Sec. 14.39.04.06. Construction Management at Risk

A. General.

(1) Construction management at risk means a project delivery method in which the LEA engages a construction manager at risk (CMR) to:

(a) Contract directly with trade contractors; and

(b) Provide a guaranteed maximum price for project procurement and construction.

(2) The CMR warrants that the work will be completed at or below the guaranteed maximum price with provisions for change order adjustments for work that is outside the agreed-upon work scope.

(3) Cost savings resulting from projects completed below the guaranteed maximum price may be shared between the LEA and the CMR.

B. Guaranteed Maximum Price.

(1) Guaranteed maximum price (GMP) means an arrangement between the LEA and the CMR in which the total amount payable to the CMR for the project is restricted to a pre-agreed maximum and includes the cost of construction and construction management services that is generally determined before the design is complete.

(2) The LEA and CMR may determine the guaranteed maximum price as follows:

(a) In competitive sealed bidding or quality based selection, the guaranteed maximum price is based on construction documents that are sufficiently developed to allow bidders to reasonably estimate and include costs for unspecified items, and includes:

(i) Cost of the work;

(ii) Construction management fee; and

(iii) General conditions; and

(b) In competitive negotiation, including projects in which a construction manager has provided pre-GMP services, the LEA may begin negotiations to establish a guaranteed maximum price with the construction manager only after:

(i) The LEA has provided public notice of its intent and a request for competing proposals; and

(ii) At least 28 days have elapsed for receipt of competing proposals.

(3) If the LEA receives competing proposals, the proposals shall be evaluated in accordance with COMAR 14.39.03.

C. Notice to IAC.

(1) Not later than 2 months before the release of solicitation documents to offerors, the LEA shall provide written notice to the IAC or its designee that the CMR method will be used.

(2) The LEA shall acknowledge in the notice that the State is not responsible for any project cost overruns.

(3) Not later than 1 month before release to offerors, the LEA shall submit the solicitation documents to the IAC or its designee for approval.

D. State Reimbursement.

(1) State funds may be used to reimburse:

(a) Allowable pre-GMP costs only if related to the solicitation of trade packages; and

(b) Allowable post-GMP costs.

(2) Allowable post-GMP construction management services, as determined by the IAC, shall be included in total construction cost as if the CMR were a general contractor for purposes of determining the maximum State construction allocation, payment of requisitions, and project close out.

(3) Total State reimbursement of eligible costs may not exceed the lesser of:

(a) The State's share of the guaranteed maximum price based on the cost-share formula; or

(b) The maximum State construction allocation.

(4) If an LEA intends to seek State reimbursement of any of the construction management services, the services shall be procured through one of the procurement methods provided in COMAR 14.39.03.

E. Trade Contracts.

(1) The CMR assumes all risk for cost, schedule, and performance of the trade contracts except for a trade contract that the LEA separately procures.

(2) Trade contracts may be procured concurrently or over the life of the project.

(3) After the guaranteed maximum price is finalized, any trade contract previously awarded by the LEA may be assigned to the CMR who then assumes all risk for coordination and completion of the trade contracts.

(4) Subcontracts solicited by the CMR as components of the final guaranteed maximum price do not require IAC approval.

(5) If the LEA intends to award a separate trade contract, the LEA shall submit the trade contract to the IAC for approval notwithstanding the subsequent inclusion of the trade contract in the guaranteed maximum price.