Design-Build Contracting Approaches Flashcards
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In a stipulated sum (lump sum) design-build contract, who bears the financial risk if construction costs exceed the agreed price?
Answer: The design-builder
Under a stipulated sum contract, the design-builder assumes cost risk and must complete the project for the fixed price regardless of actual costs.
Which procurement method requires design-build teams to compete primarily on qualifications and approach rather than price?
Answer: Qualifications-based selection (QBS)
Qualifications-based selection evaluates teams solely on experience, technical approach, and past performance, excluding price as a selection criterion.
A 'bridging' design-build approach is best characterized as:
Answer: The owner develops partial design documents used as the RFP basis, then a design-builder completes design and construction
Bridging uses an owner's criteria professional to develop preliminary design documents that define scope, which design-build proposers then use to price and complete.
Under a Cost-Plus-Fee design-build contract, the owner's primary financial protection mechanism is typically:
Answer: A Guaranteed Maximum Price (GMP) provision
A GMP caps the owner's financial exposure in a cost-plus arrangement by setting the maximum amount the owner will pay for the project.
Which of the following is a key advantage of the design-build delivery method over design-bid-build for owners?
Answer: Single point of responsibility for design and construction
Design-build consolidates design and construction responsibility under one entity, eliminating the finger-pointing that can occur between separate designers and contractors.
In design-build contracts, a 'teaming agreement' between a designer and contractor before RFP submission primarily serves to:
Answer: Define roles, responsibilities, and compensation within the design-build team
Teaming agreements establish the framework for how the design and construction partners will collaborate, share work, and allocate compensation during pursuit and project execution.
Which contract pricing approach provides the owner the most cost certainty while incentivizing design-build efficiency through shared savings?
Answer: GMP with shared savings provision
A GMP with shared savings caps owner cost exposure while incentivizing the design-builder to find efficiencies by splitting any savings below the GMP.