Training: Developing and Managing RFPs and RFQs

I will be teaching an all day class on Wednesday, June 9, 2010 in Everett, Washington on "Developing and Managing RFPs and RFQs."

The class is sponsored by the Washington State Transportation Training Coalition.  Most of the attendees are from local transit agencies.  There are, however, still 9 spaces available if you are interested in registering. The cost is $75 for non-members of the Coalition, and $50 for members.

Class Description:  Here's a brief summary of the class.

Use of a Request for Proposals (RFPs) and Request for Qualifications (RFQs) requires a different mindset and skills than managing an invitation to bid, where selection is based solely upon price.  This class will provide an overview of the process, requirements, strategies, risks, and tools to use in successfully developing and managing the selection of consultants, service providers, and vendors through an RFP and RFQ.  In addition to covering the selection process, we will discuss the differences between RFPs and RFQs, examine specific Federal Transit Administration (FTA) requirements, and consider strategies and tools to manage the negotiation and contracting process.  We will examine how to ensure your agency ends up selecting the right firm for each procurement that will result in the best value for your agency and the public. 

A Few Things You Will Learn:

•    How to tap into industry expertise to develop an effective scope of work
•    What provisions should be included in every RFP and RFQ
•    Risk management issues to address
•    Factors to consider in weighting qualifications versus price
•    How to develop evaluation criteria that meet your agency’s needs
•    Educating and managing your evaluation committee
•    Tips for managing the interview process with finalists
•    Promoting ethical behavior that avoids conflicts of interest
•    What information is confidential and what can be disclosed

For more information about the class or to register, visit the website of the Washington Transportation Training Coalition.  

If you have any questions about the class, or are interested in discussing me offering the class for your agency, please contact me.

Prevailing Wages on Federally Funded Projects

Most federally funded public works construction projects require the payment of federal prevailing wages.

There are some notable exceptions to pay attention to.

• Not all federal agencies require payment of federal Davis-Bacon prevailing wages:  For example, some grant funds from the Federal Emergency Management Agency (FEMA) are not subject to federal prevailing wages.  When an emergency occurs, a state or local agency must apply for FEMA reimbursement after the work has been performed.  Thus, at the time of the work being performed, a state or local agency does not know if federal FEMA funds will be approved.  FEMA recognizes this and requires the payment of state prevailing wages only on FEMA reimbursable projects.  Another exception to the applicability of federal prevailing wages is for some projects funded through the National Institutes of Health (NIH).

• Joint applicability of federal and state prevailing wages:  For most public works projects funded with federal funds, federal and state regulations require that contractors pay the higher of the two prevailing wages between the applicable federal and state prevailing wages.  One exception to this rule is that federal prevailing wage rates preempt state prevailing wages for certain funds from the U.S. Department of Housing and Urban Development (HUD).  Title 24, Section 965.101.

Practical Tip:  Make sure you read the terms of the federal grant to determine the applicability of federal prevailing wages.

Fraud in Chicago's Minority Contracting Program

The City of Chicago's Office of the Inspector General has issued an 80 page report on problems that have riddled the City's minority contracting program, where actual utilization of minority owned businesses is less than what has been reported.

The findings in the Office of the Inspector General's May 2010 report include the following:

• Investigations uncovered pervasive fraud and abuse of the program.  Fraudulent activity has included the participation of "front companies" that assert to be MWBE firms, but which are actually controlled by non-minority males, and the use of "pass-throughs" in which MWBE firms are awarded contracts, but the work is actually subcontracted out to non-MWBEs to perform.

• Actual payments to MWBEs are likely significantly lower than publicly reported statistics.  This is due to reports being based on awarded contracts and not on actual payments made to MWBEs.

• Problems with program administration.  The audit report claims that "the MWBE program is poorly administered and the administration cannot determine whether or not it is achieving its goals."

Recommendations:  The audit report recommends the following seven action steps to improve the MWBE program:

1. Track and report actual payments to MWBEs.
2. Increase cooperation between City departments to properly administer the program.
3. Require more detailed documentation of payments to MWBEs.
4. Consider directly paying subcontractors.
5. Clearly define and consistently apply MWBE regulations.
6. Increase resources for program administration.
7. Increase enforcement of penalties for non-compliance with MWBE commitments.

Revised Prevailing Wage Rules Proposed by Washington State

The Washington State Department of Labor and Industries (L&I) has published a notice of Proposed Rule Making to amend and update its prevailing wage regulations in chapter 296-127 of the Washington Administrative Code (WAC). 

L&I has scheduled public hearings to consider comments on the proposed changes.  The hearings will be held at L&I's offices in the cities noted below:

• June 28, 2010, Tumwater, 1:00 p.m.
• June 29, 2010, Tukwila, 10:00 a.m.
• July 1, 2010, Spokane, 10:00 a.m.

The following is a high level summary of just some of the many proposed changes.  Click here to review a track changes version of the proposed changes to the WAC.

• Public Works Definition:  Clarifies that the definition of public works is only "for the purposes of chapter 39.12 RCW."  This is a significant change.  Its impact would be to acknowledge that the definition of public work in the WAC only applies with respect to prevailing wage requirements, and not with respect to solicitation or other public works requirements.  This proposed change would recognize that there is a difference between what is a public work and what is subject to prevailing wages.

• Ordinary Maintenance Definition:  Deletes the frequency and type of activity that is the basis of ordinary maintenance, and limits the definition of ordinary maintenance to maintenance work performed by public agency employees.

• Wage Increases for Certain Work:  Requires that maintenance, service, and building service maintenance (janitorial) contracts covering more than one year include language providing for an update of the prevailing wages after the first year, with the costs of any increases being borne by the public agency.

• Journey-level Wage Rates Only:  Clarifies that only journey-level (not apprentice) wage rates must be included in bidding and contract documents.

• Supervisory Exemption from Prevailing Wages:  Changes the standard of when supervisors must be paid prevailing wages.  One of the current standards requires payment of prevailing wages to supervisory personnel who perform physical labor for more than 20% but less than 50% of the hours in any week.  The proposed revision would require payment of prevailing wages to any supervisory personnel who perform physical labor for more than 10% of their hours on any day.

• Owner Exemptions from Prevailing Wages:  In addition to the existing standards relating to sole owners, partnerships, and corporations, the proposed revisions add "limited liability companies,"  (LLC) requiring that any member of an LLC who owns at least 30% is exempt from payment of prevailing wages.

• Requirements for Exempt Owners:  Formalizes existing L&I policy that exempt owners are only exempt from payment of prevailing wages, but must comply with other prevailing wage requirements, including the requirement to file a Statement of Intent to Pay Prevailing Wages and an Affidavit of Wages Paid.

I will be reviewing and commenting on the proposed revisions, and hope to attend the public hearing on June 28, 2010 as well.

Let me know if you have any questions or concerns about the revisions proposed by L&I.ww.lni.wa.gov/LawRule/WhatsNew/Proposed/default.asp?RuleID=283553.

Training: Risk Management for Complex U.S. Government Contracts and Projects

Training:  Risk Management for Complex U.S. Government Contracts and Projects

When:  Tuesday, June 8, 2010 (8:00 a.m. to 5:00 p.m.)

Where:  University Place, Washington (near Tacoma) - Pierce County - Chambers Creek, 9850 64th St. W.)

Cost: $425

Sponsored by:  National Contract Management Association (NCMA) - South Sound and Puget Sound Chapters

Speakers:

• Charles Rumbaugh
• Janice Smets

For more information and to register, visit NCMA's website.

School Districts Fail to Conduct Federal Debarment Checks

If you receive any federal funding for projects for your agency, remember that you are required to verify that the party you are contracting with has not been debarred or suspended by the Federal government.  This requirement applies for any contract exceeding $25,000.

Three school districts in Washington State were the subject of recent audit findings by the State Auditor's Office for failing to either obtain a debarment and suspension certification from vendors, or to check and maintain documentation in the contract file that they had checked the government's online debarment database: www.epls.gov.

Click on the links below to read the audit findings:

• Pomeroy School District No. 110
• Sunnyside School District No. 201
• Lake Quinault School District No. 97

Completed Training on Construction Bonds

I was in Everett, Washington on Tuesday, May 25, 2010 and in Yakima, Washington on Wednesday, May 26, 2010 teaching on Construction Bonds.

Here's the agenda of what I covered in this two hour class sponsored by APWA-MRSC:

• How Do Bonds Work?
• How Are Bonds Different From Insurance?
• Definitions
• What is a Power of Attorney
• Bid Bonds
• Performance Bonds
• Payment Bonds
• Retainage Bonds
• Warranty Bonds
• Contractor Registration Bonds