Infrastructure & Public Works Blog : San Francisco Infrastructure Lawyer & Attorney : Hanson Bridgett Law Firm : Public Works Construction : Sacramento, Marin County, Northern California

On August 8, 2011, the 1st District Court of Appeal broke new ground when it published a decision holding that Phase 2 of the Presidio Parkway project can move forward as a public-private partnership (P3). The Presidio Parkway Project is the first project to reach award under California’s new public-private partnership statute, Streets and Highways Code section 143. The project was challenged on three separate grounds by the Professional Engineers in California Government (PECG), an engineers' union. The Court of Appeal affirmed the trial court's ruling approving the California Department of Transportation's (Caltrans) use of the new statute, and should encourage the consideration of P3s as a project delivery method in California.

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I just came across this short video regarding Disney's use of Building Information Modeling on the construction of their new Fantasyland.  It demonstrates the benefits of BIM in a little over 3 minutes.  Watch it here.

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The use of design-build in the public sector appears to be growing.  As more public agencies achieve positive results with this project delivery method, the legislature appears to be more comfortable with expanding the statutory authority.  My colleague, Lisa Dal Gallo, and I recently co-authored an article about this trend as well as the many benefits of design-build.  Click here for a copy of the article.

 

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The Professional Engineers in California Government, the union representing state engineers, has filed suit to stop the project to replace Doyle Drive, the 1.6 mile highway that connects the Golden Gate Bridge with the City of San Francisco. The lawsuit alleges that the project impermissibly uses a Private Public Partnership (P3) contrary to the State law authorizing the project. Instead, the engineers union asserts that the project should be awarded to the lowest bidder pursuant to a traditional design-bid-build process, with the design component being performed by State engineers.  Under the current arrangement, Hochtief Concessions and Meridiam Infrastructure will design, construct, operate and maintain the road. 
 

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On October 11, 2009, Governor Schwarzenegger signed into law AB 729 (Evans) extending the sunset date on the design-build statute applicable to public transit operators to January 1, 2015.  The full text of the bill can be reviewed here.  This marks the second extension of the sunset date.  The transit operator design-build statute was adopted in 2000 pursuant to AB 958 (Scott), and included a sunset date of January 1, 2005.  In 2006, pursuant to AB 372 (Nation), the sunset date was extended to January 1, 2011.  It appears that the California Legislature is gaining comfort with design-build in the public sector.    

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On October 11, 2009, Governor Schwarzenegger signed into law AB 729 (Evans), revising the design-build statute applicable to transit operators.  AB 729 extends the authority of public transit operators to use design-build contracting from January 1, 2011 to January 1, 2015.  We interpret this to mean that transit operators must award, but not complete, a design-build contract prior to this date.  

 

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A controversial new state law introduced by Sen. Elaine Alquist and approved by the Governor in October 2009 will make it easier for the City of Santa Clara to facilitate construction of a new football stadium for the 49ers.  Senate Bill 43 creates a new joint powers authority, the Santa Clara Stadium Authority, which will be exempt from the City's competitive bidding rules and is authorized to award a design-build contract for the new stadium.   

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On October 22 and 23, 2009, the Harvard Graduate School of Business and Graduate School of Design jointly sponsored a symposium on Integrated Project Delivery (IPD). IPD is a project delivery method where all of the key participants (owner, contractor, designer and key subcontractors) are engaged at project commencement to collaboratively design, develop and execute the project. Participants’ compensation is based on overall project outcome, measured against an agreed target cost, and liability within the IPD group is waived or greatly reduced. IPD has produced exceptional results in healthcare, and more recently, in a range of commercial and institutional projects.

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In a word, yes.  Most public agencies are required to award their public works construction projects to the lowest responsive, responsible bidder.  Failure to comply with public bidding requirements can result in a legal ruling which can void the contract.  However, there are also a variety of alternative project delivery methods (design-build, construction manager at-risk, job order contracting, public-private partnerships, lease lease-back etc.) that are available for select public agencies to use for qualifying projects.  The difficulty is that the statutes which authorize these alternative project delivery methods are not organized in any logical fashion.  I recently prepared a paper summarizing the main alternative project delivery methods available to public agencies in California, with a chart at the end that provides statutory references.  The paper was included with the materials at the Integrated Project Delivery Seminar Series.  In addition, the paper was included with the materials at the Lean in Public Sector Construction Projects Workshop and served as the basis for a presentation I gave on the topic.  You can view a copy of the paper by clicking here. 

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Governor Schwarzenegger recently signed three bills which will expand the ability of cities, transit operators and the Sonoma Valley Health Care District to award projects on a design-build basis.  Each of these agencies is generally constrained by public bidding requirements to award construction contracts separately from contracts for professional design services.  These agencies will now have a greater ability to take advantage of a useful project delivery alternative for some projects.  The three bills are summarized below:   

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A new bill authored by Doris Wolk would expand the authority to award projects on a design-build basis to all cities, as well as to projects by any “qualified entity” for local or regional wastewater facilities, solid waste management facilities, or water recycling facilities. The bill, AB 642, has passed both the state assembly and state senate, but still awaits the signature of Governor Schwarzenegger. Assuming he signs the bill, the expanded design-build authority would go in to effect on January 1, 2009.    

 

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Governor Schwarzenegger recently announced a plan to promote public-private partnerships in order to meet California’s long-term infrastructure needs. (See Los Angeles Times article.) Public-private partnerships are contractual agreements which are formed between public agencies and one or more private companies whereby the private company finances, builds and manages public facilities for a specified period of time.

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Earlier this month, the American Institute of Architects California Council ("AIACC") and the American Institute of Architects ("AIA") jointly published a comprehensive new guide to Integrated Project Delivery methods.  The document is entitled "Integrated Project Delivery: A Guide," and can be downloaded here.  The Guide marks an exciting step forward in the development of Integrated Project Delivery concepts and making IPD a viable alternative for the construction industry.   

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At the AIA National Convention in San Antonio on May 2, the AIA California Council issued an intriguing working definition of "Integrated Project Delivery."  The goal of Integrated Project Delivery is to approach construction projects in a more collaborative way, taking advantage of technological tools such as Building Information Modeling.  Click here to view the document published by the AIACC. 

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The National Institute of Building Sciences (NIBS) recently issued the version 1.0 draft of the National Building Information Modeling Standard (National BIM Standard).  The National BIM Standard has been in the works for over four years, and is a collaboration between over 30 subject matter experts throughout the capital facilities industry.  An industry review and comment period is now in effect until May 21, 2007.  

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On September 14, 2006, the Governor signed AB 372 expanding design-build authority for transit operators by revising Public Contract Code sections 20209.5, 20209.7 and 20209.14. Transit operators interested in utilizing the design-build authority for future projects will welcome the useful changes, which include the following: Continue Reading...

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Building Information Modeling (BIM) utilizes computer technology to represent building structures and systems in terms of functional, as well as graphical attributes.  This technology may some day change the nature of collaboration between design professionals and contractors on construction projects.  This article examines the benefits and challenges of implementing Building Information Modeling.  Click here for the full article in adobe PDF format.

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Pursuant to three separate bills, the state legislature expanded existing statutory authority to award construction contracts on a design-build basis to apply to more cities and counties as of January 1, 2006. In each case, the duration of the statutory design-build authority was extended to the year 2011, and the dollar threshold was lowered to $2.5 million per project for counties. Following is a short summary of the bills:

·        AB 1329 (Wolk): This bill added section 20175 to the Public Contract Code, and authorizes cities in the counties of Solano and Yolo to award construction contracts on a design-build basis. The authority only applies to buildings and directly related improvements, and does not apply to streets, highways, public rail transit, or water resources facilities and infrastructure. The statute has a sunset provision for the year 2011.

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http://www.bart.gov/about/projects/oacnews.asp

On February 13, 2006, the San Francisco Bay Area Rapid Transit District (“BART”) issued an advanced notice of a Request for Qualifications for the design, build, finance, operation and maintenance of a three-mile connector railway between the existing Coliseum BART station to the Oakland International Airport.

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