Question

BACKGROUND

In the coming fiscal year, the Chief Procurement Officer (CPO) of a large metropolitan county will be responsible for contracts that are worth more than $100 million in construction and facility renovation. The county procurement staff will be taxed to award all of these projects in the time allotted. The CPO attended a presentation on Job Order Contracting (JOC) at a recent national procurement forum. JOC is a competitively bid, firm fixed price contract with indefinite quantity designed to accomplish small to medium multi-trade maintenance, repair and minor new construction projects. The procurement department plans to issue a Request for Proposals containing a Unit Price Book, which contains a comprehensive listing of specific construction related tasks together with specific units of measurement and unit prices that are fixed for the duration of the contract. Each unit price is comprised of the labor, equipment and material costs to accomplish each specific task. Contractors will submit price adjustments to the unit prices as published in the Unit Price Book. The Unit Price Book reflects labor rates, construction material, and construction procurement costs in the area. Contractors must bid three adjustment factors; one for work to be accomplished during normal working hours, one for work to be performed during other than normal working hours and one for work to be performed during premium working hours. All adjustment factors are expressed as an increase or decrease from the published prices. Award will be made to the qualified contractor submitting the overall lowest pricing structure. The awarded contractor will receive Job Orders for specific projects they submitted proposals for, based on the Unit Price Book and adjustment factors. The contractor will be responsible for all subcontractors and satisfactory completion of all work in the agreed time. The County Commission has made it clear that the preponderance of these projects should be awarded to local businesses with particular emphasis on awards to small, woman and minority owned businesses.

DISCUSSION

The CPO believes that using JOC may be a way to quickly move the large number of projects forward during the fiscal year. There are several large, national firms with extensive experience in JOC. There are also nationally recognized indexes of construction tasks and unit prices that are updated periodically to use as the Unit Price Book. However, the CPO is not aware of any local firms or governments that have used this method of contracting.

QUESTIONS

1. How would JOC support each of the goals of public procurement?

2. Which goals might be more likely to be supported? Are there tradeoffs to consider?

3. What legal, procedural, political and management issues would confront the procurement department?

4. What might be the reaction of the County Commission to this form of contracting?

Answer 1

1.The contractor who present satisfactory unit price to cpo get contract, and his contract should need to full fill all the goals that are expected by the public procurement. Joc order contract is a competitive contract in which many contractors participate due to this spirit of competition all are come with best one to get contract. They include minimum time to complete large work with necessary goods and laboures. This makes easy to job for cpo to select contract. 2.All goals need to consider in a wise manner, in big contract it is hard task to consider all the wants of public procurement. material cost and equipment cost can considerable, but labour is essential need of workers it cannot be negotiate with deduction. yes ?tradeoffs should need to consider, because in large contract there should a need of consideration and negotiation, factors like climate, market price and labour shortage could affect the contractors. 3.establishing contract between contractor and procurement is on the basis of legal aggrement. views of both side is included in it with certain norms and conditions. When there is a non acceptance in contract from both sides, then legal and political crisis can form. It will held to court for the judgement if there is such issue generates. Managing construction and development is a hard methord. If there is any fall occurs, then the entire contract would be in problem. 4.even though cpo not investigated about local firms and govt that used this methord before. It can be successful and unsuccessful, but it depends upon the nature of contact here cpo done a great work to maintain a good contract, that's why I think procurement will accept cpo's decision