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Facility Life Cycles and the Acquisition Process
To provide context for the task group's framework, it is important to understand
the concept of facility life cycles and the acquisition process as it is generally practiced
by federal agencies.
FACILITY LIFE CYCLES
Facilities pass through a number of stages during their lifetimes: planning, design,
construction, start-up, operation and use, renewal or revitalization, and disposal (see
Figure 2. 1~. Most facilities are designed to provide a minimum acceptable level of service
of 30 years. With proper maintenance and management, facilities may perform
adequately for 100 years or longer and may serve several different functions over that
time. The actual service life is dependent upon such factors as quality of design; quality
of construction; durability of construction materials and component systems;
incorporated technology; location and local climate; use and intensity of use; type of
operation and maintenance methods used; and damage caused by natural disasters and
human error (NRC, 1998~.
\/
5~°°-~P/4
\ \ 8b0-up
~ Figure 2-1 Facility life-cycle.
1 7
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Sustainable Federal Facilities
The total cost of facility ownership is the "total of all expenditures an owner wit!
make over the course of the building's service lifetime" (NRC, 1990). These costs will
include conceptual planning; design; construction; maintenance; repairs; replacements;
alterations; and normal operations, such as heating, cooling, lighting, and disposal. Of the
total ownership costs, design and construction expenditures, the so-called "first costs" of
a facility, will account for 5-10 percent of the total life-cycle costs. In contrast, operation
and maintenance costs will account for 60-85 percent of the total life-cycle costs, with
land acquisition, conceptual planning, renewal or revitalization, and disposal accounting
for the remaining 5-35 percent (NRC, 19981. ~
FACILITY ACQUISITION
Executive Order 13123 defines acquisition as
. .
acquiring by contract supplies or services (including construction) by and for the
use of the Federal Government through purchase or lease, whether the supplies or
services are already in existence or must be created, developed, demonstrated, and
evaluated. Acquisition begins at the point when agency needs are established and
includes the description of requirements to satisfy agency needs, solicitation and
selection of sources, award of contracts, contract financing, contract performance,
contract administration, and those technical and management functions directly
related to the process of fulfilling agency needs by contract.
The federal government has not established a government-wide process for
acquiring facilities, although it has established broad guidance through legislation and
regulations. Using this guidance federal agencies have tailored their processes to reflect
mission, culture, and resources. Thus, although agencies follow similar procedures to
acquire facilities, the steps in the procedure may not occur in exactly the same sequence
in all agencies nor will the steps necessarily be called by the same names. With these
caveats in mind, a general process for federal facilities acquisition is shown in Figure 2.2
and described below.
' The investment in facilities supports an even larger investment in human resources. Industry and government studies have shown
that the salaries paid to the occupants of a commercial or institutional building annually are of the same order of magnitude as the total
costs of designing and constructing the building (NRC, 1998).
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Facility Life Cycles and the Acquisition Process
Requirements
assessment
~ ~ ~ , ~
Conceptual Programming/ _
planning budgeting
Lit
Programming/
budgeting
FIGURE 2-2 General facility acquisition process.
~ - -
19
Design
. .
I Construction
Start-up |
Note: The contracting method determines whether the design, equipment procurement, and construction
phases occur in sequence or concurrently. The contracting method can also affect who is involved at each
phase (architect, engineer, construction contractor, etc.~. For example, if the design-bid-build contact
method is used, the phases generally occur in sequence, with an architect-engineer entity involved in the
design phase and a construction entity involved in the construction phase. If a design-build contract method
is used, the same contractor is responsible for the design and construction phases; thus, some phases or
activities occur concurrently.
Requirements Assessment
The federal budgeting process requires agencies to conform to a procedure of
requirements setting and prioritization review (known variously as requirements
assessment, project requirements, project assessment, and needs assessment) before
agency budget requests are submitted to Congress. This phase begins when someone
(e.g., facilities program manager, senior executive, elected official) identifies the need for
a program or facility. The agency initiates a process to gather information and validate
the need for the facility relative to a program and to the agency's mission.
The requirements phase generally determines the scope of the project required to
accomplish the agency's mission. The requirements may be a function of the number of
personnel and their grade and function. The Office of Management and Budget's Capital
Programming Guide directs agency management at this point to answer the "three pesky
questions" applicable to all major capital investments (OMB, 1997~:
Does the investment in a major capital asset support core/priority mission
functions that need to be performed by the Federal Government?
Does the investment need to be undertaken by the requesting agency because no
alternative private sector or governmental source can better support the function?
Does the investment support work processes that have been simplified or
otherwise redesigned to reduce costs, improve effectiveness, and make maximum
use of commercial, off-the-shelf technology?
The answer to any one of these questions can lead management to determine that
the requirement can be met through management strategies and that a facility is not
needed. For example, if the requirement is for additional power, it might be procured
from a power provider and may preclude the need to build a new power plant. By
applying the pollution prevention principles of"reduce, reuse, recycle" in this phase and
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Sustainable Federal Facilities
reducing facility requirements, natural resources, energy and water that otherwise would
have been used in building and operating a facility can be saved.
When a facility requirement is validated, the process to fulfill the requirement
begins with the conceptual planning phase.
Conceptual Planning
In conceptual planning (also called project preplanning, master planning, advance
planning, concept development), alternatives are considered in their broadest sense.
Decisions are made on how the requirement is to be met through the addition, alteration,
or renovation of existing facilities or through new construction. An agency may review
its entire facilities inventory and assess whether existing buildings and infrastructure can
adequately support the agency's mission and program requirements or whether facilities
need to be acquired, upgraded, or replaced. Various feasibility studies are conducted to
define the scope or statement of work based on the agency's expectations for facility
performance, quality, cost and schedule. Several alternative design solutions may be
considered before the preferred approach is chosen. The preferred approach will be used
to develop a project scope of work that will be the basis for future project decisions and
for developing contract documents to procure design and construction services.
Studies by academics, the National Research Council, the Construction Industry
Institute, The Business Roundtable, the Project Management Institute, and others point to
the importance of the conceptual planning phase to the entire facility acquisition process.
This phase of decision-making is critical, because it is at this point that the size, function,
general character, location, and budget for a facility are established. Errors made in this
phase will usually manifest in the completed facility in such forms as inappropriate space
allocations or inadequate equipment capacity (NRC, 1989,1999).
Programming and Budgeting
During this phase decisions are made on resources and priorities regarding which
facilities to acquire and when to do so. Senior agency executives determine which
projects are the most critical to agency mission needs and therefore warrant facility
acquisition. When a project is included on the agency priority list, the agency then
prepares a request for initial congressional approval to acquire the facility and for the
appropriation of funds for design and construction. The documentation required for this
phase varies but usually consists of materials to justify the facility in relation to mission
requirements and the location and physical and functional requirements upon which
preliminary cost estimates are based.
Design
The end of the conceptual planning phase and the beginning of the design phase
varies among agencies and their programming and budgeting procedures. Generally,
detailed design of a project begins once an agency is confident that fiends will be
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Facility Life Cycles and the Acquisition Process
21
appropriated to complete the project. Based on the statement of work and preferred
design approach, the design matures into final construction documents comprising the
plans and specifications from which equipment procurement and construction bids can be
solicited. (Complex facility projects may include an equipment procurement phase in
order to expedite the purchase, manufacture, and delivery of long-lead-time equipment,
such as unique process machinery, large electrical and mechanical equipment, and
sophisticated architectural components. Equipment procurement may proceed in parallel
with construction activities.)
Unless agencies have in-house design staff available, these activities are typically
contracted out to organizations that have the appropriate expertise; either to other federal
provider agencies (such as the General Services Administration, Naval Facilities
Engineering Command, or Army Corps of Engineers) or private-sector architect-engineer
firms. A 1990 NRC report found that the early stages of the design process are most
critical for assuring successful design to budget because the design is still flexible and
factors that determine cost are not fixed (NRC, 19901. In addition, the cost of operating,
maintaining, repairing, and disposing of the facility will be affected by the following
decisions during the requirements assessments, conceptual planning, programming, and
design phases:
Choice of materials and technologies
Quality of design
· Quality of construction
Building layout
Types of systems
Construction
The majority of tasks associated with large-scare federal construction are
contracted out to the private sector. Federal agencies typically undertake major
construction with federal personnel only when these functions are central to the agency's
mission or existence. The military services, for example, may retain control of facility
construction that impacts mission readiness. The construction phase is considered
complete when the owner agency accepts occupancy of the facility.
Start-up
The start-up phase begins when the user takes occupancy of the facility. Building
components are tested individually and then in systems with other components to
measure and compare their performance against the original design criteria. Facility
operation and maintenance plans are implemented, tested, and refined as appropriate.
Minor repairs and alterations can be made and users have the opportunity to learn about
the facility (NRC, 1994).
Facility acquisition, a 2-5 year process, is followed by long-tenn management,
operation, and maintenance of the facility, which may last for 30 years or longer, and
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Sustainable Federal Facilities
constitutes the majority of the facility life-cycle. Although the focus of this study is on
the acquisition process, application of the sustainable development principle for
operations and maintenance is discussed in the context of the framework outlined in
Chapter 3.
REFERENCES
NRC (National Research Council). 1 989. Improving the Design Quality of Federal
Buildings. Washington, D.C.: National Academy Press.
NRC. 1 990. Committing to the Cost of Ownership: Maintenance and Repair of Public
Buildings. Washington, D.C.: National Academy Press.
NRC. 1994. Responsibilities of Architects and Engineers and their Clients in Federal
Facilities Development. Washington, D.C.: National Academy Press.
NRC. 1 998. Stewardship of Federal Facilities: A Proactive Strategy for Managing the
Nation's Public Assets. Washington, D.C.: National Academy Press.
NRC. 1 999. Improving Project Management in the Department of Energy. Washington,
D.C.: National Academy Press.
OMB (Office of Management and Budget). 1 997. Capital Programming Guide. [Online]
Available at: http://~ww.whitehouse.gov/OMB/circulars/al 1/cpgtoc.html
Representative terms from entire chapter:
acquisition process
