What Do NYC, Design-Build, and Incarceration Have in Common?
Project collaboration is inherent in the construction industry and is far from an innovative concept. Architects, designers, engineers, and builders have had to co-exist in the same ecosystem for decades, but now the Design-Build delivery method highlights this effort. The end goal is the same but the functions within the construction organizations need to operate a bit differently and some developers need to adjust their management tactics to be able to survive. In New York City, this method has not had the most welcomed roll-out, but the Governor is now exercising Design-Build on one of the City’s most controversial developments.
With the traditional Design-Bid-Build delivery method, the Owner must navigate between two separate contracts which often creates a rival relationship between the designer and the contractor. If something goes wrong, or an unforeseen circumstance requires changes, the designer and contractor blame one another for the cost overruns and/or schedule changes, often leading to litigation and delays which add to the project cost.
With the Design-Build delivery method, the Owner manages only one contract with a single point of responsibility. The designer and contractor work together from the beginning, as a team, providing unified project design and controls to fulfill the Owner's schedule and budget. Any changes are addressed by the entire team, who collaborate, problem-solve and innovate, which is preferable to excuses leading to overruns. While single-source contracting is the fundamental difference between design-build and the old ways, equally important is the culture of collaboration fixed in design-build.
“The concept of a single point of responsibility can seem very straight forward, but you have to understand what it means so that you can manage the expectations and work with the Owner to properly allocate the risks”, said Lisa Washington, Executive Director of the Design-Build Institute of America. For contractors to effectively develop a design-build program, they will have to assess their risk appetite and mentality when it comes to management.
Some questions contractors should consider include the following:
Did I thoroughly vet my partners and choose wisely based on their experience and willingness to work as a team?
Is the contract payment schedule based on the CPM? Is it a 3D CPM? 4D?
Is the language within my subcontracts adjusted to the design-build payment schedule so I do not need to float an exorbitant amount of funds?
Have internal processes been created to streamline changes of scope now that the Owner is less willing to entertain change orders?
What is my risk tolerance and how does it relate to my profit margin?
Does my organization adapt well when collaborating with others? A good example would be to analyze how your organization treats value engineering.
The biggest challenge is administering the design team while adhering to the time-sensitive schedule contractors are routinely used to - increased production equals increased profits. The idea that the design is being built nearly in parallel is a concept that requires tremendous coordination from all parties.
Moving forward, agencies around the country are increasingly adopting the Design-Build delivery method. On December 31, 2019, New York Governor Andrew Cuomo signed the New York City Public Works Investment Act, which authorizes some New York City agencies to use the Design-Build delivery method for certain capital projects. This includes the City’s Department of Transportation and the Department of Design and Construction. The law takes effect immediately, and, starting on June 30th, each agency that has issued a design-build contract must submit an annual report which includes a description of the contract, information about the bidding process, the total cost, how much money the agency/department saved by using design-build and how much of the contract went to minority and women-owned businesses (M/WBE).
A highly publicized example of design-build execution in New York City is the new jails that will be constructed after Rikers Island closes. In 2019, the City Council approved an $8 billion plan to close the compound and build four new smaller jails.
This is part of a unique opportunity to build a smaller and more humane justice system which includes four facilities, offers better connections to and space for families, attorneys, courts, medical and mental health care, education, therapeutic programming, and service providers.
The Department of Design and Construction issued a Request for Qualifications (RFQ) for design-build teams that will construct the new borough-based jails (Borough-Based Jails Program) in Manhattan, Brooklyn, Queens, and the Bronx.
Procurement for all work will take place through a two-step process - submittal of a Statement of Qualifications (SOQ) in response to an RFQ followed by submittal of a Proposal by short-listed vendors in response to a Request for Proposals (RFP). The SOQs will be evaluated to generate short-lists of firms that are considered qualified to respond to the follow-up RFPs. Up to three vendors will be short-listed per project. Responses to the RFPs will then be evaluated and will lead to contracting with the Design-Build teams that will design and construct the four facilities.
The design process will be transparent and public, to ensure the highest quality results for the City are produced, before, during, and after the Design-Build contracts are awarded. District workshops will give local communities a chance to provide their views and input. Technical professionals, including experts on urban design and planning, architectural design, building performance, and justice reform, will provide feedback on design guidelines and other specifications. The entire project is intended to be completed by 2026.
With Consideration,
R. Chowdhury