From any perspective, the ideal construction project is one in which the contractor shows up on your doorstep with the right price and all of his tools, people, and equipment ready to start, and builds exactly what you want for the price you want and finish on schedule. Everyone then goes away, happy as clams. This is the ideal, but it never occurs. The world is a competitive place; to survive, contractors must think competitively in order to win work. They must find a way to complete a quality project for the lowest price. Circumstances can easily derail even the best plans and contractors, but with planning, delays and cost overruns can be minimized. This handbook helps guide the construction manager through the trials and tribulations of selecting, expecting, rejecting, prompting, requiring, and documenting what the contractor produces on the project. Contracts can be written that foresee common problems and provide the construction manager with their resolution. The concepts in Field Guide for Construction Management can help you do just that.

Field Guide for Construction Management

Management by Walking AroundBy Dennis H. Sanders

iUniverse, Inc.

Copyright © 2011 Dennis H. Sanders
All right reserved.
ISBN: 978-1-4620-6712-1

Contents

Dedication.........................................................iiiPreface............................................................viiChapter 1. Purpose.................................................1Chapter 2. Design Phase Services...................................3Developing the Construction Documents..............................3Constructability/Biddability Reviews...............................8Contractor Prequalification........................................11Chapter 3. Bid Phase Services......................................15Pre-Bid Meeting....................................................15Bid Opening........................................................17Chapter 4. Construction Phase Services.............................21Pre-Construction Conference........................................21Project Schedules and Reviews......................................24Contractor Payment Requests........................................40Meetings...........................................................42Managing Resources.................................................54Documentation......................................................56Communications.....................................................57Monitoring of Local Landowner Agreements...........................59Monitoring Project-Acquired Permits................................60Reports............................................................61Monitoring of Construction Documents...............................66Training of Owner's Staff..........................................76Chapter 5. Contract Changes........................................79Request for Pricing (RFP)..........................................80Field Changes......................................................84Change Orders......................................................88Chapter 6. Claims..................................................95Delay Claims.......................................................95Defending against Claims...........................................108Expectation of Proof...............................................110Documentation of Claims............................................111Claim Prevention...................................................113Chapter 7. Dispute Resolution......................................117Chapter 8. Testing, Startup, and Commissioning.....................121Pre-Operational/Functional Testing.................................122System Startup and Integration.....................................127Commissioning......................................................128Chapter 9. Project Completion and Closeout.........................131In Conclusion......................................................139

Chapter One

Purpose

Construction management (CM) can be defined very simply as the art and process of guiding a construction project from the design phase through the construction phase to a finished product. The construction manager's responsibility of guiding a construction project to a successful conclusion for the owner is actually quite simple. It consists of four tasks:

1. Cost: To see that the project is completed without overspending the budgeted amount (the bid amount plus or minus the dollars added or subtracted in change orders).

2. Time: To see that the contractor completes the project per the prescribed contract timetable (the schedule). (The schedule is the contract document time plus or minus time added or subtracted in change orders.)

3. Scope and Quality: To oversee the project construction and make certain that the contractor builds the project in conformance to the project documents (the plans and specifications, including modifications made in change orders).

4. Documentation: The three tasks listed above may change, and the project documents are modified to reflect the following: (1) changed conditions, (2) the owner's needs, and (3) elements improperly designed or missed in the design phase. Tracking and documenting progress and these changes in work description and/or scope is as important as the first three tasks.

Cost, schedule, and/or scope may change during the course of the construction phase. Change orders executed by the construction manager as required by design changes to the project documents may affect any or all of the original baseline values that were in place at the beginning of construction. An owner directive may add scope and/or change the intended design resulting in amended plans and/or specifications. That is why a key task of the construction manager is to track the changes in scope, dollars, and time and see that an accurate accounting is made so that at any time during the construction phase everyone knows exactly what the cost, completion date, and current scope are.

The construction manager accomplishes this task by tracking the project documents and the work being completed. All proposals for cost change are documented. Cost change proposals that are accepted and bound into change orders are logged. Changes that require time added to or subtracted from the schedule are documented so that all parties will know how long the contractor has to complete the project. Changes to the design are documented so that all parties know exactly what is to be constructed. Along with the changes, there are submittals, requests for information, correspondence, meetings, and test results that also must be documented, tracked, and filed for reference.

This book will discuss these issues and other responsibilities of the construction manager and the construction management staff. In the following pages are concrete methods for doing these things with the whys and hows to get the job constructed in budget, on time, and to the quality designed in the plans and specifications. MONITOR:

1. Cost

2. Schedule

3. Scope and quality

4. Documentation

Chapter Two

Design Phase Services

Developing the Construction Documents

Purpose: Understanding the Use of the Contract Documents

The parts of the contract documents held separately are nonentities. When assembled together, they become an active guide to the owner, designer, and contractor. The construction manager is the keeper and enforcer of the contract documents.

The Invitation to Bid

This section of the construction document defines the scope of work, lays out the pricing apparatus for the construction phase of the project, and directs the contractor through the bid process.

The bid bond required with the bid, the bid date and time, the location to turn in bids, and the bid-opening location are all given in this document. The scope of work is defined in this section in terms of bid items that contractor will provide pricing to accomplish. The bid can be requested in several forms, such as:

• Lump sum: The entire project is priced in one number.

• Unit price: The various components of a project are priced per unit—cy, lf, ea, lb, ton, ton mile, and so on. Usually an estimate of the total quantity is given and blanks are provided for the unit price and an extended total price. The extended price is calculated by multiplying the unit price times the estimated quantity. A total price is obtained by adding all of the extended prices to a total.

• Cost plus: Unit costs are provided for labor and equipment, with a maximum markup for overhead and profit added to establish a unit price for each category. Materials are provided at cost plus a standard markup.

• Cost plus a fixed fee: Costs are paid at base rates, including overhead, and a fixed percent is added.

There are other delivery methods for estimates of cost. Most bids are delivered lump sum or unit price.

It is important to go over this section of the bid document in the pre-bid conference. This section is where contractor will acknowledge having received and reviewed all addenda and his due diligences to gather information for bid preparation.

The Agreement

This section is the actual terms and conditions of the contract wherein the contractor agrees to enter into a contract and signs the agreement with the owner to accomplish what is defined in all of the other sections of the construction contract document. This section should contain a defined, detailed scope of work, critical dates, and the accurate dollar amounts for which the contractor intends to accomplish the work.

In other words, it is the scope, schedule, and cost for the project. This section binds all of the sections together so all of the construction documents are considered complementary. Signature pages for the owner and contractor are also found in the agreement.

The General Specifications

These are the construction manager's tools. Just as a carpenter uses a hammer to drive nails, the CM uses the general and supplemental conditions to establish and enforce the requirements of the construction phase of the project.

The purpose of the general and supplemental sections of the project documents is to establish the rules under which the stakeholders of the project will operate together to accomplish the common goal of constructing the project that the owner directed the designer to create on paper. The project documents are the guide and plan to deliver a constructed project for a fair price. The general conditions (division 00) of the project document give general and owner-specific policy guidance regarding administrative matters pertaining to the construction of the project.

The supplemental conditions section of division 00 reflects specific policy guidance that modifies the general conditions to reflect specific needs of a specific project. Division 00 also contains the bid documents for the project, including scope of work, bid date and time, insurance requirements, and bond requirements. It also includes the bid form and agreement forms required to be submitted with the bid. General requirements (division 01) may also contain general performance specifications that relate to the project performance overall. The technical specifications (divisions 02–48) define the hard goods, such as concrete, grading, structural products, machinery, and equipment and give specific direction as to the construction and delivery of those goods.

The general and supplemental sections of the specifications are the tools of the construction manager so he or she may be asked to write or assist in writing all or some sections of either or both of them. Always review the sections pertaining to changed field conditions, terminations, order of precedence, submittals, claims, owner's responsibilities, contractor's responsibilities, and owner representative's responsibilities, payment, contract change, retainage, bonds and insurances, safety, and project construction schedule. The construction manager must understand how the bid and construction contract format were established. The construction manager and staff must know these sections very well, better than anyone else on the project. The construction management staff will rely on these sections of the contract document as the basis for administering the construction contract. The construction management staff will "work for" the project document. That is to say the construction contract documents must guide the construction manager in all decision making because they are the binding contract language.

There will be times when the designer, owner, or contractor may not agree with a request, a change order, a piece of equipment selection, or some other action taken by one party or the other. All decisions and all direction must match with the document or one party or the other will have cause to take legal action. It is the construction manager's responsibility to see that there is no cause for such action by reminding the parties of the language and direction given in the documents.

While reviewing or writing any section of the general and/or supplemental specifications, the reviewer/writer must understand that federal and state law and county and municipal ordinances govern and are the bases for much of the language in the document. General construction practice and current technology will also be considered when writing the specifications. Tradition, standard practice, local custom, and accepted practice may be considered but must not be the guiding principles of the document. If law, ordinance, regulation, technology, or standard practice change, then the document must be reviewed and possibly modified to reflect the change(s). However, the project document requirements may be more stringent than the guiding documents. Then, except in cases that are unfair to the contractor, the project document will be precedent to law or ordinance.

The Supplemental Specifications Modify the General Specifications

The general specifications are usually a standard set of "boilerplate" documents that have been produced to guide all sorts of projects, perhaps even vendor purchases. The general specifications may have been produced by a governmental agency, such as the federal, state, or municipal government for which you may be contracted. They may be a standard written by a guiding organization such as AIA or EJCDC. The supplemental specifications make changes to the general specifications to address specific needs, concerns, and issues that are pertinent to the specific project for which they are written. A good example would be the following.

If the standard federal military general specifications were your governing specifications for federal acquisition regulations (FAR), they do not address specific water/wastewater regulations that may vary from location to location, so the supplemental specifications would have to address those specific issues. Locally written general specifications do not address requirements when federal funds are included in projects, so such things as the Davis Bacon Act must be spelled out in the supplemental specifications.

The construction manager may find him/herself dealing with strict schedule considerations, payment requirements, regulations, or needs regarding working times, noise, light, work periods, and so on. All of these and any other specific issues that may or may not be addressed in the general specifications must be addressed in the supplemental specifications.

When developing the general and supplemental specifications:

• Understand that the supplemental specification language modifies the general specification.

• Know the state and local laws and regulations that govern.

• Make the language clear and unambiguous.

• Use strong, fair language to guide the path should issues develop.

• Know that the contract documents govern all project decisions.

Constructability/ Biddability Reviews

The construction manager should have the most knowledge regarding construction methods and practices outside of the contractor's house. The goal of these reviews is to help ensure:

• Consistency

• Completeness

• Clarity

in the project bid documents. It makes the construction manager the most likely member of the project team to review the plans and specifications for problems that may arise during the construction phase. This is most especially true if the construction manager has experience in the construction side of the business. The contractor views most aspects of construction differently than designers or owners do. Generally, contractors have experience with several different designers and must have a broader understanding of the industry as a whole. Contractors do not conceive or interpret; they look at the design they are given in pieces then put the pieces together to develop a method, schedule, and cost. Therefore, the construction manager should be invited to review the construction documents for constructability and biddability issues. There may be more than one review. Very often a review and comment is requested at the 30 percent and/or 70 percent design stages and then a final review and comment at the 90 percent stage.

Such issues as material availability, product suitability, owner direction, soil conditions, equipment accessibility, maintenance access, site storage and lay-down area, scheduling, community impact, labor availability, cost reduction opportunities, and completeness of the design should be included in each constructability review. Subsequent reviews should also include checking to see that previous review comments were addressed properly and adequately. On projects regarded as time critical, make sure the specified scope can be completed within the desired time frame by preparing a baseline construction schedule. Often space constraints will allow only small crews or a limited number of crews to work in a project area. This condition may be cause for concern if the schedule requires large numbers of man hours to be spent in a short duration. The reviewer needs to be careful to only base the review on general construction practices, not on specific knowledge of unique means and methods, unless asked to do so. Specific problem areas of the construction may require certain skills that are not normal or usual. These requirements need to be pointed out to the team so they can be addressed in the process of design.

An example of this might be pile driving. Pile driving with a diesel hammer is noisy and dirty work. There must be ample lay-down area for the piles and time allowed for welding, mobilization, and demobilization. Vibrations caused by the operation may affect nearby structures. If this operation is to be accomplished in a residential neighborhood, it can cause real problems for the folks who live close to the work, so the team will have to do substantial PR work ahead of the pile-driving activity or require alternate methods in the bid document. Upon learning of the lay-down requirements, noise concerns, and vibration concerns, the design team may select a different method of foundation support, such as auger cast piles or caissons.

Look for information in the specifications that give detailed, variable information that is required to build certain aspects of the project. This variable information, such as rebar clearances, can be shown in table format. Other information that might be shown this way is rebar lap, door schedules, paint and/or coating schedules, concrete wall and floor finish schedules, and epoxy usage and depth schedules

Alert the designer if an equipment access will cross a public thoroughfare. The road may not be in the construction site but may be unavoidably impacted and require rehabilitation or total reconstruction because of the weight of the project vehicles and/ or activities of the equipment. Be sure that the owner gets what he wants. Often times the roadway owner has had problems and wants to avoid the pitfall again. The issue may have been communicated but not forcefully, so the designer may not have picked it up. It is important the construction manager pays attention to these issues so he can assist the designer to give the owner the best product. By catching such problems that may occur further along in the project may be avoided.

(Continues...)

Excerpted from Field Guide for Construction Managementby Dennis H. Sanders Copyright © 2011 by Dennis H. Sanders. Excerpted by permission of iUniverse, Inc.. All rights reserved. No part of this excerpt may be reproduced or reprinted without permission in writing from the publisher.
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