728P - Design-Build or Construction Management At Risk Contract Procedures

Pursuant to the Virginia Public Procurement Act, Virginia Code §§ 2.2 – 4300, et seq., and, specifically, to the special procedures and authority contained in Virginia Code § 2.2-4378 et seq. (collectively, the “VPPA”), the Frederick County School Board (the “Board”) has adopted the following as its procedures (the “Procedures”) for utilizing design-build or construction management at risk contracts (such contracts, the “Alternate Contract Structures”) for construction projects for the Frederick County Public Schools (“FCPS”):

Section I: Background and Recitals
  1. These Procedures only apply to procurement of construction projects under the VPPA using an Alternate Contract Structure. These Procedures do not apply to procurements (solicited or unsolicited) under the Virginia Public-Private Education Facilities and Infrastructure Act of 2002, Va. Code §§ 56-575.1, et seq. (the “PPEA”), to which the Board’s separate PPEA guidelines apply.

  2. Subject to these procedures, the Superintendent of Frederick County Public Schools (the “Superintendent”), or his or her designee, may, in instances where the eligibility criteria that permit the use of an Alternate Contract Structure under applicable Virginia law appear to be satisfied, recommend that the Board consider use of the Alternate Contract Structure. FCPS shall procure any such Alternate Contract Structure under the procurement method for procuring non-professional services through competitive negotiation for a construction project, rather than use of the three-step “design-bid-build” approach entered into through competitive sealed bidding.

  3. Use of an Alternate Contract Structure requires Board approval. Prerequisites for Board approval include the following:

    1. FCPS must have in its employ or under contract a Virginia licensed architect or engineer who has professional competence appropriate to the project to advise FCPS regarding use of the Alternate Contract Structure and who shall assist FCPS with preparation of the Request for Qualifications (“RFQ”), Request for Proposal (“RFP”), and evaluation of qualifications and proposals received in response to the RFQ and RFP. FCPS will procure such an architect or engineer through a normal procurement process under the VPPA or the PPEA; these Procedures apply to the procurement of the Construction Manager or the Design-Builder.

    2. The Superintendent or his or her designee must document in writing how, for the specific construction project, (i) an Alternate Contract Structure is more advantageous than a competitive-sealed-bid construction contract; (ii) there is a benefit to the FCPS by using an Alternate Contract Structure; and (iii) competitive sealed bidding is not practical or fiscally advantageous. The Superintendent or his or her designee shall sign this justification and retain it in the FCPS construction files for the project. The Board shall review the justification prior to approving the use of these Procedures for each recommended project.
Section II: General Requirements and Procedures for Both Alternate Contract Structures
  1. Any contract for an Alternate Design Structure must be for a fixed price or not-to-exceed price.

  2. FCPS shall conduct the procurement using these Procedures, consistently with the VPPA's procedures for competitive negotiation for other than professional services, and consistently with relevant standards and procedures that the Secretary of Administration and Division of Engineering and Buildings of the Commonwealth's Department of General Services, as applicable, have adopted. Such procedures include without limitation, those in the current edition of the Commonwealth of Virginia Construction and Professional Services Manual (the “Manual”), keeping in mind in every instance the local nature of FCPS projects. FCPS will initiate the procurement by an appropriately noticed RFQ and an RFP consistent with these Procedures.

  3. FCPS shall publish notice of its RFQ from potential offerors at least 30 days prior to the date set for receipt of qualifications by posting it so as to provide reasonable notice to the maximum number of offerors that can reasonably be anticipated to submit qualifications in response to the particular request. In addition, FCPS may solicit qualifications directly from potential offerors. The RFQ shall indicate in general terms what is sought to be procured, specifying the factors that FCPS will use to evaluate the potential offerors’ qualifications, and containing or incorporating by reference the other applicable contractual terms and conditions, including any unique capabilities or qualifications required of the offeror. The RFQ shall request from potential offerors only such information as appropriate for an objective evaluation of all potential offerors pursuant to such criteria.

  4. FCPS shall issue the RFP after the receipt and evaluation of the RFQ under the Procedures below. The RFP shall include and define the criteria of the construction project in areas such as site plans; floor plans; exterior elevations; basic building envelope materials; fire protection information plans; structural, mechanical (HVAC), and electrical systems; and special telecommunications; and may define such other requirements as FCPS determines appropriate for that particular project.

  5. A Virginia licensed architect or engineer in FCPS's employ or under contract with FCPS shall assist with preparation of both the RFQ and the RFP.

  6. FCPS will award any Alternate Contract Structure contract in accordance with Sections III or IV of these Procedures. Notwithstanding the foregoing, nothing in these Procedures shall require the award of any contract in response to a particular RFQ or RFP, or prohibit the discontinuance of any procurement process before award for any reason or for no reason, in the discretion of the Board or its designee. Nothing in these Procedures shall prevent the restart, from the beginning, of any terminated procurement process under these Procedures or under the PPEA or any other procurement procedure permitted under Virginia law.

  7. The RFP shall have a limited number of stated evaluation criteria that FCPS will use to evaluate offerors and proposals. The evaluation criteria shall include price to the extent required or permitted under applicable law, and as described in Sections III and IV of these Procedures. Price need not be the sole determining factor except to the extent required by these procedures. The RFP should list the evaluation criteria in their order of importance. FCPS may, but is not required to assign numerical weights to the evaluation criteria unless otherwise required under these Procedures.

  8. Offerors may clearly designate portions of their submissions as trade secrets or proprietary information pursuant to Virginia Code § 2.2-4342(F). FCPS will take reasonable measures to safeguard from unauthorized disclosure such information properly designated as such, to the extent permitted by law.

  9. Prospective offerors or offerors in a proceeding to procure an Alternate Contract Structure may submit comments regarding RFQs, RFPs and specifications in writing to the Supervisor of Construction, who will consider them.

  10. In any procurement under these Procedures, should the Superintendent determine in writing and at his sole discretion that only one offeror is fully qualified, or that one offeror is clearly more highly qualified than the others under consideration, then FCPS may negotiate a contract and, subject to Board approval, award the contract to that offeror.

  11. When the Evaluation Committee does not include an offeror on the short list that the Evaluation Committee creates at the end of the RFQ process, the Evaluation Committee shall promptly communicate that fact to such offeror and the reasons why the Evaluation Committee did not include the offeror on such short list. In the event that the Evaluation Committee denies an offeror prequalification outright (as opposed to merely leaving the offeror off the short list of between two and five offerors that the Evaluation Committee prepares at the conclusion of the RFQ process), then the Evaluation Committee shall promptly communicate to such offeror its factual and legal basis for doing so, which must be a basis enumerated in Virginia Code § 2.2-4317(C).

  12. In any procurement under these Procedures, FCPS may award a contract to more than one offeror if the RFP so provides.
Section III: Special Criteria and Procedures for Design-Build Contracts
  1. Design-Build contracts are best suited to project types that have two or more of the following characteristics: (1) relatively simple and straight forward, (2) incorporate integral engineering/engineered shop drawing components as primary systems, or (3) are new construction.

  2. Prior to initiating the procurement for a Design-Build contract, the Supervisor of Construction shall request authority, in writing, through the Superintendent, to the Board, to use a Design-Build contract. If the Superintendent believes the request to be meritorious, he shall seek review from counsel to FCPS and, upon confirmation of the request’s merit, shall forward it to the Board with his recommendation for approval. The request shall include the written documentation required in Section I, paragraph C(2) above. The request shall justify and substantiate that Design-Build is more advantageous than a competitive sealed bid construction contract with a general contractor and shall indicate how FCPS will benefit from using Design-Build, as well as a discussion of how the proposed project is appropriate for a Design-Build process under paragraph (A) above. Reasons for such a determination may include construction cost savings, project complexity, building use, project timeline, or the need for a single point of contact. The request shall also state whether the Supervisor of Construction proposes that the award issue based on the lowest cost offeror who has submitted an acceptable Technical Proposal, or if the award should issue based upon a combination of cost as a critical factor and the technical merits of the proposal based on criteria to be provided in the RFP as additional factors under a method consistent with the method described in the Manual.

  3. Prior to initiating the procurement, the Supervisor of Construction shall also prepare “Bridging Documents” consistent with the types of “Bridging Documents” required by § 7.30.1 of the Manual.

  4. If the Board approves the request, procurement of the contract shall be by a two-step competitive negotiation process. The Supervisor of Construction shall appoint an Evaluation Committee, which shall include a licensed professional engineer and architect employed by or under contract to FCPS. The Evaluation Committee shall have at least three voting members. If the licensed professional engineer or architect on the Committee is an employee of FCPS, he or she shall be a voting member; if not, the Supervisor of Construction may designate him or her as a voting or non-voting member in the Supervisor of Construction’s discretion.

  5. Under the first step of the process, FCPS shall publish an RFQ to provide notice of its invitation for Design-Builders to submit qualifications. The Evaluation Committee shall develop a list of qualification criteria for inclusion in the RFQ, including any unique capabilities and qualifications required of the Construction Manager. FCPS shall post the RFQ in accordance with the current standards in the Code of Virginia on the FCPS website and on eVA, Virginia’s central electronic procurement website, for a minimum of 30 days. The Evaluation Committee may also publicize the RFQ using any other available methods. The Evaluation Committee shall evaluate each responding firm’s submittals and any other relevant information in light of the qualifications requested in the RFQ, and shall create a short list of no less than two and no more than five offerors deemed most qualified for the project.

  6. Under the second step of the process, the Evaluation Committee will issue an RFP and may recommend a Design-Build contractor to the Board for award.

    1. FCPS shall prepare an RFP containing the Board’s requirements, building and site criteria, site and survey data, the criteria to be used to evaluate submittals, and other relevant information. The RFP must indicate either that if an award is made (i) it will be to the offeror who submits an acceptable technical proposal at the lowest cost, or (i) to the offeror whose proposal is determined to be the best value due to receiving the highest score from the Evaluation Committee, depending on which method the Board authorized when it authorized the procurement.

    2. FCPS will invite offerors that the Evaluation Committee selected under paragraph (E) above to submit Technical and Cost Proposals in response to the RFP. No other persons may respond to the RFP. Offerors will have at least thirty (30) days after issuance of the RFP and invitation within which to submit their proposals by a firm deadline that appears in the RFP. Such offerors should submit sealed Technical Proposals and separately sealed Cost Proposals to a designated FCPS fiscal officer. The fiscal officer will secure the cost proposals and keep them sealed and will forward the Technical Proposals to the Evaluation Committee. FCPS will not consider proposals that mix Technical and Cost Proposals in one package, and such proposals shall be disqualified from further participation in the procurement process.

    3. The Evaluation Committee will evaluate the Technical Proposals based upon the evaluation criteria contained in the RFP. As a part of the evaluation process, the Evaluation Committee should grant each of the offerors invited to submit a proposal an equal opportunity for direct and private communication and negotiation with the Evaluation Committee. Each offeror should be allotted approximately the same fixed amount of time. In its conversations with offerors, the Evaluation Committee should exercise care to discuss the same owner information with all offerors. In addition, the Evaluation Committee shall not disclose to any other offeror or the public any trade secret or proprietary information for which an offeror has invoked protection pursuant to Virginia Code § 2.2-4342(F), and which is in fact protected under applicable law. The Committee should inform each Design-Build offeror of any adjustment necessary to make its Technical Proposal fully comply with the requirements of the RFP, and in such communication shall provide a firm deadline for the offer to submit such adjustments.

    4. Based upon its review of each offeror’s Technical Proposal, the Evaluation Committee should determine whether any changes to the RFP should be made to clarify errors, omissions or ambiguities in the RFP or to incorporate project improvements or additional details, or both, identified by the Evaluation Committee during its review. If such changes are required, the Evaluation Committee shall provide an addendum to each offeror, and offerors invited to submit proposals shall have an opportunity to revise their proposals in response to the amendment by a firm deadline included in the communication of the amendment.

    5. Based upon the revisions made to its Technical Proposal, an offeror may make additive and deductive amendments to its Cost Proposal. In addition, an offeror may submit cost modifications from its original sealed Cost Proposal that are not based upon revisions to the Technical Proposal. Such amendments and revisions shall be submitted in a separate sealed revised Cost Proposal, which will be secured by a designated FCPS fiscal officer and not reviewed by the Evaluation Committee until after evaluation of Technical Proposals.

    6. At the conclusion of the evaluation process, the Evaluation Committee shall determine whether any of the final, revised Technical Proposals are not acceptable to FCPS at any cost because of their non-compliance or non-responsiveness to one or more evaluation or project criteria contained in the RFP, or other requirements of the RFP, and shall remove such proposals from further consideration. Ordinarily, before taking such a step, the Evaluation Committee will have communicated such deficiencies to the offeror under paragraph (3) and provided such offeror an opportunity to correct such deficiencies. The Evaluation Committee shall communicate its action in doing so to any such offeror, together with its reasons for doing so. In addition, if the Board has approved award based upon a best value basis rather than to the offeror who submits an acceptable Technical Proposal at the lowest cost, then the Evaluation Committee shall employ Method #2 in Section 7.30.1 of the Manual, steps a and b, to rank Technical Proposals.

    7. At the conclusion of design development and evaluation of Technical Proposals, the Evaluation Committee shall publicly open, read aloud, and tabulate the Cost Proposals. It shall add to or subtract from the Cost Proposal any cost adjustments contained in amendments submitted by a Design-Build offeror. If the Board has approved Method #2 for selection, the Evaluation Committee shall score Cost Proposals in accordance with the Manual, Section 7.30.1, Method #2.

    8. The Evaluation Committee shall then make its recommendation on the selection of a Design-Builder to the Superintendent and the Board based upon its evaluation. The Evaluation Committee shall recommend the offeror who submits an acceptable Technical Proposal at the lowest cost, or the offeror who submits the Technical Proposal with the highest score as described above, in accordance with the selection method the Board approved at the beginning of the process.

  7. The Superintendent shall notify the Board of the recommendation of the Evaluation Committee and shall request authority to award a contract by submission of an appropriate proposed contract and supporting documents for the Board’s approval. The form of the contract shall be approved by Counsel to the Board.

  8. Upon receipt of the Board’s approval to award the contract, the Superintendent or his or her designee will notify all offerors who submitted proposals which offeror was selected as Design-Builder for the project. In the alternative, the Superintendent may notify all offerors who submitted proposals of the Evaluation Committee’s recommendation that the Board award the contract to a particular offeror at any time after the Evaluation Committee has recommended a Design-Builder, without waiting for the Board’s approval.
Section IV: Special Criteria and Procedures for Construction Management at Risk Contracts
  1. Construction Management At Risk Contracts (“CMRCs”) are permissible for projects with an estimated construction cost in excess of $10,000,000 where one or more of the following factors suggest that a CMRC would be advantageous to FCPS: Construction Cost, Project Complexity, Building Use, Project Timeline, Project Phasing, Necessity of Value Engineering or Constructability Analysis Concurrent with Design, Quality Control or Vendor Prequalification Needs, or Cost/Design Control Needs. With express Board approval, CMRCs are permissible for projects under $10,000,000 when one or more of the foregoing factors suggests that it is appropriate, and when a project constitutes a “complex project” as defined in state law.

  2. Prior to initiating the procurement, the Supervisor of Construction shall request authority from the Board, in writing, through the Superintendent, to use a CMRC. The request shall include the written determinations required under Section I, paragraph C(2) above. The request shall justify and substantiate that the CMRC meets one or more of the criteria found in paragraph (A) above. If the Superintendent believes the request to be meritorious, he shall seek review from counsel to FCPS and, upon confirmation of the request’s merit, shall forward it to the Board with his recommendation for approval.

  3. On projects approved for a CMRC, FCPS shall proceed with a two-step competitive negotiation process to select a Construction Manager. The Supervisor of Construction shall appoint an Evaluation Committee, which includes a Virginia licensed professional engineer or architect who is employed by or under contract to FCPS. The Evaluation Committee shall have at least three voting members. If the licensed professional engineer or architect on the committee is a FCPS employee, he or she shall be a voting member; if not, he or she may be designated as a voting or non-voting member in the Supervisor of Construction’s discretion.

  4. Under the first step of the process, FCPS shall publish an RFQ to provide notice of its invitation for potential Construction Managers to submit qualifications. The Evaluation Committee shall develop a list of qualification criteria for inclusion in the RFQ, including any unique capabilities and qualifications required of the Construction Manager. The Evaluation Committee may consider the prior experience of a potential Construction Manager on comparable projects, but may not require prior experience with an Alternative Contract Structure as a prerequisite for qualification or for award of the contract. FCPS shall publish the RFQ on its website and on eVA, Virginia’s central electronic procurement website, at least thirty (30) days in advance of when prequalification submittals are due. The Evaluation Committee may also publicize the RFQ using any other available methods. The Evaluation Committee shall establish a firm deadline for submittals. The Evaluation Committee shall evaluate each responding firm’s submittals and any other relevant information in light of the qualifications requested in the RFQ, and shall create a short list of no less than two and no more than five offerors deemed most qualified for the project.

  5. Under the second step of the process, the Evaluation Committee will issue an RFP and may recommend a Construction Manager to the Board for a contract award.

    1. The Evaluation Committee will send an RFP to the firms on the short list described above and request submission of formal proposals from them. The Evaluation Committee will not entertain any other formal proposals. The Evaluation Committee shall set a due date for the formal proposals, which must not be less than thirty (30) days after the Evaluation Committee transmits the RFP to such firms.

    2. All RFPs shall request the offeror to provide:

      1. A lump sum fee for pre-construction Services in accordance with the scope of services included in the RFP;

      2. A General Conditions Fee based upon an anticipated duration set by the FCPS detailed in a specific listing of General Conditions items and their associated cost;

      3. An Insurance and Taxes Fee expressed as a rate (percentage) to include all insurance costs such as general liability insurance, builder’s risk insurance, payment and performance bonds, and any other insurance costs that are required by the contract and any taxes such as local business licenses or other taxes that are required for the completion of the work expressed as a percentage. The Insurance and Taxes Fee is to be inclusive of all items, other than design or CM contingencies, CM Fee, or General Conditions Fee, that will be included in addition to the cost of the work in establishing the guaranteed maximum price and the final contract value; and

      4. A CM/GC Fee to include all home office expenses, overhead and profit during the construction phase of the contract.

      Notwithstanding the foregoing, the RFP shall not request budget estimates for the total project budget.

    3. The Evaluation Committee will evaluate and rank the proposals and conduct negotiations with two or more offerors submitting the best proposals. The CM Fee and the Preconstruction Services Fee shall be evaluated based upon the sum of those fees and not individually. As a part of the evaluation process, the Evaluation Committee should grant each of the offerors selected for negotiations an equal opportunity for direct and private communication with the Evaluation Committee. Each offeror selected for negotiations should be allotted approximately the same fixed amount of time. In its conversations with offerors, the Evaluation Committee should exercise care to discuss the same owner information with all offerors. In addition, the Evaluation Committee shall not disclose to other offerors or the public any trade secret or proprietary information for which an offeror has invoked protection pursuant to Virginia Code
      § 2.2-4342(F), and which is in fact protected under applicable law.

    4. Based upon its review of each offeror’s proposal, the Evaluation Committee shall determine whether any changes to the RFP should be made to clarify errors, omissions, or ambiguities in the RFP or to incorporate project improvements or additional details, or both, identified by the Evaluation Committee during its review. If such changes are required, the Evaluation Committee shall provide an addendum to each offeror. Offerors shall then have an opportunity to revise their proposals in response to the amendment by a firm deadline included in the communication of the proposed amendment. Such revisions may include the revision of any cost information described above if, and only if, such revisions directly and demonstrably relate to the Evaluation Committee’s alterations to the RFP.

    5. The Evaluation Committee shall make its recommendation on the selection of a Construction Manager to the Superintendent and the Board based upon its evaluation. The Evaluation Committee shall recommend the offeror whom it deems fully qualified, who has provided a proposal that conforms to and responds to the evaluation and project criteria contained in the RFP, and whom it determines to have provided the best value in response to the RFP. Price shall be a critical basis for the award of the contract.

  6. The Superintendent shall notify the Board of the recommendation of the Evaluation Committee and shall request authority to award a contract by submission of an appropriate proposed contract and supporting documents for the Board’s approval. The form of the contract shall be approved by Counsel to the Board. FCPS must enter into the CMRC no later than the completion of the schematic phase of design, unless prohibited by authorization of funding restrictions.

  7. Upon receipt of the Board’s approval to award the contract, the Superintendent or his or her designee will notify all offerors who submitted proposals which offeror was selected as Construction Manager for the project. In the alternative, the Superintendent may notify all offerors who submitted proposals of the Evaluation Committee’s recommendation that the Board to award the contract to a particular offeror at any time after the Evaluation Committee has selected a Construction Manager, without waiting for the Board’s approval.

  8. The CMRC shall have the following terms and structure:

    1. The Construction Manager may perform no more than ten percent (10%) of the construction work, measured by contract cost, with its own forces; subcontractors must perform the remaining ninety percent (90%) of such construction work.

    2. To the maximum extent practicable, the Construction Manager must procure all such subcontractors though publically advertised, competitive sealed bidding.

    3. The CMRCs are structured into two phases: Phase 1, for pre-construction phase services, will be performed for a stipulated or fixed amount as described above. The Phase 1 contract is associated with the work of the Construction Manager prior to the start of construction activities. Phase 2, for construction phase service, is contingent upon the Construction Manager providing an agreeable guaranteed maximum price (“GMP”) to FCPS. The GMP is established at the completion of working drawings. The Phase 2 contract is associated with the work of the Construction Manager and its subcontractors during the construction portion of the project.

  9. In the event that the Construction Manager and FCPS cannot agree upon a GMP at the conclusion of Phase 1 of the CMRC, then FCPS would not enter into a Phase 2 contract with the Construction Manager. At this point in the process, the design documents are substantially complete and FCPS may bid the project using standard competitive sealed bidding to the offerors on the Evaluation Committee’s original short list (and including the Construction Manager with whom a FCPS could not agree upon a GMP). If FCPS so bids the project using standard competitive sealed bid procedures, the construction contingency of the CMRC process would no longer be applicable, because allowances and contingencies are not permitted using the standard Design-Bid-Build process. The bidders would submit a firm, sealed bid under procedures analogous to normal, competitive-sealed-bid VPPA procedures, without contingencies. Alternatively, if factors remain that suggest a benefit to FCPS from continuing the CMRC process, the Superintendent may request a GMP from the other offerors on the Evaluation Committee’s original short list. Under such circumstances, FCPS will no longer negotiate with the original successful Construction Manager. Rather, FCPS will consider a proposed GMP from the second highest ranked offeror from the Evaluation Committee’s list. If FCPS cannot negotiate an acceptable GMP with that proposer, then it may consider a GMP from the third ranked proposer, and so on. Each unsuccessful negotiation from the successive proposers removes that proposer from further consideration.

  10. In the event that FCPS considers it advisable to prepare early release packages to subcontractors, and with the Supervisor of Construction’s consent, such packages may include a preliminary, interim GMP. Such early release packages shall be established based upon approved working drawings for the work of that package and the value of the early release shall serve as an interim GMP for the work pending the full GMP for the project.
Section V: Additional Procedures for Protests of an Alternate Contract Structure
  1. Protests based upon the Board’s decision to use an Alternate Contract Structure shall be made as soon as possible after the decision is made public but not in any event later than five (5) days after publication of the notice of the RFQ for Design-Builders or Construction Managers. Otherwise, any protest of the Board’s decision to use an Alternate Contract Structure shall be deemed waived.

  2. Protests based upon the contents of an RFQ or RFP must be made at least five (5) days prior to when proposals are due in response to the RFQ or RFP. Otherwise, any protest based upon the contents of the RFQ or RFP shall be deemed waived.

  3. A submitter’s response to an RFQ for a project using an Alternative Contract Structure shall constitute a waiver by the submitter of any protest based upon (i) a decision to use the Alternate Contract Structure for the project, and (ii) the terms and conditions of the RFQ. Submission of a proposal in response to an RFP shall constitute a waiver by the submitter of any protest based upon the terms and conditions in the RFP.

  4. Any protest of the Evaluation Committee’s decision (i) to deny prequalification to an offeror at the RFQ stage, or (ii) to leave an offeror off the short list at the end of the RFQ stage, must be made no later than five (5) days after the offeror’s receipt of the notice described in Section II, Paragraph (K). Any such protest must be based upon a violation of applicable law or regulation, and may not be based upon a mere disagreement with the Evaluation Committee’s evaluation of the offeror’s qualifications.

Legal Reference(s):
Code of Virginia Section(s) 2.2 – 4300, et seq


Cross Reference(s):
Policy 703P, Operations and Finance- Guidelines Regarding Requests Made Pursuant to Public-Private Education Facilities and Infrastructure Act of 2002


Adopted: September 18, 2018