Bill Text For HB2666 - Senate Floor Version

 1|                        SENATE FLOOR VERSION                           |
  |                           April 11, 2019                              |
 2|                             AS AMENDED                                |
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 3|ENGROSSED HOUSE                                                        |
  |BILL NO. 2666                        By: Wallace of the House          |
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  |                                         and                           |
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  |                                         Leewright of the Senate       |
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 7|                                                                       |
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 8|       [ public buildings and public works - project                   |
  |       consultants - Public Facilities Act - Public                    |
 9|       Construction Management Act for Political                       |
  |       Subdivisions - repealer - codification - effective              |
10|       date ]                                                          |
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11|                                                                       |
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12|                                                                       |
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13|BE IT ENACTED BY THE PEOPLE OF THE STATE OF OKLAHOMA:                  |
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14|    SECTION 1.     AMENDATORY     61 O.S. 2011, Section 61, as last    |
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15|amended by Section 2, Chapter 71, O.S.L. 2016 (61 O.S. Supp. 2018,     |
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16|Section 61), is amended to read as follows:                            |
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17|    Section 61.  As used in Sections 61 through 65 of this title:      |
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18|    1.  "Chief administrative officer" means an individual             |
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19|responsible for directing the administration of a state agency.  The   |
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20|term does not mean one or all of the individuals that make policy      |
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21|for a state agency;                                                    |
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22|    2.  "Construction manager" means an individual, firm,              |
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23|corporation, association, partnership, copartnership, or any other     |
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24|legal entity on the Office of Management and Enterprise Services       |
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arsid7345670 SENATE FLOOR VERSION - HB2666 SFLR                    Page 1
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 1|Construction and Properties (OMES-CAP) registration list and           |
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 2|possessing the qualifications to provide services of construction      |
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 3|management which include, but are not necessarily limited to, design   |
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 4|review, scheduling, cost control, value engineering,                   |
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 5|constructability evaluation, preparation and coordination of bid       |
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 6|packages, and construction administration;                             |
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 7|    3.  "Consultant" means an individual or legal entity possessing    |
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 8|the qualifications to provide licensed architectural, registered       |
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 9|engineering, or registered land surveying services or other            |
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10|individuals or legal entities possessing specialized credentials and   |
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11|qualifications as may be needed to evaluate, plan or design and/or     |
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12|provide construction administration and/or construction inspection     |
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13|services for any construction or a public work improvement project;    |
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14|    4.  "Director" means the Director of the Office of Management      |
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15|and Enterprise Services;                                               |
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16|    5.  "Department" means the Department of Real Estate Services of   |
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17|the Office of Management and Enterprise Services;                      |
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18|    6.  "Office" means the Office of Management and Enterprise         |
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19|Services;                                                              |
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20|    7.  "Project" means studies, evaluations, plans or designs for     |
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21|facility evaluations or public work improvements, except the           |
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22|transportation facilities under the jurisdiction of the Department     |
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23|of Transportation or the Oklahoma Turnpike Authority:                  |
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24|                                                                       |
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arsid7345670 SENATE FLOOR VERSION - HB2666 SFLR                    Page 2
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 1|         a.    to construct, renovate, alter, repair, maintain, or     |
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 2|              improve real property or fixtures of real property,      |
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 3|              and                                                      |
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 4|         b.    that does not constitute "construction" as defined by   |
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 5|              the Public Building Construction and Planning Act;       |
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 6|    8.  "State agency" means an agency, office, officer, bureau,       |
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 7|board, counsel, court, commission, institution, unit, division, body   |
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 8|or house of the executive or judicial branches of state government,    |
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 9|whether elected or appointed, excluding only political subdivisions    |
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10|of the state, the Oklahoma State Regents for Higher Education and      |
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11|its constituent institutions and the Commissioners of the Land         |
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12|Office; and                                                            |
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13|    9.  "Facilities Director" or "SFD" means the State Facilities      |
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14|Director of the Department of Real Estate Services of the Office of    |
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15|Management and Enterprise Services; and                                |
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16|    10.  "Political subdivision" means any local governmental body     |
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17|formed pursuant to the laws of this state, including, but not          |
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18|limited to, school districts, career technology centers, cities,       |
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19|counties, public trusts, public authorities, commissions or other      |
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20|local governmental bodies exercising their authority to contract       |
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21|with construction managers and/or consultants.  The term also means    |
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22|any quasi-governmental and nongovernmental organizations contracting   |
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23|with construction managers and/or consultants using public funds or    |
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24|on behalf of a political subdivision.                                  |
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arsid7345670 SENATE FLOOR VERSION - HB2666 SFLR                    Page 3
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 1|    SECTION 2.     AMENDATORY     61 O.S. 2011, Section 62, as last    |
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 2|amended by Section 3, Chapter 302, O.S.L. 2013 (61 O.S. Supp. 2018,    |
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 3|Section 62), is amended to read as follows:                            |
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 4|    Section 62.  A.  The Department of Real Estate Services of the     |
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 5|Office of Management and Enterprise Services shall maintain a file     |
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 6|of all persons and entities interested in and capable of performing    |
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 7|construction management and consultant services for state agencies.    |
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 8|The file shall include registration forms and information submitted    |
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 9|by construction managers and consultants pursuant to rules             |
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10|promulgated by the Office of Management and Enterprise Services.       |
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11|Pursuant to rules promulgated by the Office, the Department shall      |
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12|determine whether a construction manager or consultant qualifies for   |
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13|registration and shall notify the construction manager or consultant   |
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14|within twenty (20) days of receipt of a request for registration.      |
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15|Construction managers and consultants shall re-register for each       |
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16|successive calendar year with the Department.                          |
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17|    B.  The requisitioning state agency shall define the scope of a    |
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18|proposed project.  The scope shall identify project components,        |
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19|phases and timetables and shall include detailed project               |
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20|descriptions.  The state agency may request the Department to assist   |
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21|with scope development.  The state agency shall send the scope and a   |
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22|requisition for construction management or consultant services,        |
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23|signed by an authorized official, to the Department.  The Department   |
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24|                                                                       |
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arsid7345670 SENATE FLOOR VERSION - HB2666 SFLR                    Page 4
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 1|shall review the scope and approve it before the state agency issues   |
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 2|a solicitation.                                                        |
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 3|    C.  The state agency shall issue a solicitation to construction    |
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 4|managers or consultants that are registered with the Department and    |
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 5|capable of providing the services the state agency desires.  The       |
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 6|solicitation shall, at a minimum, contain:                             |
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 7|    1.  Description and scope of the project;                          |
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 8|    2.  Estimated construction cost or available funds, anticipated    |
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 9|starting date, and completion date the state agency desires for the    |
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10|project;                                                               |
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11|    3.  Certification of funds available for the construction          |
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12|manager or consultant fee, including federal, state or other           |
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13|participation;                                                         |
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14|    4.  Closing date for construction manager or consultant to give    |
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15|notice of interest to the state agency; and                            |
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16|    5.  Additional data the state agency requires from the             |
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17|construction manager or consultant.  The closing date for submission   |
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18|of construction manager or consultant notice of interest for           |
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19|consideration shall be within thirty (30) days of the date of the      |
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20|notice the state agency issues.                                        |
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21|    D.  After the closing date, the Department shall provide           |
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22|information from the construction managers' or consultants' files to   |
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23|the state agency.  Should there be an inadequate expression of         |
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24|interest in the project, the state agency and Department personnel     |
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arsid7345670 SENATE FLOOR VERSION - HB2666 SFLR                    Page 5
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 1|shall confer to add construction managers or consultants for           |
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 2|consideration.                                                         |
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 3|    E.  The state agency shall review the information the Department   |
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 4|provides and shall select no less than three and no more than five     |
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 5|construction managers or consultants per contract for interviews.      |
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 6|The review shall include consideration of factors from the             |
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 7|information the Department supplies including, but not limited to:     |
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 8|    1.  Professional qualifications for the type of work               |
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 9|contemplated;                                                          |
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10|    2.  Capacity for completing the project in the specified time      |
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11|period; and                                                            |
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12|    3.  Past performance on projects of a similar nature.              |
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13|    F.  The Department shall advise the state agency of the methods    |
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14|to be used to conduct an evaluation, interview, selection, contract    |
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15|negotiation, and fee negotiation processes pursuant to rules           |
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16|promulgated by the Office of Management and Enterprise Services.       |
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17|    G.  1.  Upon completion of contract negotiation with the highest   |
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18|qualified construction manager or consultant, which contract shall     |
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19|include a fair and reasonable fee, the Department shall approve and    |
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20|award the contract.                                                    |
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21|    2.  If the Department and the first-choice construction manager    |
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22|or consultant cannot reach an agreement, the negotiations shall        |
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23|terminate and negotiations with the second-choice construction         |
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24|manager or consultant shall commence.  If the Department and the       |
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arsid7345670 SENATE FLOOR VERSION - HB2666 SFLR                    Page 6
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 1|second-choice construction manager or consultant cannot reach an       |
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 2|agreement, the negotiations shall terminate and negotiations with      |
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 3|the third-choice construction manager or consultant shall commence.    |
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 4|If the Department and the third-choice construction manager or         |
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 5|consultant cannot reach an agreement, then all negotiations shall      |
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 6|terminate.  Should the Department be unable to negotiate a             |
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 7|satisfactory contract with any of the three selected construction      |
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 8|managers or consultants, the Department shall select additional        |
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 9|construction managers or consultants in order of their competency      |
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10|and qualifications and shall continue negotiations in accordance       |
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11|with the provisions of this section until an agreement is reached.     |
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12|    H.  Any plans developed pursuant to the process for selection of   |
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13|a contractor for construction of a facility authorized pursuant to     |
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14|Section 183 of Title 73 of the Oklahoma Statutes shall become the      |
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15|property of the State of Oklahoma as a condition of the award of the   |
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16|final contract for construction of the facility.                       |
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17|    I.  For all state agencies subject to the Public Facilities Act,   |
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18|Sections 202 through 220 213 of this title, the Department shall       |
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19|perform the necessary procurement actions on behalf of a               |
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20|requisitioning agency as enumerated in subsections B through H of      |
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21|this section:                                                          |
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22|    1.  Determine or approve the agency's scope of a project and       |
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23|required services as provided in the Public Facilities Act;            |
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24|                                                                       |
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arsid7345670 SENATE FLOOR VERSION - HB2666 SFLR                    Page 7
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 1|    2.  Issue solicitations for construction manager and consultant    |
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 2|services;                                                              |
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 3|    3.  Conduct evaluations, interviews, selection, contract           |
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 4|negotiation, and fee negotiation processes; and                        |
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 5|    4.  Provide contract management services after award of a          |
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 6|construction management or consultant contract.                        |
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 7|    J.  In the selection of a construction manager or consultant,      |
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 8|all political subdivisions of this state shall follow these            |
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 9|procedures:                                                            |
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10|    The subdivision shall select a construction manager or             |
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11|consultant based upon the professional qualifications and technical    |
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12|experience of the construction manager or consultant.  The             |
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13|subdivision shall negotiate a contract with the highest qualified      |
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14|construction manager or consultant, provided that a fee can be         |
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15|negotiated that is fair and reasonable to both parties.  In the        |
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16|event a reasonable fee cannot be negotiated with the selected          |
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17|construction manager or consultant, the subdivision may negotiate      |
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18|with other construction managers or consultants in order of their      |
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19|qualifications.                                                        |
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20|    K.  In the selection of a construction manager, all political      |
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21|subdivisions of this state shall:                                      |
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22|    1.  Extend consideration to construction managers from the file    |
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23|maintained by the Department of Real Estate Services of the Office     |
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24|of Management and Enterprise Services.  Political subdivisions are     |
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arsid7345670 SENATE FLOOR VERSION - HB2666 SFLR                    Page 8
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 1|not limited in the number of construction manager candidates from      |
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 2|whom they intend on seeking proposals;                                 |
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 3|    2.  Evaluate the candidates' professional qualifications,          |
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 4|licensing, registration, certifications, technical abilities and       |
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 5|past experience relevant to the contemplated project.  Only firms      |
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 6|recognized as qualified construction managers by the Department of     |
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 7|Real Estate Services of the Office of Management and Enterprise        |
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 8|Services pursuant to this section may be considered for selection as   |
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 9|a construction manager.  The subdivision shall use procedures as       |
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10|described in this section and the Public Construction Management Act   |
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11|for Political Subdivisions or may adopt procedures established by      |
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12|the Office of Management and Enterprise Services for state agencies;   |
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13|and                                                                    |
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14|    3.  Consider only professional attributes of the construction      |
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15|managers during the evaluation process and shall not discuss fees.     |
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16|Once the first-choice construction manager candidate is determined,    |
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17|the subdivision shall enter into contract negotiations with the        |
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18|candidate.  If the subdivision cannot reach an agreement with the      |
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19|first-choice construction manager, the negotiations shall terminate    |
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20|and negotiations with the next-choice construction manager shall       |
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21|commence.  The negotiations shall continue in this manner with each    |
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22|successive candidate until an agreement is reached.  If the            |
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23|subdivision and any of the construction manager candidates cannot      |
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24|reach an agreement, then all negotiations shall terminate and the      |
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 1|subdivision shall restart the process as described in this section     |
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 2|and in the Public Construction Management Act for Political            |
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 3|Subdivision, if applicable.                                            |
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 4|    SECTION 3.     AMENDATORY     61 O.S. 2011, Section 201, as        |
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 5|amended by Section 6, Chapter 302, O.S.L. 2013 (61 O.S. Supp. 2018,    |
  |                                                                       |
 6|Section 201), is amended to read as follows:                           |
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 7|    Section 201.  Sections 202 through 220 213 of this title shall     |
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 8|be known and may be cited as the "Public Facilities Act".              |
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 9|    SECTION 4.     AMENDATORY     61 O.S. 2011, Section 202, as last   |
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10|amended by Section 3, Chapter 71, O.S.L. 2016 (61 O.S. Supp. 2018,     |
  |                                                                       |
11|Section 202), is amended to read as follows:                           |
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12|    Section 202.  As used in the Public Facilities Act:                |
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13|    1.  "Annual capital plan" means the collective state facility      |
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14|capital improvements, facility operations and maintenance, rent and    |
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15|lease payments, facility debt services, water, sewer and energy        |
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16|utilities and real property transactions approved by the Legislature   |
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17|in a capital budget relative to state construction, maintenance, and   |
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18|real estate services;                                                  |
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19|    2.  "Capital planning and asset management" means the processes    |
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20|delegated to the Department of Real Estate Services for real           |
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21|property data acquisition, data analysis and determination of          |
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22|capital construction projects and procurement related to real          |
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23|property;                                                              |
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24|                                                                       |
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arsid7345670 SENATE FLOOR VERSION - HB2666 SFLR                    Page 10
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 1|    3.  "Construction" means the process of planning, acquiring,       |
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 2|designing, building, equipping, altering, repairing, improving,        |
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 3|maintaining, leasing, disposing or demolishing any structure or        |
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 4|appurtenance thereto including facilities, utilities, or other         |
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 5|improvements to any real property but not including highways,          |
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 6|bridges, airports, railroads, tunnels, sewers not related to a         |
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 7|structure or appurtenance thereto, or dams;                            |
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 8|    4.  "Construction administration" means a series of actions        |
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 9|required of the State Facilities Director, of other state agency       |
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10|employees, or, under a construction administration contract or         |
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11|contract provision, to ensure the full, timely, and proper             |
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12|performance of all phases of a construction project by all             |
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13|contractors, suppliers, and other persons having responsibility for    |
  |                                                                       |
14|project work and any guarantees or warranties pertaining thereto;      |
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15|    5.  "Department" means the Department of Real Estate Services of   |
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16|the Office of Management and Enterprise Services;                      |
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17|    6.  "Construction management" means a project delivery method      |
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18|based on an agreement whereby the owner acquires from a construction   |
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19|entity a series of services that include, but are not necessarily      |
  |                                                                       |
20|limited to, design review, scheduling, cost control, value             |
  |                                                                       |
21|engineering, constructability evaluation, preparation and              |
  |                                                                       |
22|coordination of bid packages, and construction administration;         |
  |                                                                       |
23|"construction management" includes:                                    |
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24|                                                                       |
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 1|         a.    "agency construction management" whereby the            |
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 2|              construction entity provides services to the owner       |
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 3|              without taking on financial risks for the execution of   |
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 4|              the actual construction or time of performance, and      |
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 5|              the owner contracts directly with those awarded trade    |
  |                                                                       |
 6|              contracts for the work, and                              |
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 7|         b.    "at-risk construction management" whereby the           |
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 8|              construction entity, after providing agency services     |
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 9|              during the pre-construction period,:                     |
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10|              (1)   takes on the financial obligation to timely        |
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11|                   carry out construction under a specified cost       |
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12|                   agreement, and                                      |
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13|              (2)   enters into written subcontracts for the work in   |
  |                                                                       |
14|                   accordance with the construction management         |
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15|                   procedures for state agencies;                      |
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16|    7.  "Consultant" means an individual or legal entity possessing    |
  |                                                                       |
17|the qualifications to provide licensed architectural, registered       |
  |                                                                       |
18|engineering, registered land surveying, certified appraisal, land      |
  |                                                                       |
19|title, or abstract services or possessing specialized credentials      |
  |                                                                       |
20|and qualifications as may be needed to evaluate, plan or design for    |
  |                                                                       |
21|any construction or public work improvement project, or to lease,      |
  |                                                                       |
22|acquire or dispose of state-owned real property;                       |
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23|    8.  "Division" means the Construction and Properties Division of   |
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24|the Office of Management and Enterprise Services;                      |
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 1|    9.  "Energy performance index or indices" (EPI) means a number     |
  |                                                                       |
 2|describing the energy requirements at the building boundary of a       |
  |                                                                       |
 3|structure, per square foot of floor space or per cubic foot of         |
  |                                                                       |
 4|occupied volume, as appropriate under defined internal and external    |
  |                                                                       |
 5|ambient conditions over an entire seasonal cycle.  As experience       |
  |                                                                       |
 6|develops on the energy performance achieved with state construction,   |
  |                                                                       |
 7|the indices (EPI) will serve as a measure of structure performance     |
  |                                                                       |
 8|with respect to energy consumption;                                    |
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 9|    10.  "Facilities Director" or "SFD" means the State Facilities     |
  |                                                                       |
10|Director of the Department of Real Estate Services of the Office of    |
  |                                                                       |
11|Management and Enterprise Services;                                    |
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12|    11.  "Life cycle costs" means the cost of owning, operating, and   |
  |                                                                       |
13|maintaining the structure over the life of the structure.  This may    |
  |                                                                       |
14|be expressed as an annual cost for each year of the facility's use;    |
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15|    12.  "Office" means the Office of Management and Enterprise        |
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16|Services;                                                              |
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17|    13.  "Procurement" means buying, purchasing, renting, leasing,     |
  |                                                                       |
18|allocating, trading or otherwise acquiring or disposing of supplies,   |
  |                                                                       |
19|services, or construction necessary to evaluate, plan, construct,      |
  |                                                                       |
20|manage, operate and preserve real property capital assets;             |
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21|    14.  "Public improvement" means any beneficial or valuable         |
  |                                                                       |
22|change or addition, betterment, enhancement or amelioration of or      |
  |                                                                       |
23|upon any real property, or interest therein, belonging to a state      |
  |                                                                       |
24|agency and the State of Oklahoma, intended to enhance its value,       |
  |                                                                       |
arsid7345670 SENATE FLOOR VERSION - HB2666 SFLR                    Page 13
___________________________________________________________________________

 1|beauty or utility or to adapt it to new or further purposes.  The      |
  |                                                                       |
 2|term does not include the direct purchase of materials used for        |
  |                                                                       |
 3|general repairs and maintenance to state facilities;                   |
  |                                                                       |
 4|    15.  "Shared savings financing" means the financing of energy      |
  |                                                                       |
 5|conservation measures and maintenance services through a private       |
  |                                                                       |
 6|firm which may own any purchased equipment for the duration of a       |
  |                                                                       |
 7|contract.  Such contract shall specify that the private firm will be   |
  |                                                                       |
 8|recompensed either out of a negotiated portion of the savings          |
  |                                                                       |
 9|resulting from the conservation measures and maintenance services      |
  |                                                                       |
10|provided by the private firm or, in the case of a cogeneration         |
  |                                                                       |
11|project, through the payment of a rate for energy lower than would     |
  |                                                                       |
12|otherwise have been paid for the same energy from current sources;     |
  |                                                                       |
13|and                                                                    |
  |                                                                       |
14|    16.  "State agency" means an agency, board, commission, counsel,   |
  |                                                                       |
15|court, office, officer, bureau, institution, unit, division, body,     |
  |                                                                       |
16|or house of the executive or judicial branches of government of this   |
  |                                                                       |
17|state, whether elected or appointed, excluding only political          |
  |                                                                       |
18|subdivisions, the Oklahoma State Regents for Higher Education and      |
  |                                                                       |
19|its constituent institutions and the Commissioners of the Land         |
  |                                                                       |
20|Office.                                                                |
  |                                                                       |
21|    SECTION 5.     AMENDATORY     61 O.S. 2011, Section 202.1, as      |
  |                                                                       |
22|last amended by Section 8, Chapter 302, O.S.L. 2013 (61 O.S. Supp.     |
  |                                                                       |
23|2018, Section 202.1), is amended to read as follows:                   |
  |                                                                       |
24|                                                                       |
  |                                                                       |
arsid7345670 SENATE FLOOR VERSION - HB2666 SFLR                    Page 14
___________________________________________________________________________

 1|    Section 202.1  A.  The design-build and construction management    |
  |                                                                       |
 2|project delivery methods shall not be used without the written         |
  |                                                                       |
 3|approval of the Director of the Office of Management and Enterprise    |
  |                                                                       |
 4|Services, or the Director's designee, when those projects are          |
  |                                                                       |
 5|constructed for a state agency or by an act of the Legislature         |
  |                                                                       |
 6|specifying design-build or at-risk construction management for a       |
  |                                                                       |
 7|project.  In all instances where the design-build project or at-risk   |
  |                                                                       |
 8|construction management delivery method is authorized, construction    |
  |                                                                       |
 9|administration shall be performed by the State Facilities Director,    |
  |                                                                       |
10|the SFD's designee or designees, or otherwise by contract or           |
  |                                                                       |
11|contract provision approved by the Director of the Office of           |
  |                                                                       |
12|Management and Enterprise Services for construction administration     |
  |                                                                       |
13|by another party.                                                      |
  |                                                                       |
14|    B.  Municipalities, counties, public trusts, or any other          |
  |                                                                       |
15|political subdivision in this state shall not be required to get       |
  |                                                                       |
16|approval of any other state agency in order to use agency              |
  |                                                                       |
17|construction management or at-risk construction management as a        |
  |                                                                       |
18|construction delivery method.  However, municipalities, counties,      |
  |                                                                       |
19|public trusts, and any other political subdivision shall be subject    |
  |                                                                       |
20|to Section 220 of this title.                                          |
  |                                                                       |
21|    C.  The design-build and construction management project           |
  |                                                                       |
22|delivery methods shall not be used for any project unless the          |
  |                                                                       |
23|project meets the criteria established by the administrative rules     |
  |                                                                       |
24|promulgated as required by this act.  Such methods shall not be used   |
  |                                                                       |
arsid7345670 SENATE FLOOR VERSION - HB2666 SFLR                    Page 15
___________________________________________________________________________

 1|unless there is a need for compressed construction time as required    |
  |                                                                       |
 2|to respond to a natural disaster or other emergency situation          |
  |                                                                       |
 3|affecting public health and safety, or all of the following criteria   |
  |                                                                       |
 4|for designation are met:                                               |
  |                                                                       |
 5|    1.  The project benefits the public;                               |
  |                                                                       |
 6|    2.  There is a need for cost control; and                          |
  |                                                                       |
 7|    3.  The need exists for specialized or complex construction        |
  |                                                                       |
 8|methods due to the unique nature of the project.                       |
  |                                                                       |
 9|    D.  The use of design-build and construction management project    |
  |                                                                       |
10|delivery methods shall not interfere or inhibit the opportunity for    |
  |                                                                       |
11|subcontractors and trade contractors to openly and freely compete      |
  |                                                                       |
12|for subcontracts or trade contracts pursuant to the Public             |
  |                                                                       |
13|Competitive Bidding Act of 1974 with respect to public notices.  The   |
  |                                                                       |
14|State Facilities Director, or designee, or the construction manager    |
  |                                                                       |
15|shall make the subcontracting and supply opportunities publicly        |
  |                                                                       |
16|known, as follows:                                                     |
  |                                                                       |
17|    1.  Whenever the estimated cost of the contract exceeds Fifty      |
  |                                                                       |
18|Thousand Dollars ($50,000.00), public notice shall be given by         |
  |                                                                       |
19|publication in a newspaper of general circulation and published in     |
  |                                                                       |
20|the county where the work, or the major part of the work, is to be     |
  |                                                                       |
21|done.  Such notice by publication shall be published in two            |
  |                                                                       |
22|consecutive weekly issues of the newspaper, with the first             |
  |                                                                       |
23|publication thereof to be at least twenty-one (21) days prior to the   |
  |                                                                       |
24|date set for opening bids; and                                         |
  |                                                                       |
arsid7345670 SENATE FLOOR VERSION - HB2666 SFLR                    Page 16
___________________________________________________________________________

 1|    2.  Notice thereof shall be sent to one in-state trade or          |
  |                                                                       |
 2|construction publication for the publication's use and information     |
  |                                                                       |
 3|whenever the estimated cost of the contract exceeds Fifty Thousand     |
  |                                                                       |
 4|Dollars ($50,000.00); provided, however, this section shall not be     |
  |                                                                       |
 5|construed to require the publication of such notice in such trade or   |
  |                                                                       |
 6|construction publication or to require the provision of such notice    |
  |                                                                       |
 7|to more than one in-state trade or construction publication or to      |
  |                                                                       |
 8|any out-of-state trade or construction publication.                    |
  |                                                                       |
 9|    C.  Bids shall be publicly opened at the time and place            |
  |                                                                       |
10|designated in the public notice.  A representative of the State        |
  |                                                                       |
11|Facilities Director shall be present at the bid opening.               |
  |                                                                       |
12|    E. D.  The provisions of subsections subsection A and B of this    |
  |                                                                       |
13|section shall not apply to projects by contract pursuant to an         |
  |                                                                       |
14|interagency agreement under Section 581 of Title 74 of the Oklahoma    |
  |                                                                       |
15|Statutes or to projects a state agency performs solely with the        |
  |                                                                       |
16|staff of the agency.                                                   |
  |                                                                       |
17|    F. E.  The Office of Management and Enterprise Services shall,     |
  |                                                                       |
18|pursuant to the Administrative Procedures Act, promulgate rules to     |
  |                                                                       |
19|effect procedures, processes and design-build/construction             |
  |                                                                       |
20|management fee guidelines necessary to the fulfillment of its          |
  |                                                                       |
21|responsibilities under this section.                                   |
  |                                                                       |
22|    G.  As used in the Public Facilities Act, public trusts shall      |
  |                                                                       |
23|not include state beneficiary public trusts.                           |
  |                                                                       |
24|                                                                       |
  |                                                                       |
arsid7345670 SENATE FLOOR VERSION - HB2666 SFLR                    Page 17
___________________________________________________________________________

 1|    SECTION 6.     NEW LAW     A new section of law to be codified     |
  |                                                                       |
 2|in the Oklahoma Statutes as Section 215 of Title 61, unless there is   |
  |                                                                       |
 3|created a duplication in numbering, reads as follows:                  |
  |                                                                       |
 4|    Sections 6 through 8 of this act shall be known and may be cited   |
  |                                                                       |
 5|as the "Public Construction Management Act for Political               |
  |                                                                       |
 6|Subdivisions".                                                         |
  |                                                                       |
 7|    SECTION 7.     NEW LAW     A new section of law to be codified     |
  |                                                                       |
 8|in the Oklahoma Statutes as Section 216 of Title 61, unless there is   |
  |                                                                       |
 9|created a duplication in numbering, reads as follows:                  |
  |                                                                       |
10|    A.  The Public Construction Management Act for Political           |
  |                                                                       |
11|Subdivisions shall apply to political subdivisions of this state.      |
  |                                                                       |
12|    B.  As used in the Public Construction Management Act for          |
  |                                                                       |
13|Political Subdivisions:                                                |
  |                                                                       |
14|    1.  "Agency construction management" means the construction        |
  |                                                                       |
15|entity provides services to the owner without taking on financial      |
  |                                                                       |
16|risks for the execution of the actual construction and/or time of      |
  |                                                                       |
17|performance, and the owner contracts directly with those awarded       |
  |                                                                       |
18|trade contracts for the work;                                          |
  |                                                                       |
19|    2.  "At-risk construction management" means the construction       |
  |                                                                       |
20|entity, after providing agency services during the preconstruction     |
  |                                                                       |
21|period:                                                                |
  |                                                                       |
22|         a.    takes on the financial obligation to timely carry out   |
  |                                                                       |
23|              construction under a specified cost agreement, and       |
  |                                                                       |
24|                                                                       |
  |                                                                       |
arsid7345670 SENATE FLOOR VERSION - HB2666 SFLR                    Page 18
___________________________________________________________________________

 1|         b.    enters into written subcontracts for the work in        |
  |                                                                       |
 2|              accordance with the Construction Management Procedures   |
  |                                                                       |
 3|              for Political Subdivisions;                              |
  |                                                                       |
 4|    3.  "Construction management" means a public construction          |
  |                                                                       |
 5|project delivery method based on an agreement whereby the owner        |
  |                                                                       |
 6|acquires from a construction entity a series of services that          |
  |                                                                       |
 7|include, but are not necessarily limited to, design review,            |
  |                                                                       |
 8|scheduling, cost control, value engineering, constructability          |
  |                                                                       |
 9|evaluation, preparation and coordination of bid packages and           |
  |                                                                       |
10|construction administration.  Construction management includes:        |
  |                                                                       |
11|         a.    agency construction management, and                     |
  |                                                                       |
12|         b.    at-risk construction management; and                    |
  |                                                                       |
13|    4.  "Political subdivision" or "subdivision" means any local       |
  |                                                                       |
14|governmental body formed pursuant to the laws of this state,           |
  |                                                                       |
15|including, but not limited to, school districts, vocational            |
  |                                                                       |
16|education districts, cities, counties, public trusts, public           |
  |                                                                       |
17|authorities, commissions or other local governmental bodies            |
  |                                                                       |
18|exercising their authority to contract for public construction         |
  |                                                                       |
19|delivery services.  The term also applies to quasi-governmental and    |
  |                                                                       |
20|nongovernmental organizations delivering construction services using   |
  |                                                                       |
21|public funds or on behalf of a political subdivision.                  |
  |                                                                       |
22|    SECTION 8.     NEW LAW     A new section of law to be codified     |
  |                                                                       |
23|in the Oklahoma Statutes as Section 217 of Title 61, unless there is   |
  |                                                                       |
24|created a duplication in numbering, reads as follows:                  |
  |                                                                       |
arsid7345670 SENATE FLOOR VERSION - HB2666 SFLR                    Page 19
___________________________________________________________________________

 1|    A.  Construction managers shall be selected by the political       |
  |                                                                       |
 2|subdivision following the requirements set forth in subsection K of    |
  |                                                                       |
 3|Section 62 of Title 61 of the Oklahoma Statutes.                       |
  |                                                                       |
 4|    B.  A written contract between the political subdivision and the   |
  |                                                                       |
 5|construction manager shall set forth the obligations of the parties,   |
  |                                                                       |
 6|which, at a minimum, shall include the construction manager's scope    |
  |                                                                       |
 7|of services, fees and expenses, as follows:                            |
  |                                                                       |
 8|    1.  A construction management fee, which may be based on a         |
  |                                                                       |
 9|percentage of the construction cost or as defined in the contract;     |
  |                                                                       |
10|    2.  The cost or basis of cost expenses incurred by the             |
  |                                                                       |
11|construction manager to be reimbursed by the subdivision for normal    |
  |                                                                       |
12|general conditions and general requirements necessary for the work     |
  |                                                                       |
13|but not applicable to a particular subcontractor, trade contractor     |
  |                                                                       |
14|or supplier; and                                                       |
  |                                                                       |
15|    3.  Other project-related expenses as set forth in the contract.   |
  |                                                                       |
16|    C.  The procedures for awarding work under agency construction     |
  |                                                                       |
17|management are as follows:                                             |
  |                                                                       |
18|    1.  The construction manager, with the advice of the design        |
  |                                                                       |
19|consultant and subdivision, will develop individual bid packages for   |
  |                                                                       |
20|public bidding;                                                        |
  |                                                                       |
21|    2.  Public bidding on individual bid packages will comply with     |
  |                                                                       |
22|the requirements of the Public Competitive Bidding Act of 1974;        |
  |                                                                       |
23|    3.  The construction manager shall evaluate all bids and           |
  |                                                                       |
24|recommend the lowest responsible bidder to the subdivision, who        |
  |                                                                       |
arsid7345670 SENATE FLOOR VERSION - HB2666 SFLR                    Page 20
___________________________________________________________________________

 1|shall accept or reject the bids.  The construction manager may         |
  |                                                                       |
 2|assist the subdivision with the preparation of contracts and the       |
  |                                                                       |
 3|receipt of insurance and bonds as required for public construction     |
  |                                                                       |
 4|contracts by state law;                                                |
  |                                                                       |
 5|    4.  After trade contracts are awarded, the construction manager    |
  |                                                                       |
 6|will perform contract administrative services as set forth in the      |
  |                                                                       |
 7|agreement and may assist the subdivision with the review and           |
  |                                                                       |
 8|processing of progress and final payments to the subcontractors.       |
  |                                                                       |
 9|However, under no circumstances shall construction managers receive    |
  |                                                                       |
10|funds from subdivisions for payments of trade contractors;             |
  |                                                                       |
11|    5.  The owner shall pay all trade contractors as required by the   |
  |                                                                       |
12|Fair Pay for Construction Act; and                                     |
  |                                                                       |
13|    6.  Contracts awarded under an agency construction management      |
  |                                                                       |
14|delivery system shall not be modified such to permit the assignment    |
  |                                                                       |
15|of subcontracts and/or trade packages to the construction manager.     |
  |                                                                       |
16|    D.  The procedures for awarding work under at-risk construction    |
  |                                                                       |
17|management are as follows:                                             |
  |                                                                       |
18|    1.  The construction manager, with the advice of the design        |
  |                                                                       |
19|consultant and subdivision, will develop individual bid packages for   |
  |                                                                       |
20|public bidding;                                                        |
  |                                                                       |
21|    2.  Whenever the estimated cost of the contract exceeds Fifty      |
  |                                                                       |
22|Thousand Dollars ($50,000.00) bid packages shall be let and awarded    |
  |                                                                       |
23|pursuant to the Public Competitive Bidding Act of 1974 and this        |
  |                                                                       |
24|section;                                                               |
  |                                                                       |
arsid7345670 SENATE FLOOR VERSION - HB2666 SFLR                    Page 21
___________________________________________________________________________

 1|    3.  Bid packages with a value less than or equal to Fifty          |
  |                                                                       |
 2|Thousand Dollars ($50,000.00) may be awarded by the political          |
  |                                                                       |
 3|subdivision based on written comparative quotes.  Bid packages with    |
  |                                                                       |
 4|a value less than or equal to Twenty-five Thousand Dollars             |
  |                                                                       |
 5|($25,000.00) may be awarded by the political subdivision to any        |
  |                                                                       |
 6|qualified vendor;                                                      |
  |                                                                       |
 7|    4.  Once the bids are accepted by the construction manager and     |
  |                                                                       |
 8|awards made by the subdivision and the subdivision indicates its       |
  |                                                                       |
 9|bonding preference, as noted below, but before written agreements      |
  |                                                                       |
10|are executed, the construction manager will prepare a guaranteed       |
  |                                                                       |
11|maximum price (GMP) for the project or relevant portion of the work,   |
  |                                                                       |
12|as an amendment to the contract.  After the subdivision approves the   |
  |                                                                       |
13|construction manager's GMP amendment, the construction manager shall   |
  |                                                                       |
14|enter into written subcontractor and supplies agreements for the       |
  |                                                                       |
15|work previously awarded by the subdivision.  Upon receiving a notice   |
  |                                                                       |
16|to proceed with the work from the subdivision or its designee, the     |
  |                                                                       |
17|subdivision shall have the option, but not mandate, to require the     |
  |                                                                       |
18|construction manager to provide performance, payment and maintenance   |
  |                                                                       |
19|bonds, or any combination, in an amount equal to one hundred percent   |
  |                                                                       |
20|(100%) of the value of the work, excluding the construction            |
  |                                                                       |
21|manager's fee, general conditions, reimbursements and insurances.      |
  |                                                                       |
22|"Payment bond", "performance bond" and "maintenance bond", as used     |
  |                                                                       |
23|herein, mean and refer to those bonds as defined in the Public         |
  |                                                                       |
24|Competitive Bidding Act of 1974;                                       |
  |                                                                       |
arsid7345670 SENATE FLOOR VERSION - HB2666 SFLR                    Page 22
___________________________________________________________________________

 1|    5.  The construction manager may require bonds from                |
  |                                                                       |
 2|subcontractors or suppliers in an amount equal to one hundred          |
  |                                                                       |
 3|percent (100%) of the value of their bid packages for subcontractors   |
  |                                                                       |
 4|or suppliers not subject to bonding requirements of the Public         |
  |                                                                       |
 5|Competitive Bidding Act of 1974.  In such cases, the bonding           |
  |                                                                       |
 6|requirements shall be set forth in the bidding documents;              |
  |                                                                       |
 7|    6.  The construction manager's work performed under this section   |
  |                                                                       |
 8|may be on a lump-sum basis and subject to the change order             |
  |                                                                       |
 9|limitations for a public construction contract as set forth in the     |
  |                                                                       |
10|Public Competitive Bidding Act of 1974 or may be performed under a     |
  |                                                                       |
11|cost-plus basis as determined by the subdivision;                      |
  |                                                                       |
12|    7.  The subdivision may withhold retainage from the construction   |
  |                                                                       |
13|manager's progress pay applications as set forth in the Public         |
  |                                                                       |
14|Competitive Bidding Act of 1974.  The owner shall pay the              |
  |                                                                       |
15|construction manager as required by the Fair Pay for Construction      |
  |                                                                       |
16|Act; and                                                               |
  |                                                                       |
17|    8.  If a construction manager at-risk wishes to self-perform       |
  |                                                                       |
18|portions of the work to be performed, it may do so, provided the       |
  |                                                                       |
19|construction manager at-risk competitively bids the work under the     |
  |                                                                       |
20|same terms and conditions as the other bidders and the construction    |
  |                                                                       |
21|manager at-risk is the lowest responsible bidder for the work scope    |
  |                                                                       |
22|on which the bid was submitted.                                        |
  |                                                                       |
23|    E.  When bids for a public construction project have been          |
  |                                                                       |
24|received from general contractors pursuant to the Public Competitive   |
  |                                                                       |
arsid7345670 SENATE FLOOR VERSION - HB2666 SFLR                    Page 23
___________________________________________________________________________

 1|Bidding Act of 1974 and the lowest responsible bid is within the       |
  |                                                                       |
 2|subdivision's available funding, the subdivision shall not reject      |
  |                                                                       |
 3|all bids and subsequently award the project to a construction          |
  |                                                                       |
 4|manager.                                                               |
  |                                                                       |
 5|    SECTION 9.     REPEALER     61 O.S. 2011, Section 220, as last     |
  |                                                                       |
 6|amended by Section 18, Chapter 302, O.S.L. 2013 (61 O.S. Supp. 2018,   |
  |                                                                       |
 7|Section 220), is hereby repealed.                                      |
  |                                                                       |
 8|    SECTION 10.  This act shall become effective January 1, 2020.      |
  |                                                                       |
 9|COMMITTEE REPORT BY: COMMITTEE ON BUSINESS, COMMERCE AND TOURISM       |
  |April 11, 2019 - DO PASS AS AMENDED                                    |
10|                                                                       |
  |                                                                       |
11|                                                                       |
  |                                                                       |
12|                                                                       |
  |                                                                       |
13|                                                                       |
  |                                                                       |
14|                                                                       |
  |                                                                       |
15|                                                                       |
  |                                                                       |
16|                                                                       |
  |                                                                       |
17|                                                                       |
  |                                                                       |
18|                                                                       |
  |                                                                       |
19|                                                                       |
  |                                                                       |
20|                                                                       |
  |                                                                       |
21|                                                                       |
  |                                                                       |
22|                                                                       |
  |                                                                       |
23|                                                                       |
  |                                                                       |
24|                                                                       |
  |                                                                       |
arsid7345670 SENATE FLOOR VERSION - HB2666 SFLR                    Page 24
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