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Contractor Pre-QualificationAll You Need to Know

CMAA Legal Committee

March 12, 2015

Panel Members & Seminar Leader

Panel Participants:•Mark Hovatter, Chief Facilities Executive

Los Angeles Unified School DistrictBryan Payne, Director – Contract AdministrationBuild LACCD Program Management Office

•Mark Rose, P.E., Asst. Chief Harbor Engineer – Construction Division Port of Los Angles•Todd Cozolino, Associate Principal

Spire Consulting Group

Seminar Leader•Terry Tao, AIA, Partner

Atkinson, Andelson, Loya, Ruud & Romo

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Purposes for Prequalification

• Helps to create a pool of contractors that have the quality, capacity and ability to perform work on projects of a particular size and complexity

• Weeds out contractors with a history of litigation, claims, and performance failures

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Basics of Prequalification

• Public Contract Code 20101– Standardized questionnaire and financial statement as developed by

DIR

• Developed in conjunction with cities, counties, construction industry, surty industry and other interested parties

– Experience performing public works

– Verified under oath

– Financial statements

– Not public records/confidential

– Due process rights

– Uniform System

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Other Prequalification Statutes

– Public Contract Code Section 20111.5 (Schools non-State Funded)

– Public Contract Code Section 20111.6 (Schools State Funded)

• Projects over $1 million

• Mechanical, Electrical, and Plumbing Subcontractors

– Public Utilities Code Section 130051.21 (MTA)

– Public Contract Code Section 10760 (Cal State)

– Public Contract Code Section 10303 (DGS)

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LOS ANGELES UNIFIED SCHOOL DISTRICTFACILITIES SERVICES DIVISIONFACILITIES CONSTRUCTION CONTRACTS

THE DISTRICT’S PREQUALIFICATION PROGRAM

Mark Hovatter, Chief Facilities Executive

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Pre-Qualification Program

It is the intent of the District to do business with quality contractors by identifying such contractors through a uniform system of rating bidders to obtain the best quality construction for the lowest price practicable under the circumstances.

The District’s prequalification programs are adopted pursuant to Public Contract Code 20111.5, 20111.6 and 20919.4.

Requires all contractors interested in bidding either formal or informal, competitively bid public works projects to prequalify before submitting a bid to the District

Provides standard on-going prequalification enrollment for prospective bidders

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Pre-Qualification Types

Safety (Informal) Prequalificationo Required to bid informal contracts and other projects for which

safety prequalification is required.

Subcontractor Prequalification o Required for first-tier subcontractors

Formal Prequalificationo Required to bid formal contracts, JOC Contracts, 17406

Project-Specific Prequalification

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Changes to Pre-Qualification Programs

Effective April 15, 2015

• Subcontractor Prequalification will apply to all listed subcontractors.

• If safety prequalified only, subcontractors must complete Prime or Subcontractor questionnaire.

• The list of Approved Subcontractors will be posted on the Facilities Contracts web site.

• Prime and subcontractors must be approved at least five days prior to bid date.

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DIR Public Works Contractor Registration Requirements

• Senate Bill 854 - public works contractor registration program.

• Effective March 1, 2015 - All Contractors and subcontractors listed on a bid must be registered (informal, formal and JOC).

• Effective April 1, 2015 - All contractors and subcontractors working on any public works contract awarded on or after this date must be registered.

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Formal & Subcontractor Pre-Qualification

• Complete the most current Prime Contractor Prequalification Questionnaire or Subcontractor Prequalification Questionnaire

• Have a current and active California Contractors License

• Receive and maintain Safety Approval via the Safety Prequalification section of the Questionnaire

• Meet Part II: Mandatory Requirements• Achieve passing score on PART V. Scorable

Questions• Provide bonds by a California-admitted surety

company

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Formal & Subcontractor Pre-Qualification

Provide proof of Workers’ Comp and Liability coverage by an Insurance Company licensed to do business in California

Provide references of projects completed within the last 36 months

Submit a current financial statement (at least balance sheet and income statement)

Achieve passing Contractor Performance Score

Prequalification approval is valid for one (1) year

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Contractor Performance Score

Contractor performance history will be measured according to two separate components, Field and Compliance.

Field Component (Maximum Score 50, Passing Score 35)

◦ Average score of Contractor Performance Evaluations for the last three (3) LAUSD contracts.

◦ Applicant must receive an average score of at least 35 points to prequalify.

Contractors with no LAUSD contract history will receive a default score of 40.

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Compliance Component

(Maximum Score 50, Passing Score 35):

1.Labor Compliance

2.Project Stabilization Agreement (PSA)

3.Bid Issues/Protests

4.Assessments

5.Failure to comply with LAUSD contract Warranty requirements

Contractors with no contract history with LAUSD will be given a default score of 50

For details, see Field and Compliance Scoring Summary on the Prequalification web page at http://www.laschools.org/new-site/prequalification/forms

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THREE LEVELS OF FORMAL PRE-QUALIFICATION BASED ON EXPERIENCE:

Level IEntitled to bid on contracts in an amount not to exceed $350,000.

Non-LAUSD experience: Within the past three (3) years, at least three (3) public or private works as either a prime contractor or a subcontractor with cumulative contract value totaling at least $500,000.

LAUSD experience: Within the past three (3) years, at least three (3) LAUSD contracts as either a prime contractor or a subcontractor, with cumulative contract value totaling at least $100,000.

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Level IIEntitled to bid on contracts in an amount not to exceed $5,000,000.Non-LAUSD experience: Within the past three (3) years, at least three (3) public or private works as a prime contractor, with cumulative contract value totaling at least $2,000,000.LAUSD experience: Within the past three (3) years, at least three (3) LAUSD contracts as a prime contractor, with cumulative contract value totaling at least $500,000.

THREE LEVELS OF FORMAL PRE-QUALIFICATION BASED ON EXPERIENCE:

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THREE LEVELS OF FORMAL PRE-QUALIFICATION BASED ON EXPERIENCE:

Level IIIEntitled to bid on contracts in an amount in excess of $5,000,000.

Non-LAUSD experience: Within the past three (3) years, at least three (3) public or private works as a prime contractor, with cumulative contract value totaling at least $10,000,000.

LAUSD experience: Within the past three (3) years, at least three (3) LAUSD contracts as a prime contractor, with cumulative contract value totaling at least $7,000,000.

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Prequalification Unit Contact Information

• Phone: (213) 241-2651

• Fax: (562) 654-9499

• Email: prequalification@laschools.org

• Web site: www.laschools.org/new-site/prequalification

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Practical Considerations in Prequalification Get the most out of it!

Todd Cozolino, Associate Principal

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Practical Considerations in Pre-Qualification Get the most out of it!

• Prequalification may be statutorily mandated, but it’s a best practice regardless. Embrace it, don’t resist it.

• Bid or Proposal Review is burdensome on the owner, particularly in alternative delivery methods; don’t waste administrative time reviewing proposals of firms that may not be able to perform.

• A company is only as good as the people it is made of; understand the individuals proposed for your project and enforce their assignment.

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Practical Considerations in Pre-Qualification Get the most out of it!

• Customize the qualifications to your project or group of projects; a data center contractor is not qualified to build a stadium, and vice versa.

• Make the process efficient and scalable; if you have a series of analogous projects, consider globally crafting the prequalification.

• Consider the effect on access and participation on the industry; would a stratified dollar amount pool system afford more opportunity?

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Practical Considerations in Pre-Qualification Get the most out of it!

• When requesting references and project lists, don’t allow “cherry picking;” create a system that is an accurate sample of performance.

• Consider the extent of specific jurisdictional experience limitations (e.g. OSHPD, DSA, etc.); are we eliminating highly qualified firms?

• Consider FOIA and CPRA Implications; delineate non-public documents and administer according to counsel’s advice.

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Los Angeles Community College DistrictPROGRAM MANAGEMENT SERVICES

PUBLIC CONTRACTING LAW AND

HOW TO BID ON BuildLACCD PROJECTS

Bryan PayneDirector, Contract Administration

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LACCD Overview

• Established in 1969

• Governed by seven-member Board of Trustees

• Nation’s largest community college district

• Encompasses 36 cities within 882 square miles

• Nine college campuses and two satellite campuses serve more than 149,000 students

• Build-LACCD managed by Program Management Office (PMO)

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Bond Measure

Year and Amount

Essential Purpose

Proposition A2001

$1.245 billion

To repair, rehabilitate, modernize, and construct new facilities at all nine colleges.

Proposition AA2003

$908 million

To repair, rehabilitate, modernize, and construct new facilities at all nine colleges.

Measure J2008

$3.5 billion

To further the colleges’ master plans, land acquisitions and the buyout of energy contracts.

“J is for Jobs”

Bond Program Overview – $6.26B

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College Projects Remaining

*Other includes demo, landscape/hardscape, parking, P.E. fields, roadways/street, stormwater, etc.

160+ Projects Remaining(Pre-Construction)

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Categories1) A-General Engineering Contractor2) B-General Building Contractor3) General Contractor with ADA Specific Experience4) Qualified SWPPP Developer, Qualified SWPPP Practitioner5) C-2 Insulation & Acoustical6) C-5 Carpentry7) C-7 Low Voltage Systems8) C-8 Concrete9) C-10 Electrical 10) C-12 Earthwork & Paving11) C-13 Fencing12) C-15 Flooring and Floor Covering13) C-16 Fire Protection14) C-20 Warm-Air Heating, Ventilating and Air Conditioning Contractor15) C-21 Building Moving/Demolition 16) C-27 Landscaping17) C-28 Lock & Security18) C-31 Construction Zone Traffic Control19) C-32 Parking & Highway Improvement20) C-33 Painting and Decorating 21) C-36 Plumbing22) C-39 Roofing23) C-42 Sanitation24) C-45 Electrical Signs25) ASB Asbestos Abatement26) HSR Hazardous Substance Removal

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• Section I– General Company Information

• Form of Company

• Key Personnel

• Contact Info

• Not Scored

• Section II– Part A – General Requirements

• Pass/Fail – yes/no questions

– Part B – General Qualifications• Scored

• Minimum passing score 80%

Prequalification Questionnaire – Attachment 1

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• Firm Experience & Key Personnel by Category– Scored– Minimum passing score 80%

• Describe Experience & Approach

• Key Personnel & Resumes

• 3 past projects in the last 10 years performing work in the category

Prequalification Questionnaire – Attachment 2

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• Firm Experience & Key Personnel by Category– Scored– Minimum passing score 80%

• Describe Experience & Approach

• Key Personnel & Resumes

• 3 past projects in the last 10 years performing work in the category

Prequalification Questionnaire – Attachment 2

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SB854 - CONTRACTOR REGISTRATION

• In June, 2014, Senate Bill 854 passed the State Legislature creating a public works contractor registration program.

• A contractor bidding or working on ANY public works contract within the Sate of CA must register online and pay an annual $300 fee.

• Effective March 1, 2015 ‐ All Contractors and subcontractors listed on a bid must be registered with the State.

• Effective April 1, 2015 ‐ All contractors and subcontractors working on any public works contract awarded on or after this date must be registered.

• Registration is an online process with the Dept. of Industrial Relations (DIR): http://www.dir.ca.gov/Public-Works/PublicWorks.html

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SB854 - CONTRACTOR REGISTRATION

• Bids can be deemed non-responsive if primes and listed subcontractor are not registered with DIR.

• Inadvertent listing of unregistered subcontractor at the time of bid doesn’t invalidate bid and may be cured.

• Failure to register is grounds for substituting subcontractors.

• Contract with unregistered contractor or subcontractor subject to cancellation but is not void.

• Lower tier subcontractors must also be registered. Tracking will be managed via certified payroll.

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ONLINE VENDOR REGISTRATIONwww.build-laccd.org

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ONLINE VENDOR PORTAL

1,200+ Firms RegisteredDiversity Reporting

http://www.planetbids.com/portal/portal.cfm?CompanyID=21372

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ONLINE VENDOR PORTAL REGISTRATION

• Must Register with LACCD PlanetBids Portal

• ALL information is put on PlanetBids

• NO contact with the District PMO via calls or email is allowed.– By directing all questions to PlanetBids all contractors receive

the same information

• Must Sign up for each Procurement to receive information about a particular project. We only send out notices to contractors who have signed up for that particular bid.– Option to sign up as bidder or non-bidder (to receive the

information only)

• LACCD uses existing business class categories in PlanetBids to define a firms area of work. Bid alert notifications are sent based on the categories selected. – Suggest contractors select General Contracting-236220 as

one of your categories (236220 is used on all our bids)

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Los Angeles Valley College

Valley Academic & Cultural Center(Formerly MAPA)

Northern end of the central mall

Architect: Steven Ehrlich ArchitectsConstruction Budget: $66MDelivery Type: Lease LeasebackProject Type: New ConstructionExpected RFQ/RFP Issuance Date: Mar 2015Expected Construction Commencement (Notice to Proceed): Aug 2015

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Los Angeles Pierce College

Expanded Automotive & New Technical Education Facilities

Architect: TBDConstruction budget: $ 27MDelivery Type: Lease LeasebackProject Type: New Construction & Renovation

Expected AOR RFQ/RFP Issuance Date: Mar 3, 2015Expected Construction RFQ/RFP Issuance Date: Mar 30, 2015Expected Construction Commencement (Notice to Proceed): Mar 2017

Campus Improvement Package(Construction Budget = $ 45.5M)

• Campus-Wide Utilities Extension $ 2.5M• Central Plant Expansion $ 6M• Mason Street Re-route $ 3.2M• Fire Access Road Improvements $ 379K• Parking Lots & Roadways $ 2.5M• Pierce Storm Water $ 3.4M

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Professional Services Procurements

Services Estimated Dates

Environmental Services

Bench Contracts

2015 Q2

Information Technology Support

Services Bench Contracts

2015 Q2

As-Needed

Project Specific

Architect and Engineer

Register online at planetbids.com

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For more information

www.build-laccd.org

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End