Board packets, bid tabulations and a guaranteed maximum price are the documents that define a construction manager at risk project, and each of them exists because someone with a fiduciary duty must later justify what was spent. In this method the owner engages the construction manager during design, pays for preconstruction advice, and then has that same firm commit to a guaranteed maximum price and take on the risk of delivering within it. The construction manager competitively buys most of the work from subcontractors, and the owner can see how each package was bought.

The method suits owners who value transparency and who want a builder involved before the drawings are final. Counties, school districts, municipalities and universities in the northern Valley use public procurement processes that rest on accountability, and a delivery method that shows subcontract bids and allowances openly fits those habits. We write as people who have attended the board meetings and the bid openings, and who know the paper trail that follows.

Owners who commonly choose this method

Public agencies and institutions are the usual users, since the structure provides competition among trade contractors while allowing the owner to pick the manager on qualifications. Our education institutions and healthcare systems pages describe how the method applies to campuses and clinics, where phased occupancy and active operations constrain the work.

The City of Elsa Community Center, listed by the Texas Department of Licensing and Regulation as a 14,526 square foot, $4,820,600 new construction project registered on December 1, 2025, with construction scheduled from December 8, 2025 to March 1, 2027, is an example of a public building of the scale for which owners consider this method. We have no connection to that project, and the delivery method used for it is not stated in the record.

From selection to a guaranteed price

After selection, the construction manager joins the design team and prepares cost estimates at each stage. When drawings are about ready for bidding, the manager divides the work into bid packages, advertises or solicits them, reviews proposals with the owner and architect and recommends awards. The guaranteed maximum price is established when enough packages are bought to define the cost, or earlier with contingency for the remainder.

Early packages for site work, foundations or structural steel can be released before the full design is finished, which shortens the schedule. A parcel in eastern Hidalgo County, for example, may need drainage work first because Hidalgo County Drainage District No. 1 lists channel improvements for Ditch 1.9, 2 and 4a near Elsa at $23,010,000 for about 4.3 miles, and the sequence of that work can govern when a nearby site is ready.

How we run the process

We prepare a procurement plan that states the packages, the bidding method, the schedule and the criteria for evaluating bids. Subcontractors are prequalified, and bids are received in a form that can be reviewed by the owner and by anyone the owner designates. We keep minutes of bid openings, scope reviews and negotiations, because the record may be examined later.

Our preconstruction estimating work feeds this process, and our design-build delivery alternative is available for owners who prefer one contract with the designer. We explain the differences, including who holds design risk and how changes are priced.

Reporting continues through construction. Each month the owner receives a cost report comparing committed cost, projected cost and the guaranteed maximum price, a schedule update with the critical path identified, a log of change requests and a list of open items from the design team. Public owners can include these reports in board materials without rewriting them, and we format them with that use in mind.

Contingency, allowances and savings

The guaranteed maximum price includes the cost of the work, the construction manager's fee, general conditions and a contingency. The contract should state who controls the contingency and how unspent funds are handled. Allowances cover scopes that are not yet defined, and the owner should know what each allowance covers and what happens when it is exceeded.

Flood and drainage conditions can drive the allowance for site work. The National Weather Service recorded 9.78 inches of rain two miles north of Edinburg during Hurricane Hanna, and later storms in March 2025 left water lingering across the city, so we set aside funds for dewatering, additional fill and drainage corrections and report on their use.

We also recommend that the owner agree in advance on how buyout savings are used. Where bids come in under the estimate, the owner may want to return the savings to the budget, add deferred scope or hold them against later risk, and a decision made before the numbers are known is easier to defend than one made afterward.

Review, accessibility and inspections

The City of Edinburg Building Safety Department handles plan review, permits and inspections, with an online portal, and the Fire Marshal applies the International Fire Code and NFPA standards. The pages do not state the building code edition, and because Texas law makes the 2012 International Building Code the commercial floor with local adoption of later editions, we confirm the governing edition at the beginning of design.

Public buildings must also follow the Texas Accessibility Standards when the project costs $50,000 or more, which includes registration and review by the Texas Department of Licensing and Regulation. We schedule that review into the design phase so it does not interfere with bidding.

Bring us in before the drawings are done

Send us the program and the budget, and we will propose a plan for procurement and a schedule. Those planning projects in eastern Hidalgo County can read about Elsa, and campus owners about the UTRGV Edinburg campus area.

Questions Owners Ask

How does CM at risk differ from design-bid-build?

In design-bid-build the contractor is chosen after design, based mainly on price. In CM at risk the manager is chosen earlier, based on qualifications and fee, and gives advice during design. The owner gets more input into constructability and cost, but must manage a more involved process.

Who holds the risk of cost overruns?

Once the guaranteed maximum price is set, the construction manager bears the risk of exceeding it, except for changes the owner requests and conditions the contract assigns to the owner. We make sure the contract states these clearly.

Can small local subcontractors participate?

Yes. We divide work into packages of a size that local firms can bid, and we post bid dates in advance. Owners who value local participation can include it in the procurement plan, within the rules that apply to them.

Is it appropriate for a small building?

It can be, but the process has costs. For a modest, simple building, a lump sum or design-build contract may be more efficient. We say so when a smaller project does not warrant the full method.

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