Palm Beach Undergrounding Master Plan COMPLETE MP Online-v4 | Page 86

change arises, as it often does with private individuals, it can easily be implemented by the CMAR. Since the CMAR is ultimately responsible for the schedule and the budget, they will generally bid the trade elements to subcontractors who are qualified and bondable, and who the CMAR has confidence will construct their scopes of work successfully. This enhances the quality of the work and reduces the risk that either the design professional or utility owner will reject the work. Work that is rejected and must be redone can pose a significant schedule risk in addition to quality concerns. Another advantage of this method is that the CMAR is far less likely to develop an adversarial relationship with the Town during the course of the project. This results in a construction team that is motivated to perform well for the Town, resolve issues quickly and cost effectively, and maintain a positive working relationship so they can continue working with the Town on future projects. For this reason, the risk of claims and lawsuits are often much lower for CMAR than other delivery methods. A lawsuit resulting from poor performance or claim on a project of this magnitude could have significant schedule and cost impacts. 70 | CHAPTER SEVEN Cost We understand that the question may arise whether using a CMAR will raise or lower the cost of the project. Having a very cost conscious group involved during the design process might lower the total cost of the project. However, by shifting the cost guarantee burden onto the CM, a case can be made that the actual savings may be less than promised if the CM is too conservative and risk-averse. There are studies that seem to indicate a substantial savings in cost growth (fewer change orders) through use of CMAR, but no good information on comparative initial cost for similar infrastructure projects. This is mostly due to the fact that Owner’s do not build the exact same project twice under different delivery methods. While the cost savings potential exists, there is no guarantee that it will cost more or less than any other delivery system. The CMAR project delivery method requires the least number of owner employees to manage the process because the CMAR can expand to meet the owner’s staffing needs. While not reflected in the GMP, the reduced owner personnel required to manage the efforts of the CMAR is a cost savings that needs to be considered. The CMAR process offers the Town “open book” transparency on how the construction price is developed. All of the sub-contractor bid proposals, CMAR overhead, project management, profit, and contingencies are clearly identified, shared with the Town, and agreed upon before the work begins. This also allows the Town to know the full budget for the project, unlike the DBB method where budget issues may not be discovered until well into the construction process. As compared to other project delivery methods, the Town maintains a greater degree of control over the construction budget and use of any contingency funds. Change orders are inevitable in any underground infrastructure project. While upfront sub-surface investigation mitigates this risk, it cannot eliminate the risk. In a DBB project delivery, the Owner and Design professional work together to manage the rising project cost due to change orders on the project. In a CMAR project delivery, the Owner and Design professional work together to preserve the Construction Contingency which ultimately lowers the final cost of the project. A significant cost advantage may be achievable through the Town’s direct purchase of materials which can be streamlined through use of the CMAR procurement method. The CMAR can coordinate these efforts directly, retain responsibility for accepting delivery, storage and installation of these materials while achieving tax savings for the Town. The Town’s history with this delivery method has been positive with projects being completed on-time or ahead of schedule and under the negotiated GMP. When the cost of the project is less than the GMP, the contingency funds are returned to the Town. CMAR Procurement Recommendations There are multiple ways to select a CMAR to perform a given project. Historically, the Town has selected their CMAR contractors solely on a Qualifications-Based selection methodology. The CMAR then negotiates a pre-construction services fee, bids out the subcontracted trades, and assembles a final GMP which is negotiated and agreed upon by the Town and CMAR. Another method that was explored by the Town to select the CMAR is the Best Value Selection method. With this method, both the cost of the work and qualifications are factors in the final selection of the CMAR. Weighted factors are applied to both cost and qualifications submitted by prospective CMAR’s and the highest aggregate score determines the CMAR who will provide the Best Value to the Town. The cost elements that could be considered in a Best Value selection process include: y y Preconstruction Services TOWN OF PALM BEACH