cm at risk delivery - western council of...

CM at Risk Delivery

Moderator: Ken Harms

Gilbane Building Company

Panelists:James Sowerbrower

California State University

Robert Uvalle, CCMAdministrative Office of the Courts

Jim MuellerKMD Architects

Rick MillitelloSkanska USA

Panel IntroductionsKEN HARMS, Vice President and Regional Manager of Business Dev.GILBANE BUILDING COMPANY

Gilbane is a family run firm providing a full range of construction services. Gilbane is currently ranked 5th on the ENR cm at risk list. Ken has been instrumental in the expansion of cm at risk for public owners throughout the west. Ken worked on the legislation that created alternative delivery methods in Arizona; provided training to numerous school districts throughout California on CM at Risk; participated in the first CMAR project for the CSU system; and consulted with AOC on the development of their standard at risk contract. He currently serves as PIC on the Madera and Banning Courthouses cm at risk projects.

Panel IntroductionsJAMES SOWERBROWER, Chief of Construction ManagementCALIFORNIA STATE UNIVERSITY

James Sowerbrower is the Chief of Construction Management of the California State University (CSU). In this position, he oversees construction management on all CSU campuses and is responsible for system-wide construction management policies and procedures. James has nearly forty years of experience in the construction industry, including his service as Senior Vice President for Contractors Management Corporation and Senior Capital Projects Manager for the County of San Mateo. He holds a Masters Degree in Architecture from CSU, San Luis Obispo and an undergraduate degree in Engineering from the New Jersey Institute of Technology.

Panel IntroductionsROBERT UVALLE, CCM, Manager of the Design and Construction UnitOCCM

Robert M. Uvalle is the Manager of the Design and Construction Unit -North Central Region for the Administrative Office of the Courts. Located in Sacramento, his team holds project responsibilities for 16 Capital Construction Projects with a total value of $1.75 billion and also supports the ongoing Facility Modification program of existing Court buildings. Rob has been with the (AOC) since March 2005, he holds a bachelor’s degree in Construction Management and a bachelor’s degree in Communications; he has worked in the construction project management profession for over 23 years with wide range of Program and Project Management experience. He began his career working for Perini International – Western region, a nationally recognized builder of large construction projects such as the Moscone Center in San Francisco.

Panel IntroductionsJIM MUELLER, Principal / Executive Director of KMD Justice KMD ARCHITECTS

Jim is a Principal and Chairman of the Board for KMD. Since 1990, he has served in the role of Executive Director of KMD Justice, a subdivision of KMD whose staff devote the entirety of their professional attentions exclusively to the planning, design, and construction of criminal justice building types. In his capacity, Jim has overseen the professional services on over 350 justice related projects which have included detention, corrections and courts facilities for both juvenile and adult/male and female populations, law enforcement facilities, forensic facilities, coroner facilities, and secured healthcare/mental health/special needs facilities.

Panel IntroductionsRICK MILLITELLO, Executive Vice PresidentSKANSKA USA

Rick is a 31 year industry veteran experienced in Construction Management at Risk contracts having engaged with entities including Genentech, HCA, Johnson & Johnson, Kaiser, and Stanford on CMAR contracts. He has also managed other contract types including: Design/Build, Integrated form of Agreement, Lump Sum and Agency CM Contracts.

CSU Perspective

CSU Overview• CM at Risk at CSU• Why CM at Risk• Changes to the CSU Process• We Could Do Better• Behaviors of Successful Team

CSU CM at Risk Process• Form a team: AE, CM, Owner• Design with contractor input• Take trade bids, arrive at GMP• Execute construction contract

Why CM at Risk?• Teams produce the best results• CM at Risk Creates a Team• It is all about performance• Allows the design to evolve

Changes to CM at Risk• New Process – Not system-wide yet• CM Selection – SOQ, Shortlist (4 +/-), Proposals• Interviews• Fee is weighted and added to score• Design-Assist and Design-Build trades during

Design Phase• Disclose staffing by position and schedule• Earlier GMP – Phased Projects

We Could Do Better• Owner must lead• Stay on Target• Openly discuss issues – even the bad and ugly

• Money, time, program, issue• Have executive level meetings – team check-up• CM must manage the entire project (Design

Phase and Owner)• Self-govern – Act on the “Delta”

Behaviors of Successful TeamsSuccessful Team = Successful Project

• Participate like it was the Super Bowl• Really collaborate – look for the new solution• PERFORM

• Performance promotes Trust• Trust promotes High Performance

• Remove the fear of trusting• Contribute what is yours to give

AOC Perspective

OVERVIEW

• Introduction• Administrative Office of the Courts (AOC) Program History• Program Scope – SB 1732 and SB 1407• Capital Projects in NCRO• Delivery Process, Methods and Perspectives• Outlook 2011

PROGRAM HISTORY

2001 – Task Force on Court Facilities2002 – Trial Court Facilities Act (Senate Bill 1732)2003 – Court Facilities Master Plans2004 – First Transfer2005 – First 5-year Plan; 2 Capital Projects Funded2006 – Senate Bill 10; 4 Capital Projects Funded2007 – 9 Capital Projects Funded2008 – Senate Bill 1407; 41 Projects Approved2009 – Transfer of all Court Facilities from Counties2010 – Approval to Proceed with all 41 SB 1407 Projects

CALIFORNIA ADMINISTRATIVE

OFFICE OF THE COURTS

SB 1732 CAPITAL PROGRAM SCOPE

• Active Capital Projects: 9• Estimated Total*: Over $1 billion• Projects:

1. Calaveras – San Andreas2. Lassen - Susanville3. Madera – Madera4. Mono – Mammoth Lakes5. Riverside – Mid-County Riverside/Banning6. San Benito – Hollister7. San Bernardino – San Bernardino8. San Joaquin – Stockton9. Tulare - Porterville

*Total Project Costs (Construction + Soft Costs)

SB 1407 CAPITAL PROGRAM SCOPE

• Active Capital Projects: 41– BANCRO – 7 projects– NCRO – 20 projects– SRO - 14

• Estimated Total: $5.0 billion

*Total Project Costs (Construction + Soft Costs)

SB 1407 PROJECTS IN NCRO (1)County Project Estimated

Construction Cost*1 Alpine New Markleeville $15,323,000

2 Butte New North Butte County $61,100,000

3 El Dorado New Placerville $77,190,000

4 Fresno Renovate Fresno County $102,904,000

5 Glenn Renovation and Addition to Glenn Historic Courthouse

$39,827,000

6 Kings New Hanford $121,616,000

7 Merced New Los Banos $27,033,000

8 Nevada New Nevada City $72,854,000

9 Placer New Tahoe Area $16,751,000

10 Plumas New Quincy $37,112,000

*Estimated construction cost includes hard and soft costs

SB 1407 PROJECTS IN NCRO (2)County Project Estimated

Construction Cost*11 Sacramento New Sacramento Criminal $363,529,000

12 San Joaquin Renovation and Addition to Juvenile Justice Center

$3,591,597

13 Shasta New Redding $142,278,000

14 Sierra New Downieville $15,897,000

15 Siskiyou New Yreka $82,588,000

16 Stanislaus New Modesto $235,542,000

17 Sutter New Yuba City $64,611,000

18 Tehama New Red Bluff $57,434,000

19 Tuolumne New Sonora $59,528,000

20 Yolo New Woodland $141,270,000

ESTIMATED CONSTRUCTION COSTS FOR NCRO SB 1407 PROJECTS:

$1,737,978,597

*Estimated construction cost includes hard and soft costs

CAPITAL PROJECT FUNDING PROCESS

•Site Acquisition Phase•Preliminary Plans Phase•Working Drawings Phase/ Bid and Award•Construction Phase•Key notes:

1. The end of each phase requires the review and approval of the State Public Works Board or Department of Finance to in order proceed to the next phase.

2. Start of Construction phase driven by bond sale (Spring/Fall).

3. Plays a key role in CM@Risk.

CAPITAL OUTLAY PROGRAM DELIVERY METHODS

• CM@Risk and Pre-Qualified Design-Bid-Build (DBB)– $50 million cap for DBB– Region/Location– Project Manager experience– Local Outreach– Design Timing– DBB (Pre-construction services with CM Agency)

• Other delivery methods (non-capital outlay,$100k-$5M)– Design-Assist– IDIQ General Contractor– Job Order Contracting

CM@RISK Owner’s Perspective

• Early input from construction team• Collaborative process (team approach)• BIM opportunities• More fluid• Design control stays with Owner (demanding

client)• Key Elements:

– Experienced project owner– Build trust early– Personnel chemistry– True Partnership (project before profit)

OUTLOOK 2011

• SB 1732– Anticipate upcoming fall bond sale for

construction• Calaveras (Pre-Qualified DBB)• Riverside (CM@Risk)• San Benito (CM@Risk)• San Bernardino (CM@Risk)• Tulare (CM@Risk)

OUTLOOK 2011

• SB 1407– Fund cuts – Cause & Effect– $310.3 million fund cut does impact the program– AOC will strive to keep projects moving forward in the best

interest of the program– Some projects will move into the next phase– Some projects will hold until the next fiscal year – July 2012

before moving into the next phase– Currently, all SB 1407 projects are being reviewed– Judicial Council is the final decision maker– Yolo and Lake are currently in Preliminary Plans phase.

CM@Risk RFQ/P will be issued this fall.

INFORMATION

Project details will be published with each solicitation. Please monitor the California Courts website for updates.

RFQ/RFPs: www.courts.ca.gov/rfps.htm

Judicial Branch Capital Program: www.courts.ca.gov/programs-facilities.htm

Project Descriptions: www.courts.ca.gov/2559.htm

To receive e-mail updates regarding solicitations, provide your contact information to: www.courts.ca.gov/programs-facilities.htm

http://www.courts.ca.gov/programs-facilities.htm�


http://www.courts.ca.gov/2559.htm�


Architect Perspective

What is the definition of CM@Risk?

• CMAR, CMC, CM/GC, GC/CM• GMP, GMAX, MACC/GCC• AIA vs. AGC vs. Customized Contracts

What is generally consistent (but not always)?

• Structure of contracting (A/E-Owner / Owner-CM)

• Selection process (RFQ/RFP/Interview)• “Best value” selection (Qualifications +

Price)• Input during design/GC during construction

Where is the “Risk” part?

• Pre-Construction Fees• GMP + Contingencies• Cost + Fees

Does CM @ Risk really add value?

• Participation during design• Owner design participation/control• Sub-contractor input

Does CM @ Risk really result in a collaborative environment?

• Balancing of roles• Contingency ownership/protection• Incentive provisions

Is CM @ Risk Architects’ preferred alternative delivery?

• Relationship with Owner/CM• Shared risk• Enhanced fees• Control of fate

Builders Perspective

Construction Management at Risk

• Definitions vary- CM holds contracts for subcontracted work- Preconstruction responsibilities include:

- Constructability- Build-ability- Estimating (vs. budgeting)

- Competition for the work typically based on fees, rates, experience, project approach and project team

Construction Delivery MethodsHard Bid Lump Sum or Stipulated Sum Construction Management at Risk

37 | Pfizer Partner Alignment | December 9, 2010

• Familiar delivery method• Defined project scope• Single point of responsibility• Pen, aggressive bidding

Pros

• No design phase assistance• Longer schedule duration• Price not established ‘till bids• Adversarial relationship• Lack of flexibility for change• Contractor keeps all savings

Cons

• Selection Flexibility• Design phase assistance• Single point of responsibility• Team Concept• Faster schedule delivery than traditional process• Change flexibility • CM is at risk for schedule and guaranteed maximum price• Non-adversarial relationships

Pros

• Limited number qualified CMs having proven systems and precon services in place

• Some architects are not experienced having to interact with a CM during the design phase

Cons



Pros



Cons


Pros

Cons

• Selection flexibility• Single point of responsibility for design and construction• Faster schedule delivery• Team concept

• Loss of check and balance• More difficult for Owner to manage• Potential adversarial relationship between Owner and

Design-Builder

Design-Build

Construction Delivery Methods

Construction Delivery Methods


Construction Management Agency

• Selection flexibility• Design phase assistance• Change flexibility

Pros

• No single point of responsibility• No guaranteed price or schedule• Owner must manage more contracts• CM agent is not a risk; is a consultant

Cons


Pros


Cons



40 Genentech Introductory Meeting | September 8, 2011

Skanska’s breakdown of Project Delivery Methods

31%39%

24%6%

CMAR – GMPCMAR – Cost Plus Fixed FeeDesign/Build EPCLump Sum

70% = CMAR

Perceptions of CMAR• Best delivery model

– Best team– Collaboration

• CM no risk – CM did not take responsibility for errors in

preconstruction.– CM did not take responsibility for construction

errors.

Contrast• CMAR

– Pursuit cost is minimal

– Selection is based on: Team, experience, fee

– Quality driven by team

• Design/Build– Pursuit cost is great– Selection based on

cost

– Quality driven by CM/GC

What is the Best Delivery Method?

• It depends– Do you have a CFO that requires 3 hard bids?– Do you have a BOD that contains someone with

limited and dangerous construction experience?

Questions

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