Governor Proclaims March as "Purchasing Month"

Washington Governor Christine O. Gregoire has proclaimed March 2010 as "Purchasing Month" in recognition of  the significant role that the purchasing and materials management professions play in the efficiency and effectiveness of both government and business.

The February 8, 2010 Proclamation signed by the Governor also notes that the Washington State Chapter of the National Institute of Governmental Purchasing (NIGP) and other professional purchasing associations will engage in "special efforts to inform the public on the important role the purchasing profession plays in business, industry, and government."

Speech on "Issues and Trends in Public Project Delivery"

I'll be giving a speech on Friday morning at 8:45 a.m. (February 26, 2010) at the Annual Seminar of the Pacific Northwest Chapter of the Construction Management Association of America (CMAA) on "Issues and Trends in Public Project Delivery."

Here's a high level outline of my speech:

• Why We Have Competitive Bidding
• 4 Trends in Public Project Delivery
• Contracting and Delivery Models:

1. Design-Bid-Build
2. General Contractor/Construction Manager (GC/CM)
3. Job Order Contracting
4. Public-Private Partnerships
5. Maintenance Contracts
6. Best Value
7. Integrated Project Delivery (IPD)

 The Annual Seminar will be held in Bellevue, Washington at the Mount Si Conference Room at 500 108th Ave NE.

Free Construction Management Certification - Application Workshop

The Pacific Northwest Chapter of the Construction Management Association of America (CMAA) and the Seattle Department of Transportation (SDOT) are sponsoring a free workshop to assist construction management professionals in obtaining a CMAA construction manager certification designation.

The five part workshop will be held on the following dates, all beginning at 6:00 p.m., except for the last optional dinner recognition meeting starting at 5:00 p.m.:

• March 1, 2010
• March 15, 2010
• March 29, 2010
• April 12, 2010
• April 22, 2010

For more information, visit CMAA's website. 

To sign up, e-mail Don Laford at Don_Laford@urscorp.com.  Space is limited.

Legislative Hearing on GC/CM Selection of Electrical and Mechanical Subcontractors

Steve Goldblatt, recently retired, longtime University of Washington Construction Management faculty member specializing in design and construction law, has been covering the legislative scene in Olympia for more than 25 years.

In this guest blog post, Steve notes an important bill, endorsed by the Capital Projects Advisory Review Board (CPARB) that will be considered in a hearing on Friday, February 26, 2010.

GC/CM Subcontractor Selection: SB 6401 would authorize an alternative selection method for electrical and mechanical subcontractors on general contractor/construction manager projects (Chapter RCW 39.10). This bill passed out of the Senate two weeks ago, 48-0. Hearing on Friday, February 26, 2010, at 8:00 a.m. in the House Committee on Capital Budget.

Holding the Contractor Responsible for All Specification Provisions

Specification writers frequently describe that a particular subcontractor, such as the electrical subcontractor or the subcontractor performing the work of Section XYZ, is responsible for performing certain work.

One of the problems with this language is that it potentially limits the liability of the contractor who is ultimately responsible for performing all the work of the contract, including being responsible for the work of all subcontractors.

There are two ways to address this concern and ensure that the specifications are clear with respect to the accountability of the contractor for all of the work:

1. Ensure that any references to specific subcontractors as being responsible for work are changed to reflect that the contractor is responsible for the work.
   
2. Include a global statement in the contract or General Conditions that states something like the following:  

"Any references included in the contract documents that purport to address the responsibilities of work by crafts and specialty or trade contractors or subcontractors, are included only for the convenience in preparing and reading the contract documents, and do not in any way limit the full responsibility of the contractor to provide a complete installation and be responsible for all of the work under the contract."

Who Should Be the Obligee on a GC/CM Bid Bond?

Under the General Contractor/Construction Manager (GC/CM) model of project delivery in Washington state, the contractor (GC/CM) is required to competitively bid all subcontract bid packages and award to the lowest responsible bidder with a responsive bid (RCW 39.10.380).  

For work more than $300,000, each bidder is required to submit a bid bond.

Who should be the obligee on the bid bond?  In other words, who should the bid bond protect in the event the bidder fails to enter into a contract for the work?  

There are three different types of potential bidders on a GC/CM subcontract bid package:

1. Subcontractor:  If a subcontractor bids work more than $300,000, the obligee on the bid bond should be the GC/CM, since it is the GC/CM who will award the subcontract, not the owner.
   
2. GC/CM:  A GC/CM is permitted to perform no more than 30% of the Maximum Allowable Construction Cost (MACC), provided they submit a bid for a subcontract bid and are the low bidder (RCW 39.10.390).  In such a case, for work more than $300,000, a bid bond is required from the GC/CM and should name the owner as the obligee.  The bidder (GC/CM) and obligee cannot be the same party.  All other subcontract bidders should name the GC/CM as the obligee.
   
3. Subsidiary of the GC/CM:  If a subsidiary company of the GC/CM bids subcontract work and is the low bidder, the work would be counted as self-performed work by the GC/CM.  If the amount of the work is more than $300,000, the bid bond from the subsidiary of the GC/CM would name the GC/CM as the obligee, provided that the subsidiary is actually a separate legal entity.

The requirement for a bid bond applies to projects where the work is more than $300,000.  The GC/CM should establish the bid bond requirement in the bidding documents for those subcontract bid packages more than $300,000.  Even if the amount of a subcontract bid ends up being less than $300,000, the bid bond must still be submitted as it would be a requirement of the bidding documents.

If you have a different interpretation of who the obligee should be under the various subcontract bidding scenarios, please contact me with your reasoning.

1 Space Available in Public Works Close-out Class Due to a Cancellation

Due to a cancellation, there is one spot left in the class this Wednesday, February 24, 2010 on "Public Works Contract Close-out: Bonding, Retainage, and Claims."

The class will be in Everett, Washington from 10:00 a.m. to 3:00 p.m.  Cost is $125.

If you're interested in attending, please call me at (206) 295-1464 to discuss registration.  First come, first served.

Florida Officials Consider New Selection Process After Bid Protest Lodged

Officials in Martin County, Florida are preparing to reject all bids and re-advertise an $8.7 million Aquatics Complex Design-Build project after a bid protest challenged how the successful bidder, Bayview Construction was added late to the list of qualified contractors.

For additional information:

• Click here to read my previous blog entry on the protest from February 2, 2010.
• Click here to read an update story from TCPalm on the plans to re-advertise the project.

Legislative Hearings for the Week of Feb. 22, 2010

Steve Goldblatt, recently retired, longtime University of Washington Construction Management faculty member specializing in design and construction law, has been covering the legislative scene in Olympia for more than 25 years.

I've invited Steve to contribute a series of guest blog posts on bills under consideration in the Washington State Legislature relating to public works and contracting, architects/engineers, and contractors. 

In this entry, Steve summarizes bills that will receive a hearing in Olympia for the week of February 22, 2010, and which have all passed at least one house this year.

Wastewater Treatment Systems Designers: SHB 2589 would modify licensing provisions for on-site wastewater treatment systems designers (Chapter 18.210 RCW), including experience and experience verification requirements. This substitute bill passed out of the House two weeks ago, 95-2. Hearing on Monday, February 22, 2010, at 10:00 a.m. in the Senate Committee on Labor and Commerce and Consumer Protection.

Electrical Trainee Classroom Training: SHB 2546 would require electrical apprentices and trainees to take 48 hours of approved classroom training biennially (RCW 19.28.161). This substitute bill passed out of the House two weeks ago, 58-37. Hearing on Tuesday, February 23, 2010, at 1:30 p.m. in the Senate Committee on Labor and Commerce and Consumer Protection.

L&I Electrical Subpoenas: SHB 2555 would authorize Labor and Industries to issue subpoenas to enforce Chapter 19.28 RCW. This substitute bill passed out of the House two weeks ago, 96-0. Hearing on Tuesday, February 23, 2010, at 1:30 p.m. in the Senate Committee on Labor and Commerce and Consumer Protection.

Underground Economy Subpoenas: SHB 2789 would authorize subpoenas for investigations of underground economic activities by Labor and Industries (RCW 51.04.040), Employment Security (RCW 50.12.130), and Revenue (Chapter 82.32 RCW). This substitute bill passed out of the House a week ago, 98-0. Hearing on Tuesday, February 23, 2010, at 1:30 p.m. in the Senate Committee on Labor and Commerce and Consumer Protection.

Off-Site Prefabrication: EHB 2805 would require—on public works projects estimated to cost over $1 million—contractors to submit lists of specified information regarding certain prefabricated items produced outside WA to the awarding agency and General Administration  (Chapter 39.04 RCW). This engrossed bill passed out of the House a week ago, 54-43, after a striking amendment removed the requirement to submit certified payroll records, the prevailing wage penalties, and the enforcement authority of Labor and Industries. The more prescriptive version of the bill (EHB 1836) was defeated in the Senate last session when it failed to receive the necessary majority by a single vote. Hearing on Tuesday, February 23, 2010, at 1:30 p.m. in the Senate Committee on Labor and Commerce and Consumer Protection.

Capital Assets Inventory: HB 2848 would repeal the requirement (RCW 36.32.210) for county commissioners to annually submit an inventory of all capitalized assets to the county auditor. This bill passed out of the House two weeks ago, 96-0. Hearing on Thursday, February 25, 2010, at 1:30 p.m. in the Senate Committee on Government Operations and Elections.

Price Increases After Feb. 22nd for "Writing Effective Technical Specifications" Class

I will be teaching a 6 hour class on Wednesday, March 3, 2010 in Vancouver, Washington on "Writing Effective Technical Specifications."

Cost:

• $100 if registered by February 22, 2010
• $125 for registrations after February 22, 2010

For more information and to register:

• http://www.mpurdyvancouver.eventbrite.com (for payment by credit card)
  
• http://www.mpurdy.com/vancouverclass.pdf (for payment by check)

Follow-up on Whether RFPs Should Invite Exceptions

On February 11, 2010, I posted a blog entry on whether RFPs should contain language inviting proposers to take exceptions to requirements of the RFP.

Proponents on Both Sides:  I heard from some who agreed that such language should not be included in RFPs and that to do so puts the integrity of the whole selection process at risk.  But I also heard from others who argued that the whole intent of an RFP was to obtain the most creative and competitive solutions to an agency's stated problem or need, and that proposers should be encouraged to think outside of the box.

Restricting Exceptions to Scope of Work Approach:  Clearly, creativity in responses should be encouraged.   That's why an RFP is a Request for "Proposals." However, I think the key to maintaining the integrity of the selection process is in what is actually stated in the RFP.  Encouraging exceptions to the RFP should be restricted to the scope of work as proposed by the public agency, and should not be so broad as to invite proposers to take exception to the process, the evaluation criteria, or other factors.  In addition, the RFP must state how variations from the scope of work as articulated in the RFP will be evaluated.

Suggested Language:  Here's some quick language that preserves the integrity of the competitive selection process, while at the same time encourages genuine "proposals" that put forth creative solutions:

"In responding to this RFP, proposers must provide all of the information requested, and comply with all of the procedural requirements of the RFP. The public agency encourages proposers to submit proposals that creatively and competitively address the programmatic objectives and scope of work outlined in the RFP.  Proposers should note that one of the evaluation criteria described elsewhere in this RFP states that the public agency will award up to ___ points for how effectively, efficiently, and creatively the proposer submits a proposal that meets the public agency's objectives."

Balancing Transparency and Creativity:  This suggested language, which can certainly be improved upon for a specific project, avoids language that invites proposers to take "exceptions" to any portion of the RFP, and instead positively notes that points will be awarded for creativity in responses.  This language also avoids permitting proposers to take exception to processes and other elements of the RFP, restricting variations to different approaches in meeting the programmatic objectives and the scope of work.  On the whole, I think language like this can help meet both the objectives of maintaining a clear and transparent selection process, while at the same time encouraging creativity in responses.

Results of the Blog Poll:  For the last week, I included a poll on my blog asking whether exceptions language should be included in RFPs.  The results are now in: 50% voted "no" and 50% voted "yes."  The response rate to the poll, however, was low.  Only four people voted.

Claims & Changes Workshop

Claims & Changes Workshop:  Fundamentals of Claim/Change Order Preparation

When:  Thursday, April 29, 2010 (7:00 a.m. to 11:30 a.m.)

Where:  Renton, Washington (Maplewood Greens, 4050 Maple Valley Hwy)

Cost:  $148

Sponsored by and for more information:  Construction Seminars NW LLC

Topics include:

• The First Signs of a Problem
• Monitoring the Work - Time and Money
• Key Areas of Cost Recovery - Damages
• Communication - Proper and Timely Notifications
• Resolution Options and Strategy (Protection versus Cooperation)
• Understanding Delay and Disruption (Problems and Solutions)
• The Preparation Process - Equitable Adjustment Request or Claim
• Presentation of an Equitable Adjustment Request (EAR) or Claim
• Warning from the Past - Learn from Others Experience (both the Good and Bad)
• Examples of Successful Claim Recoveries - Why and How
• Proper Record Keeping and Documentation

Speakers include:

• Todd Henry (Oles Morrison Rinker & Baker LLP)
• Roger Brown (R Brown Consulting)
• Joe Schneid (AKT - CPAs and Business Consultants)
• Phil Martinson (Phil Martinson Engineering, Inc.)

NIGP (WA) Purchasing Summit on March 18, 2010

The Washington State Chapter of the National Institute of Governmental Purchasing (NIGP) will hold a Purchasing Summit on March 18, 2010 in Bellevue, Washington.

Subject:  We Can Make Change:  Identifying specific areas in each type of agency (cities, counties, education, special districts) to change for the 2011 Legislative session.

Cost:

• Free (chapter members)
• $30 (non-chapter members)

For more information and to register, visit www.wanigp.org

The Future of Bidder Responsibility Criteria

I spoke on Wednesday night at the monthly meeting of the Utility Contractors of Washington (UCAW).  

My topic was: "Bidder Responsibility Criteria: Balancing the Interests of Owners and Contractors."

Many contractors are concerned with how some public agencies are using bidder responsibility criteria and implementing the provisions of RCW 39.04.350.  In response to these concerns, the Capital Projects Advisory Review Board (CPARB) voted on February 11, 2010 to establish a Task Force on Bidder Responsibility.  Because of my involvement with the 2007 legislation establishing bidder responsibility requirements, and writing CPARB's Suggested Guidelines for Bidder Responsibility, I have an ongoing interest in this subject and ensuring that both contractors and public agencies have a common understanding on how to develop and use the criteria.  I will be serving as a member of the newly established task force.

As more public agencies begin using supplemental bidder responsibility criteria as part of the award process for public works projects, it is important that they understand how to implement and write effective criteria.  An encouraging note this week is that I was asked to provide training next month for a city who plans to begin using supplemental bidder responsibility criteria.  It's good to see public agencies take the implementation of the criteria seriously and seek assistance.

Below is outline of my talk to the Utility Contractors Association of Washington.  If you would like a copy of my PowerPoint presentation, please contact me and I will be glad to send it to you.

• What is Bidder Responsibility?
• Why is Bidder Responsibility Important?
• Bidder Responsibility Before 2007
• Bidder Responsibility Changes in 2007
• What are the Interests of Stakeholders?
• Is Bidder Responsibility Working?
• What Bidder Responsibility is NOT
• Abuses of Bidder Responsibility
• The Future of Bidder Responsibility
• Resources 

It you would like training or consulting assistance on implementing or responding to bidder responsibility criteria, please contact me. 

As always, please feel free to comment on your experiences with bidder responsibility.  I'm especially interested in hearing how those of you in other states are dealing with the issue.

Class on Public Works Contract Close-out is Full

The February 24, 2010 class in Everett, WA on "Public Works Contract Close-out: Bonding, Retainage, and Claims" is now FULL.

Please contact me if you would like to be notified of future offerings of this class, or if you would like me to conduct the class in your geographic area, or for your agency.

San Diego Residents to Vote on Banning Project Labor Agreements

San Diego County residents will vote on June 8, 2010 whether to ban the use of Project Labor Agreements (PLA) on future county public works projects.  The San Diego County Board of Supervisors voted on February 9, 2010 to draft language to amend the county's charter and place the measure before the voters.

For more information, read the article in the San Diego County News.

Veteran-owned Business Legislation Marching Forward

A bill introduced in the Washington State Legislature has been approved by a vote of 48 to zero in the State Senate.  Engrossed Senate Bill (ESB 5041) would affect state agencies in the award of contracts to veteran-owned businesses.  

Under the legislation, "state agencies are encouraged to award three percent of all procurement contracts that are exempt from competitive bidding requirements under RCW 43.19.1906 (2)" to businesses to be certified by the Department of Veterans Affairs as being at least 51% owned and controlled by veterans or active or reserve members of the U.S. military.   

RCW 43.19.1906 (2) addresses competitive exemption requirements for the purchase of goods and supplies.  State agencies would also be required to perform outreach to veteran-owned businesses to increase contracting opportunities for them. 

The 3% goal would would also presumably apply to public works and personal service contracts, although from my reading the bill is not clearly drafted.  When including public works and personal service contracts, it refers back to the requirements of RCW 43.19.1906 (2) which appear to only apply to goods and supplies.

A hearing has been scheduled before the House Committee on State Government and Tribal Affairs for February 18, 2010 at 8:00 a.m.

Legislative Hearings This Week

Steve Goldblatt, recently retired, longtime University of Washington Construction Management faculty member specializing in design and construction law, has been covering the legislative scene in Olympia for more than 25 years.

I've invited Steve to contribute a series of guest blog posts on bills under consideration in the Washington State Legislature relating to public works and contracting, architects/engineers, and contractors. 

In this entry, Steve summarizes two bills that will receive a hearing in Olympia for the week of February 15, 2010, and which have both passed at least one house this year.

Architects: ESSB 5529 would update the Architects Act (Chapter 18.08 RCW) for the first time since 1985 to reflect modern practices by modifying applicants' requirements, exam procedures, practice exemptions, professional development, business entity registration, and out-of-state firm requirements. The bill passed the Senate last week, 39-8. Hearing on Wednesday, February 17, 2010, at 1:30 p.m. in the House Committee on Commerce and Labor.

Alternative Public Works Contracting: HB 1690 would clarify legislative intent regarding the use of alternative public works contracting procedures (Chapter 39.10 RCW), require the University of Washington Board of Regents to comply with those procedures and to seek the approval of the Capital Projects Advisory Review Board (CPARB) before using new procedures, and direct CPARB to evaluate new alternative contracting procedures and to authorize use of such new procedures as demonstration projects. The bill passed the House earlier this month, 97-0. Hearing on Thursday, February 18, 2010, at 3:30 p.m. in the Senate Committee on Government Operations and Elections.

Connecticut Auditor Urges Elimination of Overly Broad Exemption for Competitive Selection

The State of Connecticut's Auditor of Public Accounts has urged the General Assembly to eliminate an overly broad exemption available to state agencies in the selection of firms for personal service agreements with a cost more than $20,000.

Connecticut law [Section 4-215 subsection (a)] lists a number of exemptions available to state agencies.  It also authorizes the state's Office of Policy and Management (OPM) to develop additional exemption criteria.  One of the additional exemption criteria established provides for a waiver of competition for "services that require a contractor that has special capabilities or experience."

The auditor noted in their 2009 annual report to the General Assembly that this additional exemption "is an often-used condition for granting waivers from competitive bidding" and that it has the impact of limiting competition.  

The auditor recommended that the General Assembly limit exemptions to only the following criteria specified in state law:

1. Services for which the cost to the state of a competitive selection procedure would outweigh the benefits of such procedure, as documented by the state agency.
2. Proprietary services.
3. Services to be provided by a contractor mandated by the general statutes or a public or special act.
4. Emergency services, including services needed for the protection of life or health.

Mike Purdy Speaks on Bidder Responsibility

I will be speaking on "Bidder Responsibility Criteria: Balancing the Interests of Owners and Contractors" on Wednesday, February 17, 2010 at the dinner meeting of the Utility Contractor's Association of Washington (UCAW).

Development and use of supplemental bidder responsibility criteria, as authorized by RCW 39.04.350 is becoming an increasingly hot issue in the State of Washington as many government agencies are publishing criteria for projects that are overly restrictive or highly subjective.  Contractors are concerned that the intent of the law is not being met.

In my speech, I will lay out some of the principles around how bidder responsibility criteria are supposed to function, provide examples of problems that have arisen, and offer comments on how owners and contractors can to work together to find common ground on this important subject.

For more information and to register, visit the website of the Utility Contractor's Association of Washington.

If you have specific questions about supplemental bidder responsibility criteria, please contact me.

Should Proposers Be Encouraged to Take Exceptions to RFP?

RFP Language:  I recently came across the following language in a Request for Proposals (RFP) from a public agency:

"Any exception to an item in the solicitation must be clearly set out and fully explained in the proposal as to why the proposer is taking exception.  Be specific as to the reasons for the exception."

The Question:  Should proposers be encouraged to take exceptions to the provisions of an RFP in their proposals? 

Short Answer:  No.  It seems to me that to invite proposers to take exception to the terms of the RFP and the process is not a good contracting practice, and makes it very difficult to fairly compare and evaluate proposals.

Use Same Requirements for All:  Public agencies should be evaluating all firms on the same evaluation criteria and requirements, which are outlined in the RFP.  All firms should be competing on an equal footing, based on the same requirements.  

Handling Objections:  Proposers have the opportunity to raise concerns about the provisions of the RFP prior to the deadline for submission of proposals, and a public agency has the option of issuing an addendum if they agree with the concerns.  In addition, if any of the requirements of the RFP are unacceptable to a prospective proposer, they may choose not to submit a proposal.

Define Business Needs:  An RFP should define the business needs of the public agency, and not permit proposers to define the agency's business needs through exceptions.  If a proposer is unable to meet those business needs, their proposal should receive lower scores in the evaluation process.

Public vs. Private Sectors:  In a private sector RFP, inviting proposers to take exception to provisions may be an acceptable practice since the private sector is not under the same solicitation and selection constraints and procedures as a public agency.  In the public sector, all proposals should be evaluated against the same standards.

What Does Your Agency Do?  Vote in the poll on the right hand side of this blog.  Does your agency encourage proposers to take exceptions to the provisions of Requests for Proposals (RFPs)?

Miscellaneous Trainings and Seminars

Here are 8 seminars and training opportunities that may be of interest:  I will be speaking at four of these events.

• Bidder Responsibility Criteria: Balancing the Interests of Owners and Contractors.  February 17, 2010, 6:00 p.m. to 8:30 p.m., Lynnwood Convention Center in Lynnwood, WA.  Sponsored by Utility Contractors Association of Washington.  Speaker:  Mike Purdy.
  
  
• Alaskan Way Viaduct.  February 18, 2010, 5:30 p.m. to 8:00 p.m., Rock Salt Steak House in Seattle.  Sponsored by the Pacific Northwest Chapter of the Construction Management Association of America (CMAA).
  
  
• Public Works Contract Close-out: Bonding, Retainage, and Claims.  February 24, 2010, 10:00 a.m. to 3:00 p.m., Everett, WA.  Sponsored by Michael E. Purdy Associates.
  
  
• Innovative Contracting: Transportation Projects.  February 25, 2010, 7:15 a.m. to 9:00 a.m., Rainier Club in Seattle.  Sponsored by the Northwest Region of the Design-Build Institute of America (DBIA).
  
  
• Alternative Project Delivery of Capital Projects.  February 26, 2010,  7:30 a.m. to 4:30 p.m., Bellevue, WA.  Sponsored by the Pacific Northwest Chapter of the Construction Management Association of America (CMAA).  I will be speaking in the morning for 45 minutes on "Issues and Trends in Public Project Delivery."
  
  
• Writing Effective Technical Specifications.  March 3, 2010, 9:00 a.m. to 4:00 p.m., Vancouver, WA.  Sponsored by Michael E. Purdy Associates.
  
  
• Design-Build Seminar: The Future of Design & Construction.  March 4, 2010, 6:45 a.m. to 9:45 a.m., Maplewood Greens in Renton, WA.  Sponsored by Construction Seminars NW
  
  
• Construction Lien Law in Washington.  March 24, 2010, 8:00 a.m. 4:30 p.m., Crowne Plaza Hotel in Seattle.  Sponsored by Lorman Education Services

CPARB Meets on February 11, 2010

I will be heading to Olympia on Thursday morning (February 11, 2010) to listen to the discussion at the Capital Projects Advisory Review Board (CPARB) meeting.  

The agenda includes the following items which I will report on in a subsequent blog entries:

• Discussion of City of Tacoma's proposed Design-Build project.  In a January 20, 2010 letter to the City of Tacoma, CPARB stated that "there is a concern with how the Design-Build RFQ [for a parking garage] meets the requirements of RCW 39.10 for public works."  Representatives from the City of Tacoma have been invited to attend the meeting and discuss the project with CPARB.
  
• Report on use of Job Order Contracting in 2009
  
• Report from the Integrated Project Delivery/Best Value Task Force
  
• Legislative updates and discussion
  
• Identify task forces for 2010 work plan of CPARB.

Close-out Class Price Increases after Feb.15th

I will be teaching a 4 hour class on Wednesday, February 24, 2010 in Everett, Washington on "Public Works Contract Close-out:  Bonding, Retainage, and Claims."

Cost:

• $100 if registered by February 15, 2010
• $125 for registrations after February 15, 2010

For more information and to register:

• http://www.mpurdyeverett.eventbrite.com (for payment by credit card)
  
• http://www.mpurdy.com/everettclass.pdf (for payment by check)

Does Failure to Acknowledge Addenda Render a Bid Non-Responsive?

Question:  If a bidder fails to acknowledge all addenda issued for a project, does that automatically render their bid non-responsive?

Answer:  It all depends on the nature of the addenda they failed to acknowledge.  

If the addenda contain material terms that would impact the bidder's price, their understanding of the schedule or the project, then failure to acknowledge the addenda may be considered a material defect, and the bid should be rejected as non-responsive.  However, if the provisions of the addenda are not material, a public agency has the discretion to determine whether to reject the bid as non-responsive or not.  A key factor in determining the materiality of failing to acknowledge the addenda is whether it provides the bidder with an advantage not enjoyed by other bidders.

1st Example:  Suppose that two addenda were issued for a project.  The low bidder acknowledged receipt of the first addendum, but not the second one.  The second addendum changed the requirement for the Payment and Performance Bond from an amount equal to 25% of the award amount to 100% of the award amount.  Because the addendum contained provisions affecting the price of the bid (a 100% Payment and Performance Bond is arguably more expensive than a 25% Payment and Performance Bond), the bid should be rejected as non-responsive.

2nd Example:  If an addendum was issued with a revised bid form for the project and the low bidder failed to acknowledge the addendum, but submitted the revised bid form, it can be argued that the failure to acknowledge the addendum is an immaterial irregularity that should be waived.  After all, by submitting the revised bid form, it is clear that the bidder received the addendum and took its content into account in preparing the bid.

UW Seeks Contracts Administrator

Following my retirement on February 5, 2010 as the Contracts Manager at the University of Washington's Capital Projects Office, the University appointed Judy Giniger as the new Contracts Manager.  Judy was my Contracts Administrator at the UW for over a year.

The University of Washington has now advertised to fill the Contracts Administrator position that Judy formerly held.  

To view the online advertisement and position description for the Contracts Administrator position, click here. There is no closing date for this recruitment and it will remain open until filled.

Register for Close-out Class by Feb. 15th

I will be teaching a 4 hour class on Wednesday, February 24, 2010 in Everett, Washington on "Public Works Contract Close-out:  Bonding, Retainage, and Claims."

Cost:

• $100 if registered by February 15, 2010
• $125 for registrations after February 15, 2010

For more information and to register:

• http://www.mpurdyeverett.eventbrite.com (for payment by credit card)
  
• http://www.mpurdy.com/everettclass.pdf (for payment by check)

Federal Indictment in Chicago on MWBE Fraud

A certified minority- and woman-owned business in Chicago was indicted on charges of serving as a "pass-through" on more than $9.6 million of public contracts, work that federal investigators charge was not actually performed or supplied by Azteca Supply Co. but by firms owned by white men. 

To read more, visit the web page of the Chicago Sun-Times.

Will Budget Cuts Eliminate CPARB?

It appears that Washington State's Capital Projects Advisory Review Board (CPARB) may escape the budget ax that will fall on so many other state boards and commissions.

HB 2617 originally listed CPARB as one of the boards to be cut, but a substitute bill that passed out of the House Committee on State Government and Tribal Affairs on January 26, 2010 has CPARB removed from the hit list.  

In the Senate, the Senate Committee on Ways and Means will hold a public hearing on Monday, February 8, 2010 at 1:30 p.m. to consider the Senate companion bill, SB 6426, that does call for CPARB's elimination.  The staff report to SB 6426 discusses a Senate substitute bill and the report does not list CPARB as one of the boards to be eliminated.  The substitute bill will probably be available online sometime on February 8, 2010.

It appears that the House and Senate substitute bills are moving forward, and if approved, these will keep CPARB in existence.  CPARB has been a valuable forum for all members of the public construction community to discuss tools for ensuring fair, efficient, and equitable contracting practices.  Stay tuned for more updates.

Are Housing Authorities Exempt from State Law?

Over the last number of years, some housing authorities in the State of Washington have selected contractors and administered construction projects using alternative methods other than the traditional "Design-Bid-Build" approach, and not consistent with the alternative public works contracting laws in chapter 39.10 RCW that allows for General Contractor/Construction Manager (GC/CM), Design-Build, and Job Order Contracting approaches.  

Position of Housing Authorities:  Housing authorities have long maintained that their authorizing statute (RCW 35.82.070) provides authority for them to not comply with various state laws unless the Legislature specifically states that housing authorities are subject to those laws.  

Attorney General Opinion:  Last year, the Capital Projects Advisory Review Board (CPARB) requested and obtained a written opinion from the Washington State Attorney General's Office on the subject.  The Attorney General's Office concluded that housing authorities were only exempt from certain state laws in relationship to "the acquisition, operation, or disposition of property," but not with respect to construction, alteration, repair, improvement, or development.  The impact of the opinion was to require housing authorities to comply with all of the provisions of chapter 39.10 RCW on alternative public works contracting, overturning a long practice by housing authorities.

CPARB Discussions:  At the December 10, 2010 CPARB meeting, after hearing from various housing authorities about challenges in complying with federal funding requirements and using the provisions of chapter 39.10 RCW, CPARB decided to not take action recommending that housing authorities be added to the definition of "public body" in chapter 39.10 RCW.  Click here to read CPARB's minutes with a more detailed discussion of this issue.

Legislation to Exempt Housing Authorities:  HB 2517, which was promoted by the Association of Washington Housing Authorities (AWHA), would clarify and expand the exemption for housing authorities from various state laws to include "construction, alteration, repair, improvements" unless specifically stated in state law.

Substitute HB 2517, which was approved on February 1, 2010 by the House Local Government and Housing Committee, would more narrowly restrict the exemption for housing authorities than stated in HB 2517, and subject them to the provisions of chapter 39.10 RCW except "where alternative requirements or procedures of federal law or federal regulation are authorized."  On February 3, 2010, the Senate Committee on Financial Institutions and Housing & Insurance approved SSB 6327, with the same provisions as SHB 2517.

SHB 2517 and SSB 6327 would also subject housing authorities to state prevailing wage requirements (chapter 39.12 RCW) unless specifically preempted by federal law or regulation.  WAC 296-127-025 (1) already recognizes that certain federal regulations preempt state prevailing wage requirements.  For certain HUD funded projects, federal regulations currently (CFR Title 24, Section 965.101) preempt state prevailing wage rates.

Mike Purdy Retires on February 5, 2010

Friday, February 5, 2010 will mark my last day as the Contracts Manager at the University of Washington, as I retire after more than 30 years as a manager in public contracting.  Prior to the University of Washington, I was the contracting manager for both the City of Seattle and the Seattle Housing Authority. 

In my retirement, I plan to remain active in contracting issues in the state and nationally through my consultant business, Michael E. Purdy Associates.  I will consult with and advise government agencies, contractors, and consultants, as well as provide frequent training.  I will also continue to maintain Mike Purdy's Public Contracting Blog.

I also have plans in my retirement to pursue some writing projects I have dreamed of for a long time, starting with a book on U.S. presidential history.

My life has been enriched over these last 30 years of working with so many dedicated, talented, and compassionate professionals, and in developing many good friendships, and I look forward to continuing with these relationships.

Here's to the next 30 years!  You'll still be hearing from me!

Register for Mike Purdy's Spec Writing Class

Register now for this popular class to save a place, and save on the registration fee.
 
I will be sponsoring and teaching a 6 hour hands-on, interactive training workshop on "Writing Effective Technical Specifications."

When and Where: March 3, 2010 (9:00 a.m. to 4:00 p.m.) in Vancouver, Washington

Cost:

• $100 if registered by February 22nd
• $125 for registrations after February 22nd
  

Register Now:

• Online at http://mpurdyvancouver.eventbrite.com (credit card), or
• Fill out Registration Form available at http://www.mpurdy.com/vancouverclass.pdf (check)

Instructor: Mike Purdy

Comments from Previous Attendees at this Class:

• "Good knowledge of the material"
• "Great demeanor.  Made you feel comfortable.  Very knowledgeable."
• "Learned a lot I did not know that will help me in the future with writing specs."
• "Style of instructor promoted interaction with class.  Enjoyed the class.  Felt like I learned quite a bit."
• "Clear presentation of material."
• "Very easy to list to.  Informative."
• "Liked the examples and breaking off into groups to write specs."
• "Mike presented the material very well, and I walked out of class with tons of new and usable knowledge."

Class Description: Well-written technical specifications can make a difference in the success of a public works project, and are especially important in the event of contract disputes. Whether you write specifications or review specs prepared by others, this hands-on, interactive class will cover key principals to consider in writing and reviewing technical specifications.

Agenda:

• State Law Requires Specifications
• Why Good Specifications Are Important
• Tips in Writing Specifications
• Tips of What NOT to Write
• Sources of Specification Language
• Types of Specifications
• Interpretation of Specifications
• Warranties
• Tools for Obtaining Qualified Contractors and Subcontractors
  

Attendee List: Visit http://www.mpurdy.com/vancourverlist.pdf for a list of who has registered

Questions - contact me at:

• (206) 295-1464
• http://www.mpurdy.com/contact