FEATURE ARTICLE

The Design-Build Project The Design-Build Project Delivery System

BY BETH BALES

The Design-Build project delivery system was good enough for the high-profile Pentagon project — which came in millions under budget. As a matter of fact, it's good enough for military buildings, highways, universities, public schools in some states, sports stadiums and many other public projects.

But its not permitted for a park district recreation center in Illinois — at least, not yet (see sidebar).

The centuries-old design-build method is also known as a "single-source" method of delivery. Generally, the project owner contracts with one firm, usually a construction company, that in turn oversees the entire project, hiring the architect and all sub-contractors. A guaranteed maximum price is set before construction documents are completed. And usually the architect, engineers and sub-contractors work together from the beginning.

That's opposed to the familiar design-bid-build process, also known as "low-bid construction." With that process, the owner hires an architect to design a building that will fit the proposed program and budget. Then bids are sought for all the various components, with low bids carrying the day.

Its estimated that by 2005, design-build could exceed design-bid-build as a method of delivery. But, although some public entities have statutory authority to use design-build, park districts in Illinois do not.

Under the Professional Services Selection Act, park districts choose firms for professional services such as architectural and engineering and land surveying on the basis of demonstrated competence, not price. But the Park Code requires that construction work be bid out. Under the Park Code, the project must be awarded to the lowest responsive and responsible bidder, a requirement that does not easily allow using the design-build method.

Within the past few years, however, park districts have sought the authority to use the design-build method.

Advocates say design-build saves money and time. Critics complain the process strips the owner of control, aesthetics suffer and cost guarantees can lead to imprudent cost cutting.

Mark Shambaugh, chairman of the Washington-based Design-Build Institute of America, cited eight "commonly recognized advantages" of design-build in a September article in "Midwest Construction." Those advantages are: "time savings, engineering and construction cost savings, knowledge of costs up front, value engineering up front, constructability review up front, communication and partnering, one-source responsibility for reduced owner risk, and total quality management."

"It's a very favorable delivery method," said architect Douglas Hoizrichter, a principal at PHN Architects of Wheaton, which specializes in recreational facilities. "It's certainly one of the most cost-effective approaches to construction."

He has worked on several design-build projects, some of them with PHN Construction Ltd., an affiliated company. "The design-build approach unites the designers with the contractors early in the process, and they develop a common goal. That's a significant advantage."

"It's a better forum for open discussion," agreed Jim Leppert, director of construction services for PHN Construction. "Ideas between designers and contractors flow more freely. Someone can say, 'I have a better idea.'"

According to Hoizrichter, this collaboration can also save money. "Architects — and I am one — don't necessarily have as much firsthand experience with costs as contractors do," he said. He added that architects and engineers sometimes design structures without fully understanding cost implications. "Very subtle design changes could mean huge cost variations."

"Seven published studies that I'm aware of show that it's faster, cheaper and
better than other traditional methods, for both public and private projects."

For example, Hoizrichter said in a recent design-build project, the electrical contractor suggested rearranging the electrical service components, saving $20,000.

Hoizrichter cautioned that the design-build approach does require that certain design and

18 Illinois Parks and Recreation

performance requirements be decided early in the process. "You need to determine and define how the building should perform, its function and use, how many parking spaces are needed, etc. You need some kind of plan before getting bids."

Derke Price, a partner at Ancel, Glink, Diamond, Bush, DiCianni & Rolek, agreed that the design-build approach has its benefits. "Seven published studies that I'm aware of show that it's faster, cheaper and better than other traditional methods, for both public and private projects." Price's law firm represents 26 Illinois park districts, and its clients are very interested in being allowed to use design-build.

Price explained that park districts can "back into" a kind of design-build method. A park board, in compliance with the Professional Services Selection Act, can pick an architectural firm, negotiate a contract and then have design-builders competitively bid the project, with the design contract being assigned to the design-builder. In this way, the design contract becomes an allowance that the bidders figure into their bid. "And, at the end of the day, you have a single-source delivery project," Price said.

But he added that a district may not have obtained all the benefits of design-build, because the district is forcing a relationship that may not lead to the united, open partnership of designer and builder that is the hallmark of a good design-build project.

Warrenville City Administrator John Coakley has been directly involved with design-build projects in three of the four cities in which he's worked.

"It's an excellent delivery method," he said. "As project manager for the city, I don't have to deal with the architect, the engineers and general contractor and all kinds of subs. I have one single-source point of contact. If there are any problems, I call the design-builder. It makes my life a lot easier."

He believes costs savings result. "Of course, it's impossible to confirm that without a head-to-head comparison, bidding and doing the project both ways, which ot course you wouldn't do," he acknowledged.

"Anything you want built can be built with design-build."
- Jim Leppert, PHN Construction

Status of design-build in Illinois Change - allowing Illinois park districts to use a two-step design-build method — may be on the way. A House bill sponsored by Rep. Terrence Parke (R-Hoffman Estates) was introduced this session, but has been held pending legislation providing design build authority for the State of Illinois. See SB 1497. At the behest of the Illinois Association of Park Districts, Parke had sponsored legislation in the 92nd Illinois General Assembly that would have amended the Park District Code to allow park districts in the state to use a competitive, two-phase design-build selection process. In March 2001, the bill was re-referred to the Rules Committee. Until early January, no action on a bill for all Illinois park districts had taken place since then, though legislation permitting the Illinois Sports Facilities Authority to enter into a design-build contract for a new football stadium was passed in 2001. "The issue is being studied," said Dr. Ted Flickinger in late 2002, President and Chief Executive Officer of the Illinois Association of Park Districts. "It's not necessarily a burning issue for IAPD members, but the ability to use design-build has been brought to the association's attention. Districts would like to be able to take advantage of the method." Dr. Flickinger added that he remains hopeful design-build legislation will eventually pass. Construction industry lobbyist Bob Swaim said in November that the industry hoped to have legislation on design-build prepared for the January 2003 session. The legislation hopefully would affect all public bodies, said Swaim, president of the Public Affairs Group in Springfield, which represents the Construction Industry Alliance. "The industry hopes to bring together a coalition of public users, architects, engineers and contractors before moving forward with the legislation," said Swaim. "The problem we've come across is how to award a design-build contract and still stay within the state procurement code that requires competitive bidding." Design-build is becoming more and more popular in the public sector. The federal government allows the method. According to Mark Shambaugh, chairman of the Design-Build Institute of America, design-build is used by the U.S. Postal Service, the Army Corps of Engineers, the Federal Bureau of Prisons and the Federal Highway Administration. During the 2001-02 legislative session, 140 bills dealing with design-build were pending or passed in 31 states, according to a legislative update by G. William Quatman, a Kansas City attorney and licensed architect. He called design-build "one of the hottest topics in the 50 state legislatures" in 2002.

March/April 2003 19

And with design-build, there's a guaranteed maximum price, known upfront.

Coakley mentioned, as did Holzrichter, the problem of an architectural design that's out of sync with costs.

"There's nothing worse than having a really great design, and then the builder comes in and says, 'I can't build this,' or, 'it will cost 10 times more for that.' Then the contractor says, 'Too bad you didn't talk to us sooner. You could have used this material instead. It's stronger and it gives you the same appearance, but it costs a lot less.'

"If they work together, the contractor and architect can catch those things early in the design process." Quality is preserved, and money is saved, said Coakley.

There are caveats. Coakley recommended careful review of the scope of work and being specific about materials, if that's an issue.

A contract might specify a general level of quality for cabinets or windows, for example. "Most cities and park districts are doing modest projects," he said. "If you want higher-grade or energy-efficient windows, or woodwork in the board room, you have to specify that."

He also recommended selecting an expert building inspector who's well versed in construction or hiring an outside consultant to act as the owner's representative.

"No construction method is perfect," he said. "There will always be questions, concerns and minor problems in any construction project."

Coakley's first rule: Always deal with a quality company. Check references and hire a good solid firm.

It's said that the ancient pyramids were constructed with design-build. Do certain, high-profile projects lend themselves more to design-build than others?

"I think just about anything can be done by design-build," Hoizrichter said. "Anything you want built can be built with design-build," concurred Leppert of PHN Construction.

Only time will tell if that "anything" will include park district facilities.

Beth Bales is a writer affiliated with PHN Architects, which specializes in the design of recreational facilities such as golf course clubhouses. recreation centers and aauatic centers. See www.phnarchitects.com.

20 Illinois Parks and Recreation