FTA Oversight Procedures - Federal Transit Administration - U.S. ...

U.S. DOT Federal Transit Administration
TPM-20 Office of Engineering
Project Management Oversight
Oversight Procedure 33 – Capital Cost Estimate Review
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1.0 PURPOSE
The purpose of this Oversight Procedure is to describe the review, analysis and recommendation
procedures and reporting requirements expected by Federal Transit Administration (FTA) from the
Project Management Oversight Contractor (PMOC) with regard to the:
• Soundness of the Grantee’s estimating methods and processes compared with proven
professional quantity surveying and cost estimating practices for projects of this scale;
• Congruence of the project cost estimate with the project scope and schedule, i.e. do these three
elements fully reflect each other;
• Reliability of the estimate for procurements, contract bids, and contract closeout, i.e. will the
project budget prove to be adequate at these milestone events.
2.0 BACKGROUND
Congress and FTA’s good stewardship insist that a Grantee’s cost estimates be reliable. The path to
increased cost reliability is the application of sound engineering practices and professional experience and
judgment to the development of project information. At the beginning points of project phases, such as
preliminary engineering and final design, and at other points in project development, a thorough
reevaluation of the scope, schedule and cost is performed to confirm and reconfirm the cost estimate’s
reliability.
3.0 OBJECTIVES
FTA’s objective is to assess the consistency of cost estimating information, understand its characteristics
and descriptions as well as the correlation between the estimated quantities and the quantities shown on
the design or contract documents. The Grantee’s cost estimate should reflect the scope in these
documents.
The PMOC is to review and characterize the cost estimate and its supporting information. The first time
this review is performed, usually prior to entry of the project to preliminary engineering, a “baseline” is
established, i.e. a point from which future estimates are measured. Later, when contract packages are
conceived, the PMOC will evaluate the estimated costs in packages, and consider related General
Conditions of the construction contract and other elements specific to the packages. FTA may direct the
PMOC to perform this review prior to issuance of documents for bid, or during construction to assist the
Grantee in deciding whether or not to reduce scope or enact other cost control measures or mitigations.
OP 33 Capital Cost Estimate Review
Revision 0, June 2008
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