By Mark Holan, editorial director, ARTBA
Transportation construction risk allocation and alternative delivery methods, especially design-build, are at a crossroads, Florida Transportation Builders’ Association President Ananth Prasad said in introducing an Oct. 20 panel on the topic at ARTBA’s national convention. The session featured prominent voices from the public agency, contracting and design sectors. It was the latest in a series of activities ARTBA is conducting to tap member expertise on risk issues.
Kraemer North America President Dave Zanetell said too much design-build risk has been shifted to the private sector and needs to be “retrenched” for a more proper balance. “Industry needs to be more disciplined about pushing back on price or scope and outcome,” he said.
Zanetell also said that the term “design-build” has become so ubiquitous that it “doesn’t get treated with the respect and discussion it deserves.” He added that design-build is not right for every project.
At the same time, “Design-build is an important and essential delivery method that’s here to stay,” said AECOM Senior Vice President Kevin Cornish. RS&H Senior Vice President Chad Critcher sees a trend toward use of the progressive design-build delivery method, which seeks to mitigate or eliminate problems along the way and keep the finished project closer to the original price and design expectations.
“Communication is important, especially early in the process,” Critcher said. Designers, contractors, and owners need to “get closer to each other’s responsibilities because it’s more difficult to untangle problems later in the process.”
Cornish and Critcher have been co-leading a group of members from ARTBA’s Planning & Design Division in developing draft recommendations for risk allocation in the design-build setting. Other ARTBA divisions are now reviewing these principles and providing feedback.
Panelist Michael Vecellio, vice president of The Vecellio Group, Inc., and outgoing president of ARTBA’s Contractors Division, emphasized the importance of common ground rules, more information – such as geotechnical studies – provided by owners early in the process, and better balancing of liability among the parties. In addition, he suggested, “Everybody needs to be graded on what they are doing,” including those managing the project on behalf of the owner.
Louisiana Department of Transportation & Development Secretary Dr. Shawn Wilson said that in recent years, design-build has been applied to numerous “mammoth-sized projects,” which carry similarly giant risks. He suggested using design-build on appropriate smaller-scale projects, but in quantity. Wilson proposed exploring those under $150 million for that purpose.
ARTBA does not advocate for the use of design-build or any other particular delivery method on the state and local level. However, the association does facilitate educational sessions such as this panel, so that members are better prepared for their own dialogues on these topics.
In a subsequent convention session, ARTBA’s new Construction Forum hosted a review and series of small group discussions about the draft risk recommendations. For more information on this continuing process, please contact one of ARTBA’s membership division managers: Rich Juliano or Allison Klein.