Environmental Science & Engineering - www.esemag.com - September 2002
Comments? send them to the editor.

The design/build process for water and wastewater infrastructure construction

By Cam Vatandoust, P.Eng.*
The Design Build Institute of America describes Design Build (DB) as a process, in which architectural/ engineering and construction services are awarded under a single contract, thereby combining the vital roles of designer and constructor. Typically DB is a partnership between a professional engineering consultant (designer of the works), and a contractor (constructor of the works).

DB continues to remain a popular method of delivering capital works projects in Canada. The advantages of this process make it an attractive option for owners.

Scheduling For works which must be constructed under precise time constraints, the DB process can substantially reduce the amount of time needed to complete preliminary engineering, design, and construction phases of the project, thereby reducing the length of time from contract award to commissioning of the works.

Intricate and Challenging Works Complex works that are to be constructed in uncertain and demanding site conditions, can take great advantage of the DB process. Compared to a conventional contractor, a Design Builder is given much more freedom to modify its design to fit unforeseen site conditions and meet other project-specific demands.

Risk Transfer The DB process transfers the risk associated with the design and functionality of the works from the Owner to the Design Builder. Although this may appear to be advantageous to the Owner, it will undoubtedly result in unfavourably high tender cost submissions. The Design Builder must include in its total contract price, the cost of potential risks associated with these uncertain conditions.

The Owner's Agent In most design build contracts, the Owner enters into a contract with a Project Manager (PM). The role of the PM is quite critical in delivering the works. Although, the PM represents the Owner, nonetheless, it has a delicate responsibility to ensure that both the Owner and the Design Builder meet their contractual obligations.

The PM must be both professional and fair. The PM's primary role is to interpret the contract agreement to the best of its ability, and therefore, must also be impartial in its dealings regarding all contractual matters. The Design Builder's role is to design and construct the works, and the Owner's responsibility is to compensate the Design Builder in accordance with the contract terms and conditions.

The PM is responsible for delivering the project on time, and on budget, in each project phase including:

issuing Expressions of Interest (EOI) for the contract;
evaluating EOI submissions, and short listing a pre-determined number of DB teams based on a pre-determined set of evaluation criteria;
issuing the Request for Proposal (RFP) to these DB teams;
evaluating DBs' proposal submissions;
making recommendations to the Owner on contract award;
awarding the contract on behalf of the Owner;
executing the contract agreement between the Owner and the Design Build team; and
putting in place all procedures necessary to ensure delivery of a successful contract on time and on budget, including contract administration, site inspections, quality control, etc.

Although DB seems an ideal method to deliver capital works projects, it poses its own unique set of challenges and disadvantages.

Project Control The Owner may be unenthusiastic about giving up control of the project especially during the detailed design phase. This legitimate concern can be resolved by writing these specific requirements in the RFP document. This ensures that the Owner maintains control over some of the design aspects.

Higher Contract Price No Owner likes the extra risk associated with the unknown parts of the project (e.g. site conditions, soil quality, etc.) The Owner, therefore, would ideally like to transfer all unknown risks to the Design Builder. Often, DB contracts include clauses such as: “All costs associated with dewatering are to be included in the Design Builder's total contract price.” The DB team, in return, is forced to build in a "safety factor" into its contract price, in case unfavourable site conditions are encountered. This increases overall contract price.

Approvals Another important aspect of the DB contract is securing the necessary approvals to ensure on time completion of the project. This stage often proves to be the most critical aspect of any contract. In today's "environmentally sensitive" world, these approvals may vary from necessary completion of a Class EA Process, to obtaining approvals from various Federal Agencies, such as Fisheries and Oceans Canada, Canadian Transportation Agency, and/or other numerous Provincial Ministries and Agencies.

Actually, obtaining the green light to proceed with the project can often make the difference between a project on time and budget, and one which is late and has gone way over budget. Therefore, due to the sensitive nature of these approvals, all project stakeholders including the Owner, DB team, and the PM must work together to remedy any sensitive situations, to ensure that the desired outcome is obtained.

Evaluation of the Proposals and Award Arguably, one of the most important parts of the PM's role on any DB project is evaluating the DB team submissions, and making a recommendation on contract award to the Owner. This phase is extremely critical. In order for the evaluation process to be impartial, and without bias, all proposal submissions must be evaluated against a pre-set evaluation criterion. The Owner and the PM, prior to tender closing, must agree upon the evaluation criterion, so that potential post-tender uncertainties are minimized.

A very common method of evaluating the DB submissions is to divide the evaluation score into two parts:

Technical and design features; and
Total contract price.

However, since the DB teams are free to choose their own design, a good option for the PM is to hold confidential interviews with each finalist, and accept all the various designs. This means that the PM's evaluation team may request the DB to modify its design to adhere to certain preferences and/or requirements posed by the Owner. Once the Owner and the PM have deemed all the designs acceptable, then, the PM can obtain quotations from each team based on the requested modifications. The PM, then, is free to award to the lowest bidder without any conflict with respect to the diversity of the submitted designs.

Also, in order to ensure that the Owner receives an accurate total cost for the works, the PM can request a "Total Cost" for the works. The "Total Cost" includes the Construction costs, as well as the Operational costs over the life of the works (e.g. 20 years). The Operational costs include such items as routine maintenance, energy and replacement parts. This not only gives the Owner a more accurate cost for the whole project, but also, causes the Design Builder to search for the most economical long-term solution, adding value to the works. In order to determine this "Total Cost", the PM should pre-set values for all constants needed to calculate this in the RFP (e.g. cost of electricity per kWh, and unit cost of labour in dollars per manhour). This "Total Cost" should be used to compare all DB submissions.

A good PM is one who executes the contract fairly and without bias. This is the most critical way to ensure project success. Although many remain skeptical of aids such as conducting Partnering Workshops among all stakeholders, there is much value in bringing together different people with diverse agendas to achieve a common goal, a quality project on time and on budget.

* Cam Vatandoust, P.Eng., is a senior evaluations engineer with Ontario Ministry of the Environment in Toronto, specializing in water and sewage infrastructure. He is also an instructor at Ryerson University's Continuing Education division.

See our home page on how to order your subscription. We regret we can only accept orders from Canada and the United States.