BILL REQ. #:  S-0358.3 

Read first time 01/21/09.   Referred to Committee on Government Operations & Elections.

     AN ACT Relating to alternative public works; amending RCW 39.10.230, 39.10.250, 39.10.270, 39.10.300, 39.10.330, 39.10.360, and 39.10.420; and repealing RCW 39.10.310.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

Sec. 1   RCW 39.10.230 and 2007 c 494 s 103 are each amended to read as follows:
     The board has the following powers and duties:
     (1) Develop and recommend to the legislature policies to further enhance the quality, efficiency, and accountability of capital construction projects through the use of traditional and alternative delivery methods in Washington, and make recommendations regarding expansion, continuation, elimination, or modification of the alternative public works contracting methods;
     (2) Evaluate the use of existing contracting procedures and potential future use of other alternative contracting procedures including competitive negotiation contracts;
     (3) Develop guidelines to be used by the committee for the review and approval of design-build demonstration projects that procure operations and maintenance services;
     (4) Appoint members of the committee; and
     (((4))) (5) Develop and administer questionnaires designed to provide quantitative and qualitative data on alternative public works contracting procedures on which evaluations are based.

Sec. 2   RCW 39.10.250 and 2007 c 494 s 105 are each amended to read as follows:
     The committee shall:
     (1) Certify, or recertify, public bodies for a period of three years to use the design-build or general contractor/construction manager, or both, contracting procedures for projects with a total project cost of ten million dollars or more;
     (2) Review and approve the use of the design-build or general contractor/construction manager contracting procedures on a project by project basis for public bodies that are not certified under RCW 39.10.270; ((and))
     (3) Review and approve the use of the general contractor/construction manager contracting procedure by certified public bodies for projects with a total project cost under ten million dollars;
     (4) Review and approve not more than ten projects using the design-build contracting procedure by certified and noncertified public bodies for projects that have a total project cost between two million and ten million dollars. Projects must meet the criteria in RCW 39.10.300(1). Where possible, the committee shall approve projects among multiple public bodies. In June 2010, the committee shall report to the board regarding the committee's review procedure of these projects and its recommendations for further use; and
     (5) Review and approve not more than two design-build demonstration projects that include procurement of operations and maintenance services for a period longer than three years.

Sec. 3   RCW 39.10.270 and 2007 c 494 s 107 are each amended to read as follows:
     (1) A public body may apply for certification to use the design-build or general contractor/construction manager contracting procedure, or both. Once certified, a public body may use the contracting procedure for which it is certified on individual projects with a total project cost over ten million dollars without seeking committee approval. The certification period is three years. A public body seeking certification must submit to the committee an application in a format and manner as prescribed by the committee. The application must include a description of the public body's qualifications, its capital plan during the certification period, and its intended use of alternative contracting procedures.
     (2) A public body seeking certification for the design-build procedure must demonstrate successful management of at least one design-build project within the previous five years. A public body seeking certification for the general contractor/construction manager procedure must demonstrate successful management of at least one general contractor/construction manager project within the previous five years.
     (3) To certify a public body, the committee shall determine that the public body:
     (a) Has the necessary experience and qualifications to determine which projects are appropriate for using alternative contracting procedures;
     (b) Has the necessary experience and qualifications to carry out the alternative contracting procedure including, but not limited to: (i) Project delivery knowledge and experience; (ii) personnel with appropriate construction experience; (iii) a management plan and rationale for its alternative public works projects; (iv) demonstrated success in managing public works projects; (v) ((demonstrated success in managing at least one general contractor/construction manager or design-build project within the previous five years; (vi))) the ability to properly manage its capital facilities plan including, but not limited to, appropriate project planning and budgeting experience; and (((vii))) (vi) the ability to meet requirements of this chapter; and
     (c) Has resolved any audit findings on previous public works projects in a manner satisfactory to the committee.
     (((3))) (4) The committee shall, if practicable, make its determination at the public meeting during which an application for certification is reviewed. Public comments must be considered before a determination is made. Within ten business days of the public meeting, the committee shall provide a written determination to the public body, and make its determination available to the public on the committee's web site.
     (((4))) (5) The committee may revoke any public body's certification upon a finding, after a public hearing, that its use of design-build or general contractor/construction manager contracting procedures no longer serves the public interest.
     (((5))) (6) The committee may renew the certification of a public body for one additional three-year period. The public body must submit an application for recertification at least three months before the initial certification expires. The application shall include updated information on the public body's capital plan for the next three years, its intended use of the procedures, and any other information requested by the committee. The committee must review the application for recertification at a meeting held before expiration of the applicant's initial certification period. A public body must reapply for certification under the process described in subsection (1) of this section once the period of recertification expires.
     (((6))) (7) Certified public bodies must submit project data information as required in RCW 39.10.320 and 39.10.350.

Sec. 4   RCW 39.10.300 and 2007 c 494 s 201 are each amended to read as follows:
     (1) Subject to the process in RCW 39.10.270 or 39.10.280, public bodies may utilize the design-build procedure for public works projects in which the total project cost is over ten million dollars and where:
     (a) The design and construction activities, technologies, or schedule to be used are highly specialized and a design-build approach is critical in developing the construction methodology or implementing the proposed technology; or
     (b) The project design is repetitive in nature and is an incidental part of the installation or construction; or
     (c) Regular interaction with and feedback from facilities users and operators during design is not critical to an effective facility design.
     (2) Subject to the process in RCW 39.10.270 or 39.10.280, public bodies may use the design-build procedure for parking garages, regardless of cost.
     (3) The design-build procedure ((also)) may be used for the construction or erection of preengineered metal buildings or prefabricated modular buildings, regardless of cost and is not subject to approval by the committee.
     (4) Except for utility projects and approved demonstration projects, the design-build procedure may not be used to procure operations and maintenance services for a period longer than three years. State agency projects that propose to use the design-build-operate-maintain procedure shall submit cost estimates for the construction portion of the project consistent with the office of financial management's capital budget requirements. Operations and maintenance costs must be shown separately and must not be included as part of the capital budget request.
     (5) Subject to the process in RCW 39.10.280, public bodies may use the design-build procedure for public works projects in which the total project cost is between two million and ten million dollars and that meet one of the criteria in subsection (1)(a), (b), or (c) of this section.
     (6) Subject to the process in RCW 39.10.280, a public body may seek committee approval for a design-build demonstration project that includes procurement of operations and maintenance services for a period longer than three years.

Sec. 5   RCW 39.10.330 and 2007 c 494 s 204 are each amended to read as follows:
     (1) Contracts for design-build services shall be awarded through a competitive process using public solicitation of proposals for design-build services. The public body shall publish at least once in a legal newspaper of general circulation published in, or as near as possible to, that part of the county in which the public work will be done, a notice of its request for qualifications from proposers for design-build services, and the availability and location of the request for proposal documents. The request for qualifications documents shall include:
     (a) A general description of the project that provides sufficient information for proposers to submit qualifications;
     (b) The reasons for using the design-build procedure;
     (c) A description of the qualifications to be required of the proposer including, but not limited to, submission of the proposer's accident prevention program;
     (d) A description of the process the public body will use to evaluate qualifications and finalists' proposals, including evaluation factors and the relative weight of factors and any specific forms to be used by the proposers;
     (i) Evaluation factors for request for qualifications shall include, but not be limited to, technical qualifications, such as specialized experience and technical competence; capability to perform; past performance of the proposers' team, including the architect-engineer and construction members; and other appropriate factors. Cost or price-related factors are not permitted in the request for qualifications phase;
     (ii) Evaluation factors for finalists' proposals shall include, but not be limited to, the factors listed in (d)(i) of this subsection, as well as technical approach design concept; proposal price; ability of professional personnel; past performance on similar projects; ability to meet time and budget requirements; ability to provide a performance and payment bond for the project; recent, current, and projected workloads of the firm; and location. Alternatively, if the public body determines that all finalists will be capable of producing a design that adequately meets project requirements, the public body may award the contract to the firm that submits the responsive proposal with the lowest price;
     (e) The form of the contract to be awarded;
     (f) The amount to be paid to finalists submitting responsive proposals and who are not awarded a design-build contract;
     (g) The schedule for the procurement process and the project; and
     (h) Other information relevant to the project.
     (2) The public body shall establish an evaluation committee to evaluate the responses to the request for qualifications based on the factors, weighting, and process identified in the request for qualifications. Based on the evaluation committee's findings, the public body shall select not more than five responsive and responsible finalists to submit proposals. The public body may, in its sole discretion, reject all proposals and shall provide its reasons for rejection in writing to all proposers.
     (3) Upon selection of the finalists, the public body shall issue a request for proposals to the finalists, which shall provide the following information:
     (a) A detailed description of the project including programmatic, performance, and technical requirements and specifications; functional and operational elements; minimum and maximum net and gross areas of any building; and, at the discretion of the public body, preliminary engineering and architectural drawings; and
     (b) The target budget for the design-build portion of the project.
     (4) The public body shall establish an evaluation committee to evaluate the proposals submitted by the finalists. Design-build contracts shall be awarded using the procedures in (a) or (b) of this subsection. The public body must identify in the request for qualifications which procedure will be used.
     (a) The finalists' proposals shall be evaluated and scored based on the factors, weighting, and process identified in the initial request for qualifications and in any addenda published by the public body. Public bodies may request best and final proposals from finalists. The public body shall initiate negotiations with the firm submitting the highest scored proposal. If the public body is unable to execute a contract with the firm submitting the highest scored proposal, negotiations with that firm may be suspended or terminated and the public body may proceed to negotiate with the next highest scored firm. Public bodies shall continue in accordance with this procedure until a contract agreement is reached or the selection process is terminated.
     (b) If the public body determines that all finalists are capable of producing a design that adequately meets project requirements, the public body may award the contract to the firm that submits the responsive proposal with the lowest price.
     (5) The firm awarded the contract shall provide a performance and payment bond for the contracted amount. The public body shall provide appropriate honorarium payments to finalists submitting ((best and final)) responsive proposals that are not awarded a design-build contract. Honorarium payments shall be sufficient to generate meaningful competition among potential proposers on design-build projects. In determining the amount of the honorarium, the public body shall consider the level of effort required to meet the selection criteria.

Sec. 6   RCW 39.10.360 and 2007 c 494 s 303 are each amended to read as follows:
     (1) Public bodies should select general contractor/construction managers early in the life of public works projects, and in most situations no later than the completion of schematic design.
     (2) Contracts for the services of a general contractor/ construction manager under this section shall be awarded through a competitive process requiring the public solicitation of proposals for general contractor/construction manager services. The public solicitation of proposals shall include:
     (a) A description of the project, including programmatic, performance, and technical requirements and specifications when available;
     (b) The reasons for using the general contractor/construction manager procedure;
     (c) A description of the qualifications to be required of the firm, including submission of the firm's accident prevention program;
     (d) A description of the process the public body will use to evaluate qualifications and proposals, including evaluation factors and the relative weight of factors;
     (e) The form of the contract, including any contract for preconstruction services, to be awarded;
     (f) The estimated maximum allowable construction cost; and
     (g) The bid instructions to be used by the general contractor/ construction manager finalists.
     (3) Evaluation factors for selection of the general contractor/construction (([manager])) manager shall include, but not be limited to:
     (a) Ability of the firm's professional personnel;
     (b) The firm's past performance in negotiated and complex projects;
     (c) The firm's ability to meet time and budget requirements;
     (d) The scope of work the firm proposes to self-perform and its ability to perform that work;
     (e) The firm's proximity to the project location;
     (f) Recent, current, and projected workloads of the firm; and
     (g) The firm's approach to executing the project.
     (4) A public body shall establish a committee to evaluate the proposals. After the committee has selected the most qualified finalists, at the time specified by the public body, these finalists shall submit final proposals, including sealed bids for the percent fee on the estimated maximum allowable construction cost and the fixed amount for the general conditions work specified in the request for proposal. The public body shall establish a time and place for the opening of sealed bids for the percent fee on the estimated maximum allowable construction cost and the fixed amount for the general conditions work specified in the request for proposal. At the time and place named, these bids must be publicly opened and read and the public body shall make all previous scoring available to the public. The public body shall select the firm submitting the highest scored final proposal using the evaluation factors and the relative weight of factors published in the public solicitation of proposals. A public body shall not evaluate or disqualify a proposal based on the terms of a collective bargaining agreement.
     (5) Public bodies may contract with the selected firm to provide services during the design phase that may include life-cycle cost design considerations, value engineering, scheduling, cost estimating, constructability, alternative construction options for cost savings, and sequencing of work, and to act as the construction manager and general contractor during the construction phase.

Sec. 7   RCW 39.10.420 and 2007 c 494 s 401 are each amended to read as follows:
     (1) The following public bodies are authorized to use the job order contracting procedure:
     (a) The department of general administration;
     (b) The University of Washington;
     (c) Washington State University;
     (d) Every city with a population greater than seventy thousand and any public authority chartered by such city under RCW 35.21.730 through 35.21.755;
     (e) Every county with a population greater than four hundred fifty thousand;
     (f) Every port district with total revenues greater than fifteen million dollars per year;
     (g) Every public utility district with revenues from energy sales greater than twenty-three million dollars per year;
     (h) Every school district; and
     (i) The state ferry system.
     (2)(a) The department of general administration may issue job order contract work orders for Washington state parks department projects.
     (b) The department of general administration, the University of Washington, and Washington State University may issue job order contract work orders for the state regional universities and The Evergreen State College.
     (3) Public bodies may use a job order contract for public works projects when a determination is made that the use of job order contracts will benefit the public by providing an effective means of reducing the total lead-time and cost for the construction of public works projects for repair and renovation required at public facilities through the use of unit price books and work orders by eliminating time-consuming, costly aspects of the traditional public works process, which require separate contracting actions for each small project.

NEW SECTION.  Sec. 8   RCW 39.10.310 (Design-build procedure--Negotiated adjustments to lowest bid or proposal -- When allowed) and 2007 c 494 s 202 & 1994 c 132 s 8 are each repealed.