I have previously speculated that stimulus green building projects will be at risk of underbidding. Now we have real evidence. Remember the $5.5 billion that the General Services Administration received from the stimulus to fund green building construction and retrofits?
"Bids came in far lower than we expected, but the upside is that because of that, we have been able to fund more projects," said Paul Prouty, acting administrator for the General Services Administration.
You may recall that the GSA requires that all new construction projects achieve LEED certification and prefers that its projects achieve LEED Silver certification. With the fierce competition for GSA projects, you can bet that the winning bids will include LEED Silver certification promises.
Underbidding these GSA projects with promises of LEED certification is bound to lead to problems. Underbidding makes it more difficult to deal with changes to the design and construction. Underbidding makes it more difficult for contractors to deal with changes in design and construction plans:
[Paul Shaughnessy, president of BSI Constructors in St. Louis] warned that some contractors are bidding so low they could find themselves unable to cover even the slightest unexpected construction costs.
"The risky side is you're seeing some very thinly capitalized companies making low bids out of desperation," he said. "Their bids are so thin that should something go wrong, they would have very little capital to fix things."
Simply put, the stage is set for LEEDigation.
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