Construction

Sample Evaluation
Special Experimental Project No. 14 (SEP-14)
Alternative Contracting
June 2006

State Department of Transportation Initial Report
For SEP (Special Experimental Project) 14

Design-Build Contract for the Replacement of the US 1/601 Southbound Bridge Over the Wateree River
Kershaw County, SC
State DOT File # 28.709
August 14, 1997

Initial Report For SEP (Special Experimental Project) 14
Design-Build Project for the Replacement of the US 1/601 Southbound Bridge Over the Wateree River in Kershaw County, File No. 28.709 (PIN 18062)

A. Introduction

The State Department of Transportation (State DOT) submits this initial report under the provisions of Special Experimental Project No. 14 (SEP 14) for the use of innovative contracting practices.

A committee was appointed to develop the necessary documentation, solicit proposals, and select a design-build contractor. A design-build contract has been executed for the replacement of the US 1/601 Southbound Bridge Over the Wateree River located near Camden, Kershaw County. This initial report includes a brief scope of the design build project, a brief history of the contracting process, effects on the bids received, estimates of cost and time savings, lessons learned thus far, and industry reaction to the process.

B. Scope

The scope of work for this project includes the design and construction of the bridge identified in the Introduction above. The design work includes the required surveys, geotechnical work, hydraulic analyses, scour analyses, and superstructure and substructure design including seismic analyses. The design will meet the requirements of State DOT Design Memorandums and AASHTO Standard Specifications for the Design of Highway Bridges Sixteenth Edition, 1996 and subsequent Interim Specifications.

Construction includes the removal and disposal of the existing bridge structure along with any accumulated debris, all necessary foundation work, substructure work, superstructure work, excavation, roadway approach work, and erosion and sediment control work items. Construction engineering, including quality control is the responsibility of the Contractor. State DOT has the right to review design plans and construction activities including making independent tests of materials.

C. History

The State DOT advertised for the replacement of this bridge through a Request For Proposals (RFP). State DOT provided the RFP to all interested parties at no cost. An information package including design memoranda, special provisions, project scope, location plan of the bridge, and existing bridge plans was provided for a fee of $600. As part of the proposal, each contractor submitted a preliminary plan of the bridge. The preliminary plans showed plan and elevation views of the bridge including the span arrangements, typical sections through the superstructure, and elevations of the proposed substructure units. The contractors' proposals also contained the time required to complete the project and restore traffic to the bridge as well as the cost of the project. Their proposals required two parts, a Technical Proposal and a Cost Proposal. The Technical Proposal consisted of design and construction, management, and project schedule. The Cost Proposal consisted of the proposed cost of the bridge by phases: Insurance and Bonds; Design; Mobilization; Removal and Disposal of Existing Bridge; Substructure Construction; Superstructure Construction; Roadway Approach Construction; Traffic Control; QC/QA including Testing and Inspection; Warranty (Five Years: Bridge Deck Joints and Bearings); and Total Project Cost. An Owner's Contingency Fund in the amount of $300,000 was established. The maximum Project Cost is the sum of the proposed cost plus the $300,000 from the Owner's Contingency Fund.

All Technical Proposals were evaluated prior to opening the Cost Proposals. The Technical Proposals were scored first. This score was based upon technical design, experience and qualifications of the Proposer including the Design Engineer and major subcontractors, and the time of completion. The Proposer could have been requested to make an oral presentation of their Technical Proposal and answer any questions the State DOT may have with respect to the Technical Proposal before the Technical Proposal is scored. However, the Committee did not use this option.

Technical scores were based on a scale of 0 to 100. The relative weight of each criteria was set based upon the individual project requirements. The following criteria was considered in determining the Technical Score:

1. Technical Criteria Plan Evaluation
   1. Innovation of Design/Constructability
   2. Future Maintenance

   Maximum Score: 20

2. Management Criteria
   1. Quality Control Plan
   2. Demonstration of Ability to Perform Work
   3. Applicable Experience of Team
   4. Management Approach
   5. Financial Condition

   Maximum Score: 45.

3. Project Schedule
   1. Time duration of traffic detour (24 months maximum)
   2. Project completion time (27 months maximum)

   Note: Schedules exceeding the maximums given in a. or b. are considered non-responsive.

   Maximum Score: 35

Initially, a Technical Proposal receiving a score from the Selection Committee of less than 75 points was not to be considered for further evaluation. However, the Committee changed this score to 70 as the minimum. After the Technical Proposal score was calculated, the Project costs was reviewed. The Selection Committee did make adjustments in the proposed Total Project Cost based on waiver of the Owner's Contingency. A Composite Score was calculated as follows:

Composite Score = Total Project Cost / Technical Score

The Selection Committee prepared and made a a recommendation to the State DOT Executive Director to start negotiations based on the order of Composite Scores of Proposers.

The State DOT Executive Director approved the order of negotiations and immediately the State DOT offered to start contract negotiations to the Proposer with the lowest Composite Score. However, if the parties were unable to execute a contract, the State DOT could offer the contract to the Proposer with the next lowest Composite Score. This was not necessary since successful negotiation produced a contract with the first Proposer.

A brief outline of the project milestones is given below:

• Advertise RFP February 6, 1997
• Pre-proposal Meeting February 28, 1997 10:00 AM
• Deadline for State DOT to receive questions in writing - March 7, 1997 12:00 Noon
• Deadline for State DOT to mail response to written questions - March 14,1997
• Submittal of eight (8) copies of Proposals - March 26, 1997 12:00 Noon
• Recommendation to State DOT Director - April 11, 1997

D. Bids Received

Six (6) contractors submitted proposals for this project. The number of proposals received were considered close to the same number of bids which would have been anticipated using the traditional design-bid-build contracting method. The costs proposed for the work ranged from a high of $17,720,000 to a low of $7,856,000. The completion times proposed ranged from a high of 821 days to a low of 457 days. The tabulation below shows the cost and time for each proposal submitted. The time required for the duration of the detour is shown separate since this was identified as a priority.

* Did not meet minimum technical score

E. Time And Cost Saving

Time

The Design-Build method of contracting appears to have saved significant time when compared to the time estimated for the traditional design-bid-build method of contracting. The time savings will be more accurately determined at the end of the project when the actual construction time will be known. The estimates of time shown below for both the Design-Build and the traditional design-bid-build methods of contracting show a time savings of 647 days, approximately 53.6 % of the time required for the traditional method.

State DOT Traditional Design-Bid-Build Method Time Estimate:

• Design and Plan Preparation - 180 days
• Advertise, Bid and Award Construction Contract - 60 days
• Construction Time - 967 days
• Total Project Time - 1207 days

Design-Build Method Contract Time:

• Design, Plan Preparation, and Construction Time - 457 days
• Review, Select and Execute Contract - 103 days
• Total Project Time - 560 days

Time Savings - 647 days

Cost

While the proposals varied widely, the cost proposed by the selected contractor represents a substantial savings when compared to the estimated cost of the project using the traditional design-bid-build method of contracting. The cost savings can be determined more accurately at the end of the project at which time the actual construction cost will be known. The savings is estimated to be at least $1,261,000 or 13.8% of the cost required using the traditional method.

State DOT Traditional Design-Bid-Build Method Cost Estimate:

• Preliminary Engineering $525,000
• Construction $7,852,000
• Construction Engineering and Contingencies (10%) $785,000
• Total Project Cost $9162,000

Design-Build Method Cost Estimate:

• Preliminary Engineering (State DOT) $20,000
• Design, Construction and Construction Engineering $7,856,000
• Construction Monitoring (State DOT) $25,000
• Cost Sharing Provision of Contingency Fund $0
• Total Project Cost $7,901,000

Cost Saving $1,261,000

F. Lessons Learned

Since this is the second Design-Build project that the State DOT has performed, the Department has taken into consideration the lessons learned from the first Design-Build project. This knowledge and insight of another similar Design-Build project was particularly valuable. The Committee was very satisfied with the requirement that the Proposers submit a separate Technical Proposal to evaluate before looking at the Cost Proposal. We are certain that new lessens will be apparent during the course of the project and cannot be fully evaluated until the project is complete.

G. Industry Reaction

Interest in the Design-Build project has been strong. Forty (40) firms requested the RFP, twelve (12) firms purchased the information package, forty four (44) individuals representing contractors and designers attended the pre-proposal meeting, and six (6) firms submitted proposals.

The reactions of both the construction and design industries have been mixed as were the first Design-Build project. While there has been a high degree of interest in this project from the construction industry, there is a concern among contractors as to the Design-Build method becoming the standard method of contracting. Their concerns also include 1) the additional work required to prepare a proposal, 2) the risk of not having definite plans and quantities at the time of bid, 3) the added responsibility of construction management including quality control, and 4) the inclusion of the committee's judgment of the relative qualifications of the contractors in the selection process. The selected contractor has been very supportive of the contract development process and has eagerly anticipated the start of construction. The contractor demonstrated his confidence in this project by beginning design work and permit acquisition at his risk prior to execution of the contract. Reaction from the design industry has generally been positive. Many firms see this as an opportunity which may not have otherwise been available to provide engineering services for a transportation project. Concerns expressed by designers are 1) competition among design firms is limited to the number of contractors interested in the project, 2) the design firm is a subcontractor and thus must try to please the contractor and the DOT while maintaining high engineering standards, 3) the major cost of preparing a proposal falls to the designer in the form of engineering and plan preparation, and 4) the designers reputation is linked to the contractor's performance and in the case of poor performance, could jeopardize the designer's future ability to compete for work with the DOT.

H. Summary

The use of the Design-Build contracting method has accomplished the purposes stated in the Work Plan of producing a savings in time and cost for the replacement of the bridge over Wateree River, and allowing State DOT to explore this innovative contracting method. While our initial opinion is that the Design-Build contracting method has been successful for this project, some aspects of this project cannot be fully evaluated until the project is completed. The lessons learned in this project will prove valuable and directly applicable to future Design-Build projects in the state.