Job Order Contracting Industry Information Session

Transcription

1 Job Order Contracting Industry Information Session DECEMBER 9,

2 Agenda JOC Overview Benefits of JOC to Contractors JOC Contract Documents JOC Process JOC Management Software Understanding the CTC Calculating the Bid Bid Considerations Summary Questions 2

3 JOC Overview Job Order Contracting is an Indefinite Quantity Construction Contract Provides the Ability to Accomplish a Substantial Number of Individual Projects with a Single Competitively Bid Contract On-Call Contractors Ready to Perform a Series of Projects at Different Locations for Competitively Bid Prices JOC is a Prevailing Wage Rate Contract Focuses on Small to Medium Sized Routine Projects 3

4 30 Year Track Record of Success JOC Introduced in the United States in 1985 Dept. of Defense, USPS, NASA, etc. JOC Overview Implemented by States, Counties, Cities, K-12 Schools, Transportation Agencies, Universities, Housing Authorities, etc. since 1990 More than 1,000 Contracts Currently in Use Over $1.5 Billion in Construction Placed Annually 4

5 JOC Overview New York State Department of Transportation has been using JOC for Over 10 Years More Than $65,000,000 in Completed Work More Than 1,700 individual Projects 22 Active JOC Contracts in 11 Regions No Bid Protests, No Claims, No Lawsuits Endorsed by Trade Associations: AGC, STA, etc. Pennsylvania Turnpike Commission has been using JOC for 6 Years with Similar Results 5

6 Time Savings JOC Overview - Efficiency Faster Procurement Weeks Instead of Months Based on Owner-Contractor Partnership = Non-Adversarial Relationship 6

7 JOC Overview Owner Cost Savings Cost of Construction: 3-6% Contractor Offers Discount because Bidding a Large Volume of Work, not One Small Project Lower Procurement Costs: 1-2% Eliminates the Full Procurement Cycle for Each Project Fewer Change Orders and No Claims: 1-2% Joint Scoping Process Eliminates Misunderstandings Detailed Scope of Work Agreed to in Advance Reduction of A/E fee: 3-5% No Need to Prepare Full Plans and Specs for each Project Total: 8-15% 7

8 Benefits of JOC for Contractors Why JOC Works for Contractors Can Complete a Series of Projects by Bidding One Contract Fast Track Procurement Process Limited Geographic Area and Type of Work to be Performed Joint Scope Process Decreases Unknowns and Risks Contractor has Input into Construction Schedule Contractor Paid for Each Task Performed Can Develop Long Term, Non-Adversarial Relationship with Owner Simplified Unit Pricing for all Changes, Deletions, and Extras Contractor can Increase Volume of Work by Providing Responsive Services, Quality Work on Time and Safely 8

9 Umbrella Contract 9

10 Process -How Work is Done Scope Development Joint Scope Meeting With Owner to define Detailed Scope of Work Owner Issues RFP to Contractor to Prepare Proposal Contractor Prepares Proposal Typical Proposal Due Date will be 1-2 weeks from RFP Owner Reviews Proposal Owner Issues Job Order Total Time: Average 2-3 Weeks 10

11 Front End Documents Construction Task Catalog Technical Specifications JOC Contract Documents 11

12 Front End Documents Standard Terms and Conditions Instruction to Bidders Bid Forms Insurance Requirements Bond Requirements Warranty Liquidated Damages Etc. JOC Contract Documents 12

13 JOC Contract Documents Construction Task Catalog (CTC) Based on Prevailing Wage Rates, Local Material & Equipment Costs Description of Task Installation Price Modifiers for Quantity Discounts, Change in Material, etc. Demolition Price 13

14 JOC Contract Documents 14

15 JOC Contract Documents Technical Specifications NJDOT Standard Specifications Specifies Quality of Materials and Workmanship Tasks in the Construction Task Catalog based on NJDOT Specifications 15

16 JOC Process How is JOC Bid? Award Based on Competitive Bid from Qualified NJDOT Contractor Must Bid Adjustment Factors: Normal Working Hours Other Than Normal Working Hours or when NJDOT can only provide less than 7 hour access to worksite Adjustment Factors Apply to All Tasks in the CTC Each Adjustment Factor is Weighted Lowest, Responsive, Responsible Bidder Wins! 16

17 JOC Management Software Options Internet Based Software Provided to Contractors egordiansoftware Automates the Price Proposal Process No Cost to Contractors for Software License or Training 17

18 Understanding the CTC Contractor must read and understand Using the Construction Task Catalog Presents the General Rules: Unit Prices include Labor, Material and Equipment Explains what Costs are Included in Unit Prices Explains when Contractor gets paid for Scaffolding, Lifting Equipment Always paid for Dumpsters and Removal of Excess Material Always paid for Mobilization of Equipment and Certain Crews: e.g. Guiderail Crew Explains what is included in Adjustment Factors Will be Discussed in Detail at PreBid Conference 18

19 Include All Appropriate Tasks: Understanding the CTC Cast In Place Concrete Sidewalk SF $ $2, For Quantities 100 to 500, Add SF $ $ Crushed Aggregate Base SF $ $ For Quantities Under 1000 SF $ $ Mobilize Backhoe EA $ $ Excavation by Backhoe CY $ $41.25 For Quantities Under 20 CY, Add CY $ $ Loading Excess Materials CY $ $47.03 For Quantities Under 20 CY, Add CY $ $ Hauling to Dump Site CYM $ $ Landfill Dump Fee CY $ $ $4, /400 $10.14 Compare These Prices 19

20 Non-Prepriced Tasks For Tasks not in Construction Task Catalog Formula Appears in JOC Contract Three Quotes for Materials or Subcontractor Use Labor Rates and Equipment Rates in Construction Task Catalog if Work is Self Performed Pre-Set Mark Up in the Contract Documents 20

21 Bidding Adjustment Factors Use Historical Project Data Select a Completed Project You Know Scope and Direct Costs You Know the OH & Profit Achieved Price Project From CTC Calculate the Adjustment Factor Create a Representative Project Create a Scope of Work Get Sub Quotes or Estimate Cost Price Project From CTC Add on Overhead and Profit Calculate the Adjustment Factor Sampling Method Evaluate a Sampling of the Anticipated Items 21

22 Bidding Adjustment Factors Whoever Prepares Bid Must Read and Understand Using the Construction Task Catalog Volume of Work What Volume of Work Should You Assume? Type of Work Assigned Location of Work Limited Geographic Area Your Staffing Plan How Many Individuals Type of Individuals High Quality, Skilled Management Quality of Subcontractors and Work 22

23 Detailed Scope of Work Bridge Deck Rehabilitation Various Locations Concrete Repair Remove 4 deep of concrete (12 width) on both sides of the joint Dowel in #5 epoxy coated reinforcement bar at 2 on center Tie epoxy coated mesh Install rapid set concrete Repair deck and curb line with rapid set concrete. Reinforce with epoxy coated mesh and pin. Joint Repair Remove existing joint material and clean out opening Insert backer rod Place approved joint sealant 23

24 Bidding Adjustment Factors Direct Cost of Work from CTC Cost of Work from Quotes or In-House Estimates Concrete Repair $ 34, Joint Repair $ 22, TOTAL = $ 56, Concrete Repair $ 31, Joint Repair $ 22, TOTAL = $ 53,

25 Overhead Costs Overhead Costs: Joint Scoping Proposal Development Site Supervision and Management Bonds Insurance Vehicles Safety Supervisor, Training Home Office Support Communications Incidental Design Site Specific Safety Plans 25

26 Bidding Adjustment Factors A. Direct Cost of Work $ 53, B. Overhead 10%* $ 5, C. Subtotal (Cost & O/H) $59, D. Profit 10%* $ 5, E. Subtotal (Cost & O/H & Profit) $65, F. Price From CTC $56, Adjustment Factor (= E / F) *

27 Bid Considerations Must Meet NJDOT Qualification Requirements Must have Required Insurance and Bonding Must be Able to Manage Multiple Projects at Multiple Sites Previous JOC Experience NOT Required. The Gordian Group will Provide Training on the JOC Process, Software, and other JOC Related Activities. 27

28 Contractor Adjustment Factor Importance of Adjustment Factors Determines Winning Bidder Used to Price Individual Job Orders 28

29 Risks of Low Adjustment Factor A Low Adjustment Factor Leads to Arguments in Proposal Review Unsupportable Items Exaggerated Quantities Leads to Delays in Job Order Development Takes Longer to Review Proposals Creates an Adversarial Relationship Reduced Volume of Work Will Shorten Contract Lost Profitability No Change Orders to Improve the Margin 29

30 Review / Key Points JOC has a 30 Year Track Record of Success Contractors can Receive a Large Number of Projects with one Competitive Bid Simplified Process to Develop each Job Order Contractor has Input into Detailed Scope of Work and Construction Schedule Limited Geographic Region and Specified Type of Work Contractor Paid for Each Task Performed Simplifies Pricing for Changes, Deletions, and Extras Can build Long Term, Non-Adversarial Relationship with Owner 30

31 Questions? Questions and Open Discussion 31