Job Order Contracting (JOC)

Report
CAPPO/NIGP CONFERENCE
WORKSHOP #4
JOB ORDER
CONTRACTING
1
Agenda
• Overview of Job Order Contracting
• Sacramento County’s JOC Program
• JOC Programs in California
• JOC Procurement Codes
• Questions & Answers
2
Job Order Contracting
Overview
3
Why JOC?
SACRAMENTO COUNTY
• Job Order Contracting (JOC) is all about efficiency and
value. Sacramento County struggled with the need to
procure quality construction, in a timely fashion, and at
a competitive price for the small to medium size repair,
remodel renovation work.
• What JOC did was enabled Sacramento County to focus
on completing projects instead of getting bogged down
in the procurement process.
4
Job Order Contracting Overview
Job Order Contracting (JOC) Is A Firm Fixed Priced,
Competitively Bid, Indefinite Quantity Procurement Process
For Small To Medium Sized Construction and Repair Projects.
JOC Creates a Fundamentally Different Construction
Procurement Relationship
Contractors Are Subjected To Different
Motivations And Behaviors
Fosters a Non-Adversarial Relationship Between
Public Agency & Contractor
5
Job Order Contracting Overview
Contract Documents
• Construction Task Catalog
• Technical Specifications
• General and special conditions
6
Job Order Contracting Overview
• Construction Task Catalog® (CTC)
• Contains over 240,000 Individual Construction Tasks
• Represents the “Scope of Work” of the Contract
• Inclusion of Tasks Customized for The County of
Sacramento
• Includes Specific County of Sacramento Approved
Products
• Priced Using Local Prevailing Labor, Material,
Equipment Prices
7
Job Order Contracting Overview
• Technical Specifications
• Customized for The County
of Sacramento that
Incorporate County Quality
Standards
• Clearly Tells the Contractors
What Is Required for Each
Task in the CTC®
• Specifications Must Be
Linked to Tasks in the CTC
8
Job Order Contracting Overview
• JOC General Conditions & Bidding Documents
• Critical Document
• Must be Consistent with Procurement Laws
• Must Accurately Explain the JOC Process
• Some Standard Clauses Need to Be Modified for JOC
• Poorly Drafted Contract Language Increases Risks &
Costs
9
Job Order Contracting Overview
JOC Structure & Bidding Guidance
• County establishes a fixed initial term
•
Typically one year
•
May include options to extend
• County establishes a guaranteed minimum dollar value
•
Some nominal amount - typically $25,000 or $50,000
• County establishes a pre-established maximum value
•
Represents the expected amount of work to be accomplished
•
Based on owner’s budget
• Prior to bidding the County does not:
•
Identify or commit to any specific project or location
•
Identify or commit to any specific quantities or tasks in the catalog of
construction tasks
10
Job Order Contracting Overview
A JOC is Competitively Procured!
• Each bidder must bid two adjustment factors to the prices
published in the unit price book
•
Normal time & other than normal time
•
Same two adjustment factors apply to all tasks in the unit price book
•
Adjustment factors must include all indirect costs & profit & are fixed for one
year
• Lowest adjustment factors (i.e. lowest bid) is the basis of
award to the lowest responsive, responsible bidder
•
A typical adjustment factor might be 1.10 or 1.20
•
The same adjustment factor applies to every task in the unit price book and
cannot be changed
11
Job Order Contracting Overview
How Does JOC Work?
• Joint Scope - County & contractor jointly develop scope of
work as a team
• Contractor develops price using tasks & prices from the
unit price book
•
•
•
Each total task price = price book unit price x quantity x adjustment factor
Prices are fixed, only scope is negotiated
Also develops schedule, shop drawings, material samples
• Contractor’s price & other information is reviewed &
approved
• County issues a lump sum job order
•
Risk of performance remains with contractor - no adjustment of quantities
after issuance of job order
• Average duration from joint scope to issuance of job order
is ~ 28 days
12
Job Order Contracting Overview
JOC - Why It Works
• The job order contract is a series of individual projects or
job orders
•
Contractor is guaranteed only a minimum amount of work
•
If minimum value is met, no further work has to
be given to a failing contractor
• Contractor has a continuing financial incentive to provide:
•
Responsive services
•
Quality work
•
Lower cost
• Future job orders tied to contractor performance
•
No obligation to give a specific project to JOC contractor
•
Additional JOCs may be bid and awarded
•
Key point - profit for prime JOC is a function of volume
• JOC is truly a performance-based contract
• JOC does not replace traditional methods for
accomplishing work
13
Sacramento County’s
JOC Program
14
Sacramento County
Benefits
Sacramento County’s JOC Program provides significant and
measurable benefits over the more Traditional Design-BidConstruct process
•
Significant time savings - upwards of 90%
•
Lower overall construction costs of an estimated 8% to 15%
•
Lower Soft costs
•
Higher quality work
•
Virtual elimination of change orders, claims, defaults and terminations
•
Greater control over contractors whose future hiring is dependent upon job
outcomes
•
Increased transparency at all levels
•
Enhanced opportunities for Small, Local, Minority and Women-owned
Business Enterprises
•
Enables Sacramento County to more effectively manage multiple
construction locations from a single vantage point through the use of web
based software and administration
15
Sacramento County
Traditional Process: 9 to 15 Months
2-4
Months
4 - 6 Months
2–4
Months
1
Month
JOC Process: 3 to 5 Weeks
1 Week
1 Week
1 - 3 Weeks
16
Sacramento County
•
JOC Program Initiated in 2002
•
Over 400 Projects have been completed using JOC
•
Total Value of projects in excess of One Hundred
Million Dollars
•
No Claims filed
•
No litigation filed
•
17
Sacramento County
• Departments that use JOC
•
Architectural Services
•
General Services
•
Sacramento Airport System
•
Water Resources
•
Department of Transportation
18
Sacramento County
• Sacramento’s Structure
Architectural
Services
Airports
Water
Resources
General
Services
DOT
19
Sacramento County
• Advantages:
• Insure consistancy in procedures throughout all county
departments using JOC.
• Provides control of projects that my include hazardous
materials.
• One point of contact for contract administration
• Additional Oversight for compliance
• Challanges:
• Insuring all project mangers follow the same procedures
• Additional layer of overhead
20
Sacramento County
• Department of Water Resources
• The department has an annual budget of $3,000,000 for
upgrading existing storm water drainage system. JOC is
typically used to repair and upgrade the system.
• By using JOC the county can control the costs of unforseen
conditions.
•
Price out projects during the winter months and begin work in spring
without delay.
•
Pre priced Change Orders
•
Issuing Job Orders for exploratory excavation.
21
Sacramento County
• Architectural Services
• Typical projects are multi traded projects with an average
cost between $75,000 and $100,000.
• Specialty projects that require a signicant amount of
phasing.
• Projects with a high likelyhood of change orders if bid in the
traditional design bid build process.
• Fast track projects
• Repair, remodel and renovation projects.
22
Sacramento County
• DOT
• Sacramento County Department of Transportation using
JOC to install traffic calming devices on existing road ways.
• JOC has drastically reduced the procurement time and
costs for the Sacramento County Traffic Calming program.
• The following is an example Project
23
Traffic Calming
24
Traffic Calming
25
Sacramento County
• Sacramento Airport System
•
Uses JOC to accomplish time sensative projects.
•
JOC Allows the airport an on call contractor with all the
appropriate security clearances.
•
Used as a support contract to the "Big Build" Terminal
Modernization Project.
26
Taxiway Repair
27
Taxiway Repair
28
California JOC Programs
• County of Sacramento
• County of Ventura
• County of Solano
• County of Los Angels
• County of Contra Costa • County of Riverside
• County of Sonoma
• County of San Diego
• County of Alameda
• County of Fresno
• County of San
Francisco
• County of Kern
• County of San Mateo
• County of Santa Clara
• County of Tulare
• County of San Luis
Obispo
29
California JOC Programs
• UC System
• California University System
• Los Angeles Unified School District
• SANDAG
• City of Long Beach
• City of San Diego
30
Procurement Authority
• Counties Issue JOC Contracts Under The Annual
Contract Code 20128.5
•
Attorney General Opined That JOC Was A Form Of Annual
Contract
• CSU System And LAUSD Wrote Special JOC
Legislation
• Charter Cities Are Able To Issue JOC Contracts
Under Charter
• Non-charter Cities Have Two Potential Options
•
•
Under The Uniform Cost Accounting Procedures Issue JOC
Contracts Only For Project Under $125,000
Issue A General Requirements Contract
• Follow The Principals And Structure Of JOC
• List All Of The Potential Projects To Be Accomplished
31
Procurement Authority
• State of California
• Open discussion point
• Nothing prohibits JOC
• JOC is Competively bid
• Section 10124 authorizes contracting on 'a unit basis'
• Other Jurisdictions
• Califronia Government Code Title 1, Division 7, Chapter 5,
Article 1, Joint Powers Agreements.
• National Joint Powers Alliance has compitively bid "JOC
Type" contracts in accordance with California Public
Contract Code
• NJPA Members can purchase off of these contracts.
• www.eziqc.com for more information on this system
32
JOC Awards
•
In 2005, the City of Miami Beach won the prestigious Robin J. Zee Presentation for
Excellence and Outstanding Achievement Award by utilizing TGG’s JOC Complete
Solution®.
•
The award, which referred to the City’s use the JOC Complete Solution as the “Best of the
Best”, was awarded by the National Institute of Governmental Purchasing (NIGP).
Measurable Results Leading to the NIGP Award
Projects Completed
Procurement Time
Change Orders
Protest/Litigation
Traditional
Procurement System
JOC Complete
Solution®
78 in 5 years
131 in 2 years
184 days/project
21 days/project
273
0
9
0
33
Questions and Answers
34

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