Guidebooks for Post-Award Contract Administration for Highway Projects Delivered Using Alternative Contracting Methods, Volume 2: Construction Manager–General Contractor Delivery (2020)

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27 7.1 Introduction This chapter discusses agency administration of the CM-GC construction phase and presents tools that contribute to successful construction. This chapter addresses • CM-GC construction process overview and • Construction phase contract administration tools. The CM-GC has in-depth knowledge of the design intent and the design itself due to partici- pating in the design and preconstruction phases. The agency’s contract administration during construction should ensure that adequate construction progress is being made and that quality requirements are being achieved. Work must be measured and paid for, and any change orders or disputes must be resolved. CM-GC projects are often fast-tracked, so the agency should be prepared with an adequate assignment of internal or consultant staff to participate in contract administration activities during construction. 7.2 Construction Manager–General Contractor Construction Process Overview CM-GC construction administration shares many similarities with the traditional D-B-B pro- cess. Ultimately, the same technical requirements are met using the same basic materials in both delivery methods. State DOTs can choose to administer QA-QC processes in the same manner as D-B-B, but they can also choose to shift some traditional QC roles to the contractor. The primary difference in construction administration revolves around the use of discrete work packages to facilitate faster construction. Administration of these work packages can be more demanding compared with D-B-B processes. Key agency activities in the construction phase include • Manage legal relations. • Manage public relations. • Manage materials. – Sample and verify materials. – Test materials. – Certify materials. • Control and inspect work. – Inspect work for conformance to plans and specifications. – Document the daily work, compliance, and quality. – Manage the request for information process. – Manage the submittal process. – Monitor CM-GC and QA-QC. C H A P T E R 7 Construction Phase Administration

28 Guidebooks for Post-Award Contract Administration for Highway Projects Delivered Using Alternative Contracting Methods – Manage nonconformances. – Review nonconformance design solutions. – Review completion of punch list items. • Review potential additional scope. – Receive shared risk contingency. – Review state DOT risk contingency. • Execute supplemental agreements. – Receive change orders. – Estimate cost and time adjustments. – Negotiate cost and time adjustments at site level. – Review change orders. – Execute change orders. • Resolve disputes. • Measure progress, and pay contractor. – Receive contractor invoices. – Review payment invoices. – Execute payments. • Acquire project completion documentation. • Ensure that as-builts are being developed by the engineer and CM-GC. 7.3 Construction Phase Contract Administration Tools In this phase, the agency seeks to facilitate construction progress. At this stage, the CM-GC firm should have a thorough understanding of the project. A significant portion of the innovative ideas should have been vetted during preconstruction. However, additional innovation can still originate from subcontractors and suppliers who are asked to propose ideas for portions of the work. A key goal of the construction phase is ensuring quality. The agency can encourage qual- ity construction using tools such as electronic data management and quality-based incentives. Some previously discussed tools can add value to the construction phase. For example, 8 CM-GC–Specific Partnering strengthens relationships and builds communication channels that can help the agency, engineer, and CM-GC firm work through issues that arise during con- struction. 9 Continuity of Team Members carries forward project knowledge from the design phase to the construction phase. 11 Permit Commitment Database serves to preserve commit- ments that the project team made during the design phase to help ensure that permit commit- ments are not forgotten or violated during construction. 20 Delegation of Authority facilitates timely decision-making so construction can proceed without unnecessary delay. For construction changes and construction as planned, 18 Open-Book Estimating provides the agency with a mech- anism for checking cost competitiveness and construction progress. Typically, the public is not familiar with the CM-GC process and potential benefits. The 19 Public Announcements tool can help inform the public about the specific benefits CM-GC is bringing to the construction project. A number of tools relate specifically to promoting quality during construction. Many agencies are able to use their standard QA-QC processes on CM-GC projects, especially with noncom- plex projects. However, a number of tools have been developed to take advantage of oppor- tunities that CM-GC delivery offers. A quality program can be adjusted to the context of a specific project using 29 Contractor Involvement in Establishing QC Standards. Additionally, 28 Contractor-Controlled QC Testing puts the responsibility for QC testing into the hands of the CM-GC—or a third party the CM-GC contracts with—instead of the agency itself. These options must be in compliance with 23 CFR 637 on federally funded projects. This added responsibility can keep the CM-GC more alert to QC requirements and test results so that construction processes can adjust quicker to quality needs. Construction projects can generate

Construction Phase Administration 29 a lot of data and paperwork, especially related to quality. The 30 Real-Time Electronic QM Information tool can be used for efficient data management and record tracking. The 31 Wit- ness and Hold Points tool helps the project team avoid construction errors or rework by bring- ing team members together at critical points to witness the work completed up to that point before continuing with the work. Meeting or exceeding construction quality is an important task for a CM-GC firm. Any of the aforementioned tools that address quality could be part of a broader quality program. Additional guidance on quality programs can be found in NCHRP Report 808 (Molenaar et al. 2015). Throughout construction, the CM-GC will submit invoices for completed work. Having a structured pay request process helps the agency receive the necessary information in the appro- priate format for efficient reviews, and it helps the CM-GC get paid promptly. The 32 Payment Checklist tool is used to identify which party is responsible for each task in the payment process. The 7 CM-GC Management Fee Table tool identifies the costs to which fees are tied. Some of the tools used by the agency in the construction phase are initiated in the alignment, design, or preconstruction phases. Other tools are intended for the construction phase only. Many of these tools focus on achieving quality requirements. Tools in the construction phase, listed in Table 7.1, can help the project team work collaboratively and efficiently. Detailed information on each tool and examples generously provided by leading agencies are available in Appendix A. Table 7.1. Summary of construction manager–general contractor construction phase tools. Tools for Construction Manager–General Contractor Construction Contract Administration Phase Project Complexity Project Size A lig nm en t D es ig n Pr ec on st ru ct io n C on st ru ct io n C lo se ou t N on co m pl ex M od er at el y C om pl ex C om pl ex $1 0 m ill io n $1 0 m ill io n– $5 0 m ill io n > $5 0 m ill io n Phase 4. Administer Construction of Construction Manager–General Contractor Project 7 Construction Manager– General Contractor Management Fee Table 8 Construction Manager– General Contractor– Specific Partnering 9 Continuity of Team Members 10 FHWA Involvement Overview 11 Permit Commitment Database 18 Open-Book Estimating 19 Public Announcements 20 Delegation of Authority 28 Contractor-Controlled Quality Control Testing 29 Contractor Involvement in Establishing Quality Control Standards 30 Real-Time Electronic Quality Management Information 31 Witness and Hold Points 32 Payment Checklist Note: = Recommended; = Consider case by case; = Not recommended.

30 Guidebooks for Post-Award Contract Administration for Highway Projects Delivered Using Alternative Contracting Methods 7.4 Summary The construction phase of a project is a joint effort between the agency and the CM-GC. The tools in this chapter highlight tools that agencies can use to administer construction. About half of the tools for this phase were used in one or more of the earlier project phases. Therefore, the project team should already be familiar with using these tools. The agency should introduce the team to any new tools that will be implemented in the construction phase, especially the quality-related tools. The primary goal of these tools is to help project participants communi- cate, document, plan, and execute construction efficiently. The list of tools presented in this chapter may inspire agencies to develop new tools or adapt some of these tools based on the needs of a particular project or the organizational structure of their agency.