Exponent provides guidance to clients throughout all facets of the capital project lifecycle including, risk management, project oversight and management reporting, and dispute resolution. Often times, we are called upon to address specific problems that arise during the construction phase of a contract, and assess the performance of a bonded trade contractor. We are experts in quickly isolating the specific causative factors that have given rise to the issues at hand – either internal or external to the insured’s operations.
The following are the primary services provided by our Surety Consulting Team:
- Distressed Project and Contract Assessment
- CPM Schedule Analysis - Project Completion Scheduling
- Cost-to-Complete Analysis
- Value Engineering and Scope of Work Management
- Contract Negotiations with Project Stakeholders
- Project Controls (Time, Cost, Quality & Safety)
- Completion Contracting Services
- REA Preparation and Expert Testimony
Distressed Project and Contract Assessment
At the core of Exponent’s services to our surety clients is our rapid deployment of construction contracting professionals to the distressed project site. We offer a “24-72 Hour Project Triage” that will expeditiously make an initial determination and recommendation on the distressed project’s status, and the Principal’s role in the events leading up to the surety’s involvement. A typical work flow of our initial response are as shown:
- 24-72 Hour On-Site Project Triage
CPM Schedule Analysis - Project Completion Scheduling
Our CPM scheduling professionals will quickly provide an assessment and analysis of the distressed project’s schedule and move swiftly to prepare an independent CPM project completion schedule for all remaining work to be performed by the Principal, as obligated by the performance bond in place. We will ensure that the completion schedule is comprehensive and includes all activities essential to completing the project in the most expeditious, and cost effective manner.
Hand-in-hand with the development of the completion schedule for the project, Exponent’s team will quickly compile all project data (onsite & home office) and arrive at an accurate completion cost. This cost forecast is arrived at by analyzing more than just contract and subcontract balances, but also a thorough examination of all work required to complete the obligations under the bond that may not have been captured in either the original contract SOW or change orders to date.
Value Engineering and Scope of Work Management
As the completion of the distressed project rolls out, Exponent will diligently stand guard to protect the Principal (on behalf of the surety) from performing unauthorized, out-of-scope work directed by an overzealous owner who may seek to capitalize on the renewed work flow and capital brought on by the presence of the surety to the project team. All too often in situations such as these, an Owner may cause a “scope of work creep” that goes beyond the obligations of the Principal.
Contract Negotiations with Project Stakeholders
Exponent will meet with all key parties to the contract, including but not limited to subcontractors of the Principal, in order to ascertain the current status of the contract(s) and facilitate a smooth transition into the “surety managed” stage of the distressed project. Relations amongst key players are often strained long before the surety is aware of the distressed project, and as such, Exponent’s team will help mend those affected and ensure coordination/cooperation for the balance of the contract term.
Project Controls (Time, Cost, Quality & Safety)
Exponent will review and evaluate the status of project controls being deployed by the Principal on the distressed project during its initial 24-72 hour Project Triage. We will perform a “gap analysis” and cover any technical, procedural or administrative deficiencies that may exist, and be certain that the balance of the project has a “contract specific” set of project controls that adhere to the professional CM Standards of Practice as published by the Construction Management Association of America (CMAA).
Completion Contracting Services
Pursuant to Exponent’s 24-72 Hour Project Triage and subsequent evaluation of the distressed project, we will make recommendations to the surety that may include the need to bring on a separate contractor to complete the contractual obligations of the Principal. This is a recommendation that is not taken lightly. However, if a determination is made that the Principal’s operations and project team are not capable of ramping up to the task at hand, Exponent will coordinate the solicitation of a suitable completion contractor and manage the project to a successful conclusion, in the best interests of the surety and the Obligee.
REA Preparation and Expert Testimony
During its initial contract assessment and throughout the completion of the distressed project, Exponent’s PM/CM professionals will keep a keen eye focused on elements of the scope of the work that may have merit to be included in a Request for Equitable Adjustment (REA) to be presented to the Obligee prior to, or simultaneous with the conclusion of the project. Often times in these distressed project scenarios, these REA’s can mitigate most if not all of the losses incurred, and greatly reduce the overall costs of the surety’s involvement.