Resident Engineer Panel Discussion Jack Stone, P.E. District 2 Engineer, Casper Chad Aagard, P.E. District 2 Engineer, Casper Pete Hallsten, P.E. District 3 Engineer, Pinedale

 Preliminary Claim Avoidance ◦ Plans and Specification Development ◦ Pre-bid ◦ Review Bid Tabulations ◦ Review Construction Schedules  Claim Avoidance During Construction ◦ Pre-104

 Plans and Specification Development ◦ Plans and Specs - Clear and Concise  Are the plans and specs complete  Review the project as a complete package (not always possible)  Manna From Heaven  Will the Contractor have the same information we have?  Soils Profile, Borrow Drill Logs, etc.  Is the work to be performed clearly described  Details vs. Standard Plans  Standard Plans References  e.g., traffic control signing at interchanges  Special Provisions vs. Supplementary Specs vs. Standard Specs  Have a clear understanding of document hierarchy and which form of the spec is appropriate.  Read and understand Specials and Specs (HDPE Pipe)  Are specials and/or specs consistent with plans and summaries/quantities?

 Plans and Specification Development ◦ Plans and Specs - Clear and Concise  Are the appropriate payment mechanisms in place  Are the correct bid items and method of measurement being used (CY vs TON)  Incidental Work .5.2 – Reference Sections for Direct Payment  e.g., Pipe replacements and removal of existing pipe  Minimize risk  Are we placing unnecessary responsibility/risk on the contractor? ◦ Ambiguity  Are there conflicting specs, notes, etc.  Is the intent clear.

 Plans and Specification Development ◦ Summaries and Quantity Checks  Are the summaries clear?  Are quantities accurate. (Splices)  Take the time to perform quantity checks  Start Early  Have corrections made to the plans  Late changes can be made ◦ Constructability and Contract Time  Review the project as a complete package  How would you build it – Develop a rudimentary construction sequence  Identify restrictions or other stumbling blocks that could effect time  Is there sufficient contract time  Are there seasonal or weather limitations that could extend contract time  Chip seals, landscaping planting times

 Plans and Specification Development ◦ Construction Requirements  Restrictions – Environmental, Wildlife, Local Holidays or Events, etc.  Coordination Clauses – Utilities, landowners, etc.  Windows, Partial Completion Dates  Are they necessary? – Are they achievable? (Bonus for nothing?)  Liquidated Damages & Incentives  Are they aligned with project intent?  Are amounts appropriate?  What is the desired result?  Creating scheduling conflicts  Sequence of Work  Is a specific sequence necessary  Typically removes flexibility  K.I.S.S. -

 Pre-Bid ◦ Plan Job Showing  Create notes to ensure uniformity and accurate representation of the contract documents.  Stick to the contract documents  Do not speculate or offer opinions  Preserve the bidding process  Ensure each bidder has the same information  Know the documents that are available to the bidders ◦ Take note of what prospective bidders are saying/asking  May lead to an error or lack of clarity in the contract documents.  Evaluate issues to determine course of action  Have an addendum issued if necessary

 Review Bid Tabulations ◦ Compare line item unit costs for all bidders  Unusually high (or low) units costs can be a red flag  Investigate those unit costs that seem out of line  Review Construction Schedules ◦ Watch for accelerated schedules ◦ Do durations seem reasonable ◦ Get updated schedules as work progresses per  Compare schedules and evaluate changes to the time line - critical path, durations, etc.

 Pre-104 ◦ Listen and Observe - Early Recognition  Listen! – Contractors will often tip you off when there is a potential problem – sometimes before it becomes a problem  Observe the contractors operations and take note of work activities they are struggling with.  Be proactive – initiate conversation with the contractor ◦ Know your Contractor

Communicate - Communicate - Communicate We probably spend to much time talking and not enough listening. (State Wide Rumble Strip)

 Starts at the Preconstruction Conference.  Voluntary Partnering  The department seeks to encourage a cooperative partnership with the contractor and its principal subcontractors and suppliers. This partnership should draw on the strengths of each organization to identify and achieve mutual goals. Its objectives are effective and efficient contract performance.  Partnering was the buzz word of the day not so long ago.  An attitude that WYDOT and the Contractor have different roles in completing the same job – that it works better to work together than to fight.  Schedule reviews / Contract requirements.  Timing on working a borrow.  Meeting windows.  Clear about your expectations.  Last job had great ride, bad line.

 Visit the project often, build and maintain a relationship.  RE solves problems on the project, but can also avoid problems.  Don’t get to always see the good times.  A lot of small issues are solved without change orders or very small ones. (Spend a Little to save a lot).  Water coming through plant mix after milling. (Soft Spots)  Own the Relationship.  Coffee  Ed Steelman  Say good job. Point out things that are going well, acknowledge tough situations.  Structured Weekly Meetings. (Urban Jobs)

 Be approachable when it comes to problems.  Project staffing is decreasing / cannot see everything.  Be seen as part of the solution and not part of the problem.

 Identify and deal with issues as early as possible.  Time can make a minor issue a major problem.  Demand repair work before it becomes a reject.  Soft spot.  Rebar before concrete is placed.  Powder River Service Road Crushed Base.  PMP gradation changes.  Directing vs. inspecting  Sometimes a slippery slope  Wetting silica deck  Sledge hammers  Inexperienced contractors

 If your having a hard time coming to terms… Communicate  Make sure you understand each others point of view.  May find where you disagree and maybe something can be done.  You will be in a much better position to defend WYDOT in a dispute.  You may not agree, but try to eliminate the fuzzy bit.

 Contract Amendments  ¶1WYDOT has the right to amend the contract at any time.  ¶2 The department will consider requests from the contractor if Contractor Notification is followed.

 The Resident takes ownership of Department initiated contract amendments. (Storm Sewer)  They can come from:  any one in the department (with authority, or I agree)  the contractor if I agree with the need and entitlement.

 What does ownership look like.  Make sure all issues are addressed.  Meet with the contractor on the project to discuss the need, how it will be done, available materials, what pay items will be used, including the use of existing pay items, impacts to schedule, affected subcontractor and how I plan to move forward.  Gather information and seek guidance/concurrence from District Staff, Maintenance Foreman, possibly Bridge, Geology, Materials and FHWA if applicable.  Follow up with verbally or in a letter stating reason for the amendment, pay items affected, new estimated quantities, request for prices, reminder to address subcontractors, traffic control and time.

 Contractor’s reply will be exhibit for change order.  Evaluate prices in accordance with Section Extra and Force Account work which gives the hierarchy for preference of payment. 1) Contract Unit Prices (if representative / No significant changes in the character of the work) A.Overrun or document increased quantity in E-61. 2) Negotiated Prices (contract unit prices are not representative or item not in the contract) agreed to by WYDOT and the Contractor. A.The Engineer signs a statement that the prices have been reviewed and found reasonable. a)If I do not feel I can ethically sign that statement, spend some time with the contractor trying to reconcile the differences. (6 mile rd gravel) (Spur Water Line).

3) Force Account/ time (We often forget this option but it brings everyone to the table in good faith.) Prices should not be a reason for a claim. Contractor doesn’t feel in covers cost. WYDOT has to worry about production rates. Both hate the paper work.

 The spirit of section Contractor-Engineer Notification.  Identify issue early.  Who ever identifies the issue, Contractor or WYDOT, needs to notify the other party early. (WYDOT is entitled to agree and to a mitigate issues).  Resolve the issue quickly at the lowest possible level of authority.  Once an issue has been identified, both parties need to respectfully seek resolution in good faith.  Pay the contractor a fair price for the work/allow adequate time.  Don’t take advantage of WYDOT because something was missed in the contract.  If the issue cannot be resolved at that level, escalate the issue the next level.  A way for WYDOT to escalate a dispute( The department will not consider any condition at an available source or local materials whether furnished by the department or the contractor, as meeting the requirements of Subsections Differing Site Conditions, or Significant Changes in the Character of Work.)

 What is First Notice, by Contractor  Any perceived indication the contractor feels an issue exists.  Follow up to get to the bottom of the issue even small ones.  If I at any point I come to agree, I would take ownership.  If I disagree that a contract amendment is needed, I would continue to seek resolution through verbal and written communication both with contractor and others in WYDOT, so long as we were productive in seeking resolution.

 Either WYDOT or the contractor can use Contractor Notification to escalate an issue in order to get it resolved. If I feel it is necessary to escalate the issue I will use it.  This is headed to a claim, it does not mean the RE has failed and now the DE or Chief Engineer needs to step in and save the day.  There are some things Resident Engineers cannot do to resolve a dispute.

 If you do not agree the following were met (Entitlement), the RE cannot resolve the issue except to convince the contractor he is not entitled.  Differing Site Conditions  Engineer-Ordered Suspensions  Significant Changes in the Character of Work  There are many things in the contract the RE responsible to enforce that can go to dispute.  Monetary Damages related to quality assessment, or time.  Warranty work (2 week on chip seal, plants for city).  Removal or corrective work related to quality.  Contractor does not agree to WYDOT definition of quality or seeks to limit monetary damages.  I would also use Contractor Notification as grounds to deny a claim if the work associated with an issue was completed and afterwards the contractor sought compensation.  WYDOT was not given opportunity to agree an issue existed or to try and mitigate it.

 In order to get to the Chief Engineer’s decision it will take about 7 months so make sure you have done all you could to solve the issue within your authority. If you don’t, you will wish you had by the time this is done.  It is your job to take care of issues on your projects.  Solving the issue, if you can, is easier than going through the claim process. (Lowest level is easiest, best and most satisfying)  Greater effort here will make your defense stronger. (Answer the hard questions now so they don’t surprise you in front of the DE or Chief Engineer.)  District 3 has meeting/negotiation with RE/DCE/Contractor.

 This is headed to a claim, so Document / Document / Document  I would get out the spec book and follow Contractor Notification to the T, including time frames. (Written Acknowledgement, 10 working day response.)  Don’t be a stingy in agreeing time extensions while remembering that drawing out this process is not solving the issue. (Avoid Pettiness)  Letters should include the contractors next step, the time frame and possibly what the information being provided will be used for. (Push for all info.)  From here on the letter “RE:”  Copy the contract language. (Formal)  Stick to Facts & Site Contract  Don’t be provocative.  Sincerely vs. Respectfully  Give their argument better than they do.  Work closely with your DCE

 To escalate the issue and as documentation, I would write a letter directing the contractor to comply with Written Notice, by Contractor within 5 days.  I start the claim package in a 3 ring binder as soon as I think it might head to a claim.  While I don’t expect the contractor to make the WYDOT case, I don’t think that the Resident Engineer should have to make the contractors case. (Don’t say what they want, Why it is due, E-61 headings)  That is why I start a 3 ring note book early, to ensure I get all of the WYDOT information in the “claim package”.  It is easier to do at the time than try and remember later.  You will have the chance to insert your information into the claim package when you render your decisions. (It is the basis of you decision.)

 At this point, it is too late to start documenting. Have good documentation practices in place.  Diaries, appropriate letters, pictures and video need to be taking place throughout. (chip seal video)  Someone is going to second guess your documentation, want more.  (Knowledge at the time.)  EDS diaries are shorter – Pete still uses paper for this reason.  The three ring binder gives you a good idea of where you are, so you may be able to shore up the case. It is better to have good documentation practices happening all along. You never know.

 Section Where you go if you disagree on either three elements entitlement, impacts or costs  Begins with the contractors notice 5 working days after the resident engineers decision. ◦ From this point all correspondence sent certified return receipt

 Wydot documentation ◦ Create a file at notice or before - Start of claim manual ◦ Documentation is vital, have good practices in place from the beginning.  Regular and complete diaries, letters, photos, videos  Pay documentation  T-109s, E-78s, grading reports ◦ Other resources  Trauner manual  DCE, Construction staff

 Section ◦ The Claim Package  List of supporting documentation  Certification  Basis for entitlement stated and supported  May have evolved over time  Correspondence- 5 day letter  Pictures  Diaries, time cards

 Section ◦ The Claim Package  Impacts stated and supported  Schedules, analysis  Costs/ time extension stated and supported tied to impacts  Bid calculations  Actual costs and supporting documentation  Ask for what you need if it is not provided - certified letter  Restart 30 days  Get explanations of documents you don’t understand  Bid calculations, accounting records

 Analysis ◦ Focus on the three elements  Entitlement –Impact-Cost  All three elements at this stage

 Analysis ◦ Entitlement  Contract based evaluation  Is it a change from the bidding condition?  differing site conditions  Latent conditions  Unusual unknown conditions

 Analysis ◦ Entitlement  Significant changes in the character of the work  Change in character (Grading)  Changes in quantity  Engineer ordered suspensions  Contract provisions  LQDs, Quality assurance assessments  Warranty work(2 weeks on chip seal, plants for city)  Remove and replace quality issues

 Impacts ◦ Where the contractor often falls short ◦ Delays, inefficiencies, acceleration, change method and means

◦ Change in method and means ◦ Delays  Critical path and noncritical path  Non-excusable  Excusable  Compensable-related to a change  Non- compensable - Force majeure  Trauner Manual  Schedule analysis  As constructed schedule vs as-planned schedule  Production analysis(measured mile)

Excusable Non compensable delay

 Costs ◦ Should be straight forward if the other two elements are done properly ◦ Costs tied to impacts  Actual costs  Force account ◦ Profit - not allowed for claims ◦ Overhead  Job overhead ok  Home office overhead - No

 Costs ◦ Bid price calculation and production estimates  Don’t just get the one item  Mobilization ◦ Are there mitigating impacts to costs  What is in the unit price  Fixed cost  Direct cost  Job OH  Labor

 Costs ◦ Contractors source documents  Labor records if there are labor cost involved  Time cards  Payrolls  Production records (crushing) What, when and how much

 Costs(cont) ◦ Contractors source documents  Accounting records  OH rate  Home office- Not usually recoverable  Job overhead  Equipment bare rates  canceled checks  Equipment costs  Rental agreements  Material costs  Purchase orders

 The Letter – last chance ◦ Certified return receipt ◦ Entitlement impacts and costs ◦ Thorough, but don’t get lost in the minutia ◦ Analysis, charts and graphs ◦ A fair tone - strict but fair  Contractor has 30 days from receipt to respond

 Appeal to the District Engineer ◦ The claim manual  Brief history/executive summary  Completion report  Correspondence  Numbered and tabbed, oldest is #1, appeal to the District Engineer last  Diaries -tabbed  Analysis  Charts and graphs and source documents  Schedules  Pictures  The contractors claim package

 Presenting to the District Engineer ◦ Agenda  General overview of the project and claim - RE  Presentation of the contractors claim - Contractor  Questions for the contractor - District engineer  Analysis of the claim and Basis for decision – RE  Questions for the RE – District Engineer  Discussion

 Preparation  Organize logically, like your letter  Visual aids  Power point  Know what their arguments will be  Be prepared for theatrics, be composed ◦ Show you did your best to consider their arguments  From this point on you are just the keeper of the claim manual  Appeal to the Chief engineer ◦ Wear a tie

 I had one project go to Court Ordered Arbitration.  My general impressions.  The AG’s office will help you through, but it will be unfamiliar.  You are no longer in charge of the time line. It is going to take a long time. (Frustrating)  You will hear nothing for long periods of time. When suddenly at your busiest time you have to provide a very large amount of specific information and thoughts in a short amount of time with a perjury statement attached to it to add to the pressure. Then nothing…  I would consider having all information ready to send when asked.  Depositions are well thought out ahead of time by the opposing lawyers, they will not follow a train of thought, they will circle back and are designed to keep you off guard.  Take serious the AG’s advice to only answer the question ask. If yes will do, answer yes. (Answer the question, Miranda rights-don’t answer questions not asked).

Cartoon credit to Dave Kaufman