Design-build has become the fastest-growing delivery method in the water/wastewater industry across the nation. Cost certainty and accelerated schedules have encouraged most states to embrace the design-build model. In the current market, large-scale design-build projects receive most of the headlines, but design-build can be a perfect fit for your small-scale projects.
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The word “innovative” is talked about a lot in the water and wastewater industry, but as an industry we have been slow to accept technology innovation. I have been in the industry for 30+ years and participated in several industry efforts with WEF, AWWA, NSF, and EPA—like the EPA’s Environmental Technology Verification (ETV) program, WEF’s LIFT program, etc.—to increase the use of innovative and new technologies. These programs typically test the equipment through a range of conditions and a report is written on the testing. Testing the full range of conditions that technologies might experience is virtually impossible in the water and wastewater industry since the influent conditions are constantly changing. The major difficulty in gaining the acceptance of new, innovative technologies has involved state-by-state regulatory approval, with some engineering firms and utilities not wanting to be early adopters due to the believed risk of failure and local bidding requirements.
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The ongoing COVID-19 pandemic has had a significant impact on the continued development of critical infrastructure, creating growing uncertainty concerning financing opportunities and project delivery. The water industry has not escaped this reality, and for municipalities that already struggle to find financing opportunities the situation is more dire. Due to a reduction in commercial water use throughout 2020, the water industry faces more than $13 billion in annualized revenue losses across the U.S. This is forcing municipalities that would normally finance critical infrastructure projects through more traditional bond measures to look for new avenues to deliver necessary infrastructure upgrades.
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I have always been perplexed as to why dispute boards are so rarely used on water/wastewater projects. They enjoy a long history of successful use on transportation projects – particularly tunneling projects and big-dollar design-build projects. Most transportation owners find dispute boards helpful, and it is clear that they provide the parties with a vehicle to get real-time resolution of project challenges. But it seems that water/wastewater owners and owner advisors don’t even give a thought (let alone a second thought) to considering the use of a dispute board when they put together their contracting approach for a non-tunneling project. And why haven’t design-build teams pushed owners to use them on complicated, big-dollar design-build water/wastewater projects, as their counterparts in the transportation industry have done?
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Tower cranes flying materials for a high-rise in the downtown skyline. Excavators and loaders moving dirt and installing pipe along the side of the road. Bridges flying over a freeway one berm at a time. What is it that attracts people to the architecture/engineering/construction industry? Is it seeing those construction projects in action? If so, what aspects of that work entice someone to think about making that a career? At what age do those scenes resonate enough for someone to even start daydreaming about the industry?
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Most major construction projects in the water and wastewater industry have conventionally been delivered through a design-bid-build (DBB) method of delivery. However, collaborative project delivery (CPD) methods are being considered more frequently in the public sector because they can provide a variety of benefits over traditional delivery methods such as time and/or cost savings. It is important to recognize that these benefits sometimes come with trade-offs, such as reduced control or change in risk, so the pros and cons of each CPD method need to be weighed.
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Remember the Yugo? Wikipedia reminds us that you could buy one of these imported cars brand new for $3,990 in 1987.2 That’s about $9,1003 in 2020 dollars — about a third less than the least expensive new car that you can actually buy today (which, according to Automobile Magazine, is a 2020 Chevrolet Spark LS for $14,395,4 if you happen to be in the market). A thirty-plus percent discount isn’t bad for a brand new car — it sounds like a great deal! Wouldn’t it be great if local governments and utilities paid as much attention to the competitive market? Wouldn’t ratepayers benefit from responsible budget management, competitive pricing, and efficiency?
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Compared to the traditional design-bid-build method, design-build delivery can accelerate design and construction schedules by 20% to 30%. Many cities and counties have implemented new fast-tracked permitting review processes to reduce the turnaround time for issuing permits, which are critical to maintaining the construction schedule.
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A growing number of utility managers and influencers in the wastewater sector are transitioning to an operating model that mirrors private industry. One of the leading reasons for this shift is the fact that major infrastructure has not received the investment needed to keep pace with a changing economy and environment, let alone innovations in technology. To bridge the gap between their current operations and this new model, utilities are frequently turning to progressive-design build.
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When considering a project delivery approach, municipal owners may be reluctant to choose a collaborative-delivery method. Design-bid-build (DBB) has been the standard approach in public works contracting, so changing to a different approach can be challenging and uncomfortable. Some owners may fear that they have less influence with a collaborative-delivery approach than they do with DBB. Owners still maintain influence throughout collaborative delivery but will exert that influence differently than with DBB. This influence starts with the procurement documents and is memorialized in the design-build (DB) contract.
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