WSR 97-05-007

PROPOSED RULES

DEPARTMENT OF TRANSPORTATION

[Filed February 7, 1997, 8:37 a.m.]

Original Notice.

Preproposal statement of inquiry was filed as WSR 97-01-087.

Title of Rule: Chapter 468-16 WAC, Prequalification of contractors.

Purpose: To make minor changes to chapter 468-16 WAC to improve its effectiveness.

Statutory Authority for Adoption: RCW 47.01.101, 47.28.030, and 47.28.070.

Summary: Provides clarification for determining the maximum bidding capacity rating for a firm with an established ESOP (employee stock ownership plan), and suspension of qualification for failure to comply with EEO requirements.

Reasons Supporting Proposal: To implement statutory provisions for implementing the qualification process.

Name of Agency Personnel Responsible for Drafting: Ken Walker, 1D21 Transportation Building, (360) 705-7017; Implementation and Enforcement: John F. Conrad, 1C2 Transportation Building, (360) 705-7801.

Name of Proponent: Washington State Department of Transportation, governmental.

Rule is not necessitated by federal law, federal or state court decision.

Explanation of Rule, its Purpose, and Anticipated Effects: The proposed changes add clarity to the procedures for determining the qualifications of contractors performing highway construction. Chapter 468-16 WAC implements RCW 47.28.070 relating to prequalification of contractors for highway construction. The purpose of the rule is to assure that highway construction projects are awarded to competent and responsible contractors. The rule establishes an objective method for determining a contractor's qualifications and retention of such qualifications for bidding on department work. It further provides for the enhancement of the contractor's bidding capacity through higher standards of performance. The rule increases the opportunity for better cooperation between the department and the construction industry. The rule provides for the award, denial, suspension, or revocation of qualification, and for a hearing procedure for such action.

Proposal Changes the Following Existing Rules: The rule codifies existing and new procedures for prequalification of contractors. It establishes rules for setting the maximum bidding capacity of a firm with and [an] established leveraged ESOP (employee stock ownership plan). It clarifies the penalties for failure to comply with equal employment opportunities, or women's, minority, and disadvantaged business enterprise requirements.

No small business economic impact statement has been prepared under chapter 19.85 RCW. A small business economic impact statement is not required. The cost of prequalification under the proposed rules would impose no greater cost than would occur in compliance with our current prequalification process.

Section 201, chapter 403, Laws of 1995, does not apply to this rule adoption.

Hearing Location: Commission Boardroom 1D2, Transportation Building, 310 Maple Park Drive, Olympia, WA 98504-7360, on April 15, 1997, at 1:00 p.m.

Assistance for Persons with Disabilities: Contact TDD (360) 705-6980, by April 11, 1997.

Submit Written Comments to: Ken Walker, Office Manager, Contract AD and Award, P.O. Box 47360, Olympia, WA 98504-7360, FAX (360) 705-6810, by April 11, 1997.

Date of Intended Adoption: April 15, 1997.

February 6, 1997

S. A. Moon

Deputy Secretary

for Operations

AMENDATORY SECTION (Amending Order 134, filed 1/12/93, effective 2/12/93)

WAC 468-16-030 Definitions. The definitions set forth in this section apply throughout this chapter and have the following meanings, unless the context clearly indicates otherwise.

(1) Above standard - Performance ranging from standard to that meeting the lower range of superior.

(2) Active contractor - A contractor who has participated in department activities through maintaining required prequalification and having a history of performing department work.

(3) Affiliate - An associate, subordinate associate, or subsidiary firm which may involve the intermingling of funds, officers, or officials of one or more firms.

(4) Assistant secretary for field operations support - The primary representative of the secretary of transportation responsible for the highway construction program and for the qualification of contractors employed thereon.

(5) Below standard - Performance bordering on standard extending to the limits of inadequate.

(6) Bidding proposal - A form issued by the department for the submission of a contractor's bid containing spaces for entering bid amounts, authentication, and other data.

(7) Capacity multiplier - The number 5.0 multiplied by a firm's net worth to calculate its initial maximum bidding capacity.

(8) Conditional qualification - A temporary qualification status given a contractor who has received a "below standard" or "inadequate" overall rating or for other reasons which result in restrictions to a contractor's ability to bid on department work.

(9) Contractor - Any person, partnership, firm, corporation or joint venture who or which, in the pursuit of an independent business, undertakes, offers to undertake, or submits a bid to perform construction work for the department.

(10) Department - The department of transportation.

(11) Endorser - The ((district)) region operations engineer or immediate supervisor of the construction project engineer, or project architect or, under specified conditions, the ((district)) region administrator responsible for reviewing contractor's performance reports.

(12) Inadequate - Performance failing completely to meet the prescribed standard or requirement.

(13) Integrity - The quality of being of sound moral principle, uprightness, honesty, and sincerity.

(14) Joint venture - Two or more persons, sole proprietorships, companies, corporations, or combinations thereof, entering into an agreement for a business venture such as a construction project.

(15) Limited work class - A work classification given when a contractor lacks the total experience, organization, equipment, or skills required to perform the entire range of work within a work class.

(16) Maximum capacity rating - The total value of uncompleted prime contract work a contractor is permitted to have under contract at any time.

(17) Performance inquiry - A request made to a contractor's previous employers for an evaluation of the quality and manner of that contractor's performance.

(18) Performance rating - A numerical rating which is equal to the grand total of the evaluation elements of the prime contractor's performance report used to measure and quantify the quality of contractor performance.

(19) ((Performance score - The product of the performance rating when multiplied by a numerical factor which may be used to calculate prequalification ratings.

(20))) Prequalification - The process of evaluating a contractor's financial status, organizational structure, experience, equipment, integrity, and other required qualifications to determine a contractor's responsibility and suitability for performing department work. This term is used interchangeably with qualification.

(((21))) (20) Prime contractor performance report - A report prepared to evaluate the performance of a prime contractor upon completion of, or at an interim period during a department project which is used ((as a guide)) to adjust a prime contractor's qualification status.

(((22))) (21) Project estimate - A document prepared by the department establishing the estimated value of all items of work, the total estimated value of work within each class of work, and the estimated total value of a project.

(((23))) (22) Rater - The designated individual, normally the project engineer, responsible for evaluation of the quality and manner of performance of a contractor in the completion of a project.

(((24))) (23) Revocation of qualification - The act by which a contractor's qualification is terminated.

(((25))) (24) Secretary - The secretary of transportation who may delegate his or her functions under this chapter to the assistant secretary for field operations support or such other individual as deemed appropriate.

(((26))) (25) Standard - The expected, acceptable quality of performance, considered to meet the demand, need or requirement.

(((27))) (26) Standard questionnaire - The application form completed by a contractor to present information relating to the applicant's financial status, experience, organization, and equipment for the purpose of becoming qualified to perform department work.

(((28))) (27) Superior - Preeminent performance consistently at an extremely high level.

(((29))) (28) Suspension of qualification - The termination of a contractor's qualification for a specified period of time.

(((30))) (29) Unsatisfactory - Below standard or inadequate performance, failing to meet requirements.

(((31))) (30) Work class - A specific type of work within the various classifications of work, e.g., grading, draining, fencing, etc.

(((32))) (31) Work class rating - The maximum value within a class of work ((which a contractor may bid upon in)) that is used to determine a firm's eligibility to receive a bid proposal document for a single project.

[Statutory Authority: RCW 47.01.101, 47.28.030 and 47.28.070. 93-03-020 (Order 134), 468-16-030, filed 1/12/93, effective 2/12/93; 91-04-014 (Order 128), 468-16-030, filed 1/28/91, effective 2/28/91.]

AMENDATORY SECTION (Amending Order 128, filed 1/28/91, effective 2/28/91)

WAC 468-16-080 Qualification procedures for projects under fifty thousand dollars. (1) Contractors may be qualified by ((district)) region administrators for projects valued under fifty thousand dollars.

(2) Procedures for letting ((district)) region level projects valued under fifty thousand dollars are published in Department Directives.

(3) A limited prequalification questionnaire and other requirements are prescribed in WAC 468-14-040.

[Statutory Authority: RCW 47.01.101, 47.28.030 and 47.28.070. 91-04-014 (Order 128), 468-16-080, filed 1/28/91, effective 2/28/91.]

AMENDATORY SECTION (Amending WSR 94-05-004, filed 2/2/94, effective 3/5/94)

WAC 468-16-090 Standard questionnaire. The standard questionnaire and financial statement shall be prepared and transmitted to the secretary, Attn: ((Precontract administration)) Contractor prequalification office. The questionnaire shall include the following information:

(1) The contractor's name, address, phone number, facsimile number, and type of organization (corporation, partnership, sole proprietorship, etc.).

(2) A list of the classes of work for which the contractor seeks qualification.

(3) A statement of the ownership of the firm and, if a corporation, the name of the parent corporation, if any, and the names of any affiliated or subsidiary companies.

(4) A certificate of authority from the office of the secretary of state to do business in Washington state if the applicant is an out-of-state corporation.

(5) A list of officials within the applicant firm who are also affiliated with other firms involved in construction work as a contractor, subcontractor, supplier, or consultant; including the name of the firm and their relationship with the affiliate firm.

(6) A complete list of the highest valued contracts or subcontracts performed in whole or in part within the immediate three years preceding application. The contract amount, contract number, date of completion, class of work; and the name, mailing address, and phone number of the project owner or agency representative must be provided for those projects listed. Only that work completed by the contractor's own organization under its own supervision will be considered for prequalification purposes. A minimum of five completed projects must be listed.

(7) Personnel requirements.

(a) A listing of the principal officers and key employees indicating their years of experience in the classes of work for which prequalification is sought. For qualification in a class of work based on newly acquired personnel rather than the firm's past contract experience, the newly acquired personnel must be available for future employment for the full year for which qualification is sought unless replacement personnel have been approved. The loss of such personnel during the year of qualification, will result in revocation of qualification for the class of work granted pursuant to their acquisition. The department may require resumes of such personnel as deemed proper for making its determination. The firm's performance on department contracts must be currently rated standard or better to be used for qualification purposes.

(b) A firm must have, within its own organization, qualified permanent, full time personnel having the skills and experience including, if applicable, technical or specialty licenses, for each work class for which prequalification is sought. Those firms seeking qualification for electrical work (classes 9 and 16) must provide photocopies of current Washington state electrical licenses. The skills and experience must be substantiated by education and practical experience on completed construction projects.

(c) "Its own organization" shall be construed to include only the contractor's permanent, full time employed office and site supervisory personnel as shown on the most recently submitted or amended prequalification questionnaire. Workers of the organization shall be employed and paid directly by the prime contractor. The term "its own organization," shall also include the equipment owned or rented by the contractor with or without equipment operators. Such term does not include employees or equipment of another contractor, subcontractor, assignee, or agent of the applicant contractor although they are placed on the applicant contractor's payroll.

(8) A list of all major items of equipment used to perform those classes of work for which prequalification is sought. The description, quantity, condition, present location, and age of such equipment must be shown. The schedule must show whether the equipment is owned, leased, or rented.

(9) A financial statement.

(((a))) For a firm showing a net worth in excess of one hundred thousand dollars, the applicant must provide, with the questionnaire, a copy of its financial statement as audited or reviewed for its last fiscal year, prepared in accordance with the standards of the American Institute of Certified Public Accountants. The statement must be prepared by an independent certified public accountant registered and licensed under the laws of any state. Balance sheets, income statements, a statement of retained earnings, supporting schedules and notes, and the opinion of the independent auditor must accompany the financial statement.

(((b) Financial statements must be for the current twelve month period and must reflect a ratio of total current assets to total current liabilities of 1.0 or greater.))

(10) A wholly owned subsidiary firm may file the latest consolidated financial statement of its parent corporation in lieu of a financial statement prepared solely for the subsidiary. When a consolidated financial statement is submitted, the requirements of subsection (9) of this section and WAC 468-16-140 (2)(b) must be fulfilled.

(11) The applicant shall list the following occurrences within the previous three years:

(a) Instances of having been denied qualification, or a license, or instances of having been deemed other than responsible by any public agency.

(b) Convictions for felonies listed in WAC 468-16-050.

(c) Failure to complete a contract.

(12) The standard questionnaire shall be processed as follows:

(a) The application for qualification shall be prepared on a standard questionnaire provided by the department and sworn to before a notary public or other person authorized to take oaths.

(b) A standard questionnaire will be reviewed and a written notice provided to the applicant, within thirty days of its receipt, stating whether the applicant has been prequalified or qualification has been denied. The applicant will be advised of lack of receipt of data corroborating project completion and errors or omissions in the questionnaire and a request made for additional information necessary to complete evaluation of the applicant. If the information is not provided within twenty calendar days of the request, the application will be processed, if possible, with the information available or it will be returned to the applicant without further action.

(c) When qualification is denied, the applicant shall be advised in writing by certified mail (return receipt requested) of the reasons for the denial and of the right to a hearing upon written request.

(d) Applicants not satisfied with the qualification granted may request in writing, a review of their questionnaire and qualification ratings. The request must be filed within thirty calendar days of the date of receipt of the notice of qualification and must specifically state the basis for the request.

(e) The secretary or designee shall advise the applicant of his or her decision on the reconsideration within thirty calendar days of receipt of the request.

(13) Criteria for initial qualification, renewal, and submission of supplemental data:

(a) Qualification may be established in any calendar quarter and must be renewed annually. Information submitted in the questionnaire will be used as a basis for the contractor's initial prequalification, work class ratings, and maximum capacity ratings. Qualification will be valid for the remainder of the applicant's fiscal year plus one calendar quarter as established by the date of the year-end financial statement. Prequalification will be renewed annually thereafter or at other times as designated by the department.

(b) A standard questionnaire from a contractor, not previously qualified under this chapter, must have been received by the department no less than fifteen calendar days prior to the scheduled bid opening to receive consideration for issuance of a bidding proposal for that bid opening.

(c) The department may, during the period for which the contractor has been prequalified, require the submission of a new standard questionnaire. If the questionnaire is not provided within thirty calendar days of the date of request, the notice of qualification held by the contractor will be declared invalid and the contractor will not be permitted to bid with the department until the contractor is again prequalified.

(d) A supplemental questionnaire shall be submitted when a significant change in the structure of the firm occurs, e.g., incorporation, officers, ownership, etc., or when required by the department.

(e) If prequalification has lapsed for more than six months, the applicant will again be required to submit a fully executed standard questionnaire and financial statement.

(f) The applicant shall authorize the department to request and receive such additional information from any sources deemed necessary for the completion of the qualification process.

(g) Inquiries will be made and investigations, if necessary, will be conducted to verify the applicant's statements and to determine eligibility for qualification.

(h) The department may require a personal interview with a principal or principals of the contracting firm when considering its qualification.

(i) Qualified contractors in good standing shall be notified of impending expiration of their qualification and will be provided the necessary questionnaire forms for renewal at least forty-five days before the expiration date.

(14) Financial information supplied by, or on behalf of, a contractor for the purpose of qualification shall not be made available for public inspection and copying pursuant to RCW 42.17.310 (1)(m). The foregoing restriction shall not prohibit the department's providing such information in evidence or in pretrial discovery in any court action or administrative hearing involving the department and a contractor. Insofar as permitted by public disclosure statutes, qualification ratings shall be treated as confidential information.

(15) Qualified contractors will be provided with notices which list projects currently being advertised.

[Statutory Authority: RCW 47.01.101, 47.28.030 and 47.28.070. 94-05-004, 468-16-090, filed 2/2/94, effective 3/5/94; 93-03-020 (Order 134), 468-16-090, filed 1/12/93, effective 2/12/93; 91-04-014 (Order 128), 468-16-090, filed 1/28/91, effective 2/28/91.]

AMENDATORY SECTION (Amending Order 134, filed 1/12/93, effective 2/12/93)

WAC 468-16-100 Conditional qualification. (1) A firm may be conditionally qualified when it has been given a below standard (less than ((1.0)) 100) performance ((score)) rating on a final performance report. A firm may also be qualified conditionally by the secretary when performance has become below standard in either "quality of work" or "progress of work" on an interim report for a current project. The ((district)) region administrator may, under the foregoing condition, request in writing that a contractor be placed in conditional status. A conditionally qualified contractor will be denied bidding proposals while in that status but may receive, at the discretion of the secretary, a bidding proposal for one project.

(2) The assistant secretary for field operations support shall advise the contractor and the ((district)) region administrator when a contractor has been placed in conditional status.

(3) Should the contractor be the low successful bidder and be awarded a contract subsequent to being placed in conditional status, the issuance of further bidding proposals will be considered only when an interim report is submitted in accordance with WAC 468-16-160 or when a final performance report is submitted in accordance with WAC 468-16-150(12) and the rating thereon is standard or better.

(4) Normally a contractor may have only one active prime contract for the department while qualified conditionally.

(5) Return to fully qualified status of a conditionally qualified contractor will be effected by:

(a) A performance rating of standard or above on contracts completed during the current prequalification year; or

(b) An interim rating of standard or above on all concurrent contracts; or

(c) A standard or above rating on the first interim report for a project awarded subsequent to conditional qualification.

(6) Should the rating continue to be less than standard, the contractor's prequalification will be suspended in accordance with WAC 468-16-180.

[Statutory Authority: RCW 47.01.101, 47.28.030 and 47.28.070. 93-03-020 (Order 134), 468-16-100, filed 1/12/93, effective 2/12/93; 91-04-014 (Order 128), 468-16-100, filed 1/28/91, effective 2/28/91.]

AMENDATORY SECTION (Amending WSR 94-05-004, filed 2/2/94, effective 3/5/94)

WAC 468-16-120 Work class ratings. (1) Qualification shall be granted a contractor in one or more classes of work in which the firm has shown the capability to satisfactorily perform with its own forces under its own immediate supervision.

(2) The department's project estimate shall be the only estimate used to determine the value of the various classes of work within a project for determining a contractor's eligibility to bid that specific project. The contractor will be required to perform a specified percentage of the total work as provided for in the current issue of the Standard Specifications.

(3) Contractors will be given work class ratings on the basis of their financial status, performance record, previous experience, organization, and condition and suitability of equipment. ((Higher performance ratings result in higher work class ratings.))

(4) When it has been determined that adequate competition cannot be afforded as a result of either the lack of prequalified bidders, or the lack of applicants for qualification with sufficient experience in the work class required, the department may take in consideration the firm's experience in performing other related work in order to create competition providing that:

(a) The work class does not require a specialty license.

(b) The firm seeking the work class is deemed qualified in another work class under chapter 468-16 WAC.

(c) The firm seeking such work meets all other requirements prescribed under this chapter including the availability of the necessary equipment for the project being let.

(5) Data provided by project owners, other than the department, to inquiries made concerning new applicants seeking qualification, shall be used to determine initial work class ratings and maximum capacity ratings. Initial work class ratings for new applicants and those of firms which have not renewed their qualification within two years, will be based on performance data provided by agencies or organizations having previously employed the applicant. Such other data as the department may have on file may also be used. Work submitted by the new contractor and verified by the department will be given an initial work class rating equal to 2.5 times the highest value of the work the contractor has completed within that work class during the past three years. If a specific portion of a work class is performed by the contractor, the prequalification for that class will be limited to that portion of the work.

(6) Work reported as less than satisfactory will not be accepted for qualification purposes, but may be included with performance reports in determining the status of the contractor's prequalification.

(7) Work class ratings previously granted will not be reduced providing the contractor has maintained a standard performance record on department work and the contractor continues to submit the required questionnaire annually. Should a significant reduction of resources occur, the contractor's work class ratings may be modified or reduced to an amount within the contractor's current capacity.

(8) A contractor's work class ratings will be reviewed annually effective on the date the renewal questionnaire has been received. Work class ratings for those contractors renewing prequalification will be reviewed for increases, decreases, and additional work classes not previously granted. In determining the annual status of the contractor's work class ratings, prime work completed for the department and the performance rating given for that work shall be weighted more heavily than work completed for other agencies.

(9) Work class ratings shall be computed by multiplying the highest value of the work class completed satisfactorily during the preceding prequalification year by a factor of 2.5 provided that the currently established work class rating is not higher. In that event, the currently established work class shall become the work class rating for the ensuing qualification year. Work class ratings will not change if the contractor has not performed in that work class during the prequalification year.

(((10) Work class ratings for inactive contractors renewing prequalification will be computed annually in the same manner as for new applicants for a period not to exceed three years. Work class ratings granted within three successive renewal periods shall remain the same as for an inactive contractor if the contractor continues to submit the required questionnaire annually and the questionnaire does not reveal a significant reduction in organizational resources. When a significant reduction of resources occurs, the inactive contractor's work class ratings may be modified to an amount within the contractor's current capacity.))

[Statutory Authority: RCW 47.01.101, 47.28.030 and 47.28.070. 94-05-004, 468-16-120, filed 2/2/94, effective 3/5/94; 93-03-020 (Order 134), 468-16-120, filed 1/12/93, effective 2/12/93; 91-04-014 (Order 128), 468-16-120, filed 1/28/91, effective 2/28/91.]

AMENDATORY SECTION (Amending WSR 94-05-004, filed 2/2/94, effective 3/5/94)

WAC 468-16-130 Prequalification work classes. A contractor seeking prequalification under this chapter will be classified for one or more of the following listed work classes in accordance with the adequacy of the firm's equipment and plant facilities and its proven ability to perform the work class sought.

Class 1 Clearing, grubbing, grading & draining

Removal of tree stumps, shrubs, modification of the ground surface by cuts and fills, excavating of earth materials, and the placement of drainage structures.

Class 2 Production and placing of crushed materials

Production and placing crushed surfacing materials and gravel.

Class 3 Bituminous surface treatment

Placing of crushed materials with asphaltic application.

Class 4 Asphalt concrete paving

Production and placing Asphalt Concrete Plant Mix Pavement.

Class 5 Cement concrete paving

Production and placing cement concrete pavement.

Class 6 Bridges and structures

Construction of bridges, walls and other major structures of timber, steel, and concrete.

Class 7 Buildings

Construction of buildings and related structures within the right of way and major reconstruction and remodeling of such buildings.

Class 8 Painting

Painting bridges, buildings, and related structures.

Class 9 Traffic signals

Installation of traffic signal and control systems.

Class 10 Structural tile cleaning

Cleaning tunnels, large buildings and structures and storage tanks.

Class 11 Guardrail

Construction of a rail secured to uprights and erected as a barrier between, or beside lanes of a highway.

Class 12 Pavement marking (excluding painting)

Thermoplastic markings, stripes, bars, symbols, etc. Traffic buttons, lane markers, guide posts.

Class 13 Demolition

Removal of timber, steel, and concrete structures and obstructions.

Class 14 Drilling and blasting

Controlled blasting of rock and obstructions by means of explosives.

Class 15 Sewers and water mains

Draining, pipe jacking, water systems, pumping stations, storm drainage systems, sewer rehabilitation, sewage pumping stations, pressurized lines.

Class 16 Illumination & general electrical

Highway illumination, navigational lighting, wiring, junction boxes, conduit installation.

Class 17 Cement concrete curb and gutter

Sidewalks, spillways, driveways, monument cases and covers, right of way markers, traffic curbs, and gutters.

Class 18 Asphalt concrete curb and gutter

Sidewalks, spillways, driveways, monument cases and covers, right of way markers, traffic curbs, and gutters.

Class 19 Riprap and rock walls

Mortar, rubble, and masonry walls; rock retaining walls, and placing of large broken stone on earth surfaces for protection against the action of water.

Class 20 Concrete structures except bridges

Cast-in-place median barrier, prestressing, post-tensioned structures, footings, prefabricated panels and walls, retaining walls, and ramps, foundations, rock bolts, and concrete slope protection.

Class 21 Tunnels and shaft excavation

Tunnel excavation, rock tunneling, and soft bore tunneling.

Class 22 Piledriving

Driving concrete, steel, and timber piles.

Class 23 Concrete surface treatment

Exposed aggregate, fractured-fin and rope textured finishes; waterproofing concrete surfaces (clear or pigmented sealer).

Class 24 Fencing

Wire and metal fencing, glare screens.

Class 25 Bridge deck repair

Bridge expansion joint repair and modification, bridge deck resurfacing and repair.

Class 26 Deck seal

Waterproof membrane.

Class 27 Signing

Sign structures and signs.

Class 28 ((Electronics

Surveillance and control systems design and installation, electronics training and maintenance.)) Not used

Class 29 Slurry diaphragm and cut-off walls

Slurry excavation and the construction of structural concrete walls and slurry cut-off walls.

Class 30 Surveying

Highway construction surveying.

Class 31 Water distribution and irrigation

Irrigation systems and heavy duty water distribution.

Class 32 Landscaping

Landscape irrigation, planting, sodding, seeding, fertilizing, mulching, herbicide application, insecticide application, weed control, mowing, liming, soil binder, topsoil.

Class 33 Engineering

Work other than surveying, including engineering calculations, drawing and other related work for highway construction.

Class 34 Erosion control

Seeding, fertilizing, mulching, slope protection, topsoil application, hydro-seeding, soil stabilization, soil sampling.

Class 35 Precast median barrier

A concrete barrier that is cast and cured in other than its final position used to divide the median of two adjacent highways or temporarily placed to divert traffic in construction zones.

Class 36 Permanent tie back anchor

Installation of permanent rock and soil anchors, soldier piles and timber lagging. Soldier pile tie back anchor wall construction.

Class 37 Impact attenuators

Installation of approved protective systems filled with sand, water, foam, or other substances which prevent errant vehicles from impacting roadside hazards.

Class 38 Paint striping

Painted bars, letters, symbols, and striping.

Class 39 Wire mesh slope protection

The installation of a zinc coated steel wire mesh anchored by wire rope and reinforced concrete posts or anchor rods. Used for dampening the effects of rolling rocks onto the highway. Slope scaling, horizontal drains, rock dowels, and rock bolts for slope stabilization.

Class 40 Gabion and gabion construction

Construction of walls made with containers of galvanized steel hexagonal wire mesh and filled with stone.

Class 41 Not used

Class 42 Electronics--fiber optic based communications systems

Design and installation of fiber optic based communication systems.

Class 43 Mechanical

Plumbing work and the installation of heating or air conditioning units.

Class 44 Asbestos abatement

Asbestos abatement (L & I certified workers).

Class 45 ((Not used)) Hazardous waste removal

The containment, cleanup, and disposal of toxic materials. Companies seeking this classification shall have full-time personnel with current hazardous waste training (certifications).

Class 46 Concrete restoration

Pavement subseal, cement concrete repair, epoxy coatings, epoxy repair, masonry repair, masonry cleaning, special coatings, epoxy injection, gunite, shotcrete grouting, pavement jacking, gunite repair, and pressure grouting.

Class 47 Concrete sawing, coring, and grooving

Concrete sawing, concrete planing and grooving, bump grinding, joint repair, concrete coring, rumble strips.

Class 48 Dredging

Excavating underwater materials.

Class 49 Marine work

Underwater surveillance, testing, repair, subaquatic construction, anchors, and cable replacement, floating concrete pontoon repairs and modifications, disassembly and assembly of floating concrete pontoons.

Class 50 ((Not used)) Ground modification

Pressure grouting, blast densification, stone column, jet grouting, compaction, dynamic compaction, soil mixing, gravel drain.

Class 51 Well drilling

Drilling wells, installing pipe casing and pumping stations.

Class 52 Sewage disposal

Hauling and disposing liquid and solid wastes.

Class 53 Traffic control

Providing piloted traffic control, traffic control labor, and maintenance and protection of traffic.

Class 54 Railroad construction

Construction of railroad subgrade, placing of ballast, ties, and track and other items related to railroad work.

Class 55 Steel fabrication

Welding of steel members, heat straightening steel.

Class 56 Street cleaning

Street sweeping with self-propelled sweeping equipment.

Class 57 Materials transporting

Truck hauling.

Class 58 Sand blasting and steam cleaning

Steam cleaning, sand blasting, shot blasting, and water blasting.

[Statutory Authority: RCW 47.01.101, 47.28.030 and 47.28.070. 94-05-004, 468-16-130, filed 2/2/94, effective 3/5/94; 93-03-020 (Order 134), 468-16-130, filed 1/12/93, effective 2/12/93; 91-04-014 (Order 128), 468-16-130, filed 1/28/91, effective 2/28/91.]

AMENDATORY SECTION (Amending Order 134, filed 1/12/93, effective 2/12/93)

WAC 468-16-140 Maximum capacity rating. (1) The maximum capacity rating shall be determined by multiplying the contractor's reported net worth by a factor of 5.0. The factor may be increased at a rate of 0.5 annually, provided the contractor has maintained a satisfactory performance record with the department and has completed a contract of fifty thousand dollars or more within the preceding prequalification year. The maximum factor shall be 7.5. The department may at any time decrease the rating factor if the contractor's performance becomes less than standard, however no decrease in the bidding capacity will become effective until action to appeal, as specified in these rules, has been completed.

(2) For the purpose of prequalification and establishing the maximum capacity rating, the following additional resources may be added to net worth if supported with documentation as specified:

(a) An operating line of credit - Documentation from an acceptable financial institution stating the amount of credit authorized, its expiration date, and the amount currently available. The document must be authenticated by an official authorized to execute lines of credit on behalf of the institution. Should the operating line of credit be revoked, it shall be deducted before computing a new annual maximum capacity rating.

(b) A parent firm pledge of net worth - A sworn statement from the parent firm that guarantees the performance of the subsidiary for any contracts awarded it. The document shall include a parent firm pledge in an amount such that when calculated in subsection (1) of this section will not be less than the value of uncompleted contracts of the subsidiary. An audited financial statement, as prescribed in WAC 468-16-090 (9)(((a))), may be requested from the parent firm when deemed appropriate.

(c) A personal pledge of net worth - A sworn statement pledging a specific amount of personal assets. The statement must be accompanied by acceptable documents that will verify the ownership and value of the assets.

(3) Resources listed above will not be accepted in lieu of a minimum net worth of fifty thousand dollars.

(4) For the purpose of prequalification and establishing the maximum capacity rating, a bidding company which has established a leveraged ESOP (Employee Stock Ownership Plan) may use, in place of its net worth, the lesser of:

(a) The company's net worth, as adjusted by eliminating any contra-equity or unearned compensation entry in the net worth section of the balance sheet which is directly related to the ESOP loan; or

(b) The company value as established by the company's most recent valuation for ESOP purposes provided the valuation was performed within the last twelve months which meets federal guidelines for ESOP-related valuations. The department may require submission of a copy of this valuation report for documentation purposes.

(5) When the value of a firm's uncompleted work for the department exceeds its maximum capacity rating, a bidding proposal shall be denied that firm.

[Statutory Authority: RCW 47.01.101, 47.28.030 and 47.28.070. 93-03-020 (Order 134), 468-16-140, filed 1/12/93, effective 2/12/93; 91-04-014 (Order 128), 468-16-140, filed 1/28/91, effective 2/28/91.]

AMENDATORY SECTION (Amending WSR 94-05-004, filed 2/2/94, effective 3/5/94)

WAC 468-16-150 Prime contractor performance reports. (1) Performance reports described in this section, substantially in the format as that appearing at WAC 468-16-210, will be completed for prime contractors only for projects valued at one hundred thousand dollars or more. Each prime contractor's performance report will be classified as to the primary work class being rated. This shall be stated in Section I of the report by listing the major classes of work performed by the contractor e.g., clearing, grading, surfacing, etc.

(2) Performance will be rated under the following headings: Administration, management, and supervision; quality of work; progress of work; and equipment.

(3) The following adjectival ratings are established for performance reports:

(a) Superior((.)) 131-150

(b) Above standard((.)) 101-130

(c) Standard((.)) 100

(d) Below standard((.)) 70-99

(e) Inadequate((.)) 50-69

(4) ((The report shall contain a numerical section which quantifies the adjectival ratings into a total performance rating which is multiplied by .01 to obtain a performance score falling within one of the following ranges:

Superior 1.31 - 1.50

Above Standard 1.01 - 1.30

Standard 1.00

Below Standard .70 - .99

Inadequate .50 - .69

(5) The performance score (PS) is computed by multiplying the performance rating (PR) obtained from the prime contractor's performance report by a factor (F) of .01 e.g., 129 (PR) x .01 (F) = 1.29 (PS).

(6) The annual performance score is the average of the scores, by work class, obtained from all performance reports submitted for department projects completed during the one-year period next preceding the date of expiration of the contractor's qualification.

(7))) The performance report shall be used in ((fixing)) evaluating a contractor's prequalification status.

(((8))) (5) The report shall contain a narrative section which verbally provides the details substantiating the numerical rating. The narrative section shall be based upon documentation prepared during the life of the project, such as the project engineer's diary, the inspector's daily report and other pertinent documents. This documentation shall constitute the major portion of the administrative record to be used for any hearings or litigation that may arise from the rating process.

(((9))) (6) The performance report will be prepared and discussion held with the contractor by the project engineer. The report will include a numerical rating substantiated by a narrative report which describes the contractor's typical performance. The narrative will reference such documents as will substantiate the given numerical rating.

(((10))) (7) The report will be endorsed by the ((district)) region operations engineer or designated assistant who will provide a copy to the contractor.

(((11))) (8) The contractor may appeal the rating to the ((district)) region administrator in writing within twenty calendar days of the date the report is received by the contractor. If the report is not delivered to the contractor in person, it shall be forwarded by certified mail with a return receipt requested. The appeal must set forth the specific basis upon which it has been made.

(((12))) (9) The ((district)) region administrator will review all contractor performance reports after they have been endorsed and may modify the numerical or narrative rating if such is deemed appropriate. The contractor will be advised of any changes made. The ((district)) region administrator will be required to make comments thereon only when the contractor's overall performance rating has been rated inadequate, below standard, or superior.

(((13))) (10) Performance reports, when completed at ((district)) region level, will be submitted to the secretary, Attn: Manager, ((precontract administration)) contractor prequalification office, not later than forty-five calendar days following final completion of the project.

(((14))) (11) The ((district)) region administrator shall review the appeal and provide a written response to the contractor by certified mail (return receipt requested) within twenty calendar days of its receipt. A copy of the appeal and the response thereto will be forwarded to the secretary, Attn: ((Precontract administration)) Contractor prequalification office.

(((15))) (12) The contractor may further appeal to the secretary in writing setting forth the specific basis for the appeal. The contractor's appeal shall be made within ten calendar days of the date of receipt of the ((district)) region administrator's response. When making an appeal, the contractor may also present information in person. The secretary will consider the appeal and respond to it by certified mail within sixty calendar days of its receipt. This determination shall be the final administrative act of the department.

(((16))) (13) All prime contractor performance reports shall be reviewed by the office of the secretary for completeness, objectivity, and substantiation of numerical ratings. The secretary may modify the report as deemed appropriate as a result of the review. The rated contractor and ((district)) region administrator shall be given a copy of the modified report. The contractor may appeal the modified report in the manner and within the time allotted in subsection (((15))) (12) of this section to which the secretary shall respond as cited therein.

(((17))) (14) A prime contractor performance report shall be considered a preliminary paper until all reviews and appeals have been accomplished and it shall have been stamped and initialed as having been "filed in the office of the secretary."

(((18))) (15) DOT Form 421-010 is authorized.

[Statutory Authority: RCW 47.01.101, 47.28.030 and 47.28.070. 94-05-004, 468-16-150, filed 2/2/94, effective 3/5/94; 93-03-020 (Order 134), 468-16-150, filed 1/12/93, effective 2/12/93; 91-04-014 (Order 128), 468-16-150, filed 1/28/91, effective 2/28/91.]

AMENDATORY SECTION (Amending WSR 94-05-004, filed 2/2/94, effective 3/5/94)

WAC 468-16-160 Interim reports. (1) Interim performance reports will be completed for contracts of long duration, particularly those in excess of one year and submitted to the ((manager, precontract administration)) contractor prequalification office. They will be completed annually on the anniversary of the start date of the contract. An interim report will also be completed when a contractor's total, overall work has become less than standard and the firm has been advised in writing of such performance. An interim report may never cover a period of more than one year. The report will be used by the secretary as a basis for determining whether a contractor will be placed in conditional status.

(2) In the case of a conditionally qualified firm, an interim report shall be submitted at sixty calendar day intervals for the project being undertaken by that firm subsequent to its being placed in conditional status. When a contractor's overall performance has not been brought up to standard after two consecutive interim reports have been prepared, no further interim reports shall be made except at the written request of the contractor. The date of the report will be the date of the contractor's request.

(3) The project engineer shall submit an interim report when it becomes evident that he or she will no longer be involved in the project, providing that project has been in progress for twenty-five percent of the working days assigned the project or ninety working days whichever is less.

(4) Interim performance reports will supplement and will be made a part of the final performance report.

(5) The procedures specified in WAC 468-16-150 (((8))) (5) through (((17))) (14) are also applicable to the processing of the interim performance report.

(6) DOT Form 421-010 is authorized.

[Statutory Authority: RCW 47.01.101, 47.28.030 and 47.28.070. 94-05-004, 468-16-160, filed 2/2/94, effective 3/5/94; 93-03-020 (Order 134), 468-16-160, filed 1/12/93, effective 2/12/93; 91-04-014 (Order 128), 468-16-160, filed 1/28/91, effective 2/28/91.]

AMENDATORY SECTION (Amending Order 134, filed 1/12/93, effective 2/12/93)

WAC 468-16-170 Refusal to issue proposal. The secretary may refuse to issue a proposal for reasons as enumerated in WAC 468-16-040 through 468-16-070, inclusive. Refusal to issue a proposal may continue in effect until the cause for the refusal has been eliminated. One or more of the following additional conditions may be considered sufficient for refusal to issue a proposal:

(1) The value of outstanding work plus the contract total of the work proposed to be bid exceeds the contractor's maximum capacity rating.

(2) Being placed in conditional status.

(3) Making false, fraudulent, or deceptive statements on the standard questionnaire, related documents, or documents prepared in the course of prosecuting the work.

(4) Debarment or suspension from participation in federal or state projects.

(5) Expiration of qualification.

(6) Failure to update the latest questionnaire to fairly represent the contractor's current organization and financial status.

(7) ((Noncompliance with equal employment opportunity (EEO), or minority and women's business enterprise (MWBE), or disadvantaged business enterprise (DBE) regulations.

(8))) Bankruptcy.

(((9))) (8) The existence of any conditions described in WAC 468-16-040 through 468-16-070 inclusive.

[Statutory Authority: RCW 47.01.101, 47.28.030 and 47.28.070. 93-03-020 (Order 134), 468-16-170, filed 1/12/93, effective 2/12/93; 91-04-014 (Order 128), 468-16-170, filed 1/28/91, effective 2/28/91.]

AMENDATORY SECTION (Amending WSR 94-05-004, filed 2/2/94, effective 3/5/94)

WAC 468-16-180 Suspension of qualification. (1) A suspension may be ordered for cause or for a period pending the completion of investigation and any ensuing legal action for revocation of qualification.

(2) The secretary may, upon determination from reports, other documents, or through investigation that cause exists to suspend the qualification of a contractor, impose suspension upon a contractor.

(3) The secretary may suspend qualification for:

(a) Incompetency found detrimental to timely project completion or to the safety of the public or employees.

(b) Inadequate performance on one or more projects.

(c) Infractions of rules, regulations, specifications, and instructions which may adversely affect public health, welfare, and safety.

(d) Uncompleted work which might prevent the prompt completion of other work.

(e) ((Continual)) Failure to comply with equal employment opportunity or women's, minority and disadvantaged business enterprise requirements.

(f) Repeated failure to comply with equal employment opportunity or women's, minority, and disadvantaged business enterprise requirements.

(g) Debarment or suspension from participation in federal or state projects.

(((g))) (h) Pending completion of debarment proceedings in federal or state projects.

(4) The maximum period of suspension for acts or deficiencies enumerated above are as follows:

(a) For subsection (3)(a) and (e) of this section - Three months.

(b) For subsection (3)(b), (c), (d), and (((e))) (f) of this section - Six months.

(c) For subsection (3)(((f))) (g) of this section - For duration of debarment or suspension by the federal or other state agency.

(d) For subsection (3)(((g))) (h) of this section - Until a determination is made by the federal or other state agency.

(5) The secretary may reduce the period of suspension upon the contractor's supported request for reasons including, but not limited to:

(a) Newly discovered evidence;

(b) Elimination of causes for which the suspension was imposed.

[Statutory Authority: RCW 47.01.101, 47.28.030 and 47.28.070. 94-05-004, 468-16-180, filed 2/2/94, effective 3/5/94; 93-03-020 (Order 134), 468-16-180, filed 1/12/93, effective 2/12/93; 91-04-014 (Order 128), 468-16-180, filed 1/28/91, effective 2/28/91.]

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