Time-Related Incentive and Disincentive Provisions in Highway Construction Contracts (2010) / Chapter Skim
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Chapter 4 - Guidelines for the Effective Use of I/D Provisions
Chapter 4 - Guidelines for the Effective Use of I/D Provisions
Pages 27-40
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From page 27... ...
I/D provisions are commonly used to accomplish one or all of the following objectives: 1. Reduce contract duration to minimize overall exposure and the impacts of construction.
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From page 28... ...
The primary distinction between these two types is that the contractor determines the contract duration for an A + B contract while the STA specifies the contract time for an I/D contract. I/D Provisions I/D (calendar or working day)
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From page 29... ...
Lane rental and A + B are the two I/D provision types in which the contractor determines the contract time. The STA specifies the contract duration in all other types of I/D provisions.
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From page 30... ...
The equity and effectiveness of lump sum I/Ds was an issue raised by numerous parties during the in-depth Q&A sessions. In certain circumstances, the contractors had taken extensive efforts to accelerate the project but missed the lump sum milestone date by only a few days.
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From page 31... ...
Other excusable delays such as plan errors, third party conflicts, and unforeseen conditions are treated in a variety of ways. There are I/D provisions that treat time extensions differently with respect to the incentive and disincentive.
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From page 32... ...
Lane Rental Determination of Contract Time Owner Contractor Unit of Time Calendar Day Modified Calendar Day Work Day Disincentive Accrual & Capping a/na/ndeppaC yliaD a/na/ndeppacnU yliaD a/na/nmuS pmuL Incentive Accrual & Capping a/na/ndeppaC yliaD a/na/ndeppacnU yliaD a/na/nmuS pmuL Substantial Completion All pay items n/a Partial completion n/a hourly or daily Time Adjustments No-excuse n/a Excusable delays n/a Modified no-excuse n/a Time Adjustments Applied To a/na/nylnO evitnecnisiD a/na/nevitnecnisiD dna evitnecnI Use of this variable is acceptable Use this variable with caution Do not use this variable Table 8. Matrix of I/D types and suggested variables.
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From page 33... ...
When alternative work schedules are used, the approximate calendar days to complete this hypothetical 300 working day project varies from 386 to 217 calendar days. The conversion from working days to calendar days includes an adjustment for anticipated weather impacts.
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From page 34... ...
Activities directly related to the use of I/D provisions include the following: • Preliminary cost estimates • Preliminary time estimates • Assessment of project impacts on the public Project Design Activities and decisions regarding I/D provisions should progress through the design phase of project development. As project designs are developed and refined, I/D provision types and variables should be identified that are compatible with the project details.
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From page 35... ...
* Specified Work Schedule: Applicable I/D Provision Type: A+B: I/D Working Day: I/D Calendar Day: 10% 20% 30% 40% 5 days/week with increased resources 6 days/week with increased resources 7 days/week with increased resources 7 days/week with multiple shifts I/D Complete-by-Date: Ap pr ox im at e Ti m e Sa vin gs Lane Rental Figure 18.
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From page 36... ...
This can save significant cost for the STA.) Estimated project duration for construction activities (calendar days)
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From page 37... ...
accelerated construction during full closure that would dictate the use of an I/D provision Maintenance of traffic requirements Refinement of the time estimate Initial RUC estimate Methods: Geotechnical site investigation Utility location survey and relocation of utilities before the project start where possible Internal review by experienced personnel assessing the status of project unknowns and their potential for contributing to compensable delays Critical path method scheduling using project phases and major work items as the activities Output related to the use of I/D provisions: Summary document listing potential barriers to the successful use of an I/D provision that should be fully evaluated during the 60% design stage RUC estimate Maintenance of traffic criteria that will dictate project design details and construction activities (e.g., maintain 2 through lanes at all times, one lane may be closed only between 7:30 pm and 5:30 am, Ramp A may be closed for a maximum of 14 days between March 1 and April 30)
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From page 38... ...
based on the 60% design details Critical path method scheduling using project phases and major work items as the activities; durations based on average production rates and design quantities Recommended I/D provision types and variables (Figure 18 and Tables 8 and 9) Output related to the use of I/D provisions: Recommendation of whether or not an I/D provision is appropriate for the project o Indicate what type of I/D provision is most suitable and which I/D variables should be used o List critical milestone events which will be subject to I/Ds (e.g., re-opening of a ramp, completion of a detour, substantial completion of Phase I)
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From page 39... ...
Output related to the use of I/D provisions: Revise and refine the recommendation of whether or not an I/D provision is appropriate for the project o Indicate what type of I/D provision is most suitable and which I/D variables should be used o List critical milestone events which will be subject to I/Ds (e.g., re-opening of a ramp, completion of a detour, substantial completion of Phase I) Indicate that all potential barriers to the successful implementation of an I/D provision have been considered and are either fully resolved or present a level of risk that can be tolerated
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From page 40... ...
Using working days or modified calendar days introduces ambiguity that may lead to an inequitable assessment of incentive or disincentive.
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