Under-the-Table Gifts from Contractor Nab Senator

Alaska Senator Ted Stevens was indicted on Tuesday, July 29, 2008, by a federal grand jury for failure to report more than a quarter million dollars of gifts from a contractor who provided free renovations to Stevens’ home, in addition to other gifts. For the complete story, visit the Seattle Times to read their article on the subject.

Public officials, especially elected officials, are held to a high standard when it comes to drawing a bright line concerning their relationship with the business community. As stewards of the public trust, public officials should not profit from gifts or favors received from contractors and consultants they do business with or might do business with. The public expects that public officials will maintain the highest standards of ethics so that there are no conflicts or interest, apparent conflicts of interest, or attempts to buy the favor of public officials. This is a particularly important area for those responsible for government procurement and contracting to pay close attention to.

If you find yourself in a situation where you even have to ask the question of whether a particular action is ethical and appropriate, it may be an indicator that there would, at a minimum, be an apparent ethical issue involved. And, of course, there is always the “front page” test: how would a particular action look on the front page of the daily newspaper and would you want to see your name there describing your actions. Another question to ask is “what would a reasonable person assume?” about the meaning of a particular gift or action.

Many public agencies have written standards of ethics related to acceptance of gifts. It is important that public employees not only know about these standards but receive training so they can identify issues of concern as they arise. If your agency would like training in this area, please feel free to contact me.

Prevailing Wages on Federally Funded Projects

Public works construction projects that are funded in whole or in part with federal funds are normally subject to federal prevailing wages in addition to Washington State prevailing wages.

Federal legislation governing prevailing wages comes under what is known as the Davis-Bacon Act (and related acts), which was originally passed by Congress during the Depression.

However, depending on the source of the federal funds, the project may or may not actually be subject to federal prevailing wages. For example, projects funded by the National Institutes of Health (NIH), a part of the U.S. Department of Health and Human Services, are not subject to prevailing wages.

It is best to check the actual terms of your grant agreement with the federal agency to determine whether federal prevailing wages apply.

If federal prevailing wages do apply, they would normally apply in addition to Washington State prevailing wages, and the contractor would be obligated to pay the higher of the two wages for a particular classification of labor. Prevailing wages established by the U.S. Department of Labor (federal) and the Washington State Department of Labor and Industries (state) are based on different survey methodologies and thus the wages often differ for particular classifications.

Federal prevailing wage requirements also include an obligation for the contractor and subcontractors to submit weekly payroll reports that must be monitored by the public agency for compliance, and public agencies are often required to conduct on-site interviews with construction workers to validate information being submitted on the payroll reports.

Job: Capital Projects Coordinator – City of Seattle

The City of Seattle’s Fleets and Facilities Department is recruiting for a Capital Projects Coordinator.

Salary: $65,855 to $76,942

Filing deadline: Tuesday, August 5, 2008

Apply online at: www.seattle.gov/jobs

Job Description: Coordinate the development of construction contracts for the department. Work with project managers to develop clear scopes of work and contract provisions, and act as liaison with external contracting experts, attorneys, and public works consultants. Coordinate changes to boilerplate and standard specifications, perform risk assessments, and write contract amendments. Click here for more a more detailed job description.

Experience Requirements: Requires three years of capital project or construction management experience, and a bachelor’s degree in Architecture, Engineering, Business, or a related field. Experience writing contract language and vertical design and construction is highly desirable.

Insurance in the Construction Industry – Training Seminar

Insurance in the Construction Industry – Training Seminar

When: October 16 & 17, 2008

Where: Bellevue Courtyard Marriott -- Bellevue, WA

Cost: $250 for one day; $495 for both days

Sponsored by The Seminar Group

To view the full agenda, which includes registration information and pricing, click on this link. To register over the phone, or if you have any questions call (800) 574-4852.

Performance Audit Update from the State Auditor

In their Summer 2008 newsletter, Audit Connection, the Washington State Auditor’s Office has an article entitled Performance Audit Update.

There are construction management audits in various stages of planning for a dozen agencies. In addition, the article notes other performance audits underway now for a number of different programs at various agencies.

Training on Purchasing, Bidding, and Contract Management

The Washington State Department of Transportation (WSDOT) and the Municipal Research and Services Center (MRSC) have announced four upcoming training opportunities related to purchasing, bidding, and public works contracting for public agencies in the State of Washington.

The training is a two day event and you may choose to attend one or both days. The first day will address purchasing and bidding issues and the second day will address public works contracting issues.

Dates and Locations:

• September 24-25, 2008, Tacoma, WA
• October 28-29, 2008, Moses Lake, WA
• November 12-13, 2008, Vancouver, WA
• December 10-11, 2008, Mount Vernon, WA

Cost is $75.

Instructors: Mike Purdy (UW) and John Carpita (MRSC)

For more information visit WSDOT’s website.

New CPARB Member Appointed by Governor

Washington State Governor Christine Gregoire this month appointed Norman Strong, a partner with the architectural firm of The Miller/Hull Partnership, as the representative of the design industry on the Capital Projects Advisory Review Board (CPARB).

Mr. Strong served as president of the Seattle chapter of the American Institute of Architects (AIA) from 2000 to 2001. He has a bachelor’s degree in architecture from Washington State University (1978).

CPARB was created in 2005 by the Washington State Legislature to review alternative public works contracting procedures and provide guidance to state policymakers on ways to further enhance the quality, efficiency and accountability of public works contracting methods. There are 22 members of CPARB.

AGC Concerned About Bidder Responsibility

The Associated General Contractors of Washington (AGC) published an item on their website on July 22, 2008 expressing their concern about how certain public agencies are implementing the provisions of RCW 39.04.350,the bidder responsibility legislation. This law, which became effective on July 22, 2007, was passed by the Washington State Legislature as SHB 2010. The legislation gives public agencies the opportunity to establish relevant supplemental bidder responsibility criteria for public works construction projects.

The AGC is concerned that some agencies are establishing criteria that overly restrict the bidding pool and eliminate otherwise qualified bidders from submitting a bid. I have not seen the bidder responsibility language from King County and Community Transit that the AGC noted as problems.

It is important for public agencies to understand how to use this new tool properly. I have done a significant amount of training across the State in the last year on this subject. In addition, the Capital Projects Advisory Review Board (CPARB) has adopted Suggested Guidelines for Bidder Responsibility that provides helpful suggestions for how to implement the new law.

If you would like assistance on developing or reviewing supplemental bidder responsibility criteria for a particular project or would like training for your agency, please contact me. In addition, if you hear of problems arising from the implementation of the law, please let me know.

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Training on AIA Contracts

AIA Contracts

When: Tuesday, August 12, 2008, 8:30 a.m. to 4:30 p.m.

Where: Washington State Convention and Trade Center (800 Convention Place, Seattle)

Cost: $369

Sponsored by: Lorman Education Services

For more information and registration click here.

Minority Truckers Not Needed at Brightwater

A group of minority truckers operating as the Truckers Consortium was notified last week that they would not be used on King County’s $1.8 billion sewage treatment project at Brightwater.

The change occurred when a subcontractor, L&J Construction of Cle Elum, that the Consortium members were going to work for, was replaced on the remainder of the project by a different contractor, the large international construction firm, Parsons.

Despite the blow to the small contractors that make up the Truckers Consortium, King County asserted that the project would still meet its goal of 10% of the work going to small businesses.

The Truckers Consortium is a creative and unique initiative in which ten small trucking firms have banded together to help obtain business together.

For more details on this story, read the article in the Seattle Times.

Construction Contracts Training

The Fundamentals of Construction Contracts: Understanding the Issues

When: Thursday, July 24, 2008, 8:30 a.m. to 4:30 p.m.

Where: Holiday Inn Seattle Center (211 Dexter Avenue North, Seattle)

Cost: $369

Sponsored by: Lorman Education Services

For more information and registration click here.

McIver Violates Seattle Ethics Code on Contracting

Seattle City Council member Richard McIver was fined $1,000 by the Seattle Ethics and Elections Commission on July 16, 2008 for violating the city’s ethics code. McIver awarded a consultant contract to a firm whose owner he was close friends with and at whose condominium he enjoyed vacations.

This case is a good reminder that elected officials and those in government responsible for contracting and procurement must be very careful in making decisions in order to avoid both real conflicts of interest as well as the appearance of impropriety.

The full story of McIver’s violation may be read in the Seattle Times story. The website of the Seattle Ethics and Elections Commission includes the document charging McIver.

Bechtel Career Fair in Bellevue

Bechtel National, a major engineering and construction company, will hold a Career Fair in the Seattle area in July.

When: Friday, July 25, 2008 from 3:00 p.m. to 9:00 p.m. and Saturday, July 26, 2008 from 9:00 a.m. to 3:00 p.m.

Where: Hyatt Regency Bellevue, 900 Bellevue Way NE, Bellevue, WA

They are advertising that they have immediate openings for Contracts and Procurement Specialists. They are also recruiting for other positions in construction, engineering, and project controls.

For more information, visit Bechtel’s website.

Job Opening: Contracts Administrator, Port of Tacoma

The Port of Tacoma is recruiting for a Contracts Administrator to provide technical and professional contract related support to engineering project managers as well as other contract administrators.

The salary range is between $46,770 and $58,462.

First review of resumes started on July 18, 2008.

For more information, click here for the job description.

Job Opening: Purchasing Manager, Bellevue Community College

Bellevue Community College is recruiting for a Purchasing Manager.

The salary range is between $48,388 and $58,066.

Applications received by August 6, 2008 will receive first consideration.

For more information, click here for the job description.

CPARB – 2009 Legislative Priorities

The Capital Projects Advisory Review Board (CPARB) met on July 10, 2008 to discuss legislative priorities for the 2009 Legislative session of subcontractors and public owners. At the August 14, 2008 CPARB meeting, the Board will considered legislative priorities from contractors and labor unions.

Subcontractor Priorities: Subcontractors presented three issues they would like to see endorsed by CPARB and approved by the Legislature:

1. Require payment of prevailing wages on Public-Private Partnerships.
   
2. Include Housing Authorities as a specifically named public entity covered by the alternative public works contracting procedures of chapter 39.10 RCW.
3. Modify the definition of “prefabricated modular building” in RCW 39.10.300 (the Design-Build statute) to limit the number of such modular buildings that may be used on a project without having to obtain the approval of CPARB’s Project Review Committee.

Owner Priorities: Owners presented four issues they would like to see endorsed by CPARB and approved by the Legislature:

1. Permit all public agencies in the state to use the provisions of RCW 39.04.015 that currently only allows “state contracting authorities” the ability to negotiate a bid price on a public works project, under limited circumstances.
2. Increase the thresholds for the Small Works Roster to $500,000 (from $200,000), and increase the Limited Public Works threshold from $35,000 to $100,000 (RCW 39.04.155).
3. Include Best Value Procurement as a fourth alternative public works contracting process.
4. Increase the dollar thresholds for cities and counties for the amount of work that may be performed with their own forces without having to contract it out.

There will be additional discussion by CPARB on these issues as part of deciding whether CPARB should recommend legislation to address these concerns.

Negotiating with the Low Bidder

May a public agency in the State of Washington negotiate with the low bidder on a public works project if their bid is too high?

Yes, a “state contracting authority” may do so under certain circumstances. The term state contracting authority applies to stage agencies and not municipalities, cities, counties, port districts, housing authorities, etc. – unless the Legislature amends RCW 39.04.015 during the 2009 Legislative session.

At the July 10, 2008 meeting of the Capital Projects Advisory Review Board (CPARB), public owners proposed by this law be revised to expand its use to all other government agencies in Washington State. CPARB will continue its discussion of the proposal and may or may not vote to make such a recommendation to the Legislature. There is opposition to such a measure from subcontractors, labor unions, and the bonding industry

RCW 39.04.015 provides that a state contracting authority may negotiate with the low bidder on a public works project, based “upon agreed changes to the contract plans and specifications” when the bid exceeds the available funds. In addition, the amount of the bid exceeding the available funds must fall within the following specified thresholds:

• 5% for projects valued under $1 million

• The greater of $50,000 or 2.5% for projects valued between $1 million and $5 million

• The greater of $125,000 or 1% for projects valued over $5 million

Finally, such negotiation must result in the contract amount being within the available funds.

There is one other bid negotiation law for public works projects available in Washington State law that affects not public agencies but General Contractors/Construction Managers (GC/CMs) on public projects. Like RCW 39.04.015 discussed above, RCW 39.10.380 (6) provides a formula basis for when the GC/CM may negotiate with a subcontractor on a publicly advertised subcontract bid package under the GC/CM project.

2008 Washington Small Business Fair

On September 6, 2008, the free Washington Small Business Fair will be held at Renton Technical College (3000 NE 4^th Street, Renton, Washington). It will last from 8:00 a.m. to 4:00 p.m. It is an opportunity for small businesses to obtain information about how to start or expand their business.

More information about this event may be obtained from their website at www.bizfair.org.

Public-Private Partnerships

Some people characterize Public-Private Partnerships as an alternative project delivery method for public works projects. Others point out that this isn’t really a project delivery method, but a method for financing projects that benefits the public.

What are Public-Private Partnerships? They may take a variety of contractual terms, but involve contracting for construction that benefits the public and a private entity, but isn't paid for through the typical methods where an owner pays a contractor directly for constructing a project. They may involve leases, purchase of condominiums, tax incentives, land arrangements, and other financing and purchase tools. They are generally viewed as an economic development tool that benefits both the private entity and the government agency.

In Washington State, there is significant interest from labor unions and subcontractors to require that prevailing wages be paid on these Public-Private Partnership projects. The Capital Projects Advisory Review Board (CPARB) will be discussing the matter more to determine if they have authority to develop recommendations to the Legislature on this topic.

Washington State law addresses only one instance of when prevailing wages apply for these types of projects. RCW 39.04.260 requires payment of prevailing wages if a public agency “causes to be performed” work for a building or facility in which the public agency will rent, lease, or purchase at least 50% of the project. But there are many other types of projects in which a public agency and a private entity cooperate for the development of a facility that doesn’t meet the 50% threshold noted in RCW 39.04.260.

During the 2008 Legislative session, Senate Bill 6938 was introduced that would have required payment of prevailing wages on these public-private partnership projects related to tax incentives, loans, sales for less than fair market value, and leases. The legislation stated that:

“Projects covered by this chapter [39.12 RCW – Prevailing Wages] include, but are not limited to, any work, construction, alteration, repair, or improvement other than ordinary maintenance that involves tax incentives established by the state or any county, municipality, or political subdivision created by its laws; loans provided by the state or any county, municipality, or political subdivision created by its laws; sales of public land or property to a private entity for less than fair market value by the state or any county, municipality, or political subdivision created by its laws; or leases of public land or property to a private entity by the state or any county, municipality, or political subdivision created by its laws.”

The issue needs to be addressed carefully in the State since the application of prevailing wages to some of these projects may mean that the project may not be financially feasible, and thus the public would not benefit. This is a classic case of “policy collision” in which two equally valid policies conflict: the public interest in economic development and the payment of prevailing wages. The Legislature will need to carefully examine the potential negative ripple effects of adopting any legislation that would require payment of prevailing wages on a broad range of public-private partnerships.

Integrated Project Delivery

Integrated Project Delivery goes beyond the benefits of other project delivery models that attempt to create more of a culture of collaboration. For example, in Design-Build, the elimination of two parties into one party helps to reduce conflicts. In Integrated Project Delivery, the owner, designer, and contractor enter into one agreement to perform the work, appropriately allocate risks, and agree to collaborate.

Integrated Project Delivery as a delivery method is not currently authorized for public agencies in the State of Washington.

The architectural firm, NBBJ, has put together a PowerPoint presentation describing this methodology in more detail. Please contact me if you would like me to e-mail this to you. In addition, the American Institute of Architects (AIA), has information on their website about Integrated Project Delivery.

Best Value Procurement

The Capital Projects Advisory Review Board (CPARB) has begun discussions about Best Value Procurement. Essentially, this is an off-shoot of the traditional Design-Bid-Build, but could best be characterized as “Design-Select-Build.” The distinction is how the contractor is selected.

In Design-Bid-Build, the contractor is selected based on a low bid. In Best Value, the contractor is selected based on a combination of price and qualifications, experience, and approach.

Naturally, some contractors are concerned about such an approach for two reasons.

1. It puts some contractors at a disadvantage when compared to larger and more experienced firms.
2. Contractors are concerned that public agencies may manipulate the selection process to only select their favorite contractors.

How Best Value Procurement gets developed (and if it does) and what evaluation criteria will be used will make a big difference as to whether this alternative delivery method is added to the tool belt for use by public agencies in Washington State.

There are different versions of Best Value Procurement in existence. Arizona State University’s Performance Based Studies Research Group (PBSRG) touts a version of Best Value that, in my opinion, is heavily biased against public agencies in favor of contractors. Read my earlier blog entry about this method, based on my attendance at their training, by clicking here.

Is it Time for New Alternative Public Works Contracting Methods?

In the State of Washington, there are three project delivery methods for public works construction contracts that are officially designated as “alternative public works” contracting procedures (chapter 39.10 RCW).

• General Contractor/Construction Manager (GC/CM)
• Design-Build
• Job Order Contracting
  

They are viewed as “alternatives” to the traditional “Design-Bid-Build” of government agencies in the State to procure construction services – where the public agency hires a designer (architect or engineer) to “design” the project by developing detailed design specifications and drawings. Then the public agency advertises and “bids” the project to contractors. The responsible contractor submitting the low responsive bid is awarded the contract and they then “build” the project.

While Design-Bid-Build has been around a long time in the State, it has its inherent problems – always awarding to the low bidder doesn’t always serve the public’s interests. Recognizing this concern, the State Legislature has authorized these three “alternative” project delivery methods for public works construction projects.

But beyond these three alternative project delivery methods, there are other tools that are used in other parts of the country and in the private sector, some of which are getting attention in Washington State. These include the following:

• Best Value Procurement
• Integrated Project Delivery
• Public-Private Partnerships

I will write about each of these other methods in subsequent postings to this blog.

Prevailing Wage Exemption for Company Owners

The Washington State Department of Labor and Industries (L&I) recently adopted a new version of its “Statement of Intent to Pay Prevailing Wages” (“Intent”), a form required to be filled out by the contractor and every subcontractor on public works projects before a public agency makes any payments to the contractor.

One of the new questions on the Intent requires contractors and subcontractors to note the “number of Owner/Operators that own at least 30% of the company who will perform work on the project.” The question is an attempt to educate the industry that only certain individual owners are exempt from prevailing wage requirements.

Actually, the question on the form isn’t as specific as it should be to describe the requirements of L&I’s regulations on prevailing wage exemptions for owners. They probably just didn’t have room on the form to be more complete.

Under L&I’s prevailing wage regulations (WAC 296-127-026) only certain owners of construction companies are exempt from the State’s prevailing wage requirements, defined as follows:

1. Sole owners and their spouses.
2. Any partner who owns at least 30% of a partnership
3. The president, vice-president and treasurer of a corporation if each one owns at least 30% of the corporation.

The regulations are intended to prevent contractors from simply labeling all of their workers as owners. Nevertheless, in certain trades such as floor laying and drywall, it is a common practice for an individual worker to become a registered contractor. They are then hired by general contractors for an amount that equates to less than the prevailing wage rate, with many of them working not by the hour, but by the “piece” or how much work they actually accomplish.

Ensuring payment of prevailing wages on public works projects is an ongoing challenge that is of concern to many. Without compliance with the law, the integrity of the competitive bidding process is undermined, and quality on the project may suffer as well.

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Early Subcontract Bidding on GC/CM Projects

It’s been a little over a year now since the July 1, 2007 effective date of a revised Washington State law for General Contractor/Construction Manager (GC/CM) contracting (chapter 39.10 RCW).

One of the more untested and potentially risky provisions of the new law provides that a public owner may, at its option, authorize the GC/CM “to proceed with bidding and award of bid packages and construction before receipt of complete project plans and specifications. Any contracts awarded under this sub section shall be incorporated into the negotiated maximum allowable construction cost.” (RCW 39.10.370 (3))

What this means is that the GC/CM would be conducting subcontract bidding for work with incomplete plans. In addition, the owner and the GC/CM would not have yet negotiated the cost of the work. An owner may want to pursue this route in order to meet a tight schedule for the project. In addition, there are advantages to having major subcontractors on board early to work with the GC/CM on pre-construction services with the GC/CM. Prior to embarking on this course, however, the owner should have careful discussions about the potential risks of such an approach and how to manage and mitigate against them.

One potential risk is how to manage the cost risk of increases in the subcontract amount until the time the plans and specifications are fully developed. Who should bear the risks for such cost increases: the owner, the GC/CM, the subcontractor, or a combination of the three? It all depends how complete the subcontract bidding documents are, what assumptions are placed on the subcontractors, whether the owner adds new work during the finalization of the documents, etc. It’s a complicated question that requires careful thought about how to fairly manage the risks.

Another risk for conducting early subcontract bidding and awarding the work and having construction begin prior to successful negation of the Maximum Allowable Construction Cost (MACC) is how to handle the possibility that the owner and GC/CM may not be able to negotiate a MACC. Under this scenario, the owner would have a partial MACC contract with the GC/CM, work may be progressing, and the owner may then need to select the second highest ranked GC/CM for the rest of the work or put the remainder of the work out for bid.

In contracting for early subcontract bid packages with the GC/CM, the owner will need to include a percentage of the costs previously bid by the GC/CM for “Fixed Amount for Specified General Conditions” work. The owner will also need to apply the Percent Fee (also bid by the GC/CM) to the portion of the “mini-MACC” resulting from the early subcontract bidding.

Early subcontract bidding, award, and construction has its place, but the owner must be very thoughtful and savvy in managing the potential downsides of such an approach. It will be interesting to see the results of some owners as they explore this new option under the law.

New Prevailing Wage Form for Listing Subcontractors

The Washington State Department of Labor and Industries (L&I) has unveiled a new Affidavit of Wages Paid form, and a new addendum form to be completed as an attachment to the Affidavit of Wages Paid form for public works projects, both effective July 11, 2008.

In a major policy change, the L&I is now requiring contractors to fill out a new “Addendum B, List of Next Tier Subcontractors” form as an attachment to the Affidavit of Wages Paid if the contractor filling out the Affidavit of Wages Paid subcontracted any of the work. The Addendum B is in addition to the Affidavit of Wages Paid. There is no additional filing fee for Addendum B.

Addendum B, which must also be approved by L&I, requires a listing of the following: subcontractor’s business name, UBI number, contractor registration number, and phone number.

If the contractor is filing the Affidavit of Wages Paid manually, the Addendum B must be stapled to the Affidavit of Wages Paid. If the contractor is filing electronically, they will have the ability to list the subcontractors used online.

In addition to this major change, L&I is revising both the Statement of Intent to Pay Prevailing Wages form and the Affidavit of Wages Paid to reflect the increase in the filing fee from $25 to $40, the result of legislation approved by the Legislature in the 2008 session (EHB 3381).

Drawbacks of Mediation on Public Works Projects

Don Owen is a Washington State based consultant who provides construction management and construction litigation support services to public owners, contractors, and attorneys. On July 2, 2008, the Seattle Daily Journal of Commerce newspaper ran an article written by Mr. Owen on some of the potential drawbacks of the mediation process.

Mr. Owen suggests that often the primary driver for settlement during mediation is how much it will cost each side if the mediation is not successful and moves to a lawsuit, rather than the merits of each position.

Mr. Owen has posted an expanded version of the article, The Mathematics of Mediation, on the website of his consultant business, Donald Owen & Associates, Inc. You can read the article by clicking here. On his website, he has also posted other articles he’s written on construction management.

Reference Checks When Selecting Consultants

What role should references from previous client play in evaluating and selecting consultants on public projects, particularly architects and engineers, where the “most qualified” firm must be selected? Should references actually be an evaluation criterion?

Clearly, a public agency has an interest in ensuring that the consultant to be selected has a good track record. However, since selections are often done through an evaluation committee, checking references becomes somewhat problematic if it is to be one of the selection criteria. Does that mean that each member of the committee should contact each of the references for each of the firms submitting qualifications or proposals? That quickly becomes a logistical and time-consuming nightmare.

My suggestion is that reference checks not be part of the evaluation criteria, but that they be used to help validate the information provided by the firms. To help explain what I mean, I’ve included sample language below that I include in Requests for Qualifications (RFQs). The same would apply for Requests for Proposals (RFPs) with the language being adjusted as appropriate.

“The Owner reserves the right to conduct reference checks for the highest scoring firm(s) either after qualifications have been evaluated, and/or after interviews have been held. In the event that information obtained from the reference checks reveals concerns about the firm’s past performance or their ability to successfully perform the work of the contract to be executed based on this RFQ, the Owner may, at its sole discretion, determine that the firm is not the most qualified firm and may select the next highest-ranked firm whose reference checks validate the ability of the firm to successfully perform the work of the contract to be executed based on this RFQ. In conducting reference checks, the Owner may include itself as a reference if the firm has performed work for the Owner, even if the firm did not identify the Owner as a reference.”

Fire Sprinklers On Strike

On July 1^st, the fire sprinklers union, representing some 500 fire sprinkler installers, went on strike after their contract expired. The strike affects a number of projects in the Puget Sound area, and other union construction trades are honoring the picket lines that have been set up at about 25 project sites.

Read more about the strike in the Seattle Times and the Puget Sound Business Journal.

Contractor Builds City Hall in Wrong Location

It’s an owner’s and contractor’s worst nightmare – but it happened in the city of Edgewood, just east of Tacoma.

The contractor made a mistake in the surveying process and is building the new city hall in the wrong location – off by more than a foot. The $7.2 million building is now too close to the road, and there will be additional costs involved in relocating a transformer and generator.

You can be sure that both parties will be carefully scrutinizing the contract to determine liability and additional cost issues. Let’s hope that the contract is clear and protects the public’s interest. This is a classic example of why good contracts are critical. When things go wrong, as did on this project, it is the terms of the contract that will control who pays for the error.

For more information on this, you can read the Seattle Times story.

GC/CM Resources - Helpful Links

• State Law:
• RCW 39.10.210 and 39.10.340 through 39.10.410
• http://apps.leg.wa.gov/RCW/default.aspx?cite=39.10

• Project Review Committee:
• http://www.ga.wa.gov/CPARB/PRC
  

• Capital Projects Advisory Review Board (CPARB):
• http://www.ga.wa.gov/CPARB
  

• University of Washington, Capital Projects Office, GC/CM documents:
• http://www.cpo.washington.edu/html/Contract_Boilerplate_GCCM_Project_2004.htm
  

• Article: “Washington’s GC/CM Public Works Contract Format: Will it See 2008?”, by J. Todd Henry, Oles Morrison Rinker & Baker LLP
• http://oles.com/publications/2005/GC.CM%20Construction%20Format.pdf

• Seattle City Auditor Report: GC/CM Form of Contracting: Issues and Recommendations, February 12, 2004
• http://www.seattle.gov/audit/report_files/2004-05_GCCM_Report.pdf

• Joint Legislative Audit and Review Committee (JLARC): An Assessment of GC/CM Contracting Procedures, June 22, 2005
• http://www.leg.wa.gov/reports/05-9.pdf
  

Happy 4th of July!

Wishing you and yours a very happy and safe 4th of July!

Selection Process for Architects and Engineers

Under Washington State law (chapter 39.80 RCW), public agencies may not use cost as an evaluation criterion in the selection of architects, engineers, landscape architects, and land surveyors. Instead, agencies are required to select the "most qualified" firm and then negotiate an acceptable contract amount with that firm. This process is frequently referred to in the industry as "Qualifications Based Selection."

One question that frequently comes up is whether certain types of services are covered by this process. In evaluating this question, it is important to ask whether the work must, by law, be performed by one of the four disciplines covered by chapter 39.80 RCW (architect, engineer, landscape architect, land surveyor). State law defines what is included in the practice of each of these four professions:

• RCW 18.08.320 (10) defines the practice of Architecture.
• RCW 18.43.020 (5) defines the practice of Engineering.
• RCW 18.43.020 (9) defines the practice of Land Surveying.
• RCW 18.96.030 defines the practice of Landscape Architecture.

If the work under consideration is required by law to be performed by one of these disciplines, then a Request for Qualifications (RFQ) is the correct tool to use in the selection process. In an RFQ, cost may not be one of the evaluation criteria.

If, however, a firm or person practicing in one of these four professions might typically perform the work, but anyone who had sufficient knowledge and experience could legally perform it, then the selection process would not be subject to chapter 39.80 RCW, and price could be used as one of the selection criteria.

There are often questions about the engineering profession and what work is engineering work under chapter 39.80 RCW. Environmental engineering and geotechnical engineering frequently come up as questions. I believe both of these are covered by the State's Qualifications Based Selection process in chapter 39.80 RCW.

Selection of a consultant not subject to chapter 39.80 RCW should be based on the laws applicable to your type of public agency and your agency specifically. For example, State agencies and port districts are subject to requirements for Personal Service Contracts (chapter 39.29 RCW). Some public agencies have local ordinances that regulate consultant selection.

In the absence of any State law or local regulation affecting consultant selection for non-architects/engineers, a Request for Proposals (RFP) would be the most appropriate solicitation tool to use. In an RFP, evaluation criteria would include both qualifications and the consultant's proposed price for performing the work. If the work was not sufficiently defined, the RFP may also ask for the consultant's approach or proposal for how they would accomplish the agency's objectives, and this could also be part of the evaluation criteria.

King County Contract Specialist II – Job Opening

King County is advertising for a Contract Specialist II focusing on the procurement of technical, professional, community agency, engineering and/or architectural consulting services and contracts.

Salary range: $63,086.40 - $79,976.00 annually

Closing date for applications: July 14, 2008, 4:30 p.m.

For more information, including the full job description and application procedures, visit King County’s website.

Finding the Sales Tax Rate for Washington State

The sales tax amount varies in Washington State by city and taxing jurisdiction. The Department of Revenue has a helpful website where you can enter a location to search for the current sales tax percentage. Click here to find out the sales tax for your location.