Once the committee and construction professionals have agreed on the scope of work, it must be put it in writing. In drafting the scope of work, be as specific as possible. Keep in mind that three different construction estimators could address an issue differently. They could give three different prices and maybe not address the issue in the way the committee was expecting, unless they spell out the scope of work. If an architect is hired, part of his blueprint package should be a specification package. It is in this package that the architect spells out the details. If the congregation is not utilizing the services of an architect, then draft your own specification package. The main point here is to spell out what the group wants done, how they want the tasks to be completed, what building materials they expect, indicating the type, brand name, finish, color, quantity, quality, installation method, etc.
The following pages show two contractors whose proposals are bidding on the same work… or are they?
Proposal for: His Way Worship Center Worship Center Way
We submit our bid to paint all of the drywall in the church building.
Terms: 1/3 at contract signing
Balance upon completion
Agreed and accepted:________________________________________
Proposal for the His Way Worship
CenterWorship Center Drive
We submit our bid to properly prepare all of the newly installed drywall in the church sanctuary by giving the drywall a final sanding using 320-grit sandpaper. A thorough cleaning of all of the drywall surfaces, using dust absorbent cloths, will follow this sanding. Next, we will paint the drywall using rollers with 1 coat of Sherwin Williams Pro Mar 200 Primer/Sealer. Once all of the walls of the sanctuary have been properly prepared and primed, we will release the space back to the drywall contractor for final point up. Point up and sanding to be completed by the drywall contractor. This point up of the newly primed drywall must be completed within two working days from the date the surface has been released to the drywall subcontractor. Once the drywall point up has been sanded, we will clean all of the drywall once again using both cloths and a vacuum system.
Next, we will apply two coats of Sherwin Williams Pro Mar 200 latex paint (1234 – Church White) to all of the drywall surfaces in the
sanctuary. Paint application shall take place by utilizing an airless spray unit at a pressure of 1200 psi. One painter shall use the sprayer to apply the paint while simultaneously, a second painter will be back rolling the paint onto the surface using an 18-inch smooth nap roller.
We will complete any necessary touch up as required; however, we are not responsible for touch up painting due to damage caused by other contractors, sub-contractors or vendors while work is in process.
Terms: 1/3 with contract signing Balance upon completion
As illustrated in these examples, the price from both contractors is the same, but one is not certain if the scope of work is the same.
To ensure that all bidders know what is expected of them, make sure that sufficient details are listed in the scope of work. Remember, lack of specificity in the scope of work can lead to change orders from contractors who can make a valid argument that the directive was not explicit enough, and that the issue you’re sure was covered in the original bid, was not covered.
If it is not spelled out in the scope of work, it probably won’t be done. Spell out in detail exactly what is to be completed, how it is to be completed, what materials are to be used, and what application methods are to be used.
CONTRACTS, CHANGE ORDERS AND PROJECT DOCUMENTATION
What is a “Contract”?
A contract is defined as a set of promises. In order to be enforceable, all contracts must contain the following elements:
¨ There must be an agreement between the parties, “a meeting of the minds” on the subject matter of the contract.
¨ The subject matter must be lawful.
¨ There must be sufficient consideration.
¨ All parties must have the legal capacity to contract and there must be compliance with legal requirements regarding the form of contract. A construction contract must be in writing to be enforceable.
A construction contract is divided into five sections:
Section One– The parties to the contract : each party to the contract is listed.
Section Two – The scope of work – the entire scope of work must be listed in this section. On major projects, a separate book with the written scope of work and the accompanying blue prints will be included as an attachment detailing the scope of work and will be listed as an exhibit to the contract.
Section Three – The cost – This section should include the cost of the work specified in the contract, as well as how progress payments are to be calculated.
Section Four – The Terms and Conditions – Spells out how the project will be administered. Detailed explanations should be spelled out.
Section Five – The signature page – It is not a valid contract if all parties do not sign it.
What type of Contract should be used?
There are three types of contracts typically used in the renovation or construction of PraiseBuildings. They are “Fixed-Fee”, “Cost-Plus”, and “Not-to-Exceed”. There are benefits and negatives to each of these.
When it comes time to hire the contractor, consult with legal counsel as to the form of contract for your project and the specific language to use. The AIA (American Institute of Architects) publishes many standard contracts to be used on projects where the owner has retained an architect. These contracts, while very good and thorough, do tend to favor the architect. One finds on many larger projects some form of an AIA contract will be used.
As with the scope of work, spell out in as much detail as possible the terms and conditions. It is prudent to consult an attorney as to the type and language to be used in the construction contract. .
Preparing Contract Documents
Before a project can be put out for bid, contract documents must be prepared. These typically include the blueprints and specification manual, working drawings and a standard contract form such as the AIA Standard Form of Agreement. The standard contract forms outline the basic requirements of the project. These include duties of the contractor, duties of the owner, duties of the Project Manager, the beginning and completion dates, the contract price, the manner of payment, and the conditions under which change work orders will be executed. The contract price can be figured as a fixed fee (a stipulated sum) or it can be figured on a time and materials basis (cost of work plus a fee) usually with a “not-to-exceed” price written into the contract. Each method has its advantages. Stipulated sum contractors are preferable when the scope of work is well defined, and there is little likelihood that any unknown conditions will be encountered during the construction process.
For example, in a re-painting the sanctuary, most contractors will find it relatively easy to estimate the cost of patch plastering and painting on the square foot area of the wall surface and the cost of the labor to apply the paint. The contractor’s standard contingency fee should cover any unexpected conditions encountered during the course of construction. If the building conditions are unknown, such as with structural issues, and the full scope of work can to be established until the work begins, a time and materials contract with a “not to exceed price” should be considered. First it gives the contractor the flexibility to deal with unexpected problems without having to renegotiate the contract price, provided the work falls within the scope of the specifications. The owner is protected from going over budget by the “not to exceed” price while the contractor’s profits are protected from a “runaway” scope of work since he or she is billing on a time and materials basis.
This sort of an arrangement helps enlist the contractor as an ally rather than a potential adversary in the construction process because the contractor’s profit margin is not affected by dealing with unknown or unexpected conditions. The two types of contracts can also be combined, with some portions of the scope of work billed on a time and material basis within a stipulated sum contract. This arrangement can be used when most of the planned work is clear-cut and easily budget, but some portion of the scope of work has too many unknown conditions to accurately budget.
UNDERSTANDING CHANGE ORDERS
THE IMPORTANCE OF PROJECT DOCUMENTATION
HOW TO HIRE AN ARCHITECT?
Architects, like many other licensed professionals, must pass a comprehensive state test and are permitted to practice architecture only in those states where a valid license is held. Only a person possessing a valid state license and current registration may legally use the title “architect” and provide architectural services. Many architects are members of the American Institute of Architects, a national professional organization. Only those members in good standing may use AIA after their name to denote membership in this organization. Architecture is such a vast and complex discipline that not all architects have the knowledge or skills required to design a PraiseBuilding. When selecting an architect, it is important to interview several that have experience in working with congregations and renovating existing structures. An architect who has only designed new homes or tenant fit-out projects for office buildings, simply will not have the technical knowledge and hands-on expertise to complete a PraiseBuilding without a substantial learning curve.
Many architects have difficulties in understanding the limited budgets facing many congregations. A common complaint by contractors is that after being invited to bid with several other firms on a PraiseBuilding project designed by an architect, the contractor must invest many hours bidding the project out to local sub-contractors and vendors. Once all of the sub-contractors’ bids are returned, the contractor runs the numbers through the estimating department in order to submit a detailed bid back to the architect and congregation. After reviewing all of the contractors’ bids the congregation determines that all of the contractors are over budget.
Several days later, one of the contractors would get a phone call asking them to appear before the property committee, where they would be told that they had been selected by the property committee; however, was there anyway they could reduce the costs of the project by $200,000. How could this happen? Invariably, the architect would ask the property committee what they wanted him to design, whereby the architect took detailed notes and spent several hundred hours designing exactly what they had asked for, complete with detailed architectural drawings and a two inch thick specification book.
The architect would then submit this package to several pre-qualified contractors who would bid on the project. The conversation regarding the amount the congregation had to spend on the project simply didn’t take place. Other times, the congregation did ask the architect what the project should cost, only to be given such a broad range that it was up to the contractors to determine by the bid submissions how close the architect’s guess really was.
Before beginning any construction project, focus on the numbers. Know exactly what the congregation can spend including contingencies. Explain to the architect that the total budget for this project including architectural fees, is “X”. Have the architect design the project around the budget. In order to remain within the budget, the architect may need to divide the project into multiple phases that can be completed after additional funds have been raised. This is called “phasing a project” and is a common practice when working around budget constraints.
SELECTING AN ARCHITECT
When selecting an architect, interview several experienced practitioners or firms who have worked with congregations who’ve had similar projects. You may be able to obtain names and numbers of qualified professionals by contacting your local AIA Chapter. (Addresses and telephone numbers of AIA offices are found in the appendix of this text.) Ask members of other congregations if they might make recommendations. Ask the architect for recommendations and see the work. Learn what the challenges of the design and construction are, as well as the budget. Did the designer successfully accomplish what the committee wanted? Discuss your project in detail. Ask how the architect works with committees. Discuss fee schedules, scheduling, and manpower. Who will be working on the project? What experience does that person have with PraiseBuilding design and construction? Does the architect bring specific design criteria to the project? It is important that you discover if there is “chemistry” between the architect and your congregation. During the construction phase of the project, the architect will be speaking on the congregation’s behalf, so it is important that you have a good rapport with the architect.
Architectural Services are divided into five distinct phases:
I. Preliminary Design Phase – Understanding the site and design concepts that client requires.
II. Design Development Phase – Creation of multiple versions of drawings for client approval
III. Contract Document Phase – The production of detailed work drawings and written specifications.
IV. The Bidding and Contract Phase – Administrating the
bidding phase and contract negotiations.
V. Administration – The architect monitors the work for compliance with the contract specifications; Verify progress payments applications; Attends progress meetings.
CHOOSING THE CONSTRUCTION TEAM
Hiring contractors, subcontractors, and vendors.
Finding a contractor who is capable of handling the complexities of your project may be as easy as consulting your local yellow pages under the heading of General Contractors. Although this method can prove to be hit-or-miss depending on the size of the city or town and the number of general contractors in the areas. The best way of finding a contractor is to talk with the owners of other projects similar to yours. A contractor who mainly does additions on homes may have the skills to complete the renovation of your project, but may not have the manpower or commercial sub-contractor network base to handle the project. Similarly, a large general contractor who builds office buildings and other large structures may not be interested in handling a small project such as the renovation of a PraiseBuilding if the scope of work is substantially less than what the firm normally undertakes. In larger cities, there may be larger general contractor firms that regularly build and renovate PraiseBuildings. If such contractors exist near the metropolitan area of the PraiseBuilding, it is worth inviting them to bid on the PraiseBuilding project since they may bring vast experience and an understanding of working with tight budgets and building committees.
Check references. While there are many professional and honest contractors, there are many fly-by-night organizations who when given the chance, would be happy to take the money and run.
Although many people rely on the Better Business Bureau (BBB) for references, it is important to realize that the BBB is not a government agency. It is a for-profit business who can only report on the business activities of its own members. In order for a company to be listed with the Better Business Bureau, that company had to purchase a membership. Since most states require contractors to be licensed by the state before contracting with the public, it is prudent to verify licensure and any legal or disciplinary action with the state licensing authority.
If the congregation will be undertaking a PraiseBuilding project costing hundreds of thousands of dollars to millions of dollars, it may be prudent to require that the general contractor post a performance and payroll bond. A bond is an insurance policy that protects the owner in case the contractor is unable or unwilling to complete the project or pay his employees or subcontractors. The requirements to secure bonding are strenuous and thus smaller contractors are unable or unwilling to post a bond. Since the building’s owner pays for the costs of the bond, it should only be used on larger projects. However, bonding a project can add a layer of protection to the owner should problems occur.
Before hiring a contractor for any project, it is important that the contractor present a certificate of insurance for general liability, automobile insurance and worker’s compensation insurance, naming the PraiseBuilding as additional insured.
Understanding a Construction Progress Schedule
Before a professional progress manager will begin a major construction project, one of the first steps to be undertaken is the creation of a Construction Progress Schedule. The importance of establishing a progress schedule can be seen in the saved hours of labor, reduction of construction conflicts by overlapping trades, and avoidance of delays in the delivery of long lead items.
How does one establish a progress schedule? The first step is to make a list of every trade (sub-contractor and vendor) and when they are scheduled to begin their work. Next, record the scope of work to be completed, as well as the number of days the work will take to be completed. It is important to note two points. First, if one sub-contractor must complete a specific task or line item before another trade can begin their work, the first contractor must be scheduled with ample time to complete their task.
Secondly, if an item such as specialty windows, pews or custom seating, custom dyed carpeting, artwork or other items scheduled to take many weeks or months for fabrication and delivery, these items should be ordered as far in advanced possible. Before signing a contract with vendors of stained glass, pulpit or bimah furnishings, custom seating or pews, it is very important to discuss delivery dates from the date of a signed contract. Many pew companies may require 9-12 weeks for delivery from the date of a signed contract and approval of finishes and fabric samples. It is also not uncommon to wait six months or longer for custom-made art or stained glass windows.
When creating a progress schedule, allow ample time to complete the assigned tasks. Remember that trades that are required to work outdoors, may require longer time due to weather conditions, especially during the autumn and winter months. When scheduling a multi-month project, it is wise to allow a few floating days to allow for non-productive periods due to weather, delays in receipt of materials, illness, inspection delays, etc. The construction schedule on the following pages shows a typical multi-trade construction project.
The purpose of a construction schedule is to see on paper that all of the trades have ample time to complete their sub-contracts with a minimum of conflict. If a construction progress schedule is completed properly, one should be able to see how long it will take to complete the entire project, and what trades should be completing what tasks at any given time in the project. A progress schedule can allow one to tell instantly if a PraiseBuilding project is on schedule. Thus, a progress schedule can become an important part of the check and balance system of managing the project.