Owners nationwide are using design/build to construct projects in greater numbers. If the Sixth Street Viaduct project proves to be a success, it could propel the use of design/build in Wisconsin, particularly for public projects.
Every Wednesday at 9 a.m, a marathon meeting begins in Room 918 of the Zeidler Municipal Building in downtown Milwaukee. Engineers from three Milwaukee-area companies meet with representatives from the city, county and state to discuss the design and construction of a work in progress: the Sixth Street Viaduct, billed as the new gateway to Milwaukee.
Occasionally the meetings end at noon, but often they continue well into the afternoon. When they do break, the engineers and the project clients - the City of Milwaukee, the Wisconsin Department of Transportation, and Milwaukee County - keep talking via e-mail and telephone. They know they are under a microscope. Not only are they designing and constructing a signature project, they are constructing Wisconsin's first design/build transportation project.
The design/build process allows the design to be completed after construction is under way.
Owners nationwide, both public and private, are using design/build to construct projects in greater numbers. If the Sixth Street Viaduct project proves to be a success, it is expected to spur the use of design/build in Wisconsin, particularly for public projects.
Consequently, contractors, subcontractors, architects, engineers and consultants should prepare themselves to compete in that growing market.
The project
A team of three firms is building Wisconsin's first design/build transportation project. Milwaukee Gateway Partners, a joint venture of HNTB Corp., Zenith Tech, Inc., and Lunda Construction Co., was awarded the $50 million contract in June.
The new bridge will replace the 91-year-old existing viaduct that spans Milwaukee's Menomonee Valley.
Unlike the existing bridge, the new bridge will slope down into the valley, which is a major focus of city redevelopment plans. The current bridge spans the valley in a straight plane and has a zig-zap ramp and steep staircases leading to and from the valley below.
Plans call for a new 80-foot wide, four-lane structure featuring the state's first two cable-stayed spans, and two double-leaf bascule bridges over the Menomonee River and shipping canal. Plans also include a bicycle lane and sidewalks.
The aesthetics of the bridge have been given high priority, says Scott Butzen, a vice president of the HNTB Corp., who is the design program manager of the project. It is intended to become a landmark, like the Gateway Arch of St. Louis, but less ostentatious.
The contractors received 30% of the design plans from the city, county and state prior to bidding on the job. They began construction in the fall, while simultaneously continuing to develop the design. The entire project is scheduled to last about two years, but contract provisions limit closure to traffic to 15 months. Demolition is slated to begin May 1.
The limit on construction time is a key reason for using design/build on the Sixth Street project, says Butzen. "It's effective for jobs that need to be started and finished quickly," he says. "The deteriorating condition of the existing bridge had already led the city to limit it to one lane of traffic each way, and to increase weight restrictions. That has a lot to do with the urgency of this project."
Another reason for using design/build with this project is Milwaukee's successful experience with it in a large ozonation project at Milwaukee's two water treatment plants completed in 1998. Not only was that project completed in 17 months and $11 million under budget, but, most important, it was effective in ensuring high-quality water for Milwaukee, says James Purko, Milwaukee's deputy commissioner of public works.
"We don't consider the Sixth Street Viaduct project a trial (run)," says Purko. "We have experience with design/build and we have confidence in the process."
The process
The design/build process differs from the traditional design-bid-build process in significant ways, says John Haverberg, the DOT expert on design/build. He recently provided a training program on the process to DOT employees.
Traditionally, the DOT or other contracting agency designs a project either in-house or through a design consultant. The completed plans and specifications are let through a sealed bid advertised letting. The project is then awarded to a qualified construction firm, with the lowest price a prime consideration.
In design/build, the contracting agency identifies end-result parameters and establishes the design criteria. Prospective bidders develop design proposals, requiring a much greater up-front investment for them. Proposals are rated and a combined design/construction contract is awarded to one company.
The new contract approach has implications for risk and liability, he notes. The design/builder assumes both the risks of design and construction. If there are errors and omissions in the plans and specifications, the designer/builder must assume any cost incurred to overcome the problem.
Consequently, design/build minimizes the potential for dispute-related cost overruns. However, the designer/builders have greater responsibility, giving them more liability. They must be prepared to evaluate and manage risks. On the other hand, designer/builders have potential for higher gross margins since they are doing both design and construction.
Design/build also gives contractors more control over their projects, notes Dave Brose, an engineer with Engineering Management Consulting Services, a subcontractor on the Sixth Street Viaduct project. "It's exciting for contractors. It is more efficient and cost-effective, and it can motivate them to do their best work," he says.
But there is a concern about quality in design/build, says Brose, whose firm is responsible for quality assurance on the Sixth Street Viaduct project. "There is a concern, and rightfully son, that some contractors might cut corners," he said.
Another issue is the dizzying pace of design/build, notes Aziz Aleiou, the DOT engineer who is project manager for the new viaduct. "This is the fast track," he says. "We estimate it may shorten delivery time on this job by a year or more and result in substantial savings. But you have to stay on top of it or you might make mistakes you'd feel sorry about later."
Jim Forseth, a DOT supervisor, says the novelty of such a project poses a challenge. "The biggest drawback on using design/build on the Sixth Street Viaduct project is the inexperience many of us have with the process," said "It has the potential to be an effective tool, but there are many issues to sort out, and the nervousness felt when giving up control. But we are getting up to speed."
The use of design/build for public projects has been limited by laws controlling the bidding process. In Wisconsin, the law requires state to conduct a competitive bid process on a designed project and award the contract to the lowest bidder. The state legislature, in the 1999-2000 budget bill, made an exception for the Sixth Street Viaduct.
"The legislature said instead of going whole hog on this thing, let's try it one time and see what happens," says James Theil, an attorney with DOT.
The jury is still out
"Design/build hasn't really caught on in the upper Midwest," says Scott Piefer, a project manager for Zenith Tech. "A lot of people are watching this Sixth Street Viaduct project very closely. The jury is going to be out until this project is over as to whether or not design/build is a good fit for the way we do business in Wisconsin. It's wait and see at this point."
Design/build gets mixed reviews from contractors, so much so that the Wisconsin Transportation Builders Association expects to spend much of the year studying the issue before the organization takes a position.
"We're in the process of trying to better understand it and when and where it should be used," says Tom Walker, executive director of the Wisconsin Transportation Builders Association. "There are a variety of perspectives on it in our organization."
Some contractors are concerned that design/build would limit competition, saying it would favor large firms and those which already have design/build experience.
Contractors have legitimate concerns about the up-front costs involved in developing competitive design/build proposals, says Butzen. For some firms, those costs would be prohibitive.
Be prepared
"My sense is that if it is successful, we'll be seeing more design/build in the near future," says Butzen, whose firm HNTB has been involved in numerous design/build projects on the West Coast. "It will not replace the traditional model, but will be considered a viable alternative."
Consequently, small contractors who want to move into this market should start getting ready now, says Butzen. "They need to have their ears to the ground on potential projects and find out what they need to do to position themselves to become members of these teams.
"The biggest thing they need to know is that design/build bids require a lot more up front work. We began strategizing 18 months before bids were solicited for the Sixth Street Viaduct project," he says.
"If I were a small contractor, I'd be trying to align myself with firms doing design/build long before requests for proposals are done. The time to start is now."
By SANDRA WHITEHEAD, For SBT
