CMM Infrastructure & Capital Projects 3 — Questions and Answers
Question 1: A municipality wants to leverage private investment for a new parking garage without taking on debt. Which financing model is MOST appropriate?
- General obligation bond
- Public-Private Partnership (P3) (Correct answer)
- Tax Anticipation Note (TAN)
- Special Assessment District
Correct answer: Public-Private Partnership (P3)
Public-Private Partnerships allow private entities to finance, build, and operate infrastructure in exchange for revenue streams, reducing municipal debt obligations.
Question 2: What is the primary purpose of a project charter in municipal capital project management?
- Authorizing the project and defining its objectives, scope, and stakeholders (Correct answer)
- Establishing the final construction budget
- Selecting the design-build contractor
- Documenting punch-list items at project completion
Correct answer: Authorizing the project and defining its objectives, scope, and stakeholders
A project charter formally authorizes a project, defines its scope and objectives, and identifies key stakeholders and the project manager's authority.
Question 3: Which risk transfer mechanism protects a municipality from a contractor's failure to complete a construction project?
- General liability insurance
- Performance bond (Correct answer)
- Builder's risk insurance
- Professional liability (E&O) insurance
Correct answer: Performance bond
A performance bond is a surety bond that guarantees the contractor will complete the project per contract terms; the surety steps in if the contractor defaults.
Question 4: A city's infrastructure condition assessment gives its roads an average Pavement Condition Index (PCI) of 45. What maintenance strategy is MOST cost-effective?
- Full reconstruction of all roads immediately
- Preventive maintenance on best roads, rehabilitation on fair roads, reconstruction on poorest (Correct answer)
- Defer all maintenance until PCI drops below 25
- Apply seal coat uniformly to all road segments
Correct answer: Preventive maintenance on best roads, rehabilitation on fair roads, reconstruction on poorest
A tiered strategy preserving good roads, rehabilitating fair roads, and reconstructing only the poorest maximizes pavement life per dollar spent.
Question 5: What is a 'shovel-ready' project in the context of federal infrastructure funding programs?
- A project that has received community input but lacks engineering plans
- A project with completed design, permits, and environmental clearances ready to begin construction (Correct answer)
- A project in the early feasibility study stage
- A project approved by the city council but not yet designed
Correct answer: A project with completed design, permits, and environmental clearances ready to begin construction
Shovel-ready projects have completed pre-construction requirements (design, permits, environmental review) and can begin construction immediately upon funding award.
Question 6: Under the Davis-Bacon Act, what wage requirement applies to federally funded construction projects?
- Workers must be paid minimum wage set by the state
- Workers must receive locally prevailing wages and fringe benefits as determined by the Department of Labor (Correct answer)
- Workers must be paid union scale regardless of location
- Contractors set wages through competitive bidding
Correct answer: Workers must receive locally prevailing wages and fringe benefits as determined by the Department of Labor
The Davis-Bacon Act requires contractors on federally funded projects to pay workers the locally prevailing wage rates and fringe benefits determined by the U.S. Department of Labor.
Question 7: Which technique in capital project scheduling identifies tasks that, if delayed, would extend the overall project completion date?
- Work Breakdown Structure (WBS)
- Critical Path Method (CPM) (Correct answer)
- Earned Value Analysis (EVA)
- Monte Carlo simulation
Correct answer: Critical Path Method (CPM)
The Critical Path Method identifies the longest sequence of dependent tasks, where any delay directly extends the project's total duration.
CMM Infrastructure & Capital Projects 3
A municipality wants to leverage private investment for a new parking garage without taking on debt.
Which financing model is MOST appropriate?