The MBTA’s Green Line Extension project axed its contractors after an independent study by Berkley Research Group analyzed reasons for ballooning costs.
Lessons on Stopping GMP Cost Overruns for Construction Owners
• Have a budget and accept value engineering options to maintain it
• Make the Designer design to the budget in a minimum number of packages
• Identify major risks during preconstruction and mitigate them, rather than shifting them to the owner
• With a GMP, use open book cost accounting, define cost clearly in multipliers and cap markups
• Watch out for qualifications to contractor price guarantees that shift risk away from the contractor
Green line extension map