Synthesis of Information Related to Highway Practices. Topic 55-09. Open-books Pricing Practices for Construction Manager/General Contractor and Progressive Design-Build Projects

The use of open-books price negotiations in Construction Manager/General Contractor (CMGC) and Progressive Design-Build (PDB) projects is becoming increasingly popular due to its benefits, such as increased price transparency. It also provides an opportunity for price-informed design decisions, which can potentially retire major risks prior to establishing the negotiated construction price and reduce the size of the contingency pool carried into the final agreement. Many state departments of transportation (DOTs) have experience using open-books negotiations in CMGC and Public Private Partnership (P3) projects, and a handful of state DOTs will have developed procedures for PDB that generally mirror the DB portion of P3 projects. However, there is currently no guidance on how to configure the procedures for open-books price negotiations, how to articulate those procedures in procurement documents, and the effectiveness of the procedures in use. The objective of this synthesis is to document state DOTs practices related to developing open-books price negotiations for CMGC and PDB. Information to be gathered includes (but is not limited to): (1) State DOT procedures for open-books negotiation in CMGC and PDB processes; (2) Open-books process for risk allocation and contingencies' establishment; (3) Open-books implementation policies and procedures in state DOTs (including utilization of an Independent Cost Estimator; and (4) State DOT procedures for utilizing the "off ramp" in CMGC and PDB if an impasse on price is reached or if the agreed price exceeds the available funds.

• Record URL:
  http://apps.trb.org/cmsfeed/TRBNetProjectDisplay.asp?ProjectID=5476
• Supplemental Notes:
  • Contract to a Performing Organization has not yet been awarded.

Language

• English

Project

• Status: Proposed
• Funding: $55000
• Contract Numbers:

  Project 20-05, Topic 55-09

• Sponsor Organizations:

  National Cooperative Highway Research Program

  Transportation Research Board
  500 Fifth Street, NW
  Washington, DC  United States  20001

  Federal Highway Administration

  1200 New Jersey Avenue, SE
  Washington, DC  United States  20590

  American Association of State Highway and Transportation Officials (AASHTO)

  444 North Capitol Street, NW
  Washington, DC  United States  20001
• Project Managers:

  Nasri, Arefeh

• Start Date: 20230807
• Expected Completion Date: 0
• Actual Completion Date: 0

Subject/Index Terms

• TRT Terms: Construction management; Contract administration; Design build; Pricing; State departments of transportation
• Subject Areas: Administration and Management; Construction; Finance; Highways;

Filing Info

• Accession Number: 01884764
• Record Type: Research project
• Source Agency: Transportation Research Board
• Contract Numbers: Project 20-05, Topic 55-09
• Files: TRB, RIP
• Created Date: Jun 9 2023 7:20PM