Copyright © DBIA 2003 2003 Edition An Introduction To Design-Build.
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Transcript of Copyright © DBIA 2003 2003 Edition An Introduction To Design-Build.
Copyright © DBIA 2003
2003 Edition
An Introduction ToDesign-Build
Design-Build Overview
• D-B Defined/Introduction
• Milestones in Recent D-B History
• Major Project Delivery Systems
• D-B Performance, Procurement and Process
• D-B Utilization
continued
Design-Build Overview, continued
• DBIA Resources– DBIA Publications/Website: www.dbia.org– DBIA Contracts
• D-B Legislation/Trends
Design-Build Defined
Design-Build is a method of project delivery in which one entity (design-builder) forges a single contract with the owner to provide for architectural/engineering design services and construction services. (Design-build is also known as design/construct and single source responsibility.)
Design-Build Introduction
• Rediscovered approach to project delivery
• Team of qualified design and construction professionals
• Operating under a single contract
• Single source accountability
Milestones in Recent Design-Build History
1940s Naval Facilities Engineering Command uses the
Capehart and Wherry Housing Programs thatemploy design-build
1962 National Aeronautics and Space Administration
(NASA) uses design-build
1968 Department of Housing and Urban Development
starts use of forms of design-build: Turnkey,Operation Breakthrough
1969 Associated General Contractors (AGC ) appoints
“Turnkey Committee”
Milestones in Recent Design-Build History
1972 Congress Passes Qualifications-Based Selection
(Brooks Act) for A/E Contracts
1975 AGC Publishes first edition of Standard Agreement
Between Owner and Design-Builder
1978 The American Institute of Architects (AIA) adopts
a policy permitting members to do design-build
1984 Competition in Contracting Act places competitive
negotiation on par with competitive sealed bonding
1985 AIA publishes family of design-build documents
Milestones in Recent Design-Build History
1986 Military Construction Authorization Act permitstrial use of design-build: Each branch is
permittedto use design-build on three projects a year
1990 General Services Administration issuesDesign Criteria Project Guide
1991 AIA adopts policy acknowledging the use of design-build in the public sector
1993 Design-Build Institute of America established
Milestones in Recent Design-Build History
1995 Engineers Joint Contract Documents Committee(EJCDC) issues design-build contracts
1996 Legislation (Davis Amendment) enacted permitting
use of two-phase selection for federal design-build
projects
Major Acquisition/Project Delivery Systems
I. Design-Bid-Build
II. Construction Management
III. Design-Build
Project Delivery: A comprehensive process including planning, design, construction and other services, necessary for organizing, executing and completing a building, facility or project.
Acquisition/Project Delivery Systems
I. Design-Bid-Build• A/E prepared plans and specifications• Low dollar bid from general contractor• Separate contracts from owner for design and
construction
Owner
A/E Constructor
DesignConsultant
Subcontractorsand Suppliers
Acquisition/Project Delivery Systems
II. Construction Management• Agency construction management• “At-risk” construction management• Separate contracts for design and construction
Owner
A/E GC/TradeContractors
DesignConsultant
Specialty Contractors
And Suppliers
At-Risk CMAgency CM
Owner Agency CM
A/E GC/TradeContractors
DesignConsultant
Specialty Contractors
And Suppliers
Acquisition/Project Delivery Systems
III. Design-Build• Design and construction under a single contract
• Construction typically begins before design is complete
Acquisition/Project Delivery Systems
III. Design-Build – Integrated Firm or Joint Venture
Owner
Design-Builder
Consultants,Specialty and Subcontractors,
Manufacturers/Suppliers
Acquisition/Project Delivery Systems
III. Design-Build – Constructor-Led
Owner
Design-Builder
DesignConsultant
Specialty and Subcontractors, Consultants,
Manufacturers/Suppliers
Acquisition/Project Delivery Systems
III. Design-Build – Designer-Led
Owner
Design-Builder
ConstructorSpecialty and Subcontractors,
Consultants,Manufacturers/Suppliers
I. Design-Bid-BuildAdvantages and Disadvantages
A. Advantages of Design-Bid-Build1. Comfortable “old” way of doing things2. Suitable for competitive bidding3. System of checks and balances4. Established legal precedent5. No legal barriers in procurement and licensing6. Insurance and bonding are defined
I. Design-Bid-BuildAdvantages and Disadvantages
B. Disadvantages of Design-Bid-Build1. Confusing responsibilities - all parties have
different agendas
2. Disagreements go through owner
3. Owner bears design adequacy risk
4. Too much case precedent
5. Project delivery can be slow
6. Not always cost efficient
II. Construction ManagementAdvantages and Disadvantages
A. Advantages of Construction Management1. Multi-year track record, used since the 1960s2. Preconstruction involvement3. Additional management oversight controls
B. Disadvantages of Construction Management1. Not fundamentally different from design-bid-
build2. Agency CM places much risk on owner3. Innovation is not encouraged/rewarded
III. Design-BuildAdvantages and Disadvantages
A. Advantages of Design-Build1. Single point of responsibility
2. Owner freedom from coordination between A/E and constructor
3. Savings - in schedule and potentially in cost
4. Improved risk management
5. Early knowledge of firm costs
6. Rewards innovation
III. Design-BuildAdvantages and Disadvantages
B. Disadvantages of Design-Build1. New territory - parties assuming different
risks2. Institutional barriers - procurement and
licensing3. Owner relinquishes some control4. Limited availability of insurance/bonding
products5. Complexity/learning curve
Procurement/Purchasing PhilosophiesPrescriptive-Based Procurement
Advantages1. Provides descriptive documents for
proposers
2. Owner will control outcome before proposers submit technical/design solutions
3. Easier to establish firm budget before advertising project
Procurement/Purchasing PhilosophiesPrescriptive-Based Procurement
Disadvantages1. Restricts creativity of design-builder in
developing proposal
2. Places greater design risk on the owner
3. Reduces options for developing a project that could shorten overall schedule
4. Severely impedes innovation
Procurement/Purchasing PhilosophiesPerformance-Based Procurement
Advantages1. Leaves maximum flexibility for the design-
builder
2. Allows design-builder to optimize costs
3. Allows design-builder to integrate design and construction effort to reduce schedule
4. Minimizes risk to owner for design adequacy
Procurement/Purchasing PhilosophiesPerformance-Based Procurement
Disadvantages1. Risk of owner not being satisfied with project
scope
2. Owner relinquishing control
3. Difficulty in comparing proposals on an “apples-to-apples” basis
Procurement/Selection Spectrum
Sole Source
“Brooks”A/E
Selection
NegotiatedSource
Selection
CompetitiveNegotiation
WeightedCriteria
FixedBudget/
Best Design
AdjustedLow Bid
Two-StepSealedBidding
Low FirstCost
Bidding
Subjective and Qualitative Factor(s)
Price-Based Factor(s)
Best Value: Subjective, Qualitative and Quantitative
Factors
Bilateral Discussions -
Choice Based on Qualitative/
Subjective Factors
Formal Discussions - Choice Based on a
Combination of Qualitative and Quantitative Factors
Unilateral Choice, Based on Qualitative
and Quantitative Factors
Unilateral Choice, Based on a Single Quantitative Factor
Design-Build andBest-Value Procurement
• Historically designer only selections are qualifications-based
• Historically constructor-only selections are low price-based
• With the procurement of design-build services, one can combine the two into a best value selection
continued
Design-Build andBest-Value Procurement, cont.
• Best-value selection - combination of technical and cost criteria
• Best value ranges from qualifications to price oriented selections
Design-Build Structural Variations
OwnerIntegrated
Design-Build Firm
Owner Joint Venture
Owner A/E Prime
Owner GC Prime
A/E
Constructor
Constructor
A/E
Percentage of Design(As included in or required by Design-Build RFP)
-10% -5% 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% 55% 60% 65% 70%
Pre-Design
Usually Best Value or Qualifications-Based Procurement
Typically Low Bid-Based Procurement
Design Draw-Build35% Design or Greater
Direct Design-Build-10% to 10%
Design CriteriaDesign-Build5% to 25%
Preliminary Design
Design-Build 20% to 35%
Percentage of Design(As included in or required by Design-Build RFP)
• 30% design or more leads to price oriented selection
• Less design provided or required - more emphasis on technical/qualifications criteria or on design-builder’s proposed solution
• Owners initially provide or require more design in D-B procurements
continued
Percentage of Design, cont.(As included in or required by Design-Build RFP)
• After initial experiences owners provide or require less design– Recognition of cost and time required to
prepare a design that may not be ultimately constructed
• Experienced owners prefer more emphasis on qualifications
Influence vs. Expenditure CurvesDesign-Build Team on-board early allows best opportunity to achieve objectives
PERFORM BUSINESS PLANNIN G
PERFORM PRE- PROJECT PLANNIN G
EXECUTE PROJECT OPERATE
FACILITY
I N F L U E N C E
E X P E N D I
T U R E S
RAPIDLY DECREASING
INFLU ENCE LOW INFLU ENCE MAJOR
INFLU ENCE
EXPEND ITURES INFLU ENCE
High
Low Small
Large
Market Penetration ofMajor Project Delivery Systems
35%
9%
50%54%
65%
72%
82%
40%
9%10%9%12%
12%
9%
5%
25%30%
45%38%
15%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
1985 1990 1995 2000 2005 2010 2015
"Traditional" design-bid-build
Construction Management (at risk)
Design-Build
Construction Industry Institute Study
• 351 Projects
• 5K to 2.5M S.F.
• Various types/Industry sectors
• Compared performance between D-B-B, CM at Risk, and D-B
• Performance evaluated Cost, Schedule, Quality areas
Construction Industry Institute Study
• Design-Build Performance compared to Design-Bid-Build– Unit Cost - 6% less– Construction Time - 12% faster– Project Time (design and construction) -
33% faster
Construction Industry Institute Study
• Quality on a 10-point scale -– Start-up; Call Backs; O&M; Exterior and
Structure; Interior; Environmental; Equipment
– D-B equaled or outperformed D-B-B in every category
Drivers for Design-Build
• Early Completion• Reduced Owner Staffing• Single Source Responsibility• Reduces Uncertainty• Less Conflict• Potential for Lower Costs• Increased Quality• Equal or Increased Innovation
Design-Build National Trends
• Increasing use in public sector at all levels of government
• RFPs include less design specifics, more oriented toward achieving performance objectives
• Selections place increasing value on qualifications over price
continued
Design-Build National Trends
• Large design-build projects becoming more complex
• More industry sectors using design-build– Transportation/public utilities– K-12 educational facilities
• More owners see advantages of single contractual responsibility and a multidisciplinary team
continued
Design-Build National Trends
• Part of more integrated solutions which include financing, operation, maintenance, and/or ownership
• More designers, particularly engineering firms, are placing themselves in an at-risk role by leading design-build teams
continued
Design-Build National Trends
• Federal agencies, particularly the Federal Bureau of Prisons, the Naval Facilities Engineering Command, and the Corps of Engineers, are leading the trend in the public sector toward increased use of design-build
• New Federal design-build legislation in the last three years includes pilot programs for Federal Aviation Administration and the Civil Works Program of the Corps of Engineers and a major provision in the federal-aid highway program (TEA-21)
Your Help Is Needed:
• Licensing reform
• Procurement law reform
• Adoption of ABA Model Procurement Code
Removing Statutory Barriers
• State laws require modification
• Champions must emerge within states
• Joint industry/owner teams effective
• Example statutes available
• Lack of knowledge of D-B a barrier
• Education - a major effort
• Consult DBIA/others