HomeMy WebLinkAboutSEOPW-CRA-R-01-01391 SEOPW/CRA ITEM 8
SE®PW/CRA.
RESOLUTION NO. 0 1` 13 9
A RESOLUTION OF THE BOARD :OF DIRECTORS OF
THE SOUTHEAST OVERTOWN/PARK WEST COMMUNITY
REDEVELOPMENT AGENCY ("CRA") AUTHORIZING THE
EXECUTIVE DIRECTOR TO SELECT NO MORE THAN
THREE RESPONDENTS TO THE CRA RFQ (ATTACHED)
FOR A CONSTRUCTION MANAGER (CM) AT RISK FOR
VARIOUS PROJECTS IN THE SEOPW AND OMNI
COMMUNITY REDEVELOPMENT AREAS AND RETURN
WITH THE SELECTIONS AS SOON AS POSSIBLE TO
THE CRA BOARD FOR RATIFICATION.
WHEREAS, the CRA, is responsible for carrying out
redevelopment activities and projects in the CRA Redevelopment
Area established pursuant to the CRA Redevelopment Plan; and
WHEREAS, Resolution No. 01-106 authorized the Executive
Director to issue an expedited RFQ and advertise for a CM at
Risk for the CPA; and
WHEREAS, the CRA is desirous of maintaining a pool of CM at
Risks from which to make selections for various projects.
NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF DIRECTORS OF
THE SOUTHEAST OVERTOWN/PARK WEST COMMUNITY REDEVELOPMENT AGENCY
OF THE CITY OF MIAMI, FLORIDA:
SEOPW/CI A
1- 139
Section 1. The recitals and findings contained in the
Preamble to this Resolution are incorporated herein as if fully
set forth in this Section.
Section 2. The Executive Director is authorized to
select no more than three respondents to the CRA's RFQ for CM at
Risk and return as soon as possible with the selection results
for Board ratification.
Section 3. The Resolution shall be effective upon its
adoption.
PASSED AND ADOPTED on this 11th day of December, 2001.
ATTEST:
WALTER J. FOEMAN
ACTING CITY CLERK
ARTHUR E. TEELE, JR., CHAIRMAN
3S.
SBOM CRA.
Page 2 of 2 0 1 - 1.39
SEOPW AND OMNI/CRA
CITY CLERK'S REPORT
MEETING DATE: December 11, 2001 Page No. 6
ITEM 8 A RESOLUTION OF THE BOARD OF DIRECTORS SEOPW/CRA R-01-139
OF THE SOUTHEAST OVERTOWN/PARK WEST MOVED: WINTON
AND OMNI COMMUNITY REDEVELOPMENT SECONDED: REGALADO
AGENCIES ("CRA") AUTHORIZING THE UNANIMOUS
EXECUTIVE DIRECTOR TO: I) SELECT NO LESS
THAN TWO (2) OR GREATER THAN THREE (3)
RESPONDENTS TO THE CRA RFQ (ATTACHED)
FOR A MISCELLANEOUS CONSTRUCTION
MANAGER (CM) AT RISK FOR VARIOUS
PROJECTS IN THE SEOPW AND OMNI CRAS; AND
II) RETURN RESULTING SELECTIONS TO THE
CRA BOARD FOR RATIFICATION.
ITEM 9A A OLUTION OF THE BOARD OF DIRECTORS SEOPW/CRA R-01-140
OF TH UTHEAST OVERTOWN/PARK WEST MOVED: WINTON
COMMUNIT REDEVELOPMENT AGENCY SECONDED: GONZALEZ
("CRA") (subject m k,�r: authorizing the Executive UNANIMOUS
Director and directing CI , Counsel to encourage the
City, Commission to initiate �anw y actions to address
W-ASA issues as it relates to the redev�pment area).
ITEM 20 A OTION INSTRUCTING THE EXECUTIVE OMNI/CRA M-01-35
DIRE TOR TO MEET WITH MR. RICHARD MOVED: WINTON
HAYLORTI OF W.H.E. ENTERPRISES IN SECONDED: SANCHEZ
CONNECWITH POTENTIAL JOBS TO BE ABSENT: REGALADO
CREATED IN O I REDEVELOPMENT DISTRICT,
MORE PARTICU 4RLY THE AREA OF 1756
NORTH BAYSHORE E, AND TO COME BACK
AT NEXT CRA BOA MEETING WITH A
RECOMMENDATION.
CITY OF MIAMI, FLORIDA
FROM:
Chairman Teele and
Members of the CRA Board
Annette E. Lewis
Acting Executive Dix for
RECOMMENDATION
INTER -OFFICE MEMORANDUM ITEM 8
December 11, 2001
DATE: December 11, 2001 FILE:
SUBJECT: Authorizing the Executive
Director to select CM at Risk
REFERENCES: and return to the Board for
ratification
ENCLOSURES: Resolution
It is recommended that the Board of Directors of the Southeast Overtown/Park West and OMNI
Community Redevelopment Agencies of the City of Miami ("CRA") approve the attached
Resolution authorizing the Executive Director to make CM at Risk selections based on an
expedited RFQ and return to the Board for ratification.
BACKGROUND
On July 30, 2001 the CRA adopted Resolution No. 01-106 authorizing the Executive Director
issue an expedited RFQ for construction services as a direct result of the three businesses that
received grant awards from the CR.A's Commercial Revitalization Grant Program.
Funding Source: SEOPW General Operating,Fund
Account Number: 689004.550011.6.340
SEOPW / CRA
01- 139
l An important feature of a CM/GC scenario is that the CM prequalifies trade contractors
before bidding occurs, Johnson said. The Associated General Contractors of America
recently issued guidelines for public owners who want to use this delivery method.
Early collaboration produces efficiencies
Hoyt Lowder, senior vice president of Raleigh, N.C.-based construction consultant FMI
Corp., said sophisticated contractors, design/ builders and subcontractors are now
collaborating more extensively with owners at an early project phase. This allows them to
be more comfortable in providing a realistic GMP when drawings may be only 30 percent
complete. These contractors recognize that the efficiencies inherent in this collaboration
can be translated to their bottom line, Lowder said.
Owners who have not been satisfied with the delivery of their projects also benefit from
this redefinition of the collaborative process, which gives them greater involvement in the
planning stages. "I see that as a major change," he said.
The end result of these cooperative efforts for all building team -members is that
competition is increasingly based on uniqueness rather than on traditional approaches as
outlined by standard contracts, according to Lowder.
Melvin Hildebrandt, CEO of Houston -based Linbeck Construction Corp., believes one
reason that the term "construction manager" has become more widely used is because it
implies participation in the preconstruction phase to provide guidance on constructability
and cost. Linbeck, which does no bid work, refers to itself as a "builder."
The company promotes what it characterizes as "an interative process of continuous
optimization" in which the client and Linbeck jointly establish a "balanced scorecard" of
criteria that will be used to design and construct the project. This process removes
Linbeck's perceived conflict of interest in establishing a GNP, because it focuses on
quality, schedule and functionality goals as well as cost.
Sheryl Maibach, vice president of marketing for Southfield, Mich. -based general
contractor Barton Malow Co., said the term "general contracting" implies that plans are
complete and that the lowest responsible bidder receives the contract, but that the
contractor has not provided any prebidding input to the design. "In the public sector,
that's the way it is," she said. An exception might occur if budget problems arise after
bids are received. The owner might then invite the low bidder to help get the project back
on budget. But this would be done based on a completed design, she emphasized.
COPYRIGHT 1999 Cahners Publishing Company
COPYRIGHT 2000 Gale Group
SEOPW/CRA
01- 139
Management Summary
Item # 8
Construction Management
Construction Managers are the owners agents and manage the entire building
process. The construction manager has overall management responsibility; consequently,
there is no prime or general contractor on the job.
Each segment of construction is contracted separately with the owner with the
advice of the construction manager. Once the contracts have been awarded, the
construction manager works to facilitate on -site communication and coordination.
Prior to construction, the construction manager performs services similar to those
the contractor performs in the pre -construction phase of the design/ build procedure of
the team method.
The Construction Manager prepares cost estimates; however, he cannot guarantee
costs. He does not assume contractual responsibilities and corresponding risks of
construction.
The risks of the construction execution all belong to the owner.
"CM at risk" (construction management at risk)
CM at risk is derived from contracts that provide that the contractor serves a dual
role as Construction Manager (who is involved in pre -construction development) and
General Contractor (who provides a Guaranteed Maximum Price).
CM at risk has become more popular as a result of procurement practices of
public agencies, primarily at the state level. These agencies have wanted to utilize a CM
process with a contractor carrying the contracts, but have been hindered by public
bidding statutes.
Owners are motivated to use this approach because they haven't been too
successful in developing well-defined lump sum documents from which they can get firm
bids. As a result, in their attempts to cap their costs, they become involved with claims
and change orders.
An important feature of a CM/GC scenario is that the CM pre -qualifies trade
contractors before bidding occurs; therefore, there is more efficiency in the building and
bidding process.
Contractors, design/ builders and subcontractors are now collaborating more
extensively with owners at an early project phase. This allows them to be more
comfortable in providing a realistic GMP (Guaranteed Maximum Price) when drawings
may be only 30 percent complete.
Of- 139
Construction Management
Construction Management evolved from the government's attempts to introduce
construction know-how throughout its multi -million dollar projects, and to more
effectively manage the highly fragmented series of discrete decisions involved in the
traditional building process.
Although this approach has several different variations, the essence of the concept centers
around the introduction of a construction manager as the owner's agent and manager of
the entire building process.
Since the construction manager has overall management responsibility, there is no prime
or general contractor on the job. Each segment of construction is contracted separately
with the owner (not the construction manager) with the advice of the construction
manager. Once the contracts have been awarded, the construction manager works to
facilitate on -site communications and coordination.
Prior to construction, the construction manager performs services similar to those the
contractor performs in the pre -construction phases of the design/build procedure or the
team method.
But even though the construction manager prepares cost estimates, he cannot guarantee
costs. He does not assume the contractual responsibilities and corresponding risks of the
construction.
The risks of the construction execution all belong to the owner.
In situations where traditional bidding procedure is required by government regulation,
the construction management approach can ease many of the difficulties.
What is Construction Management?
The construction manager serves as a member of the management team with the client
(the edu,cational entity) and the architect. The construction manager is on the job from the
initial planning phases to the final completion date, providing input to the architect,
ensuring quality construction, and keeping a cap on building costs.
Two types of construction delivery methods commonly available to Mississippi school
boards and other public entities (such as counties and municipalities) are the
design/bid/build method and construction management. Design/bid/build utilized the
service of a general contractor, whereas construction management takes advantage of the
use of professional services provided by, a construction manager.
With design/bid/build, a project is designed by an architect — often without any input
from a builder during the design process. The school board typically awards a lump -sum
contract to the general contractor selected through the public, "hard -bid" process. The
general contractor hires subcontractors to do specialty work, while performing some of
the work with his own forces.
SEOPW / CRA
01- 139
Used on both public and private construction, the construction management delivery
method is used extensively throughout the U.S. for educational building projects. Since
construction management is considered a professional service by the Mississippi public
procurement statutes, a construction manager is selected through a negotiated process
much the same as an architect. This allows a school board to select a builder based on his
track=record, resources, and ability to perform the work. The construction manager's fee
is typically based on a percentage of construction costs. The construction manager is
generally hired at approximately the same time as the architect and works with the design
professionals throughout the design and planning phase of the project, providing cost and
scheduling feedback and information. This ensures that the school board gets the "best
bang for the buck".
Once design is complete, the construction manager (in conjunction with the architect
prepares bid -packages for the various aspects of the work (e.g., site -work, mechanical,_
electrical, etc.). These packages are put out for bids to trade contractors (otherwise known
as subcontractors) — not general contractors. Contracts for each portion of the work are
awarded to trade contractors in accordance with Mississippi's "lowest and best" rule. The
construction manager then serves on site to manage, supervise, and coordinate the
construction. Note that there is no general contractor involved in this process — the
construction manager replaces the general contractor.
The construction manager is paid a fee based on a percentage of total construction costs
plus reimbursable project costs (the cost to run the project from the jobsite, e.g. project
superintendent, office trailer, pick-up truck, etc.). The construction manager's fee and
reimbursables are comparable to a general contractor's profit and overhead (equivalent to
the construction manager's fee) and general conditions (equivalent to the construction
manager's reimbursables). In many instances, the construction manager's fee and
reimbursables are less than a general contractor's profit, overhead, and general conditions.
When a public owner hires a true construction manager, there is no doubling up of fees or
costs since the construction manager replaces the general contractor, monies that would
have otherwise been paid to a general contractor are available to pay for a construction
manager's services. Primary disadvantages to the design/bid/build construction delivery
method and advantages to the Construction Management process are summarized:
Drawbacks of the General Contractor
1. Because there is no input by a builder during the design process, there is the very real
possibility that the architect will design facilities that cost more to build than the board
can afford, requiring re -design and re -bid (Read: Lost Time!);
2. Changes to scope of work or ambiguities in design can give rise to disputes between
the school board, the architect, and the general contractor, leading to additional cost
(Read: Change Orders!);
3. Savings realized by the general contractor during the building process do not go back
to the school board — they are retained by the general contractor.
Defining "CM at risk".(construction management at risk)
Issue: Oct, 1999
While distinctions are drawn over the details, there is agreement that the contractor must
deliver the project without exceeding a maximum price
To a greater extent than is the case in many fields, terminology used in the construction
industry defies precise definition.
A case in point: Does "construction management at risk" mean the same thing as
providing the owner with a guaranteed maximum price (GMP)? The short answer is yes.
But other considerations must also be taken into account, according to industry
practitioners.
The Construction Management Association of America (CMAA) recently refined its
definition of "construction manager" (CM). "CMs advise and counsel owners no matter
what delivery system the owner wants, and will advise the owner about different
[delivery] methods," said Bruce D'Agostino, executive director of the Reston, Va.-based
association. In some cases -- particularly when trust has been established as the result of
working previously with an owner -- the CM may function on an at -risk basis, he said.
CMAA was founded 17 years ago as an organization representing only "agency"
construction managers who work on a fee basis. D'Agostino said a CM operates in an
agency mode until such time that the owner decides that the CM should continue working
on an at -risk basis.
This broader definition of CM may rankle CMAA members who espouse the agency
format, but D'Agostino characterized CMAA's philosophy as "delivery systems neutral."
He added: "Whatever is right for [a given] project and whatever the owner wants, that's
what a professional CM should offer."
Ralph Johnson, senior vice president of Turner Construction Co., attributes the rise in the
popularity of the term "CM at risk" in part to procurement practices of public agencies,
primarily at the state level. These agencies have wanted to utilize a CM process with a
contractor carrying the contracts, but have been hindered by public bidding statutes, he
said.
What has evolved are contracts providing the contractor with a dual role as both CM
(who is involved in preconstruction development) and general contractor (who provides a
GMP). "Essentially, that's what is done in the private sector," Johnson said.
Owners are motivated to use this approach because they "haven't been too successful in
developing well-defined lump sum documents from which they can get firm bids,"
Johnson said. As a result, in their attempts to cap their costs, they become involved with
claims and change orders.
SEOPW/CRA
01- 139
0
�..r ITEM 8
December 11, 2001
RESOLUTION NO.SEOPW/CRA
A RESOLUTION OF THE BOARD OF DIRECTORS OF THE
SOUTHEAST OVERTOWN/PARK WEST AND OMNI
COMMUNITY REDEVELOPMENT AGENCIES ("CRA")
AUTHORIZING THE EXECUTIVE DIRECTOR TO i) SELECT
NO LESS THAN TWO (2) OR GREATER THAN THREE (3)
RESPONDENTS TO THE CRA RFQ (ATTACHED) FOR A
MISCELLANEOUS CONSTRUCTION MANAGER (CM) AT
RISK FOR VARIOUS PROJECTS IN THE SEOPW AND OMNI
CRAS ii) RETURN RESULTING SELECTIONS TO THE CRA
BOARD FOR RATIFICATION.
WHEREAS, the CRA is responsible for carrying out redevelopment activities and
projects in the Southeast Overtown/Park West Community Redevelopment Area established
pursuant to the CRA Redevelopment Plan; and
WHEREAS, Resolution No. 01-106 authorized the Executive Director to issue an
expedited RFQ for a CM at Risk and advertise for a CM at Risk for the CRA; and
WHEREAS, it is desirous to maintain a limited pool of CM at Risks, from which to
select, with varying experiences based on job type and size.
NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE
SOUTHEAST OVERTOWN PARKWEST AND OMNI COMMUNITY REDEVELOPMENT
AGENCIES OF THE CITY OF MIAMI, FLORIDA:
Section 1. The recitals and findings contained in the Preamble to this Resolution are
incorporated herein as if fully set forth in this Section.
Section 2. The Executive Director is authorized select at least two (2) but no more
than three respondents to the CRA's RFQ for CM at Risk and return selection results for Board
ratification.
Section 3. This resolution shall be effective immediately upon its adoption.
PASSED AND ADOPTED this l lth day of December, 2001.
Arthur E. Teele, Jr., Chairman
SEOPW / CRA
Im
N
N
Walter J. Foeman
City Clerk
APPROVED AS TO FORM
AND CORRECTNESS:
Alejandro Vilarello
City Attorney
0
ITEM 8
December 11, 2001
K
SEOPW/CRA
01- 139
CITY OF MIAMI, FLORIDA V
O: Chairman Teele and
`+%W Members of the CRA Board
FROM: Annette E. Lewis
Acting Executive Dir for
0
RECOMMENDATION
INTER -OFFICE MEMORANDUM ITEM 8
December 11, 2001
DATE: December 11, 2001 FILE:
SUBJECT: Authorizing the Executive
Director to select CM at Risk
REFERENCES: and return to the Board for
ratification
ENCLOSURES: Resolution
It is recommended that the Board of Directors of the Southeast Overtown/Park West and OMNI
Community Redevelopment Agencies of the City of Miami ("CRA") approve the attached
Resolution authorizing the Executive Director to make CM at Risk selections based on an
expedited RFQ and return to the Board for ratification.
BACKGROUND
On July 30, 2001 the CRA adopted Resolution No. 01-106 authorizing the Executive Director
issue an expedited RFQ for construction services as a direct result of the three businesses that
received grant awards from the CRA's Commercial Revitalization Grant Program.
Funding Source: SEOPW General Operating Fund
Account Number: 689004.550011.6.340
SEOPW / CRA
0 J - 190