In accordance with the provisions of § 2.2-4306 of the Code of Virginia, I hereby adopt the following procedures for the procurement of Design-Build (“D/B”) contracts, as defined in § 2.2-4301, which shall be followed by all departments, agencies, and institutions of the Commonwealth (each of which is hereinafter referred to as an "Agency"). These procedures shall be effective March 1, 2012.
A. LEGISLATIVE AUTHORITY: Under authority of § 2.2-4306 of the Code of Virginia, the Commonwealth may contract to secure D/B projects on a fixed price basis in accordance with these procedures and the regulations adopted pursuant to § 2.2-1502 of the Code of Virginia. Under the authority of § 2.2-4303 (D)(1) of the Code of Virginia, an Agency is authorized to use competitive negotiations to procure D/B contracts when it determines in advance, and sets forth in writing, that competitive sealed bidding is either not practicable or not fiscally advantageous to the public, which writing shall document the basis for this determination.
B. CRITERIA FOR USE OF D/B CONTRACTS: D/B contracts are intended to minimize the project risk for an owner and to reduce the delivery schedule by overlapping the design phase and construction phase of a project.
C. PROCEDURE FOR APPROVAL TO USE D/B: Prior to taking any action, the Agency shall request authority, in writing and receive approval from the Director of the Division of Engineering and Buildings (“Director”), to use a D/B contract.
The request shall justify and substantiate that D/B is more advantageous than a competitive sealed bid construction contract with a general contractor and shall indicate how the Commonwealth will benefit from using D/B. The request shall also include a written justification that competitive sealed bidding is not practical and/or fiscally advantageous.
Approval of exceptions to this policy may be granted by the Director, who is the approving authority for requests to use D/B procedures.
D. D/B SELECTION PROCEDURES: On projects approved for D/B, procurement of the contract shall be a two step competitive negotiation process. The following procedures shall be used in selecting a Design-Builder and awarding a contract:
1. The Agency shall appoint an Evaluation Committee (“Committee”) which shall consist of at least three members from the Agency, including a registered design professional, if possible. The Committee shall include a registered design professional provided by the Division of Engineering and Buildings. The Agency shall contact the Section in the Office of the Attorney General representing the Division of Engineering and Buildings (currently the Real Estate and Land Use Section) to determine whether a representative from the OAG should be involved.
2. The basis of the award of the contract shall be in accordance with § 2.2-4301(3)(b) and the criteria for the award shall be submitted to the Director, in advance, for approval. Cost shall be a critical component of the selection criteria.
3. Selection of Qualified Offerors (STEP I):
On projects approved for D/B, the Agency shall conduct a prequalification process as follows to determine which offerors are qualified to submit proposals.
a) The Agency shall prepare a Request for Qualifications (“RFQ”) containing the Agency's Facility Requirements, building and site criteria, site and survey data (if available), the criteria to be used to evaluate submittals and other relevant information, including any unique capabilities or qualifications that will be required of the contractor.
b) The RFQ shall be posted in accordance with the current standards for the posting of public bids in the Code of Virginia and in accordance with the latest edition of the Construction and Professional Services Manual.
c) The Committee shall evaluate each responding firm's submittals and any other relevant information and shall determine those deemed qualified with respect to the criteria established for the project.
d) An offeror may be denied prequalification only as specified under § 2.2-4317 of the Code of Virginia.
e) At least 30 days prior to the date established for the submission of proposals, the Agency shall advise in writing each offeror which sought prequalification whether that offeror has been prequalified. In the event that an offeror is denied prequalification, the written notification to such offeror shall state the reasons for such denial of prequalification and the factual basis of such reasons.
4. Selection of Design-Build Contractor (STEP II):
a) The Agency will send a Request for Proposal ("RFP") to at least two*, and up to five, of the D/B offerors deemed most suitable for the project, from those selected by the Committee. Sealed Technical Proposals as described in the RFP will be submitted to the Committee. Separately-sealed Cost Proposals will be submitted to the Agency’s Virginia Construction Contracting Officer (“VCCO”), and shall be secured by and kept sealed until evaluation of the Technical Proposals and the design development negotiations are completed.
* Should the Agency determine, in writing and in its sole discretion, that only one offeror is fully qualified or that one offeror is clearly more highly qualified than the others under consideration, a contract may be negotiated with that offeror after approval of the Director.
b) The Committee will evaluate the Technical Proposals based on the criteria contained in the RFP. It will inform each D/B offeror of any adjustments necessary to make its Technical Proposal fully comply with the requirements of the RFP. In addition, the Agency may require that offerors make design adjustments necessary to incorporate project improvements and/or additional detailed information identified by the Committee during design development.
c) Based on the revisions made to the Technical Proposals, the Committee and an offeror may negotiate additive and deductive amendments to the offeror's Cost Proposals. In addition, an offeror may submit cost deductions from its original sealed Cost Proposal which are not based upon revisions to the Technical Proposals. When the terms and conditions for multiple awards are so provided in the RFP, awards may be made to more than one offeror.
d) The Committee shall make its recommendation on the selection of a Design-Builder to the Agency head based on its evaluations and negotiations. The contract shall be awarded to the offeror who is fully qualified, has submitted an acceptable proposal and has been determined provide the best value in response to the Request for Proposal.
e) The Agency shall notify the Division of Engineering and Buildings of its selection of the Design-Builder and shall request authority to award a contract by submission of form DGS-30-058, CO-8, Approval to Award Construction Contract and supporting documents, to the Bureau of Capital Outlay Management via e-mail to coforms@dgs.virginia.gov.
f) Award of the D/B contract shall be made to the offeror selected.
g) The Agency will notify all offerors who submitted proposals which offeror was selected for the project.
E. Any institution of higher education with authority for capital projects pursuant to the Restructured Higher Education Financial and Administrative Operations Act, may utilize these procedures or such other procedures as they may have adopted pursuant to any signed memorandum of agreement.
F. The Code of Virginia requires other public bodies planning to use D/B to adopt guidelines consistent with the above procedures. A key difference is that steps requiring the approval or involvement of the Director of the Division of Engineering and Buildings will instead seek the approval or involvement of the appropriate authority, as directed by the governing body of the public body. Before implementing D/B, such public body must have the required professional staff and meet the material requirements of § 2.2-4308 of the Code of Virginia. It should also be noted that certain procedures incorporated above are mandated by Code for state agencies. Other public bodies may not be required to adopt identical standards, but their procedures are required to be consistent with these.
