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SUBJECTS › PUBLIC WORKS › Washington State Model Design and Construction Management Manual - An Ounce of Prevention Kills Two Birds with One Stone
 
Washington State Model Design and<br> Construction Management Manual

Washington State Model Design and
Construction Management Manual

An Ounce of Prevention Kills Two Birds with One Stone

Contents

Introduction

An ounce of prevention beats a pound of cure.
Thorough preparation makes its own luck. ~ Joe Poyer
One important key to success is self-confidence. An important key to self-confidence is preparation.
         - Arthur Ashe (1943-1993) U.S. tennis player, AIDS spokesman

Very few climbers scale a new peak without thorough research, planning and preparation. Before they ever set foot on the mountain, they will have climbed it in their mind several times over, based on their own research and the experiences of other, successful climbers. Managing a construction contract is not usually as dramatic as mountain climbing, but these same principles apply. If your agency is organized and thoroughly prepared beforehand, you will have fewer problems during the contract.

Detailed, well-designed set of plans and contract documents and sufficient funds to cover the contract amount and a reasonable contingency allowance are basic necessities. Clear policy and procedure documents will provide both accountability and structure for the contract administration team. Team members must be both well-versed in technical aspects of infrastructure construction and familiar with agency procedures and construction administration principles.

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Policies and Procedures

Policy and procedure documents need to:

  • identify needs and allocate resources for administering construction contracts
  • identify agency and consultant construction administration team members
  • establish the relative authority and responsibilities of team members
  • provide for delegation of authority and responsibilities to the construction administration team by elected officials, including levels of commitment authority
  • establish procedures and processes for timely review and disposition of change orders, claims and field adjustments
  • provide for decision making at the lowest level possible for change orders, claims and field changes
  • establish timely and routine meetings with elected officials and/or oversight committees during construction
  • establish timely and routine meetings between the Contractor and the construction administration team during construction
  • provide for 'partnering' concept with the Contractor
  • provide guidance for public relations efforts
  • provide guidance for risk management issues
  • establish report requirements, including frequency and formats

Construction Administration Plans

Links and references to sample construction and project administration plans from Issaquah and Port Angeles are included in Reference Documents, City/County Codes, and Models, as well as commitment authority documents from Poulsbo Puyallup and Issaquah. Definitions and procedures for change orders, field adjustments and contract time adjustments are included in Issaquah and Port Angles documents as well as a MRSC publication summarizing change order policies for a number of cities. Section 1-09.11:Disputes and Claims of the 1998 Standard Specifications for Road, Bridge and Municipal Construction describes procedures to be followed when the contractor files a claim.

A more detailed discussion of procedures for claims, change orders, field adjustments and contract time changes is found in the section on Care and Feeding of Your Construction Contract. Each agency should have its own definitions and levels of approval authority for these items, but for illustration purposes, note the following from Issaquah (Note: 1992 version - may be different now):

Definitions

    Change Order Item. A change order item is a change in the plans and detail sheets or changes in the scope of work which result in additional costs of more than $1,000 per adjustment. This also includes contractor claims and requests for extras or force account work. Additional contract time may or may not be required.

    Field Adjustment. A field adjustment is a change in the plans and detail sheets and/or proposal quantities or minor changes in the scope of work which result in no additional costs or in additional costs of no more than $1,000 per adjustment. This does not include contractor claims for delay or requests for extras or force account work No additional contract time is required.

    Contract Amount. For the purposes of awarding the contract and determining the amount of the performance and payment bonds, the contract amount, or total bid, is the summation of the products of the quantities shown in the proposal by the unit bid prices plus state sales tax or use tax, as applicable. Quantities shown on the proposal and contract forms are estimates only, given only as a basis for comparison of bids. Increases or decreases in the quantity of any bid item in relation to the proposal quantity will occur, based on conditions in the field. Also, quantities may change as a result of changes in the scope of work, as determined by the Public Works Department, Mayor and Council. The basis of payment is the actual quantity measured in the field, multiplied by the unit bid price of the item of work performed.

    Contract Time. Each contract specifies a time of completion of the project, measured in either calendar days or working days from the date that the Notice to Proceed is issued. This time of completion is adjusted, based on weather conditions, weekly. In addition, changes in the scope of work of the project, changed conditions in the field, or delays by the City may be reasonable cause for extensions of contract time.

Approval Authority

    Levels of commitment and authority for changes in the contract documents are established, as follows:

    Mayor and City Council

    The Mayor and City Council will approve all change order and field adjustment items when (if) the weekly estimate of total contract cost exceeds the total contract amount plus 50 percent of the allocated contingency amount. The Mayor and Council, of course, may authorize additional contingency or waive this provision. Change orders that result in cost reductions or savings will be 'credited' against the contingency amount. Regardless of the dollar amount, any change order that changes project functions or affects a policy directive of the Mayor and Council must be approved by the Mayor and Council.

    Project Manager/Engineering Manager

    Change order items and requests by the contractor for extras or force account work must be recommended by the Project Manager and approved by the Engineering Manager. Change order items resulting in additional costs of under $20,000 or requests by the contractor for extras or force account work costing under $20,000 must be approved by the Engineering Manager. When (if) the weekly estimate of total contract cost exceeds the total contract amount plus 50 percent of the allocated contingency amount, change order items and requests for extras or force account work must also be approved by the Mayor and Council. Extensions of contract time due to change order items shall be as approved by the Engineering Manager.

    Project Inspector/Engineer

    The Inspector, with the approval of the Project Engineer, shall have the authority to make field adjustments, except when (if) the weekly estimate of total contract cost exceeds the total contract amount plus 50 percent of the allocated contingency amount. These changes and adjustments shall be duly noted in the daily inspection reports and shown on the weekly estimate of total contract cost. The Project Engineer shall adjust the time of completion, based on weather conditions, and shall report the same to the Project Manager weekly.

Public Relations

Several excellent pointers for construction project public relations are found in "Guarding Against Customer Complaints" (Adobe Acrobat Document 608kb) and "9 Ways to Kill Public Confidence in your Organization and How to Avoid Them." (Adobe Acrobat Document 702kb) While written specifically for LID-financed projects, Chapter Two: Public Relations of the Washington State Local Improvement District Manual, Fourth Edition, also has pointers on public relations.

Risk Management

Risk management for construction contracts can, theoretically, be as simple as making sure that the contractor has insurance in the amounts and types specified and has named the city or county as additional insured. Claims for damage to vehicles and property due to construction activities can then be referred directly to the contractor's insurance agent. In reality, risk management on a construction project is one of the project manager's trickiest tasks. In the event of a major accident, everyone gets sued, regardless of insurance and indemnification clauses and requirements. The trick is to be aware of the contractor's safety program compliance, traffic control plan adequacy and compliance, and general job site safety without appearing to direct the contractor's efforts.

Risk management provisions and insurance requirements for a construction contract must conform to the city or county's overall risk management program. For this reason, the agency's risk manager and attorney should review all contract documents in the very early stages of their development. Examples of model policies, reference documents, links to useful Web sites and a bibliography of MRSC Library publications are linked and referenced in Reference Documents, City/County Codes, and Models

Types and amounts of insurance that the contractor must have in force through the life of the contract are found in Section 1-07.18: Public Liability and Property Damage Insurance of the 1998 Standard Specifications for Road, Bridge and Municipal Construction (WSDOT/APWA). This section has been modified extensively by Division 1-99 to apply to local agencies. Proposed modifications to be included in the 2000 Standard Specifications Division 1-99 are included here.This proposed section requires the contractor to provide insurance coverage three years beyond the end of the contract or termination. Because WSDOT and FHWA will not participate in the cost of this additional insurance coverage, the agency will have to identify these additional costs, if any, and not include them in grant reimbursement requests.

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Filing Systems and Checklists

If you want to be invaluable to your agency, develop fool proof, easy to use filing systems and checklists for construction projects. Conversely, if you want people to question your ancestry, lose or misfile a critical document or overlook a minor, but important, step in the construction management process.

Checklists from WSDOT and Port Angeles are referenced and linked in Reference Documents, City/County Codes, and Models.Issaquah's Project Management Handbook combines flowcharts, checklists, assignment of responsibilities and sample documents. Checklists should allow for a date and project manager signoff at each step or item on the checklist. References to the file where the information is located may also be useful during project closeout. Adaptation of the sample checklists to agency procedures should include any permits or approvals required by the agency or by other city or county departments, as well as other local, state, and federal permits and approvals unique to the agency's location. WSDOT uses two checklists for documentation review, one initially and one as a follow-up.

Standard filing systems from Issaquah and Port Angeles are referenced and linked in Reference Documents, City/County Codes, and Models.Standard filing systems are most effective if all project team members are familiar with the system, but only one or two people actually file the documents. This should minimize mislaid files or mis-filed documents. Make sure that the exact, full file location information appears on each document. Useful also is list of documents that typically are to be placed in each file and pocket.

Between the checklists and standard filing system, there should be very little chance that an important piece of correspondence will get lost. Right? Murphy's Law has not been repealed, however. Many agencies keep a master log of correspondence received and sent, by either department or project. This log should always document the date received or sent, the originator of the correspondence and to whom it was addressed. Other things that can be shown on the log include the project number, file location, date and file location of reply, and a `tickler' for the due date for the reply. An electronic version of such a correspondence log will allow fast and easy searches. There are also several correspondence and file management software packages available, of varying price and complexity.

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Before You Advertise

If your agency is like most, by the time you are ready to advertise, everyone is champing at the bit and wondering why the project is not completed already. The last thing you want to hear is a suggestion that you stop and make one last check on everything before you advertise. But, that's exactly what this section is all about. Even a 'California'-style rolling stop, where you never lose momentum, will be helpful.

In larger agencies, there may be a completely different group that awards and administers the contract. In smaller jurisdictions, award and construction management is likely to be accomplished by the same people who managed the design. Even if your agency uses checklists faithfully, a final check of potential pitfalls and fatal flaws may prevent confusion and claims for delay. Have someone relatively unfamiliar with the project go through the contract documents and files and answer these questions:

  • Have all required permits and approvals been obtained? Of those permits and approvals not yet obtained, are there any which will prevent the contractor from beginning work on the contract soon after the probable notice of award date?

  • Has all required right-of-way been purchased? Have all permanent and/or temporary construction easements been obtained? If not, is there a danger that the contractor may not be able to construct a critical portion of the project within the anticipated schedule?

  • Has the project design incorporated ADA requirements? A requirement for handicapped ramps at intersections and other ADA requirements may be triggered even if the project is an overlay of existing streets or otherwise seemingly innocuous.

  • Have all potentially affected utilities been contacted? Is there evidence that the project designers went the proverbial `extra mile' to identify and resolve potential conflicts between existing utilities and those to be constructed as part of the project? Are there any potential `fatal flaw" conflicts in the overall project design that could lead to redesign and claims for delay?

  • Are federal funds being used for the project? While I-600 has eliminated M/W/DBE requirements in state and locally funded projects, these requirements may still exist for projects receiving direct federal funding. Similarly, federal prevailing wage requirements are different than state requirements. Both sets of requirements have to be followed on the project. Do the contract documents include these?

  • Are the quantities and construction cost estimates reasonable? Have they been independently calculated and/or reviewed by someone other than the person who did the original calculations. Experienced estimators know that there are some quantity takeoffs, such as paving materials, that defy exact and neat calculations and may need a certain amount of contingency for realistic estimates.

  • Are there any obvious errors, inconsistencies or confusing details on the plans or in other contract documents?

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Contract Documents

Each set of contract documents is unique, tailored by the contracting agency to the needs of a specific project of a given size and complexity at a specific location. All sets of contract documents for competitively bid projects however, contain all or most of several components, including:

Contract

Proposal

Addenda

Plans

Standard Plans and Details

Special Provisions

General Provisions

Standard Specifications

Certificates

Affidavits

Performance Bond

Change Orders

Information for Bidders

Advertisement for Bids

Subsurface Boring Logs (if any)

Section 1-04.2, Coordination of Contract Documents, Plans, Special Provisions Specifications, and Addenda of the 1998 Standard Specifications for Road, Bridge and Municipal Construction states:

    "The complete contract includes these parts: the contract form, bidder's completed proposal form, contract plans, contract provisions, standard specifications, standard plans, addenda, various certifications and affidavits, supplemental agreements, change orders, and subsurface boring logs (if any). These parts complement each other in describing a complete work. Any requirement in one part binds as if stated in all parts. The Contractor shall provide any work or materials clearly implied in the contract even if the contract does not mention it specifically.

    Any inconsistency in the parts of the contract shall be resolved by following this order of precedence (e.g., 1 presiding over 2, 3, 4, 5, 6, and 7; 2 presiding over 3, 4, 5, 6, and 7; and so forth):

    1. Addenda,
    2. Proposal Form,
    3. Special Provisions,
    4. Contract Plans,
    5. Amendments to the Standard Specifications,
    6. Standard Specifications, and
    7. Standard Plans.

    On the contract plans, working drawings, and standard plans, figured dimensions shall take precedence over scaled dimensions.

    This order of precedence shall not apply when work is required by one part of the contract but omitted from another part or parts of the contract. The work required in one part must be furnished even if not mentioned in other parts of the contract.

    If any part of the contract requires work that does not include a description for how the work is to be performed, the work shall be performed in accordance with standard trade practice(s). For purposes of the contract, a standard trade practice is one having such regularity of observance in the trade as to justify an expectation that it will be observed by the Contractor in doing the work.

    In case of any ambiguity or dispute over interpreting the contract, the Engineer's decision will be final as provided in Section 1-05.1."

The City of Kennewick has a similar provision in Section 1-4, Conflict of Documents, of its General Provisions:

    "In the event of any conflicting provisions or requirements between the component parts of this contract, the component parts shall take precedence in the following order:

1. The Contract

7. Information to Bidders

2. Change Orders

8. SWSS*

3. Addenda

9. Plans

4. Special Provisions

10. Proposal

5. City of Kennewick Standard Specifications and Details

11. Performance Bond

6. General Provisions

12. Advertisement for Bids

*State of Washington Standard Specifications for Road, Bridge and Municipal Construction, Latest Edition

As a final check before you go out to bid, check your contract document set to male sure that all components required by the size and complexity of the project are included. Also check to make sure there is an order of precedence clause similar to those above.

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Reference Documents, City/County Codes, and Models

Construction Administration Plans and/or Commitment Authorities

Public Relations

Risk Management

Filing Systems and Checklists

Contract Documents
  • Available on loan from the MRSC Library:

    • City of Kennewick - Canal Drive Sidewalks: 99-15 DPW, July 1999

    • City of Kennewick - Morain Street Reconstruction: 99-11 DPW, June 1999
    • City of Kennewick - Standard Specifications and Details, 1999
    • Klickitat County contract document set
    • City of Auburn contract document set
    • City of Issaquah - Contract Documents for Stationmasters House, 1996
    • City of Issaquah - 1995 Maintenance Overlay Project: Contract 95-B, 1995

    The Library has sample contract documents sets for building construction and remodeling projects as well.

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