Impact of Weather Events on Construction Projects and How to Prepare – June 2015.
We are raised to plan for rainy days in our personal lives. Keep an umbrella in the car, allow extra time to travel, clean the gutters. We do the same on our construction projects…right?
The extensive rainfall the central United States has experienced recently underscores the importance of treating weather impacts on our construction projects with due deference, as it can profoundly affect our schedules, productivity and costs. Weather events, such as those seen recently, can quickly turn a profitable, successful project into a loss.
“Surely, as the contractor, I can’t be expected to bear the impact of such an unseasonable weather event, correct?” “Clearly, as an owner, it’s not my responsibility to deal with means and methods for mitigation, right?” As with most things, the answer is not a clear yes or no. It depends on the preparations made prior to the event and measures taken during the event as well as the post event actions.
Preparing for the Storm
The impact of unforeseen conditions such as weather events depends on how it is incorporated into the project during the planning phase. The process outlined prior to the start of a project for such events will dictate the methods and tools available once it incurred.
A critical component is to establish the amount of weather impact that is “normal” for the time period and location of the project, and how many weather days are foreseeable throughout the duration of the project. However, this is not an exact science, and can be a major area of fundamental disagreement between parties after the event has occurred.
It is best to establish a relevant reference (i.e. almanac, National Oceanic and Atmospheric Administration (NOAA) records, local news agency, etc.) that will correlate most closely to the actual conditions and ensure all parties agree upon it at the inception of the project when it is not in controversy as it will be less contentious and more easily agreed upon. This may be stipulated in the contract or specifications by the owner or in an assumption, condition or baseline schedule narrative by the contractor.
While contractual provisions may identify how to communicate or document this type of weather delay, understanding what should have been reasonably anticipated may be a challenge. Further, proving and quantifying impacts resulting from an unforeseen condition can be difficult, so incorporating a reasonable amount of weather impacts during the planning stage is essential.
Ask your team the following questions:
- Are the weather impact durations substantiated by contract, assumptions in the bid, reference documents or other pre-established quantum?
- Did the contractor prepare a detailed baseline schedule for the project? Does it include distinct, logic-tied weather activities representing the amount of time anticipated separate?
- Are the weather activities explicit as to time period and separate from float? Do they correlate to wet seasons for the region based on historical data?
- Is there an agenda item during the project meetings that addresses weather? Does the team track weather days on an ongoing basis?
- Is the project site located in a relevant area to a NOAA monitoring site for recordkeeping purposes, or is there a micro-climate that may warrant a site-specific weather station(s)?
- Has the owner reviewed and accepted the baseline schedule? Have the subcontractors bought in?
- Are periodic schedule updates maintained that show consumption of weather days and/or impacts to connected activities?
- Have best management practices (BMP) such as canopies, shrink wrapping, dewatering, shoring, storm water pollution prevention plans (SWPPP) measures, dry-in work sequencing prioritization or other efforts been considered that can make the project more weather resilient?
If the answers to the above questions are in the affirmative, then the team is well on its way to being prepared to mitigate the impact of weather events on the project schedule and budget. If not, it may be time to revisit the priorities of the team with regard to preparation.
In the Eye of the Storm
Amid the impact of the weather event, there are a number of actions that will assist in tracking and mitigating negative consequences in cost and time. In addition to the standard SWPPP monitoring and measures, the team should document on-site rainfall, photograph or video site conditions and the functioning of storm water management BMPs, take protection measures for work in place, materials and equipment stored on site, and keep detailed daily reports on planned versus actual production during these periods. This impact should include observation and documentation of any dry-out period required for work to commence. Critical path work should be identified and evaluated for ways in which protections can allow continuance.
In the Wake of the Storm
At the conclusion of the weather event, the team should determine if any actual damage resulted from the unforeseen condition by quantifying schedule, cost and productivity impacts.
In order to substantiate a case for a contract modification, the party must be able to prove that the conditions that occurred were not reasonably foreseeable for the project site during the specific time period, and that the progress of the project was impacted as a result of the event, particularly with regard to critical path activities.
As is apparent, the practices outlined above are geared to generate the data and documentation to evaluate the impact against this test, and in turn demonstrate any actual impact for purposes of contractual modifications.
Dollars or Days
If the evaluation determines critical path activities were impacted as a result of the abnormal and unforeseeable condition, the team should consider seeking a contract modification in order to adjust for the unexpected change to the execution of the project.
In most cases, such weather delays will warrant a time only, or excusable delay, extension of the substantial completion date of the project. This extension will not compensate costs incurred for productivity loss, extended direct and indirect overhead, dewatering or mitigation measures, or other unplanned expenses due to weather delays.
There are circumstances that may lead to a weather delay moving from excusable to compensable, which includes both a time extension and monetary compensation for the delay. This will be based upon any owner involvement in the delay beyond the weather event itself. An example that illustrates the importance of some of the preparation measures above could result from a prior or concurrent owner caused delay in the project. Consider a case where the owner has agreed to furnish equipment to be installed (OFCI), but procurement was delayed four (4) months which stalled installation by the contractor. The delay pushes the installation activity from summer/fall to fall/winter, which is the height of the rainy season. As such, the experienced delay due to weather may have been avoided but for the owner caused delay in OFCI procurement, and a case may be made that the delay should not only be excusable but compensable as well.
While this is a case-specific, fact-driven evaluation, it demonstrates that without the foundation of the documentation, data and communication above, it will be a difficult if not impossible argument to make. For example, if there is no baseline schedule, how can the timing of the intended activity be verified? How would the owner know that the delay might affect the installation activity in such a way?
Control the Impact, Not the Weather
While we will never be able to control or definitively predict the weather itself, we must address it as a real and profound risk on our projects. By establishing the baseline impact expectations, tracking the event in real time and reacting appropriately when it occurs, the weather risk can be accounted for and mitigated. This requires us to start building the Arc well before we feel the first drops of the storm.