CELAWS

QUIZ 2
Total Project Cost
Probable total cost is a major concern of the client throughout the planning design, and construction
phases of a project. The probable total capital cost, often used to establish budgets for a typical project,
is made up of:
1. Professional Engineering Cost
A Civil Engineering is often engaged to make a study and to render a planning report on the
contemplated project, including alternative solutions, layouts, and locations along with initial
estimates of the probable project cost. The study and report phase may include the cost for field or
traffic surveys, planning analysis, geotechnical explorations and analysis, in addition, to the direct
engineering costs.
2. Construction Cost
The study and report phase of the project usually includes a preliminary estimate of the construction
cost for the contemplated project and for alternative project configurations. Such cost estimates are
approximate, since the final design drawings and specifications have not yet been prepared. In
addition, the timing of the construction work must be considered because inflation will affect the
construction cost.
Construction Cost is the estimated total cost of constructing the facility to be covered by the
proposed detailed design or construction supervision services, excluding the fees and other costs of
such services, the cost of land and right-of-way, and legal administrative expenses of the agency. The
estimated construction cost must be approved by the client before the invitation to submit technical
proposal is issued.
3. Legal, Land, Administration, Staffing and Financial Costs
These costs, which include audits, the cost of issuing bonds, land costs, and interest for borrowed
money during construction, are part of the probable total project cost and can be estimated in
cooperation with the client because they are usually outside the knowledge and control of the Civil
Engineer.
4. Contingency Allowance
To provide for intangible cost, contingencies should routinely be added to the basic cost estimate. It
is common practice to add 20% or more to the estimated probable total project cost at the
completion of the study end report phase, reducing this to perhaps 10% at the completion of the
final design and perhaps to 5% when the construction bids become known. Larger or more complex
projects may require higher contingencies.