Volume: 4, Issue: 14 - 04/10/2015
By Bruce Jervis
Construction contracts universally state that specified equipment and materials must be new. Used or refurbished goods are contrary to the concept of constructing a new facility or renovating an existing one. In federal construction contracts, the mandate is found in the “Materials and Workmanship” clause. Virtually all contracts – public and private – include the same requirement. Read more.
Knowing the Numbers
Last issue covered many aspects of appropriate and necessary project controls and how they relate to the overall profitability of the contractor. This issue introduces various approaches to job cost control.
Controlling cost in construction is a constant battle and the approaches are as varied as the contractors. In the early 70s, a well-known successful heavy/highway contractor had very detailed costs on every job, and compared costs to budgets in great detail – in spite of the fact that it was done with an NCR mechanical posting machine! One of the contractor’s major competitors, equally successfully, got the jobs done with no detailed cost reports and no project budgets. The “old man” just knew. He could walk the job and figure out what it should cost and he could watch the machines at work and he just knew whether he was making money. Read more...
Volume: 4, Issue: 13 - 04/03/2015
By Bruce Jervis
Unforeseen site conditions are easy to allege but difficult to prove. Under a typical differing site condition clause, a physical condition is compensable under either of two circumstances. The contract documents made an affirmative representation, relied upon by the contractor, which proved to be inaccurate. Or, the condition is so unusual for the location that it could not have been reasonably foreseen. Proving the latter can be particularly challenging. Read more...
In the March 20 issue of ConstructionPro Week, we reported on changes in the February 2015 update of the “Project Schedule” clause of The Unified Facilities Guide Specifications (UFGS). This week we look at the first of two other schedule specification updates - UFGS-01 32 16.00 20 - Small Project Construction Progress Schedule. Specifically targeted for design-bid-build projects, the new spec reflects changes to keep up with newer scheduling software as well as set criteria for dealing with delays. Read more...
The term "project controls" means different things to different people depending on their perspectives. Depending on your role in the project, it could mean financial controls (the CFO or controller), management controls (the project manager), or physical controls (the superintendent or field foreman, for example).
If you are the superintendent, you are most interested in controlling the flow of personnel and materials to ensure that people are able to work productively on a day-to-day basis.
Volume: 4, Issue: 12 - 03/27/2015
By Bruce Jervis
Liquidated damages are assessed against contractors for late completion of a project. They are intended to compensate project owners for the costs of an extended construction period and the delayed use of the facility. Liquidated damages clauses are generally enforceable if the daily rate represents a reasonable forecast, at the time of contract formation, of the owner’s actual costs. If the daily rate is arbitrary – merely an incentive for timely completion by the contractor – the clause may be ruled an unenforceable penalty.
On public works projects, the determination of the daily rate of liquidated damages is controversial. Public project owners do not have construction loans. Completed public projects do not generate revenue. What are the owner’s costs of late completion? They are primarily extended inspection and administration costs. Read more.
Last month in ConstructionPro Week, we presented an overview of the results of our January 2015 Estimating Survey, including methods used to perform take-offs, sources of cost/pricing data, use of technology and overall satisfaction ratings. The survey also asked readers to share three best practices for developing a solid estimate. Here’s what we learned: ... Read more.
Software Advice, an online service intended to help match prospective buyers to software companies, has conducted its own surveys over the past few years. In 2013, it reported that 49% of its survey participants used spreadsheets, supporting ConstructionPro Network’s findings (17% of respondents still prepare an estimate manually, with 46% using a spreadsheet and 31% using an estimating program). Read more.