A Project Primer

Completing a school construction or renovation successfully requires planning, communication and teamwork skills, as well as flexibility and mastery of arcane statutory and regulatory legal requirements relating to bidding and public-sector construction.

Some basic components and practical approaches can help institutions avoid the most common mistakes.

The planning process

During the planning process in many communities, the conflicting goals of obtaining information and moving the process along can create problems. Having the ability to solicit and prioritize a broad range of information and to galvanize community support can be the difference between passage and defeat of a referendum.

The broader vision for starting a capital program may derive from either a small committee or from one made up of members from many segments of the community, such as faculty and staff, students, community organizations, business and civic leaders, politicians and religious leaders. The initial planning committee must assess and articulate the district's or institution's capital needs or “wish list.”

The planning committee should pursue the following steps:

  • Undertake a survey assessing the conditions of the existing buildings and facilities.

  • Review and understand the capital needs relative to issues such as anticipating an expanding population.

  • Assist in identifying expectations for the scope and timing of the project.

  • Develop an understanding of the finance and budgeting process.

  • Understand that mechanisms for accurately estimating and controlling construction costs are essential.

  • Understand that project constraints because of land-use restrictions, zoning and environmental impacts must be determined as early as possible to avoid wasting money and delaying projects.

  • Define effective, ongoing roles for administrators, and school, professional and community advisory boards.

Choosing the players

An architect plays a critical role in facilitating the planning process and in transforming a school's broad visions into reality. It is crucial for an institution to investigate an architect's track record. A thorough reference check, including a review of an architect's concepts on past projects, is vital. A school also must go beyond the references provided and speak with superintendents and other administrators who have worked with the architect.

A contract with an architect must be tailored to the project and must set forth, in detail, the responsibilities of the school and the architect. An architect's role in the public bidding process — cost estimating, scheduling and dispute resolution — is important but often ignored, which can be detrimental to a school.

An architect must have in-depth knowledge of government requirements. A failure to comply strictly with government requirements can delay a project, jeopardize project funding or delay final approvals that are required for occupancy.

The best time to choose both an architect and construction manager is when the school is just beginning the planning process. Although an architect may be seen as the leader in developing the project plan, the construction manager must be disciplined in cost estimating, schedule, construction means and methods, and sequencing to ensure that the project begins on a firm foundation.

Too often, a school chooses a construction manager at a later time, and the firm does not have sufficient knowledge of the projected cost of construction. The most damaging consequence is a project design that has progressed without verifiable cost information. Bids that exceed a budget require value engineering and rebidding, a potentially expensive process that can cause significant delays.

As an adviser to a school district, a construction manager is in charge of dealing with trade contractors, and effectively developing and monitoring a project budget and schedule. A critical element of the contract with a construction manager is how the construction manager shares responsibility with an architect. The roles and responsibilities of a construction manager and an architect must be defined clearly in relation to certifications of payment, work acceptance, design review, project coordination, and change-order review and processing. Even after a construction manager is in place, it is imperative for a school to have a representative dedicated to the project who provides information to the district and decisions to the project team.

The architect, construction manager and school each need to have representatives with expertise, experience and communication skills. It is important to designate in the construction-management agreement an individual for each party who will be dedicated to the project for its duration.

Troubleshooting by outside construction counsel can help keep disputes out of formal dispute-resolution proceedings, such as arbitration or court. The ongoing involvement of this counsel can help resolve impasses that obstruct change-order approval or disputes regarding changed conditions. Construction attorneys often are able to craft creative solutions that eliminate the unpredictability of an arbitration or court proceeding.

Bidding and troubleshooting

By including the general conditions in the bid package itself, a school district can set the business terms of the contract with its construction contractor. In this way, the contract terms are accepted when a bid is submitted, and the contractor is bound to those terms. A contract that favors the school can make a meaningful difference in controlling the budget and schedule and in ensuring that options are available if the contractor fails to perform promptly or appropriately.

Some clauses that help protect the institution:

  • A no-damage-for-delay clause, which prevents a contractor from recovering against a school system for project delays.

  • A termination-for-convenience clause, which allows a school to terminate at any time without breaching the contract and without paying unreasonable damages.

  • The imposition of liquidated damages against the contractor for performing late.

  • A dispute-resolution clause, which allows the school to obtain a prompt and predictable outcome when a dispute arises.

It is essential to promptly resolve problems arising during construction. Delays can rapidly increase the budget and allow the schedule to slip.

The school must be prepared to keep the project moving forward by:

  • Taking work away from defaulting contractors and getting others to complete the work while backcharging the work to the defaulting party.

  • Asserting an errors-and-omissions claim against the architect or engineer.

  • Terminating the contractor and asserting a claim to recover from the contractor for defective or untimely performance.

  • Modifying the project team, which could mean terminating the construction manager or design professional.

  • Promptly addressing unanticipated lead-based paint, mold and asbestos issues.

  • Controlling change orders and claims in a consistent and reasonable manner throughout the project.

Efficient closeout

The time to think about project closeout is when an architect and construction manager are chosen. As each of the contracts is being developed, the school must focus on the “handoff” from the contractor, construction manager and architect.

Obtaining warranties and training the facilities staff often is neglected. Sufficient funds must be held back to ensure that closeout procedures, warranties and training can be completed. To be effective, closeout also must include full resolution of claims and project changes without litigation or arbitration.

Osborn is partner with John E. Osborn PC, a New York City and Westchester County law firm concentrating in the representation of school districts on construction contract and environmental troubleshooting and litigation.

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