Homeland Security Minimizes Risk in High-Containment Facility Procurement

CMc Approach is Used with Complex Construction Projects
  • Exterior

    The service side of the building contains two loading docks, because a separate dock is required for forensic materials.

    Image courtesy of Perkins + Will.

  • Interior

    A typical lobby on a lab floor takes advantage of natural light.

    Image courtesy of Perkins + Will.

  • NBACC

    An architect’s rendering of the front view of the NBACC shows the single employees entrance on the right, and the windowless left side of the building, which contains the BSL-4 lab space.

    Image courtesy of Perkins + Will.

The Department of Homeland Security (DHS), which operates four national laboratories, is in the process of building a fifth, the National Biodefense Analysis and Countermeasures Center (NBACC), at Fort Detrick, Md. When the Department was created in 2003, DHS began occupying the facilities of existing departments, such as the Coast Guard and the Federal Law Enforcement Training Center, which came under its new purview. As the Department expands, its need for new facilities also grows; this is the first major project of its kind that the DHS has designed and constructed.

The $128-million, 158,000-gsf NBACC (70,000 nsf) will include 3,000 sf of BSL-2 space, 40,000 sf BSL-3E, 10,000 sf BSL-4, and 18,000 sf administrative space, and house 121 scientists. Congress created the NBACC to address shortfalls in the country’s biodefense capabilities. Its two-fold mission is to act in collaboration with the FBI and other intelligence agencies as the lead lab for bioforensics in the event of a bioterrorism attack, and to characterize biological threats to national security. Management of the project will be supported by DHS’s Federal Law Enforcement Training Center, which employs former members of the Centers for Disease Control who have expertise in biocontainment.

Sharing Risk with the Construction Manager

During acquisition planning, an owner must decide who will be trusted to shepherd a major construction project through to completion.

“We had considered some different methods of doing this,” says Bob Driggers, DHS’s contracting officer. “They included design-bid-build; design-build, where one contractor takes on the whole role; and construction manager, where a manager oversees the construction, but the government holds the major subcontracts. Then we looked at construction-manager-as-constructor, also knows as construction-manager-at-risk, or CMc. Complex construction projects with highly technical requirements are good candidates for CMc.”

In that scenario, one construction contractor is responsible for both management and construction of the project, beginning as early as possible in the design process, either at the same time as the architectural/engineering firm, or at least by the schematic design phase.

“With the NBACC project, by the time we got to 15 percent design, we had the construction contractor on board,” he says. “The earlier you can put them on board, the better off you are.”

The CMc delivery method is beneficial because it establishes collaboration between the designer and builder during the design phase and it allows construction to start before the design is complete, usually at about 70 percent based on a negotiated Guaranteed Maximum Price (GMP).

Both A/E and CMc fees are based on the estimated cost of construction, which is a known quantity from the beginning, says Driggers. The design contractor then designs to that cost, and the construction contractor proposes his preconstruction and construction-phase fees based on that cost.

The GMP includes three elements: the cost of the work itself; a fee, which includes the CMc’s overhead, profit, and commission on subcontracted work; and a contingency, which is the amount of money the parties agree is necessary to resolve change orders or missed scope.

“Only the cost of the work and the contingency are negotiated with the GMP,” says Driggers. “The fee is established in the base contract.

“The GMP is designed to put lots of risk on the construction contractor,” he continues. “If we are asking for a proposal at 70 percent of design, he is dealing with documents that are not complete.”

DHS also improved upon the CMc delivery method. For example, DHS designed the contract award to include two distinct steps: one was a contract for preconstruction phase services (payment for the CMc’s expertise during the design process), including a determination of general commissions, and the second was for construction phase fees (payment for the CMc’s management during the construction phase).

“We said in the solicitation that only the pre-construction phase fees would be awarded initially,” says Driggers. “We evaluated the proposed price based on the total of line items one (Preconstruction Phase Fees) and two (Construction Phase Fees), but we said we would only award line item one. We would accept line item two, but it would not be awarded until award of the GMP.”

If they couldn’t reach agreement on a GMP at that point, the CMc’s contract would have expired at the end of the preconstruction phase, and the DHS would have resolicited construction bids. That CMc would not have been permitted to bid for construction because of his inside knowledge of the project.

Develop and Maintain Strong Partnerships

A major benefit of the CMc delivery method is that it facilitates strong working partnerships among the owner, the A/E firm, and the CMc. For example, all three worked together as a team to choose the first-tier subcontractors.

“Very early on in the process, we held numerous meetings with the scientists who are going to be working in this building, so we got continuous buy-in from them, too,” says Driggers.

Driggers cautions that problems associated with having “too many cooks in the kitchen” can arise, and that the team can be overwhelmed with too many opinions and recommendations.

“I think that we mitigated a lot of that by having regularly scheduled project meetings with everybody at the table, and we were able to work through that,” he says.

DHS also tweaked how the CMc and the A/E work together. The design cannot proceed from one phase of the project to another until the CMc and the A/E cost estimates are reconciled to within five percent of each other. That restriction was stipulated right in the bid solicitations, says Driggers.

“There is no sense in going down the line and getting further and further apart on price,” he says. “As you go through these phases of cost reconciliation, your contingency gets smaller and smaller, as it should, because your design gets more complete and more precise.”

The CMc also can formulate a schedule well before the start of construction, increasing confidence that the project will be completed on schedule. In fact, it allows a project to be fast-tracked because construction can begin before the design is 100 percent complete. The CMc’s involvement in the design process, including constructability reviews, has the potential to dramatically reduce the number and cost of change orders during construction.

The flip side of that is that any delay in completing the design impacts not only the A/E, but also the CMc and subcontractors.

Lessons Learned

Driggers recommends using the best value process to select the best contractors.

“We used that process to select Perkins + Will as the A/E firm and Gilbane Building Company as the CMc, and authorized Gilbane to use the same process in choosing subcontractors,” he says. “We told them, ‘Look beyond price a little and consider past experience.’ It’s a bit of a double-edged sword, because you’re also trying to stay within budget.”

For the most part, subcontracts were awarded to the lowest bidder, but several subcontractors who bid higher were chosen on their merits.

Another lesson learned is to employ subject-matter experts for peer and design reviews.

“We had many peer-review sessions,” says Driggers. “The design team has PhDs as consultants, people with a world of experience with biocontainment.”

A typical question that a scientist in the lab might ask, but a designer might not consider, is the volume of available decontaminating fluid, in case there is an emergency and everyone needs to leave at the same time.

It is equally important to engage the stakeholders, whose input yielded measurable results in the design of the NBACC. The initial design had an even split among BSL-2, BSL-3E, and BSL-4 labs. But the scientists made it clear that they have a greater need for the more secure lab spaces, so the building will contain only five percent BSL-2, with 55 percent BSL-3E, and 35 percent BSL-4.

DHS also contracted with a company that specializes in value engineering, which led some of the discussions early on in the process. Every time they went through cost reconciliation, they went through more value engineering.

Finally, Driggers stresses the importance of the partnerships.

“We went through a very detailed partnering session very early on,” he says. “We had everybody who was going to be a player in this project there, and everybody bought into the whole concept. That was an important step in this process.”

One thing they are still working on is a method to get more input from the major subcontractors early on in the process.

“The designs are only at 70 percent when you’re asking the CMc for a GMP,” says Driggers. “He doesn’t have a contract for actual construction yet—only preconstruction phase services—so he’s not authorized to enter into any arrangements with subcontractors. He’s flying a little in the dark.”

Driggers says the input of the major subcontractors is vital, especially in large complex lab projects like this one, where the mechanical portion accounts for about $30 million, and the electrical accounts for about $18 million.

The DHS had four years to procure, design, construct, equip, commission, and move into the NBACC. Design began in March 2005 and is 100 percent complete, and construction began in September 2006. Move-in is expected in June of 2008, with a dedication ceremony in July, when the building will be substantially complete. The BSL-3 and the BSL-4 labs will be commissioned later that year, and the facility will likely be fully operational by February 2009.

By Lisa Wesel