Projects

Joint Venture

A business arrangement of two or more firms that agree to form a new entity for a specific business purpose. The parties to the joint venture manage the enterprise - sharing all profits, losses, expenses, and assets - and have joint-and-several liability to the owner....

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Liquidated Damages

Compensation paid by a design-builder or CMAR firm to an owner, in lieu of all liability for any extra costs, losses, expenses, claims and penalties.

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Loss Control

The act of taking measures to minimize the extent of damage resulting from an adverse event. Collaborative delivery contracts spell out, for each foreseeable adverse event, which party can most efficiently be responsible for taking loss-control measures.

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Loss Prevention

The act of taking measures to prevent or reduce the likelihood of adverse events. Collaborative delivery contracts spell out, for each foreseeable adverse event, which party can most efficiently be responsible for taking loss-control measures.

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Materials Cost Escalation

Unforeseen increases in the cost of materials, which can be an issue, particularly in contracts that span several years. The materials escalation clause in a collaborative delivery contract may be premised on agreed-to cost components in the fixed price or GMP.

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Owner Advisor (OA)

An individual or firm retained to provide technical and management resources to an owner and to serve as its representative and advisor during procurement, contracting, and/or management of a project.

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Owner-Directed Changes

Changes within the scope of work that an owner is contractually entitled to request. Owner-directed changes may result in additional compensation owed to the design-builder or CMAR firm.

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Performance-Based Requirements

Criteria in an RFP or FPDB procurement that focus on measurable plant-performance criteria and operational objectives, rather than on specific details. These criteria include technical requirements, standard construction specifications, and minimum quality standards....

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Plant-Performance Warranty

An element in the contract between the design-builder and the owner that requires the firm to demonstrate that the project will operate as intended, consistent with the technical and operational criteria and project design. If the project does not meet the defined...

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Prescriptive Requirements

Specific details within an RFP (typically in FPDB procurement) that may include design drawings and/or a description of specific design approaches. Proposing firms may be required to include their own designs - depending on the requirements stated in the RFP - in...

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