Prequalification Process / Subcontract Lisa Conomy Construction Counsel, OSU Lane Beougher State Architect

Prequalification of Subcontractors Presentation will cover: Rule Criteria Process Evaluation of Lower-Tier Subcontractors Self-Performed Work

Prequalification of Subcontractors Rule CMR or DB shall establish criteria for pre- qualification of prospective subcontractors Criteria shall be consistent with rules adopted by DAS

Prequalification of Subcontractors Rule Criteria shall be subject to approval of public authority involved in project (approved prequalification criteria will be used for any future bidder’s responsibility analysis)

Prequalification of Subcontractors CMR or DB will place the establishment of prequalification criteria on project schedule For each subcontract, CMR or DB shall identify at least 3 prospective bidders that are prequalified to bid

Prequalification of Subcontractors CMR or DB shall identify fewer than 3 (to satisfaction of public authority) if 3 prequalified bidders are not available Public authority shall verify that each prospective subcontractor meets the prequalification criteria

Prequalification of Subcontractors Once prospective subcontractors are prequalified & found acceptable, CMR or DB shall solicit proposals from each of these subcontractors

Prequalification of Subcontractors Solicitation & selection of a subcontractor shall be conducted under an “open book pricing method”

Prequalification of Subcontractors Open Book Pricing Method CMR: same meaning as in ORC 9.33 “method in which CMR provides the public authority, upon request, all books, records, documents, and other data pertaining to the bidding, pricing, or performance of a CM contract awarded to CMR”

Prequalification of Subcontractors Open Book Pricing Method (cont’d): DB: same meaning as in ORC153.6 “method in which DB provides the public authority, upon request, all books, records, documents, contracts, subcontracts, purchase orders, and other data pertaining to the bidding, pricing, or performance of a contract for DB services awarded to DB”

Prequalification of Subcontractors Any self-performed work by CMR or DB, if allowed by public authority, shall have the same criteria as the other prospective subcontractors

Prequalification of Subcontractors CMR or DB shall not be required to award a subcontract to a low bid CMR or DB to use the subcontract form, prescribed by DAS, when entering into a subcontract

Prequalification Criteria Established criteria shall include the prospective bidders: Experience Financial condition Conduct & performance on previous contracts

Prequalification Criteria Established criteria (cont’d) Management skills Ability to execute subcontract properly

Prequalification Criteria Established criteria shall also: Further any goals set as part of an EDGE or diversity and inclusion programs required by public authority or by applicable law

Prequalification Criteria Established criteria shall also (cont’d) Require that prospective bidders have not violated any affirmative action program during the last 5 years (per ORC 9.47, a prospective bidder may meet this requirement by submitting a valid certificate of compliance with affirmative action programs)

Prequalification Criteria Require prospective bidders to submit proof of current licenses to perform work as required by public authority or applicable law CM or DB to include any additional criteria for specific subcontracts required by public authority that are consistent with the scope and needs of project

Prequalification Process CMR or DB shall complete the subcontractor prequalification process for each subcontract no later than 30 days before the intent to solicit bids for that subcontract

Prequalification Process During the process, the CMR or DB shall develop “bidders” interest in project, including those prospective subcontractors the public authority asked the CM to contact.

Prequalification Process To reach prospective subcontractors, CMR or DB may place a notice on the official website of the public authority or other appropriate websites.

Prequalification Process During the process, the CMR or DB shall issue requests for qualifications to prospective subcontractors, and as appropriate forward any questions to the A/E or A/E of Record.

Prequalification Process CMR or DB shall accept for evaluation the qualifications timely submitted by any prospective bidder.

Prequalification Process CMR or DB shall evaluate all the qualifications that have been submitted and notify each of the prospective subcontractors of whether they are qualified

Prequalification Process CMR or DB shall submit names & qualifications of all the qualified prospective subcontractors to public authority (fewer than 3 names can be submitted if it is substantiated that fewer than 3 are available)

Prequalification Process Public authority, A/E and CMR or DB may meet to review qualifications of prospective subcontractors on list Public authority shall verify that prospective subcontractors on list do meet the prequalification criteria

Prequalification Process Public authority may eliminate any prospective subcontractor it determines is not qualified. CMR or DB shall notify the prospective subcontractor, in writing, of the decision to eliminate them

Prequalification Process If CMR or DB receives written objection from eliminated prospective subcontractor within 5 days after notification is received, CMR or DB shall deliver written objection to public authority. Public authority may respond to objection in writing through CMR or DB.

Subcontract Bidding Process CMR or DB shall create a bid package for each subcontract & solicit bids from the qualified prospective subcontractors in accordance with construction schedule but no later than 60 days before work under that bid package is scheduled to begin

Subcontract Bidding Process During the process, the CMR or DB shall issue bidding documents, conduct pre-bid conferences, forward appropriate questions to A/E, assist A/E with preparation of addenda, receive all bids, prepare bid analysis, conduct pre-award conferences & report information to public authority

Subcontract Bidding Process At completion of process for each subcontract & no later than 25 days before work is scheduled to begin, the CMR or DB & public authority will meet to review bids and determine to which subcontractor(s) an award will be made

Subcontract Bidding Process During review meeting, public authority may reject a proposed subcontractor as non- responsible

Subcontract Bidding Process Each subcontractor being considered for an award shall be qualified to perform the subcontracted work and have submitted a bid which conforms to the requirements of the contract documents

Subcontract Bidding Process If no proposed subcontractor is rejected, CMR or DB shall enter into the subcontract with accepted subcontractor

Subcontract Bidding Process CMR or DB shall prepare all Subcontracts which shall incorporate the General Conditions & be on the Subcontract Form prescribed in OAC 153:

Subcontract Bidding Process CMR or DB shall prepare all Subcontracts which shall incorporate the General Conditions & be on the Subcontract Form prescribed in OAC 153: All Subcontracts will be between CMR or DB and the respective Subcontractors

Subcontract Bidding Process No less than 10 days before work is to begin, CMR or DB shall submit a Subcontractor & Material Supplier Declaration form for approval If a proposed subcontractor is rejected, CMR or DB shall propose another subcontractor

Subcontract Bidding Process CMR or DB shall not be entitled to any adjustment of contract sum, contract time, or both on account of public authority’s rejection of a proposed subcontractor as non-responsible

Evaluation of Lower-Tier Subcontractors Lower-Tier Subcontractor is defined as any subcontractor not in privity with the CMR or DB No less than 10 days before work is to begin by any lower-tier subcontractor, CMR shall submit to A/E a Subcontractor and Material Supplier Declaration form (DB shall submit to public authority)

Evaluation of Lower-Tier Subcontractors A/E shall verify completeness of form and forward to public authority If public authority rejects any proposed lower-tier subcontractor, CMR or DB shall propose a replacement at no additional cost

Self-Performed Work CMR or DB (or affiliated entity) can bid to perform Work with its own employees subject to the following: Notify public authority of their intent to bid on portion of work

Self-Performed Work Public authority shall review that Work & agree on its scope before finalization of subcontracting plan At least 14 days before issuing bid documents for the Work, seek public authority’s permission to bid

Self-Performed Work If public authority grants permission, the following applies: CMR or DB shall meet, in all respects, the bidder pre-qualification criteria

Self-Performed Work Bidding documents shall specifically state that a self-perform bid my be submitted CMR or DB shall ensure strict separation of personnel involved in bidding from project personnel. Communication between these groups is prohibited until after bid is opened

Self-Performed Work General conditions apply to self-performed work no different than other subcontracted work All requirements applicable to other subcontractors apply to self-performed work

Self-Performed Work Sealed Bid for self-performed work shall be submitted to public authority no less than 48 hours before the deadline for all other bids for same work are submitted to CMR or DB

Self-Performed Work If self-performed bid is submitted and less than 2 other bids are received, public authority may require a rebid

Self-Performed Work If self-performed work is awarded, CMR or DB may not use CM Contingency for that work. This prohibition applies specifically, but not exclusively, to using contingency to make-up for underestimation of that scope of work by CMR or DB

Self-Performed Work Self-Performed work will be considered a subcontract and will be on same subcontract form as all other subcontracts

Prequalification Process/Subcontract Questions: Lisa Conomy Construction Counsel Lane J. Beougher State Architect

Academy Wrap Up Craig Weise Construction Reform Program Director