Project Management Central

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Topics: Construction, Procurement Management, Scheduling
Part 1 - Why do Government Capital Projects Take So Long?
Network:502



Requirements for funding from the government as well as operating regulations affecting publically bid contracts mandate time lines that even when optimized are much longer than anticipated or reasonably expected by the public.

The newspapers are full of stories on the recovery from hurricanes and major storms, and most recently with the October 2012 anniversary of Super Storm Sandy, which made land fall on the US east coast and produced billions in damage to homes, businesses and infrastructure. While most of the stories are about private property owners, there are also stories of government projects that are still making steady progress.

While political will may demand, may increase optimization, and may modify processes to expedite project work, government laws, the Owner’s internal checks and balances, and the Owner’s organizational procedures typically require a structured non-flexible set of processes that have far greater impact on project durations than the size of the project scope.

So why does it take so long?

For the typical capital project, there is a planning phase, design phase, pre-construction phase and a construction phase for defining, funding, executing and completing the project deliverables.

Planning phase is a systematic business Owner’s process involving asset identification, condition surveys, analysis of asset useful life, anticipated needs date verse operating expenses, and summary of scope for future project work. Planning is a predecessor to the design phase – event for project work created from unplanned events such as hurricanes and super storms.

The planning is normally done well in advance of the availability of funding for the work, which for government project occurs in five year increments. The planning phase is normally finished 12-24 months before start of the design phase to finalize project selection and budget allocations, process and obtain funding grants, and to for Owner’s to authorized the start of project work. For storm recovery, the process took 6 month before initially funding from the government.

Design phase is a recurring capital project process within the Owner’s organization involving a internal experts or a consultant to identify design requirements (Scope of Work), conduct meeting with the Owner’s technical experts and to prepare the technical drawings and specifications that are part of construction contract document for bidding. The design phase is started after the planning phase and before the construction phase.

Defining the consultant’s scope and deliverables and soliciting and awarding a design contract requires a minimum of 5 months, including one month for SOW, 1-1/2 months to solicit proposals and pricing, one month to review proposal and negotiate a price with the selected consultant, and one month to obtain other approvals for government contracts.

After the consultant starts work, the preparation of a contract document will take 9-12 months depending on SOW. From start to finish the design phase could be 14-18 months (min).

For storm recovery, the process took closer to 18 months due to new requirements for independent best value design, interpretation of requirements for accommodating future storm events and for analyzing protection of various operational critical assets.

Pre-Construction phase is an interactive period involving the Owner and outside regulators, permitting agencies and governments’ management oversight regarding environmental impacts and assessments, code compliance enforcement, construction permits, contract procurement and delivery methods, and community and government outreach programs. During this phase, the Owner will determine the impacts to the annual business commitments, long term business plans and on-going operations and organizational staffing levels. While this phase can start before the finish of the design phase, the finish of pre-construction is required before the start of construction phase.

Depending on the project scope, this phase can range from 3 months to many years before the start of the construction phase.

Construction phase is the execution period involving the procurement of a construction contractor, contractor start-up and submittal period, and the contractor scheduling and performing the work as outlined by the contract terms and conditions, which define deliverables and milestone schedule.

As with the design phase, the procurement of a contractor is determined by the Owner’s internal processes as well as the government conditions for funding grants. The process requires a minimum of 4-7 months depending on solicitation method – invitation for bid or request for proposal, including 1-1/2 months to solicit bids, 1 – 2 months to evaluate bids or proposal documents, and 2 months to present and obtain other approvals for government contracts.

During this phase the Owner’s or designee, coordinates and manages the contractor’s work for compliance to the contract. The duration of the contract and critical calendar dates are determined from the date of contract award, and dependent of the scope and availability of work areas to the contractor. Owner’s and their design consultant/engineer of record use best judgment to establish and validate reasonable durations for completing the contract scope within industry standards, best practices and record of project experience.

Depending on the project scope, this phase can range from 15 month to many years before achieving use of the construction deliverable.

For storm recovery, the process took closer to 24 months due the need added time to coordinate track outages under restrictive work hours that are required to maintain scheduled service along the work area.

Without accounting for the unique scope, the optimum duration for a commuter rail design and construction project is 54 months (min), which allows for 12 months planning, 19 months designing and preparing a construction contract, 3 months pre-construction, and 20 months for construction. For the on-going storm recovery, the overall duration of a project involving a branch-line signal system is currently tracking at an estimated 61 months.
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Network:100064



Excellent
sound like what I see also
Thanks
Network:0



Besides lack of common sense and extra complicated & long bidding and awarding processes, our government is copying the lean and very mean 3G business model to “save” cost but they forget PEOPLE. People who do the work are the most important assets. If contractors do not been treated as one of the “team members”, no proper rewards or punishments, they will not have the ownership warm fuzzy feeling toward their projects.
Network:374



The City of Las Cruces is mandated by its Charter to have a 5 year Capital Improvement Plan. The Plan is somewhat regulated by the State of New Mexico. Simply. the City has to show the State how it's spending any state funds that are received. Since the City is a home rule administration, it can create any capital improvement plans it deems necessary without having those plans approved.

Depending on the project, public input is part of the design and planning phase of the project. Is there a street extension? Public input. Is a road being repaved and repaired? No public input.

The biggest hurdle for any of these major Capital projects is funding. Are there matching federal or state funds? What is the inflation rate if the project isn't slated to start in 3 years?

I know each public administration operates differently, but I suspect these are the same issues every local government faces .
...
1 reply by Henry Hattenrath
Nov 15, 2017 7:14 PM
Henry Hattenrath
...
Ed - Thank you for the input. Political and public influence can affect all phases of a project. Lack of funding will delay the start of project activities and depending on the approved grant plan, delays after project initiation can occur until funds are available.
Network:502



Nov 15, 2017 2:53 PM
Replying to Ed Tsyitee Jr
...
The City of Las Cruces is mandated by its Charter to have a 5 year Capital Improvement Plan. The Plan is somewhat regulated by the State of New Mexico. Simply. the City has to show the State how it's spending any state funds that are received. Since the City is a home rule administration, it can create any capital improvement plans it deems necessary without having those plans approved.

Depending on the project, public input is part of the design and planning phase of the project. Is there a street extension? Public input. Is a road being repaved and repaired? No public input.

The biggest hurdle for any of these major Capital projects is funding. Are there matching federal or state funds? What is the inflation rate if the project isn't slated to start in 3 years?

I know each public administration operates differently, but I suspect these are the same issues every local government faces .
Ed - Thank you for the input. Political and public influence can affect all phases of a project. Lack of funding will delay the start of project activities and depending on the approved grant plan, delays after project initiation can occur until funds are available.

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