Sunday, June 6, 2010

New Law on Subcontractor Selection on GC/CM Projects

An alternative process for selecting mechanical and electrical subcontractors on GC/CM (General Contractor/Construction Manager) projects in Washington State will become effective on June 10, 2010, and mirrors closely how public agencies are required to select GC/CMs.  

Qualifications and Price-Based Selection:  Under the provisions of Senate Bill 6401 approved by the Washington State Legislature, selection of these key subcontractors would be based partially on qualifications and partially on their prices for their fee (overhead and profit) and fixed costs for specified general conditions work.  The concept permits the early selection of mechanical and electrical subcontractors in order to create a tighter working partnership between the GC/CM, the owner, and the subcontractors.

Options for Subcontractor Selection:  The default position for GC/CMs to select subcontractors is for them to be competitively bid under the provisions of RCW 39.10.380 after negotiation of the Maximum Allowable Construction Cost (MACC) between the owner and the GC/CM.  There are two other alternatives available under RCW 39.10.370 for early subcontract bidding by the GC/CM.  SB 6401 adds a fourth subcontractor selection process.

Additional Information:
  • I've developed a summary of the four options for subcontractor selection under GC/CM, as well as an outline of the provisions of SB 6401 that permits the selection of mechanical and electrical subcontractors on the basis of qualifications and price.  Click here to read this five page document.

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