AIPWP Presentation - Idaho's New CM/GC Statute - What does it mean for local governments?

Idaho’s New CM/GC statute – What does it mean for local governments?

Presented to the Association of Idaho Public Works Professionals Fall 2014 Meeting

Chad W. LamerPartner, Spink Butler LLP

Introduction

Chad W. Lamer, AICP, LEED AP

(208) 388-0245

[email protected]

Twitter @chadlamer

www.linkedin.com/in/chadlamer/

The Idaho Land Law Blog

www.Idaholandlaw.com

Discussion Points

• New CM/GC Legislation

• Changes in Delivery Methods

• CM Representative vs. CM/GC

• Benefits of CM/GC

• Process for CM/GC Selection

• Practice Tips in Selection Process

CM/GC Legislation

• Amendment to the Public Works Construction Management Licensing Act of 1998.

• Idaho Code Section 54-4511.

• Adds definition of Construction Manager Representative (CM).

• Adds definition of Construction Manager/General Contractor (CM/GC).

CM/GC Legislation

• CM/GC statutes similar to Idaho’s approved in the following states:– Arizona– Colorado– Connecticut– Georgia – Kansas– Massachusetts – Nevada– North Carolina– North Dakota– Ohio– Utah– Washington– Wisconsin– Wyoming

Typical CM Project

Public Owner

Construction Representative

A/E Design Professional

General Contractor

Construction Manager Representative

• Licensed Construction Manager.

• Provides construction management services to public owner:

– Preconstruction and Construction.

• Cannot provide equipment or construction services on the project.

• May provide design services if licensed as architect or engineer.

Typical CM/GC Project

Public owner

Construction Manager/General

Contractor

Subcontractor

Subcontractor

A/E Design Professional

Construction Manager/General Contactor

• Licensed Construction Manager.

• Licensed Public Works Contractor.

• Consultant to public owner during both design phase and construction phase.

• Guaranteed Maximum Price Contract.

Differences between CM and CM/GC

• Traditional CM

– Does not hold trade contracts or contractual responsibility for performance of work.

– Selected based on qualifications (same for CM/GC).

– Paid for services rendered with no risk for design or construction overruns.

Differences between CM and CM/GC

• CM/GC

– Selected based on qualifications (same for CM).

– Provides preconstruction services such as budgeting, scheduling, and contract procurement.

– Works with A/E design professionals during design process and construction.

– Manages the competitive bidding process and may submit bids for construction services.

– “At Risk” – assumes risk for construction delivery based on Guaranteed Maximum Price (GMP) contract.

CM/GC Selection: How does it work?

• Selected based on qualifications.

• Selection controlled by Idaho Code Section 67-2320.– Make sure you have criteria available to public.

– Rank applicants in order of preference.

– Negotiate with highest rank (terminate negotiations if cannot reach agreement).

– May request rates, overhead, and multipliers but cannot be used for the ranking of preference.

CM/GC Project Delivery

Challenges Benefits

Increased accountability of CM on budget and

scheduling

Concurrent input from A/E and CM/GC during design

Selection of prime contractor based on

qualifications

Minimizes owner’s risk of cost overruns

Determining what constitutes a change order?

Overcoming appearances of limited competition

Determining when CM/GC will provide GMP for project

Determining GMP

Best Practice CM/GC Selection

• Select the CM/CG early in process.

• Possibly before the A/E design professionals.

• Reasoning:

– CM/GC involved from beginning of design may decrease costs and increase communication between A/E and CM/GC

– Owner benefits from support of budget development, schedule management, and constructability reviews.

Current Projects

• Twin Falls School District

– CM/CG for construction of two new elementary schools, middle school, remodel of one high school.

– $73 Million Dollar Bond

• City of Boise

– Dixie Drain Phosphorous Removal CM/CG Services.

– Awarded to McAlvain Construction, Inc.

– RFQ

Example - City of Boise’s RFQ

Example - City of Boise’s RFQ

Example - City of Boise’s RFQ

Example - City of Boise’s RFQ

Example - City of Boise’s RFQ

Resources

• Association of General Contractors – CM/GC Guidelines for Public Owners

– http://www.agc.org/galleries/events/CM_GC_Guidelines.pdf

• American Institute of Architects –Construction Manager as Constructor Family

– http://www.aia.org/contractdocs/referencematerial/aiab099121

Questions

Chad W. Lamer, AICP, LEED AP

(208) 388-0245

[email protected]

Twitter @chadlamer

www.linkedin.com/in/chadlamer/

The Idaho Land Law Blog

www.Idaholandlaw.com