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RE: Hillside foundation question

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I can't thank everyone enough for the thoughtful responses you gave. It is all valid information and will be very beneficial in helping me make the right decisions. I especially appreciate the welcoming attitude that I received. I considered not pushing the "send" button a number of times because I know how it can be when lay people start question the professionals on their own turf. I now have a much better understanding of the cost/benefit analysis in a number of areas. For the most part, what I got out of this was "trust your engineer, work closely with him, and be reasonable". I think that makes a lot of sense and I am sure that is how you would all want to be treated by any client.
 
I will touch on a few questions that were posed:
 
Yes, I had a geotechnical report done a number of months ago. It is a requirement for hillside building where I live. They did test holes and took soil samples.
 
The grade beams would not be elevated. There would be a concrete wall, 2'-3' high, sitting on the 24" grade beam along the downhill side. The building pad is relatively flat and will be very flat after a little cut and fill :)
 
I do have a loose working relationship with a concrete/foundation contractor that works closely with my SE. He will help estimate the costs. The agreement with the SE breaks the project down in two phases. The first phase is a preliminary design of the foundation to estimate costs. The second phase allows some changes to be made from the first phase, but locks me in to the new design without incurring additional costs. Like I said, I am trying to be as efficient as possible, and that includes living with what I design (or at least paying considerably more to change it). This two phase approach also allows me to cut down the size of the house if I just can't afford to build it. I should also say that my SE is a great guy and is going out of his way to work with me, as opposed to an architect, on such a large project (although, I am paying a little bit of a premium for that privilege, I feel it is worth every cent).
 
The bedrock on my hillside should be good for building. There is just a thin layer of topsoil and then, according to the soils engineer, it is expected to be fairly consistent to the maximum drilling depth, and increasing in density, the deeper they go. There is very little topsoil on the down slope side with numerous spots of dg exposed. The foundation guy I am working with (and has done numerous projects on these hills) expects that 5+ holes could be drilled a day. Of course, I realize that can change the instant they start drilling the first hole. This guy recently did a balcony for our neighbors that required 3 33' deep, 36 in wide holes to be dug by hand, because they could not get a drilling rig in the tight space. It took two guys well over a month to dig the holes (and put in the shoring on the way down!). That's not something I would want to do, especially after yesterday's earthquake.
 
Once again, thanks for all of your input and for being so kind. I know you didn't have to respond to my post and I am greatly appreciative to those that took the time to respond. The amount of information I got was much more than I hoped for.
 
Robert