Construction SuperConference 2017

Sessions Speakers Exhibitors Floor Plan Buzz

E20 Transportation Design-Build and P3 Projects -- Pushing the Limits of Reasonable Risk Shifting? (Room Chopin 2)

One of the most heavily touted advantages of design-build and greenfield P3 projects is the extent to which the design builder/developer assumes many of the design and construction risk typically assumed by the project owner. This can create tremendous opportunities for savings and creativity, but also tremendous risk for the contracting components and ultimately assume that risk. The assumption of design risk can be relatively straightforward, but the strings attached by the owner or government sponsor may complicate the clarity of the freedom to innovate in design. In addition, shifting all risks associated with right-of-way acquisition, utility relocation, permitting and related third-party litigation, can push the limits of what the design builder or developer can assume without potentially placing the entire project in jeopardy. This session will explore how the advantages and opportunities of Design-Build and P3 on transportation projects can be maximized, but also how the shifting of traditional owner risks can potentially exceed the limits of practicality and what the market can really bear and simply take a good thing too far, leading to catastrophic losses and monumental disputes.

Upon completion of this session, participants will be able to:

  • Understand the fundamental shifting of owner risks to the design-builder or P3 developer that is reflected in major transportation projects, far beyond the relatively straightforward shifting of design responsibility.
  • Understand how the shift of design responsibility to the design-builder or P3 developer can nonetheless come with strings attached, either contractually or in practice regardless of the contract, that saddle the design-builder or P3 developer with design responsibility, but deny the flexibility believed to come with that responsibility.
  • Understand the manner in which many design build contracts and P3 Contracts place the responsibility on the contractor for critical activities that are typically considered governmental activities that require the power of the government to implement. Such as right-of-way acquisition, utility relocation, and toll enforcement, and the challenges associated with executing such responsibilities for a private entity, especially with the dramatically reduced avenues of relief typically associated with construction and even other forms of design build.