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This will outline the history of changes and provide <br />the team with an up-to-date financial status at all <br />times. Our budget tracking system will provide the <br />City with not only a snapshot of the financials of the <br />entire project, but also a detailed itemization of every <br />cost related to the project. <br />VALUE ENGINEERING <br />Value engineering is one of the most misrepresented <br />and incorrectly performed activities in the design <br />phase. Value engineering does not compromise the <br />design solution, cost-cutting and scope reduction do <br />The goal of value engineering is to develop the best <br />return on the investment and still achieve the goals <br />that were set out to accomplish from the beginning. <br />It has been our experience that significant savings <br />can be achieved by properly implementing a value <br />engineering process. <br />When it is conducted correctly, the results <br />of value engineering are cost effective <br />solutions that meet the owner's <br />expectations of quality, function <br />and budget. In addition, the owner/users <br />gain significant insights into the options <br />which are available in the marketplace. <br />Every system from the structure, mechanical <br />and electrical systems to the building envelope <br />and interior finishes, should be included in this <br />assessment. Our value engineering process starts <br />at the design phase and continues through project <br />completion. To be the most effective, we recommend <br />that the first value -engineering session be held <br />during the schematic design phase when preliminary <br />system evaluations are being made. <br />Terra's cost work plan for this project will include a <br />complete material list with the identified quantities <br />for construction and associated costs. This will be <br />presented at the estimate/budget review meetings <br />with the City of Elk River and the design team. <br />This will allow the entire team to see what the "big <br />ticket" items are. This tool is useful if the project is <br />coming in over budget in the design phase and allows <br />individual specified items to be exposed from a cost <br />standpoint. In addition to this, each specified item <br />will have a "life expectancy' which will highlight the <br />number of years that specific product is expected to <br />last before it will need to be replaced. Once all of this <br />information is presented, then real decisions can be <br />made with full consideration of life cycle costs. <br />MECHANICAL AND ELECTRICAL <br />COST MANAGEMENT <br />Terra has in-house staff that works directly with the <br />mechanical and electrical subconsultants during <br />design to ensure the project stays within the budget <br />established for the MEP scope. The MEP budgets <br />developed are from: <br />• Historical information from past projects <br />• Current market pricing obtained by Terra <br />for the MEP scope at all stages of design <br />(SD, DID and CD) <br />Additionally, during construction this same staff <br />will continue to work with the selected MEP <br />subcontractors to evaluate any changes that occur <br />along the way. Cost management of the MEP scope <br />is one of the most critical components of design <br />development and construction administration <br />because it is generally the largest scope of the <br />project. <br />Ilk <br />.� �rMW <br />�- <br />VIM mananll m� <br />1 -ke <br />26 CITY OF ELK RIVER I Elk River Public Safety Building Expansion and Elk River Fire Station #3 <br />