Innovative Construction Contracting for Todd Pacific Shipyards Sediment Superfund Cleanup

Todd Pacific Shipyards (Todd) is a 28-acre facility at the northwest corner of Harbor Island in Seattle. Cleanup of contaminated sediments at Todd was required by the U.S. Environmental Protection Agency (USEPA) under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA; Superfund) Program. The project was designed and construction was managed by Floyd|Snider. Construction was performed by General Construction Company (GCC). The project work included dredging of approximately 169,000 cubic meters (220,000 cubic yards) of sediment, upland disposal of the recovered sediment, placement of sand caps below existing pier structures, and enhancement of nearshore aquatic habitat. Several components of the project were unique, including dredging and disposal of sediments with high water content, capping underneath existing pier structures, and implementation of all work within an operating shipyard. Recognition that construction would be difficult and that a conventional design/bid/build approach would be problematic led the management team to an early decision to promote a team approach for project design and construction. The cornerstone of this approach was use of a "Cost Plus Incentive Fee" contract for project construction, which successfully aligned the financial motivations of Todd and GCC and incentivized improvement of construction methods during the project. Tangible benefits included: 1) GCC was involved in shaping the final design, thereby ensuring the design was constructible and well matched to available equipment; 2) The cost contract removed financial risk from GCC, thereby reducing bid costs to cover unknown/unquantifiable risks; and 3) The sliding scale fee motivated GCC to keep costs low. Construction was completed in December 2005, 2 months ahead of schedule. The dredging was successful in achieving specified cleanup levels, returning the quality of marine sediments throughout the shipyard to pre-industrial levels. Final actual construction costs were less than the target cost, resulting in beneficial fee allocation to the contractor and an overall project cost savings for the owner.