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CHAPTER 7
Professional Services
A wide range of entities provide professional services, including, but not limited to, architec-
tural and engineering firms, law firms, concessions consultants, financial services firms, and real
estate professionals. This group of providers is distinguished from Contract Services providers in
that many of the consultants staffing the provider firms are licensed and/or have advanced edu-
cational degrees.
Successful professional services contracts have a clearly understood and well-defined scope of
services, a realistic timetable to perform the services, and timely compensation to the service
providers. A scope should be defined for each contract, clearly defining the services to be per-
formed by the services firm. The scope should be accompanied by a schedule/timetable and a list
of deliverables and be contained in a separate exhibit of the contract. The mantra of professional
services firms is to finish on time and within budget. The airport facilitates successful delivery of
services by providing well-managed contract administration.
To maintain control of the budget and expenditures, a list of reimbursable expenses should
be defined in the terms of the contract. These may include, but are not limited to, travel, telephone
calls, overnight delivery expenses, and reproduction expenses.
7.1 Critical Issues in Professional Services Agreements
There are a number of critical issues for an airport sponsor to address in professional services
agreements. These issues are discussed individually in the following sections.
The critical issues in professional services agreements are as follows:
· Designated representatives (both parties)
· Project deliverables
· Additional services
· Relationship of parties
· Ownership of documents
· Schedule and excusable delays
· Budget
· Confidentiality
· Warranties/errors and omissions insurance
· Professional certifications
· Payment terms
· Assignment
· Place of work
· Termination provisions
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54 Guidebook for Developing and Managing Airport Contracts
7.1.1 Designated Representatives (Both Parties)
The service provider and the airport should designate the project managers or key project
leadership and the liaisons for both parties. The project managers should be identified by name
and title, and the procedures for replacing them should be outlined.
7.1.2 Project Deliverables
Project deliverables include documents, drawings, and any other forms of work product to be
developed under the Scope of Services to be performed. Deliverables should be described in
terms of the format to be provided (e.g., electronic, hard copy, color or black/white, and CDs),
method of delivery, and relationship to the project schedule.
7.1.3 Additional Services
When a service provider performs well and the airport establishes a good working relation-
ship, the airport may want the provider to perform additional services related to the original con-
tract, but going beyond the services defined in the Scope of Services. This provision allows the
airport to expand the scope and increase the compensation to the service provider.
See CRP-CD-81 (enclosed herein), Appendix to Chapter 7, Professional Services, for excerpts
from the CHS Consultant Services Agreement for example of provisions regarding procedures
for authorizing and paying for additional services.
7.1.4 Relationship of Parties
The contract should contain language that specifies that the service provider is not an
employee of the airport, but is an independent entity.
See CRP-CD-81 (enclosed herein), Appendix to Chapter 7, Professional Services, for excerpts
from the IAH Concessions Services Agreement for an example of provisions for defining a rela-
tionship as an independent contractor.
7.1.5 Ownership of Documents
The airport sponsor should have a provision that it is the owner of the work products, deliv-
erables, and all documentation produced under the terms of the contract.
See CRP-CD-81 (enclosed herein), Appendix to Chapter 7, Professional Services, for excerpts
from the MWAA, IAH and CHS Consultant Services Agreements for example of provisions
regarding ownership of the work product.
7.1.6 Schedule and Excusable Delays
The schedule provided under the contract is typically based on time estimates to which both
parties agree. Delays may occur that are out of the control of the service provider and may result
from the airport's delay in providing required inputs or task orders. A well-written agreement
provides for these types of delays.
See CRP-CD-81 (enclosed herein), Appendix to Chapter 7, Professional Services, for excerpts
from the IAH Concessions Services Agreement for example of provisions regarding schedule and
excusable delays.
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Professional Services 55
7.1.7 Budget
The project budget is typically found in an exhibit of the Professional Services contract. It com-
prises the estimated costs for labor, materials, and reimbursable expenses based on the schedule
of work. The budget may have been developed as a response to an RFP or negotiated/modified
after the award of the contract. The budget is the basis for billings and compensation to the ser-
vice provider and should incorporate as much detail as can be reasonably tracked by the spon-
sor's staff.
7.1.8 Confidentiality
The professional services contract should contain a provision of confidentiality with regard to
information the airport provides to the contractor and also with regard to the work product.
See CRP-CD-81 (enclosed herein), Appendix to Chapter 7, Professional Services, for excerpts
from the IAH Concessions Services Agreement for example of provisions regarding confiden-
tiality of information.
7.1.9 Warranties/Errors and Omissions Insurance
Errors and omissions insurance is a requirement for architectural and engineering services
because of the potential liability associated with such work. Risk management staff should be
involved in determining the indemnification, insurance, and errors and omissions coverage for
other Professional Services agreements.
7.1.10 Professional Certifications
The contract should specify that all necessary professional certifications and licensing require-
ments should be met by the contractor in accordance with local, state, and federal regulations.
See CRP-CD-81 (enclosed herein), Appendix to Chapter 7, Professional Services, for excerpts
from the JAX Ground Handling Agreement for example of provisions regarding compliance
with licenses and permits.
7.1.11 Payment Terms
Many professional services contracts involve a monthly billing cycle with payment due within
a specified number of days. Sponsors should seek terms that are favorable, yet fair, and do not
adversely affect the airport's cash flow.
See CRP-CD-81 (enclosed herein), Appendix to Chapter 7, Professional Services, for
excerpts from the IAH Concessions Services Agreement for example of provisions regarding
payment terms.
7.1.12 Assignment
Assignment of a professional contract should be prohibited without consent of the airport. The
provider was selected on the basis of its qualifications and experience and should not be allowed to
freely assign the contract to another entity. In instances where the contractor is acquired by another
firm while a contract is in progress, the airport should consider assignment only if the same per-
sonnel remained assigned to the project or if comparable or superior staff from the acquiring firm
is assigned.
