U.S. Military Delivering Smarter Construction

By William J. Angelo

In an age of instant response and global commitments, the American military is discovering that smart construction is just as important as smart bombs. And providers of design-build services are finding new targets of opportunity.

The Army Corps of Engineers in 1999 to 2002 virtually doubled its design-build work, jumping from $1.1 billion to $2 billion. "Design-build is a mature and trusted delivery system," says Dwight A. Beranek, deputy director of military programs. "Now we’re trying to improve the acquisition method and broaden the scope with more front- and tail-end activities."

Beranek says design-build is rarely used for civil works because of funding issues, although at least six pilot projects now are under consideration. But it provides seamless delivery for other military construction, such as barracks. "Our customers want more risk taken by single entities rather than a bunch of hand-offs," he says. "We’ll use design-build when we need to accelerate construction and when the scope is well understood and defined."

To facilitate better design-build delivery, the Corps now is using planning charrettes, pre-RFP team meetings and partnering at the program level. "Our policy is to use the right method for the requirement. As it turns out, design-build happens to fit in many cases fairly well," says Beranek.

The Naval Facilities Engineering Command, which manages construction for the Navy and Marine Corps, agrees. "From 1999 to 2000 is when we really started getting into design-build because of a new two-phase source selection process that basically allowed us to short-list," says Richard C. Viohl Jr., spokesman for NAVFAC’s chief engineer’s office. "Now, design-build is the dominant method for procuring Navy construction." The delivery system is not used for land acquisition, airfield pavement projects and hard-to-define first-time facilities, he says. But "having a team approach to construction yields the best product because you are not handing off someone else’s design, which eliminates finger-pointing and it’s also great for fast project execution," says Viohl.

"We’re doing about $417 million worth of design-build in FY 2003," says Robert M. Moore, chief, program management, Air Force/Installations Logistics Engineering. "That’s about 43% of our active duty program." Moore attributes design-build’s rise to the overall increase in average project cost, from $5.3 million to over $8 million during the last five years, and to congressional demands for faster execution. "We need a coordinated approach," he says.

Moore predicts that the Air Force’s use of design-build will continue to rise, both in its usual style and in the new "design-build-plus" format now being used for large regional housing contracts with pre-selected contractors.

But problems remain. RFPs require a hard bid. "With everybody else it’s a guaranteed maximum price with some give-and-take, so if we forget to include something, we have a problem," says Ted G. Fery, partner, VOA Associates Inc., Orlando. "Also, the lack of interaction is a real disadvantage to the user because we do a full schematic, almost 30% design, with a rendering and engineering drawings for most RFPs."

And the cost of obtaining the work is high. In some districts, design requirements are considerably greater and military stipends are rare. "We’ve won 24 projects totaling about $200 million in the last four years," says Thomas C. Matzke, VOA vice president. "We’ve also done about 60 proposals that cost about 5% to 10% of our proposed fee. Generally, the military prequalifies between three to five firms and that’s a lot of free design work that is taxing the industry."

The Corps is responding by standardizing RFPs and eliminating non-relevant specification details. NAVFAC is considering stipends, but has not yet found it necessary to ensure adequate competition. That agency also is minimizing submission requirements.