A Framework for Guaranteed Maximum Price and Contingency Development for Integrated Delivery of Transportation Projects

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2011-01-01
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Gransberg, Douglas
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Shane, Jennifer
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Civil, Construction and Environmental Engineering

The Department of Civil, Construction, and Environmental Engineering seeks to apply knowledge of the laws, forces, and materials of nature to the construction, planning, design, and maintenance of public and private facilities. The Civil Engineering option focuses on transportation systems, bridges, roads, water systems and dams, pollution control, etc. The Construction Engineering option focuses on construction project engineering, design, management, etc.

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The Department of Civil Engineering was founded in 1889. In 1987 it changed its name to the Department of Civil and Construction Engineering. In 2003 it changed its name to the Department of Civil, Construction and Environmental Engineering.

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1889-present

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  • Department of Civil Engineering (1889-1987)
  • Department of Civil and Construction Engineering (1987-2003)
  • Department of Civil, Construction and Environmental Engineering (2003–present)

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This paper discusses the components of a guaranteed maximum price (GMP) and proposes a framework for the development of GMPs as contract payment provisions for construction manager-at-risk (CMR) and design-build (DB) contracts for transportation projects. The framework is the synthesis of a comprehensive literature review, a content analysis of CMR and DB solicitation documents and contracts, and case study project output from twelve projects in nine states worth $3.1 billion. The research also discusses the development of three common types of contingencies that are often utilized in projects with GMPs. The study concludes that owners should specify the structure of the GMP and its components to enhance clarity and understanding of the GMP’s composition. It recommends that this structure be included in the CMR and DB solicitation documents so that pricing proposals can be formulated in a manner that is consistent with the contract payment provisions that will be useful to practitioners that need to implement GMP-based contracts.

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This article is from Journal of Construction Engineering and Project Management 1 (2011): 1–10, doi:10.6106/JCEPM.2011.1.1.001. Posted with permission.

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Sat Jan 01 00:00:00 UTC 2011
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