Capital Programs Management Group (CPM)

Effective: 6/1/1986

Revised: 11/1/2002

CPM 306–07: Construction Bid Process and Award of Construction Contract (Design/Bid/Build Process)

Purpose

To ensure that in design bid build projects:

1. competitive pricing of capital programs is obtained
2. contracts are awarded to the lowest responsible bidders

   and

3. written permission is given to contractors to proceed with construction

Sources

Arizona Procurement Code

Arizona Board of Regents Policy Manual - 3-804; 7-106

Applicability

Small capital programs requiring Capital Programs Management Group services; capital projects; and major capital projects

Policy

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Bid Advertising

Upon completion of the construction documents, the project is advertised for bids. The bid period shall be established to be most advantageous to the university, taking into account:

1. the overall project schedule
2. the size and complexity of the project

   Note:

   Larger, more complex projects are given bidding periods that allow contractors the time to prepare competitive bids.

   and

3. the current local bidding climate.

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Bid Opening

A bid opening, presided over by Purchasing and Business Services, is held on the bid date at the time of the bid closing. All bidding contractors and other interested parties are invited to attend the bid opening.

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Contract Award

After evaluation of bids, a contractor is recommended. For bonded projects, regardless of project cost, construction does not begin until the Joint Committee on Capital Review (JCCR) authorizes the bonding of the project.

ASU awards construction contracts on partial or fully gift-funded projects only under the following conditions:

1. when 100 percent of the pledges are made, 50 percent of the pledges are received, and the balance is scheduled to be received before the construction cash flow requires it

   or

2. when 100 percent of the pledges are made and the ASU Foundation has funds in-hand and has committed to use them for uncollected pledges as construction cash flow needs arise.

No exceptions to the policy are allowed without the prior written approval of the president or the executive vice president and provost of the university. Exceptions must include, at a minimum, a financing alternative acceptable to the university that keeps the project’s construction on schedule and does not expose the university to undue financial risk.

A written Notice to Proceed is approved by the Capital Programs Management Group and issued by Purchasing and Business Services to the contractor after contract award is made. The Notice to Proceed memorandum contains:

1. an agreed-upon starting date
2. length (i.e., number of days) of the contract
3. a completion date

   and

4. the amount of any liquidated damages (i.e., charges for exceeding the contract time) that might apply.

The contract is prepared by Purchasing and Business Services to formalize the procedure.

ProcedureD

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Responsibility	Action
	After consultation with the architect/engineer (A/E), the Building Committee, and the construction manager (CM), if appropriate:
Capital Programs Management Group (CPMG) and Purchasing and Business Services	Establish the date, time, and place of the bid opening. Prepare a Notice to Contractors of Intent to Receive Bids and forward it to Purchasing and Business Services five days before the publication date.
Purchasing and Business Services	Publish for the legally required time in a local newspaper an Advertisement for Bids containing the information in the Notice to Contractors of Intent to Receive Bids.
CPMG and Purchasing and Business Services	Consult with the CM and/or A/E and conduct a prebid meeting for the benefit of interested bidders.
Purchasing and Business Services	Preside over the bid opening at the established time and place. Open, read aloud, record, and witness all bids.
Building Committee	Review the bids for compliance with the budget. Select alternate bids where appropriate.
CPMG, Construction Manager, and/or A/E	Review bid results and recommend award of bid to the lowest responsible bidder.
CPMG	Draft the Notice to Proceed form and forward it to Purchasing and Business Services for an authorized signature. Prepare the Construction Contract Required Data Listing and forward it to Purchasing and Business Services for contract preparation, along with a requisition for the contractor.
Purchasing and Business Services	Sign and issue the Notice to Proceed. Prepare construction contracts and issue them to the contractor for an authorized signature.
Contractors	Send contractor’s bonds, insurance certificates, and signed contracts to Purchasing and Business Services.
Purchasing and Business Services	Sign and reissue contracts to the contractor for the user and forward the copies to the Capitals Programs Management Group.

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endtable

Cross-Reference

For information on advertising for construction bids, see the Purchasing and Business Services Policies and Procedures Manual—PUR 501–02, “Advertising for Bids.”

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