Lawrence, Kansas Turns to CMAR for $74M Wastewater Job — What That Means for Bonding and Risk Allocation

McCarthy Building Companies completed a $74 million wastewater treatment upgrade for the city of Lawrence, Kansas, marking the first time Lawrence has used the construction manager at risk delivery method on a wastewater infrastructure project. That distinction is worth examining, because CMAR carries a specific set of bonding and contract obligations that differ meaningfully from traditional design-bid-build — and more municipalities are moving in this direction on complex utility work.

Under a standard design-bid-build contract, the general contractor bonds the full scope at bid time, pricing risk into a lump sum. CMAR changes that structure. The contractor comes in during preconstruction, often before design is complete, and the guaranteed maximum price is established later in the process. That timing gap has real implications for how surety relationships are structured and when performance and payment bonds are issued. For more on the topic discussed above, see Contractor Press News.

Why Surety Underwriters Look at CMAR Differently

Sureties evaluating a CMAR project are not looking at a finalized set of drawings when they first assess the contractor's qualifications. They are underwriting the firm's ability to manage an evolving scope, control subcontractor costs, and hold a GMP that may be set months after the initial contract award. That requires a deeper look at the contractor's preconstruction track record, not just their bonded backlog.

For a project the size of the Lawrence wastewater facility, the bond premium alone is a significant line item. Performance bonds on public construction jobs in Kansas, as in most states, are governed by the Kansas Contractual Claims Act and related procurement statutes, which require bonds on public contracts above specified thresholds. The CMAR structure does not eliminate that requirement — it shifts when and how the bonded amount is locked in.

McCarthy, which is headquartered in St. Louis and operates across the United States, has an established surety relationship that allows it to bond large, complex jobs in this delivery format. Smaller regional GCs pursuing CMAR opportunities for the first time may find their surety less comfortable with the open-ended preconstruction phase, particularly on wastewater and water treatment work, where environmental compliance milestones add another layer of performance risk.

Lawrence's decision to use CMAR here also reflects a broader trend among mid-sized municipalities. Water and wastewater infrastructure upgrades funded in part through federal programs — including allocations under the Water Infrastructure Finance and Innovation Act, administered by the U.S. Environmental Protection Agency — increasingly come with complexity that pushes owners toward collaborative delivery methods. CMAR gives owners more visibility into cost as design develops, which matters when federal grant conditions require budget accountability at specific project milestones.

The practical takeaway for GCs eyeing CMAR opportunities in the public utility space: get your surety into the conversation before you submit your qualifications package, not after you're shortlisted. Underwriters need time to understand the preconstruction fee structure, how the GMP is established, and what contingency provisions exist in the contract. Walking in with a completed qualifications submittal and expecting a quick bond commitment on a CMAR job is a reliable way to slow down your own pursuit.