Improving the Accuracy of Early Cost Estimates for Federal Construction Projects (1990) / Chapter Skim
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Factors Other than Estimates that Contribute to Budget-Related Problems
Factors Other than Estimates that Contribute to Budget-Related Problems
Pages 7-14
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From page 7... ...
This chapter includes a brief review of the design and construction process, a discussion of the keys to a successful project, and committee suggestions on some procedural steps agencies might take to help improve their success rate with construction projects. ELEMENTS OF THE CONSTRUCTION PROCESS The ultimate goal of federal agencies when procunng construction is to acquire cost-effective facilities that meet the needs of the users within the budget available (i.e., the amount authorized by Congress)
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From page 8... ...
Identification of User Needs Id federal agencies and other large organizations with continuing construction programs, the fast step in the facilities acquisition process usually is the identification of a facilities need by an operational element of the organization (i.e., a user)
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From page 9... ...
If an estimate indicates that construction costs will be over budget, the designer and/or the owner can take various actions to reduce costs, such as performing a value engineering analysis, eliminating some nonessential items, making some items bid alternates, or reducing the size or level of quality of the facility. Estimates based on relatively detailed plans and specifications are called construction document estimates.
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From page 10... ...
Accurate Definition of User Needs Inasmuch as the ultimate objective of a construction project is to obtain a facility that satisfies the needs of one or more user organizations, a clear understanding of the needs of prospective users obviously is one factor in the success of a project. Until an accurate statement of user needsT has been developed, any design work performed on a project is likely to be of little value, and in the absence of compensating errors, estimates based on erroneous assumptions about user needs inevitably will be wrong.
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From page 11... ...
The committee believes that federal agencies skill experience problems caused by inaccurate statements of user needs, in spite of their good intentions, for one or more of the following reasons: · Insufficient time to perform a proper analysis. The budget preparation cycle in the federal government requires agencies to submit budget requests by specific dates.
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From page 12... ...
. Clear and accurate construction documents are essential for controlling cons~uction costs because construction contractors invariably react to contract ambiguity either by increasing their bids to cover their uncertainty about the precise nature of products or services desired or by submitting numerous requests for contract changes and extra money after the contact is awarded.
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From page 13... ...
To the committee's knowledge, most federal agencies recognize the importance of involving their employees in the planning and management of construction projects. However, the committee also Is aware that agencies are under continuous pressure to reduce staff levels and to rely on the private sector as much as possible, and the committee believes that some federal agencies might in the future be tempted to reduce federal employee involvement in their design and construction programs below the minimum levels needed for effective control.
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