• Bonnie Gonzalez CPPO at H2 Group• Former Arizona Attorney General Janet Napolitano• Arizona State Administrative Code, Chapter 23, Procurement

Code• Arizona State Administrative Code, Title 7. Education, Chapter 2.

State Board of Education• AZ School Facilities Board

Sources

• Describe objectives as related to on-call procurement

• Appropriateness of various on-call procurement strategies that reduce district management resource allocation needs

• Understanding of allowable state procurement rules and statutes

• Ability to weigh the benefits and cons of the procurement method based on your needs

Learning Objectives

Rule R7-2-1001 defines:

• “Specified professional services” means services of an architect, engineer, land surveyor, assayer, geologist and landscape architect.

Other pertinent definitions:

• “Procurement” means buying, purchasing, renting, leasing or otherwise acquiring any materials, services or construction.

• “Cooperative purchasing” means procurement conducted by, or on behalf of, more than one public procurement unit.

• “Contract” means all types of agreements, including purchase orders, regardless of what they may be called, for the procurement of materials, services or construction or the disposal of materials.

What is “Procurement of Specified Professional Services”?

Professional services is awarded by qualifications based merit, rather than competitive bid. Therefore competitively sealed proposals are used versus competitively sealed bidding. A summary of the process is as follow:

1. Request for qualifications(RFQ) shall be issued at least 14 days before the time and date set for bid opening. Invitations shall include, description of scope of services, type of contract to be used, estimated budget and schedule closing date and time of receipt of qualifications, evaluation criteria and their relative order of importance (Additional requirements per R7-2-1042, R2-7-C301, A.R.S. 41-2534 or A.R.S. 41-2578)

2. Pre-Proposal Conference (optional but recommended / mandatory)3. Conduct interviews with at least three and no more than five persons or firms4. Negotiate contract with highest ranking firm based on evaluation criteria, notify those

not highest5. Award contract, or if terms cannot be reached, negotiate contract with second highest

ranking firm based on evaluation criteria

What is the required procurement process?

• Per R7-2-1117, two methods of award of a contract for specified professional services are the single negotiated fee method of award(R7-2-1122) and multiple fee proposal method of award(R7-2-1123).

• Note, per A.R.S. 41-2578, C, 1, D, All construction-manager-at-risk construction services or design-build construction services included in a procurement under this section shall be limited to construction services to be performed at a single location, a common location or, if the construction services are all for a similar purpose, multiple locations. This does not specifically apply to specified professional services, beyond that precedence might be argued based on the above Statute.

Arizona Administrative CodeChapter 2: State Board of Education, Title 7

• R7-2-1093 statesUnless otherwise provided by law, a contract for materials or services may be entered into for a period of time up to five years, as deemed to be advantageous to the school district, if the term of the contract and conditions of renewal or extension, if any, are included in the solicitation and monies are available for the first fiscal period at the time of contracting. Payment and performance obligations for succeeding fiscal periods are subject to the availability and appropriation of monies.

This multi-term contract is allowed providing the governing board determines among other things that “such a contract will serve the best interests of the school district by encouraging effective competition or otherwise promoting economies in school district procurement.”

**Upheld by Attorney General Opinion, Janet Napolitano (November 24, 1999)**

Arizona Administrative CodeChapter 2: State Board of Education, Title 7

Specified Professional Services Procurement Options

1. Traditional Procurement per R7-2-1122single negotiated fee method of award(solicitation by district)

2. On-Call District Procurement per R7-2-1123multiple fee proposal method of award(solicitation by district)

3. On-Call State Procurement per A.R.S 41-2581single or multiple contracts, projects less than $250,000 for architectural services or $500,000 for Engineering services (solicitation by state)

4. Cooperative Purchasing Agreement Procurement (R7-2-1191)single negotiated fee method of award(solicitation by cooperative)

Sample Master Contract & Work Order• Set fee percentages

for different types of projects

• Lists multiple projects or project types covered in the RFP

• Incorporates overall general conditions and insurance requirements

Sample Master Contract & Work Order

• Lists other/supplementary conditions

• Sets limits or types of reimbursable expenses

Master Contract & Work Orders• Defines specific

project

• Sets Fee

• Further defines reimbursable expenses if needed

• Lists additional sub consultants

• Defines deliverables

• Ties to master agreement and general conditions

On-Call Professional Services -Recommendations

One or more design professionals selected to provide services for a period of up to 5 years.

Recommended that the contract is awarded as a one year term with options to extend up to four additional terms

Base fee as a percentage of Maximum Allowable Construction Cost (MACC) with sliding scale for project complexity (Established for each year of service)

Hourly rates established for time and materials type projects and or additional services / added scope (Established for each year of service)

Single project manager as point of contact throughout the term of the contact with multiple project architects identified for specific project types, i.e. new facilities, renovation and additions, tenant improvements, assessments etc.

Identification of consultants covering all disciplines, (local civil engineer recommended)

On-Call Professional Services -Recommendations

Sample Fee Schedule

Sample Fee Schedule

Benefits of District On-Call Procurement

One time solicitation to serve for a 5 year timeframe• Time and cost savings, no repetitive procurement• Ability to evaluate qualifications and personnel at the district level• Set or negotiated price for each project• Budget project design costs

Consistent representation• Main point of contact / project manager• Specialized expertise / project architects for different project types• Knowledge of, or ability to establish, district standards• Establish and test Owner Project Requirements (OPR) document

Benefits of District On-Call Procurement

Quickly contract new work through work orders

Resource available for assessments, planning and cost estimation

Advocacy and funding application support

Ability to run several project simultaneously and conserve district recourses

Advisor for maintenance and preventative maintenance planning (BIM)

Potential for reducing reimbursable expenses by combining project meetings

• Turnover – Might see turnover within architecture firm that changes the team that you work with

• Expertise – Might not have an architect that has expertise in specific needs

• Capacity – Might overload your architect

• Complacency – Designs may not be innovative

• Perception – Best interest of the district….non-competitive

Potential Cons of District On-Call Procurement

Case StudyGallup McKinley County School District

• One of three on-call architects• Three four year on call-contracts• 35 Projects

Not just design• Planning• Assessments• Project budgeting• 5 Year Master Planning support• Funding application processing• Community Facilitation & Bond campaign support

As needed summer renovations and repairsEmergency repairs

Artesia Public Schools• One on-call architect• One year contract with possible 2 year extension• 14 Projects in first year

Not just design• Bond campaign support• Assessments• District wide utilization study• Comprehensive operating cost comparisons

Flexibility to address a shift in district facility design prioritiesEmergency structural and roofing repairs

Case Study

Summary

Objectives:• Save time, money and District resources• Creating a long term beneficial relationship

Application:• Several under defined needs• Limited district facility management and maintenance resources

Understanding of State on-call procurement rules:• Procurement flexibility• Promotes competition

Questions?