Design-Build Project Delivery In New York

Design-Build project delivery has gained ground recently in New York. In a sweeping budget deal last month (December 2011), including provisions restructuring the personal income tax code, New York authorized certain state agencies to utilize design-build for road, bridge and other capital projects in excess of $1.2 million. The agencies benefitting from the deal include the Department of Transportation, Office of Parks, Recreation and Historic Presentation and the Department of Environmental Conservation. Awards are to be made on a “best value” basis to bidders from a prequalified list.

The budget deal also contained provisions for the creation of an “infrastructure bank”. Legislation will be proposed to permit the New York Works Infrastructure Fund to also bid projects on a design-build basis. Initial funding of the bank is to consist of $700 million from the State representing funds intended for 2013 capital projects which will be moved up to 2012 and $300 million from the Port Authority to be used for projects in New York City. The expressed goal is to raise $1 billion from private sources such as pension funds.

One of the immediate beneficiaries of the legislation is the Tappan Zee Bridge Project on which a draft Environmental Impact Statement was just issued. That project will be the subject of a request for proposal perhaps as early as late 1st quarter 2012 and will proceed as a design-build procurement. Federal funding approval will be processed on a fast-track as the project was recently accepted as a priority project by the Obama administration.

The expansion of design-build in the 2012 budget follows an agreement on last years’ budget when the State University Construction Fund (SUCF), the City University Construction Fund (CUCF) and the Dormitory Authority of the State of New York (DASNY) were allowed to use design-build and public private partnerships on projects not to exceed 15% of their construction budget.