Associations and State Government and Professional Organizations and Architecture/Design and Government and Real Estate & Retail

Indiana architects seek changes to public project bidding

October 8, 2011

Architects bidding on public construction projects say they’re often spending too much time and money chasing work they ultimately might not receive, and want lawmakers to consider whether changes are needed in the bid process.

Legislation passed in 2005 allowed public buildings to be constructed using what the industry calls the “design-build” delivery system. Widely used in private projects, design-build is promoted as an efficient building method in part because a project’s design and construction are included within one contract.

That differs from the traditional way of completing a project under what’s known as “design-bid-build,” in which designers and architects work under separate contracts.

Now that design-build has been available to owners of public projects for more than five years, its flaws are becoming more apparent, architects say. They often spend months navigating the bid process with no guarantee they’ll be awarded the contract.

In Indiana, public projects can only be built using the design-build or design-bid-build processes.

The Indiana chapter of the American Institute of Architects wants to form an independent study group to further explore public project delivery methods and could make recommendations to the General Assembly.

Specifically, AIA wants to expand the bid options to include more than just the two, said Dan Mader, an architect at the Indianapolis office of Celina, Ohio-based Fanning Howey Associates Inc.

“If we’re going to have two choices, we should have four or five,” Mader said. “We need to match up the delivery system that works best for [owners and architects] and not just have two to pick from.”

Another popular option available in many states but not in Indiana is “construction management at risk.” That’s when a construction manager takes on financial obligations for construction instead of the project’s owner, under a specified cost agreement. The architect is hired under a separate contract.

Yet design-build has gained popularity in recent years in both the private and public sectors mainly because of the single contract for both design and construction.

Owners are convinced design-build is more cost-effective due to fewer change orders, and contractors like it because it enables them to control construction and design.

Under design-bid-build, a project owner such as a school district puts out a request for qualifications in which responders are whittled to three by a technical review committee. Then each of the three replies to a request for proposals before one firm is selected.

Architects’ rub with the process is that they’re spending loads of time and money competing for a project with no guarantee they’ll get it. They contend design-build is less of a hindrance on private projects because those often are less complex and don’t require as much time and money to prepare.

Architects argue, however, that design-build enables project owners to get a lot of free design and cost information before selecting a firm.

“The whole basis of the architects’ argument is the amount of risk in trying to get the project,” said Jim Schellinger, a managing partner of Indianapolis-based CSO Architects Inc. CSO is the architect for Hamilton Southeastern School District’s $62 million project that calls for a $2.5 million conversion of its junior high into a freshman center and constructing a $37.5 million junior high and $22 million elementary school.

All three firms in the final running for the project spent hundreds of thousands of dollars, said Schellinger.

Worse for CSO, the firm had to continue forward on the Hamilton Southeastern project even though a referendum last November to increase property taxes to fund the expansion could have failed.

“If the referendum would not have been approved,” Schellinger said, “we would have been out close to $1 million.”

The General Assembly took steps to improve the design-build process last session by mandating that school districts wait until after a referendum passes to issue a request for proposals.

“It’s not that we’re against design-build,” Mader said. “In some projects, when it’s easy to see the size and scope, it makes sense. But schools are complex.”

Indeed, Indianapolis Public Schools is in the third phase of an $832 million capital improvement campaign set to finish in 2014.

Indianapolis-based Schmidt Architects is the administrator for the IPS project, and has used design-build for just one project—a $4 million renovation of an elementary school a few years ago, said Deb Kunce, program manager for the firm.

“Ultimately, it’s the owner’s decision,” she said. “But I feel pretty strongly that the design-bid-build system that [Indiana has] had has been good for a number of years.”•

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