boston harbor project

8/3/2019 Boston Harbor Project

1/22

January 2001

Cop yright 2001 by the Construc tion M ana ge ment Assoc iation o f Ame rica

A CASE STUDY OF CONSTRUCTION MANAGEMENT

ON THE BOSTON HARBOR PROJECT

REFLECTIONS ATPROJECTCOMPLETIONBYWALTERG. ARMSTRONG AND

RALPH M. WALLACE

PROJECT BACKGROUND

The Boston Harbor Projec t is the largest c ourt-ordered c om plianc e a c tion in the history ofthe Clean Water Ac t. The projec t eme rged from a unique set of ec onom ic and po litic alc irc umstanc es and the ap proac h ad op ted to mana ge the Boston Harbor Project w asgreatly influenc ed by the historic al c ontext in which the p roject wa s c rea ted .

Decad es of Neg lect

Boston Harbo r has ac hieved notoriety a s a d ump ing ground , from the fa mo us Tea Party in1773 throug h the heated deb ates of the1988 presidential elec tion c amp aign. Wastewaterge nerated b y the Boston region wa s d isc harge d into the harbor fro m tw o und ersized andoutm od ed prima ry trea tme nt p lants. Lac king proc essing fac ilities for upland d isposa l,these p lants a lso d isc harge d 70 tons of sludge into the ha rbo r ea c h day during outg oingtides. The c om bined d isc harge o f ma rginally trea ted prima ry effluent a nd sludg e into theshallow wa ters of Boston Harbor imp osed a signific ant burden o n the m arine ec ology andresulted in serious deterioration of the aesthetic, commercial and recreational qualities ofthis vita l resourc e.

Passage of the Fed eral Clean Water Act in 1972 req uired tha t a ll munic ipa l sewagetrea tment systems inc orporate sec ond ary trea tment by 1977. Sec ond ary trea tmentprovides remova l of signific antly higher levels of both solids and b ioc hemic a l oxyge ndemand from wa stew ater. These new standards p lac ed the Me trop olitan Distric tComm ission, the age nc y responsib le for wastew ater trea tme nt for muc h o f the Bostonme tropolita n reg ion, in violation of the law . The law , howe ver, a llow ed jurisd ictions tha td isc harge d into c oa sta l wa ters to a pp ly for wa ivers from the sec ond ary trea tme ntreq uirem ent . The M etrop olitan Distric t Co mm ission app lied to the U.S. Environme nta l

Protec tion Ag enc y (EPA) for suc h a wa iver in la te 1979.

The EPA w as slow to ac t o n the wa iver req uest a nd the c ontinuing dete rioration o f BostonHarbor prompted affec ted c ommunities and environme ntal groups to ta ke a c tion. In1982, the City of Quinc y, loc a tion of the then 30-year-o ld Nut Island Trea tment Plant, filed asuit in Ma ssac huset ts Superior Co urt c ha rg ing violations of laws prohib iting d isc harges intoc oa sta l and t ida l wa ters. The c ourt imp osed a m oratorium on new sewer hookups in the


2/22

January 2001

A Ca se Study o f Construction Ma nag eme nt

On the Boston Harbor Projec tReflec tions at Projec t Com p letion

Cop yright 2001 by the Construc tion M ana ge ment Assoc iation o f Ame rica 2

Boston reg ion, ra ising the issue to ne w heights of p ub lic a wa rene ss. Althoug h themo ra torium was quic kly overturned on p roc ed ura l grounds, the threa t of ha lting newc onstruc tion during a n ec onomic b oom in the reg ion p rovided increased imp etus forresolving the prob lem.

The leg islative response was to c rea te a n indep end ent sta te a uthority. In la te 1984, theMa ssac husetts Water Resourc es Autho rity (MWRA) a ssumed responsibility from theMetrop olitan District Com mission (MDC) for providing w holesa le wa ter and sew er servic esto 60 ea stern Ma ssac huset ts c om munities. In a dd ition to its op erat ing responsibilities, thenew authority was ma de responsible for reha b ilita ting the wa ter and sew er system s andbringing them into c ompliance w ith ap plic ab le e nvironme ntal law s. In effec t, the fled glingauthority wa s c harged with the long-awaited c lea nup o f Boston Harbo r.

Within a m onth o f its c rea tion, the autho rity bec ame a d efend ant in a suit b roug ht by theConservat ion Law Foundation and the U.S. Environm enta l Protec tion Ag enc y ove r the

MDCs fa ilure to c om ply with the Clean Water Ac t. On Sep temb er 5, 1985, U.S. Distric tCourt Judg e A. David Ma zzone ruled tha t d isc harge s into Boston Harbor we re in violationof the C lea n Water Ac t. Follow ing intense nego tia tions, a c ourt-ordered sc hed ule fo rc onstruct ing mod ern sec ondary trea tment fa c ilities to serve the Boston reg ion wa s issuedon May 8, 1986. The c ourt order req uired the a uthority to c ommenc e c onstruc tion o f newprimary trea tment fac ilities in 1990 and c om plete a ll fac ilities by 1999.

Economic Clima te

The long deb ate a nd assoc ia ted delay surround ing the c lea nup of Boston Harbo r resulted

in losing the op portunity to seek fed eral fund ing fo r the b ulk of the harbor cleanup sprojec ted c ost. During the 1970s the fed eral go vernment p rovided up to 75 percent ofthe fund s nec essary to c onstruc t wa stew ater treatment fa c ilities. Throughout the 1980s,however, the tota l am ount of fede ral grants de c lined stea dily. By the end of the d ec ad e,fed eral grants for c onstruc ting sew age trea tme nt fac ilities c ea sed . The fed eral role wa sultimately re-defined to he lp sta tes c ap ita lize low interest loan prog rams from which loc a lc om munities c ould borrow . Boston, like San Dieg o, Los Ang eles and o ther c oa sta l c itieswhich had sought sec ond ary trea tment waivers, was now fac ing an extraordinary financ ialburde n to a c hieve c omp lianc e w ith the Clea n Water Ac t.

Financ ing the Boston Harbor Projec t was further complic a ted by a sharp dow nturn in the

loc a l ec onom y. During the 1980s, Boston had o ne o f the strongest ec onom ies in the U.S.,d riven b y the c onc entration of high tec hnology industries within the region. Unfortunate ly,the Massachusetts miracle ended just as the Boston Harbor Project began.Unemployment rates in late 1989 rose in the C ommo nwealth while the y dec lined for thena tion as a w hole. The econom ic dow nturn wa s d isastrous for sta te revenue receipts.Ma ssac husetts end ed fisc a l year 1990 with a $1 b illion defic it.


3/22

January 2001




Lac king fed eral funding, the c ost of the Boston Harbor Projec t would b e largely bo rne b ythe MWRA s ra tepayers, the househo lds and businesses who a re the ultima te c onsumers ofthe servic e s it p rovides, and as the p rojec t shifted into c onstruct ion the c ha rges for sew erservic e in the Boston reg ion grew d rama tica lly. In 1984, p rior to the c rea tion of the MWRA,the typ ica l household pa id less tha n $100 per yea r for sew er services. From 1985 to 1990,the MWRA increased tota l sewage charge s by nea rly 400 perc ent a nd planne rs forec asttha t ave rage househo ld c harges wo uld e xc eed $1,200 by 2000 whe n the p rojec t wa s tobe c om pleted . In response, the public outc ry ag a inst the c osts of the Boston HarborProjec t mo unted , c ulminating in the Spring of 1993, when 300 ra tepayers re -enac ted amo dern version of the Boston Tea Pa rty b y d onning c olonial c lothe s and tossing their wa terand sew er bills into the ha rbor.

Shortly thereafte r, the sta te leg isla ture c rea ted a deb t servic e assistanc e prog ram to helpmitiga te the a nnua l increa ses in sew er bills and the Ma ssac huset ts legislative d eleg ationwa s suc c essful in sec uring Fed eral a id, which ultima tely funded approxima tely 20% of the

c ost of the Boston Harbor Projec t. These resulted in significantly low er annua l ra teincrea ses, howeve r, the intense p ub lic sc rutiny and unrelent ing p ressure to c ontrol andhopefully red uce the projec ted c ost of the Boston Harbo r Project rema ined and be c am ede ep ly ingrained in the projec ts ma nag eme nt app roa c h.

Projec t Description

The Boston Harbo r Projec t (BHP) is one of the largest w astew ater projec ts eve r unde rtakenin the United Sta tes. The p rojec t involves the p lanning , design, construct ion and sta rt-up ofa va st new w astewa ter trea tme nt system costing $3.6 b illion. Exc ep t for fina l paving and

landsc ap ing, the p rojec t is c om plete a s of Dec ember 2000 and provides sec ond arytrea tme nt of w astewater gene ra ted by more tha n 2 million residents and over 5,500businesses in the grea ter Boston metrop olitan a rea .

The p rojec t c onsists of five ma jor c om ponents:

v Primary trea tment fac ilities, consisting of four ba tte ries of p rimary c larifiers, an on-island hea dwo rks, pump sta tions and d isinfec tion fac ilities. In dry wea ther, thep rimary plant hand les roug hly 350 million g a llons per da y, but c an hand le p ea kwe t w ea ther flow s of 1.27 billion ga llons per day.

v Sec ond ary treatm ent fac ilities, c onsisting o f three ba tteries of sec ond ary reac tors

and c larifiers, supp orted by a c ryoge nic oxyge n plant, ca pa ble of trea ting up to780 million ga llons per day.

v A remote hea dworks fac ility p roviding p retreatm ent to 400 million ga llons pe rda y of wa stewa ter from the southern pa rt of the Boston region c onnec ted to a4.8 mile long roc k Inte r-Island Tunnel tha t transports these flows beneath BostonHarbor to the Deer Island Trea tment Plant.


4/22

January 2001




v A 9.5 mile long roc k Effluent Outfa ll Tunne l which d isc harges treated effluent intothe dee p waters of Massac huset ts Bay throug h a series of 55 d iffusers spac eda long the last 1.5 miles of the tunnel.

v On-island residua ls p roc essing fac ilities (inc luding the p rojec t s land ma rk egg-shap ed digesters) and an o ff-island sludge pelletizing p lant tha t c onve rt sludgegene rated by the ne w p lant into 33,000 dry tons of fe rtilizer annua lly.

In add ition, the d eve lop ment o f an extensive ne two rk of utilities and support ac tivities wa sreq uired to supp ort c onstruc tion a nd ongoing op eration of the new trea tment p lant,including:

v On-island a nd o ff-island utilities to support bo th c onstruc tion and ongoingop erations, fea turing a therma l/ po wer plant c ap ab le o f generating ove r 70-meg aw atts of e lec tric ity.

v Extensive d emolition/ site p rep ara tion a nd the imp lementa tion o f a p ublic ac c essp lan (the perime ter of Deer Island and Nut Island , the two princ ipa l co nstruc tionsites, are part o f the rec ent ly c rea ted Boston Harbor Islands Nat iona l Sea shore).

v On-island and off-site transportation fa c ilities and the assoc ia ted bus and wa tertransportation servic es to m ove wo rkers, equipment a nd ma teria l to / from DeerIsland.

The d esign a nd c onstruc tion for the p rojec t involved the exec ution o f 32 design c ontrac tsand 133 c onstruction and support services c ontrac ts. Ultima te ly, the a c tivities of multip lec ontrac tors, subc ontrac tors, and ma terial and eq uipm ent vend ors need ed to besched uled , c oo rd ina ted and trac ked to e nsure tha t de lays were avoided, the agg ressive

c ourt sc hed ule wa s me t, and c osts we re rigorously c ontrolled .

In any situa tion, ma naging a large , multi-yea r cap ita l prog ram poses a formida blemanagement c hallenge . The complexity of the ma nag ement task fac ed by the MWRAwa s further com pound ed by seve ra l fac tors assoc ia ted with the Boston Harbor Projec t,particularly with the dete rmination tha t Deer Island (a sma ll peninsula a t the entranc e o fBoston Harbor) wa s the only fea sible loc a tion for the trea tment fa c ility. The major fac torsad d ing to the projec ts c omplexity were:

v Sc hedule c onstraints - The aggressive Court-orde red sc hed ule req uired p lantc onstruc tion to c ommence by Dec ember 1990. The new p rima ry plant was to

be c ompleted by 1995 and all process fac ilities were to be c ompleted byDecember 1999.

v Site c onstraints The small Dee r Island site strong ly influenc ed the design o f thenew trea tme nt fa c ilities (req uiring use of spac e saving designs more c ommonlyfound outside the U.S.), affec ted the phasing of c onstruc tion, and req uired useof o ff-site loc a tions for c onstruc tion staging. In ad d ition, roa dwa y ac c ess wa slimited to narrow two-lane stree ts winding throug h d ense residentialneighb orhoods tha t c ould no t suppo rt the m assive vo lume of c onstruc tion tra ffic .


5/22

January 2001




v Mitiga tion c om mitments - All construc tion wa s to oc c ur c lose to estab lishedresidential neighb orhood s and ac c ess to the c onstruc tion sites wa s throug hthese c ommunities. To m itiga te c onstruc tion imp ac ts, the MWRA move dessentially a ll equipm ent, and ma terials to/ from Deer Island by barge and a lmo st

a ll workers were transported to the site b y bus or passeng er ferry servic e.String ent limita tions on a ir em issions, noise a nd visua l impac ts were a lsoestab lished for both c onstruc tion and op eration of the new p lant.

v Ma intain existing operat ions - The d esign of the ne w fa c ilities and phasing ofc onstruc tion ha d to p ermit the ong oing op eration of tw o e xisting wa stewa tertreatment facilities.

v Co mp et ition w ith other p rojec ts - The Boston Harbor Projec t had to b ec oo rd ina ted with other ma jor co nstruc tion p rojec ts in the Boston a rea ,particu larly the $14 b illion Centra l Artery/ Third Harbor Tunnel projec t, whichwo uld exert c onc urrent dem ands for ava ilab le resource s, inc lud ing

ma nage ment, labo r, equipment, ma teria ls, wate r transportation, and d isposa lsites for excess materials.

v The succ essful ma nage ment of the projec t depend ed on the a bility toovercome the ob stac les desc ribe d ab ove, c ontrol project c osts, comp lete thec onstruc tion w ithin the c ourt mand ate d timeta ble, deliver quality op erab lefac ilities, and ma inta in a positive relationship with a ffec ted c om munities.

SELECTING AND IMPLEMENTINGA PROJECT MANAGEMENT STRUCTURE

The a ggressive c ourt-orde red sc hed ule, intense p ub lic p ressure fo r c ost c ont rol anddaunting log istica l cha lleng es assoc ia ted with the Boston Harbor Projec t d ic ta ted tha t theMWRA quickly imp lement an effec tive ma nag ement struc ture to ta ke the projec t from thefac ilities p lanning stage into d esign, c onstruc tion and sta rt-up. As a new age ncy, theMWRA ha d relied hea vily on c onsultants to p rep are the sec ond ary trea tment fac ilitiesp lan. Within the autho rity, responsibility for managing the p rojec t initia lly resided w ith theMWRA s eng ineering d ivision, whic h was responsible fo r a ll MWRA e ng ineering andc onstruc tion projec ts enc ompassing b oth reha b ilita tion projec ts and the new c ap ita lp rojec ts ge nerated by the c ourt order. The MWRA was ab le to assign only two full timesta ff to manage the fac ilities p lan for wha t wa s projec ted to b e a $4.0 b illion p rog ram.

Althoug h this struc ture was suc c essful for the initial fac ilities p lanning phase of the prog ram,the MWRA fa c ed numerous questions as the projec t was rea dy to progress into the mo reintensive phases of d esign and c onstruct ion:

v How c ould MWRA m aintain a de qua te c ontrol over the design and c onstruc tionof the new c ourt-ordered fac ilities? What was the p referred orga niza tionalstruc ture fo r genera ting effec tive age nc y ove rsight?


6/22

January 2001




v How c ould the MWRA e ffec tively manage the $4.0 b illion Boston Harbor Projec twhile c onc urrently imp lementing a $100 million per yea r system-wide c ap ita lreha b ilita tion prog ram?

v What would b e the role of priva te firms and ho w should the priva te sec torresources be orga nized ? How should the relationship be tween in-house (pub lic)and priva te sec tor resources be struc tured ?

In deve lop ing answers to these q uestions, the authority reviewed the m anage mentapproac hes used by two relevant large -sc a le public wo rks p rojec ts: the North River Wate rPollution Co ntrol Plant in New York City and the Ce ntral Arte ry/ Third Harbor Tunne l inBoston.

New York Citys North River Water Pollution Co ntrol Plant wa s selec ted bec ause it wa s oneof the mo st expensive wa stew a ter trea tment plant und er construc tion a t the time and

presented c om plex c onstruct ion ma nagem ent issues. The fac ility, which c ost $1.1 b illion,wa s c onstruc ted on a sma ll site w ith its limited acc ess imp ed ed by a m ajor highw ayreha b ilita tion projec t. Like the p lanned MWRA fac ilities, the projec t had to c onform tomilestone d ates stipulated in a fed eral c ourt order. The ma nage ment ap proa ch for theNorth River Plant wa s d istinguished by the follow ing c ha rac teristics:

v Use o f consultants for design and c onstruc tion ma nagem ent o f the p lant - Thisdec ision reflec ted rec og nition o f the projec t s c omplexities and the internalresource c onstra ints of a n age nc y (the New York City Dep artment ofEnvironme nta l Protec tion or NYC/ DEP) alrea dy enc umbered by substantialong oing c ap ita l and op erating respo nsib ilities. The relianc e on c onsultants wa spartic ula rly signific ant in this case be cause the age nc y had previously d esigne da 300 million ga llon per da y wa stew ater trea tme nt p lant entirely with in-housestaff.

v Rete ntion of agency control in key programm at ic a rea s Although thec onsultant te am ha d p rimary responsib ility for design eng inee ring a ndc onstruction ma nag eme nt, the NYC/ DEP elec ted to ma intain mana gementc ontrol, allow its ow n sta ff to ha ve input into the d esign proc ess, and reta inedthe authority to advertise b ids, selec t c ontrac tors, issue c hange orders and ma keprog ress payme nts. The c onsultant ha d input on the se d ec isions, but onlyNYC/ DEP c ould p rovide fina l written approva l.

v Integ ra tion of c onstruc tionrelated knowledge into the design a nd

imp lementa tion proc ess NYC/ DEP rec og nized that the projec t s p lanning andde sign w ould have a direc t imp ac t on the a bility to ma nag e c onstructioneffec tively. Therefore, co nstruction-oriented p ersonnel we re involved in designreviews, value e ngineering, sc hed uling and c ost estimating ea rly in the p rojec t.

The Central Artery/Third Harbor Tunne l Projec t w as selec ted bec ause of its simila r sc a le,geographic p roximity, similar req uirem ents in labor and ma teria ls, and similar log istica lissues, such as ma teria l disposa l. With the go a l of doub ling the c apac ity of the Centra l


7/22

January 2001




Artery and mo ving traffic from we st a nd south of Boston to Log an Airport without p assingthroug h dow ntow n Boston a nd East Boston, the p rojec t wa s estimate d a t tha t time to c ostapproximate ly $4.4 billion.

The approa c h ad op ted by the o riginal sponsoring a ge nc y (Massac husetts Depa rtme nt ofPub lic Works or MDPW) sha red many simila rities and has som e d ifferenc es in ap proa c h tothe North River Plant. The similarities a re:

v The use of outside c onsultants ra ther than in-house sta ff for d esign a ndc onstruct ion services;

v The retention of a ge nc y control of a rea s suc h as c ontrac tor selec tion, c hangeorde rs and prog ress payme nts; and

v The integ ra tion of c onstruc tion-related knowledge into the design andimp lementa tion proc ess.

The main wa ys in which the two approa c hes d iffered are:

v The c rea tion o f a spe c ia l p rog ram m anag ement o ffic e w ithin the spo nsoringage nc y The MDPW crea ted an in-house program ma nageme nt group toprovide ove rsight a nd m onitoring o f the consultant tea m. The group , whichinitially co nsisted of 40 people, had m anage ment, tec hnic a l and supp ortpersonnel. The responsibilities and o rganiza tion of the in-house team mirroredthose of the c onsultant tea m for effec tive interac tion.

v Early dec ision to use a single firm to m anage both d esign and c onstruc tion

services Both MDPW and the NYC/ DEP used a sing le tea m to ma nage thedesign and c onstruc tion o f their respe c tive projec ts. MDPW made this judgm enta t the sta rt of design a nd soug ht an integra ted tea m w ith multiple c apab ilities.NYC/ DEP, perhaps bec ause of the more spec ialized design req uirem entsassoc iated with sec ond ary trea tment fa c ilities, initia lly soug ht the best designengineering team and late r de c ide d to use the sam e tea m for co nstructionmanagement services.

v Use of multip le design firms In the Ce ntral Arte ry/ Third Harbor Tunnel Projec t, theprime c onsultant tea m ha s overall responsibility for design but doe s not performall design func tions. The approa c h is for the p rime consultant to p rep are thec onc ep tua l design a nd the MDPW co ntrac ts d irec tly with sec tion d esigners

who c omplete the d eta iled de sign o f various projec t compo nents.

Implem entation of a Ma nagement App roach for the Bosto n Harbo r Projec t

In Sep tem ber 1987, the MWRA Boa rd of Direc tors approve d a rec om mendation to rec ruit ama nag eme nt tea m c onsisting of three c omp onents to ma nag e the Boston Harbo r Project:


8/22

January 2001




v a new ly c rea ted in-house team ded ic ate d solely to the p rojec t, know n a s theProg ram Ma nage ment Division;

v a c onsultant tea m to serve as Prog ram/ Construc tion Manage r; and

v a sec ond c onsultant te am to serve a s Lea d Design Engineer.

This ma nag ement m od el ad apte d ma ny idea s from both the North River Trea tment Plantand the Central Artery/ Third Harbor Tunnel, but d iffered with the m in seve ra l respec ts, mostnotab ly, in the d ec ision to c learly sep ara te responsibility for design and c onstruct ionmanagement.

The Program Manag em ent Division

The m ission of the M WRA s Prog ram M anagem ent Division (PMD) is to provide the authoritywith c ontrol and oversight o f the Boston Harbor Projec t. PMD has bee n responsible for theexecutive d irec tion, manag eme nt and c oordination of the p rog ram , inc luding ove rsight o fc onsultants. Throug h PM D, the MWRA reta ined the sole autho rity to b id and a wa rdc ontrac ts, selec t c onsultants, authorize c hange orders and prog ress payments, and resolvec la ims. The MWRA a lso reta ined the a b ility to p erform indep end ent review of a ll consultantwo rk prod uc ts.

As with the Central Artery/Third Harbor Tunne l Projec t, the MWRA saw the follow ingad vanta ges in c rea ting a de dica ted in-house team:

v prevent the projec t from c onsuming the resources of e xisting eng ineering andc onstruction sta ff, which ha d on-going responsib ility for a sizea b le ($100 millionpe r year) c ap ital prog ram ;

v foc us the full a ttention o f a spec ific group of individuals on the harbor projec tra ther than involving sta ff w ith multip le responsibilities; and

v provide the opportunity for the MWRA to rec ruit personne l with the nee dedprog ram ma nage me nt skills from within a nd outside MWRA.

The tea m wa s initia lly c om posed of individua ls with b ac kground s in d esign eng inee ring,c onstruction ma nag eme nt, financ e and bud ge ting, c ontrac t a dm inistration, prog rammana ge ment, informa tion system s, environmenta l planning a nd c om munity relations.Ap proxima tely 85 perc ent o f the sta ff wa s rec ruited from outside the MWRA a nd 60percent of the initial PMD sta ff had som e private sec tor wo rk experienc e. PMD s sta ffingpea ked a t 51 during the d esign a nd ea rly construc tion pha se a nd has subseq uentlydec rea sed to 22 as the p rojec t rea c hed substantia l c om pletion. Over time , the mix of skills


9/22

January 2001




has a lso c hange d in response to shifting p rojec t need s, with a grea ter emphasis onc onstruction ma nag eme nt, contrac t a dm inistration a nd c laims/ litiga tion m ana gement.Two-thirds of the c urrent sta ff we re d rawn from outside the MWRA a nd 60 percent o f therem aining sta ff has private sec tor wo rk experienc e, primarily with consultant eng ineeringfirms.

Prog ram/ Construc tion Manager

A Prog ram / Construc tion Ma nag er (P/ CM) was incorpo rated into the ma nag eme ntstruc ture to b ring a n orga nized , system at ic approac h to ma nag ing the p rog ram from pre-c onstruc tion p lanning a nd de sign through start-up and ac c ep tanc e of the new fac ilities.Day-to-da y prog ram ma nage me nt responsib ilities reside w ith the P/ CM ra ther than theMWRA s in-house sta ff.

As previously discussed, the aggressive court mandated timetable, the requirement forc a reful c oo rd ina tion of num erous c ontrac tors, subc onsultants and eq uipment vend ors onc onstrained c onstruct ion sites, and the p rojec t s log istica l c ha lleng es nec essitated the useof an expe rienc ed , private-sec tor c onstruc tion management firm. The use of suc h a firmwas a lso viewed as providing a p rog ram-wide perspec tive that would increase thelikelihood o f mee ting the projec t s sc hed ule a nd c ost ob jec tives, and integ ratec onstruc tion-related knowledge into the design a nd imp lementa tion p roc ess.

As the principa l ma nagem ent c onsultant , the P/ CM has responsibility for residenteng ineering and inspe c tion, p rojec t sched uling, c ost estima ting, c ontrac t a dm inistra tion,doc ument c ontrol and informa tion systems, community relations, environmenta l pe rmitting,

wa ter transportation, b ulk ma teria ls hand ling , value e ngineering , pre-purc hase ofeq uipm ent, fac ility testing, sta rt-up a nd sta ff tra ining . The P/ CM te am for the Boston HarborProjec t is led by Earth Tec h, Inc . (forme rly Ka iser Eng ineers), with Stone & Web ster serving asits p rinc ipa l sub c onsultant. This team b eg an work in Ap ril 1988.

Lea d Design Eng inee r

The third memb er of the ma nag ement tea m, the Lea d Design Engineer (LDE) wa sresponsible for d irec ting the design of the ma jor p rojec t com pone nts. The LDE deve lopeddesign standards (inc lud ing a p rojec t-wide design ma nual), imp lemented a standa rd ized

CADD system, p rep ared c onc ep tua l designs (10 to 15 percent design level) for a ll fac ilities,p rep a red a final design of those fac ilities req uiring early co mp letion and c oo rd ina ted thewo rk of othe r design firms prep aring deta iled designs of va rious projec t c om ponents. Asdesign and c onstruct ion prog ressed , a key role o f the LDE wa s to review design andc ontrac tor submitta ls to insure the integrity of the p lant-wide d esign. During the c ourse ofthe p rojec t, the LDEs role a lso expa nd ed into c onstruct ion testing a nd sta rt-up.


10/22

January 2001




The LDE for the Boston Harbor Projec t was Me tc a lf and Eddy, Inc ., which b eg an wo rk inAug ust 1988 and c ompleted its LDE services in July 1998.

Key Fea tures of the Boston Harbor Construc tion Managem ent (CM) Approach

The MWRA s c onstruc tion managem ent m od el is d istinguished by the fo llow ing fea tures:

v The CM was selec ted prior to the selec tion of the Lea d Design Eng ineer.Imm ed ia tely afte r assembling a c ore in-house te am (PMD), the MWRA b eg anthe selec tion proc ess for a CM. The CM was selec ted p rior to the hiring of thedesign team b ec ause it wa s to have d ay-to-da y manage ment respo nsibility forthe p rojec t. The CM wo uld b e responsib le for co nstruc tion p lanning a ndseq uenc ing which w ould guide the d esign sc hedule a nd ea rly input from theCM w as essent ial to ensure tha t Construc tibility and op erab ility c onc erns we reinc luded in the d esign.

v The MWRA Procured the LDE sep arate ly from the CM . The CM a nd LDE wereproc ured sep arate ly by the MWRA to ensure tha t the m ost qualified design andCM firms we re selec ted in indep end ent p roc urem ents. A joint selec tion w ouldhave left the M WRA subjec t to the unc ertainty of the m arketp lac e a s to te am ingof design a nd c onstruc tion manag em ent firms. The MWRA wa s c onc erned tha ta joint selec tion c ould likely result in a situat ion where a single p rop osa l d id no tc onta in bo th the most qualified CM a nd LDE.

v The LDE ha s ultima te responsibility for c oord inating the w ork of all designers. In itsdesign role, the LDE rep orted d irec tly to the MWRA s Prog ram Ma nage ment

Division.

v Used multiple design firms. The MWRA sep ara tely contrac ted with individua ldesign firms to d eve lop ed deta iled design o f various projec t com ponents andprovide engineering services during construction.

v The CM performed va lue eng inee ring and reviewe d designs for Construc tibilityand o perab ility. This involvement brought an ad ded d imension of quality co ntrolto the design a nd utilized the c onstruc tion a nd p lant op era tions knowledge o fthe CM a t key p oints in the design proc ess.

v The CM is responsible for managing the o verall p rog ram fo r sc hed ule andbudge t c ontrol. All design c onsultants and c onstruc tion contrac tors submit their

sc hed ule a nd c ost information to the CM for ana lysis and mo nitoring.

v The CM w as c rea ted to b e the Owners Rep resenta tive . Exc ep t for a c lea rlydefined role in va lue engineering a nd c onstruc tibility review, the CM ha d noresponsibility for design. The C M, therefo re, p rovided resident eng inee ring a ndinspec tion and ove rsaw sta rt-up of the new fac ilities without ha ving a vestedinterest in the p erformanc e o f the d esign, equipm ent o r c onstruc tion.


11/22

January 2001




MANAGEMENT TECHNIQUES AND THEIR EFFECTIVENESS

In a pape r p resented a t the 1992 Nationa l CM Conferenc e sponsored b y the Construc tion

Manag eme nt Assoc iation of Americ a, a numb er of tec hniques to enhanc e ma nag eme nteffec tiveness on the Boston Harbor Projec t we re reviewed . This sec tion provides an updateon the e ffec tiveness of these tec hniques inc lud ing, where feasible, a quantific a tion ofprojec t outco mes.

Design Manag em ent

Controlling c onstruc tion c osts wa s ac hieved, in p art, throug h the design standardiza tionand oversight p rovided by the Lea d Design Engineer (LDE), the app lica tion o f c omputer-assisted design a nd dra fting (CADD) tec hnology a nd the use o f indep end ent va lue

eng ineering, Construc tibility a nd op erab ility reviews led by the CM.

The c rea tion o f a stand ard d esign m anua l and the developm ent of a projec t-widec onc ep tua l design eliminate d ma ny initial questions from the d eta iled designe rs (projec tdesign eng ineers or PDEs), and thereb y red uc ed design c ost and time. PDEs were g iven alimited a mount of time to g enerate sugg estions on w ays to improve the c onc ep tualdesign. Soo n the rea fter, the b asis for the deta iled design wa s locked-in, to the extentfea sib le, so tha t de sign c ould be expe d ited .

Standard iza tion was further enhanc ed by the use o f a single CADD system used by alldesigne rs. The MWRA took an aggressive step in determining tha t a single CADD system

should be used by all designers, and furnished the requisite hardwa re a nd softw are to thefirms. This unusua l step w as mo tivated by the d esire to ac hieve the fo llow ing:

v time ly c ompletion o f a ma ssive design effort by e nab ling the use o f multip ledesign firms working simultaneo usly on sep ara te deta iled designs;

v ensuring c onsistenc y of d esign a nd qua lity c ont rol while using multip le designers;and

v c rea ting the ba sis of an informa tion system for the ongo ing m anage ment of thecompleted facilities.

Of eq ual imp ortanc e in c ontrolling c osts wa s the use of indep end ent tea ms led by the CMto review d esigns for va lue eng ineering , Construc tibility and o perab ility c onc erns. Thevalue engineering reviews were c ond uc ted on the c onc ep tual design p repared b y theLDE and on the 60% submitta ls p rep ared by the d eta iled designers. Constructa b ility andop erab ility review s we re d one o n the 30, 60 and 90% submitta ls. Op erab ility review s a lsowere c onduc ted on g roups of c onstruction c ontrac ts that c omprised linked fac ilityc om ponents. These reviews were ap tly name will-it-work rev iews.


12/22

January 2001




Early in the projec t, a g oa l wa s esta b lished to limit design c osts to betwe en 5% and 7% oftota l construc tion costs. With de sign com plete and c onstruct ion physica l p rog ress a t 99.4%c om p lete, design c osts on the BHP are 5.2% of c onstruct ion. In ad d ition to c osts rela ted toprep ara tion o f d eta iled designs, eng ineering c osts we re a lso inc urred during c onstruc tion.Although the C M p rovide s resident eng inee ring and inspe c tion, in the BHP ma nage mentstruc ture, the d eta iled designers p rovided support servic es during c onstruc tion to insure theinteg rity o f the original d esign intent, inc lud ing review of c ontrac tors submittals and shopdrawings and support during c hec kout and testing. To d a te, the cost of eng inee ringservic es during c onstruc tion are 4.0 % of c onstruc tion c osts c om pared to a p rojec t ta rgetof 4 to 6%. Ove ra ll, eng ineering service s on the BHP rep resented 9.2% of c onstruction c ostsversus a p rog ram ta rget o f 9% to 13%.

The estima ted c ost of va lue eng ineering reviews, approximate ly $2 million, was more tha noffset b y estima ted savings of a pp roxima tely $200 million d oc umented by a n inde pend entreview o f the va lue eng ineering p rog ram c ond uc ted in 1994 by KPMG Pea t Marwick and

Lew is and Zimm erman. An exam ple o f the va lue-eng inee ring p rog ram was the red esign o fthe North System Tunnels on Deer Island . Two 11.5 foot d iam eter tunne ls were req uired totranspo rt flow approxima tely 2,250 feet from a reha b ilita ted pump station to a newhea dwo rks fac ility to c omme nce the trea tment p roc ess. Originally, these tunne ls we re tobe b uilt using open c ut construc tion tec hniques. This approa c h would ha ve signific antlyaffec ted on -go ing c onstruc tion on a high ly co nstra ined site. The va lue eng inee ring reviewof this c onstruc tion co ntrac t rec om me nded build ing the soft g round tunnels using a tunnelboring ma c hine (TBM). Further ana lysis dem onstra ted the fea sibility of this technique andthe tunnels were b uilt using a TBM, resulting in estima ted savings of $10 million a nd avoidingsubsta ntial disrup tion of other ongoing c onstruct ion projec ts.

The e ffec tive ma nage ment o f design a lso benefitted the MWRA in succ essfully b idd ing thec onstruc tion wo rk and c ontrolling c ost esc a la tion onc e c onstruc tion wa s underway whic his discussed below.

Enhanc ing Comp etition Through Contrac t Pac kaging

The MWRA d elinea ted the m amm oth c onstruc tion effort into d isc rete , log ica lly seq uenc edc onstruc tion p ackag es in order to inc rea se p ric e c ompetition. The p rojec t wa s subd ividedinto 133 c onstruct ion pac kag es rang ing in va lue from less tha n $10 million to over $200million. This b rea kdow n wa s intend ed to m aximize c ompetition a mong loc a l construc tion

firms by orienting p ac kages within the limits of the bond ing c apac ity of loc a l firms. Byexped iting the d esign a nd b id of these c onstruc tion p ac kages, the MWRA was a lso a b le tolargely avoid c om pet ition w ith the Central Artery/Third Harbo r Tunnel Projec t and takead vanta ge of a do wnturn in the reg iona l ec onom y that oc curred in the ea rly 1990s whenthe MWRA b id the b ulk of BHP c onstruc tion. The c om bination of effec tive pa c kag ing a ndtimely b idd ing from late 1990 to ea rly 1992 resulted in co nstruct ion b ids tha t were, onaverage, 10.4 percent b elow the eng ineers estima tes and yielded savings of $225 million.


13/22

January 2001




Red uc ing Bid Contingenc ies and Enc ouraging Cost Savings Through ProgressiveContrac ting Prac tices

Often p ub lic ow ners of c omplex co nstruc tion p rojec ts req uire tha t c onstruc tion c ontrac tors

bea r a ll risk assoc iate d w ith the va riab ility of subsurfac e c ond itions. Under this typ e o fapproa c h, substantial c ontingenc y monies are included b y co ntrac tors in their bid p ric esfor d iffering site c ond itions.

Rec og nizing tha t c onstruction of the 9.5 mile undersea Effluent Outfa ll Tunnel and the 4.8mile Inter-Island Tunnel is by nature unp red ictab le, the MWRA sought to minimizec ontingenc y bids by enga ging in extensive ge otec hnic a l investiga tions and adop ting therisk-sharing c ontrac ting p rac tic es rec ommended by the Underground Tec hnologyResearch Co unc il (UTRC).

During the two summers preceding the bidding of the Effluent Outfall and Outfall Diffuser

c ontrac ts, the MWRA c onduc ted ge otec hnic al investiga tions along the p rospe c tive tunnelroutes a t a c ost of $20 million. The c ore bo rings and a ssoc ia ted da ta were made a va ilab leto a ll p rospec tive b idd ers as they assem bled their b ids.

Both c onstruc tion pac kages a ttrac ted c om petitive b ids c lose to the eng ineer s estima te,sugg esting tha t the ge otec hnic a l doc uments and risk sharing c ontrac ting p rac tic esincluded in the bid doc uments limited the amount of contingency emb ed de d in the b ids.Differing site c ond itions and othe r unforeseen c ontingenc ies we re, how eve r, enc ounte redin bo th tunne l p rojec ts resulting in sub sta ntia l increa ses in the c ost of the BHP tunnels. Thec om bined c ost o f the projec ts rose from $274 million as b id to $451 million.

In a dd ition to sharing the risk assoc ia ted with the two tunnels and red uc ing the

c ontingenc ies in the b ids rec eived , the MWRA a lso soug ht to enc ourage c ost savingsthroug h use o f a va lue eng ineering c lause on a ll c onstruc tion co ntrac ts. Valueeng ineering is inc luded as an inc entive c lause to p rom ote innova tive c onstruc tionmethods and tec hniques. Should the c ontrac tor conc eive of a m ore c ost-effec tiveap proac h for construc tion o f the fac ilities and that a pp roa ch is ap proved by the MWRAand its design e ngineer, the MWRA a nd the c ontrac tor will neg otiate a sharing o f theassoc ia ted c ost savings. The mo st nota b le exam ple of c ontrac tor-gene ra ted va lueeng inee ring wa s the red esign of the found ation for the eg g-shaped d ige sters. This va lueengineering effort rec eived a n awa rd from the loca l chapte r of the Assoc iated GeneralContractors.

Ensuring Labo r Harmony Through a Projec t-Wide Labo r Agreement

In fo rmulating the labor relations policy fo r the Boston Harbor Projec t, the MWRA s mo stsignific ant co nc ern wa s the avoida nc e of de lay. Any de lay in the co nstruc tion sc hed ulec ould substantia lly inc rea se the tota l c ost of the p rojec t. I nitial estimates we re tha t a one-we ek d elay in construct ion c ould result in a $2 million increa se in c osts.


14/22

January 2001




Labor disputes presented a p articularly conc ern for delay on the Boston Harbor Projec tbec ause o f the g eograp hic limitations involved . As a result of the c lose p roximity of thewo rkers employed by multip le c ontrac tors on the job site a nd the c ommo n use o f busesand passenger ferries to transport wo rkers to / from the site, any d isputes c ould sprea dquickly throug hout the p rojec t. Similarly, picketing a t the limited numb er of ac cess points,suc h as the p ersonnel ferry and b arge transportation terminals, also ha d the p otent ial tod isrup t the p rojec t.

To respond to this potentia l p rob lem, the MWRA s CM, Ka iser Eng inee rs (now Earth Tec h,Inc .), ente red into a Projec t Labor Agreement (PLA) tha t ensured labor harmony w ith moretha n 15 interna tiona l and 25 loca l unions rep resented by the Build ing and Construct ionTrades Co unc il of the Boston Me tropolitan Distric t.

The PLA w as designe d to avoid delay b y assuring, to the extent lega lly a nd prac tic a llypossib le, that lab or disputes will not oc c ur. Moreover, if they do oc c ur, the a greement

c onta ins p roc ed ures to resolve d isputes quickly and e ffic iently. The a gree me nt esta b lisheswritten rules for the e mp loyment of a ll construct ion wo rkers and sta ndard izes c erta inwo rking c ond itions for a ll wo rkers (suc h a s work hours and travel allow anc es). Theagreem ent c onta ins a no-strike guarantee from the unions which p rohibits a ll of theemployees covered under the agreement from striking, picketing or otherwise disruptingthe p rojec t throug h its dura tion.

The PLA a lso c onta ins p rovisions to resolve individua l employee grieva nc es, as well asjurisd ictiona l d isputes amo ng unions, through three -step grievanc e proc ed ures whic hc ulminate in final and b ind ing neutral arbitra tion by p rofessiona l labo r arb itra tion.

To d a te, the BHP has em ployed over 23 million hours of c onstruc tion lab or without a singleday lost to d isrup tion. Ap proxima tely 300 d isagreements have b een suc ce ssfully resolvedthroug h the a greem ent s d ispute resolution c lause sinc e the agreement was signe d in Ma y1989.

The e ffec tiveness of the Boston Harbor PLA in resolving d isputes and ensuring lab orharmo ny has been we ll doc umented . Simila rly, a lega l c ha lleng e aga inst this agreementhas been we ll c hronicled in leg a l journals. The c ha lleng e c ulminated in a landma rk UnitedSta tes Sup rem e Court dec ision issued Ma rc h 8, 1993 when the a greement s lega lity wasupheld unanimously.

In b rief, the c ourt ruled tha t the MWRA, ac ting in the role o f a c onstruc tion owner, had thesame right as a p riva te o wner to utilize p rojec t lab or ag reements authorized by theNat iona l Labor Relations Ac t. As the c ourt sta ted , Ab sent a ny express or imp liedind ic a tion b y Cong ress tha t a sta te may not ma nag e its ow n property when pursuing apurely p rop rieta ry interest suc h a s MWRA s interest he re, and where a na logous privatec ond uc t w ould be permitted , this c ourt will not infer suc h a restric tion. (Massac husettsWater Resourc es Authority, et a l vs. Assoc iated Builders and Contrac to rs ofMa ssac huset ts/ Rhode Island , Inc ., et a l).


15/22

January 2001




Taking an Aggressive Role in Safety

Althoug h individua l c onstruct ion cont rac tors have the p rimary responsibility to e stab lish,

imp lement a nd ac tively ma intain effec tive safety p rog ram s, the CM has de velop ed ap rojec t-wide sa fety p rog ram w ith whic h a ll ind ividua l sa fety p rog rams must c om ply.

The p rojec t-wide sa fety p rog ram run by the CM b eg ins with sa fety o rienta tion fo r newwo rkers and includes follow -up instruc tion d uring the first six mo nths on the job in order topromote sa fety c onsc iousness. The CM a lso ha s deve lop ed and imp lementedadministra tive p roc ed ures for eme rge nc y med ic a l response, ha zardous wa ste d isc ove ryrespo nse a nd ac c ident response, and provided an on-site m ed ic a l sta tion. The CM a lsoc onduc ts sa fety inspec tions of a ll c ontrac tors on a reg ular ba sis. The MWRA s c onstruct ionc ontrac ts req uire ea c h gene ral co ntrac tor to d evelop a nd implement a safety p lan. TheCM review s this p lan to ensure its c onsistenc y with the c ontrac t req uirem ents and m onitorsea c h co ntrac tors c omplianc e with its own plan.

To da te, w ith over 36 million expo sure hours rec orded, the lost time inc idenc e ra te on theBoston Harbor Projec t is 40% lowe r tha n the na tiona l ave rage fo r hea vy c onstruct ion.

One o ther com po nent of the safety p rog ram , the substanc e a buse p rog ram , deservesspec ial rec og nition. The BHP CM negot iated a c om prehe nsive substanc e abuseagreem ent with the Build ing and Construc tion Trade C ounc il of the Metrop olitan Distric t,effec tive August 1, 1991. The prog ram req uires new hires on the Boston Harbor Projec t topass a p re-employment d rug test. A substanc e a buse te st w ill also b e a dministered whenthere is rea sona b le susp ic ion tha t a wo rker ma y be under the influenc e o n the job or afterac c ide nts on the p roject. No rand om testing was inc luded in the prog ram .

Throug h the eight-yea r history of the prog ram , ap proxima tely 4.6 pe rcent of those testedhave fa iled . The a nnua l perce nta ge ha s va ried w ithin a ve ry narrow band from 4.5 to 4.7percent. Both labor and ma nage ment leg itima tely tout the program s suc cess.

Deve loping and Administering Effec tive Change Order Proc edures

A key ma nage ment go a l of the Boston Harbor Projec t is to keep the c ost of c hange ordersand c laims on p lant c onstruc tion (exc lud ing the two ma jor tunnel projec ts) within 10% ofthe a wa rded va lue of c onstruc tion c ontrac ts. This is an imp ortant ta rge t bec ause it reflec ts

the pe rforma nce of bo th the project s de sign and c onstruc tion ma nag ement a pp roa c h.Conside rab le effort has be en ma de by the CM and the MWRA to d evelop e ffectivec hang e o rde r and c laims proced ures that include c hec ks and ba lanc es to safeg uard theexpend iture of pub lic funds. The c hange order p roc ed ures req uire an initia l ana lysis tode termine the leg itima cy and m ag nitude o f the proposed c hange order and a d eta iledana lysis tha t includes the p rep ara tion o f indep end ent fa ir c ost estimate s and sc hed uleana lyses. All c hange orders a re p roc essed initia lly by a ded ic a ted CM c ontrac tadministra tion sta ff loc a ted on site tha t interac t c losely with resident eng inee rs and c ost


16/22

January 2001




and sc hedule ana lysts. Ultimate signa tory authority, however, resides with MWRA sta ff. Thefinal set tlement of c hange orders is, on a verage, 37% less tha n the c ont rac tor s p rop osa l.

The a wa rd value of p lant c onstruct ion va lue (exclud ing the two ma jor tunne ls) is $2.04b illion. The c hange order percentage on these c ontrac ts, with the c ontrac ts 99.3%c om plete, is 12.3 % of the o rigina l b id p ric e, exceed ing the program target. As with manylarge-sc a le p rojec ts, a d isprop ortiona te share o f the c hang e o rder inc rea se is a ttributab leto a handful of spec ific c ontrac ts. In the c ase o f the Boston Harbor Projec t, twoc onstruc tion p ac kag es, the reha b ilita tion o f an existing p ump sta tion a nd c onstruc tion o fan on-site therma l/ po wer plant gene rate d a large volume of c hange o rde r ac tivity. Thepump sta tion was the o nly p roc ess fac ility reha b ilitate d a s part of the Boston Harbor Projec tand during c onstruc tion numerous unforeseen p rob lems, many a ttributab le to yea rs ofneg lec t, resulted in the c ont rac t increa sing from $59 to $96 million. Similarly, the on-site/ therma l power plant presented unique c hallenge s as one of the few large po werp lants eve r built und er the c onstra ints of Massac husetts public b idd ing laws and the c ost o f

this p rojec t esc a la ted from $54 to $98 million. Exclud ing these two p rojec ts, the c hangeorde r percentage for non-tunnel projec ts dec rea ses to 8.9% of the awa rd va lue. (It shouldbe no ted tha t the c hange order perce ntage s d isc ussed in this sec tion include all off-c ontrac t c la im settleme nts.) Cha nge orders and settlements assoc ia ted with the $451million in tunnel c ont rac ts rep resent 64.3% of the orig inal bid va lue.

Planning for Construction Support Services

Among the major contributions ma de b y the CM w as the p lanning fo r site -w idec onstruct ion support servic es c ontrac ts. These c ontrac ts provide c entra lized services suc h

as wa ter transportation fo r equipm ent and ma teria l, ferry transportation o f workers,hazardous wa ste rem ed ia tion, sec urity, conc rete supp ly, roa d ma intena nce, trash d isposa l,fuel supp ly, rod ent c ontrol, snow remova l and on-de ma nd c onstruc tion servic es ford iverse small-sc a le needs suc h as trailer hook-ups and hayba les a long the shoreline. Thetota l do llar value o f these c ontrac ts is approximate ly $188 million.

The early involveme nt of the CM in the p lanning and proc urement o f these servic es wa sc ritic a l in the overa ll suc c ess of the p rojec t. The site s rem ote loc a tion and the restric tionsplac ed upon the authority to mitiga te the p roject s imp ac t on neighb orhood communitiesby extensive use o f a wa ter transportation system inc rea sed the c om plexity of a n a lrea dyc om plex construc tion projec t. With a substantia l p re-c onstruc tion planning effort, the

d ifficulties posed by working on an island -site have b een overc om e. The transportat ionand othe r suppo rt system s functioned routinely and without p rob lem s.

Quality Assuranc e/ Quality Control (QA/ QC)

The CM ha s undertaken an aggressive QA/ QC p rog ram for the Boston Harbor Projec t.Although the c ontrac tor has the responsibility for qua lity c ontrol, the CM routinely mon itors


17/22

January 2001




c ontrac tor co mp liance w ith its (contrac tor) Qua lity Control Prog ram . The CM s ac tivitiesinc lude: (1) prep aring a c hec klist that c lea rly de fines the req uirem ents of the c ontrac torsQC p rog ram; (2) develop ing a list of c ritica l eq uipme nt for which the c ontrac tor isexpec ted to p rovide off-site inspe c tion; (3) c onducting a udits of eac h c ontrac tor to verifytha t the Q C p rog ram is being imp lemented; (4) trac king the a ud it find ings to m ake suretha t the c ontrac tor has respond ed sat isfac torily to the find ings; and (5) analyzing audittrend s to de termine if and where p rog ram-wide mod ific ations are need ed to imp rovequality.

Over the c ourse of the projec t, the C M p erformed 185 qua lity a udits involvingapproximate ly 36,000 individua l observa tions. Ap proximate ly 3,230, or less tha n 9% of theseaudit observations identified unsatisfactory work or materials requiring contractorc orrec tion. The CM s QA/ QC p rog ram has proven a highly cost effec tive mana gementtoo l whic h saves mo ney b y minimizing the required amo unt of rewo rk by c ontrac tors while

insuring qua lity c onstruct ion tha t mee ts design spec ifica tions.

Overall Performance o f the BHP Management Structure

In eva lua ting the o verall performa nc e o f the BHP ma nag ement struc ture, two questionsmust be a nswered :

v Has the manage ment model bee n effec tive in ma nag ing the BHP, i.e.c ontrolling p rojec t costs and m ainta ining sc hed ule?

v

Has the mana gement mod el bee n effic ient in manag ing the p rog ram , i.e. arema nag eme nt c osts a rea sonable perc entag e o f total projec t c osts?

Manag ement Effec tivenessIn Ma y 1988, the Boston Harbor Projec t was projec ted to c ost $2.6 b illion in co nsta nt d olla rswith no a llow anc e for contingenc ies. Esc a la ting this baseline c ost at 7% per yea r, theprog ram was forecast to b e c omplete d a t a tota l c ost of $4.0 b illion. With ove r 99% ofc onstruc tion c ompleted , the c urrent p rojec ted c ost to c om plete fo r the p rojec t is $3.55b illion o r $450 b illion b elow the o riginal c urrent d olla r budge t estima te. Viewed anotherwa y, over the past 12 yea rs, the c ost of the Boston Harbor Projec t ha s inc rea sed a t an

average a nnua l ra te o f 2.62% per year from the o rig ina l $2.6 b illion constant dolla r estima teprep ared in 1988.

A key element in c ontrolling the c ost of the Boston Harbor Projec t ha s been effec tivema nag ement of the projec ts c onstruc tion sched ule. Effec tive sc hed ule ma nagement isa lso important bec ause it has ena b led the MWRA to c om ply, to the g rea test extentfea sible, with the c ourt-ordered sc hed ule, a fundamental program ob jec tive. The BHP


18/22

January 2001




ma nage me nt team wa s suc cessful in ma inta ining construc tion prog ress c lose to thisaggressive sc hedule esta b lished a lmost fiftee n yea rs ago:

v Eleven of the 17 c ourt-ordered milestones we re a c hieved on o r be fore themilestone da te.

v The milestone for sta rt-up o f the first phase o f the p rima ry trea tment p lant, whichinvolved bringing on-line a ll or part of 17 sep ara te c onstruc tion p ac kages with ac om bined va lue o f $880 million a nd involving the c hec kout of over 32,000ind ividua l comp one nts wa s me t w ithin six months of the milestone da te, desp itethe a dve rse imp ac t of severe winter weathe r.

v The c om plex sta rt-up of the first b a ttery sec ond ary trea tme nt fa c ilities wa sac hieved within seven months of the milestone and the sec ond ba ttery wa sb roug ht on-line a head of sc hed ule.

v With the c ompletion of the third ba ttery of sec ond ary trea tme nt fac ilities, thefina l p rojec t milestone $3.6 b illion construct ion prog ram w ith an orig inal durationof a lmo st 15 yea rs wa s c om pleted within one yea r of its original ta rge t d a te.

The p rojec t d id, howeve r, experienc e its sha re o f setbac ks. Comp letion of the Inter-IslandTunne l wa s delayed by three yea rs resulting in missing the milestones related to transfer ofsouth system flow s to the ne w trea tment p lant b y ove r three years. The Effluent Outfa llTunnel proved an even more cha lleng ing projec t. Originally sc hed uled to b e completedin July 1995, the tunne l was not p lac ed into servic e until Sep temb er 2000, over five ye arsbehind sc hed ule. These delays are a ttributab le to several fac tors. Desp ite, the extensive

ge otec hnica l investiga tions unde r taken p rior to b idd ing the tunnel c ontrac ts, differing sitec ond itions relating to roc k cond itions and the extent o f wa ter inflow s we re enc ounte red inboth tunne ls which adversely affec ted prod uc tivity in mining and lining the tw o tunne ls.Ad d itiona lly, these we re the first d eep roc k tunnels to be c onstruc ted within the Bostonarea in over a ge neration a nd neither construc tion p lanners nor bidd ers fully understoodthe p rod uctivity that c ould be ac hieved with this c omp aratively inexpe rienc ed workforc e.It a lso too k considerab le t ime and effort to e stab lish effec tive-lab or manage ment relations.

Delays in c om pletion of the fina l milestone , the third ba ttery of sec ond ary trea tme ntfac ilities, a re related to anothe r c onc ern identified ea rly (and la rge ly avo ided ) on thep ro jec t c om pet ition w ith the Cent ra l Artery/Third Harbor Tunnel for availab le resources.During the ma jor conc rete p lac eme nt pha se o f the c ontrac t, the c ontrac tor limited the

size o f the wo rkforc e, ap parently out of conc ern over the a va ilab ility of experienc ed ,highly prod uc tive w orkers and the a b ility of his ow n ma nag ement staff, sprea d thinoversee ing several billion d olla rs of ongoing w ork on the Cent ra l Artery, to e ffec tivelyma nage a larger wo rkforce a nd/ or wo rk extend ed hours. As a result, c om pletion of thec onc rete work was delayed by a lmost a year, whic h direc tly affec ted follow -upmec hanica l and electric al work and ab sorbe d a ny floa t in the sc hedule tha t would havea llow ed for sc hed ule slippage whic h often oc c urs during the final stages of c onstruc tion,c hec k-out a nd testing.


19/22

January 2001




Mana gement EfficiencyIn ea rly 1992, p rior to the c om menc ement of ma jor c onstruc tion, PMD ad op ted a g oa l ofkeep ing prog ram m anage ment c osts to less than 10% of to ta l projec t c osts. On the Boston

Harbo r Projec t, program ma nagement c osts c onsist o f PMDs expense budg et, the CMc ontrac t and the ma nag eme nt and c oordination comp onents of the LDE c ontrac t. Thisgo a l was viewed as amb itious, given the extensive num ber of ow ner-supp lied servic esreq uiring C M m ana ge ment and the extensive numb er of co ntrac tors and subc ontrac torsworking o n the p rojec t.

Currently, with c onstruc tion ove r 99% c om plete , these m ana ge ment c osts are a t thetarge ted 10.0% of tota l p rojec t costs. Ma nage ment costs a re now projec ted to be 10.3%of tota l projec t c osts upo n c ompletion a nd c loseout of the p rojec t.

LESSONS LEARNED

The succ ess of the ma nage ment a pproac h is mo st visib ly dem onstra ted in the ab ility o f theprojec t to rema in within bud get a nd rema rkab ly c lose to a n ag gressive sc hed uleestab lished a lmost 15 years ago.

In ac hieving the succ ess noted a bove , the follow ing items we re o f pa rtic ula r imp ortanc e:

v The a b ility to rec ruit a ta lented in-house m anag ement team The c rea tion o f a spec ia l unit w ith a c lea r, finite a nd som ew ha t a ll-consuming m ission led to anab ility to a ttrac t a talented and experienc ed group o f individua ls who w ere

ded ic ated to mo ving the p rojec t forwa rd.v The a b ility of the MWRA to reta in ad eq ua te c ontrol of the prog ram The size o f

PMD wa s adeq uate to ma inta in control and p rovide suffic ient d irec tion toc onsultants on the key elements of the projec t. The size o f the team a lso w asadeq uate to assign c lea r respo nsib ility a mong ind ividuals and to monitor theirp rog ress in ac hieving their ob jec tives.

v Priva te sec tor resources have helped to p rovide nec essary expe rie nce andresources p riva te sec tor firms supp lied 450 of the approxima tely 500 mem bersof the PMD/C M/ LDE ma nag eme nt team a t peak staffing. It would have b eenextremely diffic ult for the MWRA to have a ssem bled a tea m of tha t size a squic kly for a p rojec t w ith a finite life. In add ition, the CM a nd LDE tea ms haveprovided senior personnel with extensive world-wide experienc e in la rge-sc a leprog ram/ c onstruc tion m ana ge ment and a ll eng ineering d esign d isc ip lines neither of whic h c ould be rep lic ated in a newly created pub lic authorityunde rtaking a single mega -projec t.

v Construc tab ility and op erab ility co nc erns have been well-integ ra ted into thedesign p roc ess The va lue eng ineering proc ess led by the CM ha s broug ht


20/22

January 2001




va luab le insights to the design p roc ess and m ay avo ided potentia l c onstruc tionproblems which may ha ve b een e ncountered without early c onstruc tion input.

v Pre-c onstruc tion planning for key log istic al e lements of the projec t w asc om pleted a t an ea rly stage The ea rly involveme nt of a p rog ram / c onstruc tionma nag eme nt firm led to the c ompletion o f plans and spe c ific ations for thewa ter and bus transportation system s, a remo te c onstruc tion layd ow n a rea , anon-site c onc rete ba tc h p lant and othe r support servic es. These e lements p rovedc ruc ia l to the suc c essful comp letion o f the Boston Harbor Projec t b ec ause of thec onstra ined c onstruc tion sites and the restric tions p lac ed upo n the MWRA tomitiga te the projec t s imp ac t on ne ighb oring c ommunities by extensive use o f awa ter transportat ion system .

The p rojec t sponsor, the MWRA, has used a variety o f ma nage me nt and c ost c ontroltec hniques to p rod uc e signific ant financ ial savings. The MWRA, assisted by the p rivatesec tor resources of a c onstruc tion manage ment firm a nd a lea d d esign eng ineer, hasma nag ed to maintain the vigorous pa c e set b y the c ourt-ordered sc hedule. In a p rojectwhere the c ost of d elay is estimate d to b e $2 million p er week, the a b ility to kee p onsc hed ule is a c ritic a l c ost c ontrol fac tor.

Crea tive and imag inative d esign, planning a nd m a nag ement a lso ha ve c ontributed toc ost savings. Design c osts a re running a pproxima te ly 4.3 percent o f construct ion costs, we llbelow the industry standard , partly due to the a dop tion o f projec t-wide design standardsand the suc c essful app lica tion o f CADD. Value eng ineering review s have saved $195million to d a te.

Substantial cost savings were a lso genera ted by extremely c ompetitive c onstruc tion b ids.Bids were ultima tely more tha n 10% below estima tes by the c om pletion o f b idd ing.

Contributing fac tors inc luded the reg iona l slow dow n in the c onstruc tion industry in the late1980s and ea rly 1990s, combined with the MWRA s a ttem pts to ma ximize c om petitionthroug h an a gg ressive outrea ch program a nd b y seg reg ating the projec t into sma ller,d isc rete c onstruc tion co ntrac ts. In ad d ition, the MWRA worked on red uc ing b idc ontingenc ies by c ollec ting a substantial amo unt of g eote c hnic al data and inc luding risk-sharing provisions in its construction contracts.

Desp ite the many suc cesses, the ma nage ment ap proa c h also enc ounte red som ediffic ulties. For exam ple, a period of ad justme nt wa s needed for the two p riva te sec torfirms to deve lop a smooth and effec tive wo rking relationship . As noted previously, the firmswere selected sep arately by the MWRA a s op po sed to a joint venture c rea ted by the two

firms. Joined tog ethe r by the ow ner, the firms had to set out the a pprop ria te repo rting a ndwo rking rela tionship . Of pa rticular imp ortanc e was the a b ility to deve lop a smoothrelationship in design whe re the CM had a limited but c ritica l role review ing va lueeng ineering, Construc tib ility and op erab ility. Tea mw ork rea c hed its p innac le when it ca meto sta rting fa c ilities, and whe n the req uired expe rtise o f a ll pa rties wa s nee ded to ensuresmo oth op erations.


21/22

January 2001




Som e d iffic ulties a lso w ere experienc ed in introd uc ing a new and elite group such as thePMD into a n existing p ublic age nc y. The PMD wa s struc tured to b e a sma ll ma nage mentteam d rawing resourc es from private sec tor firms and a lso from other d ivisions within theMWRA. For examp le, PMD had one c om munity relations spec ia list who ha d to wo rk c loselywith the a uthoritys public a ffairs dep artme nt and a single financ ia l p lanner who w orkedc losely with the financ e d ivision. The M WRA s other d ivisions not only provide d support tothe Boston Harbor Projec t but a lso served a ll the a uthoritys other ca pital and op eratinggroup s. As with the rep orting rela tionship a mo ng PMD/ CM/ LDE sta ff, the relationshipbetwe en PMD a nd other d ivisions req uired c learer definitions of roles and responsibilities inorder to produc e a smo oth a nd e ffec tive working rela tionship .

The integ ra tion of p lant op erators into the organiza tional struc ture a lso c ould ha ve b eenimp roved. Op erab ility input into d esign c ame a lmost exc lusively from c onsultants.Op erators of the p revious fac ility co uld no t pa rtic ipa te due to the overwhelming b urden ofrunning the old p lant. Although the senior ma nag eme nt team for the new p lant was

rec ruited in 1992 and 1993, their a ttention was d iverted to running the previous fac ility, w ithlittle time ava ilab le for input into the remaining d esign a nd c onstruc tion of the newfac ilities. The m ajority of input from p lant sta ff ca me during the c hec kout and testingproc ess, which led to c hange s being ma de very la te in the c onstruc tion p roc ess. Analternate a pp roa c h might have been to ha ve a private op erato r hand le the fac ility duringthe first yea r of operations with age nc y sta ff in tra ining mo de until a ll b ugs we re w orkedout. This approa c h ma y have ta ken the initial burden away from the o perating sta ff anda llow ed for even m ore tra ining of the MWRA s p lant sta ff.

Another lesson lea rned wa s the need to c ontinue holding o perab ility reviews throug houtc onstruc tion. Desp ite the nume rous review s held throug hout the design cyc le, the sta rt-up

effo rt o f the first fa c ility wa s ha mp ered in pa rt b y routine d esign e rrors and om issions.Subseq uently, a series of add itiona l de sign reviews entitled System Integrity Reviews wereinitia ted during construc tion p rior to mec hanic a l and elec tric a l insta lla tion. The reviewswere extreme ly effe c tive in eliminating routine sta rt-up issues. Althoug h the reviews led tolate c hange orders, these were ge nera lly less p rob lema tic a nd less c ostly tha n end uringthe sta rt-up d iffic ulties and even later c hange orders.

Lastly, and a lso p ertaining to sta rtup , it be c ame apparent a fter the c hec k out o f the initialfac ilities tha t a d ed ic a ted c hec k-out/ testing team wa s nec essary to help residenteng ineers sta rt up these c om plex fac ilities. The sta rt-up team was led b y an individua l withextensive experienc e in sta rting la rge industria l plants. The d ed ic a ted c hec k-out tea m no tonly broug ht spec ia lized tec hnic a l experienc e to eac h sep ara te fac ility sta rtup b ut carriedthe lessons lea rned forwa rd to the next fac ility.


22/22

January 2001



CONCLUSION

The manag ement a pproach used for the Boston Harbor Projec t has partic ular relevanc e tonew or understa ffed pub lic agenc ies c harge d with the responsibility of c om pleting m assive

and c omplex pub lic wo rks projec ts. The ma jor elements of the ma nag ement ap proac htha t have led to succ ess are:

v The c rea tion of an in-house projec t management team d ed ic ated to the mega-projec t, which foc uses age nc y resources on the projec t a nd a llow s existing sta ffto c ontinue to c arry out the a ge nc ys ong oing mission.

v The recruitment of a n in-house p roject ma nag eme nt tea m w ith bo th pub lic andprivate sec tor expe rienc e a nd a broad diversity of p rog ram ma nag eme ntexperience.

v The use of substa ntial p rivate sec tor resources to fulfill the p rojec t s extraordinary

sta ffing req uirem ents and to b ring spec ialized skills and experienc e to themanagem ent team.

v The e arly retention o f a CM prior to selec tion of the design tea m.

v The designation o f a sing le entity w ith sole responsib ility fo r manag ing day-to -dayac tivities to e nsure sc hedule a dhe renc e and bud ge t c ontrol.

v The c rea tion of an independ ent owne r s rep resenta tive with the rem ova l of oneprivate sec tor firm from a ny responsib ility for design, construct ion and ma terialeq uipment supp ly; and

v The imp lementa tion o f numerous c ost c ontrol tec hniques designe d to reduc ec osts and ma inta in quality.

These e leme nts ha ve bee n c ritic a l in keep ing the $3.5 billion Boston Harbor Projec t inc om plianc e with the rigo rous c ourt-enforc eable schedule a nd c an b e a pp lied to otherpub lic ag enc ies and private sec tor owners fac ed with similar program ma nag eme ntchallenges.

KEY WORDS: Construc tion Ma nag ement, Boston Harbor Cleanup , Projec t LaborAgreement, Value Engineering, Constructibility, Design Management

About the AuthorsWa lter Armstrong is Vice President of Ca mp Dresser & Mc Kee in Camb ridg e, MA a nd RalphWallace is Direc tor, Prog ram M anagem ent of the M assachuset ts Water Resources Authority

in Bosto n, MA .

boston harbor project

Documents