CCP 01132025 - Laserfiche WebLink

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Attachment 4 LMC Article: 2023 Legislation Authorizing City Use of Construction Manager at Risk By James M. Strommen and Cristina A. Cruz-Jennings The 2023 Minnesota Legislature authorized municipalities governed by the Uniform Municipal Contracting Law to use the Construction Manager at Risk (“CMar”) process for 1 construction projects over $175,000.The CMar process is commonly used for private projects, 2 and state agencies have been able to use it since 2005. The CMar process places the construction manager in essentially the same position as a general contractor because the construction manager is responsible for all subcontractors and for the “price, schedule and 3 workmanship” of the project. The new law gives cities the option to use CMar in addition to the traditional CM as advisor (“CMa”) process by which a city contracts with a construction manager to coordinate the work of multiple contractors without assuming the risk of project cost overruns. In contrast to the CMa process, the construction manager selected using the CMar process guarantees construction of the project for a Guaranteed Maximum Price (“GMP”) in accordance with the agreed upon completion schedule, subject to owner-directed changes or changed conditions. The GMP consists of the construction costs, the construction manager’s fee, and the general conditions costs. The CMar process allows a city to turn over a project to a skilled construction manager who is responsible for the work performed by the contractors, which are the CMar’s subs rather than in contracts directly with the city. The CMar process usually results in less city staff involvement in the construction process and oftentimes results in fewer change orders than the CMa process. 1 Qbhf!32!pg!6: