BILL NUMBER: AB 2498 AMENDED
BILL TEXT
AMENDED IN SENATE AUGUST 31, 2012
AMENDED IN SENATE AUGUST 14, 2012
AMENDED IN SENATE JUNE 15, 2012
AMENDED IN ASSEMBLY MAY 1, 2012
INTRODUCED BY Assembly Member Gordon
FEBRUARY 24, 2012
An act to add Chapter 6.3 (commencing with Section 6700) to Part 1
of Division 2 of the Public Contract Code, relating to public
contracts.
LEGISLATIVE COUNSEL'S DIGEST
AB 2498, as amended, Gordon. Department of Transportation:
Construction Manager/General Contractor project method.
Existing law sets forth the requirements for the solicitation and
evaluation of bids and the awarding of contracts by state agencies
for the erection, construction, alteration, repair, or improvement of
any public structure, building, road, or other public improvement.
This bill would authorize the Department of Transportation to
engage in a Construction Manager/General Contractor project delivery
method, as specified, for projects for the construction of a highway,
bridge, or tunnel.
This bill would require the department to submit a report, as
specified, no later than July 1 of each year during which any project
using the Construction Manager/General Contractor method is underway
and no later than July 1 of the year after any project using the
Construction Manager/General Contractor method has been completed.
This bill would require the Department of Transportation, on or
after January 1, 2013, to use department employees or consultants
under contract with the department to perform project design and
engineering services, project development services, and construction
inspection services, as provided.
This bill would require specified information provided to the
department to be verified under oath, thus imposing a state-mandated
local program by expanding the scope of an existing crime.
The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
This bill would provide that no reimbursement is required by this
act for a specified reason.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Chapter 6.3 (commencing with Section 6700) is added to
Part 1 of Division 2 of the Public Contract Code, to read:
CHAPTER 6.3. CONSTRUCTION MANAGER/GENERAL CONTRACTOR
AUTHORITY: DEPARTMENT OF TRANSPORTATION
6700. (a) This chapter provides for an alternative procurement
procedure for certain building transportation
projects performed by the Department of Transportation.
(b) (1) It is the intent of the Legislature
in enacting this chapter to enable establish
a pilot program to test the utilization of a Construction
Manager/General Contractor method as a cost-effective option for
constructing transportation projects , including the potential
for partnering with local entities to deliver projects on the state
highway system .
(2) The Construction Manager/General Contractor method allows the
department to engage a construction manager during the design process
to provide input on the design. During the design phase, the
construction manager provides advice including, but not limited to,
scheduling, pricing, and phasing to assist the department to design a
more constructible project.
(c) The Legislature finds and declares that utilizing a
Construction Manager/General Contractor method requires a clear
understanding of the roles and responsibilities of each participant
in the process. The Legislature also finds and declares that
cost-effective benefits are achieved by shifting the liability and
risk for cost containment and project schedule to the construction
manager and by permitting the coherent phasing of projects into
discrete contract increments.
6701. (a) The Construction Manager/General Contractor method
provided by this chapter may be used by the department ,
but is not limited to, when it is anticipated that it will reduce
project costs or expedite project completion in a manner that is not
achievable through the design-bid-build method. Notwithstanding
any other law, for projects utilizing the Construction
Manager/General Contractor method provided by this chapter, the
department shall advertise, award, and administer the Construction
Manager/General Contractor contract. The department shall not
delegate the contracting authority.
(b) The department may use the Construction Manager/General
Contractor method on no more than four six
projects, at least three five of
which shall have construction costs greater than ten million dollars
($10,000,000).
(c) On at least four of the projects utilizing the Construction
Manager/General Contractor method provided by this chapter, the
department shall use department employees or consultants under
contract with the department to perform all project design and
engineering services related to design required for Construction
Manager/General Contractor project delivery consistent with Article
XXII of the California Constitution. On all six projects, the
department shall use department employees or consultants under
contract with the department to perform all construction inspection
services required for Construction Manager/General Contractor project
delivery consistent with Article XXII of the California
Constitution. Department resources, including personnel requirements,
necessary to perform all services described in this subdivision
shall be included in the department's capital outlay support program
for workload purposes in the annual Budget Act.
(c)
(d) (1) The department shall prepare and submit to the
Legislature, no later than July 1 of each year during which any
project using the Construction Manager/General Contractor method is
ongoing, a report that describes each project and provides relevant
data, including, but not limited to, the stage of completion,
district, cost, description, status, and estimated time to
completion.
(2) The department shall prepare and submit to the Legislature, no
later than July 1 of the year after any project using the
Construction Manager/General Contractor method has been completed, a
report that includes, in addition to the data in paragraph (1), all
of the following:
(A) Data on initial cost estimates, actual cost upon completion,
and the reasons for any difference.
(B) Estimated time for completion, actual time of completion, and
the reasons for any difference.
(C) The number and dollar value of any change orders for all
projects completed using the Construction Manager/General Contractor
method.
(d)
(e) (1) A report to be submitted pursuant to
subdivision (c) (d) shall be submitted
in compliance with Section 9795 of the Government Code.
(2) Notwithstanding Section 10231.5 of the Government Code, the
requirement for submitting a report imposed under subdivision
(c) (d) is inoperative on July 1 of the
year following the submission of the final report upon completion of
the fourth project of the department that uses the Construction
Manager/General Contractor method.
6702. As used in this chapter, the following terms have the
following meanings:
(a) "Construction manager" means a partnership, corporation, or
other legal entity that is able to provide appropriately licensed
contracting and engineering services as needed pursuant to a
Construction Manager/General Contractor method contract.
(b) "Construction Manager/General Contractor method" means a
project delivery method in which a construction manager is procured
to provide preconstruction services during the design phase of the
project and construction services during the construction phase of
the project. The contract for construction services may be entered
into at the same time as the contract for preconstruction services,
or at a later time. The execution of the design and the construction
of the project may be in sequential phases or concurrent phases.
(c) "Department" means the Department of Transportation as
established under Part 5 (commencing with Section 14000) of Division
3 of the Government Code.
(d) "Preconstruction services" means advice during the design
phase including, but not limited to, scheduling, pricing, and phasing
to assist the department to design a more constructible project.
(d)
(e) "Project" means the construction of a highway,
bridge, or tunnel.
6703. Construction Manager/General Contractor method projects
shall progress as follows:
(a) (1) The department shall establish a procedure for the
evaluation and selection of a construction manager through a request
for qualifications (RFQ). The RFQ shall include, but not be limited
to, the following:
(A) If the entity is a partnership, limited partnership, or other
association, a list of all of the partners, general partners, or
association members known at the time of the bid submission who will
participate in the Construction Manager/General Contractor method
contract, including, but not limited to, subcontractors.
(B) Evidence that the members of the entity have completed, or
demonstrated the experience, competency, capability, and capacity to
complete projects of similar size, scope, or complexity, and that
proposed key personnel have sufficient experience and training to
competently manage and complete the construction of the project, as
well as a financial statement that assures the department that the
entity has the capacity to complete the project, construction
expertise, and an acceptable safety record.
(C) The licenses, registration, and credentials required to
construct the project, including information on the revocation or
suspension of any license, registration, or credential.
(D) Evidence that establishes that the entity has the capacity to
obtain all required payment and performance bonding, liability
insurance, and errors and omissions insurance.
(E) Any prior serious or willful violation of the California
Occupational Safety and Health Act of 1973, contained in Part 1
(commencing with Section 6300) of Division 5 of the Labor Code, or
the federal Occupational Safety and Health Act of 1970 (Public Law
91-596), settled against any member of the entity, and information
concerning workers' compensation experience history and worker safety
program.
(F) Information concerning any debarment, disqualification, or
removal from a federal, state, or local government public works
project. Any instance in which an entity, its owners, officers, or
managing employees submitted a bid on a public works project and were
found to be nonresponsive, or were found by an awarding body not to
be a responsible bidder.
(G) Any instance in which the entity, or its owners, officers, or
managing employees, defaulted on a construction contract.
(H) Any violations of the Contractors' State License Law (Chapter
9 (commencing with Section 7000) of Division 3 of the Business and
Professions Code), excluding alleged violations of federal or state
law including the payment of wages, benefits, apprenticeship
requirements, or personal income tax withholding, or of the Federal
Insurance Contributions Act (26 U.S.C. Sec. 3101, et seq.)
withholding requirements settled against any member of the entity.
(I) Information concerning the bankruptcy or receivership of any
member of the entity, including information concerning any work
completed by a surety.
(J) Information concerning all settled adverse claims, disputes,
or lawsuits between the owner of a public works project and any
member of the entity during the five years preceding submission of a
bid pursuant to this section, in which the claim, settlement, or
judgment exceeds fifty thousand dollars ($50,000). Information shall
also be provided concerning any work completed by a surety during
this period.
(K) In the case of a partnership or other association that is not
a legal entity, a copy of the agreement creating the partnership or
association and specifying that all partners or association members
agree to be fully liable for the performance under the contract.
(L) For the purposes of this paragraph, a construction manager's
safety record shall be deemed acceptable if his or her experience
modification rate for the most recent three-year period is an average
of 1.00 or less, and his or her average total recordable
injury/illness rate and average lost work rate for the most recent
three-year period does not exceed the applicable statistical
standards for its business category or if he or she is a party to an
alternative dispute resolution system as provided for in Section
3201.5 of the Labor Code.
(2) The information required pursuant to this subdivision shall be
verified under oath by the entity and its members in the manner in
which civil pleadings in civil actions are verified. Information that
is not a public record pursuant to the California Public Records Act
(Chapter 3.5 (commencing with Section 6250) of Division 7 of Title 1
of the Government Code) shall not be open to public inspection.
(b) For each RFQ, the department shall generate a final list of
qualified persons or firms that participated in the RFQ prior to
entering into negotiations on the contract or contracts to which the
RFQ applies.
(c) (1) For each contract included in the RFQ, the department
shall enter into separate negotiations for the contract with the
highest qualified person or firm on the final list for that contract.
However, if the RFQ is for multiple contracts and specifies that all
of the multiple contracts will be awarded to a single construction
manager, there may be a single negotiation for all of the multiple
contracts. The negotiations shall include consideration of
compensation and other contract terms that the department determines
to be fair and reasonable to the department. In making this decision,
the department shall take into account the estimated value, the
scope, the complexity, and the nature of the professional services or
construction services to be rendered. If the department is not able
to negotiate a satisfactory contract with the highest qualified
person or firm on the final list, regarding compensation and on other
contract terms the department determines to be fair and reasonable,
the department shall formally terminate negotiations with that person
or firm. The department may undertake negotiations with the next
most qualified person or firm on the final list in sequence until an
agreement is reached or a determination is made to reject all persons
or firms on the final list.
(2) If a contract for construction services is entered into
pursuant to this chapter and includes preconstruction services by the
construction manager, the department shall enter into a written
contract with the construction manager for preconstruction services
under which contract the department shall pay the construction
manager a fee for preconstruction services in an amount agreed upon
by the department and the construction manager. The preconstruction
services contract may include fees for services to be performed
during the contract period provided, however, the department shall
not request or obtain a fixed price or a guaranteed maximum price for
the construction contract from the construction manager or enter
into a construction contract with the construction manager until
after the department has entered into a services contract. A
preconstruction services contract shall provide for the subsequent
negotiation for construction of all or any discreet phase or phases
of the project.
(3) A contract for construction services shall be awarded after
the plans have been sufficiently developed and either a fixed price
or a guaranteed maximum price has been successfully negotiated. In
the event that a fixed price or a guaranteed maximum price is not
negotiated, the department shall not award the contract for
construction services.
(4) The department is not required to award the construction
services contract.
(5) Construction shall not commence on any phase, package, or
element until the department and construction manager agree in
writing on either a fixed price that the department will pay for the
construction to be commenced or a guaranteed maximum price for the
construction to be commenced and construction schedule for the
project. The construction manager shall perform not less than 30
percent of the work covered by the fixed price or guaranteed maximum
price agreement reached. Work that is not performed directly by the
construction manager shall be bid to subcontractors pursuant to
Section 6705.
6704. (a) Any construction manager that is selected to construct
a project pursuant to this chapter shall possess or obtain sufficient
bonding to cover the contract amount for construction services and
risk and liability insurance as the department may require.
(b) Any payment or performance bond written for the purposes of
this chapter shall be written using a bond form developed by the
department.
6705. All subcontractors bidding on contracts pursuant to this
chapter shall be afforded the protections contained in Chapter 4
(commencing with Section 4100) of Part 1. The construction manager
shall do all of the following:
(a) Provide public notice of the availability of work to be
subcontracted in accordance with the publication requirements
applicable to the competitive bidding process of the department.
(b) Provide a fixed date and time on which the subcontracted work
will be awarded in accordance with the procedure established pursuant
to this chapter
(c) Comply with any subcontracting procedures adopted by the
department that were included in the department's RFQ. If the
department has adopted procedures to prequalify public works
contractors, the construction manager may use the procedures to
prequalify subcontractors.
6706. The department may retain the services of a design
professional or construction project manager, or both, throughout the
course of the project in order to ensure compliance with this
chapter.
6707. Contracts awarded pursuant to this chapter shall be valid
until the project is completed.
6708. Nothing in this chapter is intended to affect, expand,
alter, or limit any rights or remedies otherwise available at law.
SEC. 2. No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution because
the only costs that may be incurred by a local agency or school
district will be incurred because this act creates a new crime or
infraction, eliminates a crime or infraction, or changes the penalty
for a crime or infraction, within the meaning of Section 17556 of the
Government Code, or changes the definition of a crime within the
meaning of Section 6 of Article XIII B of the California
Constitution.