct themselves accordingly

  50. Property Management Issues • Salvage rights • Lease agreements • Terms of assumed leases • Walk through and release of security or key deposits • Security issues • Demolitions • Surplus Property • Staging Areas