9/13/2016. QBS From An Engineering Firm s Perspective. Hello. QBS From An Engineering Firm s Perspective. Starting Thoughts About QBS

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1 Hello Van Collins President/CEO American Council of Engineering Companies of Washington (425) Starting Thoughts About QBS Washington Follows the Example of Federal Law (i.e. Brooks Act) One of 44 States that have state QBS Laws Architecture and Engineering Services are Unique QBS Protects the Safety, Health and Welfare of the Public QBS Saves Money QBS Does NOT Eliminate Price Considerations Improper or Unknowing Implementation of QBS Hurts Projects and Often Impedes Public Policy Concerns Why Did The Legislature Enact QBS? RCW Legislative declaration. The legislature hereby establishes a state policy, to the extent provided in this chapter, that governmental agencies publicly announce requirements for architectural and engineering services, and negotiate contracts for architectural and engineering services on the basis of demonstrated competence and qualification for the type of professional services required and at fair and reasonable prices. 1

2 Why Did The Legislature Enact QBS? Clearly Different Than The Procurement Of Construction Services What is Unique About Architecture and Engineering? Scope Determination, Consultation, Investigation, Evaluation, Planning and Design are Very Often Determined After Performance Of The Contract Has Begun And Are Iterative In Nature Scope Determination, Consultation, Investigation, Evaluation, Planning, and Design are all Collaborative And Innovative Processes To Be Effective, Collaboration and Innovation Require A Positive, Partnering, and Creative Atmosphere Which Values Communication and Joint Respect What Are The Takeaways From Understanding This Policy? The Legislature Understood That QBS Is All About Setting A Stage That Will Result In The Best Value And Outcomes For the Public Interest Procurement of A/E Services Is Fundamentally Different Than The Procurement of Construction Services Because The Performance Of The Work Is Fundamentally Different QBS Is Not A Mechanical Procedure to Be Followed Unthinkingly. The Focus Is On Qualifications In The Initial Stage For A Reason Price is Relevant But Not Until The Best Team Has Been Identified For The Project In Question What Are The Takeaways From Understanding This Policy? Creativity and Innovation Ultimately SAVE Money Negotiation Should Not Become Adversarial And Contract Terms Should Not Be So Inequitable That They Negatively Impact The Creative Environment (i.e. Fair and Reasonable) Requires Public Owners To Understand Consultants Business Models And How Contract Terms (Both Risk and Pricing) Impact Them, Their Subconsultants, and Their Combined Performaces 2

3 When Does QBS Apply? "Architectural and engineering services" or "professional services" means professional services rendered by any person, other than as an employee of the agency, contracting to perform activities within the scope of the general definition of professional practice in chapters 18.08, 18.43, or RCW. RCW : (4) "Engineering" means the "practice of engineering" as defined in this section. (5)(a) "Practice of engineering" means any professional service or creative work requiring engineering education, training, and experience and the application of special knowledge of the mathematical, physical, and engineering sciences... to such professional services or creative work as consultation, investigation, evaluation, planning, design, and supervision of construction for the purpose of assuring compliance with specifications and design, in connection with any public or private utilities, structures, buildings, machines, equipment, processes, works, or projects. Notice Two Concepts: QBS Applies When There Is A Certain Skillset In Play (Specify Education, Training, Knowledge, and Experience) And That Skillset Is Applied To Certain Activities Consultation Investigation Evaluation Planning Design Supervision of construction for the purpose of assuring compliance with specifications and design 3

4 What Obligation Do Public Owners Have In Relation To the Engineers Licensing Statute? RCW Violations and penalties..... It shall be the duty of all officers of the state or any political subdivision thereof, to enforce the provisions of this chapter. The attorney general shall act as legal adviser of the board, and render such legal assistance as may be necessary in carrying out the provisions of this chapter. What Does This Mean? QBS Can Apply To Scopes of Work In ALL Phases Of The Construction Process It Does Not Matter What You Call The Activity Or When The Activity Is Performed. Engineering Occurs When The Skillset Of An Engineer Is Utilized Public Owners Have A Direct Duty To Ensure That Activities Which Are Engineering As Defined In The Licensing Statutes Are Also Procured Properly Through QBS Planning Example Scope of Project The project shall consist of the following facilities needs assessment and facilitating long term facility planning and community outreach services with regard to the [facility]: Review and assess current facilities conditions by site visit and review of current [state] data and study and survey information Conduct outreach to seek task force members from all components of the community Develop a meeting schedule that will provide a final plan to the [executive] by [Date] Facilitate [owner] meetings to provide the following information in a final report: 4

5 Planning Example 1. A determination of whether a grade-separated railroad crossing is needed and/or feasible. 2. An analysis of alternative roadway alignments and/or interchange locations. 3. A funding estimate of the preferred transportation solutions in the [Road] corridor to aid in pursuing funding opportunities. This type of planning requires the use of the training, knowledge, and experience of an engineer to accomplish and is therefore the practice of engineering. The QBS Process The Legislature s Intent Is Instructive RCW Legislative declaration. The legislature hereby establishes a state policy, to the extent provided in this chapter, that governmental agencies publicly announce requirements for architectural and engineering services, and negotiate contracts for architectural and engineering services on the basis of demonstrated competence and qualification for the type of professional services required and at fair and reasonable prices. What Does Negotiation Of Contracts Mean? It Is A Give And Take Process Requires Both Sides To Actively Engage In Good Faith Requires Both Sides To Understand The Other s Priorities and Needs To Be Most Effective Trust Is An Essential Component Non-Negotiable Terms Are Clear Signs Of Distrust And/Or Concern About A Public Owner s Own Proficiency At Negotiating Non-Negotiable Terms Defeat The Intent Of QBS 5

6 Why Does It Matter? Inequitable Risk Terms Inhibit Creativity And Innovation Creates Cookie Cutter, Tried And True Results Which Might Not Be The Best Solution For A Project Incentivizes Overdesign of Projects Which Creates Hidden and Unnecessary Costs Through The Flowdown Of Contract Terms, Often Create Even More Hardship for Subconsultants Why Does It Matter? Inequitable Pricing Terms Places Pressure On Projects From The Start And Creates An Adversarial Rather Than Collaborative Atmosphere Creates Incentives For A/Es To Cut Corners Or Use Less Experienced Personnel On Projects Leads To More Claims, Errors, and Conflict Will Often Create Hardship for Subconsultants Unexpected Consequences - Effects On Subconsultants and Especially SMWBEs Utilization of Small, Minority and Women Owned Businesses (SMWBE) Is Being Stressed More and More In Today s Procurements Subconsultants Are Especially Hard Hit By QBS Procedures That Are Adversarial Or Result In Inequitable Contracts SMWBE s Are Primarily Subconsultants Prime Consultants Are Structurally Disincentivized From Using Subconsultants In General And Especially SMWBE s 6

7 Closing Thoughts The Legislature Has Recognized That A/E Services Are Unique And That Negotiation Of Contracts At Fair And Reasonable Prices Serves the Public Interest Procurements That: Limit Or Create Adversarial Negotiations Seek To Unduly Impose Unreasonable Risk Allocations, and Do Not Seek To Fairly and Reasonably Compensate A/E Consultants Violate The Intent of The State s Laws And Result In Projects That Negatively Impacted Both In Terms Of Quality and Cost Public Owners Often Deride Low-Bid Procurement For Construction Services Where Price Is Paramount. Why Does It Make Sense To Want To Move A/E Procurements Closer To Low Bid? Thank You Questions? 7