| Dry Utilities Could Be the Problem - Issue 3 Aug 09 |
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When we build homes, roadways, bridges, waterlines or utilities lines there is always a concern for completing the project on time, within a budget and for a profit. Delays are a major reason of projects losing money. Sometimes managers don't even know why their project is delayed, but it happens. Besides the day to day operation that could delay a project and do, there are bench marks that can put a project in the red extremely fast. These seem to be obvious to most Owners, Builders and Developers, but you would be surprised. The most obvious delay at the beginning of a project is selecting the right designer and engineer for the project. They could be dragging their feet on finalizing the price or the contract. This could add months of delays to the project and not obviously felt, but to the Builder or Owner these months of carrying cost are critical in turning a profit in this down turning economy. A second obvious potential delay is selecting the right General Contractor to manage the project or specific subcontractors. These delays will be felt with the day to day operations, but could again be the target of a project losing money. A third but not so obvious delay to a project is the dry utility work. Many Owners and Builders forget about this task. This is why dry utility design and construction could be a major factor in the company turning a profit. What are dry utilities? Most projects need power and or gas to operate. Dry utilities or what some people call "joint trench" are the power and gas that supply a project. These don't only need to be installed, they need to be designed. The design must also go through a utility company, e.g. PG &E for final approvals. Power and gas are needed on road and bridge projects, but this potential delay is felt the most in the home building industry. Remember. You will not occupy a home without electrical or gas being supplied to this home. No City will ever allow final sign-offs before all public agencies have approved the design and installment of the utilities themselves. Dry utilities should be on the radar of every Owner when starting a project. Remember. You will not occupy a home without electrical or gas. The design process can be very simply, but let me run though the basic process. The Owner supplies an application to the utility company. In California, it will most likely be PG&E. The Owner can either have PG&E design the dry utilities or they can have an outside agency perform the work. Even though PG&E is an excellent organization, they have their limitations. They must support the general public. If an unexpected storm hits your area, and since PG&E must support the area, their focus is redirected to designing or installing dry utilities to support the community. Guess what? Your design is on hold until this emergency is resolved. This is why I recommend using an outside agency that can support your design needs. Sunshine Design, LLC (www.sunshinedesignllc.com) is one of the leading design professionals in the area and I highly recommend them for your design needs. Even though PG&E may not be involved with the design, they will still provide the global or as-built plans to the designer. The design approval may take multiple submittals to address all issues with the utility companies. This again is why you need to use an experience designer like Sunshine design to manage your joint trench design. Your joint trench design is approved. Now what? You are only half way complete. Your dry utilities must be inspected during construction. Guess what? The utility company gets paid for inspecting this work. They need a contract to get paid for this service. The Owner must sign this agreement and pay for these services. This is typically an area of delay to a project. Make sure your due diligence on this subject is complete to avoid this down time. Your design is completed. Your utility contract is signed and paid. Your dry utilities are approved and installed. Are we done? No. You would think we are, but there are two more critical steps in getting the gas and power to the project. You need meters. The utility company must get paid for supplying the gas and power and the meters monitor the supply. You would think this is an easy process, but ironically could be the one of the most difficult steps. Everything must be approved and paid before you can receive a meter. All contracts must be signed, all check approved and field inspections signed-off before the meters can be schedule to be installed. Did you catch the word "Schedule"? You are not the only project that needs meters. You must schedule these meter installation dates well in advance. Unfortunately, without the proper sign-offs the utility companies will not allow you to schedule the meter installation. This is where organization and proper filling of approvals becomes critical. An Owner that is lacking in organization is typically scrambling for the needed approvals and possible missing critical installation dates. Dry utilities are so critical in developing a project on time, within budgets and for a profit. You must be aware of the entire process. You must manage the process. Don't let the process manage you. It is typically to add some float days in your schedule at the beginning of the project to forecast potential delays. Your goal is to expect the potential delays outline above in my paper and manage the project to eliminate the need for these float days. Remember. Our profit margins are so small in this decreasing market that even a one week delay could determine if this project turns a profit. Please review my web page at www.RieserBuildingGroup.com for previous newsletters. Regards, Mark E. Rieser II, MS, PE President / Founder / Civil Engineer Rieser Building Group, Inc. |
