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Scopes of Services for Design Professionals Part 2 – Elements of Design Professionals’ Scopes of Services

By Kevin O'Beirne, PE, FCSI, CCS, CCCA, CDT posted 05-30-2023 04:52 PM

  
This is the second in a six-part series addressing design professionals’ scopes of services, comprised of: (a) Part 1 – Key Concepts and Source Documents; (b) Part 2 – Elements of Design Professionals’ Scopes of Services; (c) Part 3 – Limitations: Introduction and Essentials; (d) Part 4 – Limitations: Construction Documents; (e) Part 5 – Limitations: Permitting and Disagreements; and (f) Part 6 – Elevated Standard of Care, construction Cost Estimates, and Phased Authorizations.
Elements of a Design Professional’s Scope of Services
Presented below are suggested topics that should be expressly addressed in the design professional’s scope of services, unless they are indicated elsewhere in the client-design professional contract. Several of the topics indicated below are not addressed in many design professional’ contracts read by this writer. Such omissions are frequently sources of later disagreements between the design professional and its client.
·   Purpose or rationale: This section of the scope should expressly indicate the project owner’s (and the client’s, if other than the owner) goals for the project, relative to the design professional’s services. Failure of the parties to have a complete, mutual understanding on this basic concept is a frequent source of subsequent disagreements.
·    Project delivery method and management approach: When the design professional’s services are, or may be, part of a capital improvements project (as opposed to a study or consultation on facility operational matters), the scope of services should clearly indicate the project delivery method (i.e., design-bid-build or design-negotiate-build; construction manager at risk, design-build, owner-build, or integrated project delivery) and the project management approach (i.e., whether there will be an owner-retained, third-party construction manager as advisor (CMa) or program manager). When applicable, the scope should indicate when the assignment is performed under a public-private partnership (“P3”) agreement.
Even when the project delivery method and project management approach are not known with certainty at the time the client-design professional contract is signed, its scope of services should indicate the assumed basis for each. The project owner’s subsequent change in project delivery method or management approach (such as retaining a CMa) once the design or construction documents preparation is already in progress is likely to have a significant impact on the design professional’s cost and time of performance. For more on such matters, see “Specifications for Projects with a Construction Manager as Advisor ” (which also addresses program managers)` and “Specifications for Construction Manager at Risk Projects” (which addresses fast-tracking) both on this writer’s blog, and “Specifications for Design-Build Projects” in Construction Specifier magazine’s March 2021 issue.
·    Prime Construction Contracts: Because the number of prime construction contracts is likely to have a significant effect on the design professional’s cost, it should be expressly indicated in the scope of services. A subsequent change in the number of prime contracts should be cause for an amendment to the design professional’s contract, including a change in compensation and time of performance. Multiple prime construction contracts are required by statute for most public work in New York, New Jersey, and Pennsylvania. Certain architect-led vertical construction projects, especially those involving a CMa, may have multiple prime construction contracts. Where applicable, the scope’s provision on prime construction contracts should also indicate the number of separate contracts (if any) for the project owner’s direct procurement (from a seller) of materials and equipment to be installed by a separate, owner-hired construction contractor.
·    Work Packages: Certain project delivery methods, including CMAR and certain types of design-build, are commonly implemented on a fast-track basis using multiple “work packages”. For such project delivery methods, the design professional’s scope of services should indicate the specific quantity of work packages included in the design professional’s budget. The reasons for this are similar to those indicated above regarding the number of prime construction contracts. Failure to indicate a specific quantity of work packages for fast-tracked projects has strong potential to obligate the design professional to possibly greater effort and cost than originally planned.
·    Delegated Design: Delegated design is when the final design of a designated part of the project is expressly delegated, in the construction contract, to a design professional retained by the contractor, subcontractor, or supplier, based on performance and design criteria indicated in the contract documents. For manufacturing and proprietary installation reasons, certain types of work are customarily delegated design. However, because some clients may be unfamiliar with the concept of delegated design and may be displeased to learn, during construction, that their design professional consultant’s final design did not encompass all aspects of the project, it is often wise to expressly indicate in the scope of services those elements of the project that are customarily delegated design.
·   Subconsultants and subcontractors: The design professional’s client deserves to know when portions of the services will be performed by others under subcontracts with the design professional, especially when they will access the owner’s site. Such entities, and the general extent of their work or services, should be indicated in the design professional’s scope of services. If the design professional intends to perform all the services with its own employees, the scope should indicate language such as, “[Architect] [Engineer] intends to perform all the services with its own employees, Should it be subsequently determined that retaining one or more subconsultants or subcontractors is necessary, [Architect] [Engineer] will so advise [Owner] and identify such entities, in writing, by name and address and the general nature of their responsibilities on the Project, prior to entering into such subcontract.”
·   Other entities: The design professional’s scope of services should clearly indicate  others involved in the project not under the design professional’s control. Interacting and coordinating its services with such entities is likely to result in added costs and, perhaps, impacts on the design professional’s time of performance. Such entities may include an owner-hired, third-party program manager or CMa; another design professional retained for a separate project at or adjacent to the project site, an owner-retained, third-party systems integrator who will create or revise the owner’s facility monitoring and control systems; owner-hired testing entities and special inspectors; owner-hired interior decorators; commissioning agents; and others. When there are no such entities or design professional’s services will not include coordination with those entities, the design professional’s scope of services should expressly so indicate.
·    Design standards, codes, regulations, owner’s procedures, and sustainability ratings: Because non-compliance has strong potential to contribute to disagreements between the parties to the design professional contract, specific relevant design standards, codes, regulations, permits, and owner’s procedures with which the services and completed project must comply should be expressly indicated. These may include applicable building codes (see: “Specifying Practices: Laws and Regulations in Construction Documents”, which is also broadly relevant to professional services contracts); the client’s own design, procurement, or construction standards, if any; relevant third-party design standards, such as those of an authority having jurisdiction, such as a state environmental regulatory agency; and any sustainability rating to be pursued for the project. To reduce the potential for creating an elevated and possibly uninsurable standard of care, the design professional should avoid warranting the design or guaranteeing the performance of the subject facilities.
·   Project funding and financing: The owner’s or client’s project funding and financing sources have potential to affect the design professional’s services, especially (1) the design professional’s selection of its own subconsultants and subcontractors, when diversity business enterprise goals apply to the design professional’s contract, and (2) construction documents and, when applicable, contracts for procuring materials and equipment to be separately purchased by the owner.  If the project’s funding is entirely the owner’s own funds, the design professional’s scope of services should so indicate. Otherwise, the scope should clearly indicate the specific activities the design professional is required to coordinate with funding and financing entities. These may include  entity-required report formats and content; entity review and comment on design deliverables; entity review of invoices or construction  contractor progress payment requests and/or use of the entity’s own forms for such  invoices and requests; entity-required meeting and site visit documentation; and perhaps others).
·   Times of performance: Design professional contracts that lack clear indication of the time(s) for performance of the services are surprisingly common. Because time (together with scope/extent and compensation) is one of the three basic aspects of any contract,  it should be clearly set forth in each professional services contract. The times may be indicated as either a number of days from a clearly established milestone or by dates. The times of performance in the scope should indicate:
o   The assumed date on which the design professional may commence performing its services. Such date should not be prior to the date the professional services contract is signed and effective..
o   Required meetings
o   The design professional’s furnishing of each deliverable to its client
o   Times for the client’s and other, involved third parties to review and comment on the deliverables and render necessary decisions.
o   Completion of all services under the scope of services
o   A paragraph stating that delays for reasons beyond the design professional’s control, beyond a stipulated number of days (e.g., 90, 120, or 180 days), will result in the need for an amendment to re-establish the remaining times of performance and compensate the design professional for shutdown, restart, and personnel reassignment
Times of performance can be indicated in a Gantt chart, a simple table indicating activity and due-date, or other method appropriate for the scope of services. More-detailed provisions will typically be more useful as a basis for an amendment (required to change the design professional’s compensation and time of performance) if delays occur. .
·       Services by project phase and task, including:
o   Project management: Despite some project owners contending that project management should be part of the design professional’s business overhead costs, project management is an essential, project cost and should be expressly indicated in the scope of services. Some sources, such as the Project Management Institute (PMI), suggest that project management should account for up to 15 percent of design professionals’ project budget. Whether such a percentage is appropriate for a given project may be debatable, but PMI’s suggestion illustrates that project management is a significant, billable element of any design professional assignment. Project management activities may include: ,
§  Establishing the project’s files (electronic and paper, as necessary).
§  Establishing the project in the design professional’s budget tracking/accounting system.
§  Developing the design professional’s project management plan and other, project-specific quality assurance and quality control planning documents.
§  Preparing and signing subcontracts, if any.
§  Establishing the design professional’s project-specific health and safety plan (HASP) and familiarizing the team with HASP requirements.
§  Preparing for, participating in, and documenting project kick-off conferences, if any.
§  Budget and schedule management, updates and forecasting. These should be done not less often than every two months.
§  Invoicing activities. The scope should indicate a specific invoice format and identify invoicing requirements unique to the client or project.
§  Coordinating the work of internal and external team members.
o   Project conception or feasibility study services.
o   Schematic design and design development (AIA) or preliminary design (EJCDC) services. This stage should not be ignored or shortchanged, because it is typically when most of the significant design decisions are made, materials and equipment types are selected, acceptable manufacturers identified, and relevant calculations prepared.
o   Construction documents (AIA) or final design (EJCDC) services: This stage involves preparation of the construction documents and applications for owner-obtained permits.
o   Bidding/procurement stage services, including:
§  Pre-solicitation services, such as establishing project bidding websites, printing paper copies of the bidding documents, and advising construction information subscription services and plan rooms of the project.
§  Services during the solicitation period, including evaluating prospective bidders’ requests for clarifications, preparing and issuing addenda, services associated with pre-bid conference(s), services associated with the opening of bids or proposals, and possibly other services.
§  Services associated with evaluating the bids or proposals and awarding the contract(s). See: “Award Recommendations: A Guideline for Design Professionals” on this blog.
§  Preparing the final contract(s) for signature by the parties, which may include preparing a notice of award and notice to proceed for issuance by the project owner.
o   Construction stage services, including construction contract administration and, when applicable, resident project representative services.
o   Post-construction services, if any, such as transcribing into the design professional’s CAD files or building information model markups on project record documents, for delivery to the client; post-construction commissioning activities and services associated with submitting final documentation for a sustainability rating; preparation of facility-specific operation and maintenance manuals; correction period and warranty period assistance; operational assistance and optimization; and other services:
·   Additional services are not included in the scope and budget. Certain additional services are dictated by circumstances beyond the design professional’s control, such as responding to emergencies, but are essential to the orderly progress of the project. Thus, the scope should include a list of potential additional services and indicate: (1) services to be performed only upon the client’s authorization, and (2) services to be performed as needed and invoiced as “Additional Services” without the client’s express, prior approval. AIA B101 and EJCDC E-500, among others, each include examples of both types of additional services.
Throughout, the scope of services should have detail appropriate for the project and the client. Some clients may perhaps be somewhat intimidated by what they may consider to be an overly detailed scope of services, perhaps believing that the detail is intended to set the stage for future amendments the design professional is already planning to demand. On the other hand, as will be discussed in detail in the forthcoming third, fourth, and fifth parts in this series of articles, the design professional and owner may have substantial risk when the scope of services is insufficiently detailed.  Also, for projects that may have a long duration, the potential may exist for the client’s or project owner’s personnel to change over time, possibly with individuals new to the project having very different views and personalities than those who originally negotiated the design professional’s contract. As in all business communications and documents, a certain extent of “emotional intelligence” is necessary in developing, negotiating, and finalizing scopes of services.  
Conclusions
The design professional’s scope of services should appropriately indicate the purpose and goals of the project, the project delivery method and management approach, delegated design elements, planned subconsultants and subcontractors, principal, relevant design standards, codes, regulations, and possibly other information. The time of performance should be clearly indicated. The scope of services should be organized by project stage and task, and should include a listing of “Additional Services” not included..
Forthcoming installments in this series include: Part 3 – Limitations: Introduction and Essentials; Part 4 – Limitations: Construction Documents; Part 5 – Limitations: Permitting and Disagreements; and Part 6 – Elevated Standard of Care, construction Cost Estimates, and Phased Authorizations.  

Acknowledgements: The author gratefully acknowledges the assistance of Bruce Firkins, PE, PLS, of Bolton & Menk, Inc., in Minneapolis, MN. Mr. Firkins is the chair of EJCDC’s Engineering (E-Series) Subcommittee and kindly reviewed and commented on drafts of this article.

Copyright 2022-2023 by Kevin O’Beirne

The content of this blog post is by the author alone and should not be attributed to any other individual or entity.

The author of this blog post is not an attorney and nothing in this blog post constitutes legal advice. Readers in need of legal advice should consult with a qualified, experienced attorney..

Kevin O’Beirne, PE, FCSI, CCS, CCCA is a professional engineer licensed in NY and PA with over 35 years of experience designing and constructing water and wastewater infrastructure for public and private clients.  He is the engineering specifications manager for a global engineering and architecture design firm.  He has been a member of various CSI national committees and is the certification chair of CSI’s Buffalo-Western New York Chapter.  He is an ACEC voting delegate in the Engineers Joint Contract Documents Committee (EJCDC) and lives and works in the Buffalo NY area.  Kevin O’Beirne’s LinkedIn page.    

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