ESTIMATING STANDARDS
The Design and Construction Management department employs the Association for the Advancement of Cost Engineering (AACE) estimating standards. This reference describes five (5) levels of estimating accuracies, each level contains a different level of project detail and corresponding level of contingency. The levels range from “Order of Magnitude,” where little is known about the project, to an “Engineer Estimate” that is based upon an actual design for the project. Following the Engineers Estimate, the highest level (i.e., most detailed) of estimate (with the lowest contingency) is reached when the project bids out and a fixed fee contract is in hand. Depending upon the stage of the project, the contingency can range from +50% to as little as +10% and establishes the reasonable risk on the project.
AACE Classification of Cost Estimate Types
Characteristics | Class 5 | Class 4 | Class 3 | Class 2 | Class 1 |
Order of Magnitude | Study | Preliminary | Definitive | Detailed | |
Increasing Level of Definition -------------------------------------------> | |||||
1) Primary Characteristics | |||||
Project Definition as % of Full | 0% to 2% | 1% to 15% | 10% to 40% | 30% to 70% | 50% to 100% |
Project Definition | Little More Than Idea | Sufficiently Detailed | Further Defined | Further Defined | Highly or Fully Defined |
Synonyms | Ballpark, Seat-of- pants, Guesstimate, Ratio, Prospect Estimate, Rule-of- Thumb, Idea Study | Top-down, Screening, Pre- design, Prestudy, Factored, Feasibility, Authorization | Target Estimate, Budget, Scope, Sanction, Concept Study, Basic Engineering Phase | Engineering Estimate, Master Control, Bid, Tender, Forced Detail, Change Order | Bottoms-up, firm Price, Fair Price, Definitive, Full Detail, Tender, Bid, Change Order |
Notes | “The Level of Project Definition Determines the Estimate Class.” “Scope Definition Roughly Corresponds to the Percentage of Complete Engineering.” | ||||
2) Secondary Characteristics | |||||
Purpose or End | First Cut Screening of | Feasibility | Decision to | Decision to | Basis for Detailed |
Usage | “Ideas” | Evaluation & | Proceed, Obtain | Proceed, Obtain | Cost Control, |
Anticipated | Significant funding, | “Full” Funding, & | Procurement, or | ||
Funding | & Preliminary Cost | Basis for Cost | Firm Price Bidding | ||
Control | Control | ||||
Estimating Methodology | Conjecture, Judgment, Analogy, Factored Models | Conjecture, Judgment, Analogy, Factored Models | Semi-Detailed Unit Cost w/Assembly Level Line Items | Detailed Unit Cost w/Detailed Take-off | Detailed Unit Cost w/Detailed Take- off |
Range of Accuracy, Typically | -30% to +50% | -15% to +30% | -15% to +30% | -5% to +15% | -5% to +15% |
-Low Range | -20% to-50% | -15% to -30% | -10% to -20% | -5% to -15% | -3% to -10% |
-High Range | +30% to +100% | +20% to +50% | +10% to +30% | +5% to +20% | +3% to +15% |
BURDENS
Under LBNL/DOE guidelines the type of funding determines the burdens that will be applied to the project budget, which will affect its overall cost. If funding is unknown at the time of the estimate, then a clear, written statement must be included in the estimate stating assumptions made, burdens applied, and that changes in funding sources may change the estimated cost. If there are multiple funding options for the project the estimate should, when not cost prohibitive, reflect the differences in project costs under the different burdens. If multiple funding sources are required (capital improvements, furniture and moves, IT/telecom, and programmatic costs), these must be clarified and reflected in the estimate.
COMPLETED ESTIMATES
Cost estimates are provided to the client in writing and signed by the Facilities Design and Construction Management Project Manager. Cost estimates will clearly indicate the degree of uncertainty in the estimate (e.g., Class 1, 2, 3, 4, or 5) and list the important assumptions and/or exclusions. In cases where the project client is unable to provide a well-defined project scope, it may be appropriate to provide the client with cost and schedule duration ranges.
REFINING ESTIMATES
If a client requests a higher level of certainty cost estimate than what was originally approved in the original scoping and estimating Work Order, the client may be asked to: Furnish more details in the description of the project; Provide additional funding to support estimating and study work; and/or Agree to a reasonable due date for completing the estimate.
REVIEW ESTIMATE AT 50% AND 100% DESIGN
The Project Manager may arrange for a third-party cost estimate for larger, more complex projects at 50% and 100% design. The Project Manager or an alternative estimating resource, in-house or external to the Lab, may perform this function.
ESTIMATE PREPARATION INSTRUCTIONS
COST WORKS ESTIMATE - Example
Line Number |
Description |
Quantity |
Unit | Ext. Labor Incl O&P | Ext. Equipment Incl O&P | Ext. Material Incl O&P | Ext. Total Incl O&P |
Construction Projects Department | |||||||
Lawrence Berkeley National Lab | |||||||
Example Project | |||||||
Line Number |
Description |
Quantity |
Unit | Ext. Labor Incl O&P | Ext. Equipment Incl O&P | Ext. Material Incl O&P | Ext. Total Incl O&P |
Division 1 General Requirements | |||||||
019306200020 | Carpet cleaning, self-contained automatic extractor | 20.00 | M.S.F. | $278.85 | $238.70 | $517.55 | |
019306400380 | General cleaning, desk tops | 8.00 | Ea. | $13.86 | $0.53 | $14.39 | |
019306400760 | Vacuuming, overhead air vents | 12.00 | Ea. | $9.70 | $9.70 | ||
019309501700 | Moving Equipment, remove and reset, 100' distance, no obstructions, assembly or leveling unless noted, desk w ith chair | 8.00 | Ea. | $332.00 | $332.00 | ||
019309502600 | Moving Equipment, remove and reset, 100' distance, no obstructions, assembly or leveling unless noted, f ile cabinet | 8.00 | Ea. | $332.00 | $332.00 | ||
Totals for Division 1 General Requirements | $966 | $239 | $1,206 | ||||
Division 9 Finishes | |||||||
099123740800 | Paints & Coatings, w alls & ceilings, interior, concrete, dryw all or plaster, zero voc latex, 2 coats, smooth f inish, brushw ork | 3,016.00 | S.F. | $3,403.09 | $464.46 | $3,867.55 | |
099123741800 | Paints & coatings, w alls & ceilings, interior, zero voc latex, for ceiling installations, add | 3,016.00 | S.F. | ||||
099123748200 | Paints & coatings, w alls & ceilings, interior, zero voc latex, for w ork 8'-15' high, add | 3,016.00 | S.F. | ||||
Totals for Division 9 Finishes | $3,403 | $464 | $3,868 | ||||
Division 10 Specialties | |||||||
101113135450 | Chalkboards, liquid chalk, w hite porcelain enamel, w all hung, deluxe units, aluminum trim & chalktrough, 4' x 4' | 4.00 | Ea. | $349.65 | $950.40 | $1,300.05 | |
Totals for Division 10 Specialties | $350 | $950 | $1,300 | ||||
Division 12 Furnishings | |||||||
122113130020 | Blinds, interior, horizontal, solid color, stock, 1" aluminum slats | 72.00 | S.F. | $84.60 | $376.20 | $460.80 | |
Totals for Division 12 Furnishings | $85 | $376 | $461 | ||||
Estimate Subtotal | $4,804 | $2,030 | $6,834 | ||||
SubContractor OH & Prof it | $4,804 | $2,030 | $6,834 | ||||
Estimate Subtotal | $4,804 | $2,030 | $6,834 | ||||
Berkeley City Cost Index | $4,804 | $2,030 | $6,834 | ||||
Estimate Subtotal | $4,804 | $2,030 | $6,834 | ||||
Total Estimate | $4,804 | $2,030 | $6,834 | ||||
IN-HOUSE DETAILS – Example
ESTIMATE SUMMARY WORKSHEET – Example
BURDEN CALCULATION WORKSHEET – Example
PROJECT BUDGET ESTIMATE COVER SHEET
