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The Construction of the Golf Course at Giants Ridge - Part 8
November was a time of high drama. Results too close to call. Ever-changing tabulations. Possible protests or legal challenges. And the results hanging in doubt for nearly a month until some decisive action was taken by an outside agency.
No, I'm not talking about the Florida Presidential election, I'm talking about the bidding - and as it turns out - re-bidding of The Quarry Course at Giants Ridge.
I told you a few months back that I would give you the bid results for The Quarry, and in the last installment you saw pictures of clearing beginning. Astute readers know that, since construction has started, the project must have been let out for bid. But the story had a few twists and turns.
When originally put out for bid late last August, things seemed to be going well. We held a pre-bid conference on site, and walked the entire property with approximately nine contractors. As is our custom, we carefully pre-qualified these builders before allowing them to bid. A decade ago, any public agency job would be open to virtually any bidder, regardless of experience. Private owners would typically invite a limited list of bidders, each of whom they were comfortable working with, to reduce hassle and ensure the results they wanted.
However, in the last 10 years, most city, state and public entities have developed a hybrid method. While state laws strongly require open bids, they also realize that entrusting $5 million or more (sometimes just because golf course construction doesn't seem as "real" as brick and mortar) to an inexperienced contractor, is not the best use of taxpayers' dollars.
In response, we have developed a hybrid method of pre-qualifying bidders. There are many ways we allow a bidder to pre-qualify, but usually you must have a minimum number of courses - say three in the last five years - to qualify; must have successfully completed two courses with our company; or be a certified member of the Golf Course Builders Association of America (GCBAA), which in effect does the pre-screening for us, regardless of our familiarity with a particular company.
This method has worked quite well as we get a broad range of bidders, which tends to drive prices down while maintaining an expectation of quality from the various contractors. Of course, like any golf course architect, my preference has always been to work with a contractor with previous experience in our work. Every architect has his own particular quirks, and a contractor who has done several projects with you takes care of those with the least amount of hassle.
Our biggest concern was a Southern contractor who asked, "Does it snow here?" at a pre-bid 100 miles south of the Canadian border. The owner's representative naturally wondered if he understood the weather conditions he was going to be working in if he was the successful bidder!
The other point we stressed at the pre-bid conference was the nature of the union labor situation in northern Minnesota. While state law does not require state jobs to use union labor, they do require prevailing wage. It is customary in this area, and in the past has led to labor troubles. It was a factor we tried to warn all out-of-state bidders about - going so far as to give them the number to the local union offices.
Bids were received on October 26 in Minneapolis. This is always a tense time for an architect. We had prepared an estimate of approximately $5.3 million, plus a special bid for lake-bank mitigation which we felt would cost more than $300,000, for a total cost estimate of $5.6 million. The benchmark for success is twofold: 1) to have the low bid come in under, at, or no more than 10 percent over the architect's estimate; and 2) to have the low three bids within 5 percent of each other, indicating that the plans were clear in their intent and that all bidders had similar expectation about the nature of the work.
Six bids were submitted, and naturally the highest of all bids was read first - which was way over the estimate and certainly caused hearts to start pumping a bit harder. In the end, we were pleased as the low bid came in at just under $5.5 million, just under our estimate. The second bid was $5.4 million and the third bid $5.9 million. The next three bids all exceeded $6 million.
All in all, we were initially happy with the results. Then we retired to a conference room to study the bids further, as is customary. The low bidder turned out to have a few technical errors in his bid. Specifically, his bid bond (an insurance policy guaranteeing the contractor will sign a contract for that price) did not meet the technical requirements of state law. The state is very strict in rejecting bids with small technical requirements such as this.
The second low bid was a Minnesota company with whom we had never worked but had received strong references about its ability. Since he had a cell phone, we called him back as the apparent low bidder so we could begin discussions. In discussions, we were concerned that this bidder did not factor in the cost of union labor. Additionally, we found one math error in his bid that technically would throw the bid out, even though a private owner would use most favorable math in determining the contract amount, telling the bidder to take it or leave it.
We had some question whether the next bidder technically met the requirements of the pre-qualification statement, and there was talk among other bidders that a protest would be filed. The problems didn't stop there. One mechanism we use to get bids within the owner's budget is to provide for alternate bids in addition to the base bid listed above. In this case, we provided 12 alternate bids - all of the deducts from the contract price for changing a certain specification, reducing a work quantity, etc.
Even had we thrown out the top three bidders - each of whom felt they had a legitimate claim to the project - our problems didn't stop. The next three bidders each could have been awarded the project, depending on how many of the deductive alternates we took to get beneath the owner's budget. The fourth bidder was low up until the seventh alternate deduct price, when the fifth bidder popped in with a large deduct to come in with a lower price.
Now the IRRRB, a state agency in charge of economic development of the Iron Range Region in Minnesota, had a problem: It had six of seven potential bidders with a potentially legitimate claim to the project, and some of them might possibly be using non-union forces, which might lead to project strikes, pickets, etc. None of these events would be good publicity for the project (although we did consider the old P.T. Barnum cliché that "any publicity is good publicity"!
The IRRRB went to the state Attorney General's Office, asking for a special exemption to the state's bidding requirements that a local union contract be signed. The golf course revenues were to be used to repay state-issued bonds, and opening the project on time was a fiscal necessity.
Re-bidding the Project
Complicating matters, this spring, at just about the start of major construction, local unions are due for a new agreement, which might potentially raise wages. The Attorney General made a special exception and we decided to re-bid the project with the union clause to avoid any confusion whatsoever. At the same time, by studying the bids we were able to eliminate the deductive alternate bids and make a pretty good guess which needed to be incorporated to get the product we desired within the owner's budget.
Each of the six contractors displayed amazing professionalism in sharing the items of uncertainty. (As I mentioned, architects like to work with contractors who know what they want; the same is true with contractors.) Each was uncertain about one or two small areas of the specifications, which they believed if cleared up satisfactorily might allow them to lower their bid. We redid the final plans, making some minor changes to the design - mostly clarifying the unclear specifications. The most amazing change - one beyond my technical experience - was changing the screening spec for small rock in the topsoil from .5 inch to .75 inch - saving over $200,000 by one contractor's bid!
The project was re-bid October 27, and only three bids were submitted. Many of the higher bidders apparently felt they could not overcome the cost advantage of the lowest three bidders. Another dropped out due to the union labor classification because he was not a union contractor. In the end, the prices did come down dramatically and Park Construction of Minneapolis - the builder of the first Giants Ridge course - jumped from fourth place in the original bid to first. He had to change a few sub-contractors and re-negotiate with others, and lower his profit margin, but in the end eked out a victory of a low bid of $5,031,000. And all bids were within $159,486 of each other. Finally, success the second time around.
Park Construction, having confidence in us and the IRRRB, and having worked with us before, immediately began moving machinery onto the site even without a signed contract in hand. This allowed them to complete most of the bulk clearing before the ground froze before Christmas and to give them a big "leg-up" on construction this spring.
Next Up . . .
We have previously discussed the routing and clearing that has just taken place, and clearly there will be no construction to discuss in the next few months. Instead, for the next installment in Cybergolf's Architect's Corner I will use the opportunity to explore the philosophy behind the feature design to give you a peek into the architect's mind as he crafts the golf course.
Jeffrey D. Brauer and his firm, GolfScapes, have designed 40 golf courses and remodeled 80. Canterberry Golf Course in Parker, Colo., and Giants Ridge are rated among the best affordable public courses in the United States, while his Avocet Course at Wild Wing Plantation in Myrtle Beach, S.C., was a Golf Digest best new course winner, Champions Country Club is rated 5th in Nebraska and TangleRidge Golf Club is 12th in Texas. President of the American Society of Golf Course Architects during its 50th anniversary year in 1995-96, Brauer also designed Colbert Hills Golf Club at Kansas State, which opened in June 2000 as the cornerstone golf course for The First Tee program as well as the first collaboration between the PGA of America and Golf Course Superintendents Association of America.