Bill Text For HB1661 - Engrossed

 1|ENGROSSED HOUSE                                                        |
  |BILL NO. 1661                        By: West (Kevin) of the House     |
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  |                                         Leewright of the Senate       |
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 7|       An Act relating to public buildings and public works;           |
  |       amending Section 10, Chapter 299, O.S.L. 2020 (61               |
 8|       O.S. Supp. 2020, Section 217), which relates to the             |
  |       Public Construction Management Act for Political                |
 9|       Subdivisions; modifying procedures for awarding work;           |
  |       removing certain option; and providing an effective             |
10|       date.                                                           |
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13|BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:                  |
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14|    SECTION 1.     AMENDATORY     Section 10, Chapter 299, O.S.L.      |
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15|2020 (61 O.S. Supp. 2020, Section 217), is amended to read as          |
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16|follows:                                                               |
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17|    Section 217.  A.  Construction managers shall be selected by the   |
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18|political subdivision following the requirements set forth in          |
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19|subsection K of Section 62 of Title 61 of the Oklahoma Statutes.       |
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20|    B.  A written contract between the political subdivision and the   |
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21|construction manager shall set forth the obligations of the parties,   |
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22|which, at a minimum, shall include the construction manager's scope    |
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23|of services, fees and expenses, as follows:                            |
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arsid6828605 ENGR. H. B. NO. 1661                                  Page 1
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 1|    1.  A construction management fee, which may be based on a         |
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 2|percentage of the construction cost or as defined in the contract;     |
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 3|    2.  The cost or basis of cost expenses incurred by the             |
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 4|construction manager to be reimbursed by the subdivision for normal    |
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 5|general conditions and general requirements necessary for the work     |
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 6|but not applicable to a particular subcontractor, trade contractor     |
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 7|or supplier; and                                                       |
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 8|    3.  Other project-related expenses as set forth in the contract.   |
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 9|    C.  The procedures for awarding work under agency construction     |
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10|management are as follows:                                             |
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11|    1.  The construction manager, with the advice of the design        |
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12|consultant and subdivision, will develop individual bid packages for   |
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13|public bidding;                                                        |
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14|    2.  Public bidding on individual bid packages will comply with     |
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15|the requirements of the Public Competitive Bidding Act of 1974 and     |
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16|may include scope of work of the bidder;                               |
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17|    3.  The construction manager shall evaluate all bids and           |
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18|recommend the lowest responsible bidder to the subdivision, who        |
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19|shall accept or reject the bids.  The construction manager may         |
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20|assist the subdivision with the preparation of contracts and the       |
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21|receipt of insurance and bonds as required for public construction     |
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22|contracts by state law;                                                |
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23|    4.  After trade contracts are awarded, the construction manager    |
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24|will perform contract administrative services as set forth in the      |
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arsid6828605 ENGR. H. B. NO. 1661                                  Page 2
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 1|agreement and may assist the subdivision with the review and           |
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 2|processing of progress and final payments to the subcontractors.       |
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 3|However, under no circumstances shall construction managers receive    |
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 4|funds from subdivisions for payments of trade contractors;             |
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 5|    5.  The owner shall pay all trade contractors as required by the   |
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 6|Fair Pay for Construction Act; and                                     |
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 7|    6.  Contracts awarded under an agency construction management      |
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 8|delivery system shall not be modified such to permit the assignment    |
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 9|of subcontracts and/or trade packages to the construction manager.     |
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10|    D.  The procedures for awarding work under at-risk construction    |
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11|management are as follows:                                             |
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12|    1.  The construction manager, with the advice of the design        |
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13|consultant and subdivision, will develop individual bid packages for   |
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14|public bidding;                                                        |
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15|    2.  Whenever the estimated cost of the contract exceeds Fifty      |
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16|Thousand Dollars ($50,000.00), bid packages shall be let and awarded   |
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17|pursuant to the Public Competitive Bidding Act of 1974 and this        |
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18|section;                                                               |
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19|    3.  Bid packages with a value less than or equal to Fifty          |
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20|Thousand Dollars ($50,000.00) may be awarded by the political          |
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21|subdivision based on written comparative quotes.  Bid packages with    |
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22|a value less than or equal to Twenty-five Thousand Dollars             |
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23|($25,000.00) may be awarded by the political subdivision to any        |
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24|qualified vendor;                                                      |
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arsid6828605 ENGR. H. B. NO. 1661                                  Page 3
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 1|    4.  Once the bids are accepted by the construction manager and     |
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 2|awards made by the subdivision and the subdivision indicates its       |
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 3|bonding preference, as noted below, but before written agreements      |
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 4|are executed, the construction manager will prepare a guaranteed       |
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 5|maximum price (GMP) for the project or relevant portion of the work,   |
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 6|as an amendment to the contract.  After the subdivision approves the   |
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 7|construction manager's GMP amendment, the construction manager shall   |
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 8|enter into written subcontractor and supplier agreements for the       |
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 9|work previously awarded by the subdivision.  Upon receiving a notice   |
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10|to proceed with the work from the subdivision or its designee, the     |
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11|subdivision shall have the option, but not mandate, to require the     |
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12|construction manager to provide performance, payment and maintenance   |
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13|bonds, or any combination, in an amount equal to one hundred percent   |
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14|(100%) of the value of the work, excluding the construction            |
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15|manager's fee, general conditions, reimbursements and insurances.      |
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16|"Payment bond", "performance bond" and "maintenance bond", as used     |
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17|herein, mean and refer to those bonds as defined in the Public         |
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18|Competitive Bidding Act of 1974;                                       |
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19|    5.  The construction manager may require bonds from                |
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20|subcontractors or suppliers in an amount equal to one hundred          |
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21|percent (100%) of the value of their bid packages for subcontractors   |
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22|or suppliers not subject to bonding requirements of the Public         |
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23|Competitive Bidding Act of 1974.  In such cases, the bonding           |
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24|requirements shall be set forth in the bidding documents;              |
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arsid6828605 ENGR. H. B. NO. 1661                                  Page 4
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 1|    6.  The construction manager's work performed under this section   |
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 2|may be on a lump-sum basis and subject to the change order             |
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 3|limitations for a public construction contract as set forth in the     |
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 4|Public Competitive Bidding Act of 1974 or may be performed under a     |
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 5|cost-plus basis as determined by the subdivision;                      |
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 6|    7.  The subdivision may withhold retainage from the construction   |
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 7|manager's progress pay applications as set forth in the Public         |
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 8|Competitive Bidding Act of 1974.  The owner shall pay the              |
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 9|construction manager as required by the Fair Pay for Construction      |
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10|Act; and                                                               |
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11|    8.  If a construction manager at-risk wishes to self-perform       |
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12|portions of the work to be performed, it may do so, provided the       |
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13|construction manager at-risk competitively bids the work under the     |
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14|same terms and conditions as the other bidders and the construction    |
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15|manager at-risk is the lowest responsible bidder for the work scope    |
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16|on which the bid was submitted.                                        |
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17|    E.  When bids for a public construction project have been          |
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18|received from general contractors pursuant to the Public Competitive   |
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19|Bidding Act of 1974 and the lowest responsible bid is within the       |
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20|subdivision's available funding, the subdivision shall not reject      |
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21|all bids and subsequently award the project to a construction          |
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22|manager.                                                               |
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23|    SECTION 2.  This act shall become effective November 1, 2021.      |
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arsid6828605 ENGR. H. B. NO. 1661                                  Page 5
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 1|    Passed the House of Representatives the 1st day of March, 2021.    |
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  |                                     Presiding Officer of the House    |
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  |    Passed the Senate the ___ day of __________, 2021.                 |
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arsid6828605 ENGR. H. B. NO. 1661                                  Page 6
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