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A Motion to Select a Preferred Construction Delivery Method for the Oak Park Municipal Campus Project and Direct Staff to Begin Soliciting Qualifications for Accompanying Services
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Introduction
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While JLK, Dewberry, and the team of consultants work to complete schematic design, Village staff, with the assistance of the schematic design team, wanted to take the opportunity to present commonly used construction delivery methods and their corresponding services. There are four types of construction delivery methods that will be presented: Design-Bid-Build (DBB), Design-Build (DB), Public-Private Partnerships (P3), and Construction Manager at Risk (CMAR). The schematic design team recommends choosing a construction delivery method for the Police Department for the first phase of construction, at this time, and then evaluating construction delivery methods for each phase of Village Hall improvements as the scope of those subsequent phases is clarified.
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Recommended Action
Adopt the Motion and select a Preferred Construction Delivery Method.
Prior Board Action
There is no prior Board action associated with this item.
Background
Construction delivery method is the process of assigning and allocating the contractual responsibilities for planning, designing, managing, and constructing a project. While JLK, Dewberry, and the team of consultants work to complete schematic design, Village staff, with the assistance of the schematic design team, wanted to take the opportunity to present commonly used construction delivery methods and their corresponding services. The construction delivery method chosen can have varying impacts on the project timeline, the quality of construction, the overall cost, and the legal relationship between the Owner, Architects/Engineers, and the General Contractor. Please see below for a summary of the four most commonly used construction delivery methods.
DESIGN-BID-BUILD (DBB)
The most common construction delivery method in which the Village would contract with the Architects/Engineers and a General Contractor under separate contracts. The design process is completed, and drawings/specifications are developed for solicitation package development in advance of the competitive bid process. The General Contractor typically has little input during the design process but is able to seek clarification as part of the competitive bid process. The award of a construction contract is typically issued to the lowest responsible bidder.
While the Design-Bid-Build delivery method fosters market competition for the lowest initial price possible, it may not be the best option for complex projects to optimize the best value to the Village.
DESIGN-BUILD (DB)
Under a Design-Build contract, the Village would contract with a single entity, typically the General Contractor, that would remain the single point of responsibility and provide both the design and construction services for the project. While a set of preliminary design schematics would be provided to the General Contractor by the Village, the Village would be foregoing the direct interaction that it currently has with the Architects/Engineers in exchange for the General Contractor’s early involvement in the design process. The benefit would be that the design and construction teams form an alliance that would allow for the project to be streamlined to deliver the project more expeditiously and with fewer change orders.
While this project works well for complex projects that may not have the time to develop a complete design package in advance of the construction contract award, those benefits come at the cost of Village control over design details, and quality could be impacted significantly by cost considerations.
PUBLIC-PRIVATE PARTNERSHIPS (P3)
A Public-Private Partnership (P3) is a construction delivery method in which the Village would partner with a private entity to design, finance, build, operate, and/or maintain a public infrastructure asset. Rather than the Village managing all phases separately, responsibilities and risks are allocated between the Village and the private partner through a long-term contractual agreement. As part of this method, the Village would not be required to use its own bonding capacity to fund the project, and lease payments typically do not begin until the public infrastructure asset can be occupied.
While a seemingly attractive method for an accelerated project delivery timeline and risk transfer from the Village to a private partner, the project could ultimately be delayed due to a complex procurement process, a lengthy negotiation process, and unforeseen financial issues on the part of the developer. During the concept design phase of the Oak Park Municipal Campus project, Village staff explored options associated with P3 and found that it might be difficult to market the Village’s project as this type of construction delivery method is most commonly employed for transportation infrastructure, water and wastewater systems, hospitals and healthcare facilities, and energy utilities.
CONSTRUCTION MANAGER AT RISK (CMAR)
In a Construction Manager at Risk delivery method, the Village would remain engaged with the Architects/Engineers and hire a qualified Construction Manager under a negotiated contract to provide both preconstruction services and the construction of the project with a fixed fee and a Guaranteed Maximum Price (GMP). CMAR allows for the early project involvement of a Construction Manager who can partner with the Architects/Engineers and Village to provide constructability assistance, cost estimating, design review, and early procurement opportunities. The CMAR typically provides detailed cost estimates early in the design phase, so that value engineering and cost reduction strategies can be employed when they are most easily addressed. Additionally, the start of construction could begin prior to the completion of design documents.
The new Police Department facility includes specialized program requirements, complex building systems, security considerations, and a multi-level parking structure, all of which would benefit from early contractor involvement that CMAR allows for during the design process.
Timing Considerations
There are three phases to designing a project: schematic design, design development, and detailed design, where construction documents are created. Currently, the Oak Park Municipal Campus project is in the schematic design phase. The construction delivery method that Village staff are recommending, Construction Manager at Risk (CMAR), requires that the Village begin the qualifications-based selection process during the schematic design phase so that the CMAR is onboard to provide various preconstruction services such as scheduling, value engineering, and subcontractor prequalification services, as well as, prepare to negotiate the Guaranteed Maximum Price (GMP) during the design development phase.
Village staff anticipates the advancement of the project to the design development phase following the August 25, 2026, Village Board meeting. Therefore, it would be beneficial to begin the qualifications-based selection process as soon as possible.
Financial Impact
The construction delivery method chosen could have large financial impacts on the overall cost of the project. While some require a competitive bidding process resulting in a potentially lower initial construction cost, Village staff’s recommendation of Construction Manager at Risk (CMAR) would allow for the negotiation of the Guaranteed Maximum Price (GMP) based on estimates during the design development phase that would allow for cost certainty throughout the remainder of the design process and into construction. Having a CMAR on board during the design process allows for real-time estimates and hard cost analysis that leads to expert input on value engineering, and life-cycle cost alternatives to better allocate costs and expenses to the critical goals of the project.
Operations Impact
While there are no construction delivery methods that will eliminate all project coordination by Public Works staff on behalf of the Village, there are a few presented that could greatly reduce the Village’s coordination burden. The disadvantage of reducing this burden is the loss of control over the design details. Public Works Department staff consider this project a core department service as identified in the Village Board goals and, therefore, do not anticipate the operational impact of the construction delivery method chosen to be any greater than that of the OPMC design process, thus far.
DEI Impact
There is no DEI impact associated with this item.
Community Input
There has been no community input given in relation to this item.
Staff Recommendation
Village staff recommends the Construction Manager at Risk (CMAR) delivery method for the initial phase of the Oak Park Municipal Campus project, which includes the Police Department.
Advantages:
• Owner negotiates a Guaranteed Maximum Price (GMP) for the project to create cost certainty.
• Establishes a collaborative environment for the Owner, Architect, and Contractor to interact early and discuss constructability and scheduling.
• A proven delivery method for complex projects with accelerated schedules, difficult site conditions, intricate phasing, and the need for special equipment or systems.
• Allows for the opportunity to use a qualifications-based selection process instead of a competitive bid process, thereby allowing the Owner to eliminate those that may not have the resources or experience to perform the project successfully.
Disadvantages:
• The owner has less direct control over subcontractor selection.
• Potential conflicts can arise during Guaranteed Maximum Price (GMP) negotiations.
• Design changes after the Guaranteed Maximum Price (GMP) is agreed upon could result in change orders.
Alternatives
Alternative 1:
The Village Board could choose one of the additional construction delivery methods that were presented, including Design-Bid-Build (DBB), Design-Build (DB), Progressive Design-Build (PDB), and Public-Private Partnership (P3).
Advantages:
• A detailed outline of the advantages of each additional construction delivery method was presented in the slide deck and attached along with this summary.
Disadvantages:
• A detailed outline of the disadvantages of each additional construction delivery method was presented in the slide deck and attached along with this summary.
Anticipated Future Actions
Village staff anticipates returning to the Village Board in the future with a professional services agreement based on the preferred construction delivery method chosen.
Prepared By: Erin Duffy, Deputy Public Works Director
Reviewed By: Rob Sproule, Public Works Director
Approved By: Kevin J. Jackson, Village Manager
Attachment(s):
1. Construction Delivery Method Presentation