Sharing Work Zone Effective Practices for Design-Build Projects

Chapter 2: Lessons Learned and Best Practices in Design-Build Projects

Overview

This chapter identifies lessons learned and best practices from design-build procedures and projects. These insights, presented in bulleted lists, are organized around the following issues or subjects: project selection; design quality management; construction quality management; utilities/right-of-way/railroad coordination; design-builder selection process; writing design-build request for qualifications/proposals; use of alternative technical concepts; schedule performance, milestones, and progress payments; change orders; claims and dispute resolution.

Project Selection

This section presents the scenarios where design-build is more suitable than other project delivery methods. The scenarios include:

• Project Size: Design-build is more suitable for medium to large complex projects where innovative concepts can be applied to project design and development during the project conceptualization stage. Limited support is typically expected from the contracting industry for projects that are smaller in size (typically, less than $10 million).
• Project Complexity and Innovation: Design-build is more suitable for complex projects with scope for industry inputs and design-builder innovation in the design and schedule. Since there is a single point of responsibility between the designer and contractor, the design-build contracting allows for collaboration between these entities. Design-build contracting encourages innovation through:
  • Alternative technical concepts (ATC) process.
  • Best value procurement.
  • Early design-builder involvement.
  • Process optimization between designer and contractor.
  • Performance specifications (if used).
  The project should have a strong design component to allow for design-builder innovation; however, if the owner/agency advances the design too far, there will be less scope for design-builder innovation.
• Schedule: Design-build is more suitable for projects where there is potential to accelerate the schedule. Design-build contracting allows for concurrent design and construction processes, albeit with a shorter schedule lag, to expedite construction. The design-builder has the ability to start construction before the entire design, plans and specifications, right-of-way acquisition, and utility relocation are complete.
• Cost Certainty: Design-build is more suitable for projects where cost certainty is necessary. Since the costs are contractually committed early in the process, i.e. before substantial design is complete, the design-build contracting allows varying the project scope to match the price. Not only does this force the project to design a fixed price, but it also allows the owner/agency to get the maximum scope for a fixed price in the market.
• Design Requirements: Design-build is not suitable for projects where the owner/agency is not clear on the project scope and requirements. The request for proposals (RFP) should articulate the project scope and requirements very clearly, since the RFP forms the basis for the contract. Change orders on design-build projects are typically less frequent than on other traditional project delivery methods. However, these change orders can be expensive if the changes have to be made to design, once the construction is underway.
• Other Conditions: Design-build is suitable only on projects where risks related to the environmental approvals and processes, permitting, right-of-way, railroad, hazardous materials, utility issues, and other third-party agreements are well-defined and properly allocated to the party that best manages them. Poorly defined risks, such as design risks, can be expensive, as they could result in change orders during construction.

Note: The University of Colorado, Boulder has developed a project delivery selection guidebook and matrix tool that assists owners/agencies in determining the appropriate delivery method for highway projects. This approach uses a matrix to consider three fundamental delivery methods currently in use by the highway industry: design-bid-build, design-build, and construction manager/general contractor. The approach includes four primary selection factors (delivery schedule, complexity and innovation, level of design, and initial project risk assessment) and four secondary selection factors (cost, staff experience/availability, level of oversight and control, and competition and contractor experience) in the delivery decision.

The selection matrix tool has been successfully tested and implemented for a wide range of projects of varying scope throughout Colorado (see the Colorado DOT’s Project Delivery Selection Matrix Web page).

Design Quality Management

This section primarily discusses the roles/responsibilities of design-builder and owner/agency on design quality management of a design-build project.

Request for Proposal Requirements

• The design-builder is typically responsible for proposing and implementing a design quality control system (DQCS).
• The owner/agency should propose and implement a design acceptance system.
• The RFP should articulate the qualifications (education, experience, and certification requirements) for the following personnel, as a minimum: quality control (QC) administrator responsible for design and construction quality, design QC manager, design manager, key personnel for design production, construction QC manager, construction manager, and key personnel for construction production.
• The design-builder should be required to prepare and follow a project-specific quality system manual (QSM) that clearly describes the QC requirements and procedures that will be implemented on the project.
• The owner/agency should specify the minimum level of QC documentation that must be provided by the design-builder as well as the timeframe and format for providing the information.
• The owner/agency should specify design submittal and documentation requirements in the RFP.
• The owner/agency should understand the project requirements and should articulate them in unambiguous terms in the RFP through design requirements and performance criteria.
• A poorly written RFP, with conflicting design requirements, may create design uncertainties and misunderstandings, thus prompting bidders to build a risk contingency into their pricing.
• The RFP should identify performance criteria, methods specifications, and appropriate design and construction standards to be followed as appropriate.
• The owner/agency should consider including in the RFP a clause for transportation management plan (TMP) mandatory meeting with all the stakeholders.

Design Quality Control System

• The design-builder should develop a QSM, in accordance with the RFP requirements, and submit for the owner/agency's approval before the notice to proceed for design is issued.
• At a minimum, the design-builder's QSM should contain information for the following categories:
  • QC Organization & Roles.
  • Document Management Procedures.
  • Design Quality Control Procedures.
  • Construction Quality Control Procedures.
  • Quality Control Organization Chart and Tables.
  • Design Quality Control Forms.
  • Quality Control Inspection Report Forms.
  • Quality Control Test Report Forms.
  • Preliminary QC Inspection Schedules.
  • Preliminary QC Testing Schedules.
  • Mock-Up and Control Section Forms.

Design Submittal Requirements

• The owner/agency should establish design submittal requirements for the project.
  • Design submittals should be broken into work packages based on the sequence of construction items.
  • Design submittal of items with long lead times or many indeterminants should be identified and prioritized.
• Design-builder should provide the owner/agency with weekly documentation (in an agency-approved format) of all work performed to date and access to all teams to facilitate shorter review periods.
• The owner/agency should maintain a document management system, process, and procedures to identify, review, approve, and track changes in all documents pertinent to the project. The document management should include, as a minimum, an electronic project filing system, standard document file naming convention, electronic file revisions and redline markups, email standards, protocols, and filing system and construction document management.
• The owner/agency should create a risk profile of design requirements. For instance, design items can be color-coded red, yellow, and green in the order of risk magnitude. Review items with the greatest risks should be addressed first.

Design Quality Control Process

• Establish a process for both informal and formal design reviews.
  • The design-builder's informal review should include "self-checks" and internal coordination with construction personnel. The owner/agency's informal review should include "over-the-shoulder" design reviews and audits while the design is in progress.
  • The owner/agency formal design review should include milestone-based work packages, interdisciplinary reviews, and independent design checks.
• Contractual relationships must not be violated.
• The owner/agency should:
  • Develop design review checklists for all aspects of the design review, including right-of-way, easement, and control of access, traffic control, transportation management plan, etc.
  • Devise a process for comments tracking and resolution.
  • Develop a process for interdisciplinary review and constructability review.
  • Develop a process for conducting independent structural design checks. Design-build team experts who are not directly involved in the design can perform the design checks, as getting a third party for design review can be expensive.
  • Develop a process to identify and manage nonconforming work.
  • Develop a process to allow for minimal design work packages as required by the design-builder for executing the construction work.

Owner/Agency’s Review Process

• Over-the-shoulder review is suggested for approving the design-builder’s design submittals. Physical proximity between the design-builder and owner/agency personnel is important.
• The owner/agency should assign "lead" persons for each expertise area. The lead person should be able to understand the design, specifications, and impacts of quality and design on construction and make critical decisions.
• The owner/agency should establish a realistic design review schedule to ensure timely review and approval of design submittals. The owner/agency should also establish the level of details required for design reviews. Micro-level review of designs should generally be minimized. In addition, a request for information (RFI) should be prioritized and minimized to avoid overloading both owner/agency and the design-builder.
• The owner/agency should also establish the level of details in the design submittal for release for construction (RFC) approval.
• Periodic meetings should be scheduled between the owner/agency engineers/experts and the design-build team to discuss the critical issues and approve the design submittals in a shorter timeframe.
• The review comments and responses may be provided in the format preferred by the design-builder and the owner.

Construction Quality Management

This section primarily discusses the roles/responsibilities of design-builder and owner/agency on construction quality management of a design-build project.

Request for Proposal Requirements

• The owner/agency should list all applicable construction requirements, including standards, specifications, and special provisions.
• The design-builder should develop a QSM that addresses the construction QC procedures.
• The design-builder should identify all QC personnel and procedures that will be used to meet the owner/agency's specification requirements.
• The RFP should list all the major work items that require QC plans.
• The owner/agency should specify the standard QC plan format in the RFP:
  • Terms and definitions.
  • Applicable specifications.
  • QC organization.
  • QC laboratories.
  • Materials control.
  • Production facility QC.
  • Field QC.

Construction Quality System

• The owner/agency and the design-builder should be involved in the construction QC process. Construction QC should include:
  • Independent checks of materials/workmanship.
  • QC inspection.
  • Work item coordination reviews.
  • Pre-production and pre-placement checks.
  • Self-inspection of work items.
• The design-builder creates and submits a QC plan for the owner/agency’s approval.

Construction Quality Control Process

• The design-build team should include a construction QC manager who leads the construction QC team which performs formal construction QC.
• The owner/agency’s construction manager is in charge of informal construction QC.
• QC inspection involves visual observations. Both the owner/agency and design-builder should be involved in the construction QC inspection process.
• QC sampling and testing is used to maintain control of each process, and the data may also be included in acceptance determination.
• The owner/agency is responsible for monitoring the design-builder’s QC activities.
• The owner/agency independently conducts quality measurement activities such as acceptance inspection and acceptance testing.
• The owner/agency’s acceptance samples should random and independent of the design-builder’s QC samples.

Utilities/Right-of-Way/Railroad Coordination

This section primarily discusses the roles/responsibilities of design-builder and owner/agency during utility/right-of-way/railroad coordination.

• Owners/agencies and design-builders should be involved in the stakeholder/partner coordination process.
• Right-of-way responsibilities need to be clearly defined in contract requirements and appropriately allocated to both the design-builder and the owner.
• Prior to releasing the RFP, the owner/agency should verify that all right-of-way can be obtained prior to execution of the contract.
• The RFP should identify the right-of-way and temporary easement availability and additional right-of-way needed.
• The owner/agency should be involved in early right-of-way acquisition and utility relocation process.
• The owner/agency should take the lead on right-of-way and temporary easement acquisition.
• The right-of-way acquisition process should begin as early as possible.
• The owner/agency should anticipate and identify difficult acquisitions early in the process and concentrate early efforts on acquisition/relocation that will require more lead time.
• The RFP should specify if the design-builder is allowed to use a right-of-way consultant, and if this is acceptable to the owner/agency, the RFP should layout the responsibilities of the design-builder and corresponding submittal requirements.
• The RFP should specify the requirements and alternatives, if the right-of-way acquisition is not completed before the beginning of construction.
• The owner/agency and design-builder should identify all known public and private utilities in and around the project location early in the design process.
• The owner/agency should determine if the utility company or the design-builder will be responsible for utility relocations.
• Responsibilities related to railroad grade crossing permits and railroad coordination should be defined by the owner/agency during the permit process.
• Regular community meetings should be conducted to keep the public informed.
• The design-builder should notify the owner/agency immediately upon the discovery of any assumed hazardous materials, as well as any historical or archaeological site.

Design-Builder Selection Process

This section provides information on the two-step procurement process on design-build projects, including a) a request for qualifications (RFQ) that involves determination of short-list of proposers and b) RFP that involves selection of design-builder from short-listed proposers who submit proposals.

One-Step Process versus Two-Step Process

• In a one-step process, the owner/agency issues an RFP only.
• In a two-step process, the owner/agency issues a request for an RFQ and shortlists proposers based on qualifications. The RFP is then issued to the shortlisted proposers to submit technical proposals. The technical proposals should be ranked to identify the most highly qualified proposers for the type of project.

Draft Request for Proposal Package

• To maximize design-builder innovation, the RFP should be developed with the goal of minimizing prescriptive requirements and maximizing the use of performance requirements.
• For Federal-aid design-build projects, the provisions of 23 CFR 636.201 provide for the following award criteria: lowest price, adjusted low-bid (price per quality point), meets criteria/low bid, weighted criteria process, fixed price/best design and best value.

Pre-Proposal Meeting

• Confidential meetings between the owner/agency and each proposer before the proposal evaluation helps facilitate an open discussion of ideas, concerns, and other items related to the proposal (e.g., ambiguities).
• All information discussed in the pre-proposal meetings should be kept confidential.
• Often, ATCs will be discussed at the pre-proposal meetings.

Proposal Evaluation

• Evaluation factors should be tied to the project goals.
• Evaluation factors should be clearly stated in the RFP. The evaluation process should be fair and transparent.
• Evaluators should be unbiased, trained on the owner/agency’s processes, and consistent in their reviews.
• Technical proposal reviewers should not have access to the price proposals during technical proposal evaluation.
• Unsuccessful proposers should have the opportunity to participate in a debriefing session.
• The owner/agency should establish proposal scoring criteria well in advance of proposal submittal process.
• The owner/agency should consider using standardized training and scoring forms to evaluate proposals.

Writing Design-Build Requests for Qualifications/Requests for Proposals

This section deals with the owner/agency considerations while drafting RFQs/RFPs.

• The owner/agency should advertise the project as early as possible.
• Prior to drafting the RFQ/RFP, the owner/agency should identify alternative funding opportunities for the project.
• The owner/agency should clearly identify its Statement of Qualifications (SOQ) evaluation criteria and scoring system in its RFQ.
• The owner/agency should determine if a consultant is needed and, accordingly, establish the consultant’s role and guidelines prior to RFQ stage.
• RFPs should contain as many performance-based criteria as possible, while limiting the number of prescriptive criteria.
• The owner/agency should use performance-based specifications only on projects where it can verify compliance.
• The project goals and risks, and the allocation of those risks, should be clearly identified in the RFP. The risk assignment should be based on the complexity and specific needs of the project.
• The owner/agency should use RFQ/RFP language that is easy to understand.
• The owner/agency should establish an internal escalation process for RFP development.
• The owner/agency should decide early in the process how RFP information will be organized and distributed to the proposers—electronic, hardcopy drawings and reports etc.
• The contract should encourage open communication between the owner/agency and design-builder.
• Coordinating with local agencies and impacted stakeholders, and describing project procedures as part of the RFP, should be considered for better defining risk and responsibilities between the owner/agency and design-builder.
• For better cost estimates, the owner/agency should consider involving an estimator throughout the RFP development phase.
• The roles and responsibilities of all parties should be clearly explained in the RFP.
• The owner/agency and the design-builder should collaborate on identifying key areas of risk on a design-build project.
• The RFP should clearly establish how the various team members should communicate with each other.
• The owner/agency should require the proposer to develop a quality management plan that documents all the QC requirements for both design and construction.
• The owner/agency should clearly define in the RFP the requirements and staffing levels for quality control/quality assurance personnel relating to design or construction.
• Internal workshops/meetings involving key technical staff should be held to review the RFP as it is developed through the project development phase.
• The RFP should outline the required process in cases where changes proposed by the design-builder triggers a National Environmental Policy Act (NEPA) re-evaluation.
• The owner/agency should consider providing supplemental geotechnical information along with the RFP.
• The owner/agency should allow additional requested elements (ARE), as part of the basic configuration or temporary configuration, wherever appropriate.
• The owner/agency should consider legal coordination throughout the RFQ/RFP development process.

Use of Alternative Technical Concepts

This section discusses the use of ATCs on design-build projects. ATCs allow design-builders to submit innovative, cost effective solutions that are equal to or better than the owner/agency’s design and/or construction criteria.

• Owners/Agencies should encourage ATCs from the proposers to allow for greater innovation on the project.
• Owner/agency should consider holding confidential one-on-one meetings with each proposer throughout this stage of the project development. This meeting allows the proposer to get their ideas vetted and reviewed by the owner/agency, before any formal submittal is made.
• The owner/agency should:
  • Provide the design-builder an opportunity for revisions to ATCs.
  • Link equal or better considerations to project goals.
  • Make sure ATC reviews are consistent.
  • Have technically qualified people review the ATCs.
  • Clearly define the ATC submittal requirements.
  • Clearly explain the ATC process.
• The owner/agency may, if necessary, include addenda to the RFP based on submitted ATCs.
• Owner/agency should require proposers to specify why approved, individual ATCs have not been incorporated into their proposals.
• Owner/agency should establish means to handle the difference in cost savings between the nonselected proposers ATCs and what the best value proposer offered during negotiations.
• Owner/agency should consider the use of separate panels to evaluate ATCs and proposals.
• ATCs that affect local agencies should have their approval as a condition of acceptance.
• The owner/agency should establish submittal dates for ATC submittals that maximize the potential benefit to both the department and proposers.

Schedule Performance, Milestones, and Progress Payments

This section relates to specifying maximum construction duration, establishing interim milestones, and incentive/disincentive (I/D) based payments.

• Owner/agency should clearly define in the contract the requirements for achieving project milestones, including substantial completion, final completion, and final payment.
• Owner/agency should use appropriate contractual incentives that facilitate the alignment of the performance of their design-build teams with the owner/agency’s project goals.
• Payments are made after owner/agency is satisfied with the completion of the design/construction work packages.
• A schedule of values, which is a statement furnished by design-builder allocating portions of the contract sum to various portions of the work and used as the basis for reviewing design-builder's applications for payment, should be used on design-build projects.
• The design-builder should always notify the owner/agency of any project related issues that may impact the contract price and schedule, to enable the owner/agency to make informed decisions on resolving such issues.

Change Orders

This section provides information on change orders on design-build projects. A change order is a legal and binding agreement that modifies the original contract as executed and approved by the owner/agency.

• A change order involves changes to the original scope of the contract, revisions to the confirmed/approved project schedule, and sets forth other modifications in time, money, or authorization.
• Typical types of changes include:
  • Change to scope of work.
  • Unforeseen conditions.
  • RFP/performance criteria.
• Owner/agency should clearly define design-build change order criteria and the change order approval process, including the different courses of action that should be adopted when the owner/agency or the design-builder initiates the design-build change order.

Claims and Dispute Resolution

This section discusses claims and dispute resolution on design-build projects.

• The owner/agency should clearly outline dispute resolution process in its RFP.
• Disputes should be resolved at the lowest level possible.
• The owner/agency should establish statutory and contractual claims resolution processes and/or forums for design-build projects.
• Alternative dispute resolution processes written into the contract can promote prompt identification and resolution of disputes.
• Periodic project/contract document reviews by both the owner/agency and design-builder, along with status meetings, provide an approach to keep communication open.