JOB ORDER CONTRACTING. United Brotherhood of Carpenters and Joiners Interior-Exterior Systems Leadership Conference
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1 JOB ORDER CONTRACTING United Brotherhood of Carpenters and Joiners Interior-Exterior Systems Leadership Conference March, 2015
2 AGENDA Who is the Gordian Group Introduction to Job Order Contracting Explanation of JOC Concept Competitive Bidding Process Procedures for Developing a Job Order Benefits of Job Order Contracting
3 WHO WE ARE The Gordian Group Provides Construction Procurement Services To Facility and Infrastructure Owners Public and Private Owners from Every Sector Our Mission To Support Organizations Pursuing Efficient and Effective Construction Procurement and Information Solutions with a Variety of Products and Services Built on Three Pillars 1. Data 2. Software 3. Expertise The Gordian Group is not a contractor We are a consultant specializing in innovative procurement solutions, based on our unique capabilities with construction data, software and expertise.
4 INTRODUCTION TO JOC Our Most Widely-used Procurement Solution is Job Order Contracting (JOC) Job Order Contracting Provides: A Means 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 Types of Work to be Completed: Straightforward, Renovation, Upgrade, Replacement in Kind Projects Focus on Projects that Exceed Competitive Bidding Threshold JOC is an innovative method of procurement, but construction is delivered in the typical way
5 JOC - BACKGROUND Introduced In the United States in 1985 Dept. of Defense, NASA, etc. Over 1,000 Contracts in Use Over $1.5 Billion of Construction Placed Annually Implemented by States, Counties, Major Cities, Universities & Private Owners New York State Office of General Services United States Postal Service Los Angeles Unified School District City of Chicago Department of General Services New York City Department of Education Florida Power & Light The Pennsylvania State University New Jersey Department of Transportation Georgetown University
6 SAMPLE STATEWIDE PROGRAMS Statewide Programs are Shared Among Many Users, and often Referred to as Cooperative Purchasing. Connecticut Capitol Region Council of Governments Pennsylvania Keystone Purchasing Network Maryland, Virginia, and District of Columbia - NJPA Georgia Department of Administrative Services Ohio Department of Administrative Services Michigan - NJPA Minnesota NJPA Texas Texas Buy Board Arizona Department of Administrative Services New Jersey Middlesex Regional Education Services Commission
7 WHY JOB ORDER CONTRACTING? Traditional Bid System can be Slow and Costly Months (Sometimes Years) from Project Identification to Contract Prepare Full Set of Bid Documents, Advertise, Conduct Pre-bids and Bid Openings, and Formally Award Contracts Owner May not be Happy with Low Bidder; Contractor Reputation and Quality is Meaningless Adversarial Relationship Between Owner and Contractor Administrative, Pricing and Scheduling Issues with Change Orders JOC Offers a Cost Effective & Efficient Alternative Faster Response; Days or Weeks instead of Months Traditional Bid Process Conducted Once, Not Over and Over. Well Defined, Goal Oriented Administration Owner and Contractor Work in Partnership No Negotiation of Change Orders; Prices are Known Upfront Transparent, Documented Process Fully Auditable Performance Based System Rewards High-Quality Contractors
8 UNION CONTRACTING, JOC AND GORDIAN JOC is Simply a Procurement Method Like Design-Bid-Build, Design-Build, T&M, etc. JOC Neither Favors Nor Harms Union Construction The Gordian Group Does Support Union Construction Safety, Efficiency, Productivity and Availability of Workforce High-Quality, High-Efficiency Contractors with Reputation of Success The Gordian Group Supports Increased Bidder Standards Around the Country Pre-qualification of Bidders, Best-Value Selection of Contractors, OSHA 30-Hour Workforce Training, Apprenticeship Where Authorized by Law, Gordian Recommends these tools to Clients Where Not Authorized by Law, Gordian is Working with Interested Partners in the Construction Community to Authorize these Provisions Gordian Wants a Partnership with Carpenters and Carpenter Contractors
9 GORDIAN S JOC DELIVERY MODEL
10 JOC CONTRACT DOCUMENTS 1. Front End Documents Information for Bidders Bid Forms Scope of Work General Conditions Insurance Requirements Defines Geographic Area Estimated Annual Values
11 JOC CONTRACT DOCUMENTS 2. Construction Task Catalog Catalog of over 275,000 Pre-Priced Tasks Based on Local Prevailing Wage Rates, Local Material & Equipment Costs Customized task description, unit of measurement, and unit price
12 JOC CONTRACT DOCUMENTS 3. Technical Specifications Specifies Quality of Materials and Workmanship Corresponds with Tasks in the Construction Task Catalog 12
13 OPTIONS FOR JOC CONTRACTS JOC for Different Trades: GC, HVAC, Electric, Plumbing: Separate Regions, or Building Types, or Departments
14 PRE-BID GUIDANCE TO CONTRACTORS Review Construction Task Catalog in Detail Present Examples of Price Proposals Prior to Bidding Owner Does Not Commit to: Any Specific Project Any Specific Quantities or Tasks Owner Does Commit to: Fixed Contract Term e.g., one year, two years. Fixed Geographic Area Guaranteed Minimum Value of Work $10,000, $25,000, $50,000, etc. Estimated Annual Value or Maximum Contract Value $1,000,000, $5,000,000, etc., Depending on Trade and Region
15 JOC BIDDING PROCESS Public Owners Award Based on Competitive Bid Contractors Bid Adjustment Factors to be Applied to the Preset Unit Prices in the Construction Task Catalog Normal Working Hours: 7:00 am to 4:00 pm Monday Friday Other Than Normal Working Hours: 4:00 pm to 7:00 am Monday Friday, and all day Saturday, Sunday and Holidays Adjustment Factors Apply to All Tasks in the Task Catalog Each Adjustment Factor is Weighted and Combined Lowest Combined Adjustment Factor From a Responsive, Responsible Bidder Wins! Private Owners and some Public Owners can Award JOC Contracts Based on Other Factors Best Value or Qualification Based Selection Process Bid to a Prequalified Group of Contractors
16 PRICE PROPOSAL FORMULA JOC is not a Time and Materials Contract Contractors Paid for Each Task Performed Importance of Adjustment Factors Determines Winning Bidder AND Used to Price Individual Job Orders Price Proposal Total = Lump Sum Job Order Price
17 Joint Scope Meeting Review Detailed Scope of Work Discuss Schedule Request for Proposal Contractor Develops Proposal Selects Tasks and Quantities Basic Work Schedule Subcontractor Plan Contractor s Proposal Reviewed Owner Reviews Proposal Contractor Makes Required Changes Owner Issues Lump Sum Job Order JOC EXECUTION PROCESS
18 JOC MANAGEMENT SOFTWARE Internet Based Software Provided with Contract egordian Software Automates the Proposal Process Generates all Forms and Management Reports 18
19 ADMINISTERING JOC CONTRACTS Owner Holds all Contracts with JOC Contractors Owner Can Manage JOC Process with In-House Staff Joint Scope Meetings Prepare Detailed Scopes of Work Review Price Proposals Manage Construction Owner Can Engage Construction Manager to Manage JOC Process, or Certain Portions of Process Owner Can Engage A/E Professionals to Prepare Detailed Scopes of Work
20 CONTRACT DETAILS Payment and Performance Bonds Can be Required at Award for Full Contract Value, or for each Job Order Alternatively, Owner may not Require Bonds Can be Included in Adjustment Factor or Reimbursed for each Job Order Differing Site Conditions Priced from Construction Task Catalog No Negotiated Change Orders Developed Just Like Original Job Order Joint Scope Meeting, Detailed Scope of Work, RFP and Price Proposal Filings and Permits Fees Paid for All Permits; Reimbursed 100% Subcontracting Requirements Owner may Incorporate MBE/WBE Requirements
21 WHY JOC WORKS JOC Addresses a Series of Individual Projects with a Single Competitively Bid Contract Contractor Has a Continuing Financial Incentive To Provide: Responsive Services Accurate Price Proposals Deliver Quality Work on Time Future Job Orders Tied to Contractor Performance No Obligation To Award Specific Projects Contractor not Guaranteed Specific Volume of Work High-Quality Contractors are Rewarded with More Projects Not Restrictive; Owner Can Use All Other Methods to Complete Work
22 JOC SAVES TIME & MONEY Los Angeles Unified School District Calculated cost savings of 9.26% for 2,587 JOC projects reviewed. New York State University Construction Fund Found an average cycle time for a JOC project from Project Initiation to Job Authorization is 15 days compared to 95 days for a traditional construction project, a savings of 80 days. New Jersey Department of Transportation Found JOC contracts are 12% more cost effective than Time & Material contracts Chicago Board of Education Average cost savings of 8.6% for all City JOC contracts. New York City Board of Education Discovered the average duration from project identification to issuance of the Job Order is 42 days, compared with an average duration of approximately seven (7) months under the traditional system, an 80% time savings. City of Miami Beach JOC tripled the volume of projects completed, decreased procurement time by 89%, and eliminated change orders, protests and litigation. Won the Best of the Best Award from the National Institute of Governmental Purchasing (NIGP)
23 SUMMARY JOC is a Proven System with a 30-Year Track Record of Success Over $1.5 Billion of Construction Completed Each Year Enables Owners to Complete a Series of Individual Projects with a Single Competitively Bid Contract Fixed Pricing for all Work Eliminates the Need to Negotiate Change Orders JOC Saves Money JOC Saves Time Increases Options for Owner to Complete More Work Gordian wants to partner with you Lobby to Improve Bidder Standards Encourage More Carpenter Contractors to Bid JOC Contracts
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