How Full is Your CUPCCAA?

Transcription

1 CASBO 2017 Annual Conference April 2017 How Full is Your CUPCCAA? Gioconda Padilla Glendale Unified School District Phil Henderson Orbach Huff Suarez & Henderson

2 California School District Procurement Generally Bid Limits. California school districts must formally and publicly bid contracts for construction projects over $15,000, unless there is an exception. (Public Contract Code ( PCC ) 20111) CUPCCAA Exception. Exception to this general rule for school districts and other local agencies that elect to be subject to the California Uniform Public Construction Cost Accounting Act ( CUPCCAA ). (PCC )

3 What is CUPCCAA? Allows local agencies to perform public projects up to certain amounts with their own workforces ( Force Account ) or by negotiated contract. Provides for alternative ( informal ) bidding procedures when an agency performs public projects up to certain amounts. The agency must follow specific accounting procedures.

4 Bid Limits Under the Act Public projects of $45,000 or less may be performed by negotiated contract or with the District s own workforces ( Force Account ). Public projects of $175,000 or less may be let to contract by the informal procedures set forth in the Act. Public projects of more than $175,000 shall be let to contract by formal bidding procedures, including: Detailed architectural plans, voluminous bid and contract documents, Newspaper advertising for 14 days before bid opening; Notice in trade journals 15 days before bid opening; Other more detailed steps and processes. (PCC (a) - (c); PCC )

5 Implementation of CUPCCAA Governing Board approves resolution to become subject to CUPCCAA procedures. District files resolution with Controller. Entire District becomes subject to the Act. Board enacts informal bidding regulations under PCC establishing list of contractors to be notified of potential projects and procedures for informal bidding.

6 Establishing and Maintaining List of Qualified Contractors Each November, District mails written notice to designated trade journals, inviting all licensed contractors to submit firm names and required information for inclusion on qualified bidders list for following calendar year. District can elect to start the program prior to November and must then re-invite contractors in November. District creates updated contractors list next January 1. May include any contractors names it desires. Must include contractors providing required information during calendar year or prior November or December. Contractor may have firm added to list by providing required information at any time. Commission recommends inclusion of all contractors who submitted one or more valid bids during preceding year.

7 Procedures for Informal Bidding Procedures for informal bidding: District maintains list of qualified contractors, identified by work category; District mails notice inviting bids at least 10 days before bids due to: All contractors on list for category of work; or Specified trade journals; or Both. Notice should describe project in general terms with information for how to obtain detailed information and time and place for submission of bids. Will often include site walk, where appropriate.

8 Procedures for Informal Bidding, Cont d. Notice need not include drawings, plans, etc., unless required for preparing bid. Governing Board may delegate authority to award informal contracts to specific staff members (e.g., to Superintendent). If all bids received exceed $175,000, Governing Board may pass four-fifths resolution awarding contract at $187,500 or less to lowest responsible bidder if it determines District s cost estimate was reasonable.

9 Procedures for Formal Bidding Public projects of more than $175,000 shall be let to contract by formal bidding procedures, including: Detailed architectural plans, standard bid and contract documents, Newspaper advertising for 14 days before bid opening; Notice in trade journals 15 days before bid opening; Other more detailed steps and processes.

10 CUPCCAA Contracts Are Still Public Works Contracts Contractor Must Pay Prevailing Wages. (Ed. Code 17424) Bid Bond / Bid Security Required CUPCCAA does not waive the statutory requirement for a bid bond. (PCC 20111(b).) Payment Bond Required Civil Code 3247: Every original contractor to whom is awarded a contract by a public entity... in excess... of $25,000 for any public work shall file a payment bond. Get a performance bond too. Fingerprinting. (Ed. Code 45125, et seq.) Field Act Compliance Required. Construction is subject to all State approvals, as set forth in Education Code sections through (Ed. Code )

11 What is Force Account? Work performed on public projects using internal resources, including labor, equipment, materials, supplies, and subcontracts. Project costs for force account work include the following: Direct Costs: Labor (employee) including all benefit costs Equipment charged on an hourly rate including depreciation, insurance, maint./repair, fuel and oil, tires and grease, etc. Cost of materials and supplies with a total unit value of $25 or more including discounts, tax, and shipping. Plus, [see next slide:]

12 What is Force Account?, cont d. Indirect Costs: Other labor including inspection, clerical, and supervision. Other expenses including utilities, telephone, temp. fencing, etc. Overhead Costs: Either the agency s actual overhead rate or 30% of direct costs The Commission has determined that compliance with the Standard Accounting Code Structure meets the requirements of the Act.

13 What is Force Account?, cont d. The tracking of projects completed by Force Account is not daunting. SACS allows districts to account by fund, resource, program, and object code. Project tracking can be done within the financial system: Labor: Fund Sub-Fd Resource Goal Function Object Loc. Prog. Resp. Proj. Yr XXXX XXX Equipment: Fund Sub-Fd Resource Goal Function Object Loc. Prog. Resp. Proj. Yr XXXX XXX Materials & Supplies: Fund Sub-Fd Resource Goal Function Object Loc. Prog. Resp. Proj. Yr XXXX XXX

14 What is Force Account?, cont d. A District may reject all bids presented on a project. The District then can reevaluate its cost estimates for the project and either: Abandon the project or readvertise for bids again, or Pass a four-fifths resolution declaring the project can be performed by Force Account. This provision is a rarely-used option for school districts, but may be a useful tool. Discuss with your legal counsel in more detail the implications and ramifications if the District ever opts to utilize this process. No Bids Received. If no bids are received through the formal or informal process, a District may perform the project by Force Account or negotiated contract without further complying with CUPCCAA procedures. (PCC )

15 Emergency Contracts The work may be done by day labor under the direction of the governing board, by contractor, or by a combination of the two. By a four-fifths vote of the governing board, may repair or replace a public facility, take any directly related and immediate action required by that emergency, and procure the necessary equipment, services, and supplies for those purposes, without giving notice for bids to let contracts. By a four-fifths vote of the governing board, the authority to enter emergency contracts may be delegated. The designee must report at each following meeting until the action is terminated (contract completed).

16 The Entire District Would be Subject to CUPCCAA A public agency which has elected to become subject to [CUPCCAA], may utilize the bidding procedures set forth in [CUPCCAA] when contracting for "maintenance work," as defined in Section 22002, or when contracting for any other work which does not fall within the definition of "public project," as defined in Section [like repairs]. (PCC 22003, emphasis added.)

17 The Entire District Would be Subject to CUPCCAA So, for maintenance and/or repairs, the District may choose to informally bid for maintenance within the "donut hole" from $45,001 to $88,300 (the current bid limit for repairs and maintenance). Most Districts include maintenance (and repairs) in its CUPCCAA resolution. If the District excludes repairs and maintenance, the bid limit for formal contracts for repairs and maintenance would remain at $88,300 for school districts rather than $175,000. (PCC )

18 What is a Public Project? Public Project per PCC 22002(c) These are not Repairs or Maintenance (1) Construction, reconstruction, erection, alteration, renovation, improvement, demolition, and repair work involving any publicly owned, leased, or operated facility. (2) Painting or repainting of any publicly owned, leased, or operated facility. (Emphasis added. Note inclusion of repair )

19 What is Maintenance? Maintenance (per PCC 22002(d)) (1) Routine, recurring, and usual work for the preservation or protection of any publicly owned or publicly operated facility for its intended purposes. (2) Minor repainting. (3) Resurfacing of streets and highways at less than one inch. (4) Landscape maintenance, including mowing, watering, trimming, pruning, planting, replacement of plants, and servicing of irrigation and sprinkler systems.

20 What is a Repair? Cases Interpreting What is a Repair The word repair in its ordinary sense relates to the preservation of property in its original condition, and does not carry the connotation that a new thing should be made or a distinct entity created. (2) Minor repainting. (Whalen v. Ruiz (1953) 40 Cal.2d 294, , 253 P.2d 457.) To repair means to mend an old thing, not to make a new thing; to restore to a sound state something which has become partially dilapidated, not to create something which has no existence. ( Id., 40 Cal.2d at p. 300, 253 P.2d 457.)

21 Factors to Consider What could be recurring projects that preserve or protect school facilities in the District is a factual determination. Some factors to Consider: The facility needs to be currently in existence. The work needs to be routine, recurring, and usual. The need for the work must be based on keeping the facility in functioning and useful order or to preserve it for future use.

22 PUBLIC PROJECT Painting an entire school Replacing multiple HVAC units at a site Replacing all fencing at a site Replacing all plumbing fixtures in the bathrooms at a site Building a snack shack at a field Installing bleachers at a field Re-paving a parking lot if depth is greater than 1 inch Replacing multiple windows at a site Installing new grass at a field Replacing a portion of a sprinkler system at a site < GREY > < AREA > Any variations between the examples within these two categories must be evaluated on a case-by-case basis. < GREY > < AREA > MAINTENANCE WORK Painting over graffiti; repainting a portion of a damaged school Replacing one failing HVAC unit at a site Replacing a portion of a site s aged cyclone fence Replacing rusted components of plumbing fixtures in one bathroom Patching the roof of a snack shack at one field Re-finishing portions of wooden seats on some bleachers at one field. Re-paving a parking lot if depth is less than 1 inch Fixing a few single cracked windows at a site Mowing, trimming, planting replacement bushes Inspecting/fixing a few parts of a sprinkler system at a site

23 Purchase of Materials Under CUPCCAA Can Informal Bidding Procedures Be Used For Purchase of Materials? Only if materials are consumed on a public contract subject to and defined by the policies and procedures manual.

24 CASBO 2017 Annual Conference April 2017 How Full is Your CUPCCAA? Gioconda Padilla Glendale Unified School District Phil Henderson Orbach Huff Suarez & Henderson