Agenda - Council - 02/14/1995 - Laserfiche WebLink

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I i I I I I i I I I I I On more unique types of ~rojects, particularly comprehensive studies, a consultant's past experience with similar types of work can be particularly beneficial in providing quality work in a cost-effective manner. In such case, the normal short list may be expanded, or even bypassed, to solicit~u~l~ficafions from firms who have special expertise in the field of work desired. Once ~ short list for a project is determined, actual selection can be based on a number of methods, a) ~ Rotate project assignments. This assures that all consultants making the short list will have ~ an opportunity to demonstrate their ability. b) ~ Interview and make selection on the'basis of specie project qualifications. One consultant has experience, which may make them more familiar with a project. Such a consultant may be the logical choice. Compensation might be provided on a cost plus fixed fee basis, or ~ could be negotiated. c) ~ Select consultant submitting the lowest lump sum cost. This is the method ctm'enfly being ~ 'used. Meth°d~ of CompensatiOn: Below is discussion of various methods of compensation for engineering services which are in a) i ?~r%m~e of cons~c~on cos~: T~ is an inhe~nt parado× her~ in that ~r~y economical design r~duces the fee, while poor design leads to a higher fee. Also, it is difficult to properly relate work complexity to a reasonable percentage fee; obviousIy, the design effort in designing a s~t re-surfacing is considerably less than that for new wastewater plants ~ costing the s~'~ to build. Manual 45 of the An~rican Society of Civil ~ngineers states tha~ "the present relationship between engineering costs and construction costs...is no longer ~ valuable as a guide for deter~uing engineering costs for a given project", which is why ~ use of this fee basis has declined. Actual cost ~Ius fixed f~: Documentation and review of the costs can requke considerable detail and ~lmiuistrative time. Some costs are ~sier to identify and control than others; for ~ example, telephone and travel may se.~m easily identifiable and therefore controllable, but ~ there can be disputes about the need and extent of such costs. Personnel cost ~ administration can be difficult because of overhead items and questions on how many ~ people were used and in what classifications. It may be appropriat~ to establish selected ~ "upset maximum" figures in the agreement to give ~'~ter client control. The fixed fc~ ~ should include the entire profit for the job, but should exclude sal~_ries of fkm principals ~ which should b~ paid a~ personnel costs. This fee basis is frequently used, but it can ~ require clos~ monitoring than many local agencies find practical. It can be a sound ~ compensation basis for projects ranging from small jobs or ~uor additions to major contracts, and it is also useful for compensating management consultants. b) c) I t Salary cost times a multiplier plus incidental costs: The multiplier (may range from 2.2 to 3.3) is intended to cover personnel benefits and overheads, general office costs, profit, and general overhead, with travel, long distance phone, printing, and other such incidentals being separately paid. The client should insist on det~i!s of the overheads and other items which make up the multiplier and documentation of the types and numbers of personnel which have been charged. Again, this method should include "upset-maximums" and can involve significant administrative and review expense for the agency. This approach is still I I I I I I I I I I I I I I I I ! I I