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Construction Management At-Risk Contracting

Contractors 2“Construction management at-risk contracting” has been used by private developers and school districts, but not usually for public entities such as cities and counties.  Recently, however, more public works departments have been utilizing the method for large, multimillion-dollar projects.

The city of Papillion recently used this method for its $8 million public works complex. The management at-risk contracting requires a general contractor to collaborate on the design process and keep a project on time and on budget in spite of fluctuating costs for materials, labor, or weather delays. The selected contractor is expected to be in the process from the beginning – working with developers, architects, or engineers. These services may include preparation and coordination of bid packages, scheduling, cost control, evaluation, or construction administration. This creates a great deal more certainty in managing costs and keeping to the set timeline. On this particular project, the construction manager said having this method equated to more accurate budgets and timetables, as well as an increased knowledge of the project before construction started.

Analysis of construction management projects have found that they are slightly more expensive than projects handled the traditional way. However, public projects following the traditional model typically are required to select the lowest bid, which is a requirement at-risk contracts can bypass. This method is best used for large projects with a short turnaround.

To read more on the city of Papillion’s use, see full article.

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