Multiple Primes Delivery System, Procurements and Supplements, Pittsburgh AIA

Another alternative project system is Multiple Prime Contracting, in which the Owner holds separate contracts with Contractors of various disciplines, such as general construction, mechanical, electrical and plumbing. In this system, the Owner, or its CM, manages the overall schedule and budget during the entire construction phase.

Although the Joint Committee ultimately does not recommend this delivery system, it is required for Commonwealth of Pennsylvania public projects by the Separations Act* and many Public Owners are required to use it. The system has also gained favor in part as another method to procure early “stand alone” packages to help accelerate the construction start or order long lead major equipment.

This system can theoretically result in a lower cost to the Owner because it avoids the compounded profit and overhead margins that are common to the single contract method.

The multiple contract system may also permit the Owner to divide the work into smaller packages. This may permit more firms to bid for the work and this increased competition may result in lower prices.

Work in each construction discipline is bid separately, allowing the flexibility of awarding construction contracts on the first portions of the project as soon as the respective aspect of design is completed. Furthermore, the system may allow the Owner to have more control over the project procurement schedule, since the Owner sets the schedule for bidding individual portions of the work. For example, if an initial phase of construction (such as foundation construction) is delayed, the Owner may reduce liability for delays by postponing the bidding of follow-on work. Another advantage of this system is that the Owner can realize savings by directly procuring major material items, such as structural steel or major mechanical equipment, avoiding contractor mark-ups.

With the Owner as the construction cost estimator, more time and expense may be required of it in receiving separate bids or negotiating separate contracts.
Some party has to coordinate the work of the various contractors and form the construction team. This may be done by the Owner, the Design Professional, a Construction Manager or the Contractor who is constructing the building structure.
As the construction cost estimator, the Owner must determine the cost that will be incurred in connection with the coordination work.
The lines of responsibility and accountability under Multiple Prime Contracts are less clear than a single contract system utilizing a general contractor. A Contractor who performs his work late may assert that this delay was caused by another Contractor.
When defective work is the issue, a Contractor may claim that his work was proper when he performed it, but that another Contractor’s work caused the problem.
The Owner or his Design Professional, whichever is responsible for the construction project management, must coordinate a solution to competing claims from Contractors under the Multiple Prime Contract system. Had there been only a single contract, the General Contractor would be responsible for construction management. He would be required to resolve the problems since the General Contractor is responsible for the work of his Subcontractors
Various elements required for the proper installation of materials and equipment or performance of systems may not be included in any of the separate contracts. Even with detailed scope review of each separate prime contract, missing items of work may not be uncovered until late in the construction process causing additional cost, schedule delays, and potential removal of work already in place. This coordination is the responsibility of the Owner under a Multiple Prime Contract whereas it is the responsibility of the Contractor under a Single Prime Contract.
Some General Contractors in the area will not participate in projects utilizing the multiple prime delivery system. Some General Contractors prefer to control the entire project thereby limiting risk and having to rely on the performance of another prime, especially not knowing what other major primes might be awarded contracts for the project.
Decreased collaboration may occur because the multiple primes may act in a manner that benefits their own interests instead of the best interests of the project.
Number of bidders may be limited by major trade contractors that are unable to provide performance and payment bonds for their package, but would be able to participate as a subcontractor under a General Contractor that does not require a subcontractor bond.
The multiple prime delivery method challenges the process of constructing a high performance building by making it virtually impossible to integrate the design and construction processes. This is fundamental to constructing a Green Building at a competitive price. The key principle of sustainable design, treating the building as a total functioning system, requires pre-construction collaboration between the designer and contractor; which cannot be done using the multiple prime delivery method..
The general trades contractor is often assigned responsibility for the coordination of the other prime contractors even though this entity does not have the authority to approve or disapprove the Owner’s payment to the other prime contractors. Therefore, the most effective method to coordinate the work is lost under the multiple prime delivery system.

§ 1003. Separate specifications for plumbing, heating, ventilating and electrical work; separate bids and contracts

Hereafter in the preparation of specifications for the erection, construction, and alteration of any public building, when the entire cost of such work shall exceed four thousand dollars, it shall be the duty of the architect, engineer, or other person preparing such specifications, to prepare separate specifications for the plumbing, heating, ventilating, and electrical work; and it shall be the duty of the person or persons authorized to enter into contracts for the erection, construction, or alteration of such public buildings to receive separate bids upon each of the said branches of work, and to award the contract for the same to the lowest responsible bidder for each of said branches.

Procurements & Supplements