Building Procurement Fitness

1. Building Procurement Fitness Building Procurement Fitness Construction and Facilities Contracting Shirley McNutt, VCCO, VCO

2. Building Procurement Fitness

3. What is construction? What falls out when you shake the building upside down? What falls out is considered FF&E and not construction. Building Procurement Fitness

4. What is construction? Definition of Construction – Includes new construction, reconstruction, renovation, restoration, major repair, demolition, improvements and all similar work upon buildings and ancillary facilities owned or to be acquired by the Commonwealth, including any draining, dredging, excavation, grading or similar work upon real property. Building Procurement Fitness

5. What are Improvements? Alteration of interior space arrangement and other physical characteristics, such as utilities, so that it may be more effectively used for its present designated functional purpose; Conversion of interior arrangement and other physical characteristics, such as utilities and fixed equipment installed on and made a part of the facility or structure so that it may be effectively utilized for a new functional purpose; Renovation of most or all of a facility or structure, or an existing mechanical system for the purpose of modernizing the use or capability of such asset in order that it may be effectively utilized for its designated functional purpose or to comply with current code requirements; Restoration of a facility or structure to the maximum extent possible to its former or original state (historic property); Building Procurement Fitness

6. What is Repairs? Repair or replacement of damaged or inoperable equipment such as elevators, furnaces, plumbing fixtures, air conditioning and ventilation equipment. Repair or replacement of components of a plant such as masonry, ceilings, floor, floor coverings, roofs, sidewalks, parking lots, exterior lighting, boilers, and air conditioners; Repair or replacement of existing utility systems, such as electrical, water and sewer, heating & cooling. When replacement of components of utility systems is required (e.g. transformers, distribution panels, cables, etc.), new components should be sized to account for future growth if the existing components are operating at or near capacity. Correction of deficiencies in property and plant that are required to conform with building and safety codes or those regulations associated with hazard corrections, including asbestos hazards when incidental to repair/maintenance. Building Procurement Fitness

7. What is a Capital Project? For agencies of the Commonwealth of Virginia, a Capitol Project is generally defined as a project whose total budget exceeds $500,000. This budget is inclusive of design fees, construction, equipment, project management, etc. A Capital Project requires approval of the Governor or designee. These projects require a CO-2 for funding. Building Procurement Fitness

8. How do we buy construction? Building Procurement Fitness

9. Sealed Bids Here are the items that make up a sealed bid under $500,000: Sketches, design documents, or written scope Invitation for Bids Pre bid conference Bid Form Instructions to Bidders Terms and Conditions of the Contract If over $100,000 estimated value, bid bond forms and payment and performance bond forms Building Procurement Fitness

10. Advertising We use eVA and the VBO We use the Black Pages We use SWAM organizations We use plan rooms We use the newspaper We use word of mouth We sponsor workshops Building Procurement Fitness

11. Bidding and award process Addendums issued 10 days before bids due Hold pre bid conference Emphasize withdrawal of bids process Review bid forms (exercise) Bid tab Award on the VBO and attach bid tab Under $100,000 issue eVA order Greater than $100, 000 issue CO9 and eVA purchase order Building Procurement Fitness

12. Support Contracts for Construction and Facilities Operations Building Procurement Fitness

13. Contracts Inspection services and other non professional construction related services Energy performance management Facilities assessments Environmental assessments Commissioning Testing and Balancing Building Procurement Fitness

14. Inspection Services Asbestos containing materials Lead paint General construction inspection services Clerk of the works Project Manager Cost estimators Schedulers CAD operators Interior designers http://deb.dgs.virginia.gov/Contracts/Contracts-Details.asp?id=1 Building Procurement Fitness

15. Other Services Environmental assessments Facility assessments Testing and balancing Commissioning http://deb.dgs.virginia.gov/Contracts/Contracts-Details.asp?id=3 Building Procurement Fitness

16. Energy Performance Contracting Chiller and cooling tower replacements Co-generation plants New heating plants Replacing meters Re-lamping Window and envelope treatments Water fixture replacements Maintenance operations training Building automation Others http://deb.dgs.virginia.gov/Contracts/Contracts-Details.asp?id=2 Building Procurement Fitness

17. How to Implement a Project Consider your financing options State agency – MELP from Treasury Public bodies – municipal bonds Other options available Lease purchase Third party financing Outright purchase Lease Building Procurement Fitness

18. Elements of the Energy Contract Addresses the financing Methods and savings Type of financing Owner obligations Addresses the construction schedule Addresses the bidding process Addresses the maintenance Addresses measuring the savings Building Procurement Fitness

19. Synopsis of the Contract Process Selection of the ESCO for the project The public body will select 3 or more ESCOs from the pool to provide an approach to the agency project. The selection should be based on the ESCO experience, ability to respond and potential for funding model. This phase does not cost the public body anything; we call this “the back of the envelope proposal”. This provides the public body an analysis to determine if the cost investment is present for the energy savings. The public body will interview one or more ESCOs and negotiate a contract with them for performing the formal energy audit, developing the construction documents, performing project management, developing the financing model and developing the measurement and verification of the implemented energy savings. Building Procurement Fitness

20. Synopsis of the Contract Process Technical Energy Audit This is the phase where the ESCO performs the energy audit An MOU is established for the audit During the audit phase, the ESCO will perform a complete evaluation of the energy projects being recommended and perform a modeling exercise of the projected savings and timeframe An energy baseline is established along with the measurement standards The public body makes a determination to go forward. If the savings are not projected to cover the expense, then the public body will pay the ESCO for the detailed technical audit. If the public body goes forward with the project, then the financing needs to be defined. Building Procurement Fitness

21. Synopsis of the Contract Process Financing State Agency If estimated value of the project is greater than $3 million, then the project requires capital project authorization If the project is under $3 million then the project is handled as an operating expense Financing requires review of the Treasury Board Building Procurement Fitness