Laserfiche WebLink
ATTACHMENT B <br /> <br />Engineering Costs as a Percentage of Construction Costs <br /> <br />A longstanding rule of thumb is that for capital projects the engineering costs should be about 20 <br />percent of the construction costs. Under this rule of thumb engineering costs include <br />engineering, surveying, and construction management. <br /> <br />For the Engineering Division’s project teams engineering costs include public involvement, <br />surveying, engineering, construction management, landscape design, real property services, <br />specialty consultants, and material testing. Engineering costs include everything except the cost <br />of construction contracts and real property. <br /> <br />Capital projects may include any or all of the following elements that affect the cost of <br />engineering services – <br />? <br /> Public involvement <br />? <br /> Right-of-way acquisition <br />? <br /> Assessments <br />? <br /> Federal funds <br />? <br /> Environmental documentation <br />? <br /> Specialty consultants such as geotechnical or structural engineers <br />? <br /> Materials testing <br />? <br /> Local, state and federal permits <br />In reviewing the pavement preservation projects completed in 2008 the engineering costs as a <br />percentage of construction costs ranged from 17 percent to 19 percent. Because of the similarity <br />of the engineering work required from project to project it is possible to compare engineering <br />costs for different pavement preservation projects. However, for the Crest Drive project the <br />engineering costs are estimated at slightly less than 50 percent of the construction costs. This <br />project was unique in its level of public involvement and the engineering costs cannot be <br />reasonably compared to other projects. <br /> <br />Two recent projects, the Courthouse District Transportation Improvements and the Delta Ponds <br />Bike Path and Bridge were primarily designed by private consultants. Both of these projects <br />included all of the elements listed above that added significantly to the complexity and cost of <br />engineering as a percent of construction cost. For both of these projects the engineering costs as <br />a percentage of construction costs exceeded 40 percent. <br /> <br />Conclusion <br /> <br />Comparing the professional services rates for the City’s project teams to the private sector is a <br />reasonable indicator of the cost efficiency of City staff providing the engineering services needed <br />to implement the City’s capital improvement program. Using this measure the City’s <br />professional services rates have historically been 15 percent less than the private sector. <br /> <br />Engineering costs as a percentage of construction costs is a valuable indicator in comparing <br />engineering costs for similar projects whether the engineering services are provided by the <br />Engineering Division project teams or the private sector. Because of the large number of <br />variables that affect engineering costs, this is not a good indicator of the cost efficiency of the <br />Engineering Division’s project team compared to the private sector. <br />2 <br /> <br />